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House of Commons Hansard
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Written Statements
20 March 2015
Volume 594

Written Statements

Friday 20 March 2015

Business, Innovation and Skills

Prompt Payment Practices and Policies

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Tackling late payment is at the heart of our drive to help small businesses. Standing at £41.5 billion, late payment remains a significant problem for the UK economy. Small businesses shoulder the vast majority of this burden. The Government are absolutely clear that large companies should lead by example in paying their suppliers promptly and fairly, with 30 day terms the norm and 60 days the maximum. We need to improve corporate culture to drive home the message that it is not right to pay small suppliers late or to use unfair payment terms.

I am therefore delighted to be able to announce today the Government’s plans for implementing clause 3 (Companies: Duty to Publish Report on Payment Practices) of the Small Business, Enterprise and Employment Bill.

These plans are subject to the will of Parliament. Given the importance of these proposals I believe it imperative to give those affected as much notice as possible to prepare for their future obligations.

Large companies will be required to report on their payment practices and policies from April 2016. We are therefore developing the secondary legislation, IT systems and guidance needed to give effect to them. The Government intend to lay secondary regulations early in the next Parliament.

In November 2014 I published a consultation paper, draft secondary regulations and accompanying pre-consultation stage impact assessment on detailed proposals for obliging large companies to publish detailed information about their payment practices and performance. This sought views in particular on: which companies should be obliged to report; the information they should be required to provide; the frequency and location of reporting; and the penalties for breaches of the reporting obligation. The consultation closed on 2 February 2015.

On 2 March 2015 the Government published a summary of responses. This summarised the views expressed by 59 respondents—primarily business representative bodies, trade organisations and professional bodies. I am grateful to all who responded, and look forward to continued dialogue and engagement as we develop and implement our proposals.

The majority of responses agreed with the Government’s proposals that the reporting duty should be mandated for large organisations—large private companies, large LLPs and all quoted companies. There was support for relying on Companies Act definitions to determine the threshold of “large”. Having considered the views of the Regulatory Policy Committee, which queried the original proposal for extending the requirement to small and medium quoted companies, I can now confirm that duty will only cover large quoted companies. This better meets the policy’s aim of highlighting and changing the payment practices of large organisations.

Having considered the views of respondents and arguments put forward during Parliamentary debates, we have concluded that large organisations should be required to report on the following narrative and metrics:

standard payment terms, including any changes to these in the last reporting period. We will provide guidance to further clarify the expectations of companies in circumstances where they have different standard terms for different kinds of products;

average time taken to pay;

proportion of invoices paid beyond agreed terms;

proportion of invoices paid in 30 days or less; paid between 31-60 days; and paid beyond 60 days. The Government will, however, not require reporting on the proportion of payments between 61-120 days and beyond 120 days, because we are clear that all payments beyond 60 days represent bad practice. This is why we have recently introduced a maximum 60 day payment term in the voluntary Prompt Payment Code;

amount of late payment interest owed and paid;

whether financial incentives were required to join or remain on supplier lists;

dispute resolution processes;

the availability of: e-invoicing; supply chain finance; preferred supplier lists

membership of a Payment Code

We will also consider whether to mandate reporting on other payment practices, such as reverse-fixed payments. At present, the Government are not minded to do so.

An indicative format for the report is attached.

Most respondents to the consultation argued that the Government’s original proposal for quarterly reporting was overly burdensome. The Government will consequently require reporting on a half-yearly basis, thereby striking a proportionate balance between reduced reporting obligations whilst still ensuring up-to-date data. To ensure high levels of transparency and comparability, large organisations will need to provide this in open data format to a single central digital location. The Government will work with stakeholders in the coming months to design and implement a system that is as business—and user-friendly as possible.

These proposals will allow organisations with good payment records to highlight and celebrate their payment performance, whilst raising public awareness and scrutiny of poorer payers. This has the potential to cause a fundamental shift in the payment performance of the UK’s large organisations. I look forward to working with businesses in the coming months to make this a reality, and tackle the UK’s late payment practices once and for all.

It is also available online at: http://www.parliament/writtenstatements.

[HCWS428]

Pay and Work Rights (ACAS Helplines)

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Advice and guidance services currently provided by the Pay and Work Rights Helpline will transfer to Acas from 1 April. The Acas Helpline will, in addition to their usual services, answer queries on:

The National Minimum Wage

Working for an employment agency

Working hours, rest breaks and holidays

Agricultural workers’ rights

Working for a gangmaster.

The new arrangement will allow for a “one-stop shop” service for employers and employees who will be able to contact Acas for free and confidential advice on all employment rights and workplace issues.

Acas advice can be accessed either online: www.acas.org.uk/helplineonline or by phone on 0300 123 1100 between 8 am to 8 pm Mondays to Fridays and 9 am to 1 pm on Saturdays. This number costs the same to call as geographic 01/02 numbers, even from a mobile phone. It is included in callers’ free minutes on their landline and mobile tariffs. The current Pay and Work Rights Helpline is a 0800 number, which costs between 7p and 40p per minute for callers from a mobile phone. As the majority of calls to the Pay and Work Rights Helpline are from mobiles, the new arrangement is likely to be cheaper overall for users.

Having spoken to an Acas adviser, if an individual or third party wishes to make a complaint, Acas will transfer their call to the relevant Government enforcement body. Individuals and third parties will continue to be able to complain directly online to the relevant Government enforcement body as follows:

HM Revenue and Customs (HMRC)—about the National Minimum Wage

Employment Agency Standards inspectorate—about employment agency legislation (except Agency Worker Regulations)

Gangmasters Licensing Authority (GLA)—about agency workers in agriculture, horticulture, shellfish gathering or associated processing and packaging

Health and Safety Executive (HSE)—about working time issues, including maximum weekly working hours

DEFRA—about agricultural wages

Customers who ring the current Pay and Work Rights Helpline number from 1 April will receive an automated message advising them to ring the Acas Helpline. This automated message will be in place for at least the next 12 months.

More information on the above can also be found on www.gov.uk.

[HCWS433]

Communities and Local Government

European Regional Development Fund

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I wish to inform the House today of the launch of the €3.6 billion (approximately £2.9 billion) England European Regional Development Fund Operational Programme for 2014-20.

From 20 March 2015, applicants will be able to apply for funding to invest in projects that support innovation and boost businesses across local economies in England. This is on the basis of progress my Department has made in agreeing the major points of principle with the European Commission about the European Regional Development Fund Operational Programme.

By launching the programme and project calls on 20 March, local teams will be able to begin assessing applications. This will mean that we will be able to sign funding agreements as soon as the Operational Programme has been formally adopted by the European Commission, which we anticipate happening in June.

Decentralising funding to local economic areas

The 2014-2020 European Regional Development Fund Operational Programme is the most locally-led that we have ever had in England. We have abolished unelected regional quangos that were previously in charge of the schemes and given an important role to local enterprise partnerships and other local partners to shape and influence how the money is spent.

We also believe local partners should have a direct role in decision-making outside of a formally delegated arrangement, to further increase local engagement. The European Commission ruled this ou,t however, as not being compliant with European Union regulations. We have nevertheless ensured a strong local role for partners, whose advice will be pivotal in determining the priorities of project calls and the funding decisions that are taken—ensuring that projects are focused on the interests of local communities. We are committed to reviewing partnership arrangements in 12 months’ time and will effect changes as necessary.

Accordingly, the Operational Programme is built on the priorities of England’s 39 local enterprise partnership areas, and all funding decisions will be taken within this framework; local needs are therefore embedded into the programme and the funding decisions that will follow.

As a result, the Operational Programme is made up of the following funding priorities:

strengthening research, technological development and innovation,

improving access to, and use and quality of information and communications technology,

increasing the competitiveness of small and medium sized enterprises,

supporting the shift towards a low carbon economy in all sectors,

supporting climate change adaptation, risk prevention and management,

preserving and protecting the environment and promoting resource efficiency,

encouraging sustainable transport and removing bottlenecks in key network infrastructures in Cornwall and the Isles of Scilly,

technical assistance.

To ensure that local areas can fully exploit the range of European programmes that are available for the 2014-20 period, the European Regional Development Fund, the European Social Fund and part of the European Agricultural Fund for rural development are being combined in England into a single local growth package. This will be called the “European Structural and Investment Funds Growth Programme”. Local areas will benefit from combined allocations that support this approach.

Navigating the European Union bureaucracy

The programme has to operate within the rigid rules set by the European Commission. There are significant financial risks involved in running what are highly complex and bureaucratic European programmes. These can carry large financial penalties for which the Government—and therefore UK taxpayers—always remains financially liable.

That is why the Government have completely overhauled the way in which European Regional Development Fund programmes have been managed in England. Previously, the schemes were poorly overseen by the Government Offices for the Regions (2000-06 programme) and the Regional Development Agencies (2007-13 programme). The coalition Government inherited in 2010 a situation facing hundreds of millions of pounds of liabilities for breaches of the complex rules.

We have tackled this and sorted out £236 million of financial liabilities which we took on in 2010, and are on track to completely close the 2000-06 programmes with a dramatically reduced financial liability. In addition, all programmes in 2007-13 are maintained through an enhanced, disciplined and effective management process to minimise potential liabilities.

Ensuring value for taxpayers money

Every euro cent received from European funding schemes is UK taxpayers’ money. The European Regional Development Fund is a circular programme. UK taxpayers’ money is given to the European Union budget. Under the fund, a local project receives a contract, spends money and then claims from DCLG. DCLG then claims funds back from the European Commission. The whole process goes through a complex auditing process involving DCLG auditors and then European Union auditors. There is a debate to be had about the involvement of the United Kingdom’s future involvement with these types of structural funds. There is a strong argument that it would be better if structural funds were repatriated—and the United Kingdom had its money back, cutting out the middle man of the European Commission.

Turning to the 2014-20 programme, we think it is important that the role of UK taxpayers in funding these programmes is clear to all. That is why projects which are funded with Government money will be branded with the UK Government logo.

Spending public funds wisely is central to our Government’s approach in getting maximum value for money for the taxpayer. Reflecting the changes we have made to DCLG grant agreements, as I outlined in my statement of 23 February 2015, Official Report, HCWS292, we are also inserting new provisions into the funding agreements to stop taxpayer-funded lobbying with these European funds.

The Institute of Economic Affairs which has undertaken detailed research into the widespread and unhealthy practice of taxpayer-funded lobbying and so-called “sock puppets”. Their analysis has also identified the spending of millions of taxpayers’ money on the ‘European project’—Euro funds going to groups to promote ever closer European integration, bigger EU budgets and more EU regulation. This is not a good use of public funds.

Our funding guidance now states: “The following costs are not eligible expenditure: Payments that support activity intended to influence or attempt to influence the UK Parliament, Government, political parties, European Union Institutions, or inappropriately attempting to influence the awarding or renewal of contracts and grants, or attempting to influence legislative or regulatory action in the United Kingdom or the European Union.” Nothing in this prevents third party institutions from campaigning with their own private funds for whatever causes they want, but they should not do it with taxpayers’ money.

The myth of “free money” from Europe

My Department also oversees a number of “European Territorial Co-operation” (or, INTERREG) programmes. In the past, these programmes have suffered due to poor management and investing money in unsuitable projects which have not been consistently focussed on economic growth. My Department will ensure that 2014-20 programmes invest money much more efficiently.

Under the last Administration, funds were wasted on vanity projects for artificial pan-national Euro regions, such as the “Transmanche”. Pointless expenditure included a series of Cross-Channel Cycle Lanes, films on European fairy tales, a Cross-Channel Circus, a human treadmill, transnational dance troupes and an Atlas which renamed the English Channel as “Le Pond”.

Some parts of the public and voluntary sector have viewed European funding as “free money”, and not applied the same financial discipline that would apply to the direct spending of UK Government funding. Yet, there is no “free” money from the European Union: there is only UK taxpayers’ money. Indeed, the UK is even more of a net loser given the massive amount spent on bureaucracy, complex auditing and projects that would never have been funded by the UK Government directly. We have therefore sought to ensure that the 2014-20 schemes focus on jobs and growth, as well as tackling genuine maritime-related issues such as coastal flooding.

I will shortly be writing to partners to outline our robust approach in defending the interests of UK taxpayers with regard to INTERREG programmes.

[HCWS440]

Housing Update

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I would like to update hon. Members on the some of the recent actions that the coalition Government are undertaking on housing.

Providing more housing for older people

I would like to update hon. Members on recent measures the Government have taken to encourage the development of more housing for older people. We are committed to addressing the challenge of our ageing population. The Government are working to help older people to plan ahead and to provide them with choice over the housing that best meets their needs. This could help people to live independently for longer, and reduce costs for health and social care services.

Helping older people to remain in their own homes and preventing or delaying the need to go into hospital or residential care can help improve the quality of life for older people and reduce costs to local services. Providing more options for older people to move to more suitable housing, when they want to, can also help to free up larger homes for use by families.

Strengthening planning guidance: The national Planning Policy Framework already requires local planning authorities to plan for a mix of housing based on current and future populations, market trends and the needs of different groups in the community, including older people. This applies to specialist accommodation as well as general housing for older people.

Many older people do not want or need specialist accommodation or care and may wish to live in general housing, or in homes which can be adapted to meet any change in their needs. Shortly we are publishing updated planning guidance to reinforce our expectation that all local planning authorities will assess and plan to meet the diverse housing needs of older people in their local communities. Local planning authorities need to be clear about the future level of both general and specialist accommodation that is needed for older people in their area.

There are already many great examples of innovative, well-designed housing schemes which help older people to live as independently as possible, such as the Joseph Rowntree retirement community scheme at Hartrigg Oaks in York and Lark Hill Retirement Village in Nottingham which both provide a broad range of options for older people, with support on-site as people’s needs change. There is help available to support local planning authorities to identify the type of housing that is required, such as the strategic housing for older people toolkit produced by the Housing Learning and Improvement Network and Association of Directors of Social Services. The Planning Advisory Service will support local authorities in ensuring their plans recognise the needs of their older people by promoting and sharing best practice.

Care and Support Specialised Housing Fund: increasing choice for older people who want to move to more suitable accommodation is important in helping people to live independently for longer. The Government are supporting the development of more affordable housing for older people and adults with disabilities and mental health problems, through the Care and Support Specialised Housing Fund. Phase 1 of the programme is on track to provide over 4,000 new homes by 2018, and the Department of Health has recently announced a further phase of up to £155 million for new homes for older people and disabled adults. Specialist housing providers, local authorities and other groups are invited to put forward bids for Phase 2, which outside of London will prioritise housing for people with mental health problems and encourage the provision of private market housing available for rent, shared ownership and purchase. Inside London the focus will be on delivering additional privately funded housing for older people, disabled people and people with mental health problems.

Right to Buy Social Mobility Fund: the Government also recently announced a new £42 million fund in 2015-16 to help council tenants who are eligible for right to buy to purchase a home on the open market. This will prioritise several groups of council tenants, including older people and will give those older people an opportunity to buy a home which is more suitable for their needs, or closer to family or support networks.

Improved Information and Advice: it is important that older people and their family have access to independent information and advice on their housing and care options to enable them to plan ahead and make the right choices. The Government recently announced a further £1 million funding for the FirstStop online and telephone information and advice service. This will enable it to continue in 2015-16 and to expand its local partner service which provides face-to-face advice to older people who need support with making the right choices about their housing and care.

Increasing house building by councils

In England, council house building starts are now at a 23 year high and twice as many council homes have been built in the last four years than from 1997 to 2009.

For local authorities, the self-financing reforms of 2012 which abolished the unpopular housing subsidy system have given stock-holding councils greater freedoms and the flexibility to manage their own housing businesses. Local authorities are now building again and more homes have been built since 2010 than in the last thirteen years combined. However, this has been at a time where we also needed to address the deficit left by the previous Administration and it was necessary to place limits on the amount of indebtedness a local authority could hold on its housing business.

Despite the limits on indebtedness that have been put in place the current 166 stock holding councils have borrowing headroom of over £3 billion which they can use to manage, maintain and renew their stock. The Government have also allocated an additional £222 million borrowing to 36 councils to support the provision of over 3,000 new affordable homes.

As councils are now taking the opportunities that self-financing has brought to start developing new homes again and are looking at a number of different ways in which to do this, the Government therefore think it would be helpful to set out policy in this area. The Government’s policy is that where a local authority is developing or acquiring and retaining new social or affordable homes for rent, that they should be brought forward using the powers available to them under part II of the Housing Act 1985 and that housing accounted for through the Housing Revenue Account. Where the numbers of units are very small—up to 200 units—the Secretary of State will consider, on application, issuing an exemption from the requirement to hold a Housing Revenue Account in line with one of the recommendations made by Natalie Elphicke and Keith House in their independent review into the role of local authorities in housing supply. If an authority is retaining more than 200 units for rent it should reopen its Housing Revenue Account and discuss with the Department the setting of a new indebtedness limit.

The Government are aware that some authorities may be using their general power of competence under the Localism Act 2011 to develop new social or affordable housing and accounting for that stock in their General Fund. Accounting for stock in this way is not in line with Government policy and if councils continue to develop social or affordable stock which they fail to account for within the Housing Revenue Account the Secretary of State will consider issuing a direction under section 74 of the Local Government and Housing Act 1989 to bring that stock into the Housing Revenue Account.

However, the requirement to account for stock in the Housing Revenue Account does not include accommodation being used to prevent homelessness or end a homelessness duty in the private rented sector, or for use as temporary accommodation. Temporary accommodation, including for homelessness purposes, would not normally be held within the Housing Revenue Account.

A key element of the Government’s drive to support people to achieve their aspiration for home ownership is through the reinvigorated right to buy. More than 33,000 new homeowners have been created since 2012 through the reinvigoration of the scheme. And we are giving more tenants the opportunity to buy their home, by increasing discounts in line with inflation and, subject to Royal Assent to the Deregulation Bill, taking forward a change in the minimum eligibility criteria, from five years to three years public sector tenancy.

For the first time, we have ensured that local authorities can keep the receipts from additional right to buy sales to invest in the provision of new affordable homes for rent. This is because we recognize the valuable role that local authorities can play in providing new homes for local people.

It is important that new council tenants should have access to the right to buy, and that new homes should not be built by councils which are excluded from the right to buy. In order to be eligible, local authority tenants need to have a secure tenancy. All forms of secure council tenancies are subject to the right to buy, including new flexible tenancies, regardless of whether they are accounted for in the local authority’s Housing Revenue Account or the General Fund.

A number of local authorities have established local housing companies to help deliver local housing solutions. The Government recognise the benefits that public private partnerships can bring in supporting new forms of housing, and notes that the Elphicke-House review into the role of local authorities in housing supply identified that different housing delivery organisations offer different strengths and opportunities. The Government welcome approaches where local housing companies are developing new homes for market sale or purchasing private rented homes for the accommodation of homeless households, through an appropriate legal entity structure and/or the borrowing does not count as public sector borrowing.

However, it is not acceptable for local authorities to establish new wholly owned or controlled housing companies deliberately to avoid the Government’s reinvigorated right to buy policy and the limits on indebtedness put in place to help address the inherited deficit. Specifically, the Government will not support the establishment of such companies where they are developing or acquiring and retaining new social or affordable units for rental purposes. The Government believe that local authorities should support people to achieve their aspiration for home ownership through the right to buy.

Supporting sustainable and secure buildings

We will shortly be laying before the House the fifth report required under the provisions of the Sustainable and Secure Buildings Act 2004. The report considers the progress towards the sustainability of the building stock in England over the preceding two years. During the period we have taken two important further steps on the road to zero carbon homes in 2016. We have improved the energy efficiency of new homes by over 30% since coming into office delivering typical fuel bill savings for new home-owners of £200 per annum.

We have also introduced in the Infrastructure Act 2015 the powers needed to enable off-site carbon abatement measures (allowable solutions) to contribute to achieving the zero carbon standard. During the period we have consulted on our proposals to rationalise technical housing standards through the Housing Standards review. We are streamlining them while maintaining essential standards for sustainability including the opportunity for higher water efficiency standards to be set in water stressed areas. The Government have sought to balance sustainability with the need to build new homes and promote economic growth. This report and its predecessors sets out our strong record in achieving that goal.

I hope these issues illustrate how this Government’s long-term economic plan is working and that building more houses, giving more power to local communities, and helping people move onto and up the housing ladder.

[HCWS441]

Open Recruitment

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I would like to update the House on what my Department is doing to increase transparency in Government.

My Department has taken a series of steps to deliver savings for taxpayers. Staff costs for core DCLG have fallen from £216 million in 2009-10 to £95 million in 2013-14, a reduction of 56% in cash terms and an annual saving of £121 million a year. The number of staff has been reduced by 57% from 3,781 full-time equivalent in 2009-10 to 1,622 in 2013-14. Spending on temporary staff (which can be cheaper than permanent staff for specific projects) has fallen from £14.4 million in 2009-10 to £3.3 million in 2013-14. Spending on consultancies has fallen from £36.6 million in 2009-10 to £0.5 million in 2013-14. Yet there remains a need to replace staff from time to time due to general turnover.

The Coalition Agreement pledged: “We will open up Whitehall recruitment by publishing central Government job vacancies online”. So, in April 2014, my Department became the first Whitehall Department to do this systematically. Under the situation we inherited from the last Administration, between a third and half of all job vacancies were not advertised to the wider public, but only to the civil service. This was the last closed shop—and a practice that was unfair not just to those in the voluntary or private sector, but also those who worked elsewhere in the public sector (such as local government). Under the last Administration, the practice also resulted in higher spending on consultancy contracts and recruitment agencies to bring in private sector expertise.

All jobs are now advertised online at: https://www. civilservicejobs.service.gov.uk/

From April 2014 to the beginning of March, we have made 136 appointments:

30% were filled internally;

30% were filled by applicants from other Departments; and

40% were filled by external candidates.

I believe this provides a good balance between promoting hard working staff internally, tapping into the expertise of the civil service, and benefiting from the skills and experience of those from the wider public, voluntary and private sector.

Parts of the civil service have been somewhat shy about recognising the benefits of this policy. I hope the wider Government will embrace such openness in the months ahead.

[HCWS439]

Unpublished Government Research Reports

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The last Administration spent £26 million on DCLG research reports that were never published. Throughout this Parliament, we have taken steps to publish this significant backlog of reports. We are publishing a further batch today, representing £9.5 million (excl. VAT) of taxpayers’ money.

The reports and findings do not relate to forthcoming policy announcements. They are not necessarily a reflection of this Government’s policies, and should be treated as a statement of the last Administration. We are publishing these documents in the interests of transparency.

Enhancing Young Peoples Involvement in Regeneration: New Deal for Communities and the Young Advisors Initiative. This report explores youth engagement and empowerment through a focus on the implementation of the DCLG devised ‘Young Advisers’ initiative which began with a pilot hosted by four New Deal for Communities and eventually comprised 43 projects hosted by a variety of organisations. This research was commissioned in 2005 as part of a programme of research on New Deal for Communities. The total cost of the New Deal for Communities research programme was £8,897,113 (excl VAT).

New Deal for Communities: National Evaluation Phase Two: Technical Report. This technical report provides a wide range of supporting evidence including details of the design of the New Deal for Communities programme and the national evaluation, data sources, statistical methods, analytical tools and outputs from analyses undertaken as part of New Deal for Communities evaluation. This research was commissioned in 2005 as part of a programme of research on New Deal for Communities. The total cost of the New Deal for Communities research programme was £8,897,113 (excl VAT).

Housing Support in the Growth Areasresearch report and Excel model guide. This report considers how the need for housing-related support, funded through the supporting people programme, is likely to change as the population in the growth areas continued to change. The report was commissioned in 2008 at a cost of £60,000, excluding VAT.

London 2012 Olympics: Regeneration legacy evaluation framework. This report presents a framework for the Department to measure the regeneration impacts and legacy of the London 2012 Olympics and Paralympics. The report was commissioned in 2009 at a cost of £95,780, excluding VAT

Coalfields regeneration: evaluation framework report. This monitoring and evaluation framework builds on previous research into coalfield areas. It provides an interim evaluation of the coalfields regeneration programmes in England. The study was commissioned in April 2005 at a cost of £270,517, excluding VAT.

Timely Information for Citizens Pilots: Evaluation Summary. This report was commissioned to maximise and disseminate the learning from the Timely Information for Citizens’ pilots. The evaluation aims to provide evidence on the efficiency and effectiveness of the Timely Information for Citizens’ programme; outcomes from the pilots and ‘what works’; and transferable learning. This research was commissioned in 2009 at a cost of £98,150 (excl VAT).

Working Neighbourhoods Fund Evaluation: feasibility report. This report builds upon the findings of the scoping study which was published in February 2010 and specifies the work that needs to be undertaken to complete an interim evaluation of the Working Neighbourhoods Fund. This report was commissioned in 2008 at a cost of £113,506 (excl VAT).

To help pay off the deficit left by the last Administration, this Government have sought to deliver better value for money for future research and ensured that sums expended are reasonable in relation to the public policy benefits obtained. My Department now has far more rigorous scrutiny and challenge processes for commissioned research. We commission less, and we do it better.

It is also available online at: http://www.parliament.uk/writtenstatments.

[HCWS438]

Defence

Pipeline and Storage System Sale Update

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I am pleased to announce the successful sale of the Government Pipeline and Storage System (GPSS) to Compania Logistica de Hidrocarburos (CLH) of Spain for £82 million, following a competitive sale process.

This means that I am close to completing the three major elements of the asset management programme that the Ministry of Defence (MOD) launched following the 2010 strategic defence and security review. I have previously announced the successful sale of the Defence Support Group land business to Babcock for £140 million, along with a 10-year contract to buy back services. The contract will save the Army around £500 million over that period—a saving of over a third. Last month I announced that Solent Gateway had been selected as preferred bidder for the concession to manage, and exploit the commercial potential of, the Marchwood Sea Mounting Centre—again generating significant savings to Defence. The sale of the GPSS leads to a further substantial receipt of £82 million. It also allows the Government to transfer their commercial fuel transportation business to the private sector, while still preserving the GPSS’s military capability and ensuring national resilience is not compromised.

As part of the transaction, an enduring contract has been agreed between the Secretary of State for Defence and CLH, which will protect the provision of GPSS—supplied aviation fuel to UK military bases, including those supporting US visiting forces; over the first 10 years of the contract the MOD share will cost some £237 million.

CLH will bring unique experience to the operation of GPSS as it operates and maintains a network of oil pipelines (over 4,000 km) and storage systems serving major airports across Spain. In addition it provides fuel transportation services (including storage and pipeline facilities) to military customers in Spain.

Of the staff employed by the Oil and Pipelines Agency, the Government body which manages the GPSS, just under 80 are in scope of the sale and will become CLH employees on completion of the sale, expected to occur on 30 April 2015. They will transfer under Transfer of Undertakings (Protection of Employment) (TUPE) regulations which will protect their terms and conditions of service. The GPSS sale does not include the six UK oil fuel depots owned by the MOD, which will continue to be operated and maintained by the residual Oil and Pipelines Agency.

In summary, this sale will generate a significant sale receipt while placing the GPSS network on a sustainable long-term footing, ensuring that the capability to supply aviation fuel to UK military bases and civil airports is retained.

[HCWS434]

Iraq Fatalities Investigations

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I wish to inform the House of progress in responding to the High Court’s decision in 2013 that a process akin to a Coroner’s inquest be established to examine a small number of fatalities of Iraqi nationals arising from UK operations in Iraq where the deceased person was in the custody of or under the control of UK forces.

Sir George Newman today publishes his report into the deaths of Mr Nadheem Abdullah on 11 May 2003 and Mr Hassan Abbas Said on 2 August 2003. Sir George’s terms of reference do not include making findings on any person’s criminal or civil liability but he has carefully examined the deaths of the two men and has considered the wider circumstances that contributed to them.

The report concludes that Mr Abdullah died after soldiers from 3 PARA used excessive force in restraining and searching him and the vehicle in which he was travelling after it avoided a vehicle checkpoint on 11 May 2003. With regard to the death of Mr Said, the report concludes that he died when a soldier attached to 1 KINGS fired a single shot after he attempted to seize the barrel of his rifle, and appeared to reach for the pistol of the soldier attempting to handcuff him. There is evidence that Mr Said was one of several men who fled when challenged by the 1 KINGS patrol for pushing a cart containing ammunition.

Sir George has made a single recommendation, which I have accepted in principle, that focused training on policing and peacekeeping roles in hostile and potentially life-threatening situations should be provided to any service personnel deploying on similar operations in future.

In the light of the facts as found by Sir George, and in particular the finding that excessive force was used, I wish to express the Government’s regret at the death of Mr Abdullah in particular. We are prepared to pay appropriate compensation to his family. The soldiers in both cases have already been prosecuted and acquitted, and will not face fresh prosecutions as a result of these inquiries.

I expect to establish one or more further such non-statutory inquiries into other fatalities during Operation Telic within the coming months.

[HCWS437]

Education

Teaching Profession

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The driving force behind the delivery of this Government’s plan for education is a world-class teaching profession. We share a common goal with thousands of dedicated professionals in classrooms throughout the country: of improving the lives of children and young people, and preparing them for success in modern Britain. We are committed to taking action that promotes and supports the development of the teaching profession.

In December last year, the Minister of State for Schools and I launched a consultation setting out what we believe Government can do to give teachers that support. Today we are announcing our plan of action designed to help teachers improve the quality of their professional development, and to strengthen the professional leadership of teaching overall. Alongside this we are publishing a report detailing the responses to the consultation that have led us to this plan.

The absence of a professional body, independent of Government, marks teaching out from other professions. We agree with the many teachers and school leaders who believe that the existence of such a body—set up and owned by teachers for teachers—could be a power for good in raising the professional status of teaching, and improving the development opportunities available to its members. What we have seen in other professions, such as law and medicine, is that their professional bodies’ play a leading role in advancing practice and we believe a college of teaching would be no different, becoming a key plank of our vision of a self-improving school led system. For that reason we invited expressions of interest from organisations seeking to establish a new college of teaching, and we set out our offer of Government support to make that new college a reality.

The Minister of State and I are today announcing that we intend to work with the “Claim Your College” consortium—a coalition of leading organisations in the education sector—in support of their proposal to establish a new college of teaching. The college of teaching is expected to be fully independent of Government, established and led by teachers. It is intended that its start-up costs will be met by a significant injection of Government funding, along with funding from a range of other sources. We, as well as the organisations and individuals leading this project, are clear that support must be offered wholly in recognition of the new body’s independence from Government. But if Government can play any part in facilitating this important step towards promoting the professional status of teachers and teaching, then it is right that we should do so.

In the longer term, a new professional body could play a leading role in the promotion of high-quality professional development for teachers. A commitment to high-quality, evidence-based professional development is one of the defining characteristics of all great professions. Teachers should be able to fulfil their own passion for knowledge and betterment by pursuing learning opportunities throughout their careers, enhancing their own practice and at the same time securing better outcomes for their pupils. Responses to the consultation, however, confirmed that teachers still face significant barriers in identifying and accessing those high-quality professional development opportunities, based on sound evidence of what works.

Recognising the critical importance of high-quality professional development, we proposed to support teachers with a new, high-profile fund for professional development programmes. These would be delivered under the leadership of the growing teaching schools network, and rigorously evaluated for impact. Programmes supported by the fund would help to ensure that many more teachers have access to high-quality development opportunities, particularly teachers working in those schools which have the greatest need for additional support.

This proposal was positively received. So we are today confirming that we intend to invite teaching schools to bid for funding—for projects worth up to £300,000 each —to deliver high-quality, evidence-based professional development. The growing reach of the teaching schools network, and the broad alliances of schools that they work with, will ensure that access to high-quality professional development opportunities becomes a reality for many more teachers. Our announcement today is for the first phase of this scalable fund, for which we are making up to £5million available in the first year. We will consider extending this amount based on demand and we hope that this step will be the first of many, helping build and secure a robust evidence base for teachers to draw upon.

Our proposal to work with the sector to establish a new, online portal to facilitate the sharing of evidence about proven approaches to professional development was also well received. We therefore intend to continue working closely with sector organisations to further explore how we might support the establishment and effective use of a new forum, not least to ensure that the rigorous evaluations of programmes funded through the Professional Development Fund become freely available to all teachers, in formats that will allow the findings to translate easily into practice. Doing so will help to ensure that, in future, teachers are able to make better-informed decisions about the professional development they undertake, based on evidence of what is proven to work in practice.

Alongside the consultation we also committed to establish an expert group tasked with producing a new standard for teachers’ professional development. This standard will set out a clear and succinct statement of the key elements of effective professional development practice, helping to shape both the demand for and supply of high-quality development opportunities for teachers. The Minister of State and I are pleased to be able to announce the appointment of David Weston, Chief Executive of the Teacher Development Trust, to chair the new expert group. We expect that the group will submit its report to Ministers early next year.

Copies of the consultation report will be placed in the Libraries of both Houses.

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Energy and Climate Change

Wood Review

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Today we are publishing the Government’s response to the Wood Review Call for Evidence, which sought views on how to best implement the Wood review’s recommendations to empower the Oil and Gas Authority (OGA) to be a strong and influential regulator, equipped with necessary powers to regulate and steward the UK Continental Shelf.

The call for evidence ran from 6 November to 31 December 2014. During the call for evidence process, we held a number of industry workshops in London and Aberdeen to discuss, in detail, the questions posed in the call for evidence. The workshops were well attended by a wide range of industry stakeholders and the evidence gained from them, as well as from the written responses, has now been reviewed. The responses received were broadly supportive of the policy positions set out in the call for evidence and the stakeholder views and the evidence presented have been carefully considered in deciding how to move forward.

Key policy decisions

Governance and scope: The OGA will be a strong, effective regulator, established as an Executive Agency on 1 April 2015, before (subject to the will of Parliament) transitioning to a Government company in summer 2016. To effectively respond to the challenges posed to the UKCS, a significant shift in regulatory culture is needed, and the OGA will be a confident and credible regulator, creating long-lasting cultural change within the industry for the ultimate benefit of the UK.

Delivering maximising economic recovery from the UKCS (MER UK): The MER UK strategy was a key recommendation made in the Wood review. Work is ongoing apace between all members of the tripartite—Industry, the OGA and HMG—to define MER UK and develop a fit for purpose strategy, which will help to deliver overall benefits to the UK.

New powers: The OGA will be provided with necessary tools to be a strong and effective regulator and to enable delivery of its objectives.

Meetings access: We will ensure the OGA has the right to attend industry meetings as an observer. This should apply to all parties covered by the MER UK strategy and should include meetings between operators within a joint venture, and meetings between licensees, where matters relating to licence obligations or matters relating to MER UK are being discussed.

Sharing data and information: We want to ensure the OGA has sufficient powers to gather relevant information. We are therefore proposing to take a power in primary legislation, allowing the powers to be developed as the priorities of the OGA become clearer, and ensuring time for further discussion with industry to ensure disproportionate burdens are not placed on them. Provisions will also be made to allow for sanctions to be imposed for breaches of any data or information obligations.

Dispute resolution: There is a recognised need for the OGA to have a non-binding role in the resolution of disputes. However, dispute resolution should be seen as a last resort and only used after the parties have made sufficient attempts to reach a resolution, working informally with the OGA. It is important that the OGA has the operational freedom to define the process by which it will consider and resolve disputes. However, the Government will set the scope of the scheme to ensure that the dispute resolution process assists in the delivery of MER UK. Any dispute that relates to licence terms or that impacts, or has the potential to impact, on MER UK may be resolved by the OGA and any party to the dispute or the OGA will be capable of initiating the process. The OGA will have information gathering powers and the ability to set timeframes for the provision of information, with the aim of speeding up the dispute resolution process. The OGA will also have the power to impose sanctions where parties do not comply with the dispute resolution process.

Reviewing existing powers: A review of the existing powers is under way to ensure they remain fit for purpose and will sufficiently support the OGA, once transferred, in its role of regulating and stewarding the UKCS.

Sanctions Regime: We will introduce a more gradated set of sanctions, which will include improvement notices and financial penalties. Sanctions will be applicable to all parties within scope of the MER UK strategy and will be applicable for breaches of MER UK as well as noncompliance with licence conditions and key powers exercised by the OGA. We are committed to ensuring sanctions are proportionate so will place a statutory limit of £1 million on individual financial penalties imposed. If, however, this amount does not prove to be a suitable deterrent in the future, the Government intend to reserve the right to increase this limit to £5 million subject to consultation and parliamentary approval.

Cost Recovery: The OGA’s costs will be met by a combination of the extant fees and charges regime, and a new levy on industry. We agree with industry that it is important that the levy is simple, transparent and cost-reflective. A detailed consultation on final proposals for administering the levy will be published later this month. In line with the early focus of the OGA, we have determined that initially the activities and costs, which fall under the levy will only relate to offshore petroleum licence holders. We intend that the OGA will begin collecting the levy in October 2015. The OGA will continue to recover the costs associated with permits and consents via the extant fees and charges regime. However, to comply with the Managing Public Money principles, the scope of the charging regime will be reviewed in due course.

Conclusion

The call for evidence was a crucial opportunity to hear industry’s views and shape our policies. We are now working hard to prepare a Bill which, subject to the will of the Government, will be introduced to Parliament during summer 2015. The Bill will establish the OGA as a Government company, as well as providing it OGA with the above-mentioned powers.

I will be depositing a copy of the Government response in the Libraries of the House.

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Foreign and Commonwealth Office

Tunisia: Terrorist Attack

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I wish to update the House on the terrorist attack in Tunis on 18 March. I condemn this despicable murder of innocent people.

A small group of terrorists attacked the Bardo Museum in central Tunis at around 11.30 GMT on 18 March. The gunmen fired on foreign tourists disembarking from buses outside the museum (adjacent to the Parliament building). As people took refuge in the museum, they were trapped inside by the gunmen. Tunisian security forces later entered the museum, killed two of the attackers and, we understand, arrested a third, bringing the incident to an end. The attack resulted in the death of two Tunisians and at least 20 foreign tourists, including one British national.

As details of the attack became known, British Embassy consular staff deployed quickly to hospitals and to two cruise ships at the port, to check on the welfare of British nationals. They learned of a possible UK casualty whose location was, at that time, unknown. At around 18.00 GMT they learned the likely location of the casualty in hospital and redeployed. They provided consular support to the family throughout this time. On the morning of 19 March we received confirmation that, very sadly, Sally Adey had been killed in the attack. We continue to provide her family with consular support. My thoughts are with them at this very difficult time.

The Prime Minister wrote to President Essebsi yesterday to express his condolences and assure him that Britain stood firmly with Tunisia in the face of this shared extremist threat. I spoke in similar terms to Prime Minister Habib Essid on the afternoon of the attack. I told him that the terrorists sought to undermine Tunisia’s successful transition to democracy, but that they would not succeed.

Since Tunisia’s revolution, the British Government have worked with the Tunisian Government in a number of areas, including security and counter terrorism, where we have provided training and equipment and shared expertise. We stand ready to provide further assistance, including through the deployment of police from the Metropolitan Police Counter Terrorism Command (S015) to support the post attack investigation. S015 and UK military Counter Terrorism experts will also be providing longer term capacity building. We will be working alongside EU partners and the US to help Tunisia manage the foreign fighter threat, while continuing to provide assistance in areas such as aviation security and tourist resort protection.

We are aware of reports that ISIL has claimed responsibility and given names of the attackers, but the Tunisian investigation is continuing and this information is as yet unconfirmed.

This brutal attack illustrates the threat from terrorism faced by Tunisia, and other countries in North Africa. Our Travel Advice prior to the attacks indicated that the threat of terrorism in Tunisia was high and that attacks could be indiscriminate, including in places visited by foreigners. We reviewed the threat level after the attack and the Travel Advice has been amended to indicate that further attacks are possible. We are not advising against travel to Tunisia. We keep our Travel Advice under constant review.

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Northern Ireland

Northern Ireland Security Arrangements (Carlile Report)

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This is a summary of the main findings from the report by Lord Carlile, the independent reviewer of national security arrangements in Northern Ireland, covering the period from 1 December 2013 to 31 December 2014:

“Throughout the year I have been briefed extensively on the state of threat in Northern Ireland. The context in which national security activities are performed in Northern Ireland remains challenging. There have been successes in 2014 and a number of trials of significant alleged terrorists are pending. This is a very dangerous, unpredictable terrorist threat, though one which is much smaller than in the days of PIRA terrorist activity. The authorities are achieving a good level of attrition. Most of the public lead lives unaffected by terrorism.

I regard 2014 as a year of continuing success in thwarting and detecting terrorism. Pending trials are likely to demonstrate this, as have trials during the year. However, there is no sign of reduced ambition in the minds of terrorists, and limited evidence of a lack of capacity on their part. Attrition and continued effort against the dissident republican groups remain a paramount requirement. The number of ongoing investigations remains high. The work is painstaking and, for some involved, potentially dangerous. Peace is in no small way the result of these efforts by PSNI and MI5 personnel.

In preparing this report I have considered the current threat level, and what I have learned of events of a terrorist nature during the year. There have been several serious incidents during 2014, as well as a spate of crude letter bombs. Once again the parading season proved a challenge. Although there were some injuries as a result of sectarian clashes, it was more peaceful than in 2013, with fewer injuries to police and public.

During 2014,1 have met a range of stakeholders. I have engaged with PSNI and MI5 and examined the relationship between them and others. I have held meetings with HM Inspectorate of Constabulary concerning activities relevant to this Report, and with the Police Ombudsman for Northern Ireland and the Northern Ireland Executive's Minister of Justice, David Ford MLA. The liaison between Mr Ford and those responsible for national security issues is satisfactory. I have also engaged with the Independent Human Rights Adviser to the Northern Ireland Policing Board (NIPB) and the Board itself. The Policing Board can feel reassured that the Human Rights Adviser is well able to discharge her duties in respect of national security. The Board has been shown the material reports in relation to Northern Ireland of the Office of the Surveillance Commissioners, subject to minor redactions. Compliance is at 'best in class' level. I am grateful to NIO Ministers for their close interest in national security matters discussed; meetings with Ministers have occurred. Ministers are always very well informed on all material security issues.

I am satisfied that the periodic briefings provided to me have been full and not selective, and that I have a good understanding of relevant matters. I note that when matters of moment occur, active steps are taken to ensure that I am briefed. When I request access, it is given.

I have asked questions again this year about the relationship between MI5 and PSNI staff working alongside each other in security operations in Northern Ireland. Comments made to me in 2014 about the relationship between the two services were strongly mutually supportive. That they work together well and in the national interest is beyond question. The effectiveness of what they do is demonstrated by the successful disruptions that have taken place over the year.

This year once again I have reviewed in some detail the arrangements for Covert Human Intelligence Sources (CHIS). Overall, the use of CHIS has been effective. All activity and decision making concerning CHIS are documented carefully and European Convention on Human Rights issues are fully considered. There is a rigorous legal and policy framework for dealing with CHIS. The Regulation of Investigatory Powers Act (RIPA) 2000, and associated orders and codes, provide the legal framework for authorising and managing CHIS within the UK in a way that is compatible with the European Convention on Human Rights, and particularly the right to privacy. It requires that use of a CHIS is subject to prior senior officer authorisation, limits the purposes for which the CHIS may be used, ensures detailed records are maintained, establishes independent oversight and inspection, and provides an independent appeals mechanism to investigate complaints.

I have also considered a number of issues relating to terrorism prosecutions including arrangements for the continuation of the temporary and renewable non-jury trial arrangements provided under the Justice and Security (Northern Ireland) Act 2007. The situation continues to improve. The number of cases requiring non-jury trial diminishes. The Director of Public Prosecutions for Northern Ireland uses considerable and proper care in the identification and selection of such cases. It is fully recognised that the norm is jury trial but the residual serious and lethal threat of terrorism justifies the continuation of the non-jury system.

There is no evidence of any disadvantage in terms of outcome to defendants in the current system of non-jury trials. They are as likely to be acquitted as in jury trials, and have the advantage of reasoned judgments, and less inhibited access to appeals. Part of the criminal justice setting in need of appraisal is sentencing in terrorism related cases. Generally such sentences are considerably shorter than comparable sentences in England and Wales, with notably different tariffs in murder cases.

I remain as concerned as before about the disclosure regime operated in scheduled cases in Northern Ireland. In England and Wales issues of Public Interest Immunity and other disclosure issues are dealt with by the trial judge, who of course is not the tribunal of fact save in the rarest of trial exceptions, or in 'Newton' hearings where there has been a plea of guilty on a disputed factual basis. In Northern Ireland in non-jury trials there is a separate disclosure judge. This still leads not only to delays in trials, but to a disconnect between the day by day reality of the trial and the insulated disclosure process.

I remain concerned that the disclosure issue outlined above is a real difficulty in dealing with non-jury cases. Given the high regard held generally for the quality of the reasoned judgments given in such cases, and also for the fairness of the trials, I find it difficult to accept that there would be any diminution in actual fairness if the trial judge dealt with disclosure too.

I have inquired about the use of intercept evidence. I remain satisfied that there is solid scrutiny and review of interception, in an environment in which communications technology is developing quickly.

As before, I have asked about loyalist paramilitaries. These are people and groups whose real interest is in making money from crime. The authorities are well sighted against these organisations. I have enquired about violent Islamism in Northern Ireland. For the present this is not a significant threat.

Continued vigilance and the maintenance of counter-terrorism resourcing are essential. However, once again I have drawn comfort from the successful joint operations between MI5 and the PSNI.Normality is a genuine and mostly realisable ambition, rather than merely an aspiration.

I have measured performance in 2014 against the five key principles identified in relation to national security in Annex E to the St Andrews Agreement of October 2006. My conclusions in relation to Annex E are set out in the attached Table.”

Further to reinforce this comprehensive set of safeguards, the Government confirmed that they accept and will ensure that effect is given to the five key principles which the Chief Constable has identified as crucial to the effective operation of the new arrangements, viz:

Text of Annex E

Conclusions

All security service intelligence relating to terrorism in Northern Ireland will be visible to the PSNI.

There is compliance. Arrangements are in place to deal with any suspected malfeasance by a PSNI or MI5 officer.

PSNI will be informed of all security service counter-terrorism investigations and operations relating to Northern Ireland.

There is compliance.

Security service intelligence will be disseminated within PSNI according to the current PSNI dissemination policy and policy and using police procedures.

There is compliance. Dissemination policy has developed since the new arrangements came into force.

The great majority of national security CHIS in Northern Ireland will continue to be run by PSIN officers under existing police handling protocols.

The majority of CHIS are run by the PSNI. Protocols have not stood still. A review of existing protocols and the development of up to date replacements should always be work in progress and clearly accountable.

There will be no diminution of the PSNI’s responsibility to comply with the Human Rights Act or the Policing Board’s ability to monitor said compliance.

The PSNI must continue to comply. The Policing Board, with the advice of their Human Rights Advisor as a key component, will continue the role of monitoring compliance.

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Transport

Transport Council

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I attended the first Transport Council under the Latvian presidency (the presidency) in Brussels on Friday 13 March.

The first item on the agenda was a policy debate on the Fourth Railway Package. The presidency sought further guidance on the market pillar of the package in order to reach their ambition of achieving a general approach by June. I set out the great success of our liberalised market and urged member states to grasp the opportunity of the market pillar to develop a true single market for rail and support a vibrant, competitive and sustainable rail sector across Europe.

The debate on the three key issues identified by the presidency—the independence of infrastructure managers and ex-ante oversight role of regulatory bodies on appointments to infrastructure boards under the governance file and how to ensure non-discriminatory access to rolling stock under the public service obligation file—drew a split response.

On governance, I had strong support from a range of member states for the approach that a truly separated model was the most effective remedy against potential discrimination by the infrastructure manager towards the railway undertakings, and that additional regulation was not required in such cases.

On providing non-discriminatory access to rolling stock to ensure an effective opening of the market, I shared our positive experience of establishing a leasing market. Whilst all member states recognised the need to address this barrier, many member states pressed for flexibility to choose from a “toolbox” of options.

There was a call for a progressive move towards competitive tendering to avoid market failure from a sudden change, and mixed views on reciprocity measures if a long transition period were granted. The differing needs of member states under fierce competition from bordering third countries was highlighted and consideration of the social dimension of new operators entering the market was requested.

The presidency presented a paper on EU competitiveness and transport policy, focussing particularly on the funding opportunities from the new European Fund for Strategic Investments (EFSI). Commissioner Bulc then stressed three key principles: first, the need to invest in infrastructure and the shortfall within the EU for such activities; secondly, the need to embrace innovation for example, autonomous vehicles; and, thirdly, the need to remove technical and legal barriers to enable the transport sector to grow.

Other member states views included the need to invest in innovation; the importance of the EFSI fund; less regulatory burdens; and state aid rules becoming more permissive to help ensure that there was a level playing field with non-European countries.

I emphasised the importance of preparing projects so that they were ready to begin by the end of the year and called upon the Commissioner to return to Council to outline which transport projects were being funded by EFSI so that the existing grant mechanisms could be reviewed in light of developments there. Commissioner Bulc agreed to my request to report back on EFSI transport funding and repeated that her key mission was to ensure that EU transport policy was built around citizens and industry needs.

Under any other business the presidency informed Council about the forthcoming Asia European meeting of Transport Ministers on 29-30 April in Riga, noting that increasing trade between Europe and Asia called for enhanced connectivity.

The presidency updated Council on the outcome of the conference on remotely piloted aircraft systems on 5-6 March in Riga, drawing attention to the Riga declaration which summarised the key principles of developing a risk-based and light-touch approach to regulation but with sufficient speed to provide the necessary investment conditions in this fast-developing sector.

Commissioner Bulc updated Council on actions taken following the downing of aircraft MH17 over Ukraine in July 2014, and encouraged member states to support the European Aviation Safety Agency’s mechanism for sharing civil and military risk assessments of civil aviation flights over conflict zones.

The Commission delivered a presentation on their Energy Union Communication of 25 February, emphasising that the goal of decarbonised transport called for a gradual transformation of the entire transport system. The Commission believes that its planned road package, to be published in 2016, will address reducing CO2 emissions from vehicles felt that success would depend upon member state actions, not least in implementing alternative fuels infrastructure and supporting local authority sustainable urban mobility plans.

Lastly, France and Germany called for a comprehensive air transport agreement between the EU and the six members of the Gulf Co-operation Council (GCC) as a means to persuade the GCC to adopt “fair competition” principles. Germany emphasised that if the conditions of fair competition and limited market opening were achieved, she would be willing to consider a mandate for a comprehensive agreement with the GCC. Both member states pressed their support for the Commission to bring forward a revision or replacement of regulation (EC) 868/2004 on protection against subsidisation and unfair pricing.

Several member states supported this position whilst the need to address distorted working conditions within the EU was highlighted. I advocated the wider benefits of liberalised international air transport for both business and the consumer in UK and across Europe through the creation of jobs and growth, better regional connectivity and improved customer choice and quality. I noted the potential benefits of a comprehensive air transport agreement and a review of the unfair pricing regulation but urged member states not to lose sight of the value of Europe’s relationship with the GCC states in air transport which extends to purchases from EU manufacturers.

The Commission suggested it may proceed with a comprehensive air transport agreement as a means to send a strong and united EU position to the GCC states while its work would continue on bringing forward a revised or entirely new regulation 868/2004 with sufficient teeth to be effective.

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Highways England Framework Document

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Last week I announced to the House the formal appointment of Highways England as the strategic highways company with effect from 1 April 2015 and published a number of key governance documents.

Today I am publishing the final part of the formal governance framework, the Highways England Framework Document. This sets out the relationship with Government, especially the arrangements for accountability to Parliament and stewardship of public money.

As I have made clear before, Ministers will continue to be accountable for making sure the network is managed responsibly, in a way that safeguards value for public investment and meets the needs of road users and wider society, both today and for future generations.

A copy of this Framework document has been placed in the Libraries of both Houses and is available at:

https://www.gov.uk/government/collections/roads-reform.

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Rail Franchise

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I am pleased to inform the House that my Department has reached agreement with First Keolis TransPennine Express Limited to continue to operate train services in the North of England and Scotland. This means that the current franchisee will remain in place for a period of 12 months from 1 April. There will be an optional extension period of up to 10 months. This deal ensures that passengers across the north continue to benefit from TransPennine Express’ experience of running this franchise. It also paves the way for the new competitively-let TransPennine Express franchise, which will deliver new trains and improved services.

As I announced on the 8 January, my Department has reached agreement with Northern and TransPennine Express to ensure continuity of services after five of TransPennine Express’Class 170 diesel trains are transferred to Chiltern Railways, by their owner, Porterbrook Rail Leasing Ltd. I can inform the House that my Department has agreed with Direct Rail Services Ltd to operate an enhanced train service on the Cumbrian coast line, between Carlisle and Barrow-in-Furness as part of this deal.

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Passenger Focus (Triennial Review)

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I am today publishing the report of the triennial review of Passenger Focus (PF).

The review has considered the continuing need for PF’s functions and the case for it to remain a non-departmental public body (NDPB). It has also looked at the control and governance arrangements in place to ensure that PF is complying with recognised principles of good corporate governance.

PF represents the interests of rail passengers in England, Scotland and Wales, bus and tram passengers in England (outside of London) and passengers on scheduled domestic coach services in England. It will shortly be taking on a new additional role representing users of the strategic road network in England.

I am pleased to announce the conclusion of the review and the publication of the report.

The report concludes that the functions of PF are still necessary, that it remains the right body for delivering them and that PF should remain a NDPB (Stage 1 of the review). The report also concludes that PF is managed to a high standard with well-structured and effective governance systems in place, with only a few minor administrative issues which should be capable of being quickly addressed (Stage 2 of the review).

Although the review did not consider in detail PF’s future role in relation to highways, the report comments that the organisation appears to be in good shape to take this on, with well-established structures and procedures, and led by an effective and well-engaged board.

The report also says that with substantial change and expansion of scope imminent as PF takes on the highways role, it is right that PF is undertaking a review of its current structure and funding arrangements to ensure they remain fit for purpose.

I would like to thank Andrew Murray for carrying out a thorough analysis of PF and its governance arrangements, and PF for its assistance as well as all the other stakeholders who were involved during the course of the review.

The review was conducted in accordance with Cabinet Office guidance (Guidance on reviews of non-departmental public bodies, June 2011).

The report is available on www.gov.uk and I have made available copies in the Libraries of the House.

It is also available online at: http://www.parliament.uk/writtenstatements.

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