House of Commons
Tuesday 10 March 2015
The House met at half-past Eleven o’clock
[Mr Speaker in the Chair]
Oral Answers to Questions
The Chancellor of the Exchequer was asked—
1. What recent estimate Her Majesty’s Revenue and Customs has made of the amount of uncollected tax in the UK. 
4. What recent estimate Her Majesty’s Revenue and Customs has made of the amount of uncollected tax in the UK. 
HMRC published its latest tax gap estimates on 16 October 2014. In 2012-13, the tax gap was estimated at £34 billion, 6.8% of total tax due.
I thank the Minister for those figures. Will he confirm that HMRC’s own figures show that under this Government the amount of uncollected tax has risen by £3 billion?
The number I quoted a moment ago, 6.8%, is a lower percentage of tax due than was achieved in any year under the previous Government.
There has been speculation that the Chancellor’s Budget next week will deal with tax avoidance and evasion, but there has also been speculation that by 2016 the number of staff working in HMRC will drop from 50,000 to just over 40,000. How do the Government expect to deal with evasion and avoidance if they are unwilling to properly resource HMRC?
Over the course of this Parliament, HMRC has brought in more yield year after year. If the measure is just on the number of staff, the hon. Lady will be aware that, when HMRC was formed in 2005, it had something like 92,000 members of staff and that by the end of the previous Parliament it had below 70,000. It is not about the number of staff. We are seeing a huge improvement in HMRC’s performance.
Will the Minister confirm that HMRC’s compliance yield target has actually been revised up this year to £26 billion, which is £9 billion more than when this Government came to office?
My hon. Friend is absolutely right. The important point here is the output, not the input. I should point out that the number of staff employed in enforcement and compliance has gone up over the course of this Parliament.
17. A young man in my constituency had his jobseeker’s allowance taken away because he missed an early morning appointment, despite having notified the jobcentre of the illness that prevented him from attending. He is just one of many vulnerable people affected by the sanctioning regime imposed by this Government. According to the House of Commons Library, the amount lost in tax evasion and tax avoidance exceeds the entire spend on JSA by £2 billion. Does the contrast between the persecution of the most vulnerable and the Government’s failure on tax avoidance not say everything about their priorities? 
Over the course of this Parliament, the number of prosecutions for tax evasion has gone up fivefold. The reality is that the Government are taking more measures to deal with tax avoidance and tax evasion. We have done that consistently at every Budget. Ever since the 2010 spending review, there has been a greater focus on HMRC being able to bring in the yield. The numbers, as my hon. Friend the Member for North West Leicestershire (Andrew Bridgen) pointed out, speak for themselves.
Hundreds of millions of pounds are lost in revenue, criminal gangs are financed and untold damage is done to the environment in Northern Ireland as a result of fuel laundering. Why have the Government resisted putting effective trace measures into fuel, which would stamp this out? Is the Minister concerned that despite numerous raids nobody is ever caught for fuel laundering in Northern Ireland?
Our record across the piece shows that we take tax evasion and criminal activity in this area very seriously. This is a complex matter, but the hon. Gentleman will know that considerable efforts have been undertaken to address fuel laundering. This is a matter we take very seriously.
The Minister must acknowledge the significant damage that the recent HSBC tax avoidance and evasion scandal has done to the public’s confidence in the Government’s willingness to pursue tax avoiders and evaders, thereby reducing the amount of uncollected tax in the UK. In the Chancellor’s absence, will the Minister now answer the question that the Chancellor failed to answer six times on the “Today” programme? Did the Chancellor ever discuss tax evasion at HSBC with Lord Green—yes or no?
As I have pointed out, the Government’s efforts and success in dealing with tax avoidance and tax evasion are a huge step forward from what we inherited. On the appointment of Lord Green, the proper processes, as put in place by the previous Government, were undertaken. The Cabinet Secretary looked at Lord Green’s tax affairs, and just as the previous Government appointed him to their business advisory council, so he was appointed as a Minister—an appointment that was welcomed by the Labour party.
Still we have no answer to the simplest and clearest of questions. If we cannot get a straight answer from the Chancellor or his Ministers, we should at least hear from Lord Green—the man who was in charge of the bank and was then made a Conservative Minister—either in front of a parliamentary Committee or through a statement in the other place. Why are the Government parties so desperate to silence Lord Green? What are they so afraid he will reveal?
We are not afraid of anything. The Government have been more successful at prosecuting criminals involved in tax evasions, more successful at closing tax avoidance loopholes and more successful at getting money in. That is a record we can be proud of.
2. What proportion of recipients of tax credits are in employment. 
In total, 4.5 million households are in receipt of tax credits, and 71% of them are in employment. The Government believe it is right to provide additional support to those in need through the benefits system, but we have been clear throughout that we want to ensure that people are better off in work than on benefits.
Will the Minister confirm that the Government’s real-terms cuts to tax credits will not only hit more people in work but hit far more women than men?
I am sure the hon. Lady shares my delight at the great news that the gender pay gap is lower than it has ever been, that there are more women in work than ever before and that 1.85 million people are in work who were not in work at the time of the last general election. That is cause for celebration. The Government have strived at every point to support women into work, whether through entrepreneurial allowances, support for women with child care or other measures.
19. Is my hon. Friend aware of the Institute for Fiscal Studies report on living standards showing that living standards are back to where they were before Labour’s great recession? Does this not help the very people she has mentioned? 
Yes, my hon. Friend is exactly right. The IFS report also showed that 200,000 fewer people were in relative poverty in 2014-15 compared with 2009-10, including 100,000 children, and that since 2010 the number of children under 16 in workless households had fallen by about 390,000, taking it to the lowest level since records began. That is very good news.
25. The average wage in my constituency is £450, which is £71 per week less than the national average. How can the Minister defend real-terms cuts to tax credits for these hard-working people, particularly the women, in my constituency? 
The hon. Gentleman will surely be delighted at the news from the IFS and other forecasters that real wages are now rising at a higher rate than inflation, and it is thanks to our long-term economic plan that inflation is so low. We have had council tax cuts and fuel duty freezes, and we have done everything we can by raising personal tax-free allowances to enable people to benefit from a recovering economy, but we can only do it by sticking to a long-term economic plan.
Am I right in thinking that universal credit will replace working tax credits and child tax credits, making 3 million households better off by an average of £177 per month and improving work incentives by allowing people to keep more of their income as they move into work?
Yes, my right hon. Friend is exactly right. Universal credit is a major reform that will transform the welfare state in Britain for the better. It will replace the current complex system of means-tested working-age benefits, including tax credits, and make 3 million households better off by on average £177 a month.
3. What steps he is taking to invest in infrastructure. 
This Government have revolutionised the approach to infrastructure through long-term planning via the national infrastructure plan, which we conceived and published, that sets out an infrastructure pipeline worth more than £460 billion of public and private investment. In the 2013 spending round, I committed over £100 billion to support infrastructure investment across the United Kingdom.
I am delighted that the Government have made significant commitments to the south-west region, such as the fantastic £50 million-worth of investment for a new junction on the M49 in my constituency. Will the Minister confirm what further investments he is making for improvements to transport across the south-west region as a whole?
Investment in the transport infrastructure of the south-west has been a much higher priority for this Government than, I think, for any previous Government. We have committed £7.2 billion-worth of investment in the transport infrastructure of the south-west, including £2 billion in roads—for example, dualling the A303 and the new tunnel at Stonehenge, sorting out the A30 all the way to Camborne and the electrification of the Great Western main line with new inter-city express trains. I have recently asked the south-west peninsula rail task force to bring forward more proposals for investment in strategic rail schemes for the region.
Last month, a couple of hundred senior business figures gave a very warm welcome to the second stage of the review that Sir John Armitt has done on infrastructure for the Labour party, including plans for a new independent national infrastructure commission to identify the country’s long-term needs and monitor Governments’ plans to meet them. Business backs Labour plans; business organisations back Labour’s plans; will the right hon. Gentleman back them?
Of course, the Labour party’s belated conversion to long-term planning for infrastructure is welcome, although it was not the practice during its 13 years in office. I think that the national infrastructure plan and the architecture around it provides the right framework for delivering that long-term planning. I am not convinced that a new quango is the best way to solve the problem.
Last week, the HS2 Select Committee wrote to the Treasury asking for more flexibility on big infrastructure projects where farmers have difficulty finding suitable replacement land within the statutory time limits for capital gains tax relief, leaving the businesses not knowing whether or not a discretionary power could be granted. Can the Chief Secretary give some comfort to my constituents who are affected by this?
I do take seriously my right hon. Friend’s point. The Department for Transport is working on the plans to flesh out how these things will work in respect of HS2. I would add that HMRC can provide extra flexibility where there are particular impacts on particular farmers or other businesses. I would certainly want to maintain an open mind on the points that my right hon. Friend is raising.
I could not help but notice that when my hon. Friend the Member for Birmingham, Ladywood (Shabana Mahmood) was asking the Chief Secretary’s sidekick to answer a question about Lord Green, the Chief Secretary was constantly having a laugh at his expense. I am going to give him a chance: will he now answer the question about meeting Lord Green. Now is the opportunity to make a name for himself. Come on.
The hon. Gentleman has made his point, but unfortunately it does not relate to investment in infrastructure.
How do you know?
I am trying to use such powers of anticipation as I have, but let us hear the Chief Secretary respond.
I do not recall ever having had any conversations about investment in infrastructure with Lord Green. Matters relating to ministerial appointments are, of course, a matter for the Prime Minister. What matters is making sure that in this country we have a zero-tolerance approach to tax evasion and tax avoidance, and that where organisations are facilitating or encouraging tax evasion, we put in place the proper penalties.
Does the Chief Secretary agree that no British Government should fail to invest in the infrastructure, the personnel and the equipment of the armed forces at a rate less than the NATO-recommended minimum? Will he have a word with his leader and with mine to make sure that the necessary commitment is given before the general election?
We have met that commitment in the present Parliament, and we will do so in 2015-16 as well. Spending on defence will, of course. be a matter for the next spending round. However, I suggest that the hon. Gentleman should have regard not just to the total amount spent, but to the efficiency of the expenditure. We have made great progress during this Parliament in securing better value, in terms of defence equipment and output, for the limited money that we have to spend as a country.
The Treasury has had meetings with the European Commission to discuss the reinstatement of the aggregate credit levy scheme for Northern Ireland, which could serve as a further tool of investment in infrastructure. What further discussions have taken place?
I know that discussions have been ongoing, and that the issue has been the subject of a protracted dispute. I have no further updates, but I will ensure that my ministerial colleague who is responsible for the scheme writes to the hon. Lady.
NHS Funding Pressures
5. What recent representations he has received on fiscal steps to address funding pressures in the NHS. 
The Government have protected the health budget in real terms throughout the current Parliament. Of course a strong national health service needs a strong economy, and the Government plan to deliver that strong economy, along with a fairer society. The NHS budget has already increased by £12.7 billion during this Parliament, and in the autumn statement we announced an additional £2 billion for front-line NHS services. That money is intended to meet demand pressures in the next financial year, and also to help to start the process of transformation that was outlined in the “Five Year Forward View”, which is probably the most important representation that I have received on NHS funding in the last year or so.
Hospitals have struggled to cope with the pressures during the winter. Labour has made a fully funded commitment to provide the extra doctors, nurses, home care workers and midwives who are needed through a “time to care” fund. Analysis of Conservative party spending plans shows that more than 260,000 elderly people risk losing their social care packages during the next Parliament. Is it not time for the Government to commit themselves to taxing hedge funds and tobacco companies in order to raise the extra resources that our NHS so desperately needs?
Let me gently say to the hon. Gentleman that he ought to be a wee bit cautious about believing too many of his Front Benchers’ spending plans. They say that they want to deal with the deficit but have set out no plans to do so, and they have made multiple spending commitments without any sense of how those commitments will accord with their fiscal strategy.
The hon. Gentleman is, of course, right to suggest that going too far and reducing the deficit reduction by more than is necessary in the next Parliament would have a damaging effect on public services. I would say that his party has got it wrong and the Conservative party has got it wrong, but the Liberal Democrats have got it right.
23. Despite the economic chaos that was inherited by the coalition Government, spending on the NHS in England has been protected and increased. Does that not compare very favourably with the position in Wales, where a Labour Government have slashed NHS spending by 8%? Should we not judge these people by their deeds rather than their words? 
My hon. Friend has made a very fair point. Comparing the NHS performance of different Administrations is an important activity, in which I am sure he will engage very fruitfully over the next few weeks. Let me add that if we are to judge a Labour Government by their actions, we should look at the mess that the Labour party made of the economy when it was last in power. If we found ourselves with problems of that kind again, money for our NHS would be one of the resources that would suffer.
As we heard from my hon. Friend the Member for Denton and Reddish (Andrew Gwynne), the pressures on the NHS are already putting care services in crisis. Why has the Chief Secretary colluded in Tory plans to shrink public investment and take an additional £70 billion from public services in the next Parliament, thus posing an even bigger risk to health and social care? He has dodged the question in the past; will he give us a straight answer now? Why did he sign off those Tory plans in the autumn statement?
The hon. Gentleman would do better to begin any question about the NHS with an acknowledgement of his own party’s failures I have made it clear that the figures published by the Office for Budget Responsibility represent a neutral assumption. I think the hon. Gentleman’s party would borrow too much and the Conservatives would cut too much, and that what we need is a balanced approach in the middle.
I do not know whether the Chief Secretary knows what he is doing. The letter from the OBR’s Robert Chote explicitly says—I have it in front of me—that the forecast for that £23 billion of surplus in 2019-20 was
“signed off by the ‘quad’”,
of which I think the Chief Secretary is a member. Is Robert Chote wrong, or did the Chief Secretary not realise what he was signing up to? Will he at least assure us that, if that was a mistake or he did not spot it in the past, he will be opposing a repeat of those Tory plans in next week’s Budget Red Book?
Matters relating to the Budget will be revealed by the Chancellor in his Budget statement next Wednesday and not before, as I am sure you would expect, Mr Speaker. I have listened to the hon. Gentleman today, as I listened to him on the “Today” programme yesterday, and there was not a single answer about how Labour would balance the books, and not a single answer about how Labour would invest in public services. I heard yesterday about Labour’s zero-based review, which seems to mean zero savings, zero ideas, zero economic credibility.
Health services in Chester and west Cheshire are facing increased pressures because of thousands of people fleeing from the Welsh NHS and seeking treatment in England. Will my right hon. Friend guarantee to provide more money for hospitals on the English side of the border, to protect them from the failure of the Labour party in Wales?
Clearly, there are issues in the NHS in Wales, but I would caution my hon. Friend about the tone of his question, because health workers in England and in Wales are working as hard as they can to provide the best treatment they can for people on either side of the border. Of course there are failures in terms of funding in Wales and issues that need to be dealt with, but everyone on this side of the House should unite in respect and admiration for our nurses and doctors and the work they do to keep us healthy in this country.
6. If he will make a comparative assessment of the level of duty on wine paid in the UK and in other EU member states. 
Industry estimates show that there are 135 wineries in England and Wales, producing 4.5 million bottles of wine. The UK’s growing and award-winning wine industry benefited from the Government ending the wine duty escalator at Budget 2014.
There will be much responsible dancing in the streets if the Chancellor completes a hat-trick of beer duty cuts in his Budget and there will be much responsible celebration if he cuts the duty on spirits. But there will be much wailing and irrepressible disappointment if he does not reduce the duty on wine, which has gone up by 54% since 2008 alone and accounts for 67% of all the duty on all wine in the whole of the EU. Will he complete a fantastic treble-whammy by dropping the duty on wine, too, which it has been estimated would generate some £3 billion in extra revenue—and 20,000 jobs!
If it is not already too late to make this suggestion, I think my hon. Friend deserves a good bottle at lunchtime after that effort. He has put his case on the record, but of course all announcements are for the Chancellor on Budget day.
If this Government do indeed have a long-term economic plan, which most of my constituents do not believe, will the Financial Secretary stop worrying about the older generation of wine drinkers and start concentrating his mind on the young people of this country who are underprivileged and overtaxed and have more problems in getting a good job? It is about time that the 18 to 35-year-olds, rather than the older wine drinkers of this country, were taken into account by this Chancellor.
First, may I reassure the hon. Gentleman that there is a long-term economic plan, and thank him for using the phrase? Credible public finances will benefit the younger generation, who will not face many years of paying off higher debt levels.
While the Financial Secretary is looking carefully at the duty on English wine, will he redouble his efforts to support artisan and small-scale cider makers, who risk being put out of business as a consequence of a disastrous recent EU decision?
I appreciate the point made by my hon. Friend. The Government’s support for small cider makers across the piece has helped to create a diverse and vibrant market in this area, and we will continue to study the Commission’s arguments carefully because we want to support this industry.
Tax Avoidance and Tax Evasion Schemes
8. What plans he has to introduce penalties for financial advisers who promote aggressive tax avoidance and tax evasion schemes. 
This Government have been relentless in cracking down on tax avoidance and evasion. We have introduced a tougher monitoring regime and penalties for high-risk promoters of tax avoidance schemes, and the unprecedented common reporting standard will mean that by 2018 more than 90 countries will be exchanging information on offshore accounts automatically, helping Her Majesty’s Revenue and Customs to find and pursue offshore evaders successfully.
I thank the Chief Secretary for that answer. Does he agree that more has been done on tax avoidance in the past five years than was done in the previous 13, so craven were the previous Government before big business and big tax avoidance? Will he welcome the Financial Secretary’s announcement yesterday of further action on tax avoidance-promoting schemes?
The hon. Gentleman is absolutely right in both things that he says. The Financial Secretary’s announcement represented very important further progress, but if we look back over the past five years, we see that the relentlessness of our pursuit of measures to crack down on avoidance, be it the general anti-abuse rule in the tax system, the disclosure of tax avoidance schemes regime, the monitoring regime that we are putting in place or the measures to increase prosecutions for tax evasion, has made it clear that there is absolutely no tolerance for aggressive tax avoidance and tax evasion in this country.
The Chief Secretary will know that 10% of UK wealth is held in offshore bank accounts, which is a much higher proportion than in the United States, so why is he not focusing on that tax avoidance and evasion, at a time when 65% of people on jobseeker’s allowance in Swansea have been sanctioned and are living on a pittance? It is a disgrace.
The hon. Gentleman clearly was not listening to my first answer, because we have put in place something unprecedented: working with our colleagues in other countries, the common reporting standard will mean that more than 90 countries will be automatically exchanging information on offshore accounts, so that HMRC has the information it needs to find and pursue offshore tax evaders successfully. We need to make further progress on how we deal with organisations that encourage, promote or facilitate tax evasion. I have said I want to see further work done on that, and I am sure we will be hearing more about it soon.
In 2006-07, a hedge fund manager avoided millions in tax through a film scheme later judged unlawful. HSBC received £438,000 for acting as an intermediary, so does the Chief Secretary agree that there should have been a penalty on HSBC for its role in this scam?
I do not know the details of the specific instance to which my hon. Friend refers, but I do think that in cases where an organisation is facilitating or promoting tax evasion and a penalty is then paid and tax is paid, as it should have been in the first place, the organisation facilitating the tax evasion should be liable for exactly the same amount of money, to be paid to the Exchequer. In that way, there would be a strong financial as well as legal incentive for people not to get involved in this practice in the first place.
Local Authority Borrowing (Home Building)
9. What recent representations he has received on caps on local authority borrowing for building homes. 
I have received many representations on local authority borrowing caps, but I would refer the House to the recent excellent review of the local authority role in housing supply carried out by Natalie Elphicke and Councillor Keith House. They made many suggestions as to how the local authority role in house building could be improved, but one of their conclusions was that the problem was not a lack of money but the way in which resources are deployed and organised in the local government sector.
I very much welcome the answer to my question and the other comprehensive measures the Government have taken to enable people to buy their own homes, such as First Buy. Will the Chief Secretary explain a little more about some of those findings and what more we can do to ensure that hard-working people who need social housing can get it?
The hon. Lady raises an important question. In this Parliament we are building more affordable homes than has been the case at any point in the past 20 years, and in the next Parliament we will be building even more. However, I do not think any of us should be complacent; we need to raise substantially the level of house building in this country. That is why I welcome the recommendation of Keith House and Natalie Elphicke on a housing finance institute. It is also why I set out around the autumn statement last year moves towards Government taking a direct commissioning role to ensure that we meet a 300,000 homes a year target. That will be piloted at the Northstowe development, which I encourage the hon. Lady to find out more about.
I declare an indirect interest, which is on record. Local authorities are at the sharp end of this Government’s failure to deliver the housing that the country needs, particularly affordable rented housing. Labour Plymouth is proactively doing what the Minister has just said—bringing forward land and building 1,000 homes. It has a view on the cap and about meeting the need. Greater concerns, however, surround the announcement of the starter home scheme, which will lead to a massive loss of affordable home building— developers get out of any requirement to do it and the local authority has no say. Can the Chief Secretary please tell the House what the impact assessment of that policy was and the impact on affordable rented homes?
The idea behind the starter homes scheme is precisely to offer homes at a discount to young people who want to get on the housing ladder. I would have thought that was an objective that everyone in the House would welcome. If the hon. Lady wants to look at social rented housing, in this Parliament—and continuing in the next Parliament—we have the highest annual rate of social house building than under the previous Government or for the past 20 years. During Labour’s 13 years in office, the number of social homes fell by 421,000; we have increased it by over 300,000.
10. What recent discussions he has had with the Finance Secretary of the Scottish Government on devolution of taxes. 
I have had frequent and largely constructive discussions with the Scottish Cabinet Secretary for Finance, Employment and Sustainable Growth, including on the matter of devolution of taxes, as have my ministerial colleagues. The Scottish Minister recently met the Chancellor of the Exchequer. We have made huge progress in the area of tax devolution.
From reading the text of the Smith agreement, it seems to me that we have handed over income tax in particular to the Scottish Government, whereby allowances and bands can be varied. In fact, we have created the possibility of an independent tax system, apart from hanging on to the 20p tax as a kind of fulcrum around which it must work. Has the Treasury looked at the impact on the UK if there were an entirely independent tax system in the north of the United Kingdom?
Yes, we have. The hon. Gentleman is right. The Smith commission—rightly, I believe—devolves power over rates and bands in the income tax system. It does not devolve control of the tax base or the personal allowance. One of the bits of work that remains to be done is to ensure that we have a fiscal framework in place around that which means that the fact of devolution does not offer a financial advantage in and of itself either to Scotland or to the rest of the United Kingdom. I have had constructive discussions with John Swinney on that point and on many others. It is, of course, a matter for the Scottish Government to make sure that they have competent administrative machinery in place, which they will need next month when the process of the first wave of income tax devolution starts.
Is my right hon. Friend, like me, waiting with bated breath for the latest Government Expenditure and Revenue Scotland figures to be published? Does he expect that they will bolster or demolish the Scottish National party’s case for full fiscal autonomy?
Bated breath might be overstating it, but I expect the new GERS figures very soon. In recent days we have seen evidence of the damage that the Scottish National party’s ideas would do to the UK economy—higher debt for the whole of the UK at the end of this Parliament than at the beginning of it, and an extra £5 billion a year being spent on interest payments. Having been defeated on its proposals for independence, which would have undermined and damaged the Scottish economy, the SNP seems inclined to offer the same damage to the UK economy as a whole.
Under the Scotland Act 2012, from April 2016 Scotland will indeed have significant new tax-raising powers. HMRC’s own risk register shows that the risk that Scottish taxpayers will not be identified by April 2016 has risen from amber to red, so can the Chief Secretary tell the House why, despite these being the biggest changes to Scottish tax ever, only 11 full-time equivalent HMRC staff are working on them and, according to Audit Scotland, they rely on a single official in the Scottish Government?
I am confident that the resource being applied at the HMRC end of the spectrum is sufficient to ensure that we can deliver the devolution that is planned. That process is going on at present. Stamp duty devolution starts in April this year and income tax devolution the following April. Whether or not the Scottish Government are applying sufficient resource, effort or people to make sure that the tax system will be competently administered is a question for them to answer. I recently signed off the orders to devolve stamp duty, and they will now need to make sure that that is done properly.
I thank the Chief Secretary for that response, although it does not entirely fill me with reassurance. Is it not the case that this whole process risks descending into absolute chaos, and is it not time that both the UK and the Scottish Governments got a grip? How many HMRC and Treasury officials have been seconded to the Scottish Government to help clear up the mess? If people have not been seconded, will he now have urgent discussions to see whether that would help?
I am afraid that it is a feature of devolution, which the hon. Lady and I both support, that devolved Administrations have to take responsibility for matters that are in their purview. Frankly speaking, it is not for the Treasury to send officials to bail out Revenue Scotland. If it approaches us and says that it does not have enough people, it cannot do it and it is not ready, that is fine. But having discussed the matter with John Swinney and received assurances that he believes that it is in a good position to carry on taking on those functions and to do so properly, that is sufficient for me to sign the orders to hand over the powers.
Fiscal Support for Businesses
11. What fiscal steps he has taken to support businesses. 
The Government champion business. We have cut the main rate of corporation tax to 21%, the lowest in the G7, we have allocated more than £460 billion for infrastructure projects, and we have committed to unlock up to £10 billion of business finance through the British Business Bank by 2017-18.
Businesses in Chiswick, Brentford, Isleworth, Osterley and Hounslow have been hugely helped by the Government through lower business rates, reduced tax, better infrastructure and two new free schools, which were announced yesterday, to help build the skills for the future. Does my hon. Friend agree that only a Conservative Government with a long-term economic plan can help make Britain the most attractive place in the world to start and grow a business?
I completely agree with my hon. Friend. She is right that we want Britain to be the best place to start and grow a business. I am delighted for her that she has 9,600 new start-ups in her constituency, which she has fought for diligently throughout this Parliament, and that, as a result of this success, unemployment is down 38% in her constituency since 2010. I was particularly delighted to pay a visit with her to one of them, My Plumber Ltd, and to meet the wonderful Ollie, who was the apprentice there in charge.
One fiscal measure that affects business a great deal is the rate of VAT, and every Conservative Government put up VAT. In 1979, they put it up from 8% to 15%; in 1991, up to 17.5%; in 1994, on fuel and power; and in 2010, VAT was raised again to 20%. So we know what they will do, but let us give them one more chance. Will the hon. Lady rule out putting up VAT if in power after May?
It is extraordinary. I wonder if the hon. Gentleman would like to admit that every Labour Government when they leave office leave unemployment higher than when they came in. That is the truth of the matter. The Government are sorting out the mess left by the Labour Government, which was the worst financial crisis in British peacetime.
18. Does my hon. Friend agree that, thanks to our long-term economic plan, the Government have supported businesses through cutting businesses taxes? Does she further agree that the real difference between the Government and the Labour party’s approach is that while we have been cutting taxes on businesses, it wants to put them up? 
Yes, my hon. Friend is exactly right. There is the risk under Labour of a return to an anti-business system that has already been recognised by people who are themselves trying to run businesses in the UK that are contributing to our economy. She has been assiduous in her constituency in supporting business. She has more than 8,000 new start-ups, and I was delighted to visit Clare and to meet the Ealing Mums in Business, who are doing everything that they can to build successful businesses from small beginnings, to talk to them about access to finance.
One of the steps designed to assist businesses in Northern Ireland is the devolution of corporation tax. In light of the reneging of Sinn Fein on the introduction of welfare reform, what implications does the Minister see in the devolution of corporation tax in Northern Ireland?
As I think the hon. Gentleman will know, we will agree to devolution for Northern Ireland if it is sustainable, and if it is felt by all sides to be a sustainable proposition.
12. What assessment he has made of recent trends in the level of youth employment. 
This Government have taken decisive action to boost youth employment. We have been a Government who are very much on the side of young people, and the results are clear: youth employment is increasing, up by 110,000 over the past year, and the number of young people claiming jobseeker’s allowance is at its lowest level since the 1970s.
Youth unemployment in my constituency is down by 53% since 2010. In the city of Hull, it is down by 54%. Does my hon. Friend recognise the opportunity that has been created by the growth in apprenticeships under this Government? Does she agree with the Education Committee that it would be “a mistake” for level 2 apprenticeships to be abolished for young people, as the Labour party proposes? Does she agree, on this occasion, with the TUC, which says it would be “a grave injustice”, or with the Association of Employment and Learning Providers, which says that, on apprenticeships, Labour has “got it all wrong”?
My hon. Friend is right. Under this Government we have seen over 2 million new apprenticeships, and level 2 apprenticeships are absolutely vital in giving young people a chance. Young people have shared in the success of our long-term economic plan, with the UK now having the fourth highest youth employment rate in the EU and the second highest in the G7. Very importantly, young people’s wages are also on the rise, with the latest data showing that the earnings of 18 to 21-year-olds who work full time have increased by 6% over the past three years.
Yesterday I had an exchange with the Minister for Employment in which I made it abundantly clear that youth unemployment in my constituency continues to rise. She has said that the recent rise in youth unemployment is just “a tiny blip”. Does this Minister agree with that?
The hon. Gentleman should surely be delighted that since 2010 youth unemployment in his constituency is down by 47%, so I cannot agree with him, and that since 2010 unemployment is down by 34%. In the past 12 months, long-term unemployment is down by 38%. Surely he should be celebrating those numbers.
Marriage Tax Allowances
13. What his policy is on the future of tax allowances related to marriage. 
The Government have introduced the marriage allowance for married couples and civil partners, which takes effect from 6 April 2015. The transferable amount has been fixed at 10% and will rise in proportion to the personal allowance.
More than 4 million people could benefit from the marriage allowance, for which they have been able to register since 20 February. Does my hon. Friend agree that this is about much more than just pounds or pence—it is about valuing commitment and marriage as a bedrock of society?
As the Prime Minister made very clear in the 2010 general election, it is right that we recognise marriage in the tax system, and that is precisely what we have done. As my hon. Friend rightly points out, it is now possible for people to register to be able to benefit from the transferable tax allowance.
Does the Minister consider it either fair or socially useful that money is being spent in this way when only one in four of the couples who benefit are raising children?
This is about recognising marriage within the tax system, but it should also be noted that it will benefit many low-income households, including 1 million households where tax credits are claimed.
North Sea Oil and Gas
14. What steps he is taking to support jobs in the north-east of Scotland by maximising the economic recovery of North sea oil and gas. [R] 
The Government have made significant progress on supporting the North sea oil and gas sector, including the announcements I made in December about an investment allowance and other changes, although I recognise that there are very serious ongoing problems at the moment.
I thank the Chief Secretary to the Treasury for recognising the problems in the North sea. Does he also recognise that the job losses that have been announced predate the fall in the oil price, and that it is crucial that in the Budget we see long-term structural change for the maturity of the province?
I wholeheartedly agree with my hon. Friend. I have had a number of meetings with Oil & Gas UK and representatives of the oil industry. Having set out in December the fact that the tax regime for the North sea is going to be on a declining path, recognising precisely the issues that he mentions, we have set a clear direction of travel, and the Chancellor will set out our decisions in the Budget next Wednesday. Let me reassure my hon. Friend that this Government take incredibly seriously the need to make sure that we have a fiscal regime that supports maximum economic recovery of the resources of North sea oil and gas.
The Chief Secretary knows that the fundamental issue is the cost of doing business in the North sea basin. The up to 81% marginal tax rate on production is something that the Government could do something about. Given that this Chief Secretary boasted that putting up the supplementary charge was his decision, will he now apologise for that and make sure that the charge begins to be reduced in the Budget next week?
In fact, we made sure that the supplementary charge began to be reduced in the autumn statement in December, so the hon. Gentleman should catch up on his facts. The fact remains that the measures we are taking to support the industry—through the Wood review, the establishment of the Oil and Gas Authority, and decommissioning deeds and field allowances —have already created an environment that has seen very substantial investment in the North sea in the past few years. The point that my hon. Friend the Member for West Aberdeenshire and Kincardine (Sir Robert Smith) made is right. Making sure that we have a climate for long-term investment is precisely what we are trying to do, and the hon. Gentleman will have to wait for the Budget for our decisions.
What are the Government doing to encourage the offshore sector to co-operate and to have common standards as a better way of reducing costs in the supply chain than laying off the very people we will need when, I hope, things in the North sea begin to pick up again?
The hon. Lady makes an important point about co-operation in the industry. It is precisely such co-operation that has led the Wood review to recommend and the Government to create the Oil and Gas Authority. We find that particularly in respect of the sensible and low-cost use of infrastructure in the North sea, where greater co-operation between fields and so on will help to reduce costs. That is one of the early challenges that Andy Samuel is getting to grips with at the Oil and Gas Authority, and I think he has the support of the whole House in doing so.
T1. If he will make a statement on his departmental responsibilities. 
Mr Speaker, I should say that the Chancellor of the Exchequer is at ECOFIN, making sure that Britain’s voice is heard in the European Union, and the Exchequer Secretary is unwell. I am sure that the whole House wishes her a speedy recovery.
The core purpose of the Treasury is to ensure the stability and prosperity of the economy.
Will the Chief Secretary confirm that the Treasury has had discussions with the Department for Business, Innovation and Skills and the Department of Energy and Climate Change with regard to UK Coal’s application for state aid for the British coal industry? What stage are the discussions actually at?
It would be wrong for me to go into the ongoing discussions between BIS and other Departments and the industry. However, I can certainly say that I am aware of the issues that the industry is experiencing, and a discussion on that subject is going on with the Government.
T2. Under the previous Labour Government, thousands of pubs closed and the brewing industry was taxed to the point of extinction. The Campaign for Real Ale now says that the Chancellor has saved 1,050 pubs, sold 75 million extra pints and has been the saviour of Britain’s brewing industry. Does the Chief Secretary agree that this Government have been positive for beer and pubs, and will he urge the Chancellor to keep on supporting our breweries? 
This Government have undoubtedly been positive for beer and pubs. Many hon. Members, including my hon. Friend the Member for Leeds North West (Greg Mulholland), have campaigned on this issue. It is of course for the Chancellor to announce the Government’s decisions in this respect—I am sure that he has not pulled all those pints himself—but it is certainly the case that the beer and pub industry is stronger in this country, as part of a stronger economy, because of the decisions that this coalition Government have so far made.
T3. Do the Government expect operating oil companies in receipt of tax concessions to develop contract strategies to enable UK fabricating yards to participate in large contracts with the potential to support thousands of jobs across the whole country? 
If the hon. Lady has specific issues in mind, I would gladly engage in further discussion with her, but the steps this Government have taken—including the establishment of enterprise zones in many areas where there are fabrication yards, and measures such as electricity market reform to get offshore wind and other such production going in the UK—all support the objective that she describes and which I share. If she has further ideas on how we can pursue that, I would gladly hear them.
T4. The Chancellor recently highlighted the major part that my Cleethorpes constituency and the Humber estuary will play in the growing northern economy. However, much depends on continued investment in transport infrastructure. Will the Minister assure me and my constituents that that will continue as a high priority? 
I certainly can. In the final Treasury questions of this Parliament it is worth reflecting on the fact that, despite the tough economic decisions we have had to make, this country is making the largest investment in our rail network since Victorian times and the largest investment in our road network since the 1970s, and we have a programme to roll out superfast broadband across the entire country. Those things will leave our economy with a stronger long-term growth potential, as well as having given us the best growth rates in the European Union at the moment.
T5. Is it not the case that those earning more than £1 million a year have benefited from an average tax cut of up to £100,000 a year in this Parliament? Does that not illustrate that, as ever under the Tories, the mega-rich get richer and the poor get poorer—and that this time they have been aided and abetted by the Liberal Democrats? 
It is this Government who have dealt with disguised remuneration by which loans were never repaid, benefiting the highest earners. It is this Government who have increased the rates of stamp duty land tax on high-end properties and ensured that they are properly enforced. It is under this Government that capital gains tax has gone up so that cleaners do not pay a higher rate of tax than hedge fund managers. It is this Government who have ensured that those with the broadest shoulders bear the greatest burden, as the Institute for Fiscal Studies confirmed last week.
T6. Is my hon. Friend the Economic Secretary aware that in my rural constituency, businesses regard the words “long-term economic plan” with the same degree of comfort and familiarity as evensong in an Anglican church? Will she be good enough to give an assurance that, following the election, those words and the benefits that they bring will continue, not least through the expansion of broadband which is so important for rural business? 
It sounds as though evensong in my right hon. Friend’s constituency is a fabulous occurrence, and hopefully not just on a Sunday. He is right to point out that this Government have sought to ensure that the benefits of the economic plan are felt right across the country and that the growth is balanced, with all three major sectors—services, construction and manufacturing —growing by 2.5% or more for the first time since records began in 1990.
We all want to see an end to big companies wriggling out of tax by offshoring profits, but what assessment has the Minister made of the impact on kitchen table digital industries, such as the sale of knitting patterns, of the way in which HMRC has implemented the new EU rules on VAT being collected in the country of sale, and what can he do about it?
Those are EU rules. It was the previous Government who signed up to the principle of changing the way in which the VAT system worked, and they were right to do so. This Government have taken two measures to try to mitigate the impact on some smaller businesses. None the less, without the support of other member states, we are still faced with a change in the rules.
T7. Under this Government, food and drink manufacturing is a great British success story. However, our dairy farmers are being badly affected by volatile global markets. Will the Financial Secretary look favourably on proposals to implement tax averaging reforms, such as those in Ireland, to help these essential producers who contribute so much to our rural economies? 
I am grateful to my hon. Friend for her question; I shall take it as a Budget representation. I am sure she will understand that I cannot say any more about it at this point, other than to thank her. She has been vigorous in putting forward that case.
For hard-pressed taxpayers, the real test of whether the Government are committed to cracking down on tax evasion and avoidance will be whether this month’s Finance Bill contains legal penalties for breach of the general anti-abuse rule. Will the Financial Secretary tell us whether those will feature in the Finance Bill—yes or no?
The hon. Gentleman will have to wait for the Finance Bill to be published and to hear the Budget statement next week. He should reflect on his party’s record in office on these matters. Frankly, when the coalition Government came to office, we inherited a tax system like a Swiss cheese: it was so full of holes that tax was leaking all over the place. We have plugged a lot of those holes and there is more work to be done, but I do not think that he should give us any lectures.
I am sure my right hon. Friend will welcome the report by the Electrification Task Force, which is chaired by the hon. Member for Harrogate and Knaresborough (Andrew Jones), and praise its work. The report said that in tier 1 the Harrogate-Leeds-York line should be prioritised, but does the Minister agree that we must also put in the 1.1 mile of track to connect Yorkshire’s Leeds Bradford airport?
I congratulate the hon. Member for Harrogate and Knaresborough (Andrew Jones) and my hon. Friend on the their work, and I met them recently to discuss it. There is a strong case for investment in the Harrogate-Leeds-York line and in the rail link to the airport that my hon. Friend describes. Ensuring that degree of connectivity for one of the fastest growing airports in the country, which has huge potential for growth, could also take off the roads the traffic caused by people travelling to other airports in the country. We shall be considering the matter carefully.
The Minister will have noticed the substantial depreciation of the euro in recent times, which is bound to cause damage to the British economy. When will the Government take the exchange rate seriously and seek to secure an appropriate exchange rate for sterling?
We take seriously the need for this country to have a set of policies that ensure the long-term health and growth of the UK economy, and the appropriate mix of fiscal policy, monetary policy and long-term investment. That is why we have the fastest growth in the United Kingdom of any advanced economy, and why there are now more than 2 million more people in work in the private sector than there were in 2010. That is a record I am proud of, and the hon. Gentleman should congratulate the Government on it.
When considering the allocation of LIBOR fines, will Treasury Ministers consider carefully the submission of Alabaré Christian Care in my constituency? It is seeking to construct a new veterans village in Wilton that will be transformational for veterans across Wiltshire.
I am grateful to my hon. Friend for that question. As he will know, the LIBOR fines imposed on banks for the appalling rigging of LIBOR are being used for mainly military charities, and a few other ideas have been put forward. I shall bear his remarks in mind and mention them to the Chancellor.
Further to Question 8, what measures is the Chief Secretary taking to tackle the activities of payroll and umbrella companies that promote bogus self-employment which in turn fuels widespread tax evasion?
We have already announced measures to deal with intermediaries, both offshore and onshore. As the hon. Gentleman will know, a consultation on the issue is taking place at the moment, and it is important to ensure that companies cannot put in place artificial arrangements that are designed to reduce their tax bill and often have the consequence of removing important employment rights from workers. We continue to take that matter incredibly seriously.
Does the Chief Secretary agree that one key aspect of the long-term economic plan is investment in skills, and will he reassure the House that the Government will carry on doing that?
Yes I can. As this is national apprenticeship week it is worth reflecting on the fact that in this Parliament we have created more than 2 million more apprenticeships. That is a great achievement of this Government and has helped to ensure that young people have the skills they need to succeed in today’s economy. From my perspective that will continue to be a priority in the next Parliament.
To follow up the question from my hon. Friend the Member for Leyton and Wanstead (John Cryer), it appeared from recent written answers that the Government are leaving open loopholes that see workers lose hundreds of pounds a month from rip-off umbrella companies. Why is that?
As I said, we are consulting on that matter and have already taken considerable action to deal with intermediaries. I am sure that more will be said about the issue in due course.
Youth unemployment in my constituency has halved under this Government, and the Chief Secretary met some of the young people in new jobs at Anthony Best Dynamics in Bradford on Avon last year. Will he or the Chancellor accept an invitation to accompany me to one of the advanced manufacturing businesses in Chippenham which, with the support of the relevant Government programmes, can extend many more opportunities by creating jobs in 21st-century products in Chippenham?
I gladly accept the invitation, although time is limited. As my hon. Friend said, through visiting Anthony Best Dynamics I have seen precisely the benefits that apprenticeships can provide for young people wanting to get highly skilled jobs in the technology companies that are creating very high value added for the UK economy. The work that he has done in his constituency to promote businesses taking on apprentices is an example to the entire House.
Why was the Chief Secretary to the Treasury so discreet about the application for state aid for the three remaining deep mine pits in Britain? Is he aware that in February 2014 the Government took £700 million out of the mineworkers’ pension fund for themselves? That kind of money in state aid could save those three pits so that they could exhaust their reserves. Now come on—tell us what’s happening!
I am not going to change the answer I gave to the earlier question. I appreciate the sensitivity of these matters, and I would say that this Government have taken steps, wherever we can, to support that particular industry. I am not sure that it would be appropriate for me to comment further.
Last but not least, Sir Oliver Heald.
The Financial Secretary to the Treasury will be aware that Hertfordshire is a prosperous and successful county. However, it had reached the point at which growth was being compromised because the A1M was not being widened between Stevenage and Welwyn. That work has now been announced but, for the future, are the Government satisfied that they are planning such infrastructure projects far enough ahead to enable us to maintain the kind of strong economic growth that we have at the moment as a result of the long-term economic plan?
I am grateful to my hon. and learned Friend and fellow Hertfordshire Member of Parliament. He is absolutely right to highlight that issue. As my right hon. Friend the Chief Secretary to the Treasury said earlier, we have in place a pipeline of road building and train improvements, the like of which we have not seen for many years. All of that will benefit Hertfordshire in particular and the United Kingdom as a whole.
Troubled Families Programme
With permission, Mr Speaker, I wish to make a statement about this Government’s troubled families programme. In 2011, the Prime Minister set a bold ambition for this Government that by the end of this Parliament we would turn around the lives of 120,000 of the country’s most troubled families. Turning their lives around meant: drastically reducing the antisocial behaviour and crime for which they were responsible; ensuring that truanting children were back attending school; and getting parents into jobs. Today, with great pride, I can announce to the House that 90% of the families we promised to help have achieved those outcomes. More than 105,000 families have had their lives turned around, and the programme still has three months left to run.
I want to extend my gratitude to the army of front-line workers who have worked tirelessly with those families to bring stability back to their lives. I also want to offer my congratulations to the families who have grasped the opportunity that this programme has offered to them to end a dysfunctional and negative way of life and offer their children a better future. I also want to put on record the fact that the programme exemplifies how central Government, local government and their partner public services can successfully work together with a sense of common endeavour and shared objectives. All 152 upper-tier local councils across England, irrespective of political control, have worked closely with my Department, and it is only by working together that we have delivered this challenging programme at great pace.
In 2011, I was deeply honoured when the Prime Minister asked me to lead this programme, but I was also acutely aware that its bold ambitions had eluded the efforts of previous Governments. Looking back, we can see how the success of the programme has come from its simplicity, and from the clear aims and straightforward methods that have captured the hearts and minds of public servants at all levels.
I am sure that many Members of the House will know the frustration that comes from seeing how our services and systems have failed to deal with the root causes of problems and only treated, or reacted to, the symptoms. How many of us know families in our constituencies who have been failed by services but have at the same time placed a huge and disproportionate burden on those services through successive generations? Young men follow in their fathers’ footsteps into trouble; young women fall victim to abusive relationships; and families push through the revolving doors of hard-pressed services with recurring problems of addiction, violence and mental and physical ill-health.
I believed that there was a better way for those hard-pressed services to operate and through the troubled families programme we have found it. Families in the programme have signed up to a plan that gets to the root cause of their problems and makes a real difference to their lives. It involves tough love and practical help from people who take a no-nonsense, persistent approach, who will not go away and will not give up, and who will not be put off by missed appointments or unanswered doors.
A typical family in the programme has nine different problems to contend with. A child’s bad behaviour and truancy leads to exclusion from school and a life of petty crime. The school tries to help, but its efforts are undone by a mum who simply cannot get out of bed in the morning to ensure that her son goes to school. She suffers from stress and anxiety and drinks heavily. Why? She is in arrears on her bills and is regularly beaten up by the boy’s dad. The result is that the child’s poor prospects become entrenched and the cycle of the family’s problems continues.
The key worker’s job is to break the cycle and they will prioritise what needs to change first. In this case, they will get the police and others to stop the violence and help the mum to budget better and start on a path to employment. For a while, the key worker will arrive at 7 am to ensure that she is up, making some breakfast for her son and packing him off to school. As her mental health improves and improvements grow, the key worker can step back, mentor and gradually let go.
The figures we are publishing today prove beyond doubt that the approach is working for families. It also helps the communities where they live and of course delivers substantial savings for the taxpayer. The key worker has replaced the expensive swarm of services buzzing around the family that deal with individual symptoms rather than addressing the root causes.
Today, my Department is releasing new information from local authorities that clearly demonstrates the savings generated by the programme. This year, Manchester estimates that for every £1 invested in family intervention, local public services receive an estimated £2.20 in savings. For Redcar and Cleveland, the figure was £1.94. For every four families helped under the programme, the equivalent of a police officer’s starting salary could be saved. In the London borough of Wandsworth during the first year of the programme, the total savings from reducing demand on the criminal justice system were nearly £1.2 million. The 70% reduction in domestic violence in the families being helped saved the borough £70,000. Salford has identified benefits to health services of £1,700 on average per family. Those savings follow a nearly 60% reduction in alcohol abuse and a 50% reduction in drug misuse in the 12 months following family intervention. If those savings were representative of all the 105,000 families who have been turned around by the programme so far, a total of £1.2 billion would be generated in gross fiscal benefits.
Those gains for the public purse are reason enough for celebration, but what makes me most proud of the programme is its impact on people’s lives, especially in getting family members into work. That is no easy task when we consider that they were previously a million miles from being able to hold down any kind of job. Figures released today show that more than 10,000 adults from troubled families have moved into sustained work. I want to take this opportunity to express my gratitude to my right hon. Friend the Secretary of State for Work and Pensions, who placed 150 of his jobcentre advisers in local troubled families teams. They have worked wonders in some really challenging cases.
This approach works for taxpayers and the families involved in the programme, and this Government will build on that success. I am delighted that we have secured cross-Government support for an additional £200 million of funding for an expansion, to work with 400,000 more families from 2015 to 2020. That work has already started ahead of time in two thirds of areas.
I would like to end by referring to a letter from a head teacher in Leicestershire to her troubled families team. She confesses to being a
“notoriously grumpy Head Teacher on welfare issues”,
but says that the troubled families team is “something quite different” that she “can’t praise enough.” Why is that? It is because
“for once, everybody seems to know what is going on”.
She concludes by saying:
“I have never come across anything quite like this before.”
Neither have I. That is why I am genuinely honoured to have led this remarkable, life-changing programme for the Government, and why I am delighted that it is being expanded to help more troubled families across the country. I commend this statement to the House.
May I begin by thanking the Secretary of State for advance sight of his statement, and for his personal commitment to providing support to local authorities up and down the country that are working with the most excluded families through the troubled families programme?
It is not often that we in this House pay tribute to public servants, and we do not do it as much as we should, so I would like to thank Louise Casey for the leadership she has shown and all the staff working in all the projects for their extraordinary dedication, patience and commitment. Their skill in, above all, building trust with the families they work with is absolutely fundamental if together they are to succeed.
We on the Opposition Benches support this important work. As the Secretary of State has generously acknowledged, the previous Labour Government started the family intervention project, and a future Labour Government would want to see this work continue and go from strength to strength.
As the Secretary of State will know, a number of local authorities and Labour pushed for the original criteria to be broadened to enable local authorities to provide support to those families most in need and to ensure that there was proper long-term follow-up to see whether families could maintain the progress that had been made. I welcome the fact that the Government listened to those representations and made the necessary changes.
It is clear that we need to provide hands-on support to families with multiple complex needs, in order to help them to break cycles of disadvantage. It is also clear that we need to move away from trying to contain problems, at great expense, towards trying to prevent them in the first place. What assessment has the Secretary of State made of the concentration in the most deprived communities of families taking part in the troubled families programme? I ask that because we know that, under this Government, households living in areas that rank in the 10 most deprived communities have seen their local authority spending power reduced by 16 times as much as those in the 10 least deprived communities.
Demands on children’s services are increasing and the figures show that local authorities are doing their best to protect them. However, the National Audit Office has found that, between 2010-11 and 2014-15, budgeted spending on children’s social care actually fell by 4.3% on average in authorities with the highest cuts in Government funding, compared with real-terms increases of 14.8% in authorities with the lowest cuts. How is that going to help?
Last August, it was announced that the troubled families programme would be expanded to work with 400,000 more families from 2015 to 2020, with funding of £200 million for 2015-16, but the Secretary of State has just said that he has secured cross-Government support and an additional £200 million for its expansion from 2015 to 2020. Will he confirm whether that £200 million is for 2015-16 or for the whole period from 2015 to 2020?
The Secretary of State referred to the 10,000 adults who have moved into sustained work, which is a great achievement, but it still leaves more than 100,000 families where that has not happened. Would it not help those families if we were to guarantee a job, as Labour is proposing, to every adult who has been out of work for more than two years and every young person who has been out of work for more than a year?
The Secretary of State rightly talked about the problems that a number of these families have in paying bills. How many troubled families are being hit by the profoundly unfair bedroom tax? Surely, to help them, that tax should be scrapped, as we have committed to do? Why are the Government so intent on penalising people on the lowest incomes, and how many of those families currently rely on food banks to help feed their children?
Over this Parliament, the Secretary of State has spoken regularly about the number of families who have been turned around. However, within the original programme, a family could be so classified if they reduced the level of crime committed by just a third. Will he confirm whether such families are counted in the total he gave today?
In 2011, the Prime Minister said that troubled families were costing the state an estimated £9 billion a year. However, in his statement today, the Secretary of State said that if these savings were representative of all 105,000 families so far, it would generate a total of £1.2 billion in gross fiscal benefits. Can he square those two figures and confirm whether these savings are in fact being achieved? As he will be only too aware, demonstrating savings will be really important for securing future funding for the programme from other parts of Whitehall.
We know that intensive support really can help families transform their lives. Raising children can be challenging and we can all do with help and advice at times. We support the programme precisely because the local authorities that are implementing it on the ground are convinced that it makes a difference. However, the Government also have a responsibility to help all families, whether in difficulty or not, in other ways. Insecurity, zero-hours contracts, a lack of affordable housing and high rents are real concerns for them. If we are really to help all Britain’s families, we need a Government who will do something about those things as well.
I am most grateful to the right hon. Gentleman for his comments. In particular, I would like to endorse his views on Louise Casey. It has been a privilege over the past five years to get to know a number of senior civil servants, but none have I enjoyed working with more than Louise, who is definitely one of a kind. She has been an absolute joy to work with. I also recognise that none of this could have been achieved without all-party support.
The right hon. Gentleman made a number of points on how we can demonstrate success and square the £1.2 billion with the £9 billion. He knows as well as anybody that this is notoriously difficult territory, because Governments of all types are absolutely terrible at measuring outcomes. We have made a start—he might have had an opportunity to look at the research—by looking at seven exemplar authorities and extrapolating the findings to produce some financial analysis. To answer his questions, I think that it is only fair to have that audited independently. As he will know, we are due to have a very comprehensive audit of the programme. I am confident that the exemplar authorities indicate what has been achieved. I think that I have been conservative—no pun intended—in estimating what can be achieved.
The right hon. Gentleman made a number of points about spending power. The point needs to be made that the Government are spending the most in the most deprived areas; we are spending an awful lot less on prosperous areas. I remind him, with great humility, that under the system in place before this Government came in, we were throwing money at the problem and achieving precisely nothing. By addressing some of the social ills, dealing with the problems, shoulder to shoulder with Conservative, Labour and Liberal Democrat councils, we have been able to achieve these benefits. It so happens that it is cheaper, but it is actually better and more caring, because we are not throwing people away, condemning them to a life on benefits.
Having been Minister for Criminal Justice at the birth of this programme, and having seen it operating on the front line in my constituency since, may I join my right hon. Friend in congratulating Louise Casey? I congratulate him on the leadership he has given, along with the Secretary of State for Work and Pensions, in bringing this home. I slightly regret the tone taken by the shadow Secretary of State, which I think disguises a recognition that the programme has really worked by bringing all the agencies together, which is something he and I saw back in 2000 when we served together on a Select Committee. I ask my right hon. Friend to ensure that we learn the lessons that will emerge from the first four years of the programme and see that it carries on in the excellent way it has started.
I am most grateful to my hon. Friend. It is of course important that we learn the lessons of the programme. I think that it has been quite clear that by keeping things as simple as possible, by looking very carefully at the different criteria and by having a completely straightforward approach—some Members have suggested that we might be fiddling the figures by reducing crime, although reducing crime seems to me to be pretty important—we have kept the programme transparent, so people can actually see it. I believe that we have treated everyone in this process with respect, particularly the troubled families.
The Communities and Local Government Committee has been very supportive of the whole approach on troubled families. However, when the Secretary of State announced his expansion of the programme in 2013, the Committee pointed out that the increase in Government funding was not in proportion to the increase in the number of families to be helped. Does he believe that local authorities can be as successful in future, given the reduction in the amount that central Government spend per family? Given that savings to one public body can be a cost to another as part of the programme, will not real success in the end be the roll-out of whole-place community budgets, so that a proper account can be taken with a total approach to public expenditure in an area? How does he see that being rolled out alongside the troubled families programme?
The hon. Gentleman makes a very interesting point. It is usual for a Government to aim for the low-hanging fruit when starting such a programme, doing the easy things first before going on to those that are more difficult. We did exactly the reverse by starting with the most difficult families. The troubled families involved in the extended programme have nothing like the complex needs of those in the first tranche, so I think that it will be easier, cheaper and better when we start dealing with them. With regard to money coming in, he might be interested to know that in Sheffield there were 1,680 troubled families over that period, 100% of whom have been turned around, with expenditure of £6.6 million. In Leeds, there were 2,190 troubled families, 100% of whom have been turned around, with expenditure of £7.79 million.
I, too, congratulate the Secretary of State, Louise Casey and all those associated with the programme, not least the participants. How does he envisage the lifestyle changes being sustained as we move on to this very welcome and massive expansion of the programme?
We need to be absolutely clear that we are almost certainly not turning out model citizens. We are, however, giving children from troubled families the opportunity to have a better chance of success. That is something we are keen to monitor, check and make sure happens. In that way, we have an opportunity to break the cycle.
I thank the Secretary of State for his statement. The programme in Stockport is very impressive in bringing together local agencies to help families. He will be aware that there is an under-reporting of child abuse, child sexual exploitation and other forms of abuse in many of these families. Does he agree that one of the outcomes, in measuring the success of the programme, is the prevention of child abuse and child sexual exploitation in these families?
The hon. Lady is the author of a very good report on the subject of child sexual exploitation, and she and I discussed this matter at a seminar last week at Downing street. She makes a very reasonable point. I think the reason the programme has had a fair amount of success is that it does not deal with this problem through social services or the benefits agency alone. There have to be different disciplines in the room. The same applies to tackling child sexual exploitation. Social work is very well set up and very good at dealing with child sexual exploitation within a family; when the problem involves organised crime, it becomes more difficult to deal with. I think the point she made at the seminar is this: who would have thought that we would need to regulate taxis and the night-time economy to deal with child sexual exploitation? A broader approach will bring much better co-ordination and the greatest chance of success. I agree with her.
I, too, congratulate the Secretary of State on his vision, persistence and leadership in seeing through this very important programme that helps to change lives and transform people’s prospects. Will he tell the House how many children have benefited from this programme and will now be able to fulfil their true and fullest potential?
Time will tell how many children will benefit in the end. Getting children back into school and attending three successive terms makes a big difference. In my hon. Friend’s area, the total number of families we would describe as troubled is 2,560. Some 80% have been turned around. So far, just short of £10 million has been expended in that process.
I congratulate the Secretary of State, Louise Casey and the families who have turned their lives around. On behalf of my constituents, many of whom now have a more peaceful existence, may I also, through him, thank the front-line workers who have brought about these changes? In “Feeding Britain”, the cross-party inquiry into hunger in this country, the Secretary of State may recall that, although we drew attention to those families who simply did not have enough money to feed their children, there were other scallywags who could not be bothered to feed their children. Is it possible for him to confirm that schools, which prevent those children from being hungry, could in the next stage have the right to refer families directly to the troubled families unit?
It works, I think, remarkably well now. The right hon. Gentleman will recall that in the main part of my statement I referred to a head teacher from Leicestershire. It makes a big difference if we involve everyone. Sadly, I have not visited Birkenhead in this process—I know that 80% of the 910 troubled families there have been turned around, with £3.3 million expended—but I was fairly close by, to look at the team in Chester. It is the most remarkable thing to see a whole bunch of people from different disciplines sitting down together, including representatives of firefighters, who play an important part in picking up intelligence and information.
The families supported by this programme are often affected by multiple problems, which are then responded to by multiple agencies. Is the success of the scheme not due to the ability of Louise Casey and her team to cut across the previous silo mentality and join up the support that has enabled lives to be changed?
I agree entirely with my hon. Friend, who should know that there are 805 troubled families in his local authority. Some 99% of them have been turned around, with an expenditure of just slightly more than £2 million. Louise Casey is a remarkable woman, but this could not have been achieved by her presence and determination alone, formidable though they are. We are bringing people along and they are getting the opportunity to do something about the process. I have seen an enormous sense of leadership in different authorities right across the country, because they can now do something about the problem.
I welcome the announcement of the future funding for this programme, but the Secretary of State failed to answer my right hon. Friend the Member for Leeds Central (Hilary Benn) and say whether the £200 million is for 2015-16 or the full five years of the next Parliament. On current funding, the Secretary of State has been withholding from Rotherham council about £750,000 in troubled families and transformation award funding. Given the special circumstances and the challenges we face, will he now release that funding to Rotherham?
As far as the right hon. Gentleman’s constituency is concerned, there are two local authorities. Barnsley, with 645 troubled families, has achieved a 95% turnaround, which has cost slightly more than £2 million. Rotherham, with 730 troubled families, has achieved a 89% turnaround, which, again, has cost slightly more than £2 million. He makes a really interesting point: even in that sea of dysfunction, the work with troubled families has been very successful. I am delighted to tell the right hon. Gentleman that I have released the money. The money will go to Rotherham today.
I sincerely thank my right hon. Friend for his leadership of this project, which has helped to turn around the lives of 1,165 families in West Sussex. Will he join me in sincerely thanking the workers in my constituency who have made such a positive difference to individuals and to our community as a whole?
I think the House is divided into those who know exactly the number of troubled families in their areas and those who do not. I confirm that my hon. Friend’s arithmetic is absolutely correct. I also confirm that the improvement is entirely due to the enormous hard work of the people in his area determined to make a difference.
This is an important and successful approach. It is the kind of approach that I took when I first started my social work career more than 30 years ago and that, in those days, many social work staff took. One of the reasons why silos developed was the pressure on budgets. Given that many local authorities have tried to protect children’s services but they continue to be under threat, how will the Secretary of State ensure that services, which are preventive and help troubled families through this programme and children’s services, continue and are given priority, so that we do not go backwards, whether with children’s services or troubled families?
The hon. Lady’s analysis is good. I think there has been too much silo building taking place inside local government. It has been almost like, to mix a metaphor, laagering the wagons. That has been a mistake. It is not possible to deal with something as complex as troubled families by relying solely on social work or a children’s department. It involves many other agencies. We get change in government when we deal with issues. We tend not to work terribly well when we become obsessed with governance.
The Secretary of State deserves praise for taking this originally Labour policy and pursuing it energetically to this stage, and on any other day I would welcome it and celebrate it with him unreservedly, but this is the day when Her Majesty’s inspectorate, Ofsted, revealed that two thirds of children’s services departments are in a dire situation. Children in this country are exposed to great danger, and departments up and down the country are at risk because of the cuts to local government finance. Will he put that in context and please come back to the House to tell us what he is going to do about it?
When the hon. Gentleman decides to give praise, I sincerely hope that I am here to see it, but I think that it is some distance in the future.
Given that the shadow Chancellor has made it absolutely clear that there is no additional money for local government, the hon. Gentleman’s comments ring rather hollow. Had he read the report carefully, he would have seen that it specifically states that our approach to troubled families offers them a future and the best way of doing things, and he should be aware that, in Kirklees, he has 1,115 troubled families and that 88% of them have been turned around, with an expenditure of just short of £4.5 million.
The savings the Secretary of State has mentioned are welcome, but surely the scheme’s value should be measured by its impact on individual lives and its success in lifting families out of hopelessness, bringing them into sustainable work and giving them hope for the future. I welcome that, but what consultation or discussions about the scheme has he had with the devolved Administrations?
We have kept the devolved Administrations completely informed of what we are doing, and I would urge them to take this up. It is clear that the project works, and I think that we could see benefits across the piece. I absolutely endorse what the hon. Gentleman says about the proof being life change—the money is great and the savings are wonderful, but it is the changed lives that we are after.
Trade Union Reform (Civil Service)
With permission, Mr Speaker, I would like to make a statement on trade unions in the civil service.
Trade unions can play an important role in the modern workplace. Some important reforms implemented under the coalition Government, such as changes to the civil service compensation scheme and public sector pensions, were the subject of extended and constructive discussions with a range of public sector trade unions, and I am grateful to union leaders for the forward-looking and thoughtful way in which they have engaged with the need for reform. However, further reforms were needed to how the unions operated within the civil service, and I want to update the House on progress.
Facility time describes the arrangement whereby union officials and representatives have paid time off for trade union duties and activities. Properly controlled and monitored, this can assist with the rapid resolution of local disputes and grievances, but five years ago in the civil service, it was neither controlled nor monitored. We found that thousands of civil servants were paid, sometimes including travel costs and expenses, to attend union conferences. We found that more than 200 civil servants were being paid to work full time on union business. Several had been promoted, one of them twice, without ever doing the job for which they were employed.
The total cost to taxpayers of trade union facility time taken by these officials and the thousands of other part-time representatives was a staggering £36 million a year. Unacceptable at any time, this was particularly intolerable at a time when the coalition Government were making difficult decisions to get the country’s finances back on track. Facility time in the civil service is now rigorously monitored and reported. Now, unless specifically authorised by a Minister, all trade union representatives must spend at least half their time doing the civil service job for which they were employed. Gone is the automatic paid time off to attend seaside union conferences.
Today I can tell the House that the cost of trade union facility time has dropped by nearly 75%, from £36 million in 2011 to just over £10 million now, saving taxpayers £26 million a year. The cost has fallen from 0.26% of pay bill to just 0.07% for the latest rolling year to date—well below the benchmark we set of 0.1%. I can also reveal that the number of full-time trade union officials on the public’s payroll has fallen from 200 in 2011 to just eight today. With the civil service now over one fifth smaller—like for like—than it was in 2010, I expect the overall number of representatives to continue to fall over the coming years.
Check-off is the practice where the employer collects trade union subscriptions from payroll on behalf of the union, and decisions on whether this should continue are delegated to individual Departments. The civil service management code requires Departments to recover the cost of check-off from the unions, which only two Departments were doing, so the head of the civil service has written to permanent secretaries of Departments where check-off remains to remind them of this obligation. So far, eight Departments have served notice to the trade unions that they intend to remove check-off: Her Majesty’s Revenue and Customs, the Ministry of Defence, the Home Office, the Department for Communities and Local Government, the Department for International Development, the Department for Work and Pensions, the Department for Environment, Food and Rural Affairs and the Foreign and Commonwealth Office. Others have started the consultation process to allow this to happen. I believe that this change will enable unions to build a much more direct relationship with their members, without the need for the relationship to be intermediated by the employer.
Taken together, these reforms have made a considerable contribution to modernising Departments’ relationships with their trade unions—reforms that were long overdue—and I commend the statement to the House.
What was the point of that?
Well, it was apparently judged worthy of an oral statement.
I thank the Minister for advance sight of the statement—it is good to see that at least this member of the Cabinet is not ducking difficult questions in Parliament today.
It is election time, so we have a Tory Minister coming to the House as part of a pre-election union-bashing exercise. There is absolutely nothing new in this statement, so one wonders what his motives are. The Government have a clear strategy towards public servants up and down the country: “The Government do not value the work you do and are hellbent on disfranchising you and weakening your rights at work.” Government Members, especially those in marginal seats, should be worried about the impact this is having on public sector voters in their constituencies.
One has to ask whether this so-called statement is just a smokescreen for a Prime Minister running scared of a debate about the future of our country and a Chancellor whose economic plans threaten £70 billion of cuts that would take us back to a time before there was even an NHS. This Minister is a reasonable man, and I support what the Government are doing on many aspects of civil service reform, but I will not support the steps he has taken under the name of trade union reform, which have resulted in souring relations, low staff morale and unnecessary industrial action, and have scuppered some of his otherwise valiant attempts to change how government is run.
Facility time is an important resource not just for union members and employees but for the employer and, in this case, the taxpayer. Labour is clear that facility time is not political time; where well deployed and not abused, it reduces many human resources costs to a company, such as by reducing the number of disputes going to an employment tribunal, recruitment costs and the number of days off sick and workplace injuries. That is why some of the biggest companies, such as Rolls-Royce and Jaguar Land Rover, support facility time—because it is part of an effective HR strategy and a productive workforce.
Of course, we support genuine attempts to eradicate abuse, but the Government’s rhetoric tells a different story—one that is more about their political ideology than good accounting. Check-off is another example. Many major private employers use it: in construction, there is Balfour Beatty; in pharmaceuticals, there is AstraZeneca; in manufacturing, there is BAE Systems, GKN and Rolls-Royce. All of these private sector companies recognise its benefits, but unsurprisingly this Conservative-led Government have done everything they can to end check-off. Given that the cost of check-off is relatively low and that most unions are happy to pay the cost of administering it themselves, it is clear that this is another stage in the long campaign to weaken trade unions and disfranchise their members. Would it not have been better to give the trade unions and their tens of thousands of members across government proper and ample time to move members on to a direct debit system, which I am sure we all agree is more sustainable in the long-term? That is what we will do, and I want to put it on record that when we win in May, we will ensure that this is made possible across all Departments.
The Minister has come to this House today with his Lynton Crosby route 1 election strategy: bash the unions and duck the leaders’ debates. Hard-pressed public sector workers will see this for what it is, and they know that they deserve better than this.
It is lovely to see the hon. Member for Manchester Central (Lucy Powell) taking time off from her pressing duties of holding the Labour party’s election campaign together. It is good to have her here. I thank her for her gracious support for most of what we do. It is important to stress that much of what we have done on civil service reform has commanded widespread support across the political spectrum. I am grateful to her and her predecessors for the constructive way in which they have done that—[Interruption.] The hon. Member for Kingston upon Hull East (Karl Turner) makes a comment that is rather less graceful than his colleague.
It was me.
It is very hard to tell.
Let me deal head on with the hon. Lady’s points. She says that this is an attack on public servants, but it is absolutely the contrary. She talks as if this is an attack on union facility time. It is not. I said in my statement—she might have listened to it; she had it in advance—that I supported the use of facility time. Facility time for trade union duties is protected by law. Trade union duties—the resolution of disputes and grievances—are important, and the presence of trade union officials and representatives within the workplace can be helpful in achieving that. What we are concerned with is the abuse and the use of paid time off in facility time for large numbers of civil servants to attend their union conferences with their expenses paid by the public. That is not acceptable. That is what we have called time on.
I know that the hon. Lady and her colleagues do not like it, and we know what the reason is. The reason is perfectly simple: it is that the Labour party is paid for and puppet-mastered by the trade unions. She should come clean and say that the Labour party election campaign that she is trying to hold together and conduct is paid for by exactly the trade union leaders who have no doubt written the script that she has read out to the House today.
The practices that the Minister described as seeing on his arrival at the Cabinet Office in 2010 will have come as a complete shock to my constituents. May I tell him that my constituents will very much support the steps he has taken to ensure fair use of union time by officials?
My hon. Friend is completely right. To be honest, it was a complete shock to us to see how much this system had been abused, and how little effort was made by our predecessors to count and control the costs of what was happening. Opposition Members say that this is an attack on public servants, but the truth is that public servants would much rather have this money spent on public services, which is their vocation, than on supporting trade union officials at the taxpayers’ expense.
We are going to have to develop some criteria for providing statements to this House, because this is a complete waste of the House’s time. The Minister needs to get up to speed: the Public and Commercial Services Union has never been affiliated to the Labour party and has never funded it, so he can drop these accusations. This is all about union busting, so I want to know what investigation took place into the union-busting strategy within HMRC, where leaked reports said that trade unionists were to be victimised and the union to be broken within that department. What did the right hon. Gentleman do about that?
First, I never said that about the PCS. I know it is not affiliated. The PCS dislikes the Labour party nearly as much as it dislikes us. Secondly, when it comes to attacks on public servants, the hon. Gentleman’s attack on hard-working public servants in HMRC—the management of HMRC, those senior hard-working officials who have decided in conducting their vocation of public service that check-off should be discontinued—is disgraceful.
Does my right hon. Friend agree that unions can perform an important role in the workplace, but that the creation of a so-called super union would damage the perception of the independence of civil servants and that many would wish not to join such a union?
I saw a report this morning suggesting that there was a plan, not yet divulged to the public, for the PCS to be swallowed up by Unite. Civil service political impartiality is an essential part of the way in which our system of government works. For the largest civil service union to be controlled by the same puppet-master and paymaster that controls Labour would be a matter—[Interruption]—of very considerable concern—
Order. When I say the Minister is finished, let it be clear. It is no good him sitting there shrugging. When I say he is finished, he is finished. It is important not to waste the time of the House. It is beneath the level of a Minister.
Government Departments offer a range of check-off services to their employees, including deductions for membership fees, for private sporting clubs, for private clubs more generally and even for private medical schemes. What is it that makes the payments of trade union dues exceptional? Why would any employer want to withdraw this from its own employees?
As the right hon. Gentleman, who is knowledgeable on this subject, knows, many employers have taken exactly this step. Many unions have sought to withdraw from check-off arrangements themselves, because they take the view that a modern union in a modern workplace should have a direct relationship with their members, not intermediated by the employer. Check-off dates from an era when many people did not have bank accounts and direct debit did not exist. It exists now, and many unions take the view, and indeed the PCS has said, that the easiest way to collect their dues is through direct debit.
Will the Minister join me in congratulating the TaxPayers Alliance on its important work which shows that £100 million of public money is wasted on facility time? Does he share my concern that a PCS-Unite merger would undermine our democracy and mean that the Labour party would be even more bought by the unions than it is today?
I make the point again that the perception of political impartiality in the civil service is fundamental to our system of government. That should not be imperilled in any way. My hon. Friend is completely right to draw attention to the much wider scale of facility time and the cost borne by the taxpayer—money that would be better spent in the delivery of front-line public services on which vulnerable people depend. That is something that all public authorities should be looking at.
Is the Minister aware that all he needed to say today was quite simple: Tory Ministers are continuing their spite and vendetta against trade unions? This is nothing different from what has occurred previously.
That was not really a question, Mr Speaker, but by way of response, most public servants and most members of the public and the people who use public services would prefer the money to be spent on the delivery of public services, not on the delivery of trade union salaries.
This statement is called “Trade Union Reform (Civil Service)”, so will the Minister correct himself and the record and confirm that none of the civil service unions is affiliated to the Labour party or pays towards it? Rolls-Royce, Tesco, Virgin Media, Odeon Cinemas, Jaguar Land Rover —some of our biggest and best British companies—work with trade unions, recognise trade unions, and offer check- off to trade union members and facility time to their representatives. Why are the Government not dealing with their staff and unions in the same decent, modern way?
I support the use of trade union time, but it must be controlled and monitored, and it must not be abused. I also support the presence of trade unions in the workplace, and I personally have worked very closely with them. The Chief Secretary to the Treasury and I spent 12 months in productive discussions with the TUC and public sector trade unions when we were considering public sector pension reform, and we made a number of changes to reflect the concerns of the unions that were prepared to engage with us. I need no lectures about the importance of engagement with the unions, but the arrangements should be controlled and modernised, and the right way for that to be done is the way that I have described.
I have seriously tried to understand the rationale for what the Minister has announced. It appears that the management were not controlling the check-off arrangements properly, because the unions would have paid the costs willingly, but those costs were not paid. It also appears that the management could have monitored the difference between facility time for activities and facility time for duties, but did not do so. That suggests a failure in senior management. As for attendance at conferences, it seems that trade unions will still be paid if they hold their annual conferences in Newcastle, Glasgow, Birmingham or Liverpool, because the Minister mentioned only seaside conferences. The truth is that this is nothing more than another attempt to find the bogeyman whom the Conservatives have tried to find for the last five years. They want another Arthur Scargill so that they can try to rattle a can in the next few weeks. That is what this is all about.
Given that Opposition Members apparently do not think the statement should have been made, they are finding plenty to say about it. Indeed, we are having a good and productive debate. It is important for the issues to be debated, because they do matter.
As I said, I take my relationship with trade unions very seriously. I continue to chair the public services forum which was set up under the last Government. We engage with each other very fully, and I am happy to say that I have warm relationships with a number of trade union leaders.
I am probably the only Member of Parliament who is a former branch secretary of the First Division Association, and I think that the Minister’s attempt to divide junior from senior officials is wholly misconceived. It reminds me of the time when Mrs Thatcher kicked the trade unions out of GCHQ.
Why has the Minister chosen this moment to crack down on check-off? Has he done so because the Office for Budget Responsibility has forecast a 1 million reduction in the number of public servants, and he wants to weaken the unions before that happens?
The hon. Lady’s mind is more elaborate than mine. We have looked at this in a perfectly sensible, straightforward way. We want trade unions in the civil service—and in this context I am talking only about the civil service—to engage in a sensible, modern fashion, and we want public money to be deployed in the delivery of public services rather than the delivery of trade union officials’ salaries.
The Minister said that Departments were entitled to recover the costs of check-off from the unions, and rattled off a list of Departments that were ending check-off. Have any of those Departments made any attempt to negotiate with the unions on the costs of check-off, or does the Minister simply want to get rid of check-off altogether?
For many years, the civil service management code has obliged Departments to recover the costs of check-off from the unions, but only two have been doing so, namely the Ministry of Defence and HMRC. Check-off remains in place in a number of Departments, and the head of the civil service has very properly written to their permanent secretaries telling them that they should rectify the position.
Point of Order
On a point of order, Mr Speaker. I am a new Member of Parliament, but I understand that it is a convention in the House for a Minister, or any other MP, who is to visit a constituency to inform the Member who represents that constituency. Over the last six weeks I have had the pleasure of receiving numerous visits from Conservative Ministers who, no doubt, have wished to see how a Liberal Democrat-controlled council and the Liberal Democrat MP are managing to make such a good fist of it in Eastbourne, and they have always been kind enough to let me know, even when there has been only an hour to go before their arrival. However, I was disappointed to discover that the Secretary of State for the Home Department had visited my constituency yesterday, and I had not been notified.
This morning I spoke to Beryl Healy, who is a former mayor of Eastbourne and a well known and established constituent of mine. She told me that she thought that this was simply bad manners, but I believe that the Home Secretary is a very courteous parliamentarian, and I admire her courtesy even when I disagree with her. In that respect, I feel that she has let me down. Can you advise me on how I can address the Home Secretary on this matter, Mr Speaker?
The hon. Gentleman has made his own point in his own way, and he has used the device of a point of order to register his discontent. Let me say this to him. The convention—and it is not a rule or a law—is well established, although I am sorry to say that it is frequently honoured as much in the breach as in the observance, a phenomenon that tends to be exacerbated in the run-up to an election.
I would prefer Members to resolve these matters satisfactorily without their having continually to be aired on the Floor of the House. I am sympathetic to the hon. Gentleman, but I think that he must now rely on his own devices to ward off repeat performances that he judges to be discourteous.
Motion for leave to bring in a Bill (Standing Order No. 23)
I beg to move,
That leave be given to bring in a Bill to amend the Mesothelioma Act 2014.
Let me begin by paying tribute to my predecessors Paul Goggins and Lord Morris of Manchester. Paul had been fighting hard for mesothelioma victims shortly before his sad death last year. Alf, who introduced me to public life, had been doing likewise, seeing that work as an extension of his groundbreaking Chronically Sick and Disabled Persons Act 1970. Today, I walk in the footsteps of giants.
Mesothelioma is an invasive form of lung cancer, caused primarily by earlier exposure to asbestos. There is currently no cure. Patients often experience complex and debilitating symptoms, and most die within 12 months of diagnosis. The United Kingdom has the highest rate of the disease in the world. Mortality rates are increasing, and have more than quadrupled over the last 30 years. It is estimated that more than 2,500 people will die of the disease in the UK this year, and that during the next 30 years about 60,000 will die unless new treatments are found.
Relatively little is spent on mesothelioma research in the UK in comparison with what is spent on other cancers involving comparable mortality. In 2012, the National Cancer Research Institute reported that just £1.2 million had been invested in research by its partners. That is significantly less than the £9.9 million and the £5.3 million that were spent on, respectively, skin cancer—or melanoma—and myeloma, two conditions that kill a similar number of people each year.
Research funding could have helped Derrick and Adele. Derrick was diagnosed with mesothelioma in December last year and sadly died just over a month later, on 17 January this year. He was exposed to asbestos as a young joiner in the early 1950s, when he was working on council houses and building pre-fabs. Like many joiners and construction workers, he was exposed when working with insulation board and corrugated roofing—both were used widely in the construction industry between the 1950s and the 1980s—all of which was riddled with asbestos.
Although the dangers of asbestos were well known to those who produced the materials, Derrick was not advised of those dangers; nor was he given protective equipment to shield him from the asbestos fibres. He had had no known exposure to asbestos after 1956, but his exposure to it as a young man was enough to lead to the diagnosis of terminal cancer nearly 60 years later.
Adele is a 46-year-old old single mother who was diagnosed with mesothelioma just before Christmas 2014. As a young hairdresser, she had been exposed to asbestos fibres that were contained in the old-style hood hairdryers. Hairdressing is not typically thought of a job that would cause such a risk. Unfortunately, asbestos has been a feature in many different workplaces, and it can take only very low level, or fleeting, exposure to cause mesothelioma. The added tragedy for Adele is that her father was also diagnosed with the disease less than six months before her own diagnosis, caused by exposure at his own workplace, a double burden for this close-knit family to endure.
The results from the funded research projects have, however, been impressive. New researchers from other areas of therapy have started taking an interest in mesothelioma, bringing with them new expertise and insights. MesobanK, Europe’s first mesothelioma tissue bank, has been created to collect and store biological tissue from patients for use in research, and work is being funded to identify the genetic architecture of the disease.
There have been ongoing conversations with the insurance industry regarding research funding for many years now. In January 2015, it was announced that two insurance companies—Aviva and Zurich—had agreed to donate a combined £1 million over two years to the British Lung Foundation’s mesothelioma research programme. However, although the funding from Aviva and Zurich is welcome, £500,000 a year alone does not come close to addressing the multimillion-pound funding deficit currently endured by mesothelioma research when compared with cancers of comparable mortality. Many more insurance industry donations of this kind will be required to justify the preference, expressed by several MPs during the Mesothelioma Act 2014 debates, for such funding to be secured through voluntary agreements, rather than to have a statutory underpinning. It is estimated that there are 150 insurance firms active in the employers’ liability insurance market, and a small statutory contribution from each could transform mesothelioma research. That is what this Bill hopes to achieve today.
The recent funding I have already mentioned is only secured for two years. This does not address the need to put funding on a sustainable footing. We need this for the benefits of research breakthroughs to be built on, and not lost. Dr Peter Campbell, who is conducting research identifying which genes are the most important targets for mutations, has stated:
“Only by understanding its basic biology will we be able to develop a new generation of drugs targeted at the specific abnormalities of mesothelioma cells. This requires sustained investment at all levels of mesothelioma research, from basic genetics and cell biology through drug development to clinical trials.”
Dr Robert Rintoul, who works at MesobanK, sees the importance of research not only for the UK, which is dramatically affected by this disease, but the rest of the world. He says that
“asbestos is still being used in an unsafe and unregulated way. Although the number of cases of mesothelioma in the UK will fall over the next 30 years, there will continue to be an epidemic of the disease globally and the lessons that we learn today about the biology of the disease will be used by doctors the world over in years to come.”
Unless a change is introduced in the way mesothelioma research is funded, we risk stagnation and endanger potential life-changing, even life-saving, breakthroughs. Currently, research relies on ad hoc contributions from insurers, charitable donations and modest funding from the Government. This unreliable approach to funding jeopardises ongoing research, impacting not only the British research industry but mesothelioma mortality in the UK. That is why statutory funding is needed; it must be secured for the research.
Let us commit on this day, at this time and in this place to Derrick and Adele, and to those who did not make it and those to come, to make the change required. I beg to move.
Question put and agreed to.
That Mike Kane, Andy McDonald, Mr Andy Slaughter, Tracey Crouch, Ian Paisley, Sammy Wilson, Jim Sheridan, Jim Shannon, Dr Wollaston, John Woodcock, Mr lain McKenzie and Steve Rotherham present the Bill.
Mike Kane accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 27 March 2015, and to be printed (Bill 185).
Deregulation Bill (Programme) (No.3)
Motion made, and Question put forthwith (Standing Order No. 83A(7)),
That the following provisions shall apply to the Deregulation Bill for the purpose of supplementing the Order of 3 February 2014 in the last Session of Parliament (Deregulation Bill (Programme)), as varied by the Order of 14 May 2014 in that Session (Deregulation Bill (Programme)(No. 2)):—
Consideration of Lords Amendments
(1) Proceedings on consideration of Lords Amendments shall (so far as not previously concluded) be brought to a conclusion three hours after their commencement at today’s sitting.
(2) The Lords Amendments shall be considered in the following order: Nos 38, 1 to 37 and 39 to 123.
(3) Any further Message from the Lords may be considered forthwith without any Question being put.
(4) The proceedings on any further Message from the Lords shall (so far as not previously concluded) be brought to a conclusion one hour after their commencement.—(Damian Hinds.)
Question agreed to.
Consideration of Lords amendments.
I must draw the House’s attention to the fact that financial privilege is involved in Lords amendment 33. If the House agrees to the amendment, I shall ensure that the appropriate entry is made in the Journal.
TV licensing: alternatives to criminal sanctions
I beg to move, That this House disagrees with Lords amendment 38.
With this we may take Government amendments (a) and (b) in lieu.
I want briefly to outline why the Government have introduced amendments in lieu of Lords amendment 38.
A television licence is required to watch all live or nearly live broadcast television content on any device in the UK. People should not seek to evade this and there needs to be an effective enforcement regime for the failure to have a TV licence.
Clause 76 imposes a duty on the Secretary of State to ensure that a review of the TV licensing enforcement regime is carried out. This review will identify whether the current enforcement regime is appropriate and proportionate, and will ensure that there is a strong, evidence-based case for any changes to the TV licence enforcement regime. This matters a great deal to many people.
The Government are very clear that the review of the licensing enforcement regime is a high priority. The decision was taken to commence this review in advance of Royal Assent, while retaining the clause that commits the Government to carry out the review to ensure that this important piece of work is completed. The review is being led, independently, by David Perry QC. The findings of the review, which will complete by the end of June 2015, will be laid in both Houses of Parliament and be presented to the BBC Trust.
The proposed further amendment requires the Secretary of State within three months of the review reporting to set out whether the Government intend to decriminalise or not, and commits the Government to indicate clearly the timetable they plan to follow upon the completion of the Perry review. Our overriding aim is to ensure that the system is appropriate, proportionate and fair, and represents the best value.
This amendment places a firm commitment on the Government of the day to promptly and properly consider the report and set out their response and the timetable of steps to be taken, within three months of the report’s completion. Clause 77 confers a new power on the Secretary of State, via secondary legislation, to change the sanctions that apply to the failure to have a TV licence. We have always maintained that the report’s findings, and potential next steps, should be considered in the context of charter review. This position has not changed.
The BBC’s current charter expires on 31 December 2016. The Government will not begin charter review until after the election and there is no set process for how the review of the charter should be conducted, or when. It will be for the Government of the day to take forward any further actions as they see fit.
We must not make presumptions about the recommendations that Mr Perry will make, nor about how the Government will decide to take them forward, particularly as the public consultation element of this work is ongoing. Clearly, any changes will require serious consideration in the broader context of the charter review process, and it will be for the next Government to ensure that the right enforcement regime for licence fee payers, the courts and indeed the BBC itself is in place.
Our amendment ensures that the next Government will be ready and able to implement whatever recommendations David Perry, QC wishes to make, when the Secretary of State’s regulation-making power commences in April 2017. There was significant cross-party support for the TV licensing clauses during our earlier consideration of this Bill in this House. The firm commitments set out by the Government at that time must be honoured, particularly given that strong, cross-party support. Our amendments ensure that David Perry’s review will be promptly considered by the Government of the day, and that any potential changes are introduced to a clear timetable, leading up to 1 April 2017. For all the reasons I have outlined, I ask hon. Members to disagree with the Lords amendment and support our amendments in lieu.
Anybody would think, from the way the Minister just presented his case, that this has been a smooth path and everything the Government intended from the very beginning. But there was only an amendment relating to the licence fee at all because of a Government Back-Bencher, the hon. Member for North West Leicestershire (Andrew Bridgen)—who may be able to catch your eye a little later, Madam Deputy Speaker—and we have a change only because in the Lords the Government’s position was overturned by three votes. I am, of course, proud that we now have a far more sensible set of propositions before us. I admit that the Liberal Democrat heart that is still beating within the Minister is probably on our side in this argument, but he might at least have shown that that heart still beats, rather than just deliver what his paymasters in the Conservative party have told him to deliver.
The truth is that Labour Members support the BBC licence fee for the foreseeable future, not out of ideological passion but simply because it has worked and because the vast majority of people in this country support it. Everybody comes up with other ideas; every Select Committee that has ever examined this issue has set out this, that and the other idea for us to consider, but at the end has said that the least worst option is the licence fee. Broadly speaking, that is what the Select Committee on Culture, Media and Sport decided in its report a couple of weeks ago.
Will the hon. Gentleman give way?
Of course. I cannot think of anyone to whom I would want to give way more.
The lack of any other options on the Government Benches may have something to do with that. I hope that the hon. Gentleman does not mistake the broad support on the Government Benches for a different and less stringent sanctions regime for support for the TV licence. I very much support the idea of a TV licence, but we need somehow to rein back what has been allowed to happen with TV licence sanctions. That is what drives most of the support for this amendment.
I did not give way to the hon. Gentleman faute de mieux. He is right in what he says, and some Opposition Members are as passionate in their support for the licence fee as he is, as I am or as Tony Hall is but want a change to the rules on how the licence fee is administered and the penalties for those who do not pay. My noble Friend Baroness Corston put forward a cogent and moving argument, to which one would have to be hard-hearted not to listen, on the criminalisation aspects of the current situation. Our point, which won substantially in the House of Lords, was that we have a system that broadly works, and if we want to change it, it would be better to change it in the round, rather than simply changing the licence fee. Let me explain why.
The licence fee is not just about funding the BBC’s programming, although it is true that it provides £3.7 billion of investment in the arts, broadcasting and British culture through the BBC, which it is difficult to see how any other model would deliver to the same degree. In addition, it provides for a degree of competition for quality, as well as for audiences, with the other broadcasters. Thus, ITV wants to make high-quality drama and does so; many of the dramas people often associate with the BBC are actually made by ITV. Likewise, Channel 4 has a special role to play because of the original remit it was given to be edgy, alternative and sometimes naughty. It can perform that public service broadcasting role within the whole ecosystem only if the BBC licence fee also exists and if Channel 4 remains in public hands. I am sure that the Minister would agree with me on that one about Channel 4, even if some Conservative Members might not.
The Opposition believe that it is important that there is the licence fee, and that it is a massive investment in production and drama, not just the kind of long-form dramas that exist in American commercial broadcasting and are often very lucrative, but the short-form dramas, such as “The Casual Vacancy”, which has been on the BBC over the past few weeks. It was only three episodes long and it would be very difficult to make in any environment other than one where there is some form of subsidy. In news, current affairs, comedy and so many different areas, the BBC would not be able to perform the same function without the licence fee.
Labour Members have been critical of the difficult time the BBC has had. Of course it always has to strive to make its resources stretch further, but since 2010 it has had not only a tough financial settlement but top-slicing, with a significant amount of money—some hundreds of millions of pounds—going off to fund the roll-out of broadband around the country. In addition, S4C is, in the main, being paid for not by the Department for Culture, Media and Sport but out of the licence fee, and the World Service is being paid for not by the Foreign Office, but out of the licence fee.
I see that the hon. Gentleman is pregnant.
If the BBC has had such a tough financial settlement and it can no longer go on with a freeze on the licence fee, can the hon. Gentleman explain why the number of managers—not staff, but managers—who work for the BBC and are paid more than the Prime Minister has increased by 10% in the past 12 months?
Those are precisely the kinds of points the BBC has to address. It has to make sure that more and more of its money is spent on programming rather than on administration. That is why I congratulate the hon. Gentleman on one element of his campaign. He has argued forcefully that the collection system for the licence fee costs some £100 million a year and he has asked whether there is a better way of doing that. That is a perfectly legitimate question to ask.
Of course there are those—I see the hon. Member for Shipley (Philip Davies) has just entered the Chamber at precisely the right moment—who would dismantle the licence fee. He is the only member of the Select Committee who voted to get rid of the licence fee completely. Some people would want to change it, and that is a perfectly legitimate argument to have. My concern about how the Government behaved on this issue is that the version they sent through to the House of Lords meant that the Government could have instituted the decriminalisation of non-payment of the licence fee without consideration of that issue within the whole package of other issues relating to the BBC and charter renewal. In effect, that would have left the door open to dismantling the licence fee without even intending to do so. I am certain that, as right hon. and hon. Members said in the House of Lords, if the Government were to proceed too swiftly, we would simply see a significant fall in licence fee take-up almost immediately. We could be talking about something in the region of £200 million or £250 million, which is more than the cost of all children’s broadcasting.
We need to think carefully about the timing of how we proceed, which is why Labour supported in the House of Lords the amendment that the Government are objecting to today, but not really objecting to. They are doing an adroit about-turn, for which we are deeply grateful. I wish to praise my colleagues in the House of Lords, particularly Lord Stevenson of Balmacara and Baroness Hayter of Kentish Town, who made sure that the amendment was carried, with a lot of cross-Bench support and a significant amount of Liberal Democrat support.
I want to make it clear that our argument has always been that if we are going to decriminalise non-payment of the licence fee, for which there are strong arguments, we need to do it as part of a debate about the whole of charter renewal and the whole of the licence fee settlement for the next several years. Otherwise the danger is that if we proceed too fast with just one element, like pulling on a thread in a jumper, we will pull apart the whole jumper. We would have been perfectly happy with the original amendment. Although the Government would have the power to introduce regulations decriminalising the non-payment of the licence fee, they would not be able to do so until 1 April 2017 which, as the Minister pointed out, will be past the time when the new charter for the BBC will have been agreed and the licence fee will have been settled for a further period.
We would have been happy with that amendment, but the Government have introduced a face-saving amendment, which says:
“The Secretary of State must, before the end of the period of 3 months beginning with the date on which the review is completed, lay before both Houses of Parliament a report setting out the Secretary of State’s response to the review”.
We have no objection to the Government doing that. When we are the Government, we expect to do that. I note that the Minister expects that Mr Perry will have completed his review by June or perhaps July—sometimes these things slip. That means that by the end of this year, if the motion is agreed, a Labour Government will bring forward such a report.
The vast majority of hon. Members are not like the hon. Member for Shipley—an ideologue, passionate about destroying the BBC licence fee and, to my mind, destroying the BBC and surrendering our future to commercial broadcasting in its entirety. The vast majority of Members in this House, even Government Members, who have hearts beating as socialist hearts, even if they do not yet know it, believe in the licence fee. Although we all want to see an end to unnecessary criminalisation of non-payment, we want to make sure that the licence fee is considered in its entirety when that is done. Anything else—
I was on my very last sentence. Normally, hon. Members are clamouring for me to stop, but I see that the hon. and learned Member is clamouring for me to continue.
Does the hon. Gentleman agree that in principle it is wrong for somebody to be sent to prison for not paying the licence fee?
I believe in the licence fee. I would like to see decriminalisation. If we can achieve decriminalisation of non-payment of the licence fee in a way that does not dismantle the rest of the licence fee, yes, I would agree with the hon. and learned Gentleman. However, in order to do that, one cannot simply send forward to Her Majesty legislation which suggests that the Government can introduce that decriminalisation in a few weeks’ time. We have to carry the amendment as tabled, substantially agreeing with the House of Lords, while pretending to disagree. I am grateful that the hon. and learned Gentleman passionately agrees with me. He still has a beating socialist heart and will support the licence fee, as we shall.
I start by expressing my deep disappointment that the amendment has been added to the Bill by the House of Lords, by a narrow majority of only three noble Members, in order to maintain the status quo and perpetuate criminalisation of non-payment of the TV licence for at least another two years—an eleventh-hour attempt to frustrate the clear will of this House and of the country.
It should be noted that five of the votes in favour in the other place came from the ex-BBC chairman, Lord Grade, in whose name the amendment stood; the ex-BBC “Play School” presenter, Baroness Benjamin; an ex-BBC governor, Baroness Deech; the ex-BBC “EastEnders” actor, Lord Cashman; and BBC producer Viscount Colville. They all spoke in the debate and voted in favour of the amendment.
In referring to all those Members, the hon. Gentleman might also point out their slightly wider career paths. For example, Lord Grade was head of ITV and spent most of his career in broadcasting in the commercial sector, so it is fascinating that the commercial sector and the public sector agree.
Order. I do not think it is fascinating; we are not here to debate Members of the other place. We are here to debate the Lords amendments so, Mr Bridgen, I require you to desist from reminding us what happened in the other place, because we can read it, and to direct your comments to the amendments before us.
Thank you for that guidance, Madam Deputy Speaker. I much appreciate it. However, I point out to the House that those five noble Members represent more than the majority by which the amendment was carried in the other place.
Having read the Hansard record of the various speeches on the amendment in the upper House, as I am sure all hon. Members have, I found myself with a strong sense of déjà vu. There they were, all the same lines from the multimillion-pound BBC spin machine that we heard when I first proposed the amendment—horror stories about huge changes to the BBC if decriminalisation came in; losses of £200 million of revenue; the emotive closure of all local radio stations and TV stations; and so on. We have heard it all before. I remind hon. Members that there was support for my amendment from across the entire political spectrum in this House. It was signed by 149 right hon. and hon. Members and had the support of many in the Government who were unable to sign.
I draw the attention of the House to the comments of Baroness Corston, who was mentioned by the shadow Minister. She recognised the impact of delays to the implementation of the decriminalisation of non-payment of the TV licence. The longer that takes, the more people will go to prison and the more people will be criminalised. Every year of delay means that another 160,000 of our fellow citizens will be dragged up on criminal charges for non-payment of a £145.50 licence—in effect, a poll tax.
Baroness Corston said:
“I once met a woman who had been imprisoned for three months for failing to pay the £145.50 television licence fee and a £200 fine. If she could not afford the licence fee, surely she was not going to be able to afford a £200 fine as well. During those three months in prison she lost her tenancy and was unable to look after her children, who were taken into care. When she came out of prison, she was told that she could not have local authority accommodation for a family because she did not have her children with her, and when she went to social services she was told that she could not have her children back because she did not have family accommodation.”—[Official Report, House of Lords, 5 February 2014; Vol. 759, c. 800.]
That is truly shocking.
As I have previously stated in the House, around 50 people a year go to prison as a result of the legislation, a disproportionate number of whom are women—50%, whereas women make up only 4% of the prison population. However, speaker after speaker in the upper House, while noting the comments of Baroness Corston, decided that the spurious claims about a shortfall in BBC funding took precedence.
It is unfortunate that TV licensing enforcement in Scotland was not brought up in the debate in the other place. I would like to correct that and remind the House that the Criminal Proceedings etc. (Reform) (Scotland) Act 2007 introduced a regime whereby an emphasis was placed on alternatives to prosecution, such as fiscal fines. The result was a fall in prosecutions from nearly 2,000 in 2006-07 to just 34 in 2012-13—a 98% reduction. If the BBC PR machine is to be believed, one would think that that would result in a significant fall in compliance with the licence fee. However, as Fergus Reid, the spokesperson for TV Licensing in Scotland, said in 2013:
“the average evasion rate remains at a low of just over five per cent, meaning almost 95 per cent of homes are correctly licensed.”
Does my hon. Friend consider it disproportionate to imprison somebody for non-payment of a relatively small debt? Does he agree that this needs to be corrected, much as some of us love the licence fee?
Not only do the majority of Members of this House think that the measure is disproportionate; I honestly believe that the majority of people in the country think that it is disproportionate. When I first proposed my amendment and canvassed support for it across the House, it was clear that a large number of Members did not initially think that it was a criminal offence not to pay the TV licence fee. It is within our power to correct this. In England and Wales, more people are imprisoned each year for the non-payment of fines associated with TV licensing than are prosecuted for evasion in Scotland, with little, if any, difference in the evasion rate.
To be absolutely clear, people are not going to prison for refusing to pay the TV licence fee. The reality is that people are sent to prison for refusing to pay the penalty for not paying the fee in the first place. The former Solicitor-General has intervened a couple of times to suggest the opposite to that.
The hon. Gentleman is absolutely right. People go to prison not for not paying the licence fee, but for not paying the fines. However, if someone has hit hard times and has no money and cannot afford a £145.50 licence fee, they are unlikely, as in the example cited by Baroness Corston, to be able to pay a £200 fine, which could result in a mother going to prison and her children being taken into care, with the consequent results for her family on release.
The avoidance rate for payment of the TV licence fee in Scotland is hardly different from that in England, despite the fact that we criminalise 160,000 to 180,000 of our citizens a year and imprison between 30 and 50, whereas Scotland prosecutes only some 30 people a year. Given the sparsity of population in Scotland and human behaviour being what it is, one might consider that there would be a greater chance of evading prosecution in a remote part of Scotland than anywhere in England. I would suggest that there was possibly a higher evasion rate in Scotland prior to the decriminalisation anyway.
Unfortunately, the BBC public relations machine seems to have won the day in the upper House, so I now come to amendment (a) in lieu, tabled in the name of the Minister for Government Policy and Chancellor of the Duchy of Lancaster, my right hon. Friend the Member for West Dorset (Mr Letwin). As he says, there is no doubting the significant cross-party support for the clauses relating to TV licensing during the earlier stages of the Bill, and the firm commitments set out by the Government must be honoured. I therefore support the amendment to ensure that the review by David Perry QC, due in June 2015, to which I had the pleasure of giving evidence only last week, is promptly considered by the Government of the day, and that the changes that I very much hope come about are introduced with a clear timetable.
Whatever future funding mechanism for the BBC is decided at the next charter review, I hope that criminalising more than 160,000 of our fellow citizens each year, an estimated 75% of whom are women, will no longer be part of it. I therefore urge the House to join me in opposing the Lords amendment and supporting the Government’s amendments in lieu.
I will make a few short comments in relation to the points that have been made in the debate. It is impossible to win with the hon. Member for Rhondda (Chris Bryant). If we do not make any changes to the Bill, we are being dictatorial and steamrolling things through. If we do make changes in response to the debate, we are being spineless. As a Minister, I am always in favour of listening, and if there are ways of improving a Bill, that is what I like to do—and that is what we are doing today.
Does my right hon. Friend agree that the hon. Member for Rhondda (Chris Bryant) is the ideal Opposition spokesman? I hope he stays in opposition for a long time.
I certainly agree with my hon. Friend on that, and I am confident that the hon. Gentleman will stay on the Opposition Benches for a long time. However, I thank the hon. Gentleman for expressing his support in a roundabout way, and in a lengthier contribution than mine on this measure.
I thank my hon. Friend the Member for North West Leicestershire (Andrew Bridgen) for providing us with the opportunity to debate TV licensing and enforcement today, a debate he initiated many months ago. I hear the unhappiness that he has expressed, but I also heard him comment positively on the fact that there is a clear commitment from any future Government, providing the Bill is passed, to come forward within three months of the publication of the Perry review with an action plan setting out the steps that they will take if they are in favour of decriminalisation.
Lords amendment 38 disagreed to.
Government amendments (a) and (b) made in lieu of Lords amendment 38.
Health and safety at work: general duty of self-employed persons
I beg to move, That this House agrees with Lords amendment 1.
With this it will be convenient to discuss the following:
Lords amendments 2 to 17.
Lords amendment 18, and amendments (a) to (g) thereto.
Lords amendment 19, and amendments (b), (e), (c) and (d) thereto.
Lords amendment 20.
Lords amendment 21, and amendment (a) thereto.
Lords amendments 22 to 25.
Lords amendment 26, and amendments (a) and (b) thereto.
Lords amendment 27, and amendments (a) to (k) thereto.
Lords amendments 28 to 37 and 39 to 123.
It seems a long time since I was sitting opposite the hon. Member for Newcastle upon Tyne Central (Chi Onwurah) debating the Deregulation Bill, but we are back here today. The Government support Lords amendments 1 to 37 and 39 to 123. I will also be speaking to amendments tabled by hon. Members to Lords amendments 19, 21, 26 and 27, which the Government will not be supporting for reasons that I will set out shortly.
Lords amendments 1 and 2 relate to health and safety and the self-employed. Lords amendment 1 addresses concerns raised during the public consultation on draft regulations conducted by the Health and Safety Executive during July and August 2014. Concerns were expressed that the regulations as drafted could lead to some self-employed persons who do pose a risk to the health and safety of others falling exempt from the law. Amendment 1 sets out the ways in which undertakings may be described in regulations made under section 3(2) of the Health and Safety at Work etc. Act 1974 to retain duties on self-employed persons. Subsection (2A)(a) provided for regulations to include descriptions of activities carried out by an undertaking where the duty on the self-employed would remain in place, essentially providing for a list of high-risk activities. Importantly, subsection (2A)(b) ensures that the regulations can also include a general description covering any undertaking the conduct of which may expose others to risks to their health and safety. The amendment means that the provision in the Bill aligns more with Professor Ragnar Löfstedt’s recommendation. The HSE will produce guidance targeted at self-employed persons and others to assist with their understanding of the amendment.
Lords amendment 2 takes into account a recommendation of the Delegated Powers and Regulatory Reform Committee to change the parliamentary procedure for these regulations from negative to affirmative. This will allow Parliament fully to scrutinise the regulations.
Lords amendment 3 removes a measure that would have had the effect of allowing private hire vehicles to be used for leisure purposes when they were not being used for private hire purposes. After listening to concerns about this proposal during the Bill’s passage, the Government have decided that the best course of action is for this measure to be considered as part of the package of measures recommended by the Law Commission to reform taxi and private hire vehicle licensing.
Lords amendments 5 to 17 seek to provide clarification and certainty in relation to the tenancy deposit protection legislation in response to recent court cases. The amendments address two issues. First, they make it clear that, where appropriate, a letting agent’s contact details, instead of the landlord’s, may be provided to a tenant. That was always the intention of the original framework, and thus the measure has been made to apply retrospectively. However, to ensure fairness, provision is also being made to prevent the reopening of out-of-court settlements or court cases that had been finally determined on this basis.
The second issue, which was raised by the recent Court of Appeal judgment in Charalambous v. Ng 2014, concerns tenancy deposits. The Court ruled that the tenancy deposit legislation should apply to landlords who received a tenancy deposit before the coming into force of the tenancy deposit legislation in 2007, and that they would therefore need to protect deposits if they wished to rely on the “no fault” ground for eviction, known as section 21. This was never the Government’s intention. Our amendments therefore make it absolutely clear that, although landlords affected by the judgment will need to protect deposits if they wish to rely on section 21, they will not be at risk of financial penalty should they fail to do so.
Lords amendments 18 to 26 protect tenants in the private rented sector from being evicted where they have raised a legitimate complaint about the condition of their home, and make the eviction process more straightforward in appropriate cases. They also ensure that tenants are aware of their rights and responsibilities and those of the landlord. The hon. Member for Shipley (Philip Davies) has tabled amendments to these amendments, and I will come to those shortly. The effect of the Government’s amendments is that landlords in the private rented sector will not be able to evict a tenant merely because the tenant has asked them to carry out a repair, provided that the local authority has confirmed that such a repair is necessary to prevent a potential risk to the tenant’s health and safety. They ensure that tenants are always given at least two months’ notice before they have to move out of their home and make the eviction process more straightforward for landlords in situations where the tenant should be evicted.
The amendments enable the Secretary of State to make regulations specifying the information to be contained in any eviction notice served under section 21 of the Housing Act 1988, and provide that an eviction notice cannot be served where a landlord has failed to comply with their existing legal obligations relating to the condition of the property, the health and safety of their tenants, or the energy performance of the property. They also require landlords to provide information to their tenants about their rights and responsibilities.
As many Members will know, these amendments started as a private Member’s Bill in the name of my hon. Friend the Member for Brent Central (Sarah Teather), whom I thank for all her work in bringing this to the attention of the House. I also thank the Secretary of State for Business, Innovation and Skills; the Minister for Employment; and the Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Bristol West (Stephen Williams). Shelter and Citizens Advice have also been heavily involved in this process.
Retaliatory eviction is wrong, and its continued practice is unacceptable. No tenant should face eviction because they have made a legitimate complaint to the landlord about the condition of their home, and no decent landlord would engage in the practice. However, a small number of rogue and unscrupulous landlords think it is perfectly acceptable to evict a tenant for requesting a repair. These important amendments introduce protection for tenants against rogue and unscrupulous landlords, but they also contain provisions that will benefit landlords and make it more straightforward to evict tenants in legitimate circumstances.
On the amendments tabled by the hon. Member for Shipley, I understand the intention behind some of them. However, I assure him that Lords amendments 18 to 26 ensure that all landlords are still entitled to their rights under section 8 of the Housing Act 1988, which enables them to evict a tenant who does not pay rent, goes to prison, or uses the house for illegal purposes. Our fundamental aim is to prevent a very small minority of rogue landlords from evicting tenants in retaliation for raising a legitimate complaint. Part of his proposals would undermine this effort.
Will the Minister answer two questions? First, is the opposition to my amendments unanimous across the coalition, or is it just the Liberal Democrats who oppose them? Secondly, what estimate have the Government made of the number of revenge evictions that take place each year, because there is great discrepancy in the numbers?
On the number of revenge evictions, I will have to get back to the hon. Gentleman; I may get inspiration in the next few minutes. On whether there was coalition agreement on this issue, when the Department for Communities and Local Government looked at the impact of his amendments, it was clear that, in some cases, they would allow a landlord to make a retaliatory eviction on the day after the landlord had completed a repair. That would go completely against the intent of the provisions in terms of protecting tenants. It would permit a landlord to evict a tenant as soon as repairs had been completed using a section 21 eviction notice. That is not in the spirit of preventing retaliatory evictions, but merely delays them until after repairs are completed.
On the number of revenge evictions, as the hon. Gentleman will probably know, the figure is estimated to be some 80,000 per year. The source of that figure was a YouGov survey of 4,500 renters.
Even if the hon. Gentleman feels that the figure is rubbish and it is perhaps half that, 40,000 retaliatory evictions per year is still a very large number.
Why are the Government basing their figures on an opinion poll commissioned by a campaigning charity on this issue and ignoring their own figures from the English housing survey, which estimates that the number is about 6,000 a year?
I thank the hon. Gentleman for that helpful intervention. He thinks that the figure is lower, at 6,000 evictions. I said 80,000, and then generously halved it for him to 40,000. If it is indeed 6,000, then that is 6,000 retaliatory evictions too many. His amendments would facilitate the process of retaliatory evictions, which the Government are, instead, seeking to avoid.
The amendments would extend the time within which a landlord must respond to a request for a repair from 14 days to 20 working days. This Government believe that renting out a property is a business and that tenants should be able to expect a much swifter response to a complaint than 20 working days—in other words, a month—particularly where the problem is serious. To clarify, this time frame is only for responding to the concern raised, not fixing the problem. There is a further amendment to the effect that any complaint must be within the scope of the Landlord and Tenant Act 1985. However, that legislation is not the framework under which local authorities operate for the purposes of inspecting a property and deciding whether there is a health and safety risk to the tenant. Inspections are carried out under the Housing Act 2004 and involve checking for the presence of 29 potential hazards in the home.
Amendment 5 would remove protection against retaliatory eviction where a landlord intends to sell the property within six months. However, the proposed legislation already provides that it does not apply where, at the time when the section 21 eviction was served, the property was generally on the market for sale.
The next amendment would provide that protection against retaliatory eviction does not apply where a landlord wants to move into or redevelop the dwelling, or the dwelling is subject to a compulsory purchase order, or the landlord needs vacant possession to comply with a legal duty to carry out works in the building. Compulsory purchase orders are rarely used, but even where they are, the acquiring authority would become the landlord and could terminate the lease under separate powers.
The final amendment would introduce a five-year time limit on the life of the legislation or require that a review shall be commissioned within three years of the legislation coming into force. As the hon. Gentleman will be aware, it is standard practice to evaluate legislation after a certain period, and we will of course do this. However, we do not necessarily believe that the issue of retaliatory evictions will be resolved in five years, so we do not want to limit the powers as they stand.
Where a landlord wants to move back into a property that they are renting out, the legislation will not prevent them from doing so, provided that they follow the normal process and deal with any repairs before a local authority becomes involved. The legislation contains safeguards to ensure that a tenant cannot benefit from making spurious or unfounded complaints. A complaint in itself will not be enough to trigger protection against retaliatory eviction. In all cases, the local authority will have to confirm that a repair needs to be carried out and that failure to do so would probably involve a serious health and safety risk to the tenant. In addition, the legislation makes it clear that a tenant cannot claim protection against retaliatory eviction where they have failed to treat the property in a tenant-like manner—in other words, to take care of it, rather than to damage it wilfully and negligently—including by carrying out small jobs around the property.
I now turn to Lords amendments 27 to 30 on short-term lets and the amendments tabled by the Opposition to Lords amendment 27. The Lords amendments relate to the short-term use of residential premises in London as temporary sleeping accommodation. The Government intend to remove the uncertainty for London residents who wish to let their property on a short-term basis, perhaps while they are away on holiday or during events such as Wimbledon.
I hope to catch your eye later, Madame Deputy Speaker, but it is pretty clear that there is no uncertainty whatsoever. The regulations have been in place for 42 years for good reason, so to sweep them away as is now proposed would be rather unwise. I hope that the Minister will provide a little meat on the bones of exactly why the Government now wish to do so, particularly given the strength of feeling among London MPs on both sides of the House and in the Lords.
I will provide more explanation in a few minutes. I hope that it will satisfy my hon. Friend, but I suspect that it may not. We will have to wait and see. One point is that this is an issue only in London. I am not aware of a huge number of problems associated with it outside London. Perhaps there are such problems, but they certainly have not been drawn to my attention. The proposals will simply bring the approach in London into line with that in the rest of the country.
I did not quite follow the Minister’s argument. He accepted the fact that London is different and that there is strong feeling about it in London, but he proceeded to say that the Government therefore want to make London like the rest of the country. I am afraid that that is a non sequitur. If there is a problem in London, the Government must address it by accepting it and listening to the views of the local authorities and others in London who have clear experience of it and are saying that what the Government propose is wrong.
I do not know whether the right hon. Gentleman was paraphrasing me. What I should have said is that I am hearing the concerns about London expressed in this debate, but there are no restrictions of such a nature and I am not aware of its causing a significant issue outside London. I will come on to explain why the Government support the proposals and why we believe that the safeguards, which I am sure he wants, are sufficient to deal with any concerns of London MPs.
At present, Londoners would be in breach of section 25 of the Greater London Council (General Powers) Act 1974 were they to use their residential premises as temporary sleeping accommodation without planning permission, because the Act stipulates that letting a residential property for less than 90 consecutive nights is a material change of use and thus requires planning permission. Not obtaining such permission means risking a fine of £20,000.
The Government published a policy paper on the short-term use of residential property on 9 February. It takes into account the representations we received following the publication last year of the discussion document on property conditions in the private rented sector, as well as our discussions with London local authorities, the industry and Members of both Houses.
Following that, the Government tabled a number of amendments in the other place to update the existing legislation and ensure that we provide appropriate freedom for London residents, broadly in line with that enjoyed by residents across the rest of the country. Alongside the new freedoms, we have sought to provide important safeguards to prevent the abuse of the reforms and, crucially, to prevent any opportunity for commercial letting on an ongoing or permanent basis, about which I am sure Labour Members are concerned.
I, too, hope to catch your eye in this debate, Madam Deputy Speaker. The Minister is a London MP, so he knows the pressures on the residential housing stock in London. Have not London local authorities, across the parties, made representations to stress that fact? For example, Westminster alone loses about 500 residential units every year to short-term lettings, because it is impossible to distinguish, in the way the Minister claims to do, between the holiday let and the extension of what is effectively the hospitality industry.
The Government are clear that the proposals are not about facilitating a process that will allow more commercial letting on an ongoing or permanent basis; they are about restricting lets by individuals to a maximum of 90 days. I do not know whether the hon. Lady has ever used Airbnb or something of that nature in other parts of the country, where people let out their properties on a short-term basis at the time of particular events, such as the Liberal Democrat conference in Glasgow. There is no suggestion that people are letting out properties permanently. The Government do not want that to happen, which is why the restriction of 90 days has been put in place. I will come on to the other safeguards in a moment.
I will not intervene again, but may I ask about that particular point? The Minister is saying that there is not a problem, but Westminster alone has had to take 7,362 cases against quasi-commercial short-term lettings in the past 15 years even under the existing regulations. The key point is that such enforcement will be far harder when the Government relax the rules, as they intend to do.
The hon. Lady will hear what I have to say about enforcement notices, and she may want to pick that up among the points she will make should she catch your eye, Madam Deputy Speaker.
The internet has created new opportunities for residents who want to enter into what has become known as the sharing economy, a catch-all term encompassing all asset owners who wish to share their asset with others in exchange for a fee. As a result, it is now easier than ever for residents to rent out their property to supplement their incomes and offer consumers new experiences. A cursory look at some of the websites facilitating such lettings reveals that thousands of London properties and rooms are available for short-term use, all of which potentially violate the current section 25.
Lords amendments 27 to 30 add additional safeguards in relation to the short-term use of London properties without planning permission in three ways. First, they stipulate that a property can be used as temporary sleeping accommodation only for a maximum of 90 nights per calendar year. That will ensure that the reforms provide residents with greater flexibility, but it will not create opportunities for the short-term letting of properties on a permanent basis. Secondly, they provide that the person providing the temporary sleeping accommodation must be liable for council tax. That requirement means that a property is used as a residence, because a property used as a hotel or hostel would be liable for business rates. Combined with the 90-night per calendar year limit, we believe that this provides an appropriate safeguard against short-term letting on an ongoing or permanent basis. Thirdly, they allow either the Secretary of State or the relevant planning authority with the Secretary of State’s consent to direct, where there is a strong amenity case for doing so, that the relaxation of section 25 does not apply to certain properties in certain areas. I hope that addresses the hon. Lady’s concerns.
Let us try to dig a little into precisely how big that concession is. Would the Minister allow local authorities, particularly those in central London, to exempt themselves from the exemptions in the entirety of their area—in other words, to tie themselves again to the 1973 Act—or is he suggesting that the concession would apply only to very limited stress areas?
I am sure that my hon. Friend was listening carefully. I said that the Secretary of State would have to give consent. The Government are not proposing that local authorities should be allowed to decide unilaterally which areas are in and which are out. We want to facilitate something that is already clearly happening on a large scale in London—as far as I am aware, it happens elsewhere in the country without significant problems—to give individuals the flexibility to allow their properties to be rented on a short-term basis if there is an event, such as Wimbledon, during which they want to absent themselves.
The Minister mentions Wimbledon and I have no doubt that he is also thinking about things such as holiday lets. How many prosecutions have there been in respect of Wimbledon and holiday lets? The proposal is just about commercial lets. Is it not impossible to regulate such things in the way the Government intend? It is over-regulation to say that councils must apply for a waiver. Why does he not let localism take charge and allow local authorities decide for themselves?
Clearly there is a localism aspect to the proposal. If, as some Opposition Members are saying, there is a significant issue in Westminster and places like it, I am sure that Westminster city council will present a well-argued case to the Secretary of State to say why it believes that there should be an exemption in a particular location. I am sure that the Secretary of State would consider such an approach carefully.
The Government believe that the Lords amendments provide appropriate flexibility for Londoners alongside sufficient safeguards. The 90-night limit, coupled with the requirement for hosts to be liable for council tax, means that we will not create new opportunities for residential properties to be used as temporary sleeping accommodation on a permanent basis without planning permission. The relaxation of section 25 will allow properties to be used more efficiently when residents are away, and it should not remove properties from the housing stock that is available to Londoners and their families. In the Government’s opinion, the safeguards, coupled with the ability to exempt areas with the consent of the Secretary of State, are sufficient to protect Londoners against any potential abuse of the relaxation of section 25.
The Opposition amendments to Lords amendment 27 principally seek to create the additional condition that residential premises can be used as temporary sleeping accommodation without planning permission, provided that the premises are the principal residence in London of the owner. They would require the provider of temporary sleeping accommodation to notify the local planning authority in advance of every occasion on which they intended to use their property in this way on a short-term basis. I wonder whether any assessment has been made of the impact of that proposal on the existing London market, with regard to people who are already in breach of the law, and of the burden on local authorities in handing all the advance requests. The Opposition amendments would also remove the requirement for the local planning authority to seek the consent of the Secretary of State to direct that the new flexibility does not apply to particular residential premises or premises in particular areas.
The Government believe that the Opposition amendments seek to remedy issues that have already been addressed by the amendments the Government made in the other place. They would place additional burdens on London residents that are not experienced by residents in other parts of the country, and they run counter to the spirit of the legislation as a deregulatory Bill.
We know that short-term letting is already taking place in London, but the current legislation has led to confusion and uncertainty for potential hosts. The Government amendments will provide clarity and give London residents the confidence that they can use their property as temporary sleeping accommodation within the law, without the disproportionate bureaucracy of applying for planning permission. For those reasons, I ask the hon. Member for Newcastle upon Tyne Central not to press the Opposition amendments.
I will finish fairly soon, Madam Deputy Speaker, but I am afraid that the amendments touch on a wide range of issues. Lords amendments 31 and 32 change the parliamentary approval procedure for the establishment of urban development areas and urban development corporations. They contain a sunset provision with an expiry date of 31 March 2016. On expiry, the process to establish any further urban development areas and corporations will revert to the existing affirmative procedure. These amendments are intended to help us quickly to establish the urban development corporation for Ebbsfleet —a subject that was debated in the House recently.
Lords amendment 33 inserts new section 220A in the Housing Act 1996, which will give the Secretary of State the power to provide financial assistance when advice is provided in connection with the law concerning park homes. Financial assistance may be provided when an organisation provides information, training or advice, or a dispute resolution service concerning residential licences in England. Where appropriate, the money may be recovered from the recipient. There are similar powers to provide funding to organisations that provide legal advice on residential tenancies. The amendment simply provides the Secretary of State with a similar funding power in respect of residential licences.
Lords amendments 34 and 82 will enable and empower NHS ambulance services to respond to medical emergencies quickly and effectively. There are statutory provisions that exempt vehicles from various rules contained in road traffic legislation when they are being used by the emergency services for fire, police and ambulance purposes. However, modern practices and technology have outgrown the current law, which mainly uses the term “ambulance”. NHS ambulance services now use fast response units including cars and motorbikes to provide quick responses to the most critically ill patients, where time is of the essence. They also use larger vehicles to transport equipment to major incidents to ensure that clinicians are properly equipped. Such responses provide a vital part of NHS emergency health care.
The definition of “ambulance” and “ambulance purposes” in a recent case concerning the use of blue lights and sirens was limited to vehicles that have a primary use of conveying the sick and disabled, and did not include other vehicles such as motorbikes used by paramedics. That means that the fast response units that are used by NHS ambulance services to be the first on the scene of crises ranging from road traffic accidents to cardiac arrests, and that are therefore among the fastest travelling vehicles, can no longer rely on the exemptions. Lords amendments 34 and 82 will extend the stated exemptions to cover all fast response units that are dispatched by the national health service, whether they are vehicles that are owned or leased by an NHS ambulance service or private vehicles.
Lords amendments 35 to 37 will permit motor racing on closed public roads. Motor sport governing bodies in England and Wales, in conjunction with local authorities, will be able to authorise motor races on roads that are closed for the purpose. Certain traffic regulations, such as those on speed limits and traffic signs, may be disapplied while the road is closed. Motor racing on roads will also be permitted in Scotland as long as the event is authorised by regulation and held in accordance with any conditions that are imposed.
Lords amendments 41 to 43 and 109 will remove a restriction in the Administration of Justice Act 1985 and the Courts and Legal Services Act 1990 that affects the Council for Licensed Conveyancers. The CLC can authorise a body or person only if they are licensed to provide conveyancing services. None of the other legal services-approved regulators have that restriction.
Lords amendment 46 amends sections 56A, 57 and 65LA of the National Health Service Act 2006, which are concerned with the transfer of property liabilities and staff between NHS bodies. The changes simply clarify the provisions in the existing legislation to ensure that it can be used in a seamless and efficient way. They do not create new policy. The amendment is needed to remove the uncertainty over the operation of the powers of NHS foundation trusts to acquire another NHS foundation trust or NHS trust using section 56A, and to correct the omission of key powers with respect to the transfer of staff and criminal liabilities. It will also extend Monitor’s power to transfer the property and liabilities, including criminal liabilities, of an NHS foundation trust that is dissolved following special administration.
Using the procedure in section 56A is the only way in which an NHS foundation trust can acquire another foundation trust. However, section 56A is uncertain and open to interpretation. Although it sets out the process to be followed when an acquisition is contemplated, it does not set out its terms. Further, it does not explain what happens to the acquired trust property and liabilities, or to third-party rights and obligations. The uncertainty that that creates means that NHS foundation trusts are unlikely to utilise the current provision for fear of legal challenges. Correcting that position will have an impact on measures to secure financial and clinical sustainability within the NHS. It is essential that NHS foundation trusts have the confidence to use section 56A.
Lords amendment 46 will make it clear that Monitor’s granting of an application is conclusive proof that the property and liabilities of the acquired NHS trust or NHS foundation trust, including third-party property rights, are transferred to the acquiring foundation trust. Accordingly, subsection (3) of the new clause will insert new section 56AA in the 2006 Act to provide for a direct transfer of property and liabilities by operation of law. The grant of the application will be conclusive proof that the acquired trust is dissolved and, in the case of an acquired NHS trust, the establishment order revoked.
Very nearly finally, Lords amendments 47 and 48 will allow records to be available other than in the form of a certificate. Many family historians and genealogists do not need a certificate, but merely the information contained in it. Providing alternative formats will make it cheaper and quicker to obtain that information. The amendments would provide the power to lay regulations to define how a person may access birth, death, marriage and civil partnership records, the type of product that can be issued, and the fee payable. The regulations could also introduce a legal distinction regarding the age of birth, death, marriage and civil partnership records. That will follow the precedent set in Scotland and Northern Ireland where records are considered historical at 100, 75 and 50 years for births, marriages and deaths respectively.
Lords amendments 102 to 108 relate to sections 86 and 87 of the Apprenticeships, Skills, Children and Learning Act 2009. They make adjustments to the transfer of duties under those sections to secure the provision of facilities for education and training, so that those duties are appropriate to and recognise the wider remit and discretion of the Secretary of State. That is by contrast with the current wording, which was appropriate to the chief executive whose role as a creature of statute needed to be more closely specified.
Finally, Lords amendments 121 to 123 would remove further redundant pieces of legislation from the statute book. All other Lords amendments are either consequential on other amendments, or they are minor and technical in nature or seek to provide clarity. I urge the House to accept Lords amendments 1 to 37, and 39 to 123, and to reject the amendments to the Lords amendments.
Thank you, Minister. That was quite a few “Finallys.”
The Opposition welcome many of the Lords amendments. It has been an 18-month process to bring the Bill to this stage, and it has been much improved by the scrutiny brought to bear not only by my hon. Friend the Member for Newcastle upon Tyne Central (Chi Onwurah) and other hon. Members who had the pleasure of serving on the Bill Committee opposite the Minister, but in the other place where a great deal of cross-party and constructive work was done. This will not be a case study in how to make laws—much of it is ill considered and there has been a lack of consultation about many of the proposals—but it may in future become a case study for how Members of the House can work together despite the Government, and particularly with the support of Members in the other place, to make better law.
We welcome Lords amendments 1 and 2. The changes will certainly improve clause 1 although we still believe that it is unnecessary, ineffective and confusing. We have opposed the clause in all its guises from the very beginning. It is clear that this is an ideologically driven attack on health and safety and will have a negligible impact on the self-employed—those whom the Government say they will help. We think that the clause could create confusion where there has been clarity in the law for more than 40 years, and at no stage was any real evidence brought forward to support any of the proposed benefits of the changes.
We have heard how some small businesses and self-employed people may benefit, but that will clearly be at the cost of creating confusion for millions of self-employed people in a variety of sectors and in some dangerous occupations. That contributes to a narrative that health and safety is inherently a bad thing, rather than something that makes our economy more competitive and a safer place to work. I shall be part of work around the country led by the GMB and other trade unions—it is international workers memorial day in a few weeks’ time, and we will recognise the huge progress we have made in this country to keep people safe at work. I regret that the Government are now seeking to undermine that progress.
I will not repeat the lengthy arguments made by my hon. Friend the Member for Newcastle upon Tyne Central in Committee, or those made by Lord McKenzie of Luton in the other place, but I will say that this clause—and indeed the Bill as a whole—has benefited from scrutiny, even though we believe it is largely unnecessary. Concessions were won in the House of Lords and improvements made to the Bill generally without any support from the Liberal Democrats in either House. They argue that they are a moderating influence that improves the actions of the Government, but the Bill shows that they have failed in that respect.
Amendment 10 is a welcome U-turn from the Government on the proposal to let anyone behind the wheels of a minicab. For the past year Labour has opposed the Government’s proposals to reform minicab law because we believe that they will put passengers at risk. Taxi and private hire vehicle regulation is complex, and we recognise the arguments that it is outdated. Nevertheless, these reforms are not the right ones.
The regulation and licensing of types of vehicles and their drivers is undertaken by local authorities across England and Wales, except in London. In 2011 the Department for Transport requested that the Law Commission undertake a comprehensive review of taxi and minicab law, aiming to modernise and simplify it. The Government delayed the publication of the Law Commission’s report, and instead proposed three amendments to the Bill on minicab regulation in March 2013, seeking to meet the so-called red tape challenge to scrap legislation. The informal consultation that the Government claimed to have carried out was not public but apparently sent privately by a civil servant to a limited number of select bodies who were given just 10 days to respond on such an important issue. That inadequate consultation process was strongly criticised by those involved and—more importantly—all those who were not involved, including local authorities and safety campaigners. No impact assessment for the reforms has ever been produced.
In May 2013 after the local elections the Government allowed the Law Commission to publish its proposals for reform, which included a new national framework of safety and standards enforced at local level. Many organisations, including the National Private Hire Association, Unite, the National Association of Licensing and Enforcement Officers, the National Taxi Association, the Institute of Licensing Officers and the Local Government Association stated that the Government’s proposals would undermine the Law Commission’s reforms, result in further complications in the law rather than less red tape, and put passengers at risk.
The most controversial proposal was to enable people who do not hold a private hire vehicle licence to drive one when it is “off duty”. Safety campaigners, including the Suzy Lamplugh Trust, Rape Crisis and Women’s Aid, police and crime commissioners of all parties, and councillors, joined Labour to warn that the measure threatened to increase the number of unlicensed drivers pretending to be legitimate, as enforcement against the illegal use of licensed vehicles will be almost impossible. The provision also threatens to put vulnerable people such as women and young girls at increased risk from rogue taxi and minicab drivers.
The Government eventually produced a form of impact assessment—although clearly it was not compelling to hon. Friends in either House—on 1 October 2014. It was signed by Baroness Kramer and confirmed that letting anyone drive a minicab
“could lead to an increase in illegal use of licensed vehicles.”
In respect of private hire vehicles and taxis the Bill has been a complete mess. We are pleased that the Government U-turned on the proposal and that today they have finally dropped it.
Like safety campaigners, the National Union of Students and others, we are still concerned about clauses 10 and 11. Clause 10 will end mandatory annual licensing checks, enabling minicab operators to subcontract bookings to firms in other areas, which I think is worrying. Some 80% of women polled by the LGA said that they would be concerned if they booked a journey with one firm and another company turned up. I completely understand that.
The alternative is that when the vulnerable women the hon. Gentleman refers to call a taxi firm, if it is not able to subcontract the fare it will simply say “We cannot take your job”. Is that better?
The taxi and private hire vehicle marketplace is increasingly competitive, and users of those vehicles are well used to looking—usually on a smartphone or some other device—for another company to use. Firms often recommend other firms and companies, which provides some assurance to someone who has booked a taxi—[Interruption.] The Minister should listen because it is a shame that having dropped some of the proposals he is not listening to the concerns of safety campaigners. Eight out of 10 women surveyed said that they would not feel safe getting into a taxi from a company that they had not booked or contacted. I completely understand that and am surprised that the Minister cannot.
Will the hon. Gentleman give way again?
The Minister did speak for 38 minutes, but I will give way.
I also took some interventions. Will the hon. Gentleman clarify whether all those private hire companies are licensed and subject to security vetting?
The Opposition think it is important that local authorities take seriously their responsibility to license private hire vehicles, and we are not seeking to undermine the existing framework that provides assurance to people who are booking taxis and private hire companies, as clauses 10 and 11 will.
Safety concerns have been raised considerably since the inquiry into child sexual exploitation in Rotherham, which concluded that one of the common threads running through child sexual exploitation across England has been the prominent role of taxi drivers in being linked to children who were abused. The author of the report, Alexis Jay OBE, has warned against any further deregulation in that area. Given that the Government accepted the recommendations of that inquiry, we are surprised that the Minister has not listened to the concerns that are out there.
The Home Secretary has promised a joined-up safeguarding approach in response to Rotherham, and we have now heard about cases elsewhere in the country, including the disturbing report that came out last week about Oxfordshire. How do these proposals, particularly those in clauses 10 and 11, relate to that promise to join up safeguarding? I want to quote an old friend of mine and a very respected figure in local government, Councillor Ann Lucas, the chair of the Local Government Association’s Safer and Stronger Communities Board. She has campaigned to keep women and girls safe from violence, and she has stated:
“Keeping children safe is our top priority and a responsibility councils take extremely seriously. It is imperative that the Government withdraws these plans so councils can continue to fully check everyone getting behind the wheel of a taxi or private hire vehicle to ensure vulnerable children are kept as safe as possible.”
We are pleased to see the back of this provision today, but we are disappointed that the Government have not fully listened to the concerns that have been raised.
I want to turn now to the amendments relating to housing. This is why I have been asked to respond to the debate today. I pay tribute to the work that has been done on the Bill by my hon. Friend the Member for Newcastle upon Tyne Central. It is these amendments that have provoked particular interest. We have already heard concern being expressed about short-term lets. The issue has generated considerable controversy since it was proposed that there should be some relaxation of the London provisions, but the Government have also focused attention on what is now happening in the market and why the status quo cannot be sustained. Currently, the letting of residential accommodation for temporary sleeping accommodation in London for a period of less than 90 consecutive nights constitutes a change of use, for which planning permission is required. Notwithstanding the possibility of a fine of up to £20,000 for failure to secure permission, short-term letting is extensively carried on without permission being available or given.
We have covered in earlier debates the problems that can arise in this area, and the issue is also dealt with in the very welcome briefing that we have received from London Councils, which has done excellent work to highlight the fact that this is a particular issue for London. The loss of residential accommodation to the lucrative short-let market has an impact on the availability of accommodation in central London, which is already under pressure. Properties entering the short-let market in this way can increase problems of noise and antisocial behaviour, as well as leading to a loss of community identity, increased crime and fire safety risks and significant challenges relating to continual enforcement.
We know that other cities around the world are experiencing similar problems, so why are cities such as Amsterdam and Berlin taking action in this area while our Government fail to recognise the importance of the issue for this part of our country? Westminster city council estimates that at least 3,000 properties in the borough are being used for short-term letting accommodation, and there has apparently been a rise of 37% in just three months in Camden. Members should recognise that these are very real problems that afflict some areas particularly deeply. The issue has been raised not only by the Opposition; I know that some Government Members wish to comment on it as well, as it affects all parts of London.
There is clearly a market for short-term letting activity, and business opportunities have been created, particularly via the internet. It was noted in the other place that this is very different from the situation in the 1970s. According to the Government’s own figures, thousands of London properties and rooms are currently being advertised for short-term lets, each of which is potentially in breach of the law. That is an untenable situation. Of course we support people who want to rent out their home when they go on holiday or want to make a bit of extra money. We understand that some people want to take the opportunity to do that. However, any changes in the provisions must ensure that there is a clear distinction between those who wish to rent out their homes infrequently and those who want to turn them into a short-let business. There is a critical difference between them.
We are worried about the lack of consultation on these proposals, and the results from the recent survey undertaken by London Councils show that the move is not really what many London local authorities want. They are the organisations closest to the issue, and 93% of the boroughs opposed the Government’s proposals to remove the requirement for planning permission for short-term lettings in London, 83% of them would not support the Government’s proposals even if the boroughs were able to apply exemptions in specified premises or areas, and 71% of them believed that the removal of the requirement for planning permission would have a negative impact on the London economy as a whole.
The Government released their policy document on short-term lets prior to the Report stage in the Lords. It set out their vision of how they would operate. The document stated that a short-term let may not exceed 90 days in a calendar year, that such a let may apply to a property only where the owner is liable to pay council tax, and that the local planning authority and the Secretary of State for Communities and Local Government should be able to issue a direction to exempt a particular area or premises. Unless our amendments are accepted, however, it will not be a question of the local authority and the Secretary of State being able to do that. Rather, it will simply be conditional on the Secretary of State giving his support. There is no localism involved at the moment. This is another example of the Secretary of State wanting to meddle in a decision that should rightly be determined at local level.
In the other place, Lord McKenzie of Luton won the support of Baroness Hanham, Baroness Gardner of Parkes and Lord Tope to come up with a package of measures that, building on the Government amendments, would enable home owners who wished to let their homes on a short- term basis to do so unless there was detriment to the amenity of the locality, and to do so within a system in which there was proper notification to local authorities and in which enforcement was enabled. The Minister’s argument that such an arrangement would be burdensome shows that he does not really understand that, in this day and age, technology is a great enabler.
Local authorities should rightly take the lead on these matters, rather than the Secretary of State, and they are particularly concerned about this. We have heard the evidence from London Councils. I am sure that they can be relied on to enable people to report the fact that they are letting their home on a short-term basis in a way that will not prove too costly, not least because many of the London boroughs in question have had some of the biggest council cuts in England under this Government.
Our amendments cover four areas. First, there must be provision in regulations for those letting properties on a short-term basis to have an obligation to notify the local authority. That is not a prescriptive amendment. Secondly, the concept is that short-term letting should be allowed when it involves someone’s home. It appears that the Government are seeking to define that by a liability to council tax, but we think that that is inadequate. Would not a liability to council tax arise for somebody letting residential property on a commercial basis—for example, between tenancies? Limiting the relaxation to someone’s principal residence in London would better target the deregulations. That is the reason for our amendment on that point.
Thirdly, we welcome the provision that the Government are seeking to make for local authorities to disapply the regulation for certain properties or areas, but we oppose this right being subject to the consent of the Secretary of State. As I have said, the Government’s proposal is not a localist move. Finally, there is the issue of enforcement, and we believe that a proportionate system can and should be put in place. The amendments are designed not to undermine the Government’s position but to strengthen the safeguards, and I hope that, even at the eleventh hour, the Government will be able to support them.
I have three short “finallys”, Madam Deputy Speaker. On tenancy deposits, Labour pushed for these amendments in the House of Lords and we are therefore delighted that the Government have seen sense and tabled their amendment, which implements Labour’s proposals. On Ebbsfleet, as we made clear in the other place, we remain unconvinced that the negative procedure accompanied by a statutory duty to consult is the appropriate procedure for establishing an urban development corporation. I was personally involved as a local councillor in north Kent in the late 1990s and the early 2000s when we were trying to get Ebbsfleet off the ground, having successfully brought Bluewater to the area to help with the regeneration, and I greatly regret that it has taken the Government so long to take these proposals forward. They have effectively wasted five years. We do not intend to stand in their way on this technical question of how UDCs should be created.
We welcome the Government’s change of heart on tackling retaliatory eviction. They had previously suggested that our amendment to the Consumer Rights Bill in the House of Lords to protect tenants against retaliatory eviction was unnecessary. We believe that it was absolutely necessary, however, whether it would affect 6,000, 40,000 or 80,000 people. These amendments give much needed protection to tenants, as landlords will no longer be able to evict them in response to a valid complaint about their home. Tenants will no longer have to choose between living in poor conditions or losing their home. Labour would go much further to get a fairer deal for private renters by legislating for three-year tenancies, by ending excessive rent increases by putting a ceiling on rent increases across the three-year tenancy and, crucially, by banning rip-off letting agents’ fees for tenants. Nevertheless, we are happy to support the Government’s proposals today. I urge the Minister, at the final stage of this 18-month process, to listen to the many hon. Members who have direct personal experience of the issue of short lets, and to have a change of heart.
Sensible, pragmatic regulations exempting the Greater London area from a short-lets free-for-all are, as we know, under acute threat. I appreciate that the Minister has to put his ministerial duties at the forefront today, but he will know that his mentor, the noble Lord Tope, was one of the leading lights in the House of Lords in trying to get a more sensible and pragmatic approach to the issue. I hope that even at this 11th hour we can have some comfort on an issue about which a number of London MPs on both sides of the House feel strongly.
It is recognised that our capital city is a place of particular hyper-mobility and hyper-diversity, where housing shortage is a perennial long-term problem. That lies at the heart of the regulations, which have now been in place for more than four decades. Unquestionably, the world has changed since 1973, but the big new idea behind the so-called sharing economy is being vigorously promoted through ferocious lobbying by commercial interests whose business model requires the sweeping away of these long-standing public interest safeguards.
The creation of a new trade body, the so-called Sharing Economy UK, is essentially a front for that commercial campaign. Frankly, it is akin to setting up a trade body of payday lenders to dictate financial services policy. I am sorry that the wool is being pulled over the Minister’s eyes as these self-professed independent voices dictate a commercially advantageous landscape. Meanwhile, scant regard is being paid to the interests of residents, particularly in central London. If this was really all about allowing home owners to undertake short-term holiday housing swaps, as the Government suggest, it is highly unlikely that a local authority would even be aware of such a brief arrangement and no enforcement action should be taken against the owner in such instances, as it would clearly be disproportionate.
Enforcement action in the City of Westminster is, at least, reserved for those situations in which the council becomes aware that properties are being let on a short-term basis all year round. The number of such properties is significant, as the hon. Member for Westminster North (Ms Buck) pointed out, and the impact of this activity is hugely detrimental in our locality, leading to a diminution of housing stock, reduced security, increased antisocial behaviour, a breakdown in community cohesion and giving a green light to what can, at its worst, be fraudulent activity. Without the current safeguards, many social housing properties, for instance, are likely to be sub-let given how lucrative the short-stay market can become in central London.
I have spoken in the House about all these concerns before as the Bill has gently wended its way towards the statute book, so I shall not go into the specific detail again. However, I want to raise two further issues. First, flats in blocks in which short-term letting is taking place might find that the insurance policy of the entire building becomes invalid. Secondly, and most worryingly in many ways given the geopolitical problems we face, which are particularly acute here in London, national security concerns have been raised by the Metropolitan police about the absence of checks on those who can live in central London for up to 90 days a year through short-term lets. That is three months in which people can come and reside in London completely under the security radar. The provisions contain no prior notification process, so local authorities would be literally clueless about who was letting their property on a short-term basis and for how long.
Of course, a question was asked on this subject in another place to which we did not get a proper answer, so I will ask it again of the Minister. We have been told by the Metropolitan police that they rely heavily on article 5 of the Immigration (Hotel Records) Order 1972, both in proactive intelligence-led activity and in retrospective investigations, but that that power would be superseded by unchecked short-term letting. What assurances or safeguards have the Government sought from the police and Home Office that the legislation will not inadvertently create a grey area that can be exploited?
I fear that this will all end in tears, and I regret that. Even at this late stage I ask the Government carefully to assess the impact the changes to short lets will have and to consider some more robust safeguards. At the very least, I want to see owners having to notify the local authority of a short let and its length. Councils believe that they can set up an online notification system pretty easily, but that without such a system controlling short-term lets would be utterly impossible. I would also ask that the premises concerned must be the principal London residence of the owner offering the let. More importantly still, councils should also be able to request that the Government provide local exemptions to the provisions when there is a strong amenity case for doing so. I know that proposals were made in the other place and I regret that more thought has not been given to that practical safeguard. I hope that the Minister will give some thought to it, even at this late stage.
I should also like a provision that states that the total period of short lets in any one calendar year for a specific property should be no more than 30 days, as that should be sufficient for a bona fide residential property owner seeking the flexibility that many of us would like in this so-called sharing economy.
If the Government are unwilling to see sense, I hope that at the very least we will get an assurance today that if the effects of the operation of these changes over the next 12 months prove to be as detrimental to the permanent resident population as many in central London fear, the Minister will review the situation with some urgency. I regret that it has come to this, because some practical discussions have taken place and one would have hoped that amendments would be made in the other place. The Government appear to have been wowed by the whole idea of a sharing economy in developing many of the provisions, many of which I wholly support, and that has meant that this has become a Christmas tree of a Bill, particularly as regards short lets. It has been suggested that we can simply throw out with the bathwater something that has worked for the past 40 years. I speak with less knowledge and authority than many on the Opposition Benches, but perhaps our housing problems, concerns and constraints in this capital city are more acute today than they have ever been in the past four decades. In many ways, if we had not already had the 1973 order, we would perhaps be looking to impose it today, rather than enacting this deregulatory measure.
I hope that the Minister will pay serious attention not just to what I have said but, more importantly, to what we will hear later in this debate and to the contributions made in the other place by members of all political parties. As a London MP, he will know that these problems are becoming increasingly acute. Carshalton and Wallington is a very different place today from 20, let alone 40, years ago. Short-term lets will be a much bigger issue for him in the years to come if we do not have some safeguards along the lines I have suggested.
I, too, rise to speak strongly in support of amendments (a) to (k) to Lords amendment 27, tabled by my hon. Friends on the Front Bench, and to reinforce the message we have just heard from the hon. Member for Cities of London and Westminster (Mark Field). I concur with every word.
I shall be relatively brief, because we have rehearsed these arguments on Report. I was also able to have a debate in Westminster Hall on exactly the same subject, and of course there were debates in the other place. However, let me reinforce a few points. The central point is that the spirit behind the amendments represents cross-party consensus in inner London. Obviously, we are now seeing cross-party consensus from the representatives of the London borough of Westminster, but the local authorities that have responded to the Government’s consultation include Haringey, Enfield, Camden, Westminster, Newham, Redbridge, Lambeth and the City of London, which all opposed the proposal. I know that hon. Members and peers with support from other local authorities have also spoken in favour of strong safeguards.
Those local authorities, their representatives and Members of Parliament from all parties feel a clear sense of the loss of protection for residential communities that this deregulation will involve. It is critical that a good Government should respond to the needs of localism and understand that central London in particular, like rural communities and the seaside towns, has distinctive needs and requirements that must be protected. We are arguing today that there are pockets in communities in central London in particular—and no doubt in other areas, such as the constituency of my right hon. Friend the Member for Greenwich and Woolwich (Mr Raynsford)—where the pressure from the commercial letting sector is becoming so intense that it is seriously impairing the quality of life of a number of residents.
As the hon. Member for Cities of London and Westminster has said, we are concerned about the loss of residential stock. Westminster city council has produced very strong evidence to support its argument. It has dealt with more than 7,000 enforcement cases so far and it is very important to stress that those are not enforcements against people letting out a room in their home for Wimbledon fortnight. If those were the types of enforcements taking place, the Minister would be able to point to evidence of an innocent homeowner being enforced and fined for a casual holiday letting, but the Minister is not able to do that because I do not think for a second that that is what local authorities are doing.
What we are seeing is the sustained movement of the commercial letting sector into residential communities. Westminster city council estimates that about 500 units of accommodation a year are lost to the housing supply. In fact, it has so far lost the equivalent of about seven years’ worth of its target housing supply at a time of acute housing shortage. It has also produced evidence that demonstrates that the kinds of rents that are being charged for properties ranging from rooms to whole houses are so much more than the going rate for a shorthold private tenancy, let alone that for a social letting, that it would not be sensible financially for a homeowner not to get into the sector. If we look at the websites advertising those short-term lets, we will see that variance for ourselves. Westminster city council last did a sustained piece of work on this issue a few years ago—I suspect that the outcome would be far starker today—and it found an average difference of 273% between short-term let rents and longer-term rentals.
The irony of Westminster city council making representations on the impact of market rents and the loss of affordable housing units is not entirely lost on me. None the less, I am happy to get together with it on the critical issue of the loss of residential housing stock, which must be addressed. The Minister has previously spoken in the same debates as me and professed concern about affordable housing and the housing supply in London. I do not understand why the Government are turning their face against the cross-party consensus that the hospitality industry is, in effect, leaching into the residential housing stock in London.
The hon. Member for Cities of London and Westminster and I have also previously raised the issue of the impact on residents. I will not rehearse all the arguments, but last summer I conducted a survey of people’s perceptions of the impact of short lets on Maida Vale, Bayswater, Queensway, north Marylebone and parts of St John’s Wood, which are the front-line areas. There were a litany of concerns and complaints about the lack of security in residential blocks with a high level of short-term lets, the impossibility of knowing who is coming and going, and serious problems of management.
Short-term visitors tend, not necessarily through any fault of their own, to treat their accommodation like hotels, but hotels spend a lot of money on looking after their properties whereas that is not necessarily the case with short lets. There are reports of damage to security systems, much greater wear and tear on communal areas and a higher level of anti-social behaviour. That is not necessarily because the people are themselves anti-social, but they come to London to enjoy themselves and to party and have a good time, so there is more rubbish and noise nuisance.
That is having a negative impact on those neighbours who in some cases find themselves stranded in residential blocks that are now almost entirely turned over to short let; it is also a cost to the public purse. Local authorities have to spend a considerable amount of time and effort enforcing against antisocial behaviour and higher levels of rubbish and noise nuisance. One of the Westminster wards has had to spend its budget on additional enforcement officers at a time when the local authority has cut more than £500,000 from its children’s services budget—that happened only last week—and plans to, in effect, halve its youth service. I know what I would rather spend public money on. I do not want it spent on chasing the hospitality industry for nuisance in a residential block; I would rather spend it on protecting our children and youth services. The impact on residential communities is a real problem.
That is all happening: as I have said, there have been more than 7,000 enforcements. Local authorities are having to chase a moving target as it is. The Government’s relaxation of the rules will make that significantly worse. At the moment, the local authority simply has to prove, should it choose to do so, that the property is being let on a short-term let basis without permission. In future, it will have to demonstrate that the property has been let for more than 90 days without permission, which will be a far harder thing for it to do. We have already seen—Camden, I think, is the council that has monitored this most closely—an explosion of lettings on the main websites since the Government announced their intention to deregulate. That is no accident and we can expect it to happen elsewhere.
We need to make it possible for local authorities to act to enforce. Personally, I would like the length of time for which someone can let out their home to be reduced significantly to 30 days, which would be reasonable in London. I certainly support the argument that the property should be the principal residence of the person who is letting it. Above all, I strongly feel that local authorities should have a right to be notified when such lettings take place. It is only through notification that a local authority will be able to enforce action.
Fundamentally, this comes down to the right of a local authority to determine what is in the best interests of its own community. We do not need to worry about whether London local authorities are concerned with boosting the tourism industry or economic growth: they are very much concerned with them, but they know very well that a balance has to be struck between those agendas and the protection of the people who live in London and their amenity and access to housing. Westminster city council—which, I repeat, is not known for failing to advocate a deregulatory agenda—is at the forefront of making that case, with which I totally agree.
Even at this last hurdle, if the Government support the measures proposed by my colleagues on the Labour Front Bench to allow local authorities to have the right to determine what is in the interests of their own communities, that would be very strongly welcomed by all parties in local government and in this Chamber, and the many thousands of people who live in the residential neighbourhoods most affected in London would breathe an enormous sigh of relief.
I begin by drawing the House’s attention to my entry in the Register of Members’ Financial Interests. As I have previously made clear in these debates, I am a tenant in two properties: my home in Shipley and where I stay when I am working in Parliament. I am also the landlord of one other property that I rent out. I therefore like to think that I have a good perspective on these matters and I want to see a situation in which we reward good landlords and good tenants. That is the basis for my amendments to Lords amendment 18.
In the interests of time, Madam Deputy Speaker, and in order to be helpful, I intend to speak only to my amendments, because other Members have already ably put forward their cases on the others. From what I have heard, the shadow Minister might want to press one of his amendments to a Division, so I will not seek to divide the House on mine, in order to protect time for Members across the House and facilitate debate. I am being as helpful as you know I always am on these occasions, Madam Deputy Speaker.
Order. Before you proceed, Mr Davies, let me say that that is extremely helpful and that I am very grateful. Given that the debate must end at 4.46 pm, it gives us a better idea of how to proceed. Thank you.
I am grateful, Madam Deputy Speaker. It is a shame that the debate clashes with the first day of the Cheltenham festival, but that is a hardship we shall have to bear. Anyone who has their doubles and trebles might like to know that Ruby Walsh and Willy Mullins have won three of the first four races today.
I am still bemused at the fact that we are dealing with a last-minute amendment on retaliatory eviction in what is supposed to be a deregulation Bill. The Minister said earlier that he would not accept an amendment because it went against the spirit of a deregulation Bill, yet here he is promoting a new regulation. I am struggling to understand how Lords amendment 18 has anything to do with deregulation. My amendments certainly try to keep to the spirit of the Bill by reducing some of the over-regulatory interventions that the Lords amendment would bring about.
It was no accident that I was so keen to scrutinise the earlier incarnation of these changes in the Tenancies (Reform) Bill, which was brought forward by the hon. Member for Brent Central (Sarah Teather). I am glad that I did, because its provisions were wide-ranging and, as far as I could see, were an attempt to deal with a problem—there was no evidence that it was as widespread as she claimed it to be—by inadvertently penalising good, normal landlords at the expense of bad tenants. In fact, not only was there no evidence to suggest that there was a big problem, but there was evidence showing that it was a very small problem.
Some people would love us to buy into the illusion that all landlords are bad and all tenants are good. There might be good and bad landlords, but the truth is that there are also good and bad tenants, and we should not forget that. There are already grey areas of law over these matters. John Midgley, to whom I pay tribute, is the enfranchisement and property litigation partner at Seddons solicitors. He acts for landlords and tenants alike and has been helpful to me in talking through some of these issues. One of his concerns is that these proposals could yet again have unintended consequences. In fact, the principle of an amendment that I tabled to this Bill at an earlier stage was accepted by the Government after the superstrike case, where the courts had ruled in a way that was contrary to what many thought were the real intentions of the original legislation. The clarification was required because the legislation was not clear enough and all the eventualities had not been covered sufficiently.
Through these amendments and what is said in this debate we have a chance to make Parliament’s intentions clear. We can then avoid the need for this regulation to be revisited simply because it is not clear enough that the intention is not to penalise good landlords. I am grateful that the Minister, from what I could tell, was keen to say that the purpose of these Lords amendments, as far as the Government were concerned, and the basis on which they would accept them, was that good landlords would not be penalised.
Let met turn to the detail of my amendments. I was rather disappointed when the Minister highlighted how little he knew about retaliatory eviction, because he seemed to be drawing numbers from thin air for the number of such evictions. When the hon. Member for Brent Central introduced her Bill, she did so on the basis that there were 200,000 such evictions a year. We then got into a bidding war with a Lib Dem peer saying that the legislation was vital because there were 300,000 such evictions each year. Now the Government say that as far as they are concerned there are 80,000. People are just making up numbers willy-nilly.
Fortunately, the evidence is all there in the English housing survey, which shows why people are evicted from their properties. It makes it abundantly clear that 81% of tenants leave of their own free will, 10% go by mutual agreement and just 7% are asked to leave by the landlord. Of that 7%, 57% are asked to leave because the landlord wants to sell the property, 10% because of non-payment of rent and 35% for other reasons. I went to the people who conducted the survey to ask what those other reasons were—I do not suppose anybody else bothered—and I was told that the numbers were too small to be broken down further, but they included: difficulties with the payment of housing benefit; landlords being dissatisfied with how the accommodation was being looked after; landlords receiving complaints from neighbours; and—this was the last one—tenants complaining to the landlord about problems with the property. Even if we take all the other reasons, 6,000 is the maximum possible number of evictions there could be and it is perfectly clear from the English housing survey that the figure is much lower than that. We are told that the provisions are absolutely essential because there are 200,000 cases a year, but that is not so. At most, there are a few thousand.
I am not defending any landlord who acts in an irresponsible manner and tries to kick out tenants simply because they have complained about their accommodation. I would never defend that; that is unjustifiable. However, we should at least have on the record the true scale of the problem, rather than numbers people have invented. If people want to act on the basis of the actual numbers, let them make their case—I have no problem with that—but please let us not have people justifying action based on fantasy numbers they have just plucked out of thin air, and the Government going along with it. That is not the basis for legislating in this House, and it is rather disappointing that the Government have resorted to using what they must know, in their heart of hearts, are bogus figures.
The whole point of this provision is to deal with the very small numbers of people who are evicted because they asked for a repair to be done. Surely, therefore, the emphasis of the legislation should be on getting the repair done. Currently, it is possible to evict tenants because they have asked for a repair to be done. The amendment from the other place seems to take an almighty sledgehammer to crack a tiny nut. It says that the landlord will not be able to evict a tenant for six months following the issue of a relevant notice. That is clearly completely over the top and it messes dangerously with the concept of no-fault evictions. We are talking about six-month tenancies here, and to give the tenant the equivalent of a whole free tenancy, even though the repair may have been dealt with, is crazy. Why not five months? Why not four months? Why not seven months? The landlord may already have been unable to issue a notice for some time at that point, meaning that they would not have been able to evict for that period, however long that was, plus the six months referred to here and the two-months’ notice period. That is an absolute minimum of eight months.
To those who say that the Lords amendment is to protect tenants from being evicted as soon as the repair has been carried out, I would say this. First, it is hardly likely that landlords, for no good reason, would spend the money to carry out a repair at their own expense and then evict a rent-paying tenant, with all the associated costs and risks that that would entail. That would be crazy.
Secondly, let us remember that a tenancy is a contract and must work both ways. In law, when tenants want to leave the property after the agreed time, they just leave. In theory, they pay their last month’s rent, hand over the keys, get their deposit back, or part of it, and walk away. They abide by the terms of the lease for the notice period and then they are free to go. In fact, even if they do not pay their rent, they often just leave and it is then up to the landlord to decide what, if anything, to do to try to recover the money owed to them. They do not need to give a reason for leaving or to justify it to anyone, and nor should they. However, according to the English housing survey, 80% of private renters who moved in the past three years said they had moved because they wanted to move, so most people are walking away when they have chosen to do so.
Thirdly, there could a situation where two things happen completely coincidentally. I do not believe that the Bill has considered this genuine possibility carefully enough. I will come on to my grave concerns about this later, but I will say for now that it is perfectly possible that shortly after a tenant raises a repairing issue, a landlord genuinely needs to get their property back. If the two Lords amendments relating to this issue are accepted, it would limit any additional damage caused in such cases by lifting the random six-month bar on the service of a section 21 notice.
Fourthly, the proposal would create a perverse situation whereby a landlord who deals with the problem is treated just as badly as a landlord who does nothing until the eleventh hour, presumably after much inconvenience to the tenant. I do not see the logic of penalising both and disincentivising a good landlord from carrying out what we would expect from a good landlord.
For those reasons, I do not believe that the law needs changing. As it happens, that was the view of the previous Labour Government when they considered this matter. I think that was perfectly reasonable. That has been the view of every previous Government. It was the view of the Communities and Local Government Committee, with a Labour chairman, when it looked at this issue. It recommended against making any changes to the law on this area, so it is not as if I am a lone ranger on this; the opinion I am arguing for today has always been the consensus opinion.
My amendments are a compromise between those keen to do something about a problem that apparently exists and the kind of gesture politics that will actually damage the condition of rental properties and the market generally. Under my amendments, as soon as the repair has been completed, the landlord and tenant would be in the position they would have been in but for the repair issue. In other words, the landlord could give the tenant two months’ notice to leave under section 21, as they could have done had no repair been needed, which seems to be what we are trying to achieve. Currently, the landlord could fail to make the repairs and evict the tenant. Under my proposal, they would have to make the repair so that the tenant could live in the property with the repair completed, and if the landlord then chose to give two months’ notice, the tenant would get the benefit of the repair in the meantime. I see no justification for the Lords amendment, and I had hoped that my compromise amendment would be substituted, but clearly the Government have decided against it, based on what the Minister said earlier, although we did not have much of an explanation why.
My amendment (c) would change “14 days” to “20 working days”. Under Lords amendment 18, the landlord has 14 days to respond to the tenant’s initial complaint. Given that under the Bill a failure to do so will have significant legal implications, it seems to me that 14 days is a rather short period, bearing the fact in mind that people are entitled to holidays and could be ill—if somebody went on holiday for two weeks, they would be completely snookered under the Lords amendment. Also, I am told that the proposal does not match up with the pre-action protocol on disrepair claims under the civil procedure rules. If there is already a good legal precedent for the time scale of 20 working days, it seems more reasonable and practical than 14 days and should be the benchmark, rather than a random number of days.
On amendments (d) and (f), the Residential Landlords Association, which I have been in touch with, is rightly concerned that the Bill does not provide for a moratorium preventing a local authority from taking action. A local authority can still serve a statutory notice on the landlord, even if the landlord is dealing with the complaint responsibly, as the law asks them to do. It points out that the Bill has consequences for such a landlord. The solution would be the addition of the provision that so long as the landlord replies in time and in an adequate way, the local authority is precluded from serving a statutory notice, unless the landlord fails to carry out the work on time, subject to an extension of time for good reason. That is what my amendments seek to achieve.
I tabled amendment (e), to leave out subsection (5), because it seemed odd to have a proposal for dealing with retaliatory eviction even where the tenant did not communicate with the landlord about the repair issue. Surely it can only be a retaliatory eviction if the landlord evicted a tenant knowing there was a problem. Under subsection (5), the provisions can be applied even if the landlord did not know there was a repair issue. How on earth that qualifies as a retaliatory eviction the Lord only knows. Under the Lords amendment, a tenant can rely on the retaliatory eviction provisions even if they have been unable to contact the landlord. If the tenant is paying their rent, they will have at least one means of contacting the landlord—through paying their rent—so I believe that this strange proviso should be removed.
Similarly, amendment (g) concerns the condition of the dwelling house, as it is called in the Lords amendment. As with the previous point, there is no explanation of what is meant by “condition of the dwelling house” when a tenant initially writes to the landlord. The Government might say that that is dealt with where the Lords amendment mentions the tenant’s making a complaint to the “relevant local housing authority” about the same, or substantially the same, subject matter as the complaint to the landlord. I point this out merely to ensure there can be no misunderstandings and that the condition of the dwelling house cannot, for example, include a broken light bulb or the like. We should all be clear that the intention of the Bill is that it refers to a relatively serious problem that needs fixing, not to the fact that a light bulb has gone and nobody has gone round to fix it, enabling the tenant to abuse the Bill for some trivial purpose. As things stand and as the legislation is written, there is no real defence for the landlord. I hope that the Minister will at least make clear in the words he uses what the intention behind this legislation is, should a court case come along, and confirm that it is not intended for the trivial matters that I have described.
Amendments (b), (e), (c) and (d) to Lords amendment 19 make provision for the landlord to be protected from the retaliatory eviction provisions if the house is for sale. I shall come on to that in a minute, but there are other glaring omissions along similar lines. The most important one is where the landlord wants the property back to live in. According to the English housing survey, only 7% of private renters who had moved in the last three years said that their tenancy had ended because they had been asked to leave by the landlord. Just short of six out of 10 landlords in that 7% category wanted their property back either to sell it or use it, so it is important that we get this part right. In my opinion, this amounts to a huge omission.
In one case I came across, a woman had rented out her property in the UK because she had gone abroad with her partner. The relationship broke up and she needed to come back to her home in the UK to live in—a perfectly reasonable position to be in. It is her property, so she should be able to do that. As drafted, however, the Lords amendments would make it very difficult for her to live in her own home for an awfully long period if she needs it back. Some thought should be given in the legislation to such circumstances, which are more common that many people might think, as the English housing survey showed.
There may be circumstances where the landlord wants or even needs to redevelop the property, which might not be possible with a tenant living in it. There may be a compulsory purchase order or a legal duty to complete works, which cannot be done with a tenant in place. Surely, it cannot be right for a landlord to be in breach of other legislation because of unfair restrictions in this legislation, which presumably cannot have been intended.
If the Government will not accept my amendments, can the Minister at least confirm the position in respect of breaching other legislation? Why should people not be able to get their own homes back to live in themselves if they need to? It would be very helpful if the Minister explained that.
I appreciate that I am racing through my amendments, Madam Deputy Speaker, but I am trying to give others the opportunity to get their points across and then to have a Division. Under my amendment (e), retaliatory eviction would not apply in certain conditions. It would depend on the tenant acting in “a tenant-like manner”, on not using the house for “immoral or illegal purposes” and on the absence of any
“indictable offence committed in, or in the locality of, the dwelling-house”.
Another condition is whether the tenant is in prison at the time. I think much of the amendment is self-explanatory, and I like to think that Members will see its obvious merits.
For some reason—I am not sure why, so perhaps the Minister could have a better stab at explaining it—what seem obvious and common-sense amendments dealing with omissions are not going to being accepted. If a tenant has used a property for criminal purposes, it must be right that they are not afforded any additional legal protections to stay there. Surely that is common sense. Equally, if a tenant is in prison at the time of making a complaint about the property, they should surely not be able to benefit from these Lords amendments.
This is a completely unacceptable way to pass wide-ranging legislation—on the basis of Lords amendments to legislation that has had no previous scrutiny in this place. We barely have any time to scrutinise it, and this is when mistakes happen in legislation. That is what happening today, as this is being rushed through in an unsatisfactory manner.
If the tenant has refused access to the landlord, for example, to prevent them from seeing any problems or from doing any repairs, it could hardly be right for the tenant then to benefit from the retaliatory eviction provisions. Nothing in the Lords amendments will deal with that, unless my amendments are accepted. If tenants do not allow the landlord to fix the problem, it should not be possible to protect them from eviction.
On rent arrears, my amendment would provide an effective way to separate good tenants from bad and ensure that good tenants are rewarded, while bad tenants are not allowed to abuse the system. If the rent is not paid, the landlord may well not be able to afford to carry out the necessary repairs. It would be very unfair to penalise a landlord by allowing a non-paying tenant to remain in the property for a further eight months—the extra six months that have been randomly provided, along with the two-month notice period. Indeed, it would be an absolute travesty.
Last year, when we were debating the Tenancies (Reform) Bill—on which these amendments are based—I was contacted by a landlord in my constituency, who wrote:
“I have been a renting landlord for over 30 years with a small portfolio and in that time have served 2 section 21s to tenants. One was a young delinquent male and his parents were involved and were understanding.
The other was a woman who was a long term tenant in a rented house and with whom I had had difficulties for several years collecting rent. When she left eventually there was a CC”—
“judgement against her for £6,000 arrears. The reason I am elaborating is that in my negotiations with her and her representatives the fabric of the building was brought into the discussions. Her grievances were not justified but if the proposals suggested had been in force I would have had even more difficulty getting my property back and she may still have been there. I would have had to spend money to deal with the claims she had levied and there would be no guarantee or obligation for her to settle the arrears going forwards. I would have been in a terrible situation.
There does not need to be a change to the current legislation, the section 21 is needed just as it is.”
Amendment (c) would insert in Lords amendment 19 the words
“or where the landlord intends to sell the dwelling house within six months.”
As I have said, when a property is for sale, the landlord is still able to serve a valid section 21 notice. There are myriad exclusions, for reasons that are beyond me, but I shall leave that aside for now. However, the landlord may not be able to put the property on the market until it is tenant-free. The change that I propose would prevent a tenant from making a complaint simply to prevent the property from being sold. I might add that past Governments have always accepted that that is a legitimate reason for the serving of a section 21 notice.
The landlord may not have been aware of the position at the time of the original complaint, but the Lords amendment would prevent him from subsequently selling the dwelling or removing the tenant. That strikes me as a total Catch-22 for landlords, which must surely be an unintended consequence of the legislation as it is currently proposed.
Amendment (d) would insert the words
“at the time the section 21 notice is given the landlord’s reasons for serving the notice are unrelated to the repairing issue.”
As I said earlier, I have grave concerns about what will happen if a landlord genuinely needs his property back and the tenant has, by sheer coincidence, made a complaint about a repair. It seems to me to be only fair to exempt landlords who have a genuine reason and to prevent them from being caught up in this nightmare legislation. Their need for the property to be returned could well have nothing to do with any kind of revenge or retaliation, but they will be caught up in the legislation regardless.
If, by sheer coincidence, the tenant of the woman whom I mentioned earlier, who went abroad and had to return to this country—the tenant had been dealing with managing agents—had given notice of a problem, that woman would not have been able to move back into her property for six months, and, presumably, for a further two months after that. Given that she would be the one moving back at the end of that eight-month period, it could be assumed that she probably wanted the repairs to be carried out. Far from having an interest in not carrying them out, she would have an interest in carrying them out, because she was going to live in the property. Surely, landlords should be protected in circumstances in which they will live in their properties themselves. They clearly will not want to live in a property that is not in a fit state. The Lords amendment would make un upsetting situation even more stressful.
There could also be a problem if someone wanted to move back into a property to be near an ill or dying relative and help with that person’s care. Surely, no one wants to pass legislation that would prevent that from happening. It would be helpful if the Minister made it clear that that is not the intention and that, if there are any claims in the courts, they can take that in consideration when dealing with what is currently very unsatisfactory legislation.
I turn to amendments 21 and 26. On amendment (a) to Lords amendment 21, the proposed burden placed on all landlords, good or bad, is that they are prevented from serving notice under section 21 for the first four months of the tenancy. This could have implications if the landlords then are unable to serve notice on exactly the first day of the fifth month, as they will lose out. Therefore, this amendment reduces that period to two months as a compromise. That would give landlords two months to get their notice in and get their property back after the six months, if that was what they needed, and make things a bit fairer. It also prevents the tenants from having a free four-month period in which to make a repairing complaint when the landlord can do nothing about it—something that, again, seems to be treating landlords as guilty until proven innocent.
My final amendments are amendments (a) and (b) to Lords amendment 26. I believe we have far too much legislation already, so I was pleased to see the Deregulation Bill announced, but as the Government are now using it to introduce more regulation, I am not quite as happy as I was when it was introduced. I suppose that is what happens when we have Liberal Democrats in government, however: a deregulation Bill becomes an extra regulation Bill.
For the reasons I have stated, I believe that it is healthy to have either a sunset clause or, at the very least, a review of this so-called necessary legislation to see what the real effects have been—to see whether any of the fears I am outlining have come to fruition. It would be helpful if the Government agreed that some kind of review will take place, certainly given the unsatisfactory way this extra regulation is being introduced at the last minute. Anyone who is confident that these laws will work well should have nothing to fear from a review. It would give me at least some confidence that the Government have some confidence in their own legislation if they agree to review it to make sure everything is fine.
There is always a danger with such legislation that the more of it there is, the more work will end up in the hands of lawyers and judges trying to deal with the fallout from it. The serving of notices can already be a highly litigious area. I understand there is much case law on the subject of the issuing of notices and this is where the doubt is on the side of the landlord and the side of the tenant.
I am surprised that we are here again today discussing this issue at this stage, as it has been considered on many occasions, and even the Communities and Local Government Committee concluded by saying:
“We are not convinced, however, that a legislative approach is the best or even an effective solution. Changing the law to limit the issuing of section 21 notices might be counter-productive and stunt the market.”
That all-party group—a Select Committee—looked into this in detail and came up with that unanimous conclusion. Yet here we are today completely ignoring all of that wise counsel and having just that kind of interference.
I believe the measures before the House today would tilt the scales unfairly against the landlord, which, as I have said, could easily put people off renting, so there could be fewer houses to rent. We should not just keep putting up an additional legal hurdle and saying that it is not that big a deal and assuming that everyone will jump it no matter how small the steps are and how much higher we keep building it. There are only so many hurdles people will be prepared to jump and even accomplished hurdlers like Colin Jackson might feel like giving up if they see the size of the hurdles that the Government are putting in the way of landlords.
I believe that my amendments are more in tune with the spirit of the Deregulation Bill than those proposed by the Lords. I hope that the Minister will think again about these matters, or at least clarify what the Government’s intentions are with this legislation on the points I have raised and agree to the review, which if he has any confidence in the Bill, he will be happy to do.
Given the excellent speeches we have already heard on this subject from my hon. Friend the Member for Corby (Andy Sawford), the hon. Member for Cities of London and Westminster (Mark Field) and my hon. Friend the Member for Westminster North (Ms Buck), I can be relatively brief on amendments (a) to (k) to Lords amendment 27.
The question that arises here is cui bono—for whose benefit are these changes being made? Who do the Government think benefit from allowing, in effect, unrestrained short letting in London? There is no mechanism for ensuring that these are not permanent short lets that go beyond 90 days, which, in itself, is too long. It is certainly not residents who benefit, nor is it residents wishing to do so-called Wimbledon or short holiday lets; it is large commercial organisations, some of which have been set up specifically to exploit this potential loophole—companies such as Airbnb and big commercial landlords.
Let me illustrate that, exemplifying why our proposals go a substantial way towards addressing the problem, by reading from parts of an e-mail I received just last month from a constituent. It said:
“I write to you as a concerned citizen. A whole part of a whole mansion block in your constituency near Ravenscourt Park underground station has been unlawfully converted into a hotel. I know this to be certain as I pass the building daily on my way to work and see many people with suitcases who, when I ask them if they need any help, usually respond that they have stayed or are staying 1/2/3 nights in an apartment in the building. Additionally, I couldn’t find that any planning permission had been granted in to allow these residential apartments or the building itself to be short let from the Hammersmith and Fulham planning database.”
The constituent then provides four links to websites that are advertising these apartments, which sound very attractive. He continues: