Tuesday 25 November 2014
[Mr James Gray in the Chair]
Motion made, and Question proposed, That the sitting be now adjourned.—(Dr Thérèse Coffey).
I am pleased to be able to introduce this debate on behalf of my constituents and, indeed, those nationally who are interested in the issue. The aims of energy policy are probably uncontroversial. They are to secure security of supply, and ideally indigenous supply, in order not to be held hostage by other countries in due course; to help to meet our climate change targets; and to use the energy supply to create jobs, to help the economy and, ideally, to keep prices down. The issue is whether the Government’s policy on fracking achieves those objectives. I am not sure that it does, and I therefore suggest to the Minister that we may be backing the wrong horse or at least putting too much money on the wrong horse, as I will now show.
On the security of supply, the Chancellor of the Exchequer has said that there is “huge potential” from fracking and the Treasury has said that the potential is “too big to ignore”, but that seems to be at odds with the recent report from the UK Energy Research Centre, which received some coverage earlier this month. Professor Jim Watson, UKERC research director, said:
“It is very frustrating to keep hearing that shale gas is going to solve our energy problems—there’s no evidence for that whatsoever...it’s hype… Shale gas has been completely oversold. Where ministers got this rhetoric from I have absolutely no idea. It’s very misleading for the public.”
Professor Mike Bradshaw, his colleague at the UKERC, said:
“Only one thing is virtually certain—in Europe shale gas is not going to be a game-changer.”
There appears to be a variance between what Ministers have said and what the UKERC experts say.
Research by the British Geological Survey, which assessed the shale gas potential of the Weald basin, which the Minister will understand I am particularly interested in as it covers the South Downs national park and elements of my constituency, concluded that shale formations in the basin could contain between 2.2 billion and 8.5 billion barrels of oil, rather than gas, with a mid-case estimate of 4.4 billion, which would be equivalent to close to a decade of UK consumption. That may explain why the Chancellor and others think that fracking has huge potential. However, the BGS went on to say that the research found that many of the Weald shale samples contained more clay than the most prolific US fields.
Data from the US, where it is easy to extract oil and gas, suggest that, at best, only 5% of the oil may be extracted from shale. A university professor says that
“we might estimate that 1 per cent of the Weald oil resource might be recoverable.”
He calculated that that equated to 50 million barrels or two months of UK consumption and said:
“From a national perspective, this seems to be a rather small prize.”
There is significant doubt about whether the reserves of potentially usable shale gas and shale oil will be as extensive as the Government has maintained.
I now want to look at the potential in relation to climate change and the argument that shale gas is a bridge to the future and cleaner than coal. Again, that is in doubt. First, it is worth pointing out that, in the south-east of England, we are talking about oil rather than gas in many respects. That factor has not, perhaps, permeated through to the public at large. The BGS completed an estimate in May 2014. Although it is estimated that large quantities of shale oil are present, no significant gas resource is recognised using the current geological model because the shale is not thought to have reached the geological maturity required to generate gas. Therefore, we are talking about oil extraction rather than gas extraction as far as areas round my constituency are concerned. That is an entirely different proposition in terms of climate change.
In the “World Energy Outlook 2012”, the International Energy Agency concluded:
“No more than one-third of…reserves of fossil fuels can be consumed prior to 2050 if the world is to achieve the 2° C goal”.
And Mark Carney warned recently that the vast majority of fossil fuel reserves are “unburnable”.
I congratulate my right hon. Friend on securing this important debate. He has just put his finger on it. Are not the displacement arguments meaningless in the absence of a global deal on limiting carbon emissions? Coal that is not burned in power stations here will still end up being burned elsewhere.
My hon. Friend makes a very important point. We have to look at the global use of fossil fuels, which is the point that I am coming on to. It would be completely irresponsible for the world to use the fossil fuels that exist in total. Therefore, we have to move towards alternatives, rather than simply switching one fossil fuel for another. Some shale gas advocates have argued that it will reduce emissions, because shale gas will replace coal. That relates to the point that my hon. Friend makes. However, the Committee on Climate Change states that coal should be off the system entirely by the early 2020s. My hon. Friend will know that at our party conference this year, we committed to ensuring that that happened. The best industry estimates are that shale gas will not be online until the 2020s, by which time there should really be no coal to replace.
On the displacement point, the right hon. Gentleman says that coal will be off the system by 2020. That may be the objective in this country; unfortunately, it is not the objectively globally. Coal use increased globally eight times more in absolute terms than renewables last year, and there is a very strong displacement argument vis-à-vis gas and coal.
I entirely accept that the geological conditions are different in different countries. There may be a stronger argument elsewhere for shale gas, for the very reasons that the hon. Gentleman has given, but I suggest to him that in the UK context, that argument does not stack up, for the reasons that we have given. Also, this UK Government and the previous Government have given a strong lead internationally on tackling climate change. We have a very good record on that, and what we do is very important in sending a signal to other countries. We should not underestimate that.
The right hon. Gentleman is making a very powerful case. Does he agree that the research from the Tyndall centre is very useful in this respect? It says that UK shale gas development is “quantitatively and unambiguously incompatible” with the UK’s commitment to working towards remaining below 2° C of warming.
If we end up with a massive shale gas industry, which is what some parts of the Government have suggested may be the case, we are building in reliance on fossil fuels to a large degree for an indefinite period. If, however, the shale gas reserves are not realisable, as I believe they may not be, we will spend a lot of money and time on something that does not produce much at all. Either way, it does not make sense.
I am following the right hon. Gentleman’s argument with interest. Does he not have to agree that most householders in the United Kingdom have gas appliances in their properties, that we will need gas for some time and that if we do not look at our natural reserves, either in the North sea or on land—even down south where he is—we will have to rely on imported gas for many years to come?
Undoubtedly, we are largely dependent on gas. I would argue that natural gas is preferable to coal. However, I am not sure that that is the case with shale gas, for the reasons that I will come to, one of which is methane leakage. US studies have shown that up to 9% of methane can escape into the atmosphere, and over a 20-year timeline, methane can be 86 times more powerful, greenhouse gas-wise, than carbon. Therefore, there is a real danger that far from being something that aids us in reducing carbon emissions, shale gas, if not controlled properly, could be as bad as coal. The type of gas and how it is extracted are very important in ensuring that our carbon emissions or greenhouse gas emissions are as low as possible. There is growing evidence that methane emissions can be very high. I ask the Minister to address that issue and tell me what the Department of Energy and Climate Change is doing to ensure that the regulatory regime is robust enough and does not simply rely on what the industry says but uses independent analysis to establish the levels of methane leakage.
The Minister may want to comment on the drilling that has taken place at Preese Hall in Lancashire—PH1. I understand that the site is to be abandoned and grassed over because of the leakage problem at the Cuadrilla site, owing to the well casing issue. If he would like to comment on that, I would be grateful, because it seems to suggest that the regulation on well casings is not as thorough as it might be.
There is also an issue about jobs and the economy. The Minister has rightly drawn attention to the jobs that may result from fracking, but jobs would come from any energy investment, so the question is what sort of energy investment we want. Of course we want jobs to be created, but at what cost? There will be costs as a consequence of pursuing fracking.
I am following the right hon. Gentleman’s argument about jobs. Does he accept that as well as being an energy source, fracked gas is a feedstock for our chemical industry, which is currently vulnerable to the United States chemical industry because of the high costs of energy in this country and the lack of direct feeds into the industry?
I agree that any energy policy needs to take into account all relevant factors. Taking all relevant factors into account, however, I would not pursue the Government’s current fracking policy. I was referring to a number of downsides that need to be addressed. The Countryside Alliance has produced a brief in the past couple of days, which states that
“the development of a shale gas industry in the UK would be very challenging for a number of reasons, which include: constraints of population density; the current regulatory environment; existing land use at proposed sites; lack of associated infrastructure…and environmental concerns.”
The Countryside Alliance goes on to say that
“there are potential threats to the countryside, including: implications for land used for development; potential threats to other land users; pressure on local infrastructure; increased demand for water resources; waste management problems; increased light, noise and emission pollution; and increased risk to the local ecosystem and communities, such as habitat fragmentation, threats to local wildlife and contamination of water systems.”
That suggests that the Countryside Alliance is not entirely happy with the Government’s fracking proposals. In the brief, the alliance recommends the introduction of buffer zones between shale developments and local communities. Perhaps the Minister can tell us the Government’s policy on that. I think that it is fair to say that the alliance is nervous about fracking, although to be fair and accurate, it has not ruled it out. The National Farmers Union, which is concerned about the implications of fracking for agriculture, is in a similar position.
Concerns have been expressed about the Infrastructure Bill, which permits
“passing any substance through, or putting any substance into, deep-level land”
“the right to leave deep-level land in a different condition from the condition it was in before an exercise of the right of use (including by leaving any infrastructure or substance in the land).”
I do not believe that the inclusion in the Infrastructure Bill of such a wide sweep of permissions constitutes a world-class regulatory regime. Perhaps the Minister would comment on that.
I want to go back to the point made by the hon. Member for Blackley and Broughton (Graham Stringer) about the chemical industry. He suggested that shale gas would produce cheaper energy, but does that not depend on the structure in the United States? There is no evidence that shale gas in the UK will be extracted at a cost as low as that in the United States.
That is certainly true. The geology is different, and land use management is different in this country. We do not have the vast open spaces that exist in the US—I believe that Lord Howell referred to the “desolate” north-east, which I do not think is an appropriate description of our country—so of course the situation is entirely different. As we found with genetically modified crops, we have to have multi use of our land, rather than the mono use that is possible in vast areas of the United States. The hon. Gentleman is quite right to make that point.
Other objections have been made by, for example, the Royal Society for the Protection of Birds, which states that 99 protected areas, including 24 RSPB reserves, have already been licensed under previous licensing rounds. It argues that excluding a range of protected areas from shale gas exploration would rule out only 12% of the area that is up for grabs in the 14th licensing round. To give credit to the Minister and his colleagues, they have given a clear signal that they do not want fracking in national parks, and I am grateful for that, not least because that affects my constituency. If he could respond to the RSPB point about protected areas, that would be very helpful.
There is also a concern about water resources. The point has been made, quite rightly, that 27% of catchments in England and Wales only have enough water for additional abstraction 30% of the time. My water company tells me that there is less water per head of population in my constituency than in Sudan. The idea of vast amounts of water use for fracking concerns me.
On the question of the RSPB, is the right hon. Gentleman aware that fracking—not shale fracking, but fracking for oil and gas—has been going on since 1963 in Nottinghamshire, just over the border from my constituency, and in the Beckingham Marshes, which is an RSPB-protected area? The RSPB has never raised a single complaint against activity there.
The right hon. Gentleman mentioned his concern about drilling per se, and about deep drilling in particular. Of course, geothermal is just that; it involves drilling deep into rock. Are he and his party against that, or is the debate only about shale gas? It is rather confusing simply to have “Fracking” as the title of the debate.
To be clear, I am not speaking on behalf of my party; I am speaking on behalf of my constituents. I am not against exploring for geothermal, but I think that the same concerns apply, and they need to be properly considered and factored in. I would not want environmental standards to be compromised by anything that takes place in energy production, and geothermal would have to meet stringent standards.
The Chair of the Select Committee on Environment, Food and Rural Affairs, the hon. Member for Thirsk and Malton (Miss McIntosh), has said that there are too many unknowns when it comes to potential damage to the environment. The National Trust has said:
“There are very real dangers for the environment in going all out for fracking…Our position on fracking is clear—if fracking were proposed today on our land we would say no.”
There are, allegedly, potential health implications. I am not an expert on health matters, and therefore I simply wish to report what has been said and leave it to others to judge whether they are convinced. It is, however, right to put on record the fact that concerns have been expressed. The Lancet, no less, which is rigorous in ensuring that anything in its publication is of a high standard, recently published an article by Michael Hill, an expert adviser to the European Commission on the best available techniques for the management of waste rock, in which he stated:
“Although the UK Government has indeed stated that it accepts the Royal Society and Royal Academy of Engineering Working Group’s recommendations on shale gas extraction, the reality is that only one of these recommendations has been implemented in full; one out of ten in 2 years.”
Will the Minister confirm whether that is the case and, if it is, when the other recommendations will be implemented? Mr Hill stated:
“Other recommendations have been ignored or the opposite has been put in place.”
He went on, rather worryingly, to say:
“Recent studies from the USA have suggested an increased risk of adverse health events (such as congenital heart defects and low Apgar scores) in individuals living close to natural gas development (within a radius of 10 miles). These preliminary findings need to be replicated and explored further in large prospective studies; it may be irresponsible to consider any further fracking in the UK (exploratory or otherwise) until these prospective studies have been completed and the health impacts of fracking have been determined.”
I make no comment, and I have no view, on whether fracking causes serious health issues. However, it seems to me that that question needs to be addressed, and it would be helpful if the Minister would say something about the matter.
I draw attention to an article in The Independent on 30 October, which states that, according to scientists:
“Dangerously high levels of cancer-causing chemicals have been discovered in the air around ‘fracking’ sites in the United States…Levels of benzene, formaldehyde and hydrogen sulphide were many times above the US’s air pollution limits and were detected within residential areas near to fracking wells drilled across five different states, the researchers said. Some levels of benzene—a known carcinogen—were more than 30 times the concentrations that would be found in the air at a petrol station when filling a car with fuel, they said.”
That is a US study, and everything depends on the regulatory regime. If the Minister can convince hon. Members that regulation in this country is much tighter than it is in the US, he may allay those concerns. However, given the remarks that have been made about the Infrastructure Bill, we remain to be convinced that the regulation is as strict as the Minister may claim.
Does my right hon. Friend agree that, even though fracking is relatively new in this country, the House has had a debate that shows that we will have the world’s safest regulation on fracking? The experience in America happened over a period of decades when regulation was not as tight.
I agree that regulation in the US has not been particularly tight, as far as I can tell. I agree that Ministers have committed themselves to a strict regulatory regime, which is good. I question whether the rhetoric bears truth to the reality, because the Infrastructure Bill does not seem to reflect the high level of regulation that I would like to see.
No, I did not say that. I was very careful to say that I was reporting something from The Lancet and referring to an article from The Independent. I expressly said that I do not have a view on whether what is claimed in the articles is the case, but those matters should be taken into account, and they need to be addressed in order to reassure the public. That is what I said, and I repeat it now.
The right hon. Gentleman has made a number of interesting points. Does his contribution, and the debate so far, simply reflect the high level of public scepticism and concern about fracking, whether we are talking about the health implications or environmental concerns, many of which are clearly genuine and legitimate? To ensure public support, the Government should introduce robust regulation and monitoring before they proceed with the measure.
I agree with that entirely helpful contribution. On 12 August, The Daily Telegraph, which is of course a paper that we can always believe, reported:
“Support for fracking in the UK has fallen, with less than a quarter of the public now in favour of extracting shale gas to meet the country’s energy needs, according to…government polling.”
So support for fracking among the public at large appears to be lessening. At the very least, the Government has a job to convince the public that fracking is the right option. There is also nervousness among MPs, including among Conservative MPs, with seats where fracking may occur. I refer to my parliamentary neighbour, the right hon. Member for Arundel and South Downs (Nick Herbert), who is dealing with the proposals for the West Sussex village of Wisborough Green. He warned:
“Rural West Sussex cannot become a carelessly industrialised landscape.”
There is genuine concern that the countryside may end up being pockmarked as a consequence of fracking.
I referred earlier to Lord Howell, the Chancellor’s father-in-law, who said that fracking should be confined to “desolate” parts of north-east England. He also said, and I think he may be right about this:
“Every time ministers open their mouths to claim that fracking must start everywhere around Britain, and not just in carefully selected and remote…areas, they lose thousands of Tory votes.”
Will the Minister confirm the policy on the geographical spread of fracking?
In this House we are all concerned about energy bills and the cost of living. The Chancellor has said that there is
“a real chance to get cheaper energy for Britain.”
The Prime Minister himself has said that fracking has “real potential” to drive down energy bills, but Lord Browne, the chairman of the UK’s leading shale gas company, Cuadrilla, has said that fracking will not reduce gas prices. Will the Minister say what evidence there is that gas prices will come down as a consequence of fracking? The companies do not appear to think that gas prices will come down.
There is then the question of what else we might do if we do not have fracking, or if we have less fracking than the Government would like. An alternative energy strategy is available that would provide security, aid efforts to reduce climate change and produce jobs: further investment in renewables. I ask the Minister to back that horse. I hope that the climate change argument speaks for itself, but with regard to the security of energy supplies, renewables are all ours. There is an indigenous supply of renewables, which is endless by nature. We have immense potential for wind, solar, hydro, wave and tidal power in this country.
The Foreign Secretary recently said:
“Renewable energy sources will be critical to reducing our vulnerability to energy supply shocks”.
Those are wise words, and I am delighted that since 2010 the coalition Government has secured the investment of £29 billion in renewable energy sources, which is more than double the amount secured by the last Labour Government. Electricity from renewables has more than doubled since 2010, and we are now seeing the price of solar cut by two thirds. The Government is doing a great number of good things for renewable energy, and I argue that the potential to do even more is not quite limitless, and not quite renewable, but there is certainly potential to do a great deal more than we have so far achieved.
Investing in green energy creates green jobs, and I am delighted that the Secretary of State for Energy and Climate Change has given the go-ahead for a wind farm off the Sussex coast that will create some 100 jobs at Newhaven in my constituency. Those who rubbish renewables, particularly our UK Independence party friends, are busy destroying British jobs through their approach to such matters. We must ensure that the mood music coming from Parliament and the Government supports renewable energy and does not bring into question the Government’s future commitment.
As someone who is pro-nuclear and pro-renewable, I see no contradiction in their both contributing to a low-carbon energy policy. Is the right hon. Gentleman saying that he is against nuclear? Although he is not speaking on behalf of his party, we have seen a few U-turns from the Liberal Democrats on that issue.
If the hon. Gentleman is asking my opinion on nuclear, I will tell him that I am highly sceptical about the economics of nuclear power, but that is a separate debate.
I will conclude my speech to give plenty of time for other hon. Members to contribute. I advise the Minister to stop backing the wrong horse and back renewables. Shale has been “overhyped”—the word used by the UK Energy Research Centre. Shale could be damaging, rather than helpful, to our country. Energy security, climate change and jobs are helped by investing more money in renewables, instead of the concentration we have seen on fracking.
Order. A glance around the Chamber will demonstrate to all colleagues that this is an important and popular debate. I have the authority to limit the duration of speeches, but I do not believe it is right to use that authority. Perhaps hon. Ladies and Gentlemen will use their good will and discretion to limit their speeches to about five or six minutes, if that is agreeable.
It is a pleasure to serve under your chairmanship again, Mr Gray. I will take your direction, because I realise that many hon. Members wish to engage. I congratulate the right hon. Member for Lewes (Norman Baker) on securing the debate.
It is important that we discuss how to reduce our reliance on imported energy to meet our future needs, as well as how to meet our commitments to reduce CO2 emissions. It is true that Europe relies on energy imports, and in Britain the bill is high—I am told it is in the region of £12 billion a year. Progress on reducing carbon emissions remains slow, and only last week we discovered that, at the current rate, the UK will miss its target on reducing air pollution by 20 years. It is essential that we look to cleaner and more diverse energy production and to more sustainable ways of powering the country.
Those in favour of fracking say that the UK is ripe for a fracking revolution. They say that fracking will be vital to providing energy security while helping to develop a domestic energy industry that will lead to more jobs and investment in local communities across the country. No doubt such beliefs have paved the way for the Government’s tax breaks for the shale gas industry, making Britain the world’s most pro-fracking country, but at what cost to our green energy commitments? It would be unrealistic to say that gas will not play a part in the UK’s future energy mix, but the fracking-at-any-cost approach ignores many problems, and it must be addressed.
The jury is still out on the safety of fracking. The lack of consensus reflects the fact that the process is perceived to be fraught with difficulties and, as such, is an operation that fails to command public trust. “Proceed with caution” seems to be sensible advice. Little has been done to allay the fears that fracking could contaminate water supplies or endanger properties. The public fear that fracking will have far-reaching implications for the environment. Why have the Government chosen to ignore environmental concerns, rather than address them and provide the safeguards for which communities and the public are asking?
I congratulate the right hon. Member for Lewes (Norman Baker) on securing the debate, and I apologise for missing the beginning of it. Does my hon. Friend the Member for Inverclyde (Mr McKenzie) agree that local people are not only concerned about the process’s environmental impact? From our experience in the north-west, there is damage to local amenities, policing and transport. Vehicles arriving at fracking sites also cause problems. There is a need to plan very carefully not just for the processing input but for the whole context and locality in which fracking takes place.
My hon. Friend makes the very good point that the implications of fracking go beyond just the environmental, and she has laid out some of other aspects.
Fracking will do little to help Britain to reduce its carbon dioxide emissions. Research from BP earlier this year suggested that, even with the increasing use of shale gas as an energy source in the future, we can still expect greenhouse gas emissions to increase by about 29% during the next two decades. Given our already poor record on emissions, it would be a mistake to prioritise the use of an energy source that will do little to help us to meet those commitments.
Most importantly, shale gas will not last for ever. We should consider diversification and a mix of energy production, as well as investing in renewables, an energy source that will not simply disappear. Instead, it will provide jobs and investment in local communities for generations to come, helping us to build a truly environmentally friendly energy policy. The potential in the sector is great, but benefits from the fracking industry mean that it could be neglected. If that is the case, the UK would be left trailing behind others in creating sustainable energy for the future.
Talk of renewables often conjures up images of endless rows of wind turbines, which are themselves questionable in terms of energy efficiency, and which ruin previously picturesque parts of our countryside. Such imagery merely reflects the lack of imagination on the subject that is being shown by both the UK and the Scottish Government. Renewable energy can be so much more than that imagery suggests, and it is vital that our environmental policies reflect that.
For example, the west coast of Scotland has more coastline than the entirety of France, and it receives some of the world’s strongest tides. It is ripe with opportunities to help Britain to become a leader in green energy. Tidal energy could provide an estimated 20% of our energy needs, and it is immensely short-sighted not to take advantage of it.
My hon. Friend makes a very good point. I am sure he is aware of the crisis that is now affecting marine renewables in the UK, with Pelamis Wave Power, which has a turbine in my constituency, going into administration, and with difficulties affecting other tidal power firms. Would it not be much better if the Government put resources, subsidy, effort and drive into ensuring that we do not lose our lead in marine renewables, rather than put so many eggs into the basket of fracking?
Absolutely, Mr Gray—my hon. Friend makes a very good point about the importance of pushing ahead with our renewable energy sources, including putting more research and development resources into the marine renewables sector.
If there is one thing that we are not short of in the west of Scotland, it is rain, which could open the way for many hydro projects if only there were the same enthusiasm for them as there is for fracking. As I have said, tidal projects could provide employment, and not just in the energy sector. Such projects would require maintenance by engineers using ships, which could have a knock-on effect on our shipbuilding industry.
The energy provided by tidal and hydro will not disappear overnight, whereas shale gas will come and go. There would be additional benefits from developing such energy sources. Proper management of water by hydro projects could mitigate some of the adverse effects of climate change—in my constituency of Inverclyde, problems with water management are partly responsible for the flooding we have experienced—but increased investment in green energy is unlikely if fracking remains the favoured, and indeed the only, cornerstone of our energy policy.
Many other Members wish to speak, so I will finish by saying that, rather than continuing to focus only on fracking, let us fully utilise the potential of renewables. They remain a small part of the energy mix here and worldwide, but renewable energy sources such as tidal, hydro and wind will help to make us a leader in reducing carbon emissions.
It is a pleasure to speak in the debate and I congratulate the right hon. Member for Lewes (Norman Baker) on securing it. I agreed with the first part of his speech, when he said that energy policy has three components—low cost, security of supply and decarbonisation—but we perhaps parted company afterwards.
There is no contradiction in supporting renewables and supporting fracking. In this country, renewables represent one tenth of the energy we get from coal and oil. I would like renewables to grow faster, but part of reducing carbon—I will say more about this later in my remarks—is the displacement of coal, which is very polluting, by gas. In the United States of America, there has been a massive reduction in carbon due to the shale revolution.
People have said that we should not bet the whole farm, or the whole world, on shale, and I agree. Nobody is saying that shale is a panacea to fix everything. However, we should evaluate the potential of shale in a safe, constructive and thoughtful manner. That is all I am saying.
People sometimes ask, “Should we frack or not frack? Should the world go down this route?” The world has already started down that route, and it is worth pausing to consider what has happened in the USA during the past 10 years. Yes, part of the picture is that gas prices have fallen from $10—roughly speaking, that is still the price in the UK—to something like $3 or $4, or by a factor of about a third. The consequence of that is lower domestic prices, less fuel poverty and a much revitalised manufacturing industry, as well as lower costs of feedstock for use in the petrochemicals industry, which has seen a renaissance in the USA.
We may not want a part in any of that—in Lewes, it may not matter, but it matters on Teesside, where marginal chemicals investment decisions are being made on whether to put the next production unit or piece of kit on the eastern seaboard of the USA or in our country. It also matters in what I have heard described as the “desolate north-west”, where a large number of jobs depend on energy-intensive industry. About 900,000 people in our country work for industries that rely on relatively cheap energy. For us to say that that does not matter, or that we should ignore it, strikes me as arrogant, wrong and disappointing.
I have heard it said, including today, that fracking will not reduce the price of gas in Europe. That argument is a reasonable one. We have a European gas system and get most of our gas from Europe—in fact, from Russia—and not than from the UK, although we are getting some from the UK. It is true that fracking will not automatically reduce cost but, generally, when there is more of something, the price comes down.
My next sentence would have been that oil prices have fallen by about a third in the past three or four months, because the USA, which was a large global market for oil, is no longer importing oil. The result is huge in terms of geopolitics and the position of countries such as Saudi Arabia. Of course, that cost reduction would happen with gas, too.
It is not only the cost of the material that matters, but the economic activity that comes with exploiting it. Such activity is not a displacement of renewables. Aberdeen and the areas around it have the four parliamentary constituencies with the lowest unemployment rates in the UK—the rates are lower even than those in the south-east of England and London. That record has been built on the back of the North sea oil industry, and some of that activity will happen if shale reaches its true potential.
People have said that that potential may not be there. I believe I heard the right hon. Member for Lewes say that the reserves may not all be recoverable. That is true. The assumption is that 10% of the technically available reserves will be recoverable. If so, that means 50 years of supply in the UK. It may not be that 10% is recoverable—it may be 1%—but let us find out, because a load of MPs in a room talking about it will not allow us to understand whether the true figure is 1%, 10% or 15%.
I mentioned our energy security and gas imports. They mostly come from Norway, but increasingly come from Qatar. The first contract between Centrica and Gazprom has been signed, starting now, so gas is also starting to come from Russia. The gas situation has changed in the past 15 years. Previously, we were a gas exporter, but no longer.
It is also true that we have security of supply problems in terms of keeping the lights on in this country. During the past decade or two, we have failed to replace power stations. We are turning off our coal-powered stations—we are the only country in Europe doing that at scale. The consequence is that the capacity margin here for next year is thought to be 2%. We are not building any kind of power stations. That needs to change. The Minister might well talk about that in his remarks.
Any student of the subject who does not believe that nuclear power globally is part of the decarbonisation solution does not have a thoughtful response to offer. Last year and the year before, 87% of the world’s energy came from fossil fuels. Of that, by far the majority came from coal and oil. If we could replace that coal and oil with gas—that is a big aspiration and it will not be done overnight—it would be equivalent in decarbonisation to the world increasing by nine times existing global renewables.
I will wrap up fairly quickly, Mr Gray. I clearly accept what the hon. Gentleman says—we have seen that happen in respect of the United States. That coal came to Europe because Europe failed to put in place an emissions trading system—it was principally scuppered by the Germans. As a consequence, it was cheap coal to burn. We have seen an upsurge in coal in Europe and more widely in the world, which is a big problem for those who take an interest in climate change. To pretend that emissions trading is not part of the solution is wrong.
To conclude, none of what I have said is an argument for being cavalier with local issues, whether they relate to transport or local planning. The local planning rules that apply to wind farms must also apply to fracking. There is fracking in my constituency. It is behind some large leylandii and, as I understand it, is causing objections from no one, but the situation in other places is more sensitive. I am not advocating fracking in the wrong place. I advocate proceeding in a responsible way to evaluate the potential of the technology and using it if it works.
I congratulate, as others have, the right hon. Member for Lewes (Norman Baker) on securing this important debate. I was going to intervene on the hon. Member for Warrington South (David Mowat) before you, Mr Gray, reminded us of the time limits, but I point out to him that Sir David King, the former chief scientist and former champion of nuclear power, has just performed a U-turn on the issue. The hon. Gentleman was being so scathing about those who do not believe that nuclear has a part in the energy mix, but we are in increasingly good company. I also point out to him that when he lauds what is happening in the US, he should bear in mind that the net cash flow from the US shale has been negative year after year. Some of the biggest names in investment in US shale are leaving. At an average US shale gas well, production can drop by 60% in 12 months. The Americans are having to build well after well. The UK is a much smaller country; we simply cannot do what the US is doing.
In the short moments I have, I will focus on two things in particular: I will say a few words about regulation, but I will mostly talk about the climate change arguments. On regulation, we have a Government who will keep trying to persuade us that they will put in place the robust regulatory framework we need to make fracking safe, yet at other times they put on a different hat and tell us how much they are proud of their deregulatory zeal. I do not think I am the only person suggesting that those two impetuses are contradictory. My fear is that the deregulatory zeal will win out.
We also have a Government who are starving such organisations as the Environment Agency of resources. That is precisely the agency that needs to be there to ensure that fracking is as safe as it can be. I echo the concerns and queries of the right hon. Member for Lewes on well integrity at Preese Hall and Balcombe. Can the Minister categorically reassure us that there have been no well integrity failures at Preese Hall or Balcombe? I tabled a written question on that, and it was transferred to the Department for Work and Pensions. I was disappointed that the Minister’s Department chose not to answer it. I am hoping, given that we have a joined-up Government, that he can answer that question shortly.
Even if we had a perfect, generously resourced system of standards, regulation and monitoring, which we do not, the question whether UK shale gas development can be sustainable must ultimately rest on whether it is compatible with securing a safe and habitable climate for current and future generations. The bottom line is that building a whole new fossil fuel industry is the last thing that the UK should be doing if we are serious about securing that safe and habitable climate for our children and grandchildren.
The argument that shale gas is lower carbon than coal only stacks up if minimum methane emissions can be guaranteed. Even if that were possible, the argument that shale gas can be a substitute for coal ignores the crucial issues of time scales, overall carbon budgets and the displacement effects that the hon. Member for Chippenham (Duncan Hames) has been talking about. Shale gas is still a high-carbon fossil fuel, even if it is a bit better than some coal. The crucial thing is that we have at our disposal numerous other ways to ensure that coal is off the system by the early 2020s at the latest. Other Members have given some examples of that. We do not need shale gas.
Those arguing that shale gas is compatible with the UK’s climate objectives ignore a pivotal issue, despite its being identified in the report from the Department of Energy and Climate Change’s then chief scientist. He said:
“If a country brings any additional fossil fuel reserve into production, then in the absence of strong climate policies, we believe it is likely that this production would increase cumulative emissions in the long run. This increase would work against global efforts on climate change.”
Essentially, the argument is about unburnable carbon. As other Members have said, reports and analysis from the Intergovernmental Panel on Climate Change, the Carbon Tracker Initiative, the International Energy Agency and even Mark Carney, the Governor of the Bank of England, all show that we cannot afford to burn the vast majority of existing fossil fuel reserves if we are to avoid the worst impacts of climate change. In the context of cuts and austerity, using public money on tax breaks and relentless public relations initiatives to help fracking firms find yet more oil and gas is inexcusable.
An effective response to climate change requires a complete shift to carbon-neutral energy systems within a generation in all the major economies, including Britain. We know how to do that. We have the technology and engineering capacity to do it and we can afford to do it. What we need is the political will, because we cannot do it while making ourselves more, not less, dependent on any kind of fossil fuel. This is how the UK’s former top energy and climate diplomat, John Ashton, put it:
“You can be in favour of fixing the climate. Or you can be in favour of exploiting shale gas. But you can’t be in favour of both at the same time.”
Just last week, the UK announced its welcome contribution to the green climate fund, which was set up to help developing countries cope with the devastating impacts of climate change that many already face. The Secretary of State for Energy and Climate Change was right to emphasise the need to help poorer countries to develop using clean renewable technologies and to highlight the green climate fund as a crucial part of the jigsaw of getting a global climate agreement in Paris next year. It is incoherent, irresponsible and deeply unhelpful for the Government at the same time to be doing everything they can to build a new dirty fracking industry in the UK. The only safe and responsible thing to do with shale gas is to leave it in the ground.
It is great to follow the hon. Member for Brighton, Pavilion (Caroline Lucas) and my hon. Friend the Member for Warrington South (David Mowat), because my view sits somewhere between Brighton and Warrington in this great war of experts, which has not helped our discussions.
If I have only got a few minutes, I will focus specifically on the situation in my constituency, where 23% of the land is open to licensing to test and explore fracking sites for shale gas. My hon. Friend made a cohesive speech and talked about there being no bonanza. Unfortunately, to many people in my constituency, it sounds as though people in London are saying that there is a bonanza. There has been talk about £366 billion of recovery gas under the Bowland shale, which crosses my constituency. As he said, there has been talk of us having the revolution that has happened in America, but when we enter into the argument and say, “Can we possibly have a share of that bonanza?”, we hear, “The costs of developing this are quite high and you don’t understand.” What is it to be? Are there vast profits to be made from this or not?
The sheer fact that has taken a great deal of time to land is that England is not the USA. Whether someone thinks that that is a good or bad thing is entirely up to them. I think that its development might be a good thing, because I have faith in our regulatory systems and their accountability. Those systems are a measure far above the USA and can provide security to people. The biggest area is that local landowners and residents do not receive any return from any possible development of shale. In fact, the Government’s Infrastructure Bill removes the age-old right for someone to have a say on who drills under their land and their house. That is a heavy-handed manoeuvre, which reinforces the view in my part of the world that the Government are bowing down too easily to international oil and gas companies and their financial interests.
There are international companies and American examples, experts are legion, and fundamental rights are being taken away. Is it any wonder that conspiracy theorists are having a field day across the north-west? The only response is that fracking is in the national interest in terms of energy needs and that the areas to be fracked will get a financial return after all. A Government press release states:
“Companies have pledged…to provide community benefits in areas where shale is commercially extracted.”
The north-west has seen company pledges for community benefits from offshore wind farms, but we are yet to see any money, because the companies decide who they give it to and what they will give it for.
We are told that £100,000 and 1% of revenues for every production site—estimated at between £1 million to £7 million a year—will apparently be given to communities near wells, but a number of issues then arise. Who is the community? Is it those on top of fracking sites or the local government ward or parish where fracking takes place? How will the money be distributed? Will that be done by household or through the local council? Can it be spent on anything or will the companies decide? Who guarantees that companies will pay up following takeovers and so on? Nothing in this is statutory. The Government have also promised that, on top of the 1% of revenues, local councils will now get 100% of business rates, which is a late addition to the financial promises.
All that is welcome, but it is confusing and last-minute when for months we in Lancashire have attempted to argue on a cross-party basis that such promises miss the point. There is no definition of “community”. There is no statutory guarantee. There is no guarantee that a future Secretary of State for Communities and Local Government will not take the financial rewards into account when deciding on central grants, so that nothing extra will be gained from fracking.
My hon. Friend makes a powerful point. The potential benefits of fracking may prove transformative, but they will only ever be achieved with local community support and the necessary safeguards. Community benefits play a key role in that. Communities need to know exactly what their rights are, but they do not at the moment.
For once, I agree with a Member from Yorkshire. My hon. Friend makes a real point. I pay tribute to my hon. Friends the Members for Wyre and Preston North (Mr Wallace) and for Fylde (Mark Menzies), with whom I have been working to argue for some form of sovereign wealth fund for Lancashire, into which the funds will be paid. It would have representatives from local authorities, so it would not be part of the local authority grant system and would represent something extra in return for fracking. As the hon. Member for Edinburgh North and Leith (Mark Lazarowicz) said, the reserves will not last for ever, but the fund would represent something that we can say we got in return. It is great to hear the Chancellor and the Minister recently make positive noises about such a wealth fund and INEOS talk about a 4% share of revenues, rather than just 1%. In addition, basing the new national college for onshore oil and gas in Blackpool is a positive move that demonstrates the possibility of long-term jobs to benefit the most-affected areas.
In conclusion, we need to know the scale of investment into the fund—if it happens—the area covered by the fund and the statutory underpinning that will accompany the fund. Only then can we hope to get back the majority political consensus across Lancashire that we had a few years ago.
I will be brief, Mr Gray, because the hon. Member for Warrington South (David Mowat) said most of what I wanted to say.
I agree with the hon. Member for Lancaster and Fleetwood (Eric Ollerenshaw) that it is vital that local communities, however defined, benefit from fracking. It would have been easier to guarantee that benefit under the old rates system, but that no longer exists, so something else needs to be put in place from which the Treasury cannot pinch money.
The hon. Member for Warrington South put well the real debate here, which is about a cautious approach to fracking, but one that recognises that the gas under our feet could represent a huge bonanza for our industry. It might not be, but nobody knows, which is why experiments to find out what is there and whether it is retrievable in a way that is not hazardous to local communities are important. That is the real debate, but it needs to be distinguished from the unreal debate, which comes from those who pretend that the debate is about health and safety, the environment and protection when they are actually, as the hon. Member for Brighton, Pavilion (Caroline Lucas) said, completely and totally opposed to fracking on what I consider to be bogus grounds.
The hon. Lady uses as a basis for opposing fracking the fact that we will not meet our emissions targets. So what? We are hitting our emissions targets—[Interruption.] Well, I will explain it to the hon. Lady, because she is in a fantasy world. In hitting our emissions targets, we are responsible for more carbon dioxide going into the atmosphere than we were before, because of embedded carbon coming in through industrial manufactured goods from China and elsewhere. The hon. Lady’s policy does not help the climate or reduce carbon dioxide. Her policy is about deindustrialisation, which is responsible for increasing the costs of industrial goods in this country by 9%, putting people out of work, and for increasing the cost of domestic energy, depending on how it is counted—by and large, it is not counted properly—by between £50 and £120 a year. The hon. Lady is concerned about carbon dioxide entering the atmosphere, but that is increasing because we are effectively subsidising imports from China and India.
It is very interesting in the context of fracking, Mr Gray.
We need to consider whether we can benefit from shale gas in a sensible and rational way. As hon. Members have said, prices will not necessarily decrease, owing to how the European market works. We will put our gas into that market and it will become diluted and the price will not shift much. However, we should see a benefit from taxation, and we certainly should see a benefit from the congeners of methane within shale gas that will be used by firms such as INEOS as a feedstock. Otherwise, we must be told how our chemical industry can compete with not only the Chinese and their strange accounting system, but the Americans, who have reduced the costs of energy and have cheap sources of feedstocks for their chemicals industry. There will be no such industry in this country if we do not do something about that.
My final point is about renewables. I am strongly in favour of moving into renewables, which can provide security of supply, but we are doing it at the wrong time, which is counter-productive. We need to put huge amounts of money into research, primarily into how to store electricity, because the renewables we have at the moment are not helping our economy. They are damaging our economy. I am not against renewables, but I am in favour of putting a great deal of money into research into better renewables, rather than into the renewables that we currently have.
I noted your earlier comments about the time, Mr Gray, so I will make my speech brief.
My constituency has lived with shale gas and fracking for the past five years. Indeed, three of the sites that have been drilled in Lancashire are in my constituency, and the two that are seeking planning permission from Lancashire county council are also in my constituency. The well at Preese Hall, which has been mentioned today, is also in Fylde.
I will keep my comments to regulation and some of the work that has happened during this Parliament. In a debate earlier in this Parliament, I called for the establishment of a body that could oversee the operation and regulation of shale gas in this country, and from that the Office of Unconventional Gas and Oil emerged. At the time, I hoped that that body would be able to interrogate the regulations, look at the work of the regulators and set about putting a process in place that delivered public confidence in relation to the regulation of oil and gas onshore activity.
I am disappointed with where we are, several years on, because the public perception is still very much that the regulatory function is not up to speed with the challenges of onshore oil and gas activity, whether shale or other unconventional oil and gas methods. That provides the Minister with an opportunity to look at the current work of the Office of Unconventional Gas and Oil, to turn a skeleton organisation into something that is far better resourced, far more robust and able to fulfil its six founding criteria, one of which was to enable development, protect the environment and safeguard the public. On that point in particular, I do not think that the work has been done with regard to the public perception argument or the regulatory oversight argument.
There is an opportunity to create an independent panel of experts—not another regulatory body or function—to consider the work of the regulators, interrogate the regulations that are in place from an independent perspective and ensure that the Health and Safety Executive, the Environment Agency, the Department of Energy and Climate Change, county councils and mineral rights authorities are working and have no gaps in their work. The people who sit on this body, which has to be funded by the Government, should be independent from the Government, and the application process to join such a body must be fair, open and transparent. At the moment, the perception of many people out there is that, although the regulatory function may be technically robust from an industry perspective, there are gaps. Only by creating a new panel of experts, as I have outlined, with some speed will we have an opportunity to try to address that matter.
Specifically in relation to Preese Hall and environmental monitoring, I believe that Lancashire county council suggested that the Environment Agency take on a minimum five-year process to conduct monitoring at Preese Hall, only to be told that, as a mineral rights authority, it did not have the power to enforce that decision. The Environment Agency appeared reluctant to take on the environmental monitoring facility and left it to Cuadrilla. I am not casting any aspersions on Cuadrilla’s integrity or the independence of its monitoring, but the public need to know that any monitoring is being done by an independent body, not by a company involved in the process. That is where the Environment Agency needs to step up to the mark. There has to be an obligation on it to provide all such environmental monitoring. To ask the company or companies involved to fulfil that role or task is unacceptable and does nothing to help public confidence; indeed, it is undermining the robustness of the regulations we are putting in place in the view of those people in favour of shale gas.
I have a final request for the Minister. If the Government have to put in additional resource and people into the environment and the regulatory process to advise local authorities on details of planning applications, for example, we must be prepared to do that, because if we do not Members of Parliament such as myself will find it difficult to support this process going forward. We will not allow anything to take place in our constituencies where regulation is not robust and inspections are not independent and are not unannounced, because anything short of that will really start to test the good will of MPs such as me and my hon. Friend the Member for Lancaster and Fleetwood (Eric Ollerenshaw).
I am pleased to speak under your chairmanship, Mr Gray, and I congratulate the right hon. Member for Lewes (Norman Baker) on securing this important debate.
I should make it clear at the outset that I do not support fracking, for all the reasons set out by others, which I will not repeat. Even in Denton, Texas, the home of fracking, in a recent referendum people voted to end it. Other states in the USA are turning against it because of environmental concerns. We should take note of these. If, even in the wide open spaces of the American west, there are concerns about the impact of fracking, how much more should there be in the densely populated UK?
A large area of central Scotland, stretching through to my constituency in Angus, has been identified as having potential for shale gas extraction. I shall confine my remarks to particular problems relating to the powers involved. Much of the power in respect of such developments lies with the Westminster Government rather than the Scottish Parliament. Westminster has the power to grant licences under the Petroleum Act 1998 to search for and develop shale gas, whereas local authorities and the Scottish Parliament have power in respect of planning matters, which clearly gives them some powers to restrict fracking.
I asked the Minister at the last DECC questions to confirm that the UK Government do not intend, whether through the Infrastructure Bill or otherwise, to change the planning powers in respect of fracking. I did so because I have become increasingly concerned about what exactly the interaction is between the powers under the Petroleum Act and those under the Planning Acts. This is very important, because the UK Government seem determined to have fracking and, with the changes made by the Infrastructure Bill, they are removing the right of landowners to object to fracking under their properties. It was also reported this week that the UK Government were funding the British Geological Survey to make investigative boreholes to demonstrate the viability of fracking. Will the Minister confirm that?
Does the hon. Gentleman agree that one way of dealing with the confusion between UK and Scottish Government responsibilities would be for the responsibilities under the Petroleum Act to be devolved to the Scottish Parliament—hopefully, under the Smith commission proposals due shortly?
The hon. Gentleman anticipates what I was going to say.
As well as giving the right to grant licences to persons seeking to explore for shale oil, section 7 of the 1998 Act provides:
“Subject to the provisions of this section, the Mines (Working Facilities and Support) Act 1966 shall apply (in England and Wales and Scotland) for the purpose of enabling a person holding a licence under this Part of this Act to acquire such ancillary rights as may be required for the exercise of the rights granted by the licence.”
The 1966 Act includes a right to
“enter upon land and to sink boreholes in the land for the purpose of searching for and getting petroleum”—
the definition of petroleum in the Act includes gas—and to use the land for specific purposes, such as erecting buildings, laying pipes, and so on, and provides for ancillary rights. The 1966 Act covers such rights, including lowering the surface, conveyance of gas or oil and a right to occupy the surface of the property, among other things. These are quite extensive rights that a licence holder would have and, rightly, these ancillary rights need to be set out by a court if agreement cannot be reached by the landowner.
My problem with all this is that I am not at all clear about planning in relation to fracking. If someone has, say, a lease from the UK Government to seek shale gas in a specific part of Angus, would they be entitled to go on to ground to do so, even if the landowner objected to it? Would these rights override planning permission or would they still need planning permission from the local authority and, if so, where does the landowner stand in all this? Is his only right the right to object to the planning permission? It seems to me that planning could only, in any event, cover the area on which the infrastructure for boring was placed, as it would be difficult to be sure about where drilling was being done, or how far into adjoining land it would go, until the operation was under way.
I would welcome the Minister’s providing some clarity about this. It seems to me that, even if the clauses in the Infrastructure Bill are defeated, the adjoining landowner would still be in a very weak position in relation to those wishing to frack, since they could at best delay development under their property, not stop it. There is a specific concern relating to Scotland, because this would override parts of Scottish land law, which is in fact devolved. There are already things in Scottish land law to do with minerals, including working with them, which would contradict some of this.
The Scottish Government have powers over planning in Scotland and have taken a much more cautious approach to the issue than the UK Government. They have called in the application from Dart Energy in Falkirk, have introduced changes in planning guidelines for unconventional oil and gas, and have—the right hon. Member for Lewes might be interested in this—introduced a concept of buffer zones in this regard. These measures have been welcomed by Friends of the Earth, among others. Hon. Members might be interested to hear that they have also convened an expert scientific panel to review the scientific evidence on fracking.
All powers relating to fracking, and indeed to everything else, should of course be moved from Westminster to the Scottish Parliament. I indicated to the hon. Member for Edinburgh North and Leith (Mark Lazarowicz) that all powers to do with fracking should certainly go to the Scottish Government. Later this week the Smith commission might surprise us and include powers over fracking in its remit. It would be right and proper for all such aspects to go to Scotland, where the Government of Scotland should reflect the views of the communities in Scotland where fracking may take place.
It is a pleasure to serve under your chairmanship, Mr Gray.
I congratulate the right hon. Member for Lewes (Norman Baker) on securing the debate, which I think is his first since leaving the Government. I am not surprised, having read parts of his website, that he has chosen fracking as the subject of his first such debate, because the tone and content of what he said in his speech are not inconsistent with letters I have seen that he has written to his constituents about the issue, including when he was presumably supportive of Government policy through collective responsibility, which I am sure he now feels relieved to be free from.
I am conscious that a lot of questions were directed at the Minister by the contributors to the debate, so I will endeavour to be brief to give him time to respond. He is interrogating his notes so that he can respond to a range of detailed questions.
The right hon. Member for Lewes succinctly ran through almost all people’s concerns, objections and issues over a long period. Some of his quotes were slightly selective, including his characterisation of the position of the UKERC, which takes the sensible and rational position that, potentially, unconventional gas has a role to play in the energy mix. It is right to warn, however, of the dangers of the way in which shale gas has been hyped and—I completely agree with this—oversold. The argument that it is a silver bullet to solve all our energy problems simply does not stack up. Frankly, some of the comments made by the Chancellor at his party conference a couple of years ago set the tone for discussion of the subject, which has meant that we have had a polarised debate, despite those of us who have sought to introduce a greater degree of analysis.
A lot of points have been made during this debate. My hon. Friend the Member for Nottingham South (Lilian Greenwood) talked about the public concern about a process that is not new, but has created a high degree of controversy, in part because of experience in the United States, which is different from the UK in terms of the rights of the landowners, the structure of the gas network and market and therefore the impact on industrial and consumer prices, and the regulation. A lot of the concerns expressed in this debate and others have been the result of limited or nonexistent regulation in the early parts of the exploration for shale gas in the US, but we are in a different position in the UK, and we should be.
In my view, shale and other unconventional gas and geothermal should happen only in a context of robust regulation and comprehensive inspection. The point made by the hon. Member for Fylde (Mark Menzies) was a good one—that bodies should have the resources to monitor regulation effectively. It is no good having a regulatory regime that ticks all the boxes and satisfies people without confidence that that regulation is being monitored. That applies to the Scottish Government, who made cuts to the budget of SEPA, the Scottish Environment Protection Agency, which is responsible in Scotland, as well as to the Environment Agency. That might not be an issue in the early stages, but if things ever get to any significant scale, it will become one, because those bodies will not have the resources to be able to monitor the regulation effectively.
Two and a half years ago, I set out a number of regulatory objectives that I thought needed to be met while a moratorium was in place. Some were met and some not. When the Infrastructure Bill comes to the Commons, I am sure we will have a debate about such objectives, but the important point to bear in mind is the public acceptability test, which might well go beyond what some deem to be strictly necessary to regulating an activity, given the analogous activity offshore. If we are ever to be in a position in which we can explore the issues, we have to ensure that the public acceptability test can be met. We will never satisfy those who have an absolutist and ideological objection to any fossil fuels at all—
No, I will not, because I am short on time.
Some people, including speakers in the debate, make the point that they are absolutely opposed to the use of any fossil fuels, or at least that their use should be minimised in our mix. Many others, however, are concerned about a range of different issues that have been highlighted today. It is crucial that such legitimate and local environmental concerns are addressed, that the wider regulatory points are properly robust and that we are in a position in which we can explore whether there is anything in shale gas for our energy mix in the future.
None of us in the room can tell the public or anyone how much shale gas can be recovered; we do not know, and we will not know until exploration happens, and exploration will happen only with greater public consent. We should be approaching the debate in that framework and not as though shale gas was a silver bullet for all our energy problems, the path to untold riches and a solution to all our problems at once. I very much doubt whether it ever will be those things, but perhaps it can make a contribution. For those reasons, we need to deal with matters in a cautious manner, which is the right approach to take in dealing with fracking and the potential resource of unconventional gas for the future.
It is a pleasure to serve under your chairmanship, Mr Gray. I will respond to as many points as I can in what has been a largely reasonable and reasoned debate. In particular, the short contribution of the Opposition spokesman, the hon. Member for Rutherglen and Hamilton West (Tom Greatrex), was commendable for its—
For its brevity, but also for its tone, which is similar to the Government’s tone—it is incumbent on the Government to explore the potential of that geological asset deep beneath the ground. The potential described by the geologists is great, but the question of how much can be extracted is as yet unanswered. It is necessary to find out that answer, but we have to do so reasonably, carefully and safely. I therefore take on board many of the points made by many hon. Members about regulation. We are working to continue strengthening what is already a strong and robust regulatory system.
My right hon. Friend the Member for Lewes (Norman Baker) started with the triumvirate of goals that sit atop energy policy: to ensure security of supply, to reduce carbon emissions and to encourage jobs and growth. Any Energy Minister presented with a potential opportunity to deal with all three together will of course want to investigate further. That is the potential behind exploring for shale gas.
First, the benefits of shale gas to energy security are clear and obvious. As a country, we are lucky that for 50 years we have been able to extract oil and gas from underneath the North sea. Just as there was a debate about whether to do that 50 years ago, there is now a debate about whether to extract resources from deep beneath the land. The answer with North sea oil was right: yes, we should explore, and we should do so within a strong and robust regulatory framework. That was what we did. The answer of 50 years ago is the same today with shale gas: yes, we should explore, and we should do so within a robust and clear regulatory structure. Shale gas could help our energy security, so that we may reduce our reliance on overseas energy supplies, which sometimes come from countries that are not friendly towards us.
Secondly, there is undoubted and clear evidence from the United States that, by replacing coal, gas can reduce carbon emissions. Gas has half coal’s carbon emissions per unit of energy. The debate about coal will continue, but being able to replace coal is nevertheless important.
Thirdly, if there is a clear supply of gas, that will encourage and support jobs and growth, because of the direct benefits that my hon. Friend the Member for Lancaster and Fleetwood (Eric Ollerenshaw) spoke about so powerfully. As he argued, there is a need for fair distribution of the resources from under the ground. The proposal for a sovereign wealth fund is an attractive one, and I look forward to working with him and others on the details of the design of that fund, to make sure that the allocation of those resources is fair. After all, if the exploration succeeds, there will be a substantial return.
There are questions about how that return is allocated: how much of it goes to the local population, how much to local authorities and how much to the national taxpayer? Who controls a sovereign wealth fund? How much goes to local communities and in what form? How much goes into paying for the exploration and production, which have costs? How much of it goes into paying for regulators? The point made by the hon. Member for Rutherglen and Hamilton West is important: if production gets going in a big way, the regulator will of course have to expand in scale. We are lucky, in that we are exploring for something of high value, so there will be revenue that in future can be used to provide exactly the sort of regulatory scale he talked about.
The contribution that my hon. Friend the Member for Lancaster and Fleetwood has already made to the debate on this issue is a strong one. We can see that in our discussion of the sovereign wealth fund. I pay tribute to my hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard), who has made that case strongly as well, as has my hon. Friend the Member for Fylde (Mark Menzies).
Several Members asked about the strength of the regulatory regime. It is undoubtedly stronger than the regime in the United States. Indeed, the environmental impact assessment for the Cuadrilla planning proposal that is outstanding in Lancashire ran to 4,500 pages. It is quite hard to argue that there is not enough detail in that.
Many hon. Members talked about public opinion. Polling from August was read out; that polling says that around a quarter of people support fracking. The same polling showed that about a quarter of people oppose it, and the vast majority of people are in the middle. That shows the importance of having an informed debate. To inform that debate, we have published a number of studies, including from the Royal Society, with incredible detail and length, and shorter resources by the Department and the Office of Unconventional Oil and Gas, such as “Shale gas made simple”, which bring out the salient details in a clear, short form for lay readers.
I am sorry that I was not able to speak in the main debate. The Minister has mentioned public confidence. If we look at, for example, the well examination schemes, they are not really fit for purpose. They are self-regulated by the operators. Where there are guidelines as opposed to regulations people will not have confidence. It is not a terribly difficult step for the Government to make regulations instead of guidelines and an inspection regime instead of self-regulation.
The regulatory approach is not one of self-regulation. There is clear statute and there are clear statutory guidelines that oversee the process. Statutory guidelines are in themselves a form of regulation.
Several hon. Members mentioned the leakage of fluids and methane from different wells that have been drilled so far. At Preese Hall, the well did not fail and the Health and Safety Executive has made it clear that it is satisfied with the steps taken by the operator to deal with the small pressure that was detected.
I pay tribute to the clear mind that the hon. Member for Brighton, Pavilion (Caroline Lucas) has on this issue, although I happen to disagree with her position, because I do not think that the best place for shale gas is underground. She said that she was disappointed that her parliamentary question went to the DWP. That happened because it was a question for the Health and Safety Executive, and the DWP is responsible for the HSE. She also referred to a point made by the former chief scientist. He said that shale gas was a problem in the absence of a climate change policy. Well, we have a climate change policy.
That brings me to a point raised by many Members, namely that exploring for shale gas—cautiously and carefully—is entirely consistent with building renewables and with having safe and secure domestic supplies. I bow to no one in my support for renewables. We have doubled the amount of energy coming from renewables—last year, 13% of our electricity came from them. The amount of investment in renewables—my right hon. Friend the Member for Lewes referred to that—demonstrates our support for them very clearly.
Does the Minister not recognise that the issue that really matters is how much fossil fuel is being burned and cannot be how much more renewable energy is being created if those renewables do not replace fossil fuels? My argument with him is that at the same time as creating some renewables—for which he gets some credit, although there are not nearly enough—he is anticipating a whole new fossil fuel industry. That is incompatible—the scientists say that it is—with the kind of targets we currently have on climate change.
I am afraid that a sweeping statement like, “The scientists say this or that,” undermines the hon. Lady’s case and shows that it is not based on a rigorous analysis of the facts.
I will make a couple more points in the three minutes I have left. My hon. Friend the Member for Warrington South (David Mowat) made a clear and balanced argument, and really put his finger on the issue: until we explore, we do not know how big the opportunity is. I sometimes felt that some Members did not know whether their problem was that there was not enough shale gas or that there was too much. Instead, the question we have to answer is how much shale gas can reasonably be brought out of the ground at a commercial rate under a strong regulatory regime. We need to explore because of the support that will give for jobs for the chemical industry, which many hon. Members mentioned, and because of the direct benefit for those involved.
My hon. Friend the Member for Fylde specifically mentioned both independent monitoring, which is important, and the independent panel of experts that he has called for. That is an interesting idea and I will look at it. I am constantly on the lookout for ways to reassure people that the exploration will be carefully monitored and will be done safely. For instance, my first decision in this job was to strengthen the planning guidance on national parks, which has dealt with many of the problems that my right hon. Friend the Member for Lewes is worried about.
The hon. Member for Blackley and Broughton (Graham Stringer) asked whether the gas can be retrieved in a way that is sensible and rational. The Opposition Front-Bench spokesman’s argument was about whether we can have robust and effective regulation, and he asked for reason and analysis in the debate on this issue. That is exactly the approach we should take and is the Government’s approach.
I firmly believe that the more well-founded, well-researched scientific analysis that is put in the public domain, the more we will be able to reassure people that shale gas represents an opportunity that it is incumbent upon us as a country to look at and explore and that that exploration can be done safely. It has to be done within a strong regulatory structure, but will none the less provide an opportunity for jobs, energy security and economic benefit and, in the short term, will tackle climate change by removing other dirtier fuels from the system, within the context of a balanced energy mix. I therefore look forward to working with all hon. Members to make sure that we get this matter right, so that we can take the advantages of the exploration, which are clear, but do so in a way that mitigates some of the risks that are undoubtedly there as well.
Bede Griffiths Charitable Trust and Southern India
It is a pleasure, Mr Gray, to serve under your chairmanship. It is good to see you again for the second time this morning—we had breakfast together.
On the evening of 15 December 2005, a young man called Tim attended a Christmas party in the City of London. Tim had recently left Chigwell school in Essex and was doing work experience before going to university. He was a decent, popular and intelligent boy at school, and he clearly had a great future ahead of him. At the end of the evening, he left the party, happy and sober, to travel from Liverpool street station to his parents’ home in Goodmayes. At the station, he took a late train home.
The next day, I was having lunch at the Army and Navy club with Dr Tony Pruss, an old school friend and also Tim’s father. Tony, his brother Adrian and I had all been pupils at Chigwell school and were reminiscing over lunch about the old days, as friends do. After lunch, just as we were leaving the club together, Tony received a mobile phone call from Mary, his wife. She was frantically worried because Tim had not returned home the night before. He would normally contact her to say where he was, but Mary had heard nothing.
Tony was instantly concerned and with good reason. Shortly thereafter, Tony and Mary were told that Tim’s body had been found alongside the railway track at Shenfield station. The world fell around Tony and Mary Pruss. Like any loving parents, they simply could not believe what had happened, but tragically it was the truth.
A few weeks later, I attended the inquest into Tim’s death in support of my friends, Tony and Mary Pruss. The coroner heard evidence that Tim had been hit by a train coming into the station having walked off the platform for some reason. Nobody knew why, but it might have been to excuse himself because, at the time, no lavatory facilities were open at the station. Tim was certainly not inebriated or drugged. The coroner heard evidence that Tim’s death must have been instantaneous—thank goodness. His death was deemed to have been a dreadful accident.
The death of Tim Pruss hit Chigwell school hard. As I have said, Tim had been hugely popular and a great character when he was there. The school was established by Archbishop Harsnett of York in 1629 and was very much a Christian foundation, and to this day takes its heritage very seriously. It has and continues to have contacts with missionary activities abroad and, at this time, particularly in an area of southern India called Tamil Nadu. There it supports the Bede Griffiths Charitable Trust’s work among the local people. Indeed, the school often sends out parties of students to visit, to learn and to try to help people less fortunate than themselves.
Tim Pruss had told his parents that he would like to go to Tamil Nadu but, as is the way with the young, he just did not go. However, Tony and Mary Pruss remembered that Tim had wanted to go there and it gave them the idea, too. They decided to look at the work of the Bede Griffiths Charitable Trust in Tamil Nadu and flew there. Once in India, they realised that they could help. They decided to use the money they had set aside for Tim’ education and inheritance to good effect. Shortly thereafter, the Tim Pruss Memorial school was established as a part of the Bede Griffiths Charitable Trust.
Bede Griffiths, the Benedictine monk after whom the charity was named, was born in 1906. He studied English literature and philosophy at Oxford and graduated in 1929. By 1932, he was a Benedictine monk and he ministered in England and Scotland until the early 1950s. He then joined a well-established Benedictine community in south India at Shantivanam in Tamil Nadu state. It was not long before people of all religions in the area came to regard him as a very special person and one whose views were well worth hearing. His Shantivanam ashram—a sort of cross between a monastery, centre of learning and community centre—became renowned principally because of Bede Griffiths. Although he died in 1993, his thoughts live on in his books and writings.
In this country, the Bede Griffiths Charitable Trust was established in 2004. To avoid confusion, may I point out that there is also a Bede Griffiths trust in the United States, but they are not linked in any way? The Bede Griffiths Charitable Trust has the specific task of helping to fund worthwhile projects in and around Shantivanam. The main aim of its projects is to help some of the most deprived people who live there.
Bede Griffiths Charitable Trust projects focus on education and training, with particular support for children, women and the elderly. For example, last year the trust did considerable work in Tamil Nadu state. The biggest project was the Tim Pruss Memorial school, but there were a few other equally worthy activities, such as providing educational expenses for children; provision of milk and rice for the poorest people, and of food and clothing for the elderly; and the running costs of a kindergarten, a tuition centre, a community centre and a home for the elderly. In 2013, the trust received more than £37,000 from donations and charitable events. The majority of that money—£23,000—went to the Tim Pruss Memorial school.
Early each year, the trust managers in India submit an application to the trustees for grants for their financial year commencing in April. Applications are normally accompanied by a financial statement of the project’s income and expenditure in the previous year and, of course, audited accounts. The trustees, some of whom are not far from me at the moment in the Gallery, visit Tamil Nadu at their own expense once a year on average, and the project managers show them where the money they have raised and donated has been spent. In addition, evidence is gathered by regular updates from the relevant project managers. The work of the charity is undertaken entirely by volunteers, with the result that there are very few overheads and that 98% of the income raised goes directly to supporting activities in Tamil Nadu.
The Tim Pruss Memorial school is at Inungur, which is a remote area where pupils have great difficulty in getting to a Government school. They are taught in English and are well funded by Bede Griffiths Charitable Trust grants, as well as by a small number of contributions from individual donors.
The school has 275 pupils aged between three and 11 years old. It provides an English-based education under the leadership of the headmaster, Mr Senthil Kumar. Obviously, the biggest costs are staff salaries, which come to close to £23,000 per annum. Parents make a small contribution where they can. The school has been operating since 2007 and has expanded one building at a time. After an initial grant of £7,000 in 2008, a junior school building was erected, and by 2009 it was officially named as the Tim Pruss Memorial school. In 2012, Tim’s brother, Michael Pruss, who is also an old Chigwellian, raised a further £10,000 by running a marathon in Long Beach, California. He is something to do with the film industry, and quite powerful in it. The money he raised was used to build a new hall. Of course, Tim’s parents, Mary and Tony, have played a key role in all the developments.
One of the founding trust members was the Rev. Dr Chris Collingwood, then Chigwell school chaplain. It was he who invited older pupils and parents on an annual school trip to experience life in the Indian subcontinent, particularly after the 2004 Boxing day tsunami. During those visits, pupils saw the work of the trust in some of the projects in the local community and around Shantivanam. Chigwell school continues to support the trust and send annual trips to Tamil Nadu. The students learn a lot during such visits. To start with, they get to understand a little of India and its geography, climate and people. They also experience life in the Christian monastic community at the Shantivanam ashram, where they stay. They are encouraged to join in at least some of the chapel services, and to attend some of the talks that are led by the priests and lay brothers who live at the ashram. Most of all, they see the positive effects of social projects in poor rural areas.
In 2013, those on the Chigwell school trip completely redecorated the older part of the old people’s home, an old house that had become drab and dirty. The students brought paint with them and, under the supervision of a qualified surveyor, completed the decoration within a day. Eighteen students, six parents or former pupils, a school governor and two trustees went on a self-financed trip to Tamil Nadu. A multi-purpose hall for meetings and school meals in the Tim Pruss Memorial school has been built with more than £14,000 raised by fundraising and donations. Additional money has been allocated by the trust to cover the running costs of a tuition centre, two kindergartens, a home for the elderly and two centres training adults in typing, computing and tailoring.
The home for elderly people established by the trust has 17 residents, of whom one is a Muslim and one a Christian—the remaining 15 are Hindu. Fourteen of the residents are from local villages but three are from further away. The home is an old house with a new block providing accommodation behind it. The £13,000 to build the new block came from one donation from a Chigwell school family. Since then, the Bede Griffiths Charitable Trust has helped towards the running costs of the home by contributing £1,000 a year. Residents live in twin single-sex rooms in the new block but come together in the old house for meals and social events. A warden and a part-time assistant run the home.
Recently, a gift of more than £1,500 enabled a brick-built home to be constructed following a fire that destroyed a single-parent family’s home, which had been constructed from wood and leaves. Altogether, around 15 homes have been built following trust donations. However, Chigwell is not the only school involved in fundraising for the trust. The Prince’s Mead school in Winchester, whose head teacher is Ms Penelope Kirk, has also been a terrific donor. It supported the school when it was just one small building, prior to 2007, and continues to do so. I should declare my interest in the Bede Griffiths Charitable Trust: recently, because of my friendship with Dr and Mrs Tony Pruss, as well as my links to Chigwell school, I was asked to be involved and am now a patron.
I should like to say how fitting and appropriate it is that my hon. Friend the Member for Bexleyheath and Crayford (Mr Evennett), who is the pairing Whip and a very good friend, is replying to the debate. By chance, his son Tom, who also attended Chigwell school, was a good friend of Tim Pruss’s brother, Michael, whom I mentioned on account of his raising a lot of money for the Tim Pruss Memorial school. In a way, this is rather a family occasion all round.
The charity is clearly exceedingly well run by its trustees, who are Adrian Rance, the chairman, Mark Bradbury, the secretary, Greville Norman, the treasurer, Tony and Mary Pruss, Helen Dixon, who is in the Gallery, Elizabeth Tysoe, Pippa Mistry-Norman—also at Chigwell—and David Gower, second master at Chigwell school. I hope the debate will raise the profile of the Bede Griffiths Charitable Trust. I commend the trust to the House and ask the Department for International Development and the Foreign Office to note the excellent, well supervised work being done by that great charity.
I congratulate my constituency neighbour, my hon. Friend the Member for Beckenham (Bob Stewart), on securing this important and timely debate. I commend him on his excellent, thoughtful speech, and apologise for the absence of my right hon. Friend the Minister of State, Department for International Development, who is appearing at the Select Committee on International Development this morning. I have been asked to respond as the DFID Whip, and am delighted to do so on behalf of the Government.
I offer my condolences to Tim’s family on what was a tragic loss for them and his many friends. I know Chigwell school, as my hon. Friend mentioned, because my sons Mark and Tom both went there, and I went to the neighbouring grammar school, Buckhurst Hill county high school for boys, which was next door but is now sadly no more.
We have today learned an awful lot about the Bede Griffiths Charitable Trust and its work, and the problems of southern India. We have also heard about Tony and Mary Pruss’s dedication. I commend them for their endeavours in memory of their son, and for their huge contribution to helping the less fortunate in Tamil Nadu state. The trust does vital work there. We have heard about its important provision for the poorest people, those who are suffering, the elderly and the young; and about its support for local community facilities. The Tim Pruss Memorial school in Inungur is helping 275 pupils in a remote area of the country who would otherwise have had great difficulty in going to a Government school. Those are positive, constructive approaches to assist a part of the world with considerable disadvantages.
As my hon. Friend the Member for Beckenham knows, the Government have made a commitment to international development, and I am proud that Great Britain was the first G7 country to reach the target of 0.7% of national income for aid spending. Not only do the Government play their part in helping a variety of causes globally, but the great British public also do their bit to support those aims. One need only think of the extraordinary response to the Philippines appeal after Typhoon Haiyan last year, or the millions donated to help tackle Ebola in west Africa in the past few weeks. We as a country can be proud of the contribution that our people are making in voluntary donations.
One can also see that compassion and dedication clearly in the sheer number of fantastic civil society organisations in this country, such as the Bede Griffiths Charitable Trust, that make a difference in the developing world. Working with civil society organisations forms an integral part of DFID’s approach to reducing poverty, promoting wealth creation, achieving the millennium development goals, tackling climate change and dealing with conflict.
Civil society can play an important role in reaching poor and marginalised people and communities in places that the Government and private sectors have not been able to reach. They do so through their ability to build relationships, trust and legitimacy, their grass-roots knowledge of needs in developing countries and their responsiveness. It is a crucial part of creating the open societies required for tackling poverty and its underlying causes and creating economic growth and development. Many smaller and medium-sized groups such as the Bede Griffiths Charitable Trust are more out of sight and perhaps receive less fanfare, but they do powerful work on the ground, which is why debates in the Commons to highlight them are important. The good work being done needs to be recognised and publicised. My hon. Friend has done a marvellous job in doing so today.
There are many organisations running projects that no one else thought of doing. In fact, it is often smaller grass-roots organisations that can make connections on the ground and help to change how people act for the better. Of course Government support is vital, which is why the UK Government support smaller civil society organisations through DFID’s global poverty action fund, which provides grants to charities across the UK to help them fight poverty in the world’s poorest countries. For example, the charity Women and Children First UK is helping reduce maternal and newborn mortality in Mumbai.
Such schemes have achieved great results, supporting some fantastic organisations, which is why UK Aid Direct was launched, a new £150 million funding scheme to support small and medium-sized national and international civil society organisations in reducing poverty over the next five years. As a successor to the global poverty action fund, UK Aid Direct will build on the success and momentum created by that fund. It will also bring more flexibility and allow the work with civil society to respond to opportunities as they arise. The scheme highlights DFID’s ongoing commitment to the role of civil society in poverty reduction and recognises the important contributions made by small and medium-sized civil society organisations.
Applications for the first £30 million funding round for UK Aid Direct closed today. In the first funding round, projects will focus on finishing the job on the health millennium development goals, and particularly on sexual and reproductive health and rights. It is a particularly important focus for development at this time, as the MDGs for reducing child mortality, improving maternal health and combating HIV/AIDS and other diseases are off-track. DFID is looking for innovative, ambitious projects whose proposals will demonstrably have a tangible impact on our efforts to achieve the off-track MDGs.
I note my hon. Friend’s plea. I know that my officials have listened to it, and I will respond in a moment.
The poorest areas civil society programme works with Indian civil society organisations in the seven poorest states and helps socially excluded groups claim their rights. The programme has led some impressive initiatives, such as the campaign for complete abolition of the inhuman practice of manual scavenging, a caste-based practice in which human excreta are cleaned manually by individuals from the Dalit and Muslim communities in India, who face untouchability and social exclusion.
Faith-based organisations such as the Bede Griffiths Charitable Trust play an important part in reducing poverty in developing countries. Religion unquestionably plays a role within civil society, and we can use that to help advance the development agenda. Faith is often part of individual or group identity, which gives faith groups considerable legitimacy; they are often seen as more embedded in the local community than some development actors. Faith groups inspire confidence and trust. Indeed, they are often the first groups to which the poor turn in times of need and crisis, and to which they give in times of plenty. Faith communities can be motivated by different ethical values and beliefs from most secular organisations, including a sense of service, selflessness, generosity, mindfulness and compassion. They are often less transient than many secular civil society organisations and can mobilise many adherents and significant financial resources. Faith groups make a significant contribution to poverty reduction.
I now have an answer to my hon. Friend’s question. We are happy to provide information to him, so that the trust can get in touch after the debate. I cannot promise any more than that, but we in the Department are always willing to consider any opportunity.
Faith groups are a key development partner. They empower poor people so that their voices are heard. They can subject Governments to critical scrutiny and bring distinct and valuable perspectives to policy formulation processes. To strengthen our relationship with faith groups, the UK Government have launched the faith partnership principles paper, and we are working with faith groups to ensure that those principles are put into practice. The paper sets out the principles—transparency, mutual respect and understanding—that will guide our relationship with faith groups, as well as plans to build a common understanding of faith and development, document the impact of faith groups through systematic research and discuss areas of difference in a constructive way without threatening wider collaboration. DFID’s work with faith groups over the last 10 years has benefited many millions of men, women, boys and girls. My hon. Friend referred particularly to the generosity, commitment and hard work of Tim’s family, the trust and others with counterparts in India.
India has grown rapidly in the last decade and is now one of the world’s major economies, but remains home to one third of the world’s poor. In recent years, India has rapidly increased its spending on health, education and other development issues. In recognition of India’s changing place in the world, the Secretary of State for International Development announced in a statement to Parliament in November 2012 that we have agreed with the Government of India to move to a new type of development relationship. After 2015, our partnership will focus on sharing skills and expertise, making private-sector investments that will help the poorest people and generate returns, and strengthening partnership on global development issues such as food security and climate change.
UK aid is delivering results in India; for example, it is reaching out to 3.6 million pregnant women and to children under five through nutrition programmes, and will give roughly 2 million people access to improved sanitation by 2015. This Government are assisting civil society organisations of all shapes and sizes in playing a critical role in fighting poverty, and we will continue to do so. The world has made unprecedented progress in the fight against poverty in the last two decades.
In this debate, with a great deal of interest, we have learned all about the Pruss family and their commitment, the Tim Pruss memorial school and the Bede Griffiths Charitable Trust. I am pleased to acknowledge the trust’s commitment to making a difference, and the time and effort given by Dr and Mrs Pruss and all those involved in this important charity. I hope that we have been able to put on record the work that has been done; my hon. Friend the Member for Beckenham has done a superb job in doing that. After this debate, we in the Department will certainly consider in what ways we might assist, but the most important thing is to congratulate the trust and all involved in it, and to support it in continuing the good work that it has done so far.
Personal Independence Payments
[Mr David Crausby in the Chair]
It is a pleasure, Mr Crausby, to serve under your chairmanship this afternoon. I am grateful to have been granted this debate on the processing of personal independence payments. As in the constituencies of many of my colleagues, concern about the time taken to process PIP payments has been significant in my constituency. Several cases that have been brought to my attention are both shocking and heart-wrenching. I am here today to represent constituents who have come to me in despair for their stories to be heard. I know that many right hon. and hon. Members throughout the country have constituents in similar situations. I thank the organisations that have contacted me recently to tell me about their work and some of the challenges faced by the people they help. They include Macmillan Cancer Support, Scope, Mencap, the Muscular Dystrophy Campaign and Parkinson’s UK.
I believe there is strong support in this country for a social security system that helps people to get by when they fall on hard times, and that provides dignity and a decent standard of living for those who are unable to work because of sickness or disability. Before being elected, the Prime Minister said:
“The test of a good society is you look after the elderly, the frail, the vulnerable, the poorest in our society. And that test is even more important in difficult times, when difficult decisions have to be taken, than it is in better times”
yet, four and a half years on, life for disabled people is harder than ever. They have been among the worst affected by the Government’s decisions.
As the House has heard, the delays in personal independence payments are a serious problem, not only for my constituents in Bolton South East, but for people throughout the country. They are desperate people. Many of them have worked and paid into the system for years, but have been struck by disability or illness and forced to wait months for help from the Department for Work and Pensions.
PIP is a non-means-tested benefit available to people suffering ill health or with a disability. It is intended to help those who receive it so that they can cover the additional costs that will inevitably arise from their condition, whether they are working or not. It is important to remind the House that life costs more for those who are disabled. There may be additional costs for special food, medicines, equipment, extra heating and lighting costs for those who need to stay at home longer, and transport costs for those who are less mobile. Such extra costs are not luxuries. They are essential to a life of dignity, and any civilised society should make it a priority to see that people who need such help get it without fuss.
A constituent of mine who has cancer and lost the use of her legs was one of the 720 people in Newport East with an outstanding claim. She was paid in October. The payment was approved in August, but it took until October to pay her, with no backdating. Does my hon. Friend agree that the Minister should address that point, because it is outrageous that we should leave people that long with no backdating?
I entirely agree with my hon. Friend. The crux of the problem is delay, not only in the assessment programme, but in giving the money. I will speak about a constituent in a similar situation to that of her constituent.
A recent Scope research paper shows that the costs add up to an extra £550 a month. Some costs cannot be avoided, but disabled people too often continue to pay over the odds for everyday items and services. The Government must guarantee that the value of PIP keeps up with disabled people’s extra costs. For example, placing a triple lock on PIP, as the Government have done on pensions, would ensure that its value is maintained and build the financial resilience of disabled people. PIP is the financial lifeline that disabled people rely on to help to meet those costs. Instead, its processing has brought distress and hardship to some of the most vulnerable people. Sadly, the Government have completely failed to remember the human impact. Behind the bureaucratic language and spreadsheets are enormous backlogs of ordinary people in need who are being let down and mistreated. I will give a few examples, which I am sure will be familiar to colleagues and their constituencies.
Mr and Mrs Booth came to my advice surgery in March. Mr Booth had had a stroke in August 2013. He was paralysed on his right side. He had been waiting for an Atos assessment since September 2013. PIP is a passport to other benefits and his wife could not apply for carer’s allowance until he received PIP. Mr Booth told me that he was being summoned to court the following week, and that he faced having his home repossessed because he could not repay his mortgage as a result of not being able to access benefits. He was receiving only statutory sick pay, and his future was hinging on the Atos assessment.
I wrote to the Secretary of State on 3 March and highlighted Mr Booth’s case. A week later, the judge adjourned the repossession order for two months to allow the situation with Atos to be resolved. By the time Mr and Mrs Booth revisited me at my surgery in July, Mr Booth had had his assessment in May, but they were still waiting. They had contacted DWP twice. It had assured them that the matter would be dealt with soon. Clearly that was not the case. I contacted the right hon. Member for Hemel Hempstead (Mike Penning), then Minister of State, Department for Work and Pensions, urging him to look into the case as a matter of urgency. I received a response at the end of July, which addressed some of the issues I had highlighted. The letter stated:
“I am sorry for the time it has taken to process Mr Booth’s PIP claim of 12th September 2013. There was an initial delay in forwarding it to Atos, the assessment provider, because we needed to validate the claim and this was not completed until 17th October. The delay in arranging for this to be done is regrettable. Unfortunately, experience so far has highlighted that in many cases, the assessment process has been taking longer than expected. We are continuing to monitor this closely and we are working with the assessment providers to try and reduce the time they are taking to complete their part of the processes.”
That was unfortunate and regrettable for Mr Booth. He was given a back payment of £4,694.37 for the 10 months he had waited, but it came too late for him. His home was repossessed and he and his wife had been made homeless by the negligent delay.
A second constituent, Ms Sylvia Syddall, contacted my office on behalf of her husband who had suffered a heart attack and three subsequent strokes. She had made a claim to cover the additional costs to support her husband. Atos first informed Ms Syddall that her claim had been received four months after the initial application was made to the DWP, and 16 months from the present day. Several administration errors followed, and Atos insisted on a medical assessment, despite being given much medical evidence stating that Mr Syddall was severely ill and had been hospitalised for a prolonged period, and was unable to feed and wash himself. However, the delay continued for weeks. Atos kept insisting that it would do a medical assessment despite there being so much staff medical evidence staring it in the face and telling it exactly what was wrong with him. Sadly, Ms Syddall’s husband passed away without his PIP payment ever being processed and completed. His wife had been paying for the additional costs herself and sadly, she did not even have enough funds to pay for his funeral. Sixteen months on, Ms Syddall is without her husband, without having received any payments. It is a particularly troubling case, demonstrating the consequences of the deeply flawed process that we seem to have at the moment and how such delays are hurting the most vulnerable.
Let me give a third example. Mr Darius Pope is a young disabled constituent, confined to a wheelchair after a road accident. He suffers depression. He is now suffering at the hands of Atos and from over six months of the DWP chaos. Will the Minister tell me what I, as an MP, should say to a constituent such as Mr Pope, who is faced with such considerable stress and anxiety from the processing of his personal independence payment application that he tells me he would take his own life if it were possible for him to walk out of his wheelchair? This constituent has contemplated suicide. The additional costs of living are so burdensome that he has to borrow money from his parents, which is not a great situation—that relationship has become increasingly strained.
Those are just a few of the appalling cases from constituents who have allowed me to share their stories, but there are many others. As I have said, I have no doubt that such stories are replicated throughout the country. When I posted about this debate on social media, I was inundated with stories from across the country.
The concerns do not just come from my constituents or colleagues. In a report published on 27 February 2014, the National Audit Office said that the “poor” early operational performance had led to long delays and uncertainty for PIP claimants. It said that the Department had failed to allow sufficient time to test the new system and that unexpected delays in the assessment process had led to a large backlog of claims. The NAO recommended that the DWP set out a clear plan for informing claimants about the likely delays they would experience while plans to improve performance took effect. I ask this question now and will ask it again later: will the Minister today confirm what progress has been made?
Back in April, in a similar debate on personal independence payments in Wales, the then Minister admitted that there were delays in all parts of the process, including at the DWP end. Does my hon. Friend believe it is important to hear from the Minister today how much of that delay in Wales is Capita and how much is the DWP, and what he and the DWP are doing to speed up the process at the DWP end, which he is responsible for?
I entirely agree with my hon. Friend, and I hope the Minister has heard what she says—she echoes a concern that others have about the delays.
The tragic part of the situation is that everybody says, “Yes, there are delays,”—we have been hearing that since last year—yet when the pilot project was rolled out, why was it not rolled out on a smaller scale? Why were proper resourcing and staffing not given to the new system of assessment? Surely people must have known that when a new project is rolled out, there will be teething problems. The purpose of pilot projects is to see what happens, so why not do the pilot projects on a small scale? Why not make sure that the resources are there to deal with all the eventualities and problems? Why carry it out on such a massive scale that we end up with those backlogs? The backlogs are still there. It may be a naive solution, but why does the Department not employ more people who can process applications? Why does it not tell Atos to speed up its assessment process? I cannot believe that in the 21st century, in the country that we live in, such things cannot be expedited. For months and months we have been hearing the same story—“Yes, there are delays, yes, there are delays”—but there are solutions, and it seems as if nobody in the Department of Work and Pensions or other Ministries is bothering to listen or trying to deal with the solutions. It is almost as if lip service is being paid by everybody—they say, “Yes, there are delays; we are dealing with it,” but nothing has been done.
The Work and Pensions Committee and the Public Accounts Committee have described services to PIP claimants and the length of time people must wait for decisions on PIP claims as unacceptable. The Chair of the Public Accounts Committee rightly said:
“The implementation of Personal Independence Payment has been nothing short of a fiasco.”
I am pleased that the Minister recently acknowledged that the situation is not satisfactory and is working collaboratively with the assessment providers to improve performance and reduce the backlog of claims, but I would still like to ask him this: why should sick people have to pay the price for his maladministration?
Data released by the Department show that, of the 529,400 cases registered for the personal independence payment between April 2013 and the end of July this year, just over 206,000 have been cleared—either awarded, declined or withdrawn. However, the figures do not reveal how long those individuals had been waiting in that 16-month period when PIP was first introduced. Why are the Government not disclosing data on waiting times?
Before the summer, the Secretary of State reassured the House that, by autumn 2014, no PIP claimant would have to wait more than six months, and that, by the end of the year, no one would be waiting for more than 16 weeks. However, I was disappointed that the Department is working towards reducing its waiting times to 16 weeks to assessment rather than to payment, as first implied by the Secretary of State. Based on that time frame, the absolute earliest that a claimant could expect to receive a decision would be after 18 to 20 weeks, which is not acceptable.
In any case, autumn has passed, but I still have cases of constituents who have been waiting for more than six months. The end of the year is fast approaching. Will the Minister tell the House why he was not able to meet the autumn target for the constituents of Bolton South East, and how he intends to achieve the end-of-year target?
The situation is not getting any better; it is getting worse. People are facing major delays with both Atos and Capita to secure face-to-face meetings, and it is taking far too long for Atos and Capita to report after assessments. The longer those problems persist, the more long-term the impact. What is the Minister doing to ensure that his Department’s contractors provide an acceptable service to claimants?
Fightback is a local charity in my constituency that helps a considerable number of constituents. It reported to me that its helpline has been inundated with disabled people phoning for advice. It has received almost 50 calls on PIP delays in a day. Many are facing extreme delays of well over six months.
If the Department has revised its assumption, will the Minister set out the end-to-end process of PIP claims and how much time each part of the process takes? Does he agree that it is right and proper to ensure that disabled people, including those affected by cancer, receive financial support as quickly as possible, and that 11 weeks to payment, as suggested by Macmillan, is a more acceptable time to wait?
What struck me as unusual when carrying out the research for today’s debate is the reason why the Government have not published for more than a year the average length of time it takes to process PIP claims for normal and special rules as part of their quarterly statistics. In the interests of transparency, will the Department publish clearance and waiting times to demonstrate that claimants are waiting no longer than 16 weeks to assessment, in line with the current aspiration? Considering that the benefit has been in place for a year, why is it taking so long to provide a rounded and representative picture of PIP performance, improvement activity and claimants’ experience?
Earlier, I explained that my constituents Mr Pope and Mr and Mrs Booth had fallen into burdensome debt because of the additional costs of disability. A Scope report shows that they are not alone. I do not know whether the Minister is aware that statistics reveal that the disabled are twice as likely to have unsecured debt such as payday loans and credit card debt, and debt such as logbook loans. Such debt often totals more than half their household income. Even the Government’s research has shown that the disabled are over-represented among high-cost borrowers: 18% of disabled people use that type of credit, compared with 5% of non-disabled people. That prompts the question: why is a group that is already vulnerable to financial pressure being “looked after” by legal loan sharks and doorstep lenders, not the Government?
As we know, debt does not just make day-to-day living harder for Mr Pope and others. It is impossible for people to plan for the future when they cannot be sure whether they can keep a roof over their head. Debt narrows their horizons. A disabled person’s debt problems are only compounded by the additional difficulties they will have in finding work that is suitable for them.
I hope the Minister uses this opportunity to answer the questions I have asked and to explain what he and his Department are doing to make the system easier for claimants. We have heard in the past acknowledgement from him and others that the delay is unacceptable and more must be done to address it, but what specific actions have been put in place to do that?
The essence of the debate is common human decency and treating people with dignity and respect. Certainly in the case of PIP, many hundreds of thousands of people in our country have failed to be protected by the Government. I look forward to hearing the Minister’s response with concrete information on what they have done so far and concrete proposals on what they will do to deal with the backlog.
I should start by explaining why I am lisping. I have just had major dental treatment. I apologise, but it is really uncomfortable.
I congratulate my hon. Friend the Member for Bolton South East (Yasmin Qureshi) on obtaining the debate. Such a debate could take place almost daily, because every MP will have a considerable number of constituents who have been deeply affected by the process that they are having to go through. I have a long list of constituents who have faced significant delays or who have been told that they must travel to places such as Portsmouth, which is three and a half hours from Plymouth, for assessments. Others turned up for assessments in Tavistock, which is nearer—20 miles away—only to be told on arrival that the assessment had been cancelled but somehow there had been a failure to inform them. The individual I am thinking of applied in January and, before the abortive visit to Tavistock, was told that his file had been lost. All these individuals are extremely anxious and vulnerable. If we add those having difficulty with the employment and support allowance system, the number rises again.
Let me just mention Mrs P. She does not want to be named. She is vulnerable and, like many of my constituents, is anxious about her name being in the public domain. I have in many of these cases already written to the Department for Work and Pensions. Mrs P applied many months ago. She has had, and continues to have, major cancer operations on her lung, liver and bowel. She had to postpone the last assessment because of a lung operation. Atos has confirmed that cancer sufferers cannot escape assessment unless terminally ill. This lady is extremely ill. We chased the assessment, and it happened. She is waiting for the DWP to produce a decision and was told that that could take up to 26 weeks. In some cases, we are now looking at almost a year from applying to receiving a decision, and as we have already heard, some people do not live long enough to hear the outcome. That is utterly unacceptable.
I shall focus today on one particular group—people with muscular dystrophy. I am a member of the all-party group on muscular dystrophy, and a number of constituents have approached me at different times with issues specific to this disease. Most people in this Chamber will know that the term “muscular dystrophy” describes about 60 mostly genetic conditions. The Muscular Dystrophy Campaign has highlighted to me a number of individual cases, including a lady who had her assessment in the summer of 2013 and was told only this month that she had been lost in the system.
The Muscular Dystrophy Campaign was told at a meeting with the DWP that the delays at Atos were attributable in part to under-staffing issues. It would be interesting to hear from the Minister whether that position has changed or improved to deal with some of the backlog.
I certainly had a constituent who, when they complained about delays, was told by staff that they could not do anything about it because there were not enough staff on and to contact her MP if she wanted any action at all. Is it not sad that people waiting in this situation should have to contact their MP, rather than just receiving the payments that they are due?
My hon. Friend is absolutely right. As was pointed out earlier, rolling out a scheme on this scale without having piloted it has contributed to some of the misery that is being caused around the country.
The MD Campaign has also raised the case of a 16-year-old with Emery-Dreifuss muscular dystrophy and a serious heart condition who simply failed to get through on the telephone. She tried and tried, and it caused her and her grandparents, with whom she lives, major concern. Just accessing the system can be unbelievably difficult for people.
For this group, the 20-metre rule is one of the most controversial elements. It replaced the 50-metre rule. Many of those with MD-related conditions can, on a good day, make 20 metres, but, because the disease is progressive, they can quite quickly not be able to walk 20 metres, even with sticks. The evidence from people with muscular dystrophy is that the wider discomfort issue is not considered by those who make the assessments. An individual may well be able to walk 100 metres, but 80 of those metres are absolute agony. No reference is made to that; no consideration seems to be given to it. Equally, there are issues about the surface on which they are walking. They may well be able to do 20 metres on the flat, but if they are asked to do 20 metres uphill or on an uneven surface, it becomes impossible. I just do not think that the regulations and guidance as currently set out protect individuals in those circumstances.
Worryingly, discussions with people with muscle-wasting conditions post-assessment have led the MD Campaign to have serious concerns about the lack of knowledge of this type of progressive condition among the assessors. For example, one lady with a long-term and progressive neuromuscular condition was told that she “may get better”. Sadly, she will not. The degree of ignorance in that case was worrying. There are also examples of gross insensitivity, which I am sure the MD Campaign would be willing to pass on to the Minister if he wanted to hear them. For example, one person was congratulated when they fell over. I find that insensitive to the nth degree.
I would be grateful if the Minister explained why some assessment centres are inaccessible, because there are a number of examples of people being invited for interview and then discovering that the interviews take place on the first floor of the building, up a flight of stairs. That might be a sort of secret test—an attempt to catch people out—or simply very bad planning, but perhaps the Minister will be good enough to look at access to the various centres.
I fully understand the need to ensure that only those entitled to support receive it, and most of my constituents accept that principle. However, the process is still failing too many people. The Government clearly underestimated the size and complexity of the problem, and the contract was let without care being taken to ensure that the company carrying out the assessments actually had people with the right skill and understanding to deal with some very rare conditions and vulnerable people.
The Government may not be disclosing data on waiting times, but in closing I ask whether the Minister can tell us what percentage of claimants have seen their files recorded as having been lost since PIP was introduced. Can he explain why the 15th largest city in England, Plymouth, with an ageing and disabled demographic, has no adequate facility for assessment and people have to go as far as Portsmouth?
I appreciate the opportunity to say a few words. I congratulate the hon. Member for Bolton South East (Yasmin Qureshi) on securing the debate for us all to participate in. I am pleased to follow the hon. Member for Plymouth, Moor View (Alison Seabeck), who delivered her speech eloquently despite her current impediment, and we thank her for that.
Personal independence payments are of great importance to me and my office. One member of my staff now deals with nothing else besides benefit claims, which includes claims for disability living allowance, employment and support allowance, income support and the whole raft of benefit claims. I suspect that that situation is replicated in hon. Members’ offices across the United Kingdom. Many of us have a staff member who is tasked with dealing with such matters every day, because of all those difficulties. In the few minutes that I have, I hope to illustrate the situation through the experience of my office.
We understand the reasons for the changes, and the Government have set out their stall when it comes to reducing benefits through universal payments to ensure that changes will be made. We are aware of cases of people receiving payments when it is questionable whether they qualify for them, and we understand that that issue must be tackled. However, the people whom I will speak about today are those who clearly should have the payment and are feeling the difficulties of the new system.
In the same way as DLA did, PIP helps towards some of the extra costs that arise from long-term ill-health conditions or disability, and it is based on how a person’s condition affects them rather on the condition that they have. Every time someone comes to me about the benefit, I always say that it is about the help that they need, not entirely about their illness. It is about the help that they need in the house, how the illness affects them and whether they need people to come in and help them. When they get their head around that, they understand the importance of explaining their condition and highlighting the symptoms or problems associated with it. Every person is different, and they are affected in different ways. The previous system fell down many times, and the new PIP system unfortunately has the potential to do likewise.
The individual assessment for PIP is much stricter than the assessment for DLA, but the aims are the same: to ensure that people with health needs or disabilities can lead an independent life, while getting some extra help along the way. The stricter measures are intended to ensure that the system cannot be abused, in view of the budget constraints we all face across the United Kingdom. The changes from DLA to PIP will involve a face-to-face consultation with an independent health professional as well as regular reviews to ensure that an individual gets the right support. I welcome the face-to-face consultation, because I hope that it will better enable assessors to determine an individual’s circumstances. I often wonder, “Have they ever met these people? Do they understand their circumstances? Do they know what it is like to be unable to move about in your own home, to have restricted movement or to be dependent on someone else to help you?” The face-to-face consultations have the potential to lead to improvement.
To receive PIP, an individual will be assessed against reliability criteria to test whether they can carry out certain activities safely, to an acceptable standard, repeatedly and in a reasonable period. I can relate so well to the words of the hon. Member for Plymouth, Moor View. Someone may be able to walk 60 yards, but they will be in pain. Most of the people who come to me about DLA are in pain with their first step, but they endure the first 20 or 30 yards and then they have to stop. We need to have a system that adequately takes that into account. I hope that under the new system of PIP, it will be easier to ascertain and understand the problems that people are experiencing and resolve them urgently. We are having this debate because, quite honestly, the issues are not being resolved urgently; indeed, the opposite is true.
As PIP is being rolled out, some strange delays are occurring and some of the most vulnerable are not receiving any help. I want to highlight some of the delays that are affecting my constituents. First, they are anxious about their health. They become anxious about their PIP, and then they become anxious about all the other benefits that swing off that. Perhaps the Minister could give me some indication of how we can hurry or quicken the system. As a result of all the anxiety and concern that they experience, people’s health often deteriorates. They sit in an in-between world between today and tomorrow, almost hanging in space, hoping for their claims to be processed. All the time, it affects them greatly.
In February this year, only one in six people who had made a claim for PIP had received a decision. As the hon. Member for Bolton South East mentioned, the National Audit Office stated that poor early operational performance had led to long delays and uncertainty for PIP claimants. The right hon. Member for Barking (Margaret Hodge), the Chair of the Public Accounts Committee, said that the implementation of PIP had been
“nothing short of a fiasco”.
That reflects the opinion of many of us.
We are not here to give the Minister a hard time, but we are here to highlight the shortcomings in the process. Many of us feel that the process is not built in such a way as to take on board the difficulties that we see our constituents facing. I am here to express those, as other hon. Members have done and others will do. Out of the 220,300 disabled people who applied for PIP during the period from 8 April 2013 to 31 December 2013, only 34,200 have received news of their claim. That is totally unacceptable, and it must be addressed.
One of the statistics associated with first-time PIP claims—those who are moving from DLA to PIP—is truly worrying. For those people, there is around an 85% chance that a final decision has not yet been made, so they are sitting in limbo waiting for everything to be sorted out. Because PIP is not counted as income, those who are eligible for PIP may also find that they are eligible for ESA, income support, jobseeker’s allowance, pension credit or housing benefit. There is a real challenge there, because housing benefit and tax credits are great benefits when they go right, but when they go wrong, they are a nightmare. Delays in PIP may mean that because someone’s income changes—they have to notify Her Majesty’s Revenue and Customs of that—their housing benefit and rent payments are put on hold and their tax credits go up the creek, and they find themselves becoming increasingly anxious and concerned.
In Newtownards, where my main constituency office is based, the food bank would say that the greatest number of referrals are of people who are on benefits, and delays in benefits compound that problem. We are all genuinely grateful to have food banks, and they have become a way of life. I have it on good authority that most of the referrals in my constituency are through my office, and I see lots of people coming into my office who are referred to food banks. We thank the Lord for the food banks and for the good work that they do, but the hon. Lady is absolutely right that food bank use is one consequence of the problems with PIP.
It was estimated that changes to mobility benefits could eventually lead to as many as 428,000 claimants losing their entitlements. Those changes have included the reduction of the requirement for claimants to be able to walk 50 metres right down to 20 metres, as the hon. Member for Plymouth, Moor View has mentioned. Unlike DLA, PIP will not have a lifetime award option. I am aware that under DLA there was the right to review a lifetime decision and that sometimes happened, but many people on lifetime awards were not reviewed, and it is a very random check to do at other times. I am concerned that there will no longer be the option to make a lifetime award. Let us be honest; if somebody has muscular dystrophy, unfortunately, they are not getting better. They are going to get worse. If somebody has severe chronic joint pain, they will not get any better. Their prognosis is for the worse. The prognosis for many such people is restricted mobility for the rest of their lives. That is not what they want, but it is what they are stuck with. Will the Minister, in his response, give us some indication of what he thinks about that?
I want to ask the Minister about a further issue on which I am keen to get some feedback. How many terminally ill people apply for the award—I do not have the figures, but I am asking this question to put it on the record—and how long does it take for their claims to be processed? I am aware of only two people over the years—this was under the DLA system, not PIP—whose applications were not processed quickly enough, so they passed on from this world. I am keen to hear what the Minister has to say about that.
Waiting times are not reserved for England alone—Capita Business Services Ltd is responsible for Northern Ireland, central England and Wales. Charities in Northern Ireland, such as Disability Action, have complained about the longer waiting times for assessment. Charities and my constituents are telling me that there are problems, so clearly we have to address them.
The move to PIP seems to be logical. Physically meeting a person along with a health professional is a great idea, but it is time-consuming and the waiting times make the process long and complicated. All new schemes must be put into action and tweaked to ensure they run efficiently and properly. That must happen with PIP to guarantee a smooth transition from DLA. All of us speaking today think that the delays are unacceptable and that changes must be made to the system. I hope that today’s debate will give us the opportunity to hear a positive statement from the Minister. The Government must ensure that the system is tweaked as soon as possible to bring assessment waiting times down.
I understand the reasons for the move to PIP, but I can also see the problems for the people waiting to be assessed. Elements of the system clearly need to be fixed, such as waiting times and the appeals process, which at the moment is overwhelming. I have constituents who have waited for 10 or 11 months for an appeal. That is unacceptable—it is almost a year between the start and the end of the process—but I am sure that other hon. Members have constituents who have waited longer. To say that problems are inevitable because the system is new only explains some of the issues, and it is no consolation to those who lose out. The Government must address these issues urgently. The waiting times are not fair, and improvements must be made now.
I apologise for not being here at the outset, Mr Crausby. I was keen to be here, but as a member of the Select Committee on Work and Pensions, I also wanted to hear the statement on universal credit to find out whether there was anything new in it.
I find it surprising that, on the one hand, the Secretary of State takes great pride in having a safe and slow roll-out of universal credit—for the past two years, we have been told that it must be safe and slow, and consequently only 17,000 people are on it after all that time; perhaps that is the right way to do things, but it seems astonishingly slow—but on the other, the Department has presided over the roll-out of personal independence payments and, for the past year and a half, has turned the initial applicants into guinea pigs for a system that was not properly piloted or tested.
At the outset, the Select Committee was concerned that the Department’s ambitions and the speed with which it implemented the change were unrealistic. There are unresolved tensions between its desire to give people a longer and more thorough assessment than the much-criticised employment and support allowance assessments and its desire to get through a large number of people. I suspect that some of the problems encountered are due to exactly those tensions.
As a result—perhaps this is hearsay, but the Minister may have something to say about it—the number of face-to-face assessments has already been rolled back. At one point, about 85% to 90% of new applicants were given face-to-face assessments; I understand that it has fallen to 75%. That may be a good or bad thing, but it shows a lack of pre-planning. This really matters to a lot of people. Most new applicants—I will come to the reassessments in a minute—have no money to cover the particular need for which they are applying. Although the payment is backdated for successful applicants, the longer they wait, the harder it is for them.
It is important to realise how important this issue is. Although the Department has overcome its initial problems even with what are regarded as terminally ill cases, a lot of people have serious conditions that do not fit under the special rules provisions but nevertheless leave people in a difficult position. I have a constituent with motor neurone disease who was in exactly that position. Sadly, his condition developed quickly. He went from being a normal, fit, healthy young man in his late 20s to needing help to get places in only a few months.
My hon. Friend speaks with a great deal of experience and knowledge. On her point about the time it takes to get a decision, like her, I have a constituent whose condition deteriorated over a long period. Although our constituents may have just scraped through to one side of the fence when the assessment was made, their conditions were much worse by the time the decision was made, and they should therefore have been assessed differently.
That is a very interesting point. Under the old DLA system, going back two or three years, there was an enablement provision. If a person’s condition got worse, that could be taken into consideration in their application and the appeal process, but now it cannot. Does the hon. Lady feel that the Minister should respond to that point?
That is a very interesting point, and I hope the Minister will give us some details on it.
The other group who seem to suffer less from long delays are those who are undergoing reassessment. If a person asks for a reassessment because their circumstances have deteriorated, previously they would have reported that change to receive DLA, but now they must make an application for personal independence payment. They will receive DLA even if there is a long delay, but if they are entitled to a higher rate of DLA, it will not be backdated under the new system. They do not have no money during that period to help them with the needs that their disability or illness brings, but they do not benefit from the increase. If it takes six, seven or eight months for their DLA reassessment to become PIP and they are eligible for a higher reward, it will not be backdated, even if their condition has clearly deteriorated —and they would not have made the application if it had not.
If the process were working smoothly and quickly, that might not matter. Perhaps at the outset it was thought that there would be no need for backdating because the process would be quick. People would be reassessed and would get the new benefit or not, but at least they would not be waiting for months with a much worse condition. If the claiming process is to be this long permanently—I certainly hope not; the Minister can tell us if it is—perhaps he should look again at that.
I am concerned about another aspect of the way that PIP is processed: there seems to be a substantial variation across regions. I hope that the Minister is at least looking at that issue and monitoring it. I find it hard to understand why, among new claims—but not those relating to special circumstances, i.e. terminal cases—the award rate varies so much; it is as low as 25% in Ealing Southall, but it is 63% in Kilmarnock and Loudon. Perhaps Kilmarnock and Loudon residents are substantially less well, and more disabled, than those of Ealing Southall, but the disparity seems substantial.
The published statistics, the most recent of which bring us to, I think, September, show quite wide variation both in the number and proportion of cases that have reached clearance—meaning a decision, whether positive or adverse, for the claimant—and in award rates. That variation may be explicable, and not a matter for concern, but it would be helpful to know that the Department is monitoring those things and will report on them in due course. The rates will never be identical; areas differ, and there are some where endemic ill health has been a serious problem. That is why the number of people in receipt of employment and support allowance and DLA has been higher in some areas than others; I do not have a particular problem with that.
The question is why an award rate should vary so much and be so low in some places. Presumably people apply only if they have an illness or condition. They will read the forms. Unless it is suggested that in some areas an awful lot of people with no real prospect of success apply, and that that explains the low award rate, the variation seems somewhat baffling. The number of applications varies considerably, as one would expect. One of the examples I gave was Ealing Southall, where the award rate is 25%. There were 660 normal registrations there, not made under special rules. In Kilmarnock and Loudon there were 980 registrations, and in Knowsley there were 1,780 registrations, with a 52% award rate.
Our questions are not only about the length of time being taken, although that is the major issue that most of us have had to deal with. They are also about other aspects of the way the new benefit works: how it compares with the previous situation, which people perhaps do not receive an award, and what the circumstances are. Owing to the length of time being taken, it is still quite early to know how many people are successful on appeal, and to judge the efficacy of the assessment process. From my experience with constituents, it appears that the assessment process, when they get to it, evokes fewer complaints than before, although someone recently came to tell me that their assessment took only 20 minutes, after which they received an adverse decision. That person had been profoundly deaf for some considerable time, so I was slightly baffled.
I hope that in the rush to solve the problem of longer assessment periods and to speed the process up we shall not lose some of the possible advantages of the new system—a more thorough assessment process that would obviously be better for people in the longer term.
It is a pleasure to serve under your chairmanship, Mr Crausby, in this welcome debate. I congratulate my hon. Friend the Member for Bolton South East (Yasmin Qureshi) on securing it, and extend my thanks to all the hon. Members who spoke this afternoon, particularly for the constituency experiences that they highlighted.
It is clear that there continue to be substantial problems with the personal independence payment, yet it is an important benefit for disabled people and for disability equality. It addresses the additional costs that living with a disability entails. We have heard today of continuing delays and problems with access to the benefit, and of poor service, as described by my hon. Friend the Member for Plymouth, Moor View (Alison Seabeck). The cost to the public purse is also rising, so there are several causes for concern, and we look forward to hearing the Minister address those. Interestingly, all those who spoke this afternoon commented on the fact that the benefit was brought in without piloting or experimentation. Early on, MPs and Members of the House of Lords, and organisations such as Citizens Advice, suggested that it would be a good idea to pilot the benefit from the outset. However, Ministers refused to do so.
Of the problems and difficulties that disabled people are experiencing with the benefit, it is the delays in getting an assessment and a decision that are of the most immediate concern. The latest statistics from the Department for Work and Pensions, which go up to September, showed that 529,000 people applied for PIP between April 2013 and July 2014, but just 206,000 had received decisions by that time. That leaves 323,000 waiting in the queue, including 540 in my constituency, many of whom have contacted me to report the distress and problems that that has caused them; other hon. Members taking part in the debate have also had such experiences.
In February, the National Audit Office reported that the DWP had expected decisions to take 74 days, but that the average time for a decision was 107 days. Some delays have been considerably longer, as we have heard. I have constituents who have waited the best part of a year for an assessment for PIP. My hon. Friend the Member for Bolton South East, among other hon. Members, gave several examples of delays that her constituents have experienced. Colleagues also spoke of horrific experiences that resulted from delays. The hon. Member for Strangford (Jim Shannon) was right to highlight how delays compound disabled people’s health problems and anxieties and sometimes contribute to a worsening of the condition. We should be very concerned about that.
I have been told of the deeply distressing case of a 51-year-old woman in south London who applied for PIP in September 2013 and was still awaiting an assessment after a year. She had a brain tumour removed in May 2014, and covering the cost of weekly travel to her hospital appointments meant that she had to cut down on food. She simply could not afford non-essentials such as buying clothes. Other claimants who have waited months for a decision have had to borrow from friends and family, as my hon. Friend the Member for Bolton South East pointed out, or use food banks, as my hon. Friend the Member for Plymouth, Moor View, said.
Generally, we would expect the personal independence payment to be backdated in the event of an award being made, although I was interested in the experience of my hon. Friend the Member for Newport East (Jessica Morden), who suggested that that might not always happen. However, in the meantime, when delays are very long, disabled people are being left without financial support to help cushion some of their additional costs—the cost of equipment, transport to appointments, special diets or additional heating bills. That is happening at a time when many face a reduction in income—and perhaps not just their own, but that of their partner, who may be forced to give up work or reduce their hours to provide care.
What is more, people may also be prevented from accessing other support to which a PIP award may be a passport, such as blue badges and disability premiums on means-tested benefits and working tax credits; carers’ entitlement to carer’s allowance might also be affected. Although the PIP award may eventually be backdated, claims to such passported benefits might not. In other words, claimants might never recover that lost period of entitlement. The Multiple Sclerosis Society reports that some claimants in PIP reassessment areas who were previously in receipt of DLA and who have since reported an increase in needs may lose nearly £3,500 due to delays, as their payments are not backdated. That situation was also highlighted by my hon. Friend the Member for Edinburgh East (Sheila Gilmore).
I acknowledge that both the present Minister and his predecessor, the right hon. Member for Hemel Hempstead (Mike Penning), are concerned about the delays. The previous Minister initiated a number of steps to address delays both in the activities of the assessors and in the Department for Work and Pensions, but it has been interesting to hear today that there are still claims of staff shortages among the health care professionals who are carrying out the assessments, and I hope that the Minister can update us on that situation. In a written answer on 7 July, the previous Minister told me that, as a result of the steps he was taking:
“By the autumn, we expect no one to be waiting for an assessment for longer than 26 weeks and by the end of the year, we expect no one will be waiting longer than 16 weeks.”—[Official Report, 7 July 2014; Vol. 584, c. 109W.]
The present Minister has committed to honouring that promise, although he might like to acknowledge that it represents a rather less ambitious target than the 12 weeks for a decision that we were originally promised.
We remain in the dark about exactly what progress is being made. Macmillan Cancer Support has suggested that it would be helpful if waiting times could be made entirely transparent and publicly advertised. In a written answer on 17 November, however, the Minister told me:
“Departmental statisticians are continuing to develop measures around clearance and waiting times”.
I hope the Minister will be able to update us on performance as regards addressing delays, and will tell us when official statistics will become available.
The right hon. Member for Hemel Hempstead also took steps to address delays in dealing in special-rules cases for terminally ill claimants, which was welcome. From what we have heard this afternoon, I regret that the problems with such cases do not seem to have been wholly resolved. Problems remain, for example, with the rigid application of the six-month prognosis rule, which was highlighted by my hon. Friend the Member for Edinburgh East and the Motor Neurone Disease Association, which has suggested that, although it is possible in some circumstances for the DWP to take account of an overall diagnosis, that is not always happening. I would be grateful if the Minister commented on that.
We have heard about some assessors’ lack of knowledge about, for example, muscular dystrophy. There appears to be a particular and very disturbing anomaly in relation to existing DLA recipients who become terminally ill. If they wish to request an increase in benefits due to their terminal illness, they have to make a claim for PIP. When such claimants make a change of circumstances request, the DWP makes an enhanced award under the care component 28 days after the form is submitted and not, as is the case for DLA claimants and new PIP claimants, from the day of the form’s submission, which means that that very particular group of claimants is being denied 28 days at the enhanced care rate that new claimants who have not previously been in receipt of DLA would receive. The Minister may be aware that I wrote to the Secretary of State for Work and Pensions about that a couple of weeks ago, for it seems to us that the way in which the regulations have been drafted has created an apparently unfair anomaly. Will the Minister undertake to look at that matter? It surely cannot be right that people already in receipt of DLA who become terminally ill should be denied immediate access to a higher award of PIP, if appropriate.
The delays are not only causing great hardship for individuals; they are also piling up costs for the public purse. In 2010, the Government suggested that PIP would have 600,000 fewer claimants than DLA by 2018, leading to a £3 billion cut in departmental expenditure, including a £780 million spending reduction by April 2015, but in February 2014, Amyas Morse, head of the National Audit Office, noting that early operational problems had delayed the programme’s roll-out, said:
“Because it may take some time to resolve the delays, the Department has increased the risk that the programme will not deliver value for money in the longer term.”
Those costs continue to mount. The NAO estimates that £127 million per annum is spent on assessment costs, and in total it will cost £2.9 billion to clear all new claims and migrating cases.
Meanwhile, the Office for Budget Responsibility has noted that the number of claimants who have secured awards is higher than the Department anticipated, and there is uncertainty about whether the pattern will change and the numbers will reduce in future. Additionally, some claimants are receiving compensation for the delays they have experienced, which has further increased costs.
In the original consultation paper in 2010, one of the justifications for throwing all these things up in the air and putting many disabled and ill people through a great deal of anxiety was that too many people were getting the benefit and that PIP would be different. Some 50% of DLA claims were unsuccessful, but in some cases the award rates for PIP appear to be well in excess of 50%. That may be very good for the applicants, but it suggests that the whole thing was premised on a lack of proper research. The change has made many people extremely stressed and anxious over the past few years.
My hon. Friend puts her finger on the issue. We may be seeing some sort of cohort effect, because the cases that went through early may have been more likely to have attracted awards, or higher awards. It may be that initial departmental assumptions were simply wrong or over-optimistic about the savings that could be achieved. It may be that the situation will become even worse, because delays in processing claims and making decisions must be suppressing expenditure on the benefit. If, as the Minister intends, those delays are reduced and, hopefully, eventually eliminated, we will see the costs of the benefit increase. Whether the Government’s ambitions to reduce costs will be achieved is very uncertain. As my hon. Friend rightly says, the real problem for disabled people in that context is the huge uncertainty and anxiety. Disabled people are very uncertain about whether they will be awarded the benefit, which creates great anxiety and alarm.
I have mentioned that there appear to be additional costs for the Department due to the payment of compensation for delays. My constituent, Mr W, received £100 compensation for delays that he had suffered, yet when I asked the Minister how much such compensation payments are costing the Government overall, he told me in a written answer on 23 October that the Department does not record such information. What we do know is that spending on DLA and PIP is set to be £1.4 billion more than projected in this financial year. What is his assessment of the continuing trend in the figures? What impact will that have on the Government’s overall welfare cap? Obviously, any significant increase in expenditure will put that cap at risk.
Given the way in which we have seen costs rise, it is surprising that, in a written answer on 14 July, the Minister’s predecessor told me that the Government remain on course
“to make savings against earlier forecasts of £2.8 billion by 2017-18.”—[Official Report, 14 July 2014; Vol. 584, c. 587W.]
Given all the circumstances that we have heard about in this debate, will the Minister again confirm that expectation and tell us what the Government will do if they do not get spending back on track?
Overall, it is clear that the system is working far from smoothly. The picture for the future remains uncertain, and things remain well off course. In June, the DWP confirmed that it expected 752,000 PIP decisions in this financial year; the latest statistics show that about 37,500 decisions a month were made in the most recent months available, and about 30,000 to 40,000 claims a month were made. At that rate, it seems that the DWP will be unable to clear the backlog of 323,000 cases still awaiting a decision, yet bizarrely, the DWP apparently continues to add more areas where existing DLA claimants are being transferred to PIP, including, in the past couple of weeks, my area of Greater Manchester.
In the circumstances, adding yet more pressure to the system seems inexplicable. Claimants will be deeply worried that the Government are pressing ahead while the programme is manifestly still subject to extreme delay. It does not make sense, it is not fair and it is causing deep uncertainty and hardship to thousands of claimants. I am glad that this debate gives us time for the Minister to respond fully to the concerns that colleagues have raised, and I look forward to hearing what he has to say.
It is a great pleasure to serve under your chairmanship, Mr Crausby. I congratulate the hon. Member for Bolton South East (Yasmin Qureshi) on securing the debate and on allowing other Members to raise their concerns. She started her contribution with some general points. I will touch on them only briefly, as I want to deal with the specific cases that she mentioned and the specific points raised by other Members.
The hon. Lady made a point about judging the Government on their overall approach. I can confirm that we spend £50 billion on disability benefits. The latest unemployment statistics show that our “Disability Confident” campaign has been successful in that more than 250,000 more disabled people are in work, increasing the employment rate for disabled people. Overall, we are supporting disabled people to get back into work and participate successfully in society. However, I will not dwell on that, as I know hon. Members want to focus on the details of personal independence payments.
The hon. Lady mentioned some specific cases, which I will deal with in the order she raised them. She raised the Booth case with my predecessor on 7 July. We had made a backdated decision on that case just before she wrote to us. One point arose out of that case that I wanted to mention, because it was also raised by another hon. Member—I forget whom. The hon. Lady mentioned that the person in the case was out of work. It is worth putting on record that the personal independence payment is designed, as many hon. Members said, to deal with the extra costs of being disabled. It is not an out-of-work benefit. Those who are unable to work owing to their disability or health condition should claim either jobseeker’s allowance or employment and support allowance. Just to be clear, those are income-related benefits; PIP is not. Some hon. Members in previous debates have elided the two, although I am sure she has not done so.
Obviously, the Minister is right about the distinction between the two benefits, but many people do not get out-of-work benefits because they have a working partner or because they have run out of contributory out-of-work benefits. The extra costs of their illness or disability still apply, so the household income decreases considerably over that period. That must be borne in mind.
I accept the hon. Lady’s point. I mentioned it because some hon. Members have raised cases in which there have been two issues: a decrease in income because someone has been out of work, and extra costs. I am simply making the point that, in those cases, it is reasonable to expect PIP to cover the extra costs, but it is not a benefit designed to deal with the fact that someone is not working.
The hon. Member for Bolton South East wrote to us about the Booth case, but I do not think she has written to us on the Pope case at this point, so I do not have the specific details. If she wants me to consider it, I am happy for her to drop me details after the debate. The third case, about which she has written to the Department, is the Syddall case. I put on record my apologies for the delays in that case. When someone has a terminal illness, which was not the case or was not known about in this instance, we obviously prioritise their claim. As the hon. Member for Stretford and Urmston (Kate Green) mentioned, my predecessor put in place those changes to the process, and we are currently dealing with cases involving people with a terminal illness in about the expected time period of 10 days. In cases such as the one raised by the hon. Member for Bolton South East, when the person does not know that they have a terminal illness and dies while awaiting a decision, we deal with the claim based on the evidence we have. Any arrears of benefit, if applicable, are paid to the estate. A decision has now been made in that specific case. It will be communicated to the family shortly, and I will write to her shortly after that to give her the full details. I hope that is helpful.
I thank the Minister for the letter that is on its way to my constituents and me regarding the position on Mr and Mrs Syddall. There is a fast-track procedure for people who are terminally unwell. Is it possible to extend that fast-track procedure for people who may not be terminally unwell, but who are obviously disabled and in need of benefit, such as those who have had a stroke? Perhaps the concept of a special fast-track procedure could be extended to slightly different categories of case.
I will come to that in a minute, because I will discuss the point made by the hon. Member for Edinburgh East (Sheila Gilmore) about paper-based reviews, meaning assessments made based on the paperwork without having to call someone in.
The general point arising out of the specific cases raised by the hon. Member for Bolton South East and other Members is on delays. I have been frank that delays are not acceptable since I made my first appearance at questions; when I gave my evidence at length to the Work and Pensions Committee, on which the hon. Member for Edinburgh East serves; and during the summer when I dealt with Members’ correspondence. The top priority when the Prime Minister asked me to do this job was to get the delays dealt with. That is my priority. I have been spending a considerable amount of time with my officials and meeting with both assessment providers to put it right. A new team of officials have taken over the work and are driving improved performance. We are working with the assessment providers and working with the oldest cases to improve it.
The hon. Lady asked for specifics. Between them, the two assessment providers have doubled the number of health professionals working through recruitment and training, and have increased the number of assessment centres—I will cover specifically the points raised by the hon. Member for Plymouth, Moor View (Alison Seabeck) in a minute—and extended their opening hours.
We have increased the number of paper-based assessments, so in many cases it should be possible, based on the paperwork that people produce, to make a decision without having to call them in for an assessment. The hon. Member for Edinburgh East is right that, at the beginning of the process, the number ran very low and below where we expected it to be. We have improved the process. I hope she will be pleased to know that, when claimants have been unable to work and have gone through the work capability assessment, we are joining up the process, so that we take the ESA85—the report from the work capability assessment—and put it with their PIP form and any other evidence they have provided. That is enabling us to make more decisions based on the paperwork without needing to call people in for assessments. I hope that is sensible.
Those are admirable steps in the right direction, and we appreciate them. Might it also be a good idea to set targets to reduce those figures within a certain period, given all the things that are happening? Sometimes if things are emphasised with targets, they are delivered.
I will come to that in a minute, but let me deal with the point I was going to make on the hon. Gentleman’s constituents and Northern Ireland. These issues are, of course, devolved, so all the points he made about his constituents and the welfare system, although perfectly reasonable, should be addressed not to me but to the Minister responsible in the Northern Ireland Executive. I have no responsibility for such issues in Northern Ireland; they are devolved.
We know where the responsibility lies, but we also know that Capita is the company responsible not only for Northern Ireland but for central England and Wales. I am conscious that the system came in because the Government drove through the new PIP system. That is universal, so there is, in effect, a policy in Northern Ireland. The Minister is not the person responsible—I understand that the Minister in Northern Ireland is responsible—but the debate was secured for the purposes of illustrating where the PIP system is falling down across the whole of the United Kingdom.
I am pleased to deal with the issues in Great Britain, but in Northern Ireland this is not my responsibility; there is a separate contract for Northern Ireland. I am happy to be accountable and to have people beat me up—figuratively speaking only, hopefully—for the things I am responsible for, but I am not responsible for the welfare system in Northern Ireland. That is the responsibility of the Northern Ireland Executive and the Minister for Social Development. The hon. Gentleman’s points are perfectly well made and I will deal with them as best I can—he has raised the same issues as Members from Great Britain. However, for Northern Ireland, I am afraid he needs to direct his points to the Minister and the Executive.
The initiatives I was setting out have meant that providers have quadrupled their output since January. Hon. Members quoted the latest published statistics, which were published in September. They gave the statistics for July, showing that, by then, we had increased the number of decisions to more than 35,000 per month, and there will obviously be a new set of statistics published in December, which will bring the figures up to date to September.
The Department was referred to by a couple of hon. Members. Changes to our processes, our IT systems and the work we do with providers have improved the process.
The hon. Member for Bolton South East referred to claimant communications, emphasising the need to be clearer to claimants. We have improved the communications at the front end of the process so that claimants know what the best evidence to supply is. We have also been clearer with people to let them know how long their claim may take. I know that it is not great when people are told that their claim will take a long time. I will go on to say a bit more about what we are doing about the delays, but at least we are being clearer with people, so that they know what to expect, which is better than their not knowing and having to keep chasing up progress reports.
Since April, we have been confirming to people, by sending a text message, that we have received their PIP form, so they know it has been received and not lost. I cannot remember who asked me about that—I think it was the hon. Member for Plymouth, Moor View. I do not have the data to hand on the number of people who have reported that they have sent a form back that has then been lost, but I will go away and consider it. I do not know whether we have that data, but I will investigate and write to the hon. Lady. In fact, I will write to all hon. Members attending the debate so that they are aware of the data.
That was why we put the text message system in place—so that, when claimants send their form back, they receive a confirmation that we have received it, and therefore do not have to wait and make inquiries later before say, “We’ve never had your form.” They receive that confirmation at the beginning. The assessment providers also provide claimants with improved information about where they are in the process, how long a claim may take and who to contact at each stage of their claim.
Face-to-face consultations are a key part of the assessment process for most individuals, enabling a proper look at their circumstances and giving them an opportunity to put across their views about the impact of their health condition on their everyday lives. Of course, PIP is not based on the diagnosis of a medical condition; it is based on the impact of that medical condition or disability on someone’s daily life. However, if we have enough evidence to make an assessment or recommendation, individuals do not have to come in for a consultation and we will do it on paper. As I alluded to following a previous intervention, we can currently make far more decisions on paper than we could make in the earlier part of the process because we have the information. When we can do so, it clearly makes sense for us not to put somebody through an assessment.
Of course, it is worth saying that part of the purpose of the change from the disability living allowance to PIP, to which the hon. Member for Stretford and Urmston referred, is dealing with the conditions that DLA was not very good at dealing with. The PIP assessment process is better than the DLA assessment process at dealing with people who have mental health problems, cognitive impairments or fluctuating conditions. The fact that the DLA assessment process was not good at recognising those conditions was part of the reason for the change to PIP.
Let me deal other specific issues that came up in the debate. There is one issue that I will touch on only briefly because the Secretary of State dealt with it in the Chamber earlier. I was getting mixed messages from Opposition Members about the best way to roll out PIP. Before the hon. Member for Edinburgh East came into the Chamber, the hon. Member for Bolton South East said that we should roll it out more slowly, be more careful and thoughtful, and that sort of thing. Of course, that is exactly the process we are following on universal credit. I am guessing—probably accurately—that, when the Secretary of State was in the House earlier, the shadow Secretary of State for Work and Pensions, the hon. Member for Leeds West (Rachel Reeves), was beating him up and saying he was not going fast enough. That is what the hon. Member for Edinburgh East said in the debate—she believes we are going too slowly.
The Opposition cannot have it both ways. I accept the point about the problems, but we have adopted the test-and-learn approach to universal credit and been criticised for that, too. That is simply the point I was making.
I merely wanted to point out that, in part, it is a matter of expectations. We were assured throughout the process by the Secretary of State that universal credit would come in without difficulty, and in full, by 2017, and each time he has been called to the Chamber to report on its progress we have heard something to that effect, but obviously reality has not borne him out. On the other hand, we are very early on in the process of PIP. MPs, Lords and outside groups suggested that it would be sensible to pilot the programme first, but Ministers chose not to do so. We are merely saying how important it is that Ministers not only adopt the right process, but communicate what they are going to do and then do it.
I have been clear about communicating what I have been doing to improve the process.
Let me just try to make progress on responding to the issues raised in the debate. I congratulate the hon. Member for Plymouth, Moor View on battling through the effects of her dental treatment. I am not sure how painful it was, but we got her point on terminal illness. Just to be clear, it is not only in cases of terminal illness that we can make decisions on paper. That can be done in any case in which the position is clear. We have a separate process for terminal illness, which is about speeding up the assessment process to 10 days. She also asked about existing DLA claimants. That point has been raised personally with me by my hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard). I am considering those cases and I will report to the House in due course on whether we can make a change. However, she made a good point, and it has made to me previously.
Under-staffing is a problem. As I have highlighted, both providers have made considerable progress in hiring new members of staff.
There is a problem with some work capability assessment centres, but all PIP assessment centres are accessible—no PIP assessment centre is on the first floor. In Plymouth, a new six-room centre was opened in September to boost capacity, building on two centres in the Atos supply chain in Plymouth. We have new centres opening in Chelmsford, Edinburgh and Newcastle. In addition, Atos opened a large 18-room assessment centre in Manchester, and there are further plans for centres in Liverpool, Wakefield, Preston, Blackburn, Wigan, Carlisle and Lancaster. Providers are increasing not only the number of staff they have, but the size of their estate.
On statistics, I am sure that few Opposition Members, with the possible exception of the shadow Minister, the hon. Member for Stretford and Urmston, are assiduous readers of the PIP statistics website on the gov.uk page. If they are assiduous readers, they will know that, last week, we set out that we will publish the PIP clearance times statistics, and waiting or outstanding times statistics, for the first time in March, which is before the election. The release will be pre-announced in line with the UK Statistics Authority release protocols. My statisticians have been working on getting figures that will give a proper and rounded picture, without leading to any perverse incentives. I will not go into that now—I have set out my views on it clearly and at length for the Work and Pensions Committee.
The hon. Members for Stretford and Urmston and for Edinburgh East mentioned success rates, which the Department is looking at. The priority has been ensuring that we not only deal with the delays but keep the quality of the assessments high. The hon. Member for Edinburgh East said that the problem is delays—admittedly, she said she had only anecdotal evidence, but evidence has come from elsewhere. When people have had their assessments, generally the experience has been a positive one. I am not saying that every single case has been positive, but generally speaking the experience has been positive. It is important that we do not lose sight of that.
Finally, in response to a point made by a couple of hon. Members about our forecasts for the cost of the system, they will not be surprised to learn that I will not pre-empt what the Chancellor will set out next week in the autumn statement, when further forecasts will be published—not mine, but those of the Office for Budget Responsibility.
London Transport Zones (Croydon)
It is a pleasure to serve under your chairmanship this afternoon, Mr Crausby. I am delighted to have this opportunity to make the case for moving East Croydon and West Croydon stations from zone 5 to zone 4, or more precisely to zone 4/5, saving local commuters up to £336 on the cost of an annual travelcard into central London.
I hope to make the case for change by establishing, first, that these stations are closer to central London than other stations that are already in zone 4; secondly, that there is ample precedent for stations being re-zoned when a persuasive social and economic case is made; thirdly, that re-zoning these stations will support the local Labour council’s ambitious £9.5 billion growth and regeneration bid that would benefit a large swathe of south London and south-east England; fourthly, that there will be a net financial benefit from making this change; and finally that there will be much-needed savings for people travelling into central London, but no increase in fares for people travelling into Croydon from further south.
Travel distances from central London are standardised by measuring from Charing Cross. On that basis, East Croydon station is 9.3 miles away and West Croydon station is 9 miles away. The two stations, serving areas that include the town centre, are both in zone 5 on Transport for London’s transport travel zone maps, but many London stations that are further away are included in zone 4, including Kenton, which is 9.7 miles from Charing Cross, Malden Manor, which is 10.3 miles out, Hounslow, which is 10.6 miles out, Abbey Wood, which is 10.7 miles away and Chigwell, which is 11.7 miles away from Charing Cross. There is clearly an anomaly when those stations, all further from central London than East Croydon and West Croydon, are all in zone 4, while the Croydon stations are in zone 5. On the TfL map it looks as though the zone boundaries carve out Croydon for no good reason, although it has the effect of costing Croydon’s commuters more in travel fares than other Londoners have to pay to travel greater distances.
There is strong support for making this change from commuters I have spoken to outside both stations. One or two people have asked whether it is actually possible to get stations moved into different travel zones. The good news is that it is not only possible, but it has happened on many occasions—I have mentioned some—and there is no reason why it cannot also happen in Croydon, given the strength of the case.
Can I take my hon. Friend to the northern extremity of his constituency, where it shares a boundary with mine, to Crystal Palace station? Even though that station is in my constituency, a lot of his constituents use it. That station was re-zoned a few years ago—it was zone 4 and now it is zone 3/4—yet Penge East, which is a bit further away but has a much better service into Victoria and is in railway terms much closer, is in zone 4. People who want to get to Victoria quickly have to pay a premium for doing so. There are obviously problems with boundaries anyway, but there are huge anomalies in that part of London, and I wish my hon. Friend well in what he is trying to do.
I am grateful to my hon. Friend for his contribution and I wish him luck in his campaign to secure a better outcome for Penge East and the many commuters living in his constituency who commute into London from that station.
I remember well that Crystal Palace station was moved into zone 3/4 in 2004. Similarly, in 2007, Roding Valley, Chigwell, Grange Hill, Hainault, and Barkingside were all moved into zone 4 from zone 5. Earlier this year Stratford, Stratford High Street and Stratford International stations were all moved from zone 3 to zone 2/3. These are just a few of many examples of London stations being re-zoned.
Re-zoning Stratford was estimated to cost around £7 million, primarily, I understand, in reduced fare income, but it is expected to bring at least £25 million in increased economic benefit to the area every year. Croydon would also, in all likelihood, cost a similar amount but would also generate vastly more in economic benefit than it costs.
Croydon elected a Labour council earlier this year on a promise to be “Ambitious for Croydon”. I am delighted that it has been as good as its word and has unveiled an extraordinarily bold but eminently achievable £9.5 billion regeneration and growth package for the borough that could bring in 16,000 new jobs, 9,500 new homes and around 2,000 new businesses. The effects will generate economic growth not just in Croydon, but across a wide swathe of south London and along a corridor stretching from Croydon to the south coast via Gatwick airport, whose own expansion plans are co-ordinated with Croydon’s. Re-designating Croydon’s two central stations in the heart of this regeneration zone as travel zone 4 would help underline how close the area is to central London, as well as making Croydon more attractive to investors, businesses, home buyers, workers and visitors.
There are some concerns that re-zoning these stations would lead to higher fares for people travelling into central Croydon from other parts of the borough that are currently in the same fare zone. In fact, that would not be the case. There is no extra cost for travelling from zone 5 into zone 4, and the pay-as-you-go single fares and daily caps are the same for travelling across zone 4 and 5 as travelling within either of the two zones. Commuters travelling from East Croydon or West Croydon stations into central London would realise considerable savings. An annual travelcard holder would save up to £336 a year if this change were made. At a time when many people have found their wages held down or cut in real terms, this saving in travel costs would be particularly welcome.
I pay tribute to people who have offered support to the Zone 4 Croydon campaign, first and foremost the hundreds of Croydon commuters who were quick to sign a petition in support of making this change that I will, in due course, seek to raise on their behalf with the Mayor of London. He is ultimately responsible for taking the decision, subject to approval by the Department for Transport. I should mention Sarah Jones, a local mum and campaigner, who has recently been selected as Labour’s parliamentary candidate in Croydon Central, who launched the campaign with me. I am grateful to the Croydon Guardian and the Croydon Advertiser for their support, and to the leader of Croydon council, who has personally backed the campaign and intends to seek the formal endorsement of the council within weeks. There is real, strong support in Croydon for making this change. I trust that we will hear today that the Government will also offer their unequivocal support.
As my hon. Friend the Member for Lewisham West and Penge suggested, south London is poorly served by the current zoning arrangements, relative to other parts of the capital. This is not a problem that affects only East Croydon and West Croydon stations. Although I strongly sympathise with the other cases, I would not want any decision about East Croydon and West Croydon to be delayed while other worthy cases are also considered. Local commuters would not thank anyone who tried to put hurdles of this kind in the way of making this change. Re-zoning is not something that has to be implemented across a number of stations at the same time. It has always happened incrementally.
I believe the strength of the social and economic case, and simple fairness, demand that East Croydon and West Croydon stations must be moved into zone 4 as soon as possible. I look forward to hearing the Government’s view and hope very much that it is supportive and positive.
It is a joy to serve under your chairmanship, Mr Crausby. I congratulate the hon. Member for Croydon North (Mr Reed) on securing this important debate on London transport zones and Croydon. I recognise that the zoning of stations has a real impact on the cost of travel in London, and I am aware that this is a matter of some concern locally. We do, as a Government, understand how important rail travel is for this country’s economy and for all of us who use these services to get to work, to visit family and to get around. That is why this Government are investing £38 billion over the next five years to improve the national network, generating faster, more comfortable and more punctual journeys. I understand how important it is to keep travel costs for hard-working people down. That is why last year we curbed the rail industry’s powers to increase fares. It is also why we will hold down rail fares next year to retail prices index inflation for the second year in a row.
We recognise the importance of investing in transport in London. That is why we have provided Transport for London with more than £10 billion during this Parliament, which has enabled upgrades to the tube network that have already increased capacity on the Jubilee line by 33%. We will also see a 20% increase capacity on the Northern line from next month. The investment will also bring the first air-conditioned walkthrough trains to serve customers on the Metropolitan, Circle, District and Hammersmith and City lines. We have also transformed major London stations including King’s Cross, St Pancras, Stratford, Blackfriars and Paddington. The Crossrail project is on track to deliver a brand new railway across London by 2018, transforming journeys across the capital.
We are improving rail travel in Croydon. The Government’s investment in London transport has enabled the Thameslink programme of upgrades, transforming the line, which serves East Croydon station. Capacity will dramatically increase by 2018. A fleet of 115 spacious new trains will run every two to three minutes through central London at peak times.
The hon. Gentleman need not worry. As he has left me plenty of time to speak, I thought I would put the debate in the context of the unprecedented investment that the Government are putting into rail, not only in London, but across the country.
Croydon receives an excellent and frequent train service. Someone would be hard-pressed to find an area in zone 5 with better services to central London than Croydon. The hon. Gentleman mentioned that Croydon is closer to central London than other stations in zone 4. Ultimately, there will be winners and losers in any simple zoning system, as stations near the boundary of a zone will be closer or further from London stations than others. Distance is only one factor in determining the zone in which a station falls.
The hon. Gentleman’s arguments for re-zoning Croydon stations are interesting, and it is important to have these debates, but there is an established process for re-zoning stations, which works as follows. The travelcard map, which shows the zone in which each station falls, is set out as part of the travelcard agreement made between the train operating companies and TfL. The Government are not a signatory. Any changes to station zones must be proposed by a signatory to the agreement; the Government are not able to do that. The proposal must then be agreed by the remaining signatories. The Department for Transport can approve or reject the change proposals. The decision is made by the Secretary of State for Transport on the basis of the business case. If the proposal does not represent good value for money, it is unlikely to get approval. The Government cannot and should not promote or back any proposal outside that established process.
I thank the Minister for his explanation. On the basis of what he has just heard and the link to the dramatic and bold £9.5 billion regeneration bid being proposed for Croydon through a regeneration and growth bid—we hope the Chancellor of the Exchequer will endorse it in the autumn statement—does he personally think that the proposal should be supported?
As I made clear, it is a matter for TfL and the train companies. In passing, I point out that eight stations in East Croydon’s zone are closer to central London. Indeed, one is only nine miles away, while East Croydon is 10.25 miles, or 10 miles and 34 chains, I think, from Victoria. There is no official rule about where distances are measured from. By convention, some measure London distances from Charing Cross, but we are not aware of any reason why that should be the overriding rule. Generally the distance from the terminus station would seem to be the most sensible choice. That is Victoria in this case, although London Bridge is slightly nearer.
If one of the train operating companies running stations in Croydon wishes to formally propose the change, a number of factors would need to be considered. First, changing the zone of a station does not come free. A season ticket for zones 1 to 5 costs £2,136. The season ticket for zones 1 to 4 costs £1,800, so the difference between them is the figure of £336 that the hon. Gentleman drew attention to. Reducing the cost of travelling from a station reduces the revenue brought in by that station, and that can add up to millions of pounds a year. Ultimately, those costs would be covered by the taxpayer. A loss at Croydon might need to be compensated by raising fares elsewhere. At a time of intense financial pressure, is it fair to ask taxpayers as a group to pay for travellers in Croydon to have cheaper fares? It might be.
I am grateful to the Minister for his frequent kindness in letting me intervene. In looking at the cost of making the change, does he take into account the net economic benefit, as was the case with Stratford? The Greater London authority estimated that, although that change cost £7 million, the net economic benefit was £24 million, which is multiples more than the cost of making the change.
I understand the sensible point that the hon. Gentleman is making, which contributes to the debate. It is possible that the economic benefits to the area would outweigh the costs, but the question cannot be answered without some serious consideration. How would re-zoning impact businesses in the area? How would it impact residents? How would it impact surrounding stations and the areas that they serve? For example, passengers who live slightly closer to a station that was in the next zone might decide to change their journey plans and travel to East Croydon to save on their season ticket. The change could put increasing pressure on the station, which is already very busy.
The train operating companies would need to investigate all those issues. The argument for re-zoning would need to be demonstrated in a robust business case. The effects of re-zoning a station are not only financial; there would also be changes to demand at the stations. If it is cheaper to travel from one station in an area than another, people will choose the cheapest journey. That is the logical response, but a change will also make stations more crowded. East Croydon is already one of the busiest stations in the UK outside central London, and re-zoning it would make that worse.
A constituent raised the issue that my hon. Friend the Member for Croydon North (Mr Reed) kindly allowed me to mention earlier. The Minister said that passengers will choose the cheapest option, but that is not true in every case. It is also about the service. In the case that I highlighted, Crystal Palace is eight stations from Victoria, but Penge East is a mere five stations away. It is a much faster service from Penge East, although it is more expensive. People choose to go from Penge East; they do not necessarily go for the cheapest option.
The hon. Gentleman is right. The current zoning seems to as much be down to historical reasoning as anything else, but it is the basis on which the franchises have been let and the basis on which the train operating companies have calculated their revenue. In cases of re-zoning, compensation might need to be paid to those train operating companies to allow for the difference in income.
Is increased congestion at their station a trade-off that commuters are willing to make? Is it a trade-off that provides value for money? Finally, what consideration has been given to commuters who travel into Croydon for work? As the hon. Member for Croydon North has said, Croydon’s economy is flourishing and there are many jobs in the local area. If Croydon is re-zoned, travel costs for people living in London’s outer zones could increase significantly.
Yes, if the stations moved into zone 4/5, but if they just moved into zone 4, there would be an increase in cost, which would be a consideration for fare revenue. The re-zoning could have an impact on train operating companies. All those things need to be carefully considered.
As we have heard several times during the debate, Croydon is not the only place where calls for re-zoning are being made. A formal proposal has been submitted requesting that the Stratford stations should be re-zoned, and my Department has received correspondence asking for stations to be moved into the London zonal fares area. Other hon. Members have made similarly passionate arguments in favour of re-zoning stations such as Kingston, Surbiton and Epsom. I am sure that there are many others for which local arguments could be made.
Clearly, a wholesale transfer of stations into lower zones would not be affordable. It is, of course, important that the station zoning is reviewed and that re-zoning can take place when there is a strong case. The established process for re-zoning a station ensures that value for money and the impacts on other transport users are considered. That is what will need to happen with the proposals to re-zone Croydon.
In summary, I hope that I have been able to clarify the process for considering proposals to re-zone London stations. As discussed, it would not be appropriate for the Government to comment at this stage on the merits or otherwise of re-zoning Croydon. We will reflect carefully on the points made in today’s debate but can make no promises. The proposal will need to go through the proper channels and the proper process, and there will need to be agreement between the train operating companies and Transport for London. We would want to satisfy ourselves that any re-zoning proposal for stations in Croydon represents value for money. The Government are committed to ensuring that value for money is maintained to allow us to keep transport costs affordable for the travelling public—a key part of our wider commitment to improving the transport network both in London and across the country.
Furniture and Furnishings (Fire Safety)
It is a pleasure to serve under your chairmanship, Mr Crausby. The Furniture and Furnishings (Fire) (Safety) Regulations 1988 set out the levels of fire resistance for domestic upholstered furniture, furnishings and other products containing upholstery. Between 7 August and 7 October the Government ran a consultation on proposed changes and, subject to its results, the Department for Business, Innovation and Skills proposed implementing the changes in April 2015.
I have called for this debate because employers in Pendle have expressed to me their deep concerns about the proposed changes. Pendle’s local economy relies heavily on manufacturing, and a sizeable proportion of people work in the furniture sector. Silentnight in Barnoldswick employs around 800 people, sofa manufacturer Buoyant Upholstery in Nelson 800, and Furnico in Pendle around 400. Many other companies are also involved in the sector. Clarkson Textiles, based in Nelson, represents about 25% of the fire-retardant or FR coating market in the UK.
Silentnight was one of the companies that helped with the creation of the existing regulations, implemented 26 years ago. When people such as Iftikhar Mirza, Silentnight’s quality assurance and laboratory manager, who was involved in the original process, express concerns, we know that those concerns are not simply a knee-jerk reaction but are based on decades of research and experience.
All those companies are proud of how our fire regulations save lives and help to prevent fires. As the BBC 1 “Fake Britain” investigation into sofas and mattresses back in January showed, if the regulations are not adhered to, the consequences can be deadly. Silentnight even took the opportunity to mention the importance of the regulations to the Prime Minister when I took him to visit the company back in May. I, too, have expressed concerns about enforcement over the years with Ministers, Lancashire trading standards and the Lancashire fire and rescue service.
The Government’s consultation on the proposed changes to the regulations sets out some laudable aims, namely to improve safety, to make UK furniture greener and to bring savings to the industry. I will take each aim in turn to explain why I and the businesses that I represent feel that the proposals fail in each and every regard.
On improving safety, the existing test method is a simple pass-or-fail test, and one that I have observed being carried out by local businesses. Fabric arrives at a coating company such as Clarkson Textiles and is treated and certified, or it arrives already treated at a furniture manufacturer and is tested before it is used. The new test introduces a two-tier system, with the additional clause relating to the size of the hole formed during testing.
Offering a choice of tests does not lend itself well to the supply chain in the industry and will make the job of trading standards officers almost impossible. How can trading standards police and prosecute with so many variables in the new test method, such as filling 1, filling 2 or the size of the hole produced on burning? The existing method offers a simple, worst-case test because the foam underneath the material being tested is also flammable. Replacement of that with fire-retardant foam reduces the severity of the test. Inclusion of the polyester fibre in filling 2 goes some way to increasing severity, but it is still not as robust a test, and it therefore runs the risk of leading to less safe furniture.
Proponents of the changes will, I am sure, say that the new regulations, by insisting that all internal components are fire retardant if the size of the hole produced by a flame is over a certain level, will mean that overall the item of furniture will be safer. With respect, however, that is simply not true. The existing regulations provide for a flame-retardant barrier over the furniture against small ignition sources, such as a cigarette or a faulty electrical item. By the time a fire has been able to burn through 40 mm of fabric and foam and got all the way to the internal components of a sofa, we have lost the battle anyway.
It is also worth remembering that when fabric is sent for treatment, it is likely that it will be treated for stock, so it would not be known what kind of furniture that fabric would be used on, or even who would purchase it. Fabrics are not precision-engineered products; variables in yarn type, dye stuff, fabric weight and add-on treatments must all be accounted for. Testing over non-FR foam, as the current test does, gives extra tolerance to allow for such variables.
There is also concern about the removal of the cigarette test on fabrics that have passed the match test. As the European Flame Retardants Association pointed out, it was great to see in the 2012-13 fire statistics report a clear downward trend in fire fatalities, but the report also stated that smokers’ materials have caused the largest share of deaths in house fires. With that in mind, is it not a gamble to change the status quo at the very time when the UK can congratulate itself on its fire safety achievements and can continue leading and being an example to other European Union countries?
Concerns have been raised about enforcement of the current regulations—concerns that I have been raising for some time, and which were covered in the BBC “Fake Britain” programme. Introducing new variables, however, and a situation in which sofas would have to be purchased and pulled to pieces to test internal components are unlikely to improve enforcement by trading standards departments, which already have limited resources.
My hon. Friend is making an important case, and one that I am sure Formulated Polymer Products in Ramsbottom, which makes such chemicals, would support. Does he agree that what we need is better and more rigorous enforcement of the existing regulations by trading standards?
I thank my hon. Friend for making that important point. The existing regulations are incredibly effective and have saved many lives; they could save more lives if they were enforced effectively. We should be enforcing the regulations, rather than playing about with them and trying to come up with a new test that I do not think is as robust as the old one.
The second aim of the changes is to make UK furniture greener. Again, that is a laudable aim, and it is based on reducing brominated FR usage by around 50%. Those to whom I have spoken, however, feel that the total level of brominated chemical use quoted by BIS is greatly inflated by the method of calculation. No figures from the chemical or coating industry have been quoted, but it estimates that a total of 12 million to 16 million metres are coated in the UK, not the 65 million metres quoted by BIS. The BIS figure includes leather, loose covers and inherent fabric, which are not treated, so at best the documents exaggerate the level of chemical use in the industry.
Furthermore, with the new test, the application level of chemical per metre will remain the same on many fabrics, as shown by recently published research from FIRA, the Furniture Industry Research Association. In some instances, the application level could increase, and the requirement to make every internal component of the sofa fire retardant if a hole appears during the test means that the likelihood is that far more brominated chemicals will need to be used. A small reduction can be achieved on some simple, lightweight synthetic compositions, as shown by the test results offered by BIS, but, to take us back to the safety point, no fabrics tested included common add-on treatments such as fluorocarbons.
Clarkson Textiles also feels that the changes would hamper innovation and development as it and other companies explore ways to reduce the use of brominated fire retardant. The new test removes the scope for final composite testing. With careful selections of fabric and interlinings, it is already possible to produce a flame-resistant item without FR chemicals, but without final composite testing it would be illegal, because the cover may not pass over foam and fibre as specified in the new test.
We also need to consider the impact of the new regulations on the re-upholstery industry, which is easily overlooked because most of the companies involved are small. They might not even be aware of the changes proposed by the Government. At the moment the re-upholstery industry facilitates furniture recycling and reuse, helps reduce landfill and therefore helps the environment. As drafted, the proposed new regulations could destroy the sector, because many fabrics that produce a hole when tested could never be used again. The choice would be either to throw the furniture out, which is not good for the environment, or for companies to increase significantly the back coating of the fabrics with far more chemicals, which again is not good for the environment.
The third aim of the changes is to bring savings to the industry—again, a laudable one. The estimated savings projected by BIS, which were calculated on the reduction in chemical application and the removal of the cigarette test, look impressive. However, the unanimous message from the businesses I have spoken to is that the cost savings on fire regulations testing are minimal and are therefore totally outweighed by the introduction of the testing of internal components.
In its consultation response, Buoyant Upholstery clearly sets out why it does not believe the changes will save the industry money. Simply applying 50% less FR coating, even if safe, would, it estimates, save it only something like 10p per metre, whereas ensuring that every internal component is FR treated would impose massive costs on a company that currently has 120 different models in its range and uses over 1,170 different fabrics. Not only would its products need to be redeveloped, but all its floor models in furniture retailers across the country would need replacing. To put that in perspective for a company like Buoyant, the three largest retailers it supplies have 1,186 floor models between them, which have often been supplied at discounted rates. The cost for UK furniture manufactures of replacing all those floor models will be significant. Companies such as Buoyant will be hit with costs for product redevelopment and alternative components, increased supply-chain auditing and due diligence costs, increased material costs and so on.
Clarkson Textiles tells me that chemicals represent only around 33% of the coating price—£1.20—meaning that savings to customers would be only between 8p and 20p per metre. If Clarkson Textiles represents 25% of the coating market in the UK, and its total consumption of FR compound is only £1.5 million, it will be impossible to make the savings to industry of £17 million to £50 million that have been quoted by BIS during the consultation.
I turn now to what trade organisations say about the changes. In responding to the consultation, industry representative bodies have been clear: neither the Furniture Industry Research Association nor British Furniture Manufacturers think the proposals will achieve the aims set out by the Department. They see no evidence that the changes will make the industry greener, save money or, crucially, make furniture more fire safe, and do not think that the changes are viable. The National Bed Federation agrees, saying it cannot be sure that the proposals will save money or improve safety, although it recognises that making UK furniture greener is possible and that reducing FRs is becoming ever more important.
Those groups are not resisting the changes for the sake of resisting change. As FIRA makes clear in its consultation response, the industry itself has been calling for a revision of the regulations for many years. As far back as January 2010, meetings were taking place at BIS and a plan was agreed for fully revised regulations to be introduced by 2012. The industry sees change as overdue, but it sees these particular changes as inadequate and incomplete, given the many other amendments that are required and will need to be addressed in future.
I called for this debate after receiving a reply from the Minister, dated 11 November, responding to concerns raised by Joel Rosenblatt, chairman of Buoyant Upholstery. That reply said that the Department was analysing responses to the consultation, but very much implied that the changes were pretty much a done deal. However, as recently as last Thursday, BIS officials were e-mailing invites to meetings, at short notice, to select parts of the industry only, along with technical documents showing that the proposals have changed again and the reasons for the changes have altered. It would appear that as of last week the changes are no longer about saving fire retardants, but are now about safety; apparently the current regulations do not work. However, no evidence has been presented for that idea in terms of fires or deaths, and there is no evidence for what the savings will be.
The altered proposals seem to ignore the report by the Minister’s own Department into the effectiveness of the regulations, which was commissioned from Greenstreet Berman in 2009. That report suggested that between 2002 and 2007 the regulations saved 54 lives, and led to 780 fewer non-fatal casualties and 1,065 fewer fires each year, with savings to the taxpayer valued at about £140 million per year.
I am very supportive of the Government’s drive to reduce unnecessary red tape and get our economy back on track. The effects can be seen in my constituency, and Pendle businesses in this sector, such as those I have mentioned, are employing hundreds more people than they were in 2010. However, we need to work with the industry and listen carefully to what businesses are saying. There is general amazement that the biggest review of the regulations since 1988 was conducted essentially by just two people. The review could and should have involved the material manufacturers, furniture manufactures and leading test houses right from the start. The UK’s two largest independent test houses, SATRA and FIRA, were not even properly consulted at the start of the process, and FIRA has only recently been able to present its own findings to its members. Most in the industry feel the whole process should be started again, involving the right people from the start, so that more effective proposals can be driven by industry rather than, as some feel, being imposed from above.
It should not surprise the Minister that the upholstery industry is unhappy with the situation. Most businesses are unaware of the further technical changes that are now being discussed, before the results of the public consultation have even been published. As I said, no one is anti-change, but there is deep concern about the way the Department has gone about this process. Despite all the flaws, the opposition of industry and the clear evidence that the changes fail to achieve any of the intended objectives, the Department still seems keen to press ahead in order to have something implemented by April next year. The current regulations have been in force for 26 years. They are simple, effective and have saved lives. Let us not put that in jeopardy.
It is a great pleasure to serve under your chairmanship, Mr Crausby, in this important debate. I thank my hon. Friend the Member for Pendle (Andrew Stephenson) for raising this issue in the House. The debate is particularly timely because, as he noted, the Department has recently held a consultation on the issue; at the moment, we are considering the consultation responses and thinking about our next steps. I will simply caution in advance that although I will try to respond to some of the issues he has raised today I will not be able to set out a definitive view on exactly what those next steps will be, as that matter is still very much under consideration. However, as I say, that makes today a good time to have this debate, because all the points and arguments he has raised can be considered as part of that process.
I recognise that there are a number of manufacturers in my hon. Friend’s constituency who are clearly knowledgeable about and deeply invested in this matter, not just financially but in terms of the wider safety issues. It is useful that he can bring his expertise to this debate, having spoken to them as their constituency Member. As he set out, in the proposals that we have consulted on we are aiming to achieve better safety and environmental benefits; if there is a benefit to business in the form of savings, that is also helpful. I think we all share those objectives, and I understand the concerns he set out with regard to them. The end result that not just he and I but probably the entire industry want to achieve is a robust, safe system that is not overly burdensome, but in which everyone can none the less have confidence, and excess chemicals do not need to be used. The challenge for all of us is to work out the best path to that; that was the purpose of our consultation on the issue.
In general terms, we have an excellent record on fire safety in the UK, and as the Minister with responsibility for consumer affairs, I am keen to ensure that our enforcement regime and fire safety rules remain fit for purpose. Earlier this year, my hon. Friend got in touch with the Department about imported furniture products that do not properly comply with fire safety regulations, and the concern that some of that furniture might not always have the anti-flammability properties and protections needed for UK safety standards. Not only does that lead to significant safety concerns, but such importers are able to undercut UK businesses that have very high standards and are scrupulous about adhering to our important safety rules.
The matters we are discussing are important and serious. As I explained in my responses to my hon. Friend’s earlier inquiries to the Department, we have been through many of the issues carefully with trading standards, which is responsible for enforcing the rules on safety. It is true that non-compliant imports do find their way into the UK in a range of ways. Trading standards is obviously involved clearly and closely in stamping down on that, and it has expressed concern about various issues with enforcement and fabric treatment, including some in the UK, in terms of treatment companies processing fabrics not to an acceptable standard. Many reputable companies do a brilliant job, but there are concerns about some where that is not the case.
To help to improve enforcement practice, we are funding a £25,000 project led by Rhondda Cynon Taf trading standards, which is working with five other trading standards departments around the UK to look at compliance of upholstered furniture with the fire safety regulations. They will gather important evidence about enforcement and deliver a series of recommendations to help us to target that enforcement effectively throughout the furniture supply chain.
A second relevant issue, which has been discussed in the other place, is the Consumer Rights Bill. My colleague Baroness Neville-Rolfe announced that there will be an independent review of product recalls across a range of product safety legislation to consider what information systems exist to inform consumers about product recalls and how well they work in practice. That gives a flavour of how we are looking to improve the enforcement regime, which is a key part of ensuring that the regulations work. However, that depends on the basic safety rules in place, which brings me to the review of fire safety regulations covering furniture and furnishing.
The regulations have generally been a big success, as my hon. Friend the Member for Pendle said. They have ensured that as the furniture market has grown to provide more choice and variety at a range of prices that ordinary people can afford, furniture has stayed safe. He mentioned the statistical report that was commissioned in 2009, which showed excellent safety benefits from the regulations; they have saved around 54 lives a year and prevented nearly 800 casualties and over 1000 fires. UK domestic furniture is probably the safest from fire in the world, which is a record we all wish to maintain.
The regulations are 26 years old, and we recognise that technology and manufacturing processes change and move on, so four years ago, shortly after the election, the Department for Business, Innovation and Skills started a project to look at the rules in depth to ensure that they are still fit for purpose in the context of technological and manufacturing change. It became clear that, as well as modernising the rules, there were several other big issues to address. One was concern about the high use of certain types of chemicals used as flame retardants to meet our stringent flammability tests. They include the most common brominated flame retardant used in furniture, deca-BDE, which has been banned in the USA and is restricted under REACH, the EU regulation on registration, evaluation, authorisation and restriction of chemicals.
Concerns were identified about how the current test is working, and about the fact that it might not always do what it sets out to do: to prove that the cover fabric being tested will form a barrier to protect the foam or filling underneath. The consultation we launched in the summer had two main aims. We wanted to see if we could find a way to reduce the reliance on dangerous flame retardants, and to find a new test that would not have the problems that we had identified with the current test, particularly because it fails to take account of how fabrics actually perform in furniture in the finished product. If savings can be generated for business, all well and good, although I am sure that hon. Members always want safety to be uppermost in our minds when discussing such issues.
I am heartened by much of what the Minister is saying. She cited what has been done in the USA in banning the use of certain chemicals. There have been reports, and evidence has been produced in the USA, particularly in California, showing a significant increase in the number of domestic fires. I hope that as the Department for Business, Innovation and Skills moves forward with the proposals, it will look at examples in other countries where banning some chemicals has, unfortunately, undermined consumer safety and led to more fires.
Clearly, that outcome is the opposite of what we want to achieve. We are analysing carefully the consultation responses, and are happy and keen to look at evidence from around the world, where changes have been made to rules on chemicals, on the impact on consumer safety. If my hon. Friend has specific information, I would be happy to receive it from him.
When we undertook the consultation, we looked at the match test, which is a key test to assess the ignitability of cover fabrics. I want to make three points about the proposal, but we are still considering the responses. We proposed to make the test set-up much more like the way furniture in the home is constructed. Currently, the cover fabric is laid directly next to a highly flammable foam filling—a kind of foam that is now illegal for use in furniture, to which my hon. Friend alluded—and that is believed to be a worst-case scenario. Most modern furniture has a lining material between the cover and the filling, so the test conditions are different from the finished product. My hon. Friend suggested that the current test is a worst-case scenario, and that if something passes it, it will be fine, but in practice, when fabrics are placed over linings, they may not always be fitted tightly, so air may be present between the fabric and the lining, which means that it may be more ignitable. There is a danger that something could pass the existing test, but when the fabric is in situ in a piece of furniture it may not comply with what was being tested. We must understand that, and the proposal was to have a test that represents much more how a piece of furniture would be used in the home.
The proposed test includes other materials that are now commonly used in furniture below the surface, such as webbing and fibreboard. They are not tested independently at the moment because it is assumed that if the cover passes the match test, it will stop a flame getting into the furniture and setting something on fire. However, our research work to investigate the existing test method suggests that that is not always the case in practice, which is why we want to correct that by introducing a test for other materials. It is important to note that that is intended as a one-off, so the material will be tested, and when it has passed, it will be published in a list of extra materials that can be classified as exempt, whereas the cover fabrics would still have to be tested regularly. We are trying to make the test more realistic and comprehensive.
The third point is to try to make the enforcement challenge for trading standards easier. The problem with the current set-up is that it does not allow for all the variations that can occur in testing because of the interactions between covers that are treated with flame retardants and the foams used in the tests, and the chemical differences that arise because the foam interacts directly with flame retardants on the cover fabrics. Those variations may mean that while doing enforcement activity, trading standards can find covers that have been passed when they should have failed. My hon. Friend pointed out that the variations in fabrics is an issue that make this a challenge. Trading standards has said that the proposed test will be easier to enforce because the pass or fail will be clearer, with a smaller grey area.
As my hon. Friend is aware, the consultation closed just over a month ago. We received a substantial number of responses, and we are continuing to digest everything that has been put to us. I think we all agree that furniture safety is essential. It is great that we have a good record in the UK, and we want it to continue. I understand his concerns and those that various parts of the industry have raised through their Members of Parliament or in the consultation. I am considering them very carefully because we want to get this right. Not every ministerial decision comes with the responsibility that people’s lives are at stake, but this is one about which I feel keenly. It is complex and there is a significant need to weigh up the different factors to ensure that we get the right course of action.
I have set out what we want to do on the enforcement side, but the fire safety rules are vital to ensure that the enforcement operation can work. My basic aim is to ensure that any changes that we ultimately make improve the safety regime and deal with some of the difficulties that have been identified with the current tests. That is an area of genuine concern. We must ensure that we understand the concerns that have been raised, and that we move ahead with new regulations that everyone can have confidence in and that will provide the safety that everyone wants.
We will listen to the views of my hon. Friend and those who responded to the consultation, and work closely with fire services, trading standards, test houses and the industry to ensure that that happens. I am grateful to my hon. Friend for raising all these concerns. I am sure he will follow the next steps with great interest.
Question put and agreed to.