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Commons Chamber

Volume 598: debated on Monday 13 July 2015

House of Commons

Monday 13 July 2015

The House met at half-past Two o’clock


[Mr Speaker in the Chair]

Oral Answers to Questions


The Secretary of State was asked—

Helicopter Fleets

The Government are investing to transform the helicopter fleets supporting our armed forces. Last week’s news of a bigger budget and confirmation that we will meet NATO’s target of 2% of gross domestic product reinforces confidence in our equipment plan, which sets out our plans to spend more than £12 billion on helicopters over the next 10 years.

I thank the Minister for the welcome investment in the helicopter fleet, which is underpinned by the commitment to spending 2% of GDP. The tactical supply wing of the RAF, which is based in my constituency of Stafford, supports UK, NATO and allied helicopters around the world by performing hot refuelling, which means that the rotors are running. Will he confirm that sufficient resources will be made available to TSW so that it can support the investment in the new fleet?

I congratulate my hon. Friend on taking such an interest in the tactical supply wing, which is based in his constituency. I believe that he has seen it on duty, supporting our training activities in Kenya. I join him in paying tribute to the unit, which provides invaluable support to deployed helicopter fleets, at extreme and very high readiness. It recently supported our Merlin helicopters on HMS Bulwark to assist in the fight against Ebola in Sierra Leone and in the human trafficking efforts in the Mediterranean. I know that he takes a great interest in both matters.

The Minister will know that it is not only what we buy that is important, but where it is manufactured. What percentage of our helicopters are made in the UK, and what about the other defence industries that seem to be declining? We are relying too much on imported defence equipment.

I confirm that of the five principal helicopter fleets, two are manufactured by AgustaWestland and supported from Yeovil; one is supplied by Eurocopter, which has activities in Oxfordshire; and the Chinook and Apache fleets are Boeing.

Does the Minister agree that we want the best helicopters for our forces? It is right that there is a spread, but we want the best, not necessarily just ones that were made in this country.

I completely agree with my hon. Friend, who has some knowledge of this subject; I met his son flying one of the Chinook aircraft in his constituency. It is right that we invest in the best capability and provide our forces with the best equipment that is available across the world, irrespective of where it is manufactured.

Cadet Units: Schools

I am sure that my hon. Friend will have welcomed the Chancellor’s announcement in last week’s Budget of an extra £50 million to expand the number of cadet units in schools to 500 by 2020. That is excellent news and will ensure that more young people get to experience the life-enhancing activities that cadet service brings.

I do, indeed, welcome that excellent investment. I recently met members of the cadets and reserves association for Hereford and Worcester at the Three Counties show, where they told me about their excitement at more state schools being able to host cadets. Will the Minister update me on the progress of that project in Worcestershire?

I am delighted that, in addition to the existing combined cadet force units in Kidderminster and Stourbridge, four more schools in Worcestershire will give their pupils the chance to join a CCF unit as a direct result of the cadet expansion programme: the Tudor Grange academies in Redditch and Worcester have established new units; and North Bromsgrove and South Bromsgrove high schools have forged partnerships with the CCF unit at Bromsgrove school. This is a real success story and I am delighted that many more young people will reap the benefits of belonging to a cadet unit.

Community-based cadet forces heard with great envy about the £50 million of additional funds for school-based cadet units, but what will be the impact of that funding on community-based units? There is great concern that students will be seduced into staying in school, rather than attending community-based units. Some instructors in community-based units are extremely anxious that they will be wound down and lose their important role within their communities.

The hon. Lady is right that the cadet expansion programme applies to schools, and that there are two types of cadet unit. We are absolutely determined that the programme will not have a negative impact on community cadets, and to that end I am looking carefully at how we can continue to enhance the role of our adult volunteers, for example by considering the expansion of Frimley Park, where they are trained.

Reserve Forces: Recruitment

Six thousand, eight hundred and ten personnel joined the reserve forces in the last financial year, an increase of 65% on the year before. We have made significant improvements to recruiting processes, the offer to reservists and the support we give employers. As a result, recruitment continues to improve, and we remain committed to meeting our overall target.

I congratulate the Minister not only on the fantastic decision to spend 2% of GDP on our armed forces but on his decision to save William Coltman House, the Army reservist centre in Burton. Will he join me in commending Major Marvin Bargrove and everybody else involved for their work in increasing recruitment and showing people in Burton the opportunities that are available through being part of our reservist force?

I share my hon. Friend’s delight both at the announcement of the 2% commitment and at the fact that we have been able to save the centre in Burton. He will be aware that 4 Mercian, which has a detachment there, has recently been deployed in a number of interesting exercises, as well as providing two formed platoons for an operational deployment in Cyprus.

What progress has the Department made in getting employers to recognise the benefits of their employees becoming reservists, and of hiring reservists?

This year, we have already awarded 160 new bronze awards and 25 new silver awards for employers. We are also building links between companies in industry sectors and their equivalent reserves. For example, the Royal Signals is formalising links with BT, Vodafone, HP and Virgin Media; Defence Medical Services has an excellent arrangement with the NHS; and the Military Provost Service is partnering with Serco.

I, too, welcome the 2% commitment, which will ensure that the right level of reserves will be reached.

Does the Minister agree that it is absolutely right that reservists who see action get the right equipment to protect them, which would include the use of drones manufactured by some of my constituents at BAE Systems?

The 2% commitment enables us to reconfirm the additional £1.8 billion for the reserves. All reservists today are routinely supplied with the same uniform and personal equipment as their regular counterparts, and last year we were able to bring forward earlier than expected £45 million of investment for dismounted close combat equipment. I am afraid that it is above my pay grade to answer my hon. Friend’s question about drones.

The Prime Minister has said today that he wants an increase in the number of special forces. Given our armed forces’ greater reliance on reservists, what are the Minister and the Government doing to ensure that we still have a good pool from which to pick our special forces?

As a former Defence Minister, the hon. Gentleman will know that Ministers of the Crown never talk about special forces in the Chamber. On his wider point about the size of the pool in the armed forces as a whole, our commitment, as shown most recently by the 2% announcement, is to outstanding armed forces in quality and equipment.

I understand that the coroner is due to give his judgment shortly, possibly tomorrow, in the case of the reservists who died in the Brecon Beacons. Will the Minister undertake to come to the House and make a statement following that judgment?

Two weeks ago the Secretary of State said that he was confident that the Government’s target for reserve recruitment would be met. He said that the programme was “now back on schedule”. However, last month the Major Projects Authority downgraded the Future Reserves 2020 project from “doubtful” to “unachievable”. Who is right, the Major Projects Authority or the Secretary of State?

The Major Projects Authority reviewed the Future Reserves 2020 programme almost a year ago, in September 2014. By convention the review is published six months behind, and because of purdah and the election it was published something like 10 months behind. A great deal of water has flowed under the bridge since then.

Indeed. Last week’s Budget Red Book committed the Government to maintaining a Regular Army of 82,000, but there was no mention of reserve forces. Can the Minister confirm whether the target of 30,000 reservists announced at the beginning of the process will be met?

The target of 30,000 Army reservists—indeed, 35,000 trained reservists across the three services—was firmly in the Conservative party’s manifesto, and this Conservative Government are committed to delivering it.

I warmly welcome the maintenance of that target, and I congratulate the Minister on what has been achieved so far. He will recall that the purpose of the target was to enable the reserve and regular forces to be interoperable—change backwards and forwards between each other. A reserve force was to do precisely the same job as the regulars who, in the case of the Army, we were then cutting by 20,000. Will he confirm that the excellent plan that he laid out before the last election—and which has been laid out consistently in the House since—will remain? Will there be any change in that way that we use reserves?

As my hon. Friend knows, the Government do not accept that the expansion of the reserves was a direct swap with regulars in the way that he describes. The purposes of the reserve forces were set out in the commission—which, as he says, carried my signature—and were threefold: to provide extra capacity at slightly lower readiness; to provide skills not available to the military; and to rebuild the connection between the military and society. We are committed to all those things, and the commitment of £1.8 billion over the next 10 years for reserves, which was recently reaffirmed by the 2% commitment to defence spending, further underlies that.

If the Minister would look at the House we would all be deeply obliged to him. I understand the natural temptation to turn round, but if he could face the House it would be helpful.

I welcome the Prime Minister’s commitment to increase by 10% the number of our armed forces from ethnic minorities. Can the Minister confirm that that will include members of the reserve forces?

Yes, I can. We are strongly committed to our black, Asian and minority ethnic targets. It is a fact that the attraction of UK citizens from ethnic minorities—as opposed to Commonwealth citizens—to the reserve forces, has consistently run ahead of figures for the regular forces.

Aircraft Carriers

5. What assessment he has made of the potential contribution to the economy of the building of the Queen Elizabeth class aircraft carriers. [R] (900910)

At its peak in 2013-14, the carrier programme created or sustained around 8,000 jobs at shipyards in Glasgow, Portsmouth, Devon, Birkenhead, Newcastle and Rosyth, with a further 3,000 jobs in the supply chain. These are the largest and most powerful warships ever built for the Royal Navy, and they will be flagships for British technology and innovation for the next 50 years.

The House will know of my special interest because my daughter is an officer in the Royal Navy, and I know that she and her colleagues will welcome the 2% commitment. The excellent initial sea training facility in my constituency at HMS Raleigh contributes to the economy of Torpoint and the surrounding area. Is the Minister confident that we are meeting the training requirements necessary to ensure that we have the manpower to run those ships?

I pay tribute to the service of my hon. Friend’s daughter in the Navy. Although three times the size of HMS Invincible, the new carriers will operate with approximately the same number of crew. The Royal Navy is already planning to ensure that it has the suitably trained and qualified people it needs, which includes training at HMS Raleigh in my hon. Friend’s constituency and at Devonport nearby.

As the Secretary of State points out, the Queen Elizabeth class was partly built on the Clyde where the Type 26 frigates are to be built. Can he explain a quote from the Cabinet Office, reported in yesterday’s edition of The Sunday Times, which stated that the Type 26 frigates will now be ordered in small batches

“to bring realism to the programme”?

What does that mean, and what was so unrealistic about the initial order?

We confirmed earlier this year that we are spending £859 million on the design of the Type 26 frigates and on some of the long-lead items for the first three.

I have no doubt that the Type 26s are on the order book, but could the Secretary of State explain the quote from The Sunday Times yesterday about the need

“to bring realism to the programme”?

What was so unrealistic about the initial programme?

Only the Scottish National party could regard £859 million as somehow half-hearted. We will finalise the design of the ships shortly, but we have to make sure that we get good value for taxpayer pounds.

Armed Forces Covenant

The Government are honouring their pledges under the covenant and encouraging wider society to think about its contribution. The Secretary of State has written to the chief executive of every company in the FTSE 350 asking them to consider what they might do better to support our armed forces community, including by signing a corporate covenant.

The demands of service life can impose obstacles for personnel, for example in credit ratings, mortgages and even mobile phone contracts. We are taking forward work to combat commercial disadvantage as a priority.

I am keen for companies in my part of north Yorkshire to sign up to the corporate covenant. Can the Minister update the House on what plans he has to extend the scheme across the country?

As I mentioned, the Secretary of State has already written to the chief executives of the 350 largest companies, but the House could do worse than follow the example set by my hon. Friend who is, I know, a champion of the armed forces in his constituency. In light of that, I intend to write to all hon. Members to offer them an information pack and to encourage them to engage with companies in their constituencies, so that we can extend the corporate covenant across the UK.

My constituents at Catterick garrison welcome the 2% commitment, but commercial disadvantage often bedevils them when it comes to areas such as insurance and mortgages. Can my hon. Friend update the House on how he is working with companies to tackle that disadvantage?

The Government have taken a number of steps to level the playing field for those in the military who seek financial products. We have secured a pledge from the UK Cards Association, the British Bankers Association and the Council of Mortgage Lenders to notify their members that those who serve in the armed forces should not be disadvantaged because of their occupation, and that applications for credit and mortgages should be treated fairly and consistently.

May I start by expressing my gratitude for the covenant funding that Somerset has received, including for the Tall Trees family centre in Ilchester, which serves the Fleet Air Arm at Yeovilton and their families? It has been brought to my attention that the criteria for fertility treatment for those serving in the Army can be more restrictive on the issue of existing children than those of some clinical commissioning groups. Will the Minister please look into that as a matter of urgency so that we can continue to ensure, in the spirit of the covenant, that no one is disadvantaged by serving in the forces?

The NHS has committed to providing fair treatment to the armed forces community. I would be concerned if any policies discriminate against our service personnel, but I am not aware that that is the case for the assisted conception policy. That said, if my hon. Friend has evidence to the contrary, I would be delighted to meet him in support of his constituents.

It is over a year since the Labour party called on the Government to undertake an audit of what local authorities are being asked to do and what resources they are being given to meet the expectations laid out in the community covenant—which we are all committed to. When will the Government carry out such an audit, so that we know once and for all what is actually happening on the ground and can start to take steps to rectify problems and meet the spirit of the covenant and the Government’s intentions?

I am delighted to say that all local authorities in England, Scotland and Wales have now signed the covenant, and that is excellent news. I am keen that we should have best practice across local authorities, and we have the annual report to Parliament, which has now been published on three occasions. I am more than happy to look at this matter and come back to her.

Last Friday, I attended a military covenant event in Flintshire, organised by the county council, which brought together employers to look at how they could recruit reservists and provide employment to former military personnel. The outputs of that are very successful. Will the Minister give an indication not just of the number of those who have signed the covenant but of the outputs of their involvement with the covenant, through a proper audit?

I am delighted to hear the good news. Word is finally spreading across the land and we are seeing some areas of best practice. I recently awarded Barclays a gold award. Its AFTER programme is a fine example to other companies of the outputs the right hon. Gentleman desires.

The problem with the military covenant is that it is not being properly observed and veterans still remain a disadvantaged group in civilian society. A poll carried out for SSAFA last month makes it clear that seven out of 10 people believe not enough is being done to support ex-armed forces personnel. The same poll found that eight out of 10 people had never heard of the covenant. Many of the veterans who face the biggest problems are under 35 and, although that is not the group people think of when they imagine a veteran, they do struggle greatly. SSAFA says that one in 20 has been forced to take out a payday loan. What in particular are the Government doing to address the problems faced by younger veterans?

I am slightly disappointed by the hon. Lady’s tone. I think this Government have done more than any previous Government to address these matters: it was this Government who enshrined the military covenant in law; it was this Government who, for the past three years, had a report to Parliament; and we have invested nearly £150 million of LIBOR funding. Yes, these things do take time, but we are moving forward in a positive way. The hon. Lady seems to quote rather selectively from the SSAFA report. I would much rather come to this Dispatch Box and work with her to ensure that we can move this forward, rather than simply try to pick it to pieces.

Submarines: Irish Sea

7. What discussions he has had with the Northern Ireland Executive on submarine activity in the Irish sea in the past 12 months; and if he will make a statement. (900912)

There have been no such discussions between the Secretary of State, or other Defence Ministers, and the Northern Ireland Executive.

The Minister is well aware that I have been in correspondence with her regarding an incident on 15 April, when a Northern Ireland-registered fishing vessel had its gear snagged. The Ministry of Defence confirmed that it was not a vessel belonging to the Royal Navy. Would it be possible for the Minister and the MOD to pursue the matter of jurisdiction and who undertook such activity, in order to obtain compensation for the loss of fishing days?

I know that the hon. Lady is very concerned about this issue. She will know that the Royal Navy takes its responsibilities very seriously. Since 1993, it has adhered to the comprehensive code of practice and conduct for operations in the vicinity of fishing vessels, which ensures not only the safety of our ships and submarines, but other vessels. I can tell her that any NATO submarine under UK operational control would also have to conform to that code of practice, but obviously we are not responsible for other people’s submarine operations.

Does my hon. Friend agree that under the Scottish National party’s deeply flawed defence plans, this country would have far less ability to detect, intercept and deter potentially hostile vessels in the Irish sea and elsewhere? [Interruption.]

Order. Let me just remind the hon. Gentleman, in the most genial spirit but in terms that are unmistakable, that questions must relate to the responsibilities of Ministers, not of other parties. Let us leave it there.

Recruitment: Ethnic Minorities

8. What plans he has to increase the proportion of recruits to the armed forces who come from ethnic minority groups. (900913)

The Prime Minister has made a clear commitment to have at least 10% of armed forces recruits from black, Asian and ethnic minority backgrounds by 2020. Increasing the diversity of our workforce is an operational imperative, which is why we have set up a diversity programme. Each service has developed a range of initiatives to achieve this aim. An increasing defence budget and the regeneration of our capabilities will be an attractive proposition to any potential recruit, no matter what background they come from.

Pendle residents have a strong tradition of service in our armed forces. I was pleased that the Duke of Lancaster’s Regiment exercised their freedom of the borough of Pendle in May with a parade through the town of Colne. Is my hon. Friend aware of any outreach work being done by our armed forces to ensure that we are recruiting from all of Pendle’s diverse communities, including our sizeable Pakistani heritage community?

I am pleased to tell my hon. Friend that a great deal is being done in the Pendle area in this regard. That same regiment also conducted an adventurous training event over a weekend in May with community leaders from Pendle and surrounding areas, including the chairman of Lancashire council of mosques. The Army will be holding a personal development engagement event at Burnley College and at the mosque in Nelson. As my hon. Friend is aware, the Army promotes regular and reserve opportunities at its annual jobs fair in Pendle, an event my hon. Friend has been instrumental in organising.


In addition to over 300 strikes, the Royal Air Force’s sophisticated intelligence surveillance and reconnaissance aircraft are making a crucial contribution—some 30% of the total intelligence effort—to the counter-ISIL coalition air campaign. We have trained over 1,600 members of the Iraqi security forces, and last month we announced that up to an additional 125 personnel will train Iraqi security forces in countering improved improvised explosive devices and in other vital skills.

It is clear that we need to defeat ISIL in Iraq and Syria, but will my right hon. Friend confirm that if and when further action needs to be taken, Government time will be allocated for a debate and there would be a vote in this House?

RAF intelligence surveillance and reconnaissance aircraft are already operating over Syria at the moment. As the Government have made clear, we will need to return to Parliament for approval if we propose to undertake air strikes against ISIL in Syria. ISIL has its command and control centres in north-eastern Syria, from where it is directing forces against the democratic Government of Iraq and from where it is planning terrorist attacks against the west, including Britain.

A key part of defeating and degrading Daesh is to destroy its propaganda campaign and not to give it legitimacy by calling it Islamic or a state. Will my right hon. Friend join middle east countries such as Kuwait, United Arab Emirates, Saudi Arabia and other countries such as France, Pakistan and Turkey by calling it Daesh?

Understanding the appeal of ISIL and its recruitment approach is a key focus of the coalition’s communications strategy. The term “Daesh” is now regularly used by Ministers in our Government and officials within the middle east and when engaging with many of our coalition partners. However, the term “ISIL” is still used when addressing UK audiences as this, at the moment, is better understood.

It is good that the Government have invited the Leader of the Opposition and my hon. Friend the Member for Gedling (Vernon Coaker) to tomorrow’s National Security Council meeting to discuss these important issues—and I very much welcome that. In the same spirit of co-operation and in the national interest, will the Secretary of State commit to a comprehensive, transparent strategic defence and security review with full parliamentary scrutiny?

We are committed to a full and comprehensive strategic defence and security review. It is already under way, and at Question Time last month I invited any Member to contribute to it, and we will invite other stakeholders with interests in defence matters to make a similar contribution.

Does the Secretary of State agree that this Chamber has a great opportunity to set an example by using the terminology “Daesh” on each and every occasion that it is mentioned here?

I note what the hon. Lady says. As I said, I use the term “Daesh” when I am in the middle east, talking to our partners in the coalition or the media there. Until now, ISIL has been the term that is better understood here in the UK, but it is certainly worth reflecting on whether we should now seek to move on to using Daesh, which does not confer the sort of legitimacy that the title ISIL—involving the word “state”—does.

Clearly, we all wish to see this country defeating terrorists and terrorism. Let me say again that they must not win and cannot be allowed to win. What assessment has the Defence Secretary made so far of the actions we have taken to defeat and degrade ISIL?

The coalition, which involves over 60 countries, about two dozen of which are taking military action, has been assisting the legitimate, democratic Government of Iraq in checking the advance of ISIL, and has had some success in pushing it back—in the recapture of Tikrit, for example, and in other areas up the Tigris and west along the Euphrates. This is clearly going to be a long campaign, however, and it will involve further necessary reforms in Iraq itself, including reforms of its army and the introduction of a national guard that can give the populations that have been liberated the confidence and security that ISIL will not return.

What the Secretary of State has said shows that this is a complicated picture. As I have said, we stand ready to work with the Government to defeat ISIL and will consider carefully any Government proposals for further military action, but will the Secretary of State reassure us that any proposals that he does present will have clear objectives in respect of defeating ISIL? Will he, in presenting such proposals, also make it clear what support will be provided by other countries in the region, and explain how the proposals fit in with the Government’s overall foreign policy objectives in the region and beyond?

I can give the hon. Gentleman that assurance, and I welcome the approach that the Opposition are adopting. We do not currently intend to present proposals to the House, but we have a strategy to help the Government of Iraq defeat ISIL, which we are pursuing in Iraq. We are also flying reconnaissance flights over Syria, and helping to train members of the Syrian opposition. As I think the hon. Gentleman implied, the situation in Syria is very different from and more complex than the situation in Iraq, and any strategy in Syria must properly reflect that.

Future Reserves 2020

11. What assessment he has made of the implications for his policies of the decision by the Major Projects Authority to give the Future Reserves 2020 programme a red rating. (900916)

My hon. Friend will have heard my earlier answer.

Since the MPA report, governance has been shaken up, with each service delivering its own programme alongside a defence-level enabling structure. My hon. Friend will know from many earlier answers that our improvements in recruitment, selection and training processes are bearing fruit. We remain committed to delivering the FR20 requirement.

The Minister will nevertheless know that the MPA declares as red projects that it believes risk being unachievable. Given the delays, cost increases and capability gaps, and given reports that superannuated reservists and those who do not regularly attend parades are remaining on strength, at what point will the Government consider scrapping their plans and increasing the size of the regular Army?

We recruited nearly 7,000 reservists across the three services last year. That was a rise of 65%, and the rise was even greater within the Army Reserve. As for my hon. Friend’s reference to superannuated reservists, I visited 3 Royal Welsh last weekend, and the average age of that battalion has dropped from 41 to 31 over the past three years.

Helmand Province

No decisions have been made about an inquiry, but we have been learning tactical lessons throughout our operations in Afghanistan. We will also want to look at the broader lessons that can be learnt from the campaign. However, combat operations have only recently ceased, and our focus remains on supporting the Afghan Government through NATO’s current mission.

Five of our brave British soldiers lost their lives in the first five years of the Afghan war. An additional 448 lost their lives following the decision to invade Helmand with impossibilist aims and a hope that not a shot would be fired. Do not the loved ones of the fallen, and the House, deserve to know the truth of what was a major blunder, certainly before we contemplate sending more troops into a four-way civil war in Syria?

I thank the hon. Gentleman for raising that important issue. The matters to which he has referred, particularly the incidents in 2006, have been the subject of a Defence Committee report, and I suggest that he read the report and the Government’s response to it. Along with the Under-Secretary of State for Defence, my hon. Friend the Member for Canterbury (Mr Brazier), who is the reserves Minister, I served on the Committee at the time.

Having recently returned from Afghanistan, and having spoken to some of the next of kin at the recent Para memorial, I would say that we have a legacy to be proud of. Afghanistan has never had what it has now. There are millions of people in education, including girls; there is a strong army and a strong police force; and economic regeneration is taking place. Although it has cost us much in blood and treasure, we have a legacy to be proud of in Afghanistan, and the United Kingdom is safer.


The Eurofighter Typhoon is a dynamic multi-role combat jet whose capability is continuously evolving. Tranche 2 and tranche 3 aircraft are now fitted with the Paveway IV bomb. Integration of the Storm Shadow deep-strike weapon is under way. The Meteor beyond visual range air-to-air missile and the Brimstone 2 precision effect missile will add world-class air-to-air and precision strike capabilities to the aircraft.

I thank my hon. Friend for his response and I am sure he and the whole House will join me in welcoming the Chancellor’s announcement that this Government are committed to spending 2% of GDP on defence. How will this improve our air force capabilities?

I am glad that my hon. Friend recognises the importance of the 2% commitment, and I welcome him to his place. We have successfully intercepted all potential incursions that have been shadowed by our quick reaction Typhoon aircraft and we can be confident that the Typhoon’s exceptional performance makes it capable of combating any threats sent in the direction of our shores.

20. Typhoon jets fly from RAF Coningsby in my constituency, as does the Battle of Britain memorial flight. Will the Minister join me in congratulating the RAF on a magnificent flypast last Friday of Spitfires, Hurricanes and a Typhoon to mark the 75th anniversary of the Battle of Britain? (900926)

I also welcome my hon. Friend to her place and she is right to highlight the importance of the magnificent flypast last Friday to mark the 75th anniversary of the Battle of Britain. I am very happy to join her in congratulating today’s RAF pilots on this fitting tribute to their predecessors in years gone by. These events highlight the bravery and professionalism of the men and women who have served and continue to serve our country so well. She might like to know that my hon. Friend the Minister for the Armed Forces will be visiting RAF Coningsby to congratulate them in person later this week.

National Security

17. What recent discussions he has had with the Foreign Secretary on the relationship between the national security strategy and the strategic defence and security review. (900923)

I have regular meetings with the Foreign Secretary as well as cross-Government meetings such as at the National Security Council, where we discuss a range of strategic matters.

Given the Chancellor’s announcement in the Budget to spend 2% of GDP on defence, can the Secretary of State tell the House whether the single intelligence account and the £800 million-worth of military pensions spending are now to be included as part of the defence budget?

I hope the hon. Lady will welcome the announcement last week that we are going to continue to meet the NATO target. If pensions are on the defence budget, then of course they count as defence expenditure, and they have in fact been on the defence budget for a very long time now. So far as intelligence matters are concerned, money that is spent on defence should properly be counted as defence.

Is it not sheer hypocrisy by the Government to criticise others on maritime patrols and investment when it is their party that has downgraded and stripped our defences to the bone, to the point that we now have no maritime defence, and NATO sea patrols have had to come in and look for alleged Russian submarines that have been dragging Scottish fishing boats under the sea?

We have plenty of maritime defence, but when we took office we had to end the Nimrod programme, which was years behind schedule and about £700 million or £800 million over-budget. Some 23 Nimrods were ordered back in the 1990s by a Conservative Government, but when we came to office 13 years later not one had actually been delivered.

The point is that since the Government scrapped Nimrod the UK has been without a maritime patrol aircraft, so may I gently ask the Secretary of State to confirm whether the next strategic defence and security review will contain a commitment to an MPA?

First, I should make it clear that we do, through other means, still have some maritime defence capability without maritime patrol aircraft, but we will of course look at a whole range of capabilities as part of the current SDSR which is now well under way.

Military Co-operation: Saudi Arabia

18. What recent assessment he has made of the effectiveness of the UK’s military co-operation with the Government of Saudi Arabia. (900924)

The UK has a long-standing relationship with the Kingdom of Saudi Arabia, which is a key strategic partner of ours. I spoke with its Defence Minister, the deputy crown prince, only last week. Our co-operation helps to keep Britain safe from terrorism.

At that meeting, did the Secretary of State highlight the fact that last year 90 people were executed in Saudi Arabia and that figure was reached by the end of May for this year? Sweden has dropped its memorandum of understanding on defence co-operation over the mistreatment of the Saudi blogger Raif Badawi and other human rights concerns. When will we see some urgency and action from the Secretary of State?

We do raise these cases at most senior levels with the Government of Saudi Arabia and we maintain a regular dialogue with them on a range of human rights issues. We strongly support the right to freedom of religion and belief. But let me be very clear: our relationship with Saudi Arabia is of long standing. It is based on a number of different pillars—trade, economy, education, defence, culture and security—and there is no other middle east country in which we have such a diverse and important set of interests to maintain.

Defence Spending

19. How existing and anticipated threats to UK interests will be taken into account (a) as part of the strategic defence and security review and (b) in future allocations of defence expenditure. (900925)

The SDSR will consider the broad range of threats we face, both now and in the future. The national security strategy is being reviewed and will draw on the latest version of the national security risk assessment. As my right hon. Friend the Chancellor made clear last week, this Government are committed to increasing the defence budget by 0.5% in real terms and meeting the NATO pledge to spend 2% of GDP on defence each and every year of this decade.

I thank the Minister for his answer. When considering the SDSR, we are all aware of the highly skilled workforce on the Clyde who are waiting to build Type 26 frigates. Can he explain what was meant by the article in The Sunday Times which stated that the Government would be “bringing realism” to this programme? What does that mean for the future of this vital project? Can he guarantee that there will be no further delays or doubts cast upon it?

My right hon. Friend the Secretary of State has already answered that question in response to a previous one. The workforce on the Clyde are currently manufacturing three offshore patrol vessels commissioned by the previous coalition Government. We want to make sure that before we enter the full manufacturing contracts, the contracts’ structures are robust and we can hold the contractors to account, unlike what happened with the aircraft carrier contracts, which blew up to more than double their original cost.

I am a great fan of my hon. Friend and my right hon. Friend the Secretary of State, but we need a little more clarity on the question of defence spending. Paragraph 2.22 of the Treasury Red Book states:

“The Ministry of Defence budget will rise at 0.5% per year in real terms to 2020-21.”

Given that the economy is growing at about 3%, can my hon. Friend tell me how we are going to meet the 2% commitment when there is to be only a 0.5% increase in the budget? Is it to be done by raiding other accounts?

I am very much aware of my hon. Friend’s success in securing a position in the private Members’ Bill ballot to introduce legislation on this very subject. I have the privilege of confirming to him and to the House that I will be answering those debates, so we will have plenty of opportunities to discuss this issue. The bald fact is that we are meeting the 2% commitment this year, and as I have just said, we will meet it each and every year of this Parliament.


Once again, this Government, in stark contrast to what happened during 13 years of the Labour Government, have not relied on a wish list of unfunded equipment projects. Instead, we have balanced the budget and committed to a real-terms increase in the defence budget. We will be meeting our NATO commitments, not just—I will say it once more—on spending 2% of GDP on defence, but on investing 20% of the defence budget on equipment.

Colchester is home to 16 Air Assault Brigade, the Army’s rapid response unit. Will my hon. Friend ensure that it has the best possible equipment to tackle the many challenges that we may ask it to face?

I am very pleased to welcome my hon. Friend to the House. He has a considerable military interest in his constituency, not least the 16 Air Assault Brigade. The new A400M Atlas air transport aircraft is being introduced to replace the C-130 Hercules fleet, and the third of those aircraft was delivered to the RAF last week. The ongoing development trials of the Atlas will mean that parachutists and their equipment from the UK rapid reaction force will be able to parachute from both sides of the aircraft and the ramp, and it will become the air mobility transporter of choice for rapid reaction forces—

Topical Questions

My immediate priorities are our operations against ISIL and the strategic defence and security review. Last week’s welcome announcement that the defence budget will increase every year and that we will continue to meet NATO’s 2% target means that we can now decide the capabilities and force structure that we need to keep Britain safe.

In 2013, an estimated 9,000 ex-servicemen were classified as homeless. Can the Minister update us on how we are getting on with that problem, and what the current statistics may look like?

The Ministry of Defence does not collect figures on homelessness. However, it is a matter that we take very seriously, and I would be delighted to look into the matter and get back to the hon. Gentleman.

T2. The Gloucestershire-based, UK-led Allied Rapid Reaction Corps is deploying on NATO exercises later this year. I am sure that the Defence Secretary will join me in wishing everyone involved, including my constituents, a successful exercise at this sensitive time. Will he confirm both that the NATO mutual military support clause is sacrosanct and never to be diluted and that this Government take a cautious approach to any suggested proposal of expansion? (900947)

Our commitment to European security, including to article 5, remains unwavering. We stand by the open-door policy, which allows any European state in a position to contribute to the alliance to apply to join. That process requires consensus among all 28 existing allies, and there can be no short cuts to membership.

Further to the question from my hon. Friend the Member for Kingston upon Hull North (Diana Johnson), will the Defence Secretary confirm that, according to the NATO definition, only intelligence operations in support of the military can be used to contribute to the 2% figure? Do the Government use that correct definition, and how much is it?

I was hoping that the shadow Defence Secretary might welcome the 2% commitment. Let me be very clear that it is for NATO to classify, according to its guidance, what is counted as defence expenditure. Money being spent on defence in our defence budget should of course count towards the 2% total.

T3. I welcome the additional training that my right hon. Friend announced last month for the Ukrainian armed forces. Will he tell the House what further support the UK is offering? Following the news that plucky Lithuania will become the first country openly to arm the Ukrainians, will he now consider providing anti-tank weapons, drones and other technology that the Ukrainian armed forces desperately require? (900948)

I can today update the House by saying that the RAF has now delivered more than 3,000 combat helmets, goggles and first aid kits to Ukrainian troops. We have already trained some 850 personnel. We will step up our training over the summer and we will be providing further equipment, although not of the lethal variety. We stand firm with Ukraine in the face of Russian aggression, and we continue to assist its defence of its sovereignty, independence and territory.

T4. The Minister will be aware of concern in my constituency about the implications of the expansion of the British Underwater Test and Evaluation Centre, particularly the threat of the closing off of the fishing grounds which would threaten the livelihoods of 70 fishing boats and 120 families in my constituency. Will the Minister tell us when the consultation exercise that we have long been promised will begin? (900949)

I am slightly surprised that the hon. Gentleman feels the need to raise this matter again, three weeks after his Adjournment debate in which I addressed those questions very directly. The consultation exercise is part of 200 defence establishments’ bylaws being consulted on—we will be beginning that later this summer. There is a separate exercise with the fishermen, who will not lose their livelihoods as he is suggesting, and that will be undertaken by QinetiQ shortly.

T6. Does my right hon. Friend agree with my analysis that the very welcome investment in both Typhoon and the joint strike fighter to provide the Royal Air Force with the best aircraft possible is a direct result of, first, a growing economy and, secondly, sorting out the basket case of an MOD budget that we inherited? (900951)

My hon. Friend lights on a very important point—that defence plays a part in the prosperity of this nation. ADS, the trade association, has estimated that some £22 billion of economic activity is attributable to the defence industry and it employs some 200,000 people in this country. The combat jet component of that is significant.

T5. Does the Secretary of State believe that after the invasion of Iraq and the intervention in Afghanistan and Libya, we have less international fundamentalist religious terrorism or more? (900950)

I believe that our contribution in Libya to preventing an imminent massacre in Benghazi, the work that we have done in Afghanistan, which my hon. Friend the Minister for the Armed Forces described, and our support for the legitimate democratically elected Government of Iraq have all been worthwhile endeavours.

T7. BAE systems at Samlesbury is about to hit another milestone with the manufacturing of the 200th aft fuselage of the F35. Will the Minister come to BAE Systems at Samlesbury during this period to see at first hand some of the most dedicated and skilled workforce in the United Kingdom? (900952)

My hon. Friend is right. As the only tier 1 partner in the F35 programme, the United Kingdom is playing a very significant role. Every aft section of every F35 is manufactured at Samlesbury in his constituency, providing high-skill jobs to many of his constituents. I am quite certain that I or one of my ministerial colleagues will have the pleasure of visiting his constituency soon.

T10. The Government have given a commitment to implement my party’s policy and spend at least 2% of GDP on defence. This target has been achieved by including the single intelligence account as defence spending. When might the Government meet the 2% target without cooking the books? (900955)

I have already made it very clear that no books are going to be cooked. Anything that is included has to meet the NATO guidelines. Where there is expenditure on defence intelligence which comes out of the defence budget, it is right that that should be included in our defence totals. The NATO figures will be there for everybody to see.

T8. Does the Minister share my concerns that a number of our ex-servicemen and women, having served our country with distinction, end up suffering from mental health issues, family breakdown and homelessness —yes, even on the streets of Dorset? What steps can be taken to help to prevent this? (900953)

Naturally, I want the very best for our entire armed forces community and I must emphasise that the vast majority of our service leavers make a smooth transition into civilian life. The Government have put in place a great deal of support for those who find the process difficult, including the allocation of £40 million to a veterans accommodation fund. The best evidence available suggests that the mental health of veterans is as good as that of the civilian population, but where problems do occur the highest standard of support is made available, and over £13 million from the LIBOR fund has been awarded to programmes.

I am sure the House will be as concerned as I am about reports that Daesh is now targeting Russian parts of the former Soviet Union as a recruiting ground. What action can the UK Government take as part of the international community to combat that?

A coalition of some 60 countries has come together to tackle ISIL in Iraq and in Syria, but the hon. Gentleman is right: ISIL is directing or inspiring terrorist activity in many other countries outside. That is why it is all the more important to ensure that it is degraded and ultimately defeated in both Iraq and Syria.

T9. Many of us in the House will welcome the commitment that the UK will meet the NATO defence spending target, but what assessment has my right hon. Friend made of the impact that this will have on our defence capabilities? (900954)

Defence capabilities will be determined in the strategic defence and security review, which is now under way, in the context of the threats we face at the moment and an assessment of the threats we may face in future. Those choices will now be framed and made easier by the Chancellor’s welcome announcement that the defence budget will grow for the rest of this decade by 0.5% ahead of inflation.

I trust that the Secretary of State was impressed by the extraordinary engineering he saw in Barrow shipyard last week. Will the delay in Artful’s exit have any impact on Successor? Will he join the shadow Secretary of State here on 21 October for our wonderful submarine manufacturing enterprise day, to which all Members of the House of Commons and the House of Lords are invited?

I think I attended that event last year, and I look forward to attending it this year if I am invited. I was extremely impressed by my visit to Barrow to see HMS Artful, the latest of our super submarines, as she prepares to sail. She will join Astute and Ambush to help to keep the sea lanes open and contribute where necessary to the fight against terrorism. I hope the whole House will wish her well. We expect her to sail in the next few weeks.

Will the Secretary of State confirm that there is no question of ordering fewer than 13 Type 26 frigates? How much would we fall short of spending 2% of GDP on defence if we did not include items of expenditure normally borne on the budgets of other Government Departments?

As I have made clear, it is ultimately for NATO to classify from each member’s return what properly counts as defence expenditure in the table that is published each year. As far as the Type 26 programme is concerned, my right hon. Friend will know that we have already committed nearly £1 billion to the design phase and to the purchase of some of the long-lead items for the first three frigates in the series.

Bidders in my constituency report a worrying picture of the Crown Commercial Service’s handling of defence procurement contracts, with unreasonable timescales, inappropriate specification, and tenders being issued and then withdrawn. What steps are being taken to improve matters, especially for SME bidders?

The Crown Commercial Service is run through the Cabinet Office, and we are in a long series of discussions with it about transferring commodity-type procurement from Defence Equipment and Support to the CCS. I believe it currently has nine separate categories of activity accounting for over £1 billion of our spend. We are regularly in discussion with it to ensure that its processes are as smooth and efficient for the supply to our armed forces as they are for the contractors involved.

The Secretary of State will be aware that hundreds of Syriac Christians have been murdered by ISIL in Syria. What discussions could he have with the Kurds to see what non-lethal assistance could be given to the Syriacs? Certainly, the Syriac Military Council has four battalions of men who are prepared to fight ISIL in Syria.

Syria is already the focus of our largest humanitarian aid programme. I have had regular discussions with the authorities in the Kurdish areas about what more assistance we could provide in training and equipment to the peshmerga, who are taking on ISIL in the north of Syria. Of course, our RAF surveillance aircraft continue to fly intelligence missions in that area.

What assurances can the Secretary of State give that military spending in Scotland will increase proportionally following the departmental increase outlined in the Budget? Between 2007 and 2012, Scotland received £1.9 billion less than its population share of Government defence spending on major projects. Perhaps he should stop paying lip service and take the opportunity to put things right.

With respect, I do not think it is lip service that, as I said, we have committed nearly £1 billion to building the next generation of frigates in Scotland. We are already building offshore patrol vessels in Scotland. Scotland is getting the bulk of the work on the two aircraft carriers. It will be home to one of our three fastjet fleets, and it will constitute the entire home submarine base of the Royal Navy. Scotland does very well out of the defence budget inside a United Kingdom.

While I warmly welcome the 2% of GDP we have committed to spending on defence, which is excellent news, we must not be complacent, because although the quality of what we are ordering is brilliant, for future events—perhaps, God forbid, a serious and more widespread conflict—we are still down on the quantity.

My hon. Friend is right. The SDSR that is now under way has to evaluate not merely the current threats to our country but the future threats that may emerge over the next few years. It is only by sorting out the defence budget—the mess that we inherited—and putting it on a proper footing that we are now able to increase it and to spend on the equipment that our armed forces need.

Parks and Playing Fields in Public Ownership (Protection from Sale)

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 require public consultation to be carried out in local areas where the sale of park or playing field land owned by a public body is proposed; to require referendums on such proposals in certain circumstances; and for connected purposes.

This Bill has come about in support of thousands of my constituents who are concerned about the proposed selling of a school playing field in Oundle at the site of what will be, in September, Oundle primary school. Recently, there has been a restructuring of the local education system that has led to a three-tier system becoming a two-tier system. In March this year, parents and the school’s governing body were shocked to learn that proposals had come forward for over 50% of the playing field to be sold off. At present, the playing field is well used by the school at breaks and lunchtimes, as well as for games lessons. It is also well used by local community sports clubs. I know that because, as I explained in my maiden speech, only two or three years ago my bowling was dispatched to all parts of the ground by an arguably very lucky batsman. Not only would local school children be adversely affected by this, but losing part of the playing field would have a dramatic effect on local sports clubs, including Oundle Town cricket club.

In response, a petition was immediately started by Julie Grove, a local Oundle mum, whose children will be directly affected by this sale. Then came the brilliantly organised Oundle recreation and green spaces group, who have got out there, spoken to local people and businesses, created campaign videos, and galvanised support for this campaign. I would like to give a special mention to the committee—Lucie Platt, Jo Trott, Paul Kirkpatrick, Ian Talbot, Tristan MacDougall, Jennie Grove and Christina Cork, under the excellent chairmanship of Julie Grove—for all their hard work to date on the campaign. As things stand, the petition has been signed by over 3,750 people, and the numbers are growing by the day. That is very impressive considering that the number of electors in the Oundle ward currently stands at 4,750. It is a very high turnout by any measure. This clearly demonstrates the strength of feeling from the local community, who do not wish to see the land sold off.

Local town councillors have also expressed their opposition to the sale, hosting a packed town meeting back in April. I would like particularly to mention district councillor Rupert Reichhold for his involvement in and support for this campaign. Interestingly, the site in question has not previously been identified for housing development, and nor, I am told, does it feature in the emerging neighbourhood plan that the town council is developing. With the Government’s planning changes, this would make it almost impossible to obtain planning permission on this land, although Northamptonshire County Council could still sell the land to developers.

Talking about the level of support brings me to the substance of my Bill. Despite over 3,750 local residents signing the petition, there is no obligation on Northamptonshire County Council to take that into consideration when reaching a decision; nor does it have any binding effect. With such overwhelming local concern formally registered, how can that possibly be right?

This comes at a time when we already suffer from a chronic lack of pitches in Northamptonshire. Indeed, I know of sports clubs whose members have to travel out of the county to play a home game. I want local youngsters to be able to play sport in the towns and villages where they live. When I was growing up, I was very fortunate to be able to play my sport locally. With that, came lessons for life—teamwork, respect and healthy living. Not everyone has the luxury of transport, which means that travelling out of the county is simply not an option and prevents them from playing for their local club.

While preparing my Bill, I did a bit of research and found that many right hon. and hon. Members on both side of the House have supported similar campaigns to protect local playing fields and parks in their constituencies. For example, only last week I talked to my hon. Friend the Member for Gower (Byron Davies) about his campaign in support of residents trying to protect local playing fields in his constituency. During my time as a councillor in Wellingborough, I remember the numerous conversations I had about how foolish it was for the site of the John Lea school to be sold off by the county council. The playing fields were also sold, with the result that we had a lack of school places and a lack of playing field provision.

I am aware that Education Ministers have real concerns about landlocked schools. That problem has been exacerbated by school playing field sales. Such short-sighted decisions then make it impossible to expand when housing growth comes, and that is a particular concern to residents in Oundle.

As I have mentioned, this is a truly national issue. Between 2001 and 2010, the total number of playing fields sold for development was 242. During the last Parliament, another 103 playing fields were lost. Interestingly, there are no national figures for parkland and other green spaces that have been sold for development. That could be due to the fact that there is no statutory consultee.

The irony of all this is that, although successive Governments have promoted the importance of healthy living and the role that sport and walking plays in that, we have seen dwindling open space to get out and get active. Indeed, when I was joined this morning on BBC Radio Northampton by Dr Richard Benwell from the Royal Society for the Protection of Birds, he made the point that providing every household in England with access to quality green space could save the NHS an estimated £2.1 billion in healthcare costs. Furthermore, these spaces are also lifelines for nature. With 60% of UK species in decline, public spaces are more important than ever for conserving British wildlife.

My Bill seeks to build on the localism agenda and the Government’s excellent measures for protecting assets of community value. The Bill would enshrine in law that a local authority wishing to sell off parks and playing fields must go through the process of a statutory consultation. One of the biggest complaints made has been that consultation on such sales nationally has been shockingly woeful.

I therefore propose that should a verifiable 10% of electors in any ward affected sign a petition, it will trigger a local referendum, of which the result will be binding. Essentially, that would provide a localist lock and ensure that the strength of local feeling is reflected in any decisions taken in relation to local parks and playing fields. In other words, it would be very difficult for the 3,750 people in Oundle to be ignored.

I particularly want to make the point that this Bill does not seek to stop the selling of parkland and playing fields per se; it merely ensures that those who use these important green spaces make the case for them to be kept. Of course, if a public body can demonstrate the benefits of selling any such land, such as alternative provision elsewhere as a direct swap or the introduction of better facilities, it has nothing to fear.

To my mind, not only is the Bill common sense, but it upholds the principle of localism and the big society. In the last Parliament, Ministers did much to progress this agenda, and I believe that the Bill advances the cause further. The Bill is about ensuring that local communities have a genuine say and a real opportunity to influence decisions about the future shaping of their area, because once these green spaces are gone, they are gone forever.

Question put and agreed to.


That Tom Pursglove, Mr Peter Bone, Byron Davies, Ms Gisela Stuart, Kate Hoey, Bob Blackman, Stephen McPartland, Mr Philip Hollobone, Zac Goldsmith, William Wragg, Simon Hart and David Morris present the Bill.

Tom Pursglove accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 23 October, and to be printed (Bill 53).

Ways and Means

Budget Resolutions and Economic Situation

Amendment of the Law

Debate resumed (Order, 9 July).

Question again proposed,


(1) It is expedient to amend the law with respect to the National Debt and the public revenue and to make further provision in connection with finance.

(2) This Resolution does not extend to the making of any amendment with respect to value added tax so as to provide—

(a) for zero-rating or exempting a supply, acquisition or importation;

(b) for refunding an amount of tax;

(c) for any relief, other than a relief that—

(i) so far as it is applicable to goods, applies to goods of every description, and

(ii) so far as it is applicable to services, applies to services of every description.

Just over five years ago, on Friday 7 May 2010, another emergency summit of Finance Ministers from across Europe was convened to save the economies of Greece, Spain, Portugal, Italy and Ireland from falling over like a row of dominoes. Here at home, unemployment was galloping away and had passed 2.5 million, 1 million more people than five years before. The Government had lost control of spending, spending nearly £150 billion a year that they did not have in the biggest structural deficit in the western world, which meant they had to borrow one pound in every four they spent. That very day, a note was waiting in the desk drawer of the Chief Secretary to the Treasury, telling his successor with brutal bluntness that “there is no money”.

The Cabinet Secretary had to intervene in the discussions between the political parties to impress on them the consequences of delay in forming a Government. As The Daily Telegraph reported that day:

“UK bond investors, facing huge borrowing demands from the Government this year, started selling…The fear stalking investors is that a delay in forming a coalition will set back plans to tackle Britain’s record Budget deficit, triggering a full-scale run on the pound.”

On that fateful day, in those dramatic circumstances, a Conservative-led Government did what history has regularly called on Conservatives to do and begin to pull the nation back from the brink of ruin after the disastrous denouement of a period of Labour Government. During the five years that followed, Britain’s prospects have been transformed, with the deficit cut by half, 1 million low earners taken out of income tax and spending on the NHS and schools safeguarded. More people are working than ever before in our history and Britain’s economy is the strongest growing in the western world. Thanks to the hard work and enterprise of the British people, our nation is on the rise again, but our task is far from complete. On 7 May this year, the British people looked at the past, looked to the future and asked us to finish the job. We are determined to repay their trust.

The Chancellor’s Budget puts our economic security first by cutting the deficit at the same pace as in the last Parliament until we have a surplus and ensuring that Britain pays its way in the world. It will help working people, support aspiration and boost productivity. It will reward work and allow people to keep more of the money they have earned. As the Chancellor said last week, the Budget is a new settlement for Britain.

Let me be frank: not every Budget goes according to plan. Some are cheered and others are jeered, such are the ups and downs of government, but it takes a special kind of genius to have an omnishambles Budget while in Opposition. I am sure that the whole House is eagerly awaiting the latest news from the hon. Member for Wolverhampton North East (Emma Reynolds) on whether the Opposition have a view on the Budget. Yesterday, the acting Leader of the Opposition announced that Labour would support the welfare cap and the restrictions on family tax credits, but within hours of her announcement three of the four leadership contenders—the right hon. Members for Normanton, Pontefract and Castleford (Yvette Cooper) and for Leigh (Andy Burnham) and the hon. Member for Islington North (Jeremy Corbyn)—denounced her and a policy that they had presumably agreed. We await the view of the hon. Member for Leicester West (Liz Kendall), but we have her representative on earth here—the hon. Member for Wolverhampton North East, who supports her campaign—and we want to find out whether the chaos is complete or partial. After the disarray of the last 24 hours, who could disagree with the hon. Member for Stoke-on-Trent Central (Tristram Hunt) when he said yesterday:

“The speed and rapidity with which we are beginning to be regarded as irrelevant…is really terrifying”?

We on the Government Benches have a settled view on the matters at hand. This afternoon, I will talk about two aspects of the Budget in particular: the opportunity that it offers to every part of the country to participate in our national success; and the imperative that it sets to move our economy to one of high productivity by addressing vital challenges, at the centre of which is building more homes.

I will give way to the hon. Member for Middlesbrough (Andy McDonald)—the Member for my home town.

May I tell the Minister what is truly terrifying? It is his Government’s proposal to introduce a two-child policy that will punish the most vulnerable and the poorest in our society. That is the terrifying thing about this Budget.

The hon. Gentleman can make that intervention in the parliamentary Labour party meeting later this afternoon, because I understand that that is the official Labour party policy.

Let me say a few words about devolution. As we recover from the recession and look to the future, it is clear that economic progress cannot come from London alone. One of the most striking achievements of the past five years is that the recovery has come from every part of our country. Businesses have created 2 million jobs over the past five years. Before 2010, only one in three jobs was created outside London and the south-east; now the figure is three in every five.

Where are exports growing fastest in the country? Is it in London? No, it is in the north-east, the home region of the hon. Member for Middlesbrough and myself. Where in England has the largest trade surplus? Is it London, or the south-east? No, it is the north-east again. Where is employment rising fastest? Is it in the south-east? No, it is in the north-west of England. For Britain to succeed, every part of the country must be firing on all cylinders.

That requires that we ask every city, town and county what they need to prosper. No two places are the same —Manchester cannot be confused with Margate, nor Newcastle with Newquay—so it should be obvious that a central plan for everywhere will end up working nowhere. For decades, however, that is exactly what central Government Departments tried to do; they prescribed blanket solutions for diverse local problems, which were enforced through unaccountable and expensive regional bureaucracies.

During the last Parliament, we made great strides towards reversing the failures of centralisation by devolving powers on planning, housing and economic growth. The Chancellor has already set out a bold vision for building the northern powerhouse, and this Budget will take us further.

I know that the right hon. Gentleman is committed to devolving powers to the regions. However, in the last Parliament Conservative Ministers made a commitment to deliver the electrification of the midland main line. Why will the Government not get on with that, because it would be good for the east midlands economy?

I share the hon. Gentleman’s view that that project is very important, and we are committed to it. However, to the regret of, I think, every Member, it has been necessary to pause it, to ensure that it can be done according to prudent budgetary principles. Nevertheless, the Transport Secretary has made it absolutely clear that such transport projects are very important for the hon. Gentleman’s constituency and others.

Did the Minister also welcome the news that BAE Systems announced last week that it wishes to take on 2,000 apprentices by 2018, which yet again reinforces the image of the northern powerhouse?

My hon. Friend is absolutely right; that is marvellous news and a reflection of the confidence in the economy of the UK and of the north-west. It also underlines the point that that is happening not only in our country’s big cities, important though they are, but in all parts of the north and, indeed, all parts of the country.

The Chancellor made it clear in the Budget that we have reached agreement with the 10 councils in Greater Manchester to devolve additional powers to them, beyond those powers that were devolved previously. A land commission will help to release public land to build new homes; fire services will be put under the control of the new mayor; and new powers will encourage further collaboration on children’s services and employment programmes. This historic process of devolution is now available to other cities and other parts of the country. The Chancellor made it clear that we are in active negotiations to devolve powers to the Sheffield city region, to Leeds, west Yorkshire and its partner authorities, and to the Liverpool city region. Each area will receive far-reaching devolved powers and resources in return for the election of a directly elected mayor. We are also in advanced negotiations with Cornwall on the first devolution for a county in this country.

This is just the start. The Cities and Local Government Devolution Bill, which is before the House of Lords, will enable us to negotiate with cities, towns and counties right across the country to give them the power that they need to galvanise their local economies. Such deals are in their local interest, but also in the national interest. At a time when limited public resources must be invested wisely, it is right to offer our cities, towns and counties a bigger share of the funding that is available. Why? Partly, it is because they have already demonstrated that they can make funding go further by managing it more creatively and attracting private sector investment.

I absolutely agree with my right hon. Friend about the importance of devolving power in the way that he describes. However, he will recall that it was a Conservative Government who abolished Avon, Humberside and Cleveland—those much-hated examples of regionalisation. Will he make a commitment today that, although devolution is a good thing, it will not become a substitute for regionalisation, and that if counties such as Wiltshire, for example, do not want it, we will not have to have it?

I can give that reassurance to my hon. Friend. That is the essential difference between the programme of devolution that we are offering and what has been attempted in the past. Every proposal will come from local people. I do not have the power, still less the inclination, to force local people into any arrangements other than those for which they are enthusiastic.

Will the Secretary of State explain to me and the residents of Greater Manchester how the devolved £6 billion health and social care budget marries with the £7.1 billion that is currently spent in Greater Manchester? What will happen to the residents of Greater Manchester when that money runs out?

The hon. Lady, who is a Greater Manchester Member of Parliament, should talk to her leaders in Greater Manchester who put the proposal to the Government. The proposal was not invented in Whitehall and visited upon Greater Manchester. The leaders of Greater Manchester made the very good point that when there is a strong connection between the needs of the national health service and the social care of residents across Greater Manchester, it makes complete sense for them to be managed together. That was their proposal and, in line with what my hon. Friend the Member for North Wiltshire (Mr Gray) said, we were very pleased to endorse it.

As I said, this is just the start. We want to build on the ingenuity and experience of local councils and civic and business leaders in an area to attract private investment to match the public investment. The city and local growth deals that we implemented in the last Parliament have transformed £7 billion of funds from central Government Departments into £21 billion of local investment. This Budget represents a golden opportunity for local leaders to repeat that success on a grander scale. Furthermore, with measures such as the creation of new enterprise zones, for which an invitation has gone out to places across the country, and the extension of the coastal communities fund, we are determined that this invitation should be extended to all parts of the country.

Would my right hon. Friend look favourably on an enterprise zone application for Morecambe White Lund and on a coastal communities investment, because Morecambe needs more money on top of the £1 billion that was delivered by the previous Government? I am sure that, with the Secretary of State’s help, we can do better.

I know from the last Parliament what a fighter my hon. Friend is for his area. I would welcome an application for Morecambe not just for an enterprise zone, but for the coastal communities fund—announcements were made on those two important policies in the Budget. I say to Members from all parts of the House that this is a big opportunity for them to work with the council and business leaders in their area to put forward a compelling bid for funds and, indeed, the devolution arrangements.

The Secretary of State is a most cerebral Minister, so I wonder whether he can help with a problem that I am grappling with. One way in which the north has competed with the south in the past has been through lower wages. I am not saying that that is right, but how will the living wage impact on it? When employers increase wages, they normally do so as a result of an increase in productivity. If there is a living wage imposed by the state, how will we avoid increased unemployment or lower productivity —or both?

I served my apprenticeship with my hon. Friend on the Public Accounts Committee, and partly as a result of the rigour that he imparted to the Committee’s members, I believe that the key to driving productivity is to invest in education and skills. One of the most important announcements in the Budget was the transformation of our apprenticeship system. There is a serious commitment on the Government’s part to ensure that all regions have the ability to invest in the skills that will drive productivity and justify the new wages.

In the proposals that places across the country have started to draft in response to my invitation to have more local arrangements, the common denominators are greater local involvement in skills and engagement with local employers. That is absolutely right, and I will back it in devolution deals.

I have listened carefully to what the Secretary of State has said about giving local people a say and not forcing areas to do things against their will. Why will the Government not devolve further powers to the north-east without a directly elected mayor, and why do they refuse to give local people a say on whether they even want a mayor in the first place? Will the Secretary of State listen to the north-east?

I listen to the north-east all the time, and I have met its civic leaders in recent days and will no doubt have further conversations with them. I have always had a strong and fruitful dialogue with them. In fact, I have a letter from the leader of the hon. Lady’s own council, Sunderland City Council, who said: “The support you provided to Sunderland was crucial to us securing the deal which is so vital in helping boost the economy of our area. Your thorough understanding of the issues in our region should be commended and demonstrates this Government’s commitment to putting the north of England at the heart of its plans to strengthen the economy of the whole country.” I have good dialogue with city leaders across the country, and the hon. Lady should talk to them.

I am conscious that many hon. Members want to speak, so I will move on and say a word about housing. I am convinced that our communities will rise to the challenge of devolution, but I have made it clear to authorities across the country that in doing so, they must deliver the homes that their people need for this generation and the next. Much progress was made during the last Parliament, which began with the lowest level of peacetime house building since the 1920s and first-time buyers locked out of the housing market. Housing starts and the number of first-time buyers have doubled since 2009 and are continuing to rise. Last year alone, the number of first-time buyers rose by 20%, but we must go further. That is why the Government are committed to encouraging home ownership and building homes that people can afford to buy.

There is a real desire in Corby for a new enterprise zone, not least because of the success of enterprise zones in the original wave back in the 1980s. We are also seeing enormous housing growth. Does the Secretary of State agree that the areas that are taking that growth should be rewarded when it comes to jobs and infrastructure?

I do agree, and I encourage my hon. Friend and his local business and civic leaders to make an application for an enterprise zone on behalf of his constituents. I am sure that that would further enhance the prosperity of the Northamptonshire economy.

I am grateful to the Secretary of State for his generosity.

What would the Secretary of State say to the 19,000 families in Islington who are on the waiting list for social housing about how long they might need to wait to be rehoused?

I would say to the people of Islington that they should be pleased that the highest rate of affordable house building took place in the last Parliament, and that we will increase that rate during this Parliament.

On that point, the Budget changed the future rental income forecast for social housing from the consumer prices index plus 2%, to minus 1%. The National Housing Federation said that that will reduce housing association revenue by £3.9 billion in this Parliament, and that a conservative estimate suggests a reduction of 27,000 homes being built because of measures in the Budget. How does the Secretary of State begin to justify that?

The justification is clear: over the past three years the rate of increase in rents for social tenants was twice that of private tenants. Since 2012-13 the increase in social rents has been 9.1%, and 4.8% for private tenants. It seems not unreasonable to reset the baseline—if I can put it that way—to reflect the experience in the rental sector of people in the country. I would be interested to hear from the hon. Member for Wolverhampton North East whether the Labour party will share our enthusiasm for the cut in rent for social tenants of 1% a year, when it has been increasing above inflation. It is an important move.

We want to encourage home ownership and build homes that people can afford to buy. We are extending Help to Buy, which has already helped 100,000 people to buy their own home. In autumn we will introduce the new Help to Buy individual savings account, and we will give more than 1 million housing association tenants the right to buy. The Budget and the productivity plan that the Chancellor published on Friday will free up brownfield land for development, speed up the planning system, and deliver thousands of new homes for aspiring homeowners.

The Secretary of State mentions the great productivity plan, but what a damp squib that is. It fails to address the key fundamentals of productivity, whether lending to business, raising intermediate and higher intermediate skill levels that are a major drag on our productivity, or other facets. Surely we deserve better than the damp squib that was produced on Friday.

I do not think that the hon. Gentleman has read the productivity plan. If he does he will find it a substantial document. That this early in the life of this Government there is a clear focus on ensuring that our country is equipped to prosper in the long term is a mark of the Government’s seriousness, and I am surprised that he disparages that.

The plan includes important planning reforms such as new transport hubs that many Conservative Members welcome, as well as new powers for the Mayor of London. There was, however, one glaring omission because there was nothing about permitted development rights, and many people are concerned about a policy that has helped to turn empty offices into family homes. When will the Government publish their policy on that?

My hon. Friend, who made a distinguished contribution as housing Minister, is right. Permitted development rights are important to bring otherwise disused spaces, such as offices, into use for homes. He will not have long to wait before we announce the continuation of those arrangements.

I am interested in the Secretary of State’s proposals to reform planning regulations, but will he look carefully at unintended consequences? We all want an increase in the number of homes being built, but we do not necessarily want to lose valuable employment land.

The hon. Gentleman makes a reasonable point in a reasonable way. He is absolutely right, which is why article 4 directions are expressly available to local authorities to make sure that land is kept for a particular use where it is important to do so.

Some of the proposals will be contained in the housing Bill this autumn and the House will have the opportunity to debate them. The Bill will create a new register of brownfield land to help fast-track the construction of homes, with the principle of development being agreed on 90% of suitable sites by the end of this Parliament. In London, I am pleased that my hon. Friend the Mayor will create an additional 10 housing zones, all on brownfield land. Those additional zones will bring the total number in the capital to 20, which, combined with the 20 housing zones outside London and the eight shortlisted areas that we have agreed to work with, could deliver nearly 100,000 more homes.

I just want to thank the Secretary of State and the Minister for Housing and Planning for their work in helping us to deliver those housing zones, which are enabling London to build more homes than at any time since the 1980s and a record number of affordable homes. In fact, in the next few years we are on target to build more homes in London than at any time since the 1930s.

My hon. Friend is right, and it is part of his record as Mayor of London of which he can be very proud. He and my hon. Friend the Minister met just before they came to the House to discuss the London Land Commission and further plans to build on the success that my hon. Friend the Member for Uxbridge and South Ruislip (Boris Johnson) has enjoyed. It is vital that we make sure that the capital has homes for the next generation of Londoners, just as he has provided them for this generation.

Local plans have been another success story, as they have helped to drive progress on both the quantity and quality of new development. In the productivity plan, we said that we want to take steps to ensure that there are local plans in every community. We will also make it easier to build 200,000 starter homes on underused commercial land, which can then be offered to first-time buyers under the age of 40 with a 20% discount.

We will update legislation and guidance to ensure that neighbouring councils co-operate on local plans—something that the Communities and Local Government Committee has taken an interest in over the years. The Chair was hopeful that I might listen to the representations from the Committee during this Parliament. We have listened and we are reflecting some of its thoughts in the productivity plan. We want to make sure that planning decisions are made as quickly as they can be; that major infrastructure projects can include some new homes as part of their plan; and that smaller firms have quicker and simpler ways of establishing where and what they can build, particularly on land in the new brownfield registers.

We also want to ensure that our existing housing stock supports working people, which is why the reduction in social housing rents—to bring them in line with the increase that has taken place in private rents—is an important step forward.

If I may bring the Secretary of State back to the importance of local plans, part of the problem has been that some local authorities have been slow in bringing forward their plans. I therefore support the Government’s moves to encourage local authorities to get their plans in place, because the Government will do the work if local authorities fail to do so.

I am grateful for the support of my hon. Friend, who has contributed to the Select Committee’s deliberations. Local councils have now had plenty of time to get on with their plans. More than 80% have published a plan, so we are pushing at an open door.

The Budget and its accompanying documents make clear, in tangible form, our commitment to provide the land and a simplification of the planning system to allow the homes that are needed to be built.

On the issue of brownfield sites, my constituency has areas that are heavily contaminated and need significant remediation. Can the Secretary of State advise local authorities and developers where they can get support for that remediation?

One of the benefits of devolving some of the powers and funds to local authorities is that by combining investment in transport infrastructure, housing and commercial development it is possible to get private sector investment in some of those regeneration projects. The hon. Gentleman has a valid point and, in recognition of the issue, we are establishing a brownfield fund that will help with the remediation of some brownfield land.

We have important themes in the Budget. It is an opportunity for our country to be even bolder over the five years ahead than we have been in the past. I am pleased that the shadow Secretary of State is on record as being a moderniser in her party. She supports a leadership candidate who says that she wants to challenge her party to be bolder. I hope that she will take the opportunity to do that. A vigorous debate on these matters—on housing, on planning and on furthering the devolution agenda—is very much to be commended in this House. Reflecting ruefully on the past five years, I found that I had a fruitful dialogue with leaders of local government, not just with Conservative leaders, such as my hon. Friend the Member for Uxbridge and South Ruislip, but with Labour leaders across the country, too. However, I did not, and they did not, get the support from Labour’s Westminster politicians. I hope that will change this time.

The hon. Member for Stoke-on-Trent Central, again providing wise words, said that this needs to be a summer of hard truths. That is good advice to the hon. Lady and I hope she will be bold. As the former shadow housing spokesman and now shadow Secretary of State, if she is not going to be bold, who is? Will she support tenants who dream of owning their own home, or not? Will she support our plan to build 200,000 starter homes? Will she back our register of brownfield sites with automatic planning permission so that builders can get on with building and young people can get a home of their own? Will she back our plans to extend home ownership through Help to Buy, right to buy and the starter homes initiative, or will she sit it out, a would-be radical afraid to speak out lest she finds that her leader is an old Labour figure who takes fright at confronting the future?

Britain has come a long way in the past five years, a journey that has taken us from the brink of ruin to the fastest growing advanced economy in the world. Confidence has returned and living standards are rising. Local economies are prospering and house building is on the rise. Businesses are growing and more people are in work than ever before. This progress bears testament to the hard work and sacrifice of the British people. It is their economic recovery and their hard-fought gains will not be squandered. Having come this far, there will be no turning back to the age of irresponsibility that caused so much damage to our country. The Budget sets out a new settlement for Britain to keep our country on the straight path to economic security and prosperity. It will give cities, towns and counties across the country the power to make their own decisions and to galvanise their local economies; it will help local communities to build the homes they need; and it will ensure that social tenants benefit from a fair rent. It is a Budget for working people and for one nation, so that whoever you are and wherever you live, you can benefit from Britain’s progress. I commend it to the House.

I welcome the opportunity to open the third day’s debate on the Budget on behalf of the official Opposition. I will focus my remarks on two of the most important long-term challenges that we face as a country: devolution and housing. First, however, I want to make a number of points about the Budget as a whole.

Last week, the Chancellor presented his Budget as a Budget for working people. Regrettably, the grim reality is that millions of hard-working families will be worse off as a result of this Budget. The Chancellor gave with one hand, but took away so much more with the other. Of course, we welcome action to tackle low pay. The minimum wage was, after all, a Labour policy and one of the proudest achievements of the previous Labour Government. We first introduced it in the face of fierce Tory opposition. More recently, we campaigned to increase it. Let us be clear about what the Chancellor has actually done. He has not introduced a national living wage; he has attempted to rebrand the national minimum wage. Admittedly he has increased it, but at the same time he has decimated tax credits, leaving 3.3 million families worse off and 500,000 families without any tax credits at all.

The independent Institute for Fiscal Studies says that the Chancellor’s claim that the increase in the minimum wage will compensate working people for the changes to tax credits is “arithmetically impossible”. For example, a working couple in full-time employment earning the minimum wage who have two children will earn £1,500 more, but will lose £2,200 as a result of the cuts to tax credits. Far from making work pay, the IFS says that the Government’s changes would

“reduce the incentive for the first earner in a family to enter work”.

In effect, what the Chancellor has done is introduce a work penalty.

As my hon. Friend the shadow Chancellor said last week, the Government are

“pulling the rug from beneath people’s feet while higher wages are not yet available.”—[Official Report, 9 July 2015; Vol. 598, c. 473.]

Young children in the families affected are likely to grow up to become poor adults, which is not only wrong and unfair, but will cost society more in the longer term. Yet again, this Government are hitting women the hardest, with women losing twice as much as men. Yet again, too, this Government are putting more of the burden of clearing the deficit on to the shoulders of young people. The Government seem absolutely determined to deepen and entrench the inequality in our country and the inequality between generations.

The hon. Lady’s acting leader, the right hon. and learned Member for Camberwell and Peckham (Ms Harman), has made very clear what she thinks about tax credits. Will the hon. Lady be voting in favour or against our reforms tomorrow evening?

Let me be absolutely clear. The Budget presented last week is regressive. It hits some of the poorest people in our country the hardest—people on lower incomes who are working hard and doing the right thing. We will vote against the Budget tomorrow, and that is why—because it is regressive and fails all the tests around productivity and all the big decisions on infrastructure that the Prime Minister and the Chancellor have been ducking for some years.

There were, however, some things in the Budget that we welcome. It seems that the Labour manifesto found its way into the Chancellor’s Red Box. I know the Chancellor likes to wear “high vis”, but I did not know he was into cross-dressing. From increasing the national minimum wage to abolishing permanent non-dom status and reducing tax relief for landlords, the Chancellor seems to be a late convert to Labour party policy. The overall test of the Budget, however, is whether it benefits working people and meets the long-term challenges facing our country. It is clear that working families up and down the country will be worse off, but let me now turn to the long-term challenges we face.

Will the hon. Lady confirm that even with the changes to working tax credits, they will still be higher as a proportion of gross domestic product at the end of this process than during any period of the Labour Government prior to 2004, and that at that stage there was no commitment to a national living wage?

I say to those on the Government Benches that they are simply out of touch with the lives of working people up and down this country. Of course we want an economy in which people are highly paid and highly skilled, but the course towards such an economy has to be charted before the support is cut off.

Let us deal with the crucial issue of devolution. We urgently need to rebalance our economy to drive growth and prosperity in all parts of the country. We are one of the most centralised countries in Europe. London dominates our economy, and its growth surpasses that in all of our major cities, which is not the case in either Germany or France where other cities beyond Berlin and Paris are true engines of economic growth. I agree with what the Chancellor said last week—that we will not achieve a better settlement by pulling London down. We should be proud of the dynamism and success of our capital city—and long may it continue. We must, however, reverse the long tradition of British politicians of all parties and of civil servants who have hoarded power in Whitehall and failed to trust local government.

There is a huge political and economic imperative to devolve power as close as possible to local communities. As ever, the Chancellor’s Budget speech on devolution was heavy on rhetoric, but rather light on substance. This Government boast about bringing about a “northern powerhouse”, but their rhetoric rings hollow, given that no part of the country has faced bigger cuts to local authority budgets over the last five years than those in the north of England. Indeed, the shelving of the electrification of the Manchester to Leeds trans-Pennine railway means that the Government’s plans are closer to a power cut than a powerhouse. We need a settlement for every part of the north, but as one of my hon. Friends pointed out to the Secretary of State earlier, there was barely a mention of the north-east in the hour-long Budget statement or in the 123 pages of the Red Book.

Ahead of the Budget, we know that there were briefings about which deals would be announced, and we know that the Secretary of State did what some might call a frenetic round of local government speed-dating during the Local Government Association conference two weeks ago. We welcome, for instance, the extra powers that the Government are planning to devolve to Greater Manchester. We also welcome the progress that three combined authorities—Sheffield city region, Liverpool city region and Leeds, West Yorkshire and partner authorities—are making towards a devolution deal, and the progress that Cornwall is making. As a Wolverhampton MP, I particularly congratulate the leaders of the local authorities that are working so hard to create the West Midlands combined authority. We are proud of the fact that Labour leaders in local government are making the weather on devolution.

While we welcome that progress, we also believe that the Government should not impose a one-size-fits-all approach to devolution, and should stop putting obstacles in the way. In his first major speech after the election, the Chancellor said that he would not impose the mayoral model on anyone, but in the very same breath he said that he would not settle for anything less. Why are the Government running scared of letting local people decide, and when will they clarify exactly what different areas and combined authorities can expect to achieve from devolution if they do not opt for a mayor?

I know that the hon. Lady has a good memory. Does she recall regional spatial strategies? What were they but an imposed one-size-fits-all policy from above? Has she forgotten that so quickly?

It seems from the details of the Government’s productivity plan, which were published on Friday, that the hon. Gentleman’s party is introducing a nationalised spatial strategy.

Our amendment to the Cities and Local Government Devolution Bill, which is being debated in the other place today, would ensure that areas that did not want a mayor would not get a second-class deal. A Labour amendment that was passed in the other place earlier this afternoon proposes the introduction of a “devolution by default” test for every new Bill that the Government introduce to Parliament. If the Government did not push down as much power as possible to local level, they would have to give and justify their reasons. I hope that they will agree to retain that new provision, because it will be a test of their commitment to devolution.

Like my hon. Friend, I strongly support the devolution of powers to Greater Manchester, but does she agree that not just devolution to the strategic city-wide level but devolution to the local level is crucial, given that many authorities in Greater Manchester are now struggling to deliver basic services?

I could not agree more. When we were in office we devolved power to the Scottish Parliament and the Welsh Assembly, but I know from our colleagues in Scotland that they are very disappointed that there has not been much devolution from the Scottish Parliament downwards. As my hon. Friend says, if we are devolving to combined authorities, we need to ensure that there is real devolution to communities as well.

The Budget also reinforced the Government’s piecemeal approach to devolution. We are calling on them to deliver a more ambitious and comprehensive devolution agenda to every part of the country—to all our cities, towns and counties. Doing a small number of one-off deals is not a one nation approach.

This Secretary of State is certainly better liked than his predecessor—[Interruption.] I accept that it is not a particularly high bar. It remains to be seen, however, whether he will live up to the reputation that he is trying to forge for himself. We hope that he will fight the corner of local government, but we will judge him on the outcome of the comprehensive spending review in the autumn, on the settlement that he achieves for local government, particularly in areas of high need, and, crucially, on the impact that any settlement will have on the vital public services on which people rely. Local government areas where more children are in care, where there are more vulnerable elderly people and where the needs of the local population are more complex and difficult are the areas where the Government have made the deepest cuts in the last five years. Let me say this to the Secretary of State: he cannot champion local government if he is impoverishing it at the same time. Devolution must not be a smokescreen to bring local government to its knees.

Housing is the other long-term challenge with which I want to deal. In our first debate in this House since the election I said to the Secretary of State, when debating the Queen’s Speech, that tackling the housing crisis was a key test for him and his Government. He agreed; he said it was an “issue of huge importance” and that this Government would

“build more homes in every part of the country”—[Official Report, 10 June 2015; Vol. 596, c. 1231.]

He even invoked the spirit of Harold Macmillan, but last week the Chancellor delivered a Budget that contained no proposal to tackle the housing crisis. Worse still—[Interruption.] Conservative Members should listen. Worse still, the Office for Budget Responsibility confirmed that the Budget would lead to 14,000 fewer affordable homes being built, which is contrary to what the Secretary of State said today. His desire to emulate Harold Macmillan appears to have been rather short-lived. If he thought that private house builders would compensate for his Government’s policies, he was mistaken, because the OBR says that it does

“not expect private sector house-builders to offset this effect to any material degree.”

Then there was the Government’s so-called pay-to-stay measure. I was interested to read that the Prime Minister had reservations about these proposals because he was not sure of the wisdom of describing people earning £30,000 as high earners. Indeed, these proposals would mean that a couple working full-time on the living wage would be classified as high earners, with a combined income of just over £30,000 a year. We have not seen the details of these proposals yet, but that couple could have to pay, on average, an additional £3,600 a year according to the Government’s own figures. Those who secure a promotion or more hours could thus be hit by this measure.

The details of this new measure are going to be interesting. Either we are going to have a cliff-edge where people suddenly start paying a lot more rent because they have earned a little more money, or we are going to have to bring in a taper system, which is another form of taxation. Does my hon. Friend agree that we will hav