Wednesday 13 July 2016
[Mrs Cheryl Gillan in the Chair]
EU Referendum: UK Steel Industry
I beg to move,
That this House has considered the implications for the UK steel industry of the outcome of the EU referendum.
It is a pleasure to serve under your chairmanship, Mrs Gillan. A number of Welsh Members are here today and, especially as you were previously the Secretary of State for Wales, I know you will take a keen interest in this debate.
Many of us have debated this subject in Westminster Hall and in the main Chamber many times, and we have tabled many questions. I lose track of the number of times that my colleagues and I have faced the Minister, but the facts remain the same. The steel industry faces immense challenges. There is a bright future for the industry, its workforce, its products and its role in our economy, but only if the Government take decisive action to respond to the challenges that the industry faces, which is even more important in the aftermath of the EU referendum. I argued a few weeks before the referendum that a vote to leave the EU would be a body blow to the industry, and I am sorry to say that the information I have had from producers, from UK Steel, from the Community union and from many others involved in the industry is that all the referendum has resulted in is yet more uncertainty and challenges for an industry that already faces significant difficulties.
The crucial question that I want the Minister to answer today, and indeed that many of my colleagues will be addressing, is this: what will the Government do differently—not only from their approach before the referendum, but in light of that decision—to offset the additional uncertainties, risks and challenges now facing the industry?
I congratulate my hon. Friend on securing this debate. He poses a question about the additional uncertainty and the Government action that is required. Is he aware that, as part of the reaction to the uncertainty, south Yorkshire-based Speciality Steels will be sold, fast-tracked and separately, despite the pause on the sale of Tata’s main strip business? He will have seen Monday’s written statement from the Secretary of State for Business, Innovation and Skills, which made no mention of whether the Government are willing to help on financing, energy costs or research and development support. One of the things we require from the Minister today is surely a commitment that the Government will stand by the pledges they have made to support steelworkers, steel communities and the future of steelmaking, including in south Yorkshire at Rotherham and Stocksbridge.
Order. Mr Healey, I remind you that interventions are supposed to be short.
My right hon. Friend makes a crucial point. The industry, its workers and all of us want to hear categorical assurances from the Minister today about action. We do not want to hear more platitudes and warm words. Particularly with the uncertainty, there is a real danger that the answer to our many questions will be, “We don’t know. Wait for the new Prime Minister and the new Government.” Well, the steel industry cannot afford to wait. It could not afford to wait before, and we now need real assurances. This is a matter of national significance.
It is a pleasure to serve under your chairmanship, Mrs Gillan. I warmly congratulate my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty) on securing this debate. He is rightly talking about securing concrete action from the Government. Does he agree that one idea would be for the Government to redouble their efforts to ensure that British steel is used in procurement projects, both in the supply chain and in headline contracts?
I absolutely agree. The fundamentals of this debate have not changed. It is about the action being taken on energy costs, on the UK steel industry’s terms of trade, on unfair dumping, on the additional risks now being created by the uncertainty about our future trading relationships and, indeed, on the crucial question of procurement.
I congratulate the hon. Gentleman on his work on this issue. Does he agree that an indication of the uncertainty is the announcement in Mumbai this week that Tata and ThyssenKrupp are now talking about a merger? That can only mean consolidation of the two plants in Holland and Germany. The Government need to step in and stop that merger.
I share the hon. Gentleman’s concern about the future of all the steel industry in south Wales. I have no doubt that we will shortly be hearing from my hon. Friend the Member for Aberavon (Stephen Kinnock) on that subject. Additional uncertainty is being created by the news that we have heard in the past few days, and I am interested to hear the Minister’s perspective.
It is now more vital than ever that the Government continue to work with us, with the steel industry, with the steel trade unions—particularly Community, GMB and Unite—and with other partners to instil confidence that we will all work together to create the right business environment, which particularly applies to the devolved Administrations. The Welsh Government, following their re-election and the reappointment of Carwyn Jones as First Minister, have reiterated their commitment to doing everything they can to support the Welsh steel industry. We want that co-operative relationship, which has been in the interest of the industry, to continue.
Crucially, the steel industry is a question for the incoming Prime Minister. Will she take the kind of laissez-faire approach that we have seen from the current Prime Minister? There is no industrial strategy, and his idea was that we should not be intervening—the series of interventions in the steel industry came quite late, however welcome many of the steps taken by the Minister herself have been. Will the new Prime Minister form a Cabinet that is going to take decisive action in the national interest? That is the fundamental expectation of people in the steel industry. We need a proper industrial strategy, and we need tough action, particularly in relation to the Chinese.
I have a number of questions for the Minister on the uncertainty created by the referendum, particularly on the different trade options that might be on the table and their many implications for the steel industry. Like many others, I would argue that retaining access to the single market is crucial. There is a Celsa plant in my constituency. Celsa is a European company based in Catalonia that has plants all over Europe. Almost 100% of its trade is within the EU, so if we lost the ability to trade in that single market on the kind of terms we currently have, the additional cost of punitive tariffs, or other tariffs, could be devastating.
We also have questions about the future of the state aid rules under any regime. Let us not forget that it was often suggested during the referendum campaign that, somehow, everything was the EU’s fault, but actually the EU has taken many steps to support the steel industry across Europe. The reality is that there are rules that would apply under European economic area and World Trade Organisation trading arrangements. What does the Minister have to say about the different options on the table? What would be the best one for our steel industry?
Other uncertainties might be created in any transitional period. Let us not forget that this is not just about exports. Raw materials are imported, whether it is scrap, as with Celsa in my constituency, or other raw materials. There could be an impact both on the steel industry’s inputs and its exports. The other implication is for exchange rates. Some would argue that the fall in the pound provides a benefit to the steel industry, but of course that benefit is potentially offset by the changes in input costs. I can see no positive net benefit from the current currency situation. Indeed, any short-term marginal benefit will definitely be offset by the much wider risks. What is the Minister’s perspective on that?
UK Steel, which has done an excellent job of representing the interests of the industry as a whole and is working together with the different producers, has made it clear that we need to remove the unilateral energy costs; increase the procurement of UK steel; address unfair trade provisions; provide funding mechanisms for energy efficiency projects; and set out a clear direction for the investment and support required by the industry in the long term.
One of the unilateral cost increases for the industry was the carbon price floor, which was a unilateral tax introduced by the British Government without any foresight. They then had to request permission from the EU to try to provide a compensation scheme. Post-Brexit, will the Government reconsider that measure in the immediate future to give more space to the steel industry on costs?
I absolutely agree. Given that the facts of our relationship have changed so substantially, what people want to know today is what completely new and different things the Government are willing to do with the levers they control, to respond to the wider uncertainty being created.
That is even more important because in a post-Brexit Britain the self-sufficiency and security of the steel supply is of even greater strategic and economic importance for our construction industry, our defence industry and all the other parts of our economy in which the steel industry and other foundation industries play such a crucial role. In any circumstances, the steel industry is of national importance, but with Britain going alone that will be even more the case, which is why we need that action.
I have already mentioned procurement. I am still deeply disappointed that we do not seem to have seen anything concrete. We have heard a lot of good words about the guidance that has been issued to Departments, but I have yet to see any concrete projects to provide certainty to the industry. When I asked the Minister for Defence Procurement shortly after we returned from the referendum recess, there were a lot of warm words but no clarity on which defence, construction or infra- structure projects are to enjoy increased supply of UK steel. Indeed, this is not just a responsibility of the UK Government. As we have discussed in this place before, it is deeply disappointing that the Aberdeen bypass, for example, is being produced using Turkish steel. This is the responsibility of all the devolved Administrations, as well as the UK Government.
As a Welsh MP I would do this, but I mentioned the support that the Welsh Government have been providing. Quite rightly, everybody is concerned about the Tata situation in particular, which I know my hon. Friend the Member for Aberavon will speak on, but the Welsh Government have made it absolutely clear that they are committed to supporting the sales process and the communities involved, and that they will continue to put every resource they can to that purpose. As far as I understand, their offer of support definitely remains on the table, but obviously there needs to be clarity on the bidders and the plans coming forward. I would be very interested to hear what discussions the Minister and her officials have had with the Welsh Government over the last few days.
There is a crucial broader point to make. We have seen discussions going on with the steel council and the various working groups, but I am concerned and would be interested to hear the Minister clarify whether those discussions and that dialogue have continued, whether the steel council and the working groups have met and whether her officials have continued working on it, or whether everybody’s attention has simply been diverted by the implications of the referendum and the switch in Prime Minister and Government. We cannot afford to be diverted. Diversion of attention for a few weeks or a month could be absolutely devastating. I would like some assurances from the Minister about what is happening.
I want to allow as much time as possible for other Members to speak, because I know many want to. Let me end by saying that we have all made the arguments before and we know what they are: they are on energy, trade terms, procurement and the wider business conditions. We have seen progress on some of those areas from the Minister—I acknowledge that—but not enough. This decision is so fundamental in changing the terms for this business and its future that we need to know what is happening that is new, that is different and that will give that certainty, reassurance and hope to the industry for the months and years ahead. As I said, this industry has a future. It can play a vital strategic role in post-Brexit Britain, but it will only do that if we see decisive Government intervention to ensure that it survives and is able to compete on a global stage. I thank you, Mrs Gillan, and every Member who has attended today to show their support.
Order. As you can see, many Members want to speak. I am entirely in your hands. If I impose an informal limit of five minutes on each of you, that will leave enough time for those on the Front Benches to sum up. But if I find that that is slipping, I am afraid I will have to impose a limit on the number of speakers.
Thank you, Mrs Gillan. It is a pleasure to serve under your chairmanship. I thank the hon. Member for Cardiff South and Penarth (Stephen Doughty) and congratulate him on securing this debate. I am sorry if I repeat anything but, as he said, we have all been repeating and repeating ourselves about the state of the British steel industry, certainly since I came to Parliament.
We have had good news in Scotland: we had a Scottish steel taskforce and the former Tata plants are now in the hands of Liberty Steel, which at the moment is recruiting for new workers. That is a fairly good news story from Scotland, but it is only thanks to the fact that the Scottish Government have put steel at the heart of their industrial strategy and have an industrial plan.
The situation we now face is probably one of the most difficult in our post-war history, and what we do now will have serious consequences for our future. The pound is plummeting and investment is going elsewhere. The experiment with an EU referendum to satisfy Tory Back Benchers has completely backfired and it is now apparent that there is no plan—not only no industrial strategy, but no plan for going forward with Europe. Where will the UK be in terms of its European status? Will we completely Brexit? Will we be part of the European Free Trade Association? What will happen? We do not know, but I know that there is a serious plan in Scotland and the First Minister is working tirelessly with her Cabinet and with Scottish officials to speak to European partners because, as we all know, Scotland voted to stay in and we want to be in Europe—we are European to our very core.
I want to completely refute what has been said about the Aberdeen western peripheral route. I can inform the Chamber that the subcontract for steel reinforcement was recently awarded to BRC, which is situated just outside my constituency and which is the UK’s largest supplier of steel reinforcement. The steel for that contract is produced in Newport; some of it requires cutting, and that process is undertaken in Newhouse, which has a postal address in Motherwell but unfortunately is not in my constituency—it is in the constituency of Airdrie and Shotts. Indeed, all steel for the Aberdeen western peripheral route project has so far been procured and processed from suppliers based in the UK. More generally, more than £350 million in subcontracts has been awarded for the Aberdeen western peripheral route project, of which £115 million has been sourced in Scotland itself.
I find that information very helpful, but will the hon. Lady say where the steel was actually manufactured—not where it was processed but where it was actually created?
Let me say that we do not manufacture steel in Scotland, but that goes back to when the Tories closed Ravenscraig in 1992. We roll steel in Scotland; we deal with plate. [Interruption.] The hon. Gentleman is chuntering from a sedentary position; I hope I can continue.
Order. He is indeed chuntering. If he wants to intervene, he must make it a lot clearer than that.
From the start of the steel crisis, the Scottish Government have exhibited tremendous leadership and collective decision making. That demonstrates what is possible when a Government have the will to intervene and have the interests of the workers at heart, but most of all when there is clear leadership and a coherent plan. Following the result of the EU referendum, it is entirely apparent that there was no plan from the UK Government for how to deal with a leave vote. In fact, we are still waiting for the change of Prime Minister today, and we still do not know who will be in charge of the business of steel next week, or even tomorrow. There are also real difficulties in the Opposition, who are still in-fighting rather than moving forward, but I pay complete and sincere tribute to those Opposition Members who have been fighting day and night for their constituents and their steel industry. I cannot say strongly enough what I have learned from them about how best to achieve things and move forward the steel industry in Scotland, half of which is based in my constituency.
No doubt the hon. Member for Aberavon (Stephen Kinnock) will speak on Tata Steel’s problems later. There are real issues there, and all this uncertainty is making the whole situation in Port Talbot much more difficult than it needs to be. I implore the Minister to try to move things forward and to actually make a difference to the steel industry. The Government have had to be pushed, prodded and shoved to get anything done, and there are still serious difficulties with energy costs, rates and all the other things that were causing difficulties a year ago.
I commend the Government, and the Scottish Government, for moving forward on procurement, which is essential and a real priority, but procurement is about the future. For steel in the UK overall, we need action now.
I am pleased to see the Minister in her place. I hope she is going to advocate and fight for us under the new Prime Minister.
Business needs certainty. Investment depends on certainty about access to the markets and about the stability of the currency. We need clarity on the timetable and process for Brexit. We need to know what sort of deal the Government intend to seek and we need very close dialogue between them and the steel industry so that steel companies know exactly what they are facing.
It is a particularly difficult time for the steel industry, so it is vital that steel companies are given every possible guarantee of support and confidence so that they keep the industry here in the UK. We need the Government to make safeguarding the steel industry a top priority. With all the uncertainty of the future—uncertainty about access to the markets and the price that we could have to pay for imported steel—it is vital that we keep our own steel industry here, both for security and to support our manufacturing industry.
Those advocating Brexit spoke of the opportunities it would offer to set our own conditions, but with that comes responsibility. The Government can no longer blame the EU. We need a Government who create the most favourable conditions possible for our steel manufacturers. They are now in direct competition with steel manufacturers around the world, so it must be made better for them to invest here in the UK than anywhere else.
We need urgent action on energy prices. As has been mentioned, the carbon floor tax could be dealt with straightaway. It was unilaterally imposed, but we then sought state aid to offset its effects. We can do something about that instantly, but more than that I support the request by my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty) for innovation. We need much more direct investment in innovative projects wherein the energy plant is linked directly to the steel plant, thereby keeping energy costs right down. We need Government help and intervention to make that happen.
We need speedy and targeted protection against Chinese imports. If we see that something is in direct competition with one of our products, let us act immediately so that we can protect our production lines. We also need much clearer incentives for research and development and for improvements to plant. We need a system of capital allowances and business rates that does not penalise plants that are trying to improve, increase their energy efficiency and be future leaders in their sector.
We need a really clear industrial strategy for the wider opportunities for the steel industry. We need to know exactly why we are producing the steel, what it is for and how it links into our manufacturing chain. In order to protect that chain, we need to keep steel production in the UK. We have heard warm words about public procurement, but we have yet to see real delivery. We need our supply chains to go directly into the projects that have been mentioned, many of which have not yet started.
I have particular fears for Tata Steel, which has a plant in my constituency, one in Port Talbot, and others throughout the UK. We are very worried indeed about what might happen in the talks with ThyssenKrupp. It is a very large conglomerate, and we have previously seen it decide that it just does not want to do certain things anymore and then pull out of certain sectors and close down all the factories. We have seen that happen with some of its car plants. I can easily imagine a scenario in which ThyssenKrupp simply hoovers us up, then closes us down and moves all its steel manufacturing to continental Europe. The Welsh Government will do their best to provide support, but I implore the Minister to make sure that it is an absolutely no-doubt decision for ThyssenKrupp to keep its UK sites open, or that we have other options to explore for keeping our steel manufacturing here.
It is vital that every potential obstacle is removed and that the best conditions are provided to encourage investment in our steel industry—investment for the future that will last. We need to ensure that we have a steel industry and a manufacturing industry, that we use our steel for procurement, and that we have the security of producing our own steel.
It is a pleasure to serve under your chairmanship, Mrs Gillan. I rise to support the hon. Member for Cardiff South and Penarth (Stephen Doughty) and commend him for the excellent way he introduced this debate on British steel. I wanted to add a contribution from a Member of Parliament from Northern Ireland. We do not have a steel industry in Northern Ireland, but we are very supportive of British steel, what it does, the jobs it creates and the fact that it is British. We are, of course, very much a British part of the United Kingdom of Great Britain and Northern Ireland and wish to continue to be so.
I have a couple of quick comments to make in the short time I have. A collection of economic factors causing negativity in the UK steel market have put increasing pressure on steelworks—I am well aware of that, as are other Members. Demand for steel in the UK has never recovered from the financial crisis of some years ago, remaining 30% lower than pre-2008 levels. Energy costs are a massive issue for us in Northern Ireland, as they are for the British steel industry. Business rates and environmental taxes have squeezed the industry that wee bit more.
We have also had problems with the Chinese steelmakers. It is estimated that they lost millions—indeed, probably billions—of dollars in 2015 as domestic demand slowed but GDP targets remained stubborn. As a result, steel exports from China to Europe have more than doubled since 2013, helping to send the price of the metal down to roughly half of 2011 levels. The EU could have introduced tariffs to address the problem, yet failed to do so. People sometimes say that tariffs are self-defeating, but I do not subscribe to that view. They can encourage our industry, and I believe we should introduce them. The US, for example, has a heavy tariff on Chinese steel imports of a whopping 236%. If the USA can do it, I do not see why we cannot do it here. Perhaps the Minister can explain.
Brexit is now over and the decision has been made. For the record, I was very much in favour of the campaign to leave the EU and I am very pleased that the people of the United Kingdom of Great Britain and Northern Ireland decided to do that. Let us move forward together collectively and positively to see what we can do for British industry. The problems with the EU were real. It would have taken all 28 member states to agree to a tariff, so it was never going to be a possibility.
Let us look at some examples of where problems still exist in Europe. Take Belgium, for example, home to—I say this facetiously—the circus HQ. The EU has called for Belgium to recover €211 million of state aid that was used to prop up the steelmaker Duferco, while an investigation has been launched into Italy’s support for Ilva. The Belgian support was considered illegal because
“you could not find a market investor that would give them the kinds of loans they got from the authorities”.
Belgium and Italy tried to do it, but the EU pulled them back. Now that we are out of Europe, we can be free of the shackles we once wore and move forward. There is an opportunity for the new UK Administration, under a new leader, to make the difference and make changes.
Surely if we stay in the single market in some way, shape or form, we will still be subject to its rules and regulations.
There is much to be discussed after Brexit, and that is one aspect. I am very keen for the debates to start. Let us move forward and be positive—the glass is half full. We are looking forward to supporting our industry and making sure that we can deliver for it.
Let us be positive and upbeat. We now have the power, at least in principle, for the Government to take the necessary steps to ensure that the 11,000 jobs at Port Talbot in particular are kept safe, as well as those throughout the whole United Kingdom, in Scotland and elsewhere. We have to remain positive and consider the new possibility of offering tailor-made Government support. Steel prices are rising, which means that Tata Steel will be in much less of a hurry to sell up and get out of the UK than it once was.
Let us give credit where credit is due: the Government have worked hard and the Minister has been industrious. She has responded to several debates and made very clear, positive comments. I know she is committed to British steel, but we need to see more practical changes. Although the pressure on Tata to sell has been reduced by the array of slightly more positive factors, it is imperative that the Government have in place the contingency plans needed for all possible outcomes.
It is encouraging to see the Business Secretary take such an active and positive role, but we must remember the livelihoods and families at stake. The deliberations on the issue, and the eventual strategies that are delivered, must deliver a British steel industry that succeeds and is here into the infinite future. We must retain the jobs and our position as a manufacturer.
It is a pleasure to serve under your chairmanship, Mrs Gillan.
I congratulate my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty) on securing this debate. He has been a strong and doughty champion of the steel industry. [Interruption.] Mrs Gillan, I’ll get my coat.
In my contribution, I will focus on the events and the circumstances regarding the pipe mills at Hartlepool. Last week, Tata announced its intention to sell off its Speciality Steels business, including the Hartlepool pipe mills but excluding the 20-inch tube mill. As we have already heard, this is happening in the context of Tata Steel looking to explore the feasibility of strategic collaboration with other European steel operators, perhaps with a joint venture.
In many respects, that is a positive move. The Hartlepool pipe mills are a profitable business unit within Tata. The Minister has seen the operations there for herself. She has seen that the mills have a skilled and committed local workforce that produce high-quality and value-added products for use in a variety of sectors, such as oil and gas, construction and infrastructure. It is little wonder, therefore, that several bidders have already shown an interest in buying Tata’s Speciality Steels business.
However, there is still uncertainty. A sales process of this nature is never straightforward, especially one where a part of a larger group is being divested, so what guarantees can the Minister give to ensure that we can continue operations at the Hartlepool site and that this sales process, which may be lengthy and complex, is concluded successfully?
The Minister has answered questions about this issue before; she knows its importance. However, it is vital that guarantees are given to boost confidence, not only among the workforce about their jobs but in terms of the order book, and in terms of customers and suppliers, to ensure that they continue to trade with the Hartlepool pipe mills; it is important to consider customers and suppliers, too. What can the Government do to increase confidence during this sales process?
In addition, what work has been done, or what assessment has been carried out, in respect of the Hartlepool steelworkers’ pensions? Will they be coming out of the Tata Steel pension scheme? It will be far more difficult to make a much smaller scheme, perhaps one based on Speciality Steels, a viable one. What work is the Minister doing with regard to the pension scheme? In this period of uncertainty, it would be very helpful if she could provide some sort of guarantees or confidence to allow this sales process to be carried out in a successful manner.
In the time I have left, I shall just touch on several broader issues; they have already been referred to in the debate but are incredibly important. There is still an unlevel playing field between ourselves and European operations. Energy costs remain a concern; there is a disparity in energy costs of something like £17 per MWh, even after the energy-intensive industries compensation scheme is taken into account. That means that UK steel producers and manufacturers face an additional cost to make steel, relative to their European rivals, of around £1 million a week. What will be done to level that playing field?
The second point that I will emphasise is the importance of business confidence and capital investment in the wake of Brexit. The vote on 23 June has produced enormous uncertainty, and as a result businesses—quite reasonably and logically—might want to pause their investment plans. They will think, “Let’s just wait until the next quarter, or the quarter after that, before we invest in new plant and machinery.” If we are in a global race for economic progress, we cannot afford to pause for a quarter or two; we will be left behind and consequently our competitiveness will be eroded.
What are the Government doing to ensure that the steel industry can be provided with as much clarity as possible? Can the annual investment allowance scheme, which has been excellent, be extended and widened? Will business rates be reformed? On the Business, Innovation and Skills Committee, we saw how illogical it is that manufacturers, such as steel manufacturers, are being punished by the Government. Manufacturers want to improve their competitiveness by improving their plant and machinery, but if they do so they will be slapped with an additional tax bill. That cannot be good economic sense. I know that the Department for Business, Innovation and Skills did not win the argument with the Treasury about this, but I ask the Minister and indeed the new Government to push further on it to provide the clarity that is needed.
My hon. Friend the Member for Cardiff South and Penarth has already talked about the importance of progress with procurement. Achieving such progress remains frustratingly slow. Government policy in this area was changed in October 2015 and again in April, which was welcome, but we need to see the new policy being translated into ongoing orders and activities for steel producers and manufacturers. I ask the Government to step up a gear, to ensure that the policy is not only changed but is active, energetic and vigorous in ensuring that local steel content can be used in all public projects.
This sounds flippant, although it is not meant to, but in many respects we no longer need to worry about state aid, so we can use this period as an opportunity to champion British steel and to ensure that we have a steel industry that is necessary and valuable for the economy, and that has a real future in the years to come.
Order. I am very pleased with the timekeeping. I think I have four speakers left and I hope to start the wind-ups at half past 10, so I hope those speakers will divide their remaining time up accordingly.
It is a pleasure to serve under your chairmanship, Mrs Gillan, and I congratulate my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty) on securing this timely and important debate.
I thank the Minister for Small Business, Industry and Enterprise for championing, in her own way, the steel industry. We have not always agreed and we have both been combative, but she has been the best champion and the best voice for steel within the Government, and I hope that will continue in some way in the new Government. The challenge that we face after the outcome of the European referendum is keeping steel up there as an issue to be addressed, so that it is not pushed out by other issues. We need to continue building the momentum to deliver a steel strategy for the UK—we have already started to build that momentum.
I was pleased that the new Prime Minister—she is not yet the Prime Minister, but she is incoming—has made it very clear that she believes in an industrial strategy. I very much welcome that commitment from her, but, as my hon. Friend the Member for Hartlepool (Mr Wright) has just pointed out, there needs to be an active and even interventionist industrial strategy that delivers for steel and for manufacturing. If she provides that type of strategy, I will be the first to lead the hurrahs for her.
In Scunthorpe, we recognise the bright future for the steel industry that my hon. Friend the Member for Cardiff South and Penarth talked about, because there is already a bright future in Scunthorpe, thanks to the work of Paul McBean, Ian Smith and Martin Foster, who are on the trade union side and who work with the leadership of British Steel locally. In fact, we were able to launch the new British Steel on 1 June and things are going very well. However, for things to continue to go very well, the steel industry needs the active support of the Government. Progress in a positive way will not just happen, and it will not happen at all unless the Government step up to the plate, which I hope is their intention.
The issues are well known—my hon. Friends have already referred to them. We need to do something about business rates. It is important that they are brought into line with those of European competitors. Currently, British Steel pays around £14 million per annum in business rates and the business rate system does not incentivise investment. In the modern age, that is madness and needs to be dealt with. Business rates for our capital-intensive industries need to be brought into line with those paid by their competitors, by removing plant and machinery from business rate calculations. The new Government need to do that urgently.
There are also electricity charges to consider. The UK steel industry pays double what the German steel industry pays for electricity, which increases its costs at every stage. Again, that needs to be addressed. Something needs to be done to tackle the high energy costs that still exist, either by innovation; by bringing production of energy closer to plants, which can be achieved by incentivising it; or by doing something else.
Much has already been said about procurement, which is vital for the steel industry. The procurement opportunity of leaving the EU needs to be taken advantage of and we also need to ensure that measurement systems are in place to ensure procurement of UK steel for public sector projects. I refer again to the opportunity for the development of offshore wind in the North sea, which is being led by DONG Energy. DONG Energy is being heavily incentivised by subsidies from the British taxpayer, so it would be outrageous if the steel required for that investment came from anywhere other than the UK.
We need to ensure that a pipeline of procurement is clearly in place. That issue must be addressed properly by the Government, so that we know what needs to be developed in terms of steel capacity, and so that we can ensure that the capacity is there in the UK to deliver for the future. That is what we need—a planning process to instil confidence, so that investment can deliver into the future.
I should mention the British Steel pension scheme, because it is incredibly important to my community. It needs to be addressed, sorted and given certainty so that the steel industry as a whole and pensioners in my community have confidence in the future. I would be very concerned if the impact of all the noise and the insistence on dealing properly with the challenge of the outcome of the EU referendum is to push aside the need for a sensible, solid approach to the British Steel pension scheme that puts it on a sustainable footing into the future.
I close by reminding the Minister, who has been a good Minister, that her final job in her role should be to drive things forward from whatever position she has and ensure that whoever succeeds her has the same passion and dynamism that she has shown from time to time and delivers for our steel industry.
It is a pleasure to serve under your chairmanship, Mrs Gillan. I also give heartfelt congratulations to my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty), who not only secured this debate, but has championed at every level the steel industry in his constituency and across the UK. I am very grateful for that.
The result of the EU referendum has led to unparalleled economic and political uncertainty. For the British steel industry, it has come at the worst possible time. We must not allow it to impede the work that has been done and still needs to be done to secure a sustainable future for steel. What steel needs has been explained to the Government time and time again: address the high energy costs; tackle business rates that continue to leave the industry hamstrung; commit to favouring British-produced steel in procurement; and act on the cheap dumped steel that has contributed to the severity of the crisis.
The Brexit vote may have reduced our ability to act, but we must commit to working with our European partners to ensure a co-ordinated and credible response. Tata Steel’s recent change of course in strategy for its British business in light of the referendum vote presents dangers and opportunities, particularly for Speciality Steels, which is based in Rotherham and Stocksbridge. It is a tremendous asset to the British economy.
There is an unfortunate tendency to view the British steel industry as a relic—an industrial throwback to a different economic age. That could not be further from the truth for the whole industry, but especially for Speciality Steels. Speciality Steels is a world-leading business at the cutting edge of technology and expertise. It produces steel for the most complex roles, from aerospace to motorsports. Members may have watched the British grand prix, where the cars had steel from Rotherham and Stocksbridge in them. The division’s list of customers speaks for itself, running from Rolls-Royce to Lockheed Martin and from Boeing to BAE. Rotherham also houses Tata’s research centre, which continues to develop world-leading advances in steel production and technology to meet the most difficult demands.
However, that vibrant and dynamic business cannot continue to lead the world with one hand tied behind its back. We must act on the underlying problems the industry faces as a whole. Tata’s announcement that the division is to be sold separately is cautiously welcomed. Speciality Steels is a great asset, and I am sure a number of bidders will be forthcoming, but we must make certain that the right buyer and not just any buyer is found to allow the business to continue to thrive. This can be no fire sale. I understand from press reports that there has already been some interest from potential buyers for the business. Given the new circumstances, I would appreciate it if the Minister updated us on the implications that the latest move by Tata will have on Speciality Steels in south Yorkshire.
Tata’s Speciality Steels unit could be a fantastic investment opportunity for someone. As well as producing some of the best steel in the world and being at the cutting edge of innovative and highly profitable steel products such as powdered steel, it has a highly regarded workforce in Stocksbridge and Rotherham. It will have a tremendous future with the right investment. Training and support for staff needs to be provided where necessary. Support to enable the business to weather any short-term turbulence that may result from the sale is also needed. What commitments can the Minister give to support the sale process of Speciality Steels and ensure that it is managed effectively and in a timely manner? The written ministerial statement from the Secretary of State on Monday hinted at providing financial support to help the process. Will the Minister provide details of any possible support? Also, will she place on record today that the Government stand by their commitments made on 21 April 2016, which detailed hundreds of millions of pounds of support in a package for potential buyers of Tata’s UK business?
Madam Gillan, another area of great concern has been the sizeable pension liabilities, especially the old British Steel liabilities. [Interruption.] Sorry.
Order. I quite like “Madam Gillan”. [Laughter.]
Okay—I ask Members to follow that.
Does the Minister envisage separate solutions for these liabilities? Can she give Members any details of what support the Government may offer any potential buyer of Speciality Steels? It is well known that, for Speciality Steels to maintain its dominant market position, significant capital investment is needed to move up the value chain. Can the Government offer any support or loans to potential buyers of Speciality Steels to ensure that investment in innovation, and in research and development, continues at its current pace or, indeed, is increased?
Speciality Steels has a bright future, and I am confident that the right buyer will quickly come forward. I know that the city region and Sheffield and Rotherham councils are determined to do whatever they can to help the business. The Government have repeatedly claimed to be committed to steel. That commitment must not slip, despite the economic obstacles we face. With the right support and nurturing, British steel can continue to lead the world in quality and technology with a dedicated, experienced and well trained workforce. The Government must not take their eye off the ball at this critical time. I join with my colleagues in urging them to act, and act now, to safeguard a viable, sustainable and successful future for British steel production.
I pay tribute to my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty) for securing today’s debate. I also pay tribute to the fantastic workforce of steelworkers across the country, many of whom are represented here with us today. It is an honour to have those gentlemen here.
The past few weeks have been characterised by uncertainty, particularly since the referendum result: economic uncertainty with the pound falling, investment put on hold and jobs at risk; party-political uncertainty; and governmental uncertainty and paralysis. That uncertainty has been particularly acute for the steel industry. When Tata announced on Friday that it was putting the sale of Strip Products UK on the back burner as it explored the possibility of forming a joint venture with ThyssenKrupp, the workforce and their families clearly reacted with a degree of scepticism and concern. The announcement compounded existing uncertainties. ThyssenKrupp has long expressed interest in Tata’s Dutch plant, but until last week there was no convincing evidence of any interest in Tata Steel’s UK operations. The central concern around the joint venture proposal, particularly with Britain outside the EU, is that the UK operations, including Port Talbot in my constituency, might not receive the support and investment they require. Clear assurances are required from the Government, Tata and ThyssenKrupp that the mooted joint venture will in no way diminish Port Talbot and the rest of the Strip Products UK division.
The uncertainties of the sale process have been compounded by Brexit and the resulting Whitehall paralysis. What we need now, on the day that a new Prime Minister enters No. 10, is a Government truly committed to the industry and its future. Like the Minister, I was a passionate campaigner for remain, but the British people voted to leave, and we must now deliver on and make the most of the mandate they have given us. To do that, we must urgently clarify the nature of our trading relationship with the EU27. I hope that the incoming Prime Minister will fully engage with the industry and parties on both sides of the House when determining the approach to Brexit negotiations.
The top priority is surely energy costs, which have been cited by leading figures in the industry as the No. 1 challenge facing British steel competitiveness. At present, there is a £17 per megawatt-hour differential between the energy costs for Germany and Britain, and that is after the energy compensation package is taken into account. Energy costs in this country are quite simply astronomical, and the Government should and must act.
At the Steel Council on 8 June, the Secretary of State was receptive to the industry proposals, with the Department for Business, Innovation and Skills and the Department of Energy and Climate Change pledging to come back with “urgency” on energy costs. Well, we are still waiting. Will the Minister do all she can, in whatever time she has left in her post, to expedite the process? What the industry cannot take is more delay and uncertainty. Steel is a foundation industry, critical to the houses in which we live, the offices in which we work, the cars we drive and the bridges we cross. It is the beating heart of economies and communities such as the one that I represent. That is why we need a resilient steel industry that can compete on a level playing field with our global competitors and that serves our entire economy and our communities. The referendum has compounded the existing uncertainties facing our industry, but that means the Government must act decisively and quickly. Brexit is a fact. The will of the British people must be enacted. If the Government act with purpose, we can make sure they work for the steel industry and for our communities.
It is a pleasure to serve under your chairmanship, Mrs Gillan. I thank my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty) for securing this important debate.
It is widely accepted that steel and the steel industry are essential to Wales and its economy, which is particularly the case for my constituency and the people of Neath. Tata steelworks in Port Talbot and Trostre are places where hundreds of my constituents go to work every day. As products of the industrial revolution, both coal and steel have been the beating heart of Neath for more than a century, defining its communities and those who have had their lives touched by those industries.
Of the 1,050 jobs lost in the UK steel industry since the year began, 750 have been lost from Port Talbot—and on top of the 400 jobs lost in 2014. The extent of this decline could have been slowed, shrunk or even prevented had the Tory Government taken up the offers of support that have come from Europe. The forerunner of the European Union, the European Coal and Steel Community, was set up not only to cement peace, but to help economic growth by pooling resources and preventing unnecessary competition. Such planning and collaboration saw the UK steel industry become world leading not only in size but in quality.
The latest industrial revolution taking place in China may be the biggest of all. In 2013, China produced 779 million tonnes of steel, or 48% of worldwide output. The UK produced 12 million tonnes. But as members of a strong European Union, we were in a position to embody the very reason for the EU in the first place: strength in numbers, collective planning, a common purpose. Had the UK Government allowed, we could have installed anti-dumping tariffs on Chinese steel. We could have lifted the lesser duty tariff and applied for crucial EU funds, which would have shored up the industry during these difficult times.
More than half of UK steel exports are to the European single market. What will happen to those exports as a result of the recent referendum? I fear that the impact of tariffs or an elongated trade agreement may signal the death knell of an industry already fighting to compete on a level global playing field. The UK steel industry has declined by 42% between 1990 and 2014 in real terms. Economic output in 1990 was £2.7 billion compared with £1.7 billion in 2014. How can we halt this decline without the support of our European partners, automatic access to a ready-made single market, or the potential of additional funding to tackle rising energy costs and environmental commitments?
We also have organisations that innovate and produce high-tech products that are changing the way we view steel. Neath Port Talbot is home to a company called SPECIFIC—Sustainable Product Engineering Centre for Innovative Functional Industrial Coatings—which uses Tata coated steel to make world-leading, innovative technologies that produce, store and release energy. SPECIFIC is hugely concerned about the prospect of leaving Europe, not least because of the essential funding it has received, without which it probably would not exist, but also because of the potential loss of a market where it could promote and sell its products. And let us not forget the steel that we import from the EU, which makes up 69% of our imports: it is not made in the UK, but is vital to many key industries that produce specialised products, infrastructure and new construction projects.
It is not a matter of whether Brexit will have implications for the UK steel industry, but the extent of them. Exports will be hit hard, output will be slashed, jobs will be lost and communities will be forsaken. I fear for the future of the UK steel industry in a UK outside the European Union, and I call on the Minister and the Government to do all that they can to protect it.
Thank you. We will now move to the wind-ups.
It is a pleasure to serve under your chairship, Mrs Gillan. I want to start on a conciliatory note and very much congratulate the hon. Member for Cardiff South and Penarth (Stephen Doughty) on securing this debate. I have spoken a number of times on this issue. I congratulate Members of all parties on the work they have done, including the Minister who has been working in very difficult circumstances. However, without recycling too many of the arguments, it is important that we focus on what we can do as a result of the Brexit vote. It is important to point out, as my hon. Friend the Member for Motherwell and Wishaw (Marion Fellows) did, that we voted differently in Scotland and are looking to protect Scotland’s place in Europe. Our First Minister, Nicola Sturgeon, and the Scottish steel taskforce have been working very hard on that, and I pay tribute to all the steelworkers across the country who have lost their jobs as a result of the challenges facing the industry.
Some Members have picked up on the issue of pensions. We have seen various businesses, including the likes of BHS, do significant damage to our reputation as a country in terms of what they have done with pensions. It is very important that the steelworkers have their pensions protected and that in any negotiations the Government are a great champion of that.
I want to bust a couple of myths that the hon. Member for Cardiff South and Penarth mentioned. My hon. Friend the Member for Motherwell and Wishaw rebutted the comment on the Aberdeen western peripheral route, but it is important to remember, as the hon. Gentleman and other Labour Members will, the tragedy of the closure of Ravenscraig and what that did. I hope the hon. Gentleman will recognise the shoulders on which he stands and the work done by Labour members in Scotland, by the SNP and those across the political spectrum who fought to keep that plant open, but were not successful. That plant, until it was closed in 1992 by a Conservative Government, was the largest hot strip steel mill in western Europe. It is because of that closure that we are not able to produce the kind of steel that we would like to. That is a great tragedy. I hope the hon. Gentleman recognises that.
As I said, I want to be conciliatory in this debate because a huge amount of work has been done. For us in Scotland, there was concern about the potential closure of the Dalzell and Clydebridge plants, which was going to cost us more than 270 jobs. However, the Scottish Government established the Scottish steel taskforce, which brought together people from across sectors: local authorities, trade unions, the UK Government, Scottish Enterprise and more. It is also important to note the involvement and engagement that the Scottish Government had with the unions from an early stage, by contrast, I am afraid to say, with the UK Government. The First Minister said at the time of the sale to Liberty House, which is to be congratulated on its involvement and enthusiasm in taking over the steel plants in Scotland, that if there was any learning and experience that we could share with Port Talbot, we would be happy to do so. I hope the hon. Member for Aberavon (Stephen Kinnock), who has been a significant champion for his constituency, will take up that offer.
The hon. Member for Llanelli (Nia Griffith) spoke about energy prices and the impact on her constituency. The hon. Member for Strangford (Jim Shannon), who is a regular feature and I believe one of the greatest contributors in Westminster Hall debates, spoke passionately. Although he does not have a steel industry in his constituency, he wants to offer support and takes a glass-half-full approach. It is important that we take such an approach. There are many issues and challenges and it will be interesting to hear the Minister’s view. We do not know how long she may have left in her current role, but how does she see the negotiations with Europe going for the UK and what kind of trade agreements can we expect to see? As we know, the pound has fallen, which means that UK steel will be cheaper to foreign buyers, and that could boost demand. On the other hand, a lower pound means that imports will be more expensive. Imported coal and iron ore are used in some of Tata’s UK operations, so that is a concern. I would be particularly interested to hear the Minister’s thoughts on what will be done in that regard.
I am very interested in the point that, theoretically, the fall in sterling in normal economic times would help exports. The big issue is uncertainty—uncertainty in economics is toxic. Surely now we need an urgent statement from the Government that we will go for EEA status, to preserve our status within the single market. That would be one way of securing investment in steel.
I could not agree more with the hon. Gentleman. He will know that joining the EEA and taking on those agreements would also include accepting the free movement of people. Most of us in the Opposition parties would agree that that would be positive, but, as we know, there are many on the Government Benches who disagree. This is a time of great uncertainty. It is simply unacceptable that there was no plan—as we read in the newspapers, things were thought about but not written down—and I think that everybody in British industry will be looking at that situation in shock.
The hon. Member for Rotherham (Sarah Champion) spoke about action on cheap, dumped steel and what can be done on tariffs, which a number of other hon. Members also raised. The hon. Lady also raised the issue of pension liabilities and her concerns for her constituents.
It would be remiss of me not to pay tribute to the work done by the unions and the devolved Administrations. Many workers are looking on, wondering what is going to happen to their jobs. At a time such as this, it is very important that we find consensus where we can. There will be differences of opinions and policies across the House, but we must work together to find consensus and to secure these jobs for Britain—to find a long-term economic and industrial plan, and to make sure that we secure as many jobs as possible.
It is a pleasure to serve under your chairmanship, Mrs Gillan, in this debate on an incredibly important subject. I congratulate my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty) and all my hon. Friends who have spoken in the debate. They have represented their constituents superbly over the last weeks, months and—in some cases—years to try to protect the vitally important strategic industry of steel.
I also congratulate the trade unions on their work representing their members and the communities that they live in, in these incredibly difficult times. We have seen examples of the benefits of partnership working between local politicians, the devolved Governments, local Government and the representatives of working people in those communities.
My hon. Friend is absolutely right to pay tribute to the trade unions and all those who have worked in partnership. Will he join me in paying tribute to the work of the Daily Mirror and its “Save our Steel” campaign? It has kept a focus on the issue, even today in the midst of everything else that is going on, to make sure that we all pay attention to what is happening in the steel industry.
My hon. Friend is quite right to draw attention to the fine work of the Daily Mirror. Its campaign has raised awareness among the wider public of just how important steel is to the whole country.
We express regret that the Government did not act in a stronger way to try to save Redcar and that there was not greater engagement earlier on Redcar and elsewhere, but we have to focus on where the steel industry is and what can be done now, not least given the challenges following the vote to leave the European Union.
Steel has faced a profound crisis for quite some time. Plants that had been in profitable production for decades have closed. In Redcar, that brought to an end a century or more of steelmaking on the site. For other plants, the potential changes of ownership have been the source of considerable uncertainty and, of course, Brexit has piled uncertainty on top of what was already a very worrying situation.
Britain’s relationship to the EU and the rest of the world is now more unsettled than it has been for many generations. We have seen the immediate impact of the vote not just in the steel industry, but in this industry we have seen the planned sale of the Port Talbot steelworks put on hold. An estimated 15,000 jobs are directly at stake, with another 40,000 immediately affected through the supply chain. Then there are the risks, which my hon. Friends have raised, from the impact on the British Steel pension fund—that threatens the prosperity of more than 130,000 workers, and of course there is the threatened loss of a vital strategic industry. The time is now for decisive Government action to secure as much stability and certainty as possible.
Before the leave vote, the Government had started to act and to recognise, quite rightly, the strategic importance of the steel industry in this country. That recognition had included the potential for the Government to take a stake in the Port Talbot works—the Business Secretary had dropped his previous opposition to responsible ownership and had, at last, understood the importance of Government intervention in industry. As part of any deal, however, he was proposing to switch the indexing of British Steel pensions from the retail prices index measure of inflation to the far lower consumer prices index measure. Over time that would have amounted to a 15% cut in pensions being paid, and, as well as affecting the prosperity of British Steel pensioners, it suggested opening the door to similar pension raids in other sectors.
The proposal has quite rightly been resisted by the unions and also, notably, by other Government Departments. Addressing the crisis in steel at the expense of pensioners is simply not acceptable. Supporting our steel industry will require the Government to follow best practice from north America and Europe, and to develop an effective industrial strategy to support the industry. It will require willingness from the Government to support the pension fund.
I apologise for not being here at the start of the debate. My hon. Friend talked about pensioners. Shotton steelworks is in my constituency, and there are a lot of pensioners because the steelworks used to be far bigger. Many still live in the area, so the change in spending power over time will affect not only them but the whole area. We have to think about that as well.
Absolutely. Any money taken away from pensioners affects the rest of the economy, including other businesses and the livelihoods of many other people. My hon. Friend is quite right that those considerations need to be carefully taken into account.
In his excellent speech, my hon. Friend the Member for Cardiff South and Penarth said that the vote to leave the European Union has been a body blow that has put uncertainty on top of the existing difficulties. I will remind the Minister of some of my hon. Friend’s questions. He wanted to know what the Government will do differently now and made the point that time is of the essence—the steel industry simply cannot wait for the new Prime Minister to take time to act. As my hon. Friend said, the Government need to continue working, and to step up that work, with local MPs, the devolved Assembly, local government and the unions. They need to move away from the laissez-faire approach we have seen in previous times. When my hon. Friend was making that point, the Minister was waving her hand dismissively, as she is sometimes wont to do. That is simply not the response that is needed on this critical issue.
My hon. Friend also said that access to the single market is essential. We heard in an intervention about the importance for Members of all parties of retaining that access. That is true not just for steel but for businesses in many other industries, too—not least those that are part of the steel supply chain, whether in manufacturing, construction or defence. We need to know what the options are for retaining that support. What action will the Government take to ensure that the supply chain will continue to be supported by UK steel production? What action will they take to ensure that raw material prices are not adversely affected, and that there is not the impact that my hon. Friend talked about?
My hon. Friend mentioned exchange rates and said that the benefits will be offset by import costs. He and a number of my hon. Friends mentioned energy costs. My hon. Friend the Member for Middlesbrough South and East Cleveland (Tom Blenkinsop) talked about the impact of the carbon price floor changes. We heard about the impact of business rates and the need for action on energy costs more generally. Will the Minister tell us exactly what she or her potential successor will do to take action on those points?
On the issue of procurement, the steel for the Aberdeen bypass—it was a £12 million contract—was made in Turkey, not Scotland or elsewhere in the UK.
I was not going to make any tribal statements, but the Western Mail, the national paper of Wales, last month exposed the fact that the Welsh Government have been using rebar steel from Germany for a road project—the Eastern Bay link road in Cardiff—less than a mile from where rebar is produced by Celsa in the Cardiff South and Penarth constituency.
That is the first I have heard of that.
You should read the Western Mail.
Unfortunately, the Western Mail does not find its way to Merseyside very often.
It is a fine paper.
I am sure it is a fine paper.
My hon. Friend the Member for Cardiff South and Penarth asked about the Steel Council. Will the Minister confirm what discussions are taking place and what work it is continuing to do after the Brexit vote? It has a critical role in the next few weeks and months.
I am conscious that the Minister has a lot to respond to, but I want to reiterate the importance of what my hon. Friend said. Government action is needed now. The steel industry, the workers, the supply chain, the businesses directly affected and the rest of the economy cannot wait weeks or months for action. Steel is crucial to our economy, our strategic needs and our communities. The Minister or her successor needs to make sure the Government do whatever it takes to save our steel.
It is a pleasure to serve under your chairmanship, Mrs Gillan. I do not know whether you have had the great pleasure of chairing a steel debate before, but I know that you have family connections in Wales. The majority of the speakers in this excellent debate are from Wales—a part of the United Kingdom that is very dear to your heart—so welcome to the gang. As you will have gathered, we regularly meet here or in the main Chamber to debate this issue with all its twists and turns. It is fair to say that, the last time we debated this issue, none of us anticipated that the next time that we gathered for a debate it would be on this subject.
I pay huge tribute, as ever, to the hon. Member for Cardiff South and Penarth (Stephen Doughty) for securing this debate. I will not have time to address all of the points that have been raised, but I will try to stick to the actual topic of the debate, which is the effect of Brexit on the steel industry.
It is right, good and fair to say—I am going to be a bit partisan here—that it is very much to the credit of my party that we have avoided the uncertainty that we undoubtedly would have had if we had waited until September to elect a new leader and install a new Prime Minister. That would not have been the best thing for our country or, indeed, our economy and our steel industry. We absolutely need certainty, and my hon. Friend the Member for South Northamptonshire (Andrea Leadsom) did everybody an enormous favour with her greatly courageous decision. We now have a new Prime Minister who can, frankly, get on and do all the things that need to be done to create certainty. She can answer many of the questions that I cannot answer, because this is a matter for the new Prime Minister and her Government.
In the words of the hon. Member for Aberavon (Stephen Kinnock), Brexit is a fact. It might hurt us but, as he rightly said, it is the will of the British people. At least we know where we are on that. We have a big task ahead of us, and I am sure nobody here is under any illusions about the scale of the complexity that we face as we withdraw from the European Union. It will take a number of years and it will be hugely complicated, but we are beginning. We will see stability and confidence return to the economy, and that will have a great impact on our steel industry.
The United Kingdom steel sector exported 6.3 million tonnes of steel last year, 3.3 million tonnes of which went to European Union member states. That is how important the EU is to the exporting of steel. Access to the single market is absolutely critical, not just for steel but for the whole of our economy.
The automotive sector has been a massive success story in recent years. We have exported a huge number of cars—many of which are made with British steel—to EU markets. I went to Nissan only the other week, and I was reminded that 45% of the steel that it uses is made here in Britain. That is the point that the hon. Member for Cardiff South and Penarth was making. I gently say to the Scottish National party and the Scottish Government that it is not just processing that is so important. It is also important that we buy British-made steel—steel that is made in Port Talbot or Scunthorpe, not Turkey.
It is important that we secure tariff-free access to the European market, not just for the steel sector but for the parts of our economy that buy British steel, such as the automotive sector. I have personally spoken to the important people at all the large automotive companies to reassure them and to tell them how critical it is that they keep putting in orders to Port Talbot, and they told me that tariff-free access is important for their sector.
The Minister mentioned the complexities following the referendum result for export strategy. What analysis have the UK Government done to date of the countries that UK-based steel producers export to? How many trade deals are now going to have to be renegotiated so those exports can continue?
I do not know about the actual figures, but we have looked at that with considerable care, and we will continue to do so. A special unit has been set up, and—if I can put it this way—will be beefed up by the incoming Prime Minister. Those are exactly the sort of issues and complexities that we are going to have to deal with.
Let me make it very clear that, until we actually leave the EU, we are a member of the EU. I think some people think we have left. Well, we have not left. We are still subject to all its rules and regulations—for example, the state aid rules—and we have access to the single market. Those things are incredibly important throughout the process that will now unfold. While we remain a member of the EU, we are subject to the state aid rules, the trade defence measures and so on. What replaces those rules—we may remain subject to them in return for market access—is for the new Prime Minister and her team to negotiate. Whatever my role is—I may end up on the Back Benches—[Hon. Members: “No!”] The worst nightmare of the hon. Member for Hartlepool (Mr Wright), who has been my hon. Friend on many occasions, is that I return to the Back Benches and then end up on his Select Committee.
I think we are all becoming demob happy. We are looking forward to next week when we will have a short break, but we will all continue, as we always do, to work for our constituents in the so-called recess. I think that other people sometimes forget that.
The Minister is making some good jokes; however, this is a very serious point. Although we are about to go into a parliamentary recess, it is absolutely crucial that the meetings with the Steel Council and the working groups continue and that the work with the officials goes on. We cannot afford to let weeks go by in the summer when the industry is facing so many challenges.
I could not agree with the hon. Gentleman more. He is absolutely right, and he needs to know that the Steel Council has been working as if nothing has happened or changed ever since the referendum vote. Indeed, the UK Metals Council is meeting now—that is where I would have been had he not secured this debate. Everyone involved in the sector needs to understand that the work of the Government, Ministers and my officials has continued through this recent period and, without doubt, will continue through the summer. If I stay in my job, he can be assured that I will continue to do everything I can to work for the best interests of our steel industry; if I have a successor, that person will do exactly the same. The officials, of course, do not change. Furthermore, the determination will be as instilled in the new Prime Minister as it has been in our outgoing Prime Minister.
To deal quickly with procurement, we changed the rules, and we were the first member state of the EU to do that, commendably so. However, Opposition Members make a good point about the need now to ensure real evidence that those rules are working. We need good reporting, so that we can come back to say that we are absolutely certain that the new procurement rules are producing the results we want.
Network Rail sources 98% of its steel domestically, or 145,000 tonnes over the next five years, and there is no reason to believe that that will change. High Speed 2 will need 2 million tonnes of steel over the next 10 years —forgive me, Mrs Gillan, but I am a huge supporter of HS2 and I fear our friendship will be wobbling here. I assure you and all hon. Members that I will continue to do everything I can in Government to make the case for wonderful and important infrastructure projects to be brought forward as much as they can be, as it will be a great boost for our economy if we can do that.
I have spoken with steel makers since the referendum, although it was not the result they wanted. It was sad that 69.6% of people in Hartlepool voted out; 60% of people in Cardiff voted in, but in Sheffield, 51% voted out; in Rotherham, 67.9% voted out; even in Neath Port Talbot, 56.8% voted out; and in the constituency represented so ably by the hon. Member for Scunthorpe (Nic Dakin), nearly 70% voted out. We all have a big, big job to do—but we can talk about that on another occasion. Only last week, however, I met British Steel, and things are going well notwithstanding—I do not want to be overly confident, but it is on track to deliver its business plan.
I want to deal with the point made by the right hon. Member for Wentworth and Dearne (John Healey) and by the hon. Member for Rotherham (Sarah Champion). Yesterday, I had a good meeting to discuss—freely—the situation in Stocksbridge and Rotherham. The Secretary of State has written in response to the right hon. Gentleman’s letter, although that reply might not yet have been received. For his and the hon. Lady’s benefit, the Secretary of State wrote:
“To date, no such requests have been made by any of the potential bidders, but we would be willing to consider requests that are made in the future.”
We know that people will be interested in the speciality steels, and rightly so, because it is a cracking business, with huge potential. Hon. Members can be assured that if we get requests to enable those sales to support that side of the sector, we absolutely will do it.
Will the Minister give way?
I will take one intervention, but quickly, or I shall be in big trouble.
I thank the Minister for giving way and for her response. May I ask her to thank the Secretary of State for his response, and to let her successor, if there is one, and his successor, if there is one, know that we as South Yorkshire MPs will be holding the Government to that commitment?
I did not doubt that for one moment, and I thank him.
The situation with Tata and the potential deal with ThyssenKrupp has raised several issues, notably that of pensions, about which hon. Members rightly have concerns. I have to say that the Opposition spokesman—this is a matter for the Department for Work and Pensions—did not make the most supportive contribution, but more than 4,000 consultees have taken part in the Government consultation. It will take time to go through all that, but the Government have always said that we will do everything we can to support the production of steel in south Wales, which means ensuring that at least one of those blast furnaces remains open.
As ever, the clock is against me, but the usual rules apply, and I will reply by letter to any questions that have been asked but I have not been able to answer. I again congratulate the hon. Member for Cardiff South and Penarth on securing the debate, and I assure him that wherever I am in the Government I will certainly continue to fight for the British steel industry to be sustainable and to continue making steel. I want to ensure that the case is taken forward, so we have that sustainable steel industry.
The hon. Member for Hartlepool looks as if he wants some reassurance, and he can have it. I have been to Hartlepool—I have been to almost all the steel mills throughout Britain, and apparently I will get one of those “I-Spy” badges as a result, if I come to the end of my tenure. It will be a proud moment, and I will wear it with great pride. Hartlepool is another viable business and, again, we will be there when buyers come forward. If they need support or want to talk to Government, we will do everything we can. Notwithstanding the referendum result, let us put some confidence back and say that we will create—or, rather, maintain—a sustainable steel industry. I will do everything I can, wherever I might be, to support it.
I thank the Minister for some of the things she said, which were confidence-boosting and provide some hopeful direction. We must all want to take her up on her suggestion—whether she is in the role or not—because that is a clear signal to send to her successor, if there is one, to the successor of the Secretary of State for Business, Innovation and Skills, if there is one, and to the new Prime Minister that this issue will not go away. It requires serious, concrete ministerial attention—not just officials—to drive it forward over the weeks and months to come. If we get distracted by everything else going on, the industry will face serious troubles.
I have three points to make, the first about energy costs, which the Minister did not get into in great detail—she is welcome to intervene, if she wants. We heard from my hon. Friend the Member for Aberavon (Stephen Kinnock) that figure of £17 per megawatt-hour differential between the energy costs faced here and across the EU. In particular, that is an issue for companies such as Celsa in my constituency, which operate throughout the European Union and see the energy costs in other countries. Perhaps the Minister will intervene or write to us, but I want to understand whether she would be satisfied for the differential to continue over any length of time.
I forgot this, but the hon. Gentleman makes a good point. A lot of work is still to be done on energy. A major target and piece of work for the incoming Government is to ensure that the steel industry—indeed, all the manufacturing sector—has a level playing field, and that must be achieved.
I thank the Minister for her comments, which I hope she will also express clearly to the Department of Energy and Climate Change, other Departments and the new Prime Minister.
On another fundamental issue, the debate was about the impact of Brexit and the referendum decision on the steel industry, and the Minister and other colleagues who have taken part in the debate today have outlined the potential risks if we do not get the right sort of deal. Access to the single market is crucial. Some have suggested that we should invoke article 50 straightaway and rush into the negotiations, but that would be foolish—I see the Minister nodding. Even some in my own party have suggested that, but it would be wholly wrong. We need to take a very careful approach, for the sake of the industry. The deal has to be the right one; we have to secure access for our exports, and to ensure that we do not end up with punitive shocks, because even if those were only in existence for three or six months in transition from one regime to another, they could be devastating to the industry.
To conclude, I thank all colleagues who have attended today, because it shows the great concern for the steel industry in Parliament. No matter what else is going on and that we are having a change of Prime Minister today; colleagues are still willing to attend and to stand up for constituents and the steel industry throughout the UK. I thank all those in the industry, whether in the trade unions, the management or the industry bodies, who continue to fight the fight and to make the case that steel does have a future, and that the Government need to act to ensure that future.
Question put and agreed to.
That this House has considered the implications for the UK steel industry of the outcome of the EU referendum.
Stevens-Johnson Syndrome and Toxic Epidermal Necrolysis
I beg to move,
That this House has considered awareness and funding for treatment of Stevens-Johnson syndrome and toxic epidermal necrolysis.
It is a delight to move a motion under your chairmanship for the first time, Mrs Gillan, and I am grateful to the Speaker for selecting this issue for debate. I am also grateful to the Minister and look forward to having a positive exchange with him.
I had never heard of Stevens-Johnson syndrome or toxic epidermal necrolysis—my pronunciation of some of these medical terms may leave a little to be desired—until my constituent Nadier Lawson, who had suffered from the condition, contacted me. She has set up an awareness group, SJS Awareness UK, which is based in my constituency. It was because of her and that group that I asked for the debate.
SJS—and its much more severe form, TEN—is a severe reaction that affects the skin. It is caused by a whole range of standard medicines that we all use regularly. The reaction is most commonly caused by drugs used to treat epilepsy; some antibiotics, such as penicillin and sulphonamides; over-the-counter drugs such as ibuprofen; and medications that are commonly used to treat HIV and gout. The adverse reaction triggered by those drugs is devastating. I have seen pictures of children and adults who have had such a reaction, and they are truly shocking. People start with a skin rash, which rapidly develops into excruciating blistering across their skin, which starts to peel off. The condition particularly attacks the mucus membranes in the body—in the mouth, eyes, nasal passages and guts—and is similar to having third-degree burns on the skin. The condition is classified according to how much of the body surface is blistered: if it is less than 10%, the condition is called Stevens-Johnson syndrome; if it is 11% to 30%, it is called overlap syndrome; and if it is over 30%, it is called toxic epidermal necrolysis.
The initial symptoms that people experience are non-specific. Someone can take a pill one day and feel nothing for up to a week or two but then start to feel unwell and develop a rash, which is often assumed to be chicken pox, and may experience flu-like symptoms. A key problem associated with the condition is that all too often, it takes far too long to identify. Obviously, the first thing to do is to stop taking the medication that is causing the condition. Failure to identify the condition early enough can lead to terrible lasting effects, including permanent damage to the eyes—resulting at its most extreme in blindness—and lungs, loss of nail beds, arthritis and chronic fatigue syndrome. At the very worst, people die. Around one in 10 people with SJS, the mildest form of the condition, and up to a quarter of those with TEN, the most severe form of the condition, die.
I have a whole lot of case studies, but I thought it worth reading out just one, which was given by a young man who came to an event that I held in the House to bring together people who had experienced the condition. He is called Stuart Doyle, and he wrote and said this:
“Nine years ago I had a TENS reaction. I burned from the inside out and lost around 95% of my skin, all through second and third degree burns with permanent scarring. My finger and toenails burned off and have never grown back. The enamel on my teeth burned away. Mouth, throat, lungs and stomach all burned. My eyes burned and ulcerated, then fused to my upper and lower eyelids. My tear film was destroyed, as was my tear production and I lost all saliva production too. I also had inner ear burning and am now partially deaf in one ear. My genitals burned.”
I will skip a bit and give just a summary of what he said and wrote. He continued:
“I spent six weeks in a ketamine-induced coma, which I was placed in just two days after I arrived at my first hospital. I arrived with what seemed to be meningitis, it was textbook and it was moving fast. Two days later my oxygen SATS had dropped to the point where brain damage had begun its process. They acted quickly; they had already started treating me, my son, and my partner for meningitis. It wasn’t until after the lumbar puncture results came back, that they realised it was not what they first thought it was.
The high doses of anti-biotics were stopped, by this point my throat and lungs had begun burning and blistering and a rash now covered more than half of my body. It was the lungs and throat burning that had begun to close up my airways and provoked the need for a ventilator to keep my brain intact. The ketamine-induced coma was to try and get my heart rate back down from the 180 beats per minute mark caused by the pain of the internal burning. If they’d not done that, I’d have certainly died from cardiac arrest there and then. I was to stay in the coma on full life support for six weeks; my total hospital stay was three months. I woke up in a different city.”
He goes on to describe how the condition has impacted his life, saying:
“I hoped I’d die, I wished every night for 3 years after my reaction that I’d not wake again. I had more surgeries than I can recall, my eyes were in a terrible state.”
This is the treatment that he requires today:
“My eyes require a tremendous amount of work. My day starts before 6am and ends around midnight. I have to change my lenses at least 20 times a day, put in more than 100 drops, both lubricants and steroids, and then there is the ever present pain. But, it’s totally worth the effort and I am so lucky, and grateful for all the work that my doctors put in to get me to here.”
He then says:
“The hardest thing about my new life, is the chronic pain”.
I congratulate the right hon. Lady on raising awareness of this issue. As far as I am aware, this is the first time that this condition has been brought to the attention of Westminster Hall and the Minister. The background information about the condition indicates that it can be triggered by normal medicines such as paracetamol. Is it time for the Minister and the NHS to address the issue by raising awareness of the condition among GPs, consultants and everyone else? The condition affects only one or two people in every million, but it is an important issue.
I completely agree. We are raising awareness through the debate, and I hope that the Minister will take action so we can get early identification and therefore prevent people from suffering the condition’s worst impacts.
The condition is rare, and therein lies the problem. I would appreciate it if the Minister addressed the following issues. There is a lack of awareness among many medical professionals, who just do not come across the condition. Insufficient attention is paid to the condition and its symptoms in the education and training of all health professionals. Survivors whom I have talked to all talk about that. A young man, Laurence McCalla, went to my local hospital, Queen’s hospital. They gave him antibiotics; it took about 24 hours to identify the condition. At one point he had 20 doctors and consultants looking at him, because it was new to them and they wanted to learn from it as a case study. Another lad, from Worcester, said:
“There is one big thing that stands out the most from this though. It astonishes me that so many doctors I have seen do not know about it.”
Debbie Hazel was misdiagnosed three times, as doctors thought she had chicken pox. She says:
“One of the problems was the lack of knowledge doctors have about the condition.”
The mum of a 13-year-old son, who lives in Surrey, says:
“My son was so ill and I couldn’t hold him or kiss him. He was screaming because his skin was so raw. I felt helpless. Nobody could tell us what was happening because nobody knew.”
My first ask to the Minister, therefore, is for a commitment that the condition, and its symptoms and treatment, should be taught to medical students, nurses and pharmacists as part of their educational courses. SJS Awareness, the organisation in my constituency, has a fantastic poster about the symptoms and how to spot the condition. Those posters could, if the Minister were to help us, be distributed to all GPs. Early diagnosis, and therefore awareness, would not just alleviate suffering; it would save lives.
Guidance has also been prepared on the clinical pathway by the British Association of Dermatologists. What steps will the Minister take to ensure that that guidance is followed throughout the country so that identification and treatment of the condition is not a postcode lottery? SJS Awareness has asked me to ask the Minister whether we could have an SJS awareness week for the general public. We are talking about such regularly used medicines—Optrex, ibuprofen, penicillin. They are standard medications, which we do not even think about using. We need to raise our awareness about the potential side effects.
Finally, because the condition is rare, money for research on it is limited. However, there is a cost to the NHS from not understanding the condition or recognising it early and understanding how to treat it. I understand the cost of treating skin reactions is about £500 million a year and it simply makes economic sense, as well as being a question of people’s lives, of course, to use research to get better at understanding why some people have such a reaction to drugs. An interesting key finding on genetic testing is that, in China, there is a gene in the population that predisposes people to different types of skin reaction, putting them at a higher risk from the drug carbamazepine. I do not know whether the Minister has come across that. In China and Taiwan, doctors test for the gene before they administer the drug. If we did more work here, we could manage that.
We also want research on new and better ways of treating severe reactions. From what I gather, more treatment should happen in burns units; often that is not understood and people are put into the intensive care unit and given the wrong medication. Finally, it is very important that we should have research on better understanding the features of drugs that make them more liable to cause the reactions in question. Those are three hugely important areas of research. I hope that the Minister can give us some comfort on that point.
People who saw the title of today’s debate would not have had a clue what I was going to talk about, yet the condition could affect any one of us, because we all take the medications concerned—they are standard. I have a file full of tragic cases of people affected by Stevens-Johnson syndrome, yet many people would not have a clue what we are debating. I ask the Minister, therefore, to do some practical things: to help us to raise awareness; to improve the training and development of all medical professionals, so that they understand the syndrome; and to get money for research so that we can understand the causes and prevent recurrences of this terrible condition in our population.
It is a pleasure to serve under your chairmanship, Mrs Gillan, not least because on other occasions you have been a doughty champion of campaigns on rare diseases. It is also a pleasure to respond to the debate. I congratulate the right hon. Member for Barking (Dame Margaret Hodge) on obtaining it and thank her for raising the issue. It is my great privilege as the Minister for rare diseases to be educated every time we have such a debate. A process of huge preparations is triggered in the Department, so already, just by raising the issue, the right hon. Lady has struck a blow and alerted the machine to the condition and its causes. However, I want to go further.
Perhaps, as this is the day when we say farewell to the Prime Minister, I may pay tribute to his personal leadership in the field of medical research, and to his unleashing of UK leadership, building on what happened under previous Administrations. The Labour Government did a lot of great work setting up the National Institute for Health Research, but because of the Prime Minister’s experience with genetic conditions in his family he has been an incredible champion of genomics and of rare disease science and research. As he leaves I want to state that that is one of his great legacies. It has been my privilege to be his first Minister for Life Sciences, with the purpose of driving forward that quiet revolution and UK leadership.
I also want to pay tribute to SJS Awareness. As with so many rare conditions, it is charities and patient groups, the patients and victims of diseases, who take the early steps in speaking up, raising money, rattling tins, having raffles and raising awareness, which in the end lead, as I see often, to huge progress and advances in research and treatment. I encourage them to continue and not to give up. I hope that what I will say will send a good signal.
The truth is that the debate on this condition shows up a wider issue throughout the biomedical research community. The more we know about disease and how patients respond to drugs, the more we realise how many conditions there are. We discover them literally each month through the UK genome project, at a faster and faster pace, and that is changing the way drug discovery works, and the way the system thinks of conditions. The old model of diagnosing on a standard understanding of X number of conditions with clear symptoms no longer holds. We must, as the right hon. Lady said, think about how we will help a new generation of clinicians to have at their fingertips the genomics, data and informatics to be able to recognise conditions and triage patients into the right treatment.
The Government take the issue of rare disease treatment incredibly seriously, and that is why we have worked with NHS England on launching the UK rare diseases strategy. There are now 51 recommendations. It is not just a brochure; it is a serious document with commitments and an action plan. Although the number of rare disease patients suffering from a particular condition may be small—the one that we are considering affects about 150 patients a year—collectively more than 3 million people in the UK suffer from rare diseases, so they are not rare; they are very common, and they are experienced by a huge number of people. It is only fair that the system should recognise that, and start to adjust and adapt towards the mainstreaming of provision for people with rare diseases.
Research is, of course, vital, which is why the £1 billion a year that we spend on the National Institute for Health Research, the £850 million for the Medical Research Council and the £1.4 billion spent by the Association of Medical Research Charities and its members is so important. That underpins UK leadership in this space, and it is even more important for rare conditions such as Stevens-Johnson syndrome. There are some encouraging research projects under way which I want to highlight, partly because I think they give hope to patients and charities.
The National Institute for Health Research clinical research network is supporting the MOLGEN trial. It is actively recruiting patients from across 80 NHS trusts who have experienced adverse drug reactions. That study has already recruited 1,740 participants and plans to continue recruiting patients until February 2019 with an eventual aim of accurately predicting those patients at risk of developing severe reactions, including Stevens-Johnson syndrome.
Further research that is likely to benefit those with the syndrome include the 10-year study of chronic eye inflammation, including SJS, which is being taken forward by the NIHR clinical research network in the west midlands. That has recruited 224 patients to date and will continue until 2021. The MRC Centre for Drug Safety Science at the University of Liverpool is doing powerful work in this field and has already been instrumental in identifying some of the genetic markers that indicate that a patient group are at an increased risk of developing the condition. The progress we are making in genetics generally, in terms of deep science, diagnosis and genetics for new cures, holds real hope. Being realistic, that is not hope for those patients who are in that excruciating agony that the right hon. Lady powerfully described in the words of one of her constituents.
While patients with SJS are more likely to be identified earlier and receive the best forms of clinical management, we want to prevent the condition in the first place by understanding the underlying genetic causes. That is why we are so committed to the 100,000 Genomes Project. For those who are not aware of it, it was led and inspired by the Prime Minister. I describe it as the NASA of UK biomedical research. It is our world-leading project to take 100,000 entire, fully sequenced genomes from NHS volunteers and combine them with phenotypic hospital data to form a global reference library for understanding the genetic predispositions for both disease and drug reactions. It is that combination of the living medical record of patients at scale with their genomic information at scale that allows us to understand those genetic mutations, which are often not associated with a particular condition so are not studied. When we have the whole genome at scale we can see, for example, the reason why 20% of patients respond to a certain drug in a certain way is that all of them have a genetic variation, which we had not realised, in a sequence that nobody had realised was associated with that disease.
Although we are only partially through sequencing the first genomes, we are already identifying extraordinary insights into rare diseases. I saw recently, when meeting the informatics team at Genomics England, a man who had presented with a rare blindness disease. It presents in teenage years with early onset blindness and can lead to mortality at around the age of 40. He has two young boys. He volunteered for the programme and the scientists quickly identified five possible variations that may have accounted for the condition, of which they were able to knock out four that had nothing to do with the eye. One was a pathway related to the eye and on that information alone they were able to recognise that that pathway is one that is implicated in the disease, for which there is already a treatment that is available at pence as a generic. With the patient’s consent they decided to try it and the drug arrested the condition.
That is an extraordinary breakthrough that was based on genomics simply allowing us to understand, initially quite randomly, how to prevent that condition, though we have not got a cure for it. We have identified in the haystack of the pharmacopeia of drugs one that has already worked. The genome programme is already identifying early treatments that are giving patients with rare diseases real hope. I am delighted to say that while the programme is a bit behind on the recruitment and sequencing of cancer genomes, for a whole series of operational reasons, it is steaming ahead on rare diseases. The UK is driving world leadership in that space. I was recently in Washington and met the White House precision medicine team, which is looking to us for a steer on how to use genomics to drive rare disease treatment and diagnosis.
To be specific about SJS, are there volunteers who have the condition, or relatives of volunteers who have it, in that sample? I do not know what is appropriate; I am not a great scientist, but that would seem to me to be a very useful way of progressing on this particular rare disease, though I recognise it is one of many. Does the Minister know?
The right hon. Lady read my mind. I do not have that information at my fingertips but I have already asked that question and I will happily ask Genomics England to ensure that she and I have that answer. I will touch on the point she made about awareness because I think there is an opportunity for us to use the genomic programme to trigger greater awareness among those who suffer from rare diseases, and possibly to drive up recruitment rates for the programme.
Let me touch on the NHS rare diseases advisory group, which recently noted that SJS is a devastating disease with a very high mortality rate, and endorsed the proposal for a highly specialised service for SJS and toxic epidermal necrolysis. The intention is for a nationally commissioned service to standardise treatment around the country in a small number of expert centres. Those proposals include a network of centres for both treatment and research and for using the diagnostic material to support that research. The establishment of a national service should make it possible to implement the national guidelines for patient care that were published by the British Association of Dermatologists just last month.
The Government absolutely recognise the long-term impact of SJS on survivors and their families. That is why we are putting not just research but patient support and a patient voice at the heart of the UK strategy for rare diseases. It is crucial that people who suffer from conditions like these are able to both feel that their suffering is not in vein and that they are being listened to and supporting research, and also that they are helping to drive new care pathways.
I will address the specific questions the right hon. Lady asked. She talked about lack of awareness and training. She is absolutely right that that is a major issue for our health system because the more we discover those rare diseases, the more we have a real challenge to keep our medical students up to date. In the old days we trained medics for the conditions that we understood but, because of the pace of discovery now, we have discovered new diseases that were not known when their textbooks were published before they have even finished a year at medical school. That is a challenge for the whole system and I will raise that important point with the relevant agencies who are in charge of training to ensure that they are address it.
I take that point but I draw to the Minister’s attention the fact that this disease was identified in 1922; it is not entirely new. Early identification means the drug that is causing the problem is withdrawn and the more appropriate treatment can be started. I hope the Minister can go a little bit further.
Many of these conditions have been known about for years, but it is only now that we are really beginning, through genomics and infomatics, to get a handle on how we might track, spot earlier and use big data to analyse cause and effect and develop new medicines that could intervene. Some of these conditions that have been thought of as never treatable are now becoming treatable because of the pace of biomedical progress. We need to inform our trainee clinicians not to think, “Well, I’m sorry. You’ve got a diagnosis; there is nothing we can do about it. People have suffered for 80 years.” There is a genomics programme, an accelerated access review for new medicines and an early access to medicines scheme, and we are beginning to accelerate getting new cures through into treatment. I will raise the issue of greater awareness of rare disease and what is available for them with the agencies responsible for training medical students.
The right hon. Lady raised the idea of an awareness week, which I think is an excellent idea. The truth is there are many rare diseases and I foresee a clamour for every rare disease to have a week, for which there would not be enough weeks in the year. It may be that one has a rare dermatological conditions awareness week, which would heighten awareness. There may be different ways to do that but her idea is first class. She also talked about money for research; she would not be doing her job if she did not. The Government spend a considerable amount of money on research. The NIHR has a policy of not identifying particular diseases and earmarking money to them but, following the debate, I will raise with the NIHR how much is being spent that would be relevant for sufferers of SJS. I know it is taking steps to amend its research criteria in the years ahead so that it is responding to the progress made in the genomics programme and others.
The right hon. Lady made an excellent point about gene testing. The reason I am so inspired by that quiet revolution is that we are now at a point at which we can start to gene test patients, profile them and get targeted medicines to them. That is already happening with cancer and some other diseases. For the new drugs we have launched in the NHS this year for Hep C, it turns out we can profile which patients will respond in six weeks, in eight weeks or in 12 weeks. That is driving a new model of reimbursement that sits at the heart of my accelerated access review.
Lastly, the right hon. Lady raised the important issue of side effects and the wider science of drug side effects, which the Government are investing in through a whole series of programmes in the Department of Health and NHS England. Understanding side effects can be a cue to the science of new cures. I hope she is reassured that we are taking that seriously and I will follow up—or will ensure my successor follows up, if I am no longer in post after today—the points she has sensibly raised.
Motion lapsed (Standing Order No. 10(6)).
Govia Thameslink Rail Service
[Joan Ryan in the Chair]
I beg to move,
That this House has considered the performance of Govia Thameslink rail service.
I had wanted to title the debate “The Woeful Performance of the GTR Service”, but the Table Office would not allow me to do so. Here we are—déjà vu all over again. It is no surprise to see on both sides of the Chamber so many hon. Members from south London and Sussex who have a close interest in this appalling state of affairs, which is continuing to deteriorate.
Southern Thameslink goes from bad to worse. It cancels more trains than the whole of the rest of the network put together. Our constituents are losing their jobs, parents are unable to see their children because they get home so late at night and students are missing lessons at schools and colleges, and in some cases missing exams, as a result of the woeful incompetence of this train company, and there is no end in sight. This is embarrassing, pathetic, unsustainable and a national disgrace for Britain’s largest rail passenger carrier. The management, the unions and, frankly, the Department for Transport should all be thoroughly ashamed that we are in this state of affairs. I would guess that it is the single biggest issue at the moment for most colleagues in the Chamber—it will be even bigger than the issue of Europe in some cases. We continue to be inundated by correspondence from frustrated, demoralised and understandably angry constituents.
Last Thursday, by way of example, I was going home in the late afternoon on the Brighton line. I arrived a little early for a train. I actually got a seat on a Gatwick Express train—several other trains had been cancelled. Within minutes, that train became absolutely cram-packed. There were people who had missed other trains going to Gatwick airport. They were going on holiday, going travelling. Before the train left, it was so congested that someone in front of me had a panic attack and had to be helped out of the carriage. I gave up my seat to a pregnant lady, and we had to look after her for the rest of the journey. Passengers were swapping stories: “What time does your plane go? You’re more likely to miss it than this other person.” The situation was absolutely horrific. It was unsafe, unacceptable and a real joke—but a very dangerous joke.
The hon. Gentleman may find this experience familiar. My constituent Lucy Cooper emailed me on behalf of her daughter, Ellie, who is a Govia Thameslink Railway customer—I use that word advisedly. Ellie described being so packed on a train that the person next to her fainted. The woman was fortunately not hurt, because there were so many people crowded around her that she could not even fall down. Is that not shocking in terms of the level of unsafe practices that are now arising?
I completely agree. I am sure all of us in the Chamber have similar stories and have had similar emails and letters. Gatwick airport is the gateway to the United Kingdom. Some 40 million people come to Gatwick airport currently, let alone if a second runway is positioned there. What an impression they get of the infrastructure in this country when they have to get on a train in those conditions!
I have with me many emails. One says:
“Yesterday I saw one unfortunate gentleman who became very poorly and distressed after having stood, squashed, for over an hour and a half in full city attire, an older American woman in tears and several hugely upset elderly people and little children who became panicked about the heat and crush.”
There are other people who do not get home until after 9.30 at night, having left the City at 5 o’clock. Someone missed his wedding anniversary. He ended his email to Southern by saying that
“frankly guys it’s not good enough.
Please, give up the franchise.
Please, don’t spend £6m on taxis for execs—please spend it on me.
Please, don’t keep blaming staff shortages—they are equally blaming you and it’s me (and my fellow commuters) sitting in the middle.
Please, remember—until you give up/lose the franchise—you are a TRANSPORT company. So please—transport people!”
It goes on and on. Another email says:
“At the end of the day it would seem to me that Southern and the RMT”—
the National Union of Rail, Maritime and Transport Workers—
“are acting like two spoiled children. Both have their positions and both are refusing to move at all, neither gives a damn about customers. It is the customer that is suffering in all this—it would not be so bad if we had any choice about the train operator that we use (in which case Southern trains would be empty I’m sure)—the fact is Southern have a monopoly and we have no other options.”
Time and again, we are getting emails like that, with no sign of the situation getting any better at all.
Does the hon. Gentleman agree that, although the current dispute has made matters markedly worse, in truth the reason why Southern should relinquish the franchise is that its performance has been lamentable over many years, not just recently?
Well, the franchise has not been going for that many years and of course we had all the problems supposedly attributable to London Bridge at the beginning of the year, when the situation was bad enough, but it has got hugely worse since then. I will come on to that in a moment—I know that many other hon. Members want to speak.
On Monday, to deal with the crisis, GTR introduced its emergency timetable. That came on the back of the increasing number of planned cancellations, presumably because it reduces the penalties that the company has to pay. It came on top of the loosening of the franchise agreement, which I read about in the newspaper. Hon. Members were given no notice by the Department for Transport or, indeed, the company itself. Given all the interest that had been shown by colleagues here today, one would at least have expected to have been forewarned about that by the Minister. That was, frankly, discourteous and disgraceful and has only compounded our anger with the way the whole dispute has been handled.
When the new emergency timetable came in, what was the result? Last night, I got the figures for the public performance measure for 12 July. With the emergency timetable and 341 planned cancellations—341 fewer trains running—the PPM was 77%; it was barely three quarters on the second day of the emergency timetable. The position was that 2,800 trains ran, 2,172 were more or less on time, 620 were late and 122 were cancelled or very late. The result of the emergency timetable is that there is less choice for customers and more overcrowding, but presumably fewer fines. Extraordinarily, Charles Horton, the chief executive, in his appearance before the Select Committee on Transport the other day, said:
“We expect to see crowding levels evening out because of more regular intervals between trains”
as a result of the emergency timetable.
What sort of weird logic is that? There will be the same number of passengers battling to get a train to or from work, but more inconvenience because of the timings and surely more overcrowding because there are fewer trains to convey them. The extraordinary complacency of that attitude is absolutely baffling.
Specific problems have been caused by the change in the timetable. I am sure that my hon. Friend the Member for Lewes (Maria Caulfield) will mention the suspension of the Lewes to Seaford line in other than peak times—there is a replacement bus service—which includes the cross-channel port of Newhaven, which does not now have a regular daytime train service. It includes one of my local schools. We actually had the platform extended because, with the number of girls from Davison High School in Worthing using that station to go to and from school, it had become dangerous. Now, the only train in the morning arrives at East Worthing station at 5.35 or 7.16, with no further trains getting there until 18:24, and there is a similar lack of trains going home. Therefore, a station that Southern rail expanded to cater for the increasing number of pupils using it cannot be used as a stop for those girls to go to and from school. The crisis that this is causing is absolutely crazy.
The company cancelled 341 trains as part of the emergency timetable. We are told in the briefing note from GTR:
“The number of trains cancelled in the revised timetable is 341 which is broadly similar to the number”
that were cancelled on an ad hoc basis to date.
That is fine: the company is just making it official that it is rubbish—that now it is part of the official timetable that it is officially very rubbish. It is extraordinary logic, and apparently the company has done that without even having to get the permission of the Department for Transport, or so the chief executive claimed at the Select Committee the other day. We would like to know from the Minister how this works. How is it allowed to do this and get away with it, and still have its franchise as the largest passenger conveyer in the country? What are we going to have next? Why does it not reduce the timetable to zero trains and then it would have 100% competence in completing its timetable? That is the logic of where this is going, such is the ridiculousness of the situation.
This is at the heart of the problem. I do not believe that there is sufficient deterrent or incentive on either side, for the management or the unions who are party to these problems, to find a resolution with any sense of urgency. All this time, it is the passengers—our constituents —who are suffering and losing out. We listened to Mick Cash from the RMT in front of the Select Committee going on about how, “We couldn’t possibly, for safety reasons, have driver-only operated trains,” despite the fact those already operate on 60% of Govia Thameslink services and 30% of trains on the whole of the network, and have done since 1985. It is not prepared to sit down and discuss that, and it is not prepared to acknowledge independent studies that have shown that there is not a major safety consideration.
Then we had the management of GTR saying, “We have tried to sit down with them but they are being unreasonable and they are all going off sick deliberately.” There may be some truth in that; they may be cancelling trains deliberately in order to worsen the situation. Frankly, my constituents do not care whose fault it is; they just wanted it sorted. There is, “He said this”, “She said that”, “He did this”, “They did that”—it is absolutely ridiculous. Somebody—frankly, it should be the Government—should get the two parties together and metaphorically if not physically bang some heads together and tell them to sort it or else.
I congratulate my hon. Friend on the way that he is dealing with this debate. It is clear from the statistics, which he will have seen, that the company is suffering from a very high level of real sickness. Clearly, there is something very wrong, or else it has a very sickly workforce. Does he agree that there are ways that sophisticated companies manage things like sickness? Would it not be better if the management of GTR took a great deal more trouble and were more proactive in dealing with the sickness problem?
My right hon. Friend is right. As somebody who has been even angrier than me in the face of GTR on occasions, he knows that there are solutions to this problem that have not been properly pursued. We are told by GTR that before the dispute happened approximately 21 conductors were off sick at any one time. Overnight, when this dispute came in, that almost doubled to 40, with spikes at three particular depots. Something is clearly up but there are things that GTR could do, whether genuine sickness needs sorting out or it is a form of unofficial working to rule.
I have been trying to get to the bottom of the finances in this whole crisis. In the Select Committee last week, Charles Horton said that GTR’s turnover amounts to some £1.3 billion, with just over 90% of that coming from the fee, paid by the Department for Transport, for running the franchise. The amount of fine—it is really difficult to drill down into exactly how much fine it has paid—seems to be about £2 million. Less than 0.2% of its annual revenue is having to be paid in fines as a result of the incompetent way in which it has run this service. Is that a real disincentive or penalty? I just cannot see how it is.
This is an unconventional franchise. I have tried looking at the franchise: all 668 pages of it. It is the only one in the country where the rail company is paid a fee by the Department and where all the revenue from passengers’ tickets goes directly to the Government. It is difficult to see who loses out when it goes wrong. When the network fails, there is a points problem, a London Bridge problem or whatever, Network Rail pays a penalty to GTR as the operator. That penalty is only paid on to the customer if they actually get round to the complicated process of the compensation payments, so GTR makes a profit, potentially, from problems on the network.
We read in The Times a few months ago—as I said, we were not notified by the Department—that GTR had been in breach of its licence and could have lost its franchise, but instead the Department agreed simply to loosen the targets for GTR, allowing an additional 9,000 trains to be cancelled a year without it being in breach of the reconfigured franchise agreement. These are my questions to the Minister. Exactly how much is GTR losing and what is the financial impact on Government revenue? How much compensation is Network Rail paying to GTR that is not then paid out to customers? What is the impact of the planned cancellations on penalties payable? My understanding is that when there are planned cancellations it does not have to pay the ad hoc penalties when trains do not turn up, do not start or skip stations or whatever. Are there financial implications for the loosening of the franchise and the introduction of this emergency timetable? What this boils down to is how much GTR and the Government have to feel financially pained before they do something urgently to resolve this crisis—and this is a crisis of great magnitude.
The Minister has the power to intervene on behalf of passengers and has made various statements. In yesterday’s Evening Standard she was quoted as saying that
“the real solution is for the RMT to end this dispute and the high levels of sickness amongst its members…we are working with TfL and issued a prospectus earlier in the year for new ways to improve services in the capital.”
That comes after the Mayor asked for GTR to be stripped of its franchise. The Minister has also said:
“Historically the Government doesn’t intervene in industrial disputes.”
But we are now told that a letter has been sent by the Minister to the unions offering some sort of deal. Perhaps she will comment on that and whether it is true, whether she is going to intervene, whether she can intervene and whether she is prepared to intervene. She has said:
“The union is holding commuters to ransom. Again if there was a legitimate safety concern or genuine job losses I would understand but this is a growing industry…This is not about job losses. This is about politics...What do you want me to do, get them in for beer and sandwiches?”
Frankly, that is not good enough and those sorts of sloganising headlines do nothing to get this problem resolved for our constituents. She has really got to get a grip.
There are many other problems as well. Back in January we had a summit in Westminster Hall. It was a very useful meeting. My right hon. Friend the Member for Mid Sussex (Sir Nicholas Soames) was greatly aerated. We enjoyed his interventions at the expense of the GTR management greatly; they were heartfelt and passionate and we all agreed with him. At that summit we had GTR, Network Rail, Department for Transport officials, MPs, Transport Focus and others—there were about 22 or so hon. Members, many of whom are in this room at the moment. We made it clear at that stage that this could not go on. At that stage we were primarily looking at the fallout from the problems with London Bridge, well before these additional problems came along. We were promised a follow-up summit six months on in order to assess the situation. Where has that gone? We have one week to go before the recess and there is no follow-up summit to get everybody together and hold their feet to the fire—in my right hon. Friend’s favourite phrase.
What really struck everybody at that summit was that the head official from the Department for Transport, when asked about taking back the franchise, got up and said, “Well basically, if GTR were not running this franchise—a very large franchise, a complex franchise—I would be the one responsible for it in the Department for Transport, and you don’t want that.” In effect, GTR was told it faced little prospect of us taking back the franchise because we cannot really run it ourselves. What sort of incentive was that for GTR to get its act together if it knows it can get even worse and even then the Government will not intervene and do something about it? I am really angry about this on behalf of my constituents.
I congratulate the hon. Gentleman on securing this debate and I absolutely 100% agree with him on behalf of my constituents that use East Dulwich, Peckham Rye and Queens Road. They will identify completely with the level of total exasperation and frustration. He has diligently gone through all this and has done all the right things, but his constituents’ situations are simply getting worse and are set to get worse still, with disruption to family and working life and downright safety issues. I simply lend him my support and say that my constituents are every bit as desperate as his. We have no tube and we have congested roads, so they cannot go by bus. People cannot lead their lives like this. I agree with him that GTR should be stripped of the franchise.
I am grateful to the right hon. and learned Lady for that short intervention. She echoes the words of so many of our other colleagues who could not be here, including my hon. Friend the Member for Worthing West (Sir Peter Bottomley), who texted me to tell me that he was stuck on a train somewhere, otherwise he would have joined our deliberations.
Many other problems affect this railway; it is not just the unreliability of when the trains actually run. There is overcrowding, safety is an issue and, at the same time, Southern is trying to close down all our ticket offices. It has only given a temporary moratorium on that—what a stupid thing to do. When the company cannot even run the service, it tries to threaten the easiest way of selling tickets for it. We have the antiquated rolling stock on the west coastway line—the class 313 rolling stock is 40 years old, and has no loos or any other basics. Female constituents have real problems when stranded late at night in stations far from home because a station has been skipped or the last train has been cancelled. It is not just inconvenient; there is danger attached as well.
I see that just two of us are here from the northern side of the Thameslink line. Is my hon. Friend aware that yesterday, the 7.34 am Brighton train from St Albans, which was a brand-new train—one of the class 700 stock—broke down, so this is not just about old rolling stock, but about new rolling stock?
I fear that that is right. Again, we were promised that everything would be so much better because of the investment in rolling stock—that it is all coming in and it is all going to be fine.
Finally, there is the issue of compensation. We are constantly told by GTR, “We have this compensation scheme, which is not easy to administer,” but the amount of compensation that people are getting back for the huge amount of aggro that they face is paltry. Frankly, my constituents are not primarily interested in compensation. They just want a reliable service with a better than evens chance of them being able to turn up at the station and get on a train at about the time they want to catch it, to arrive at their destination within about five minutes or so of the published times, and go about their work or education as normal. That is what they want.
Given the extended, prolonged, intense aggravation there has been, season-ticket holders in particular should get serious discounts. When they renew their season tickets, whether or not they have put in for individual compensation, they should get a serious discount and a very large apology to go with it.
On compensation, I had an email from a constituent who is losing earnings day in, day out. They noted
“I was unable to travel…due to no trains running between Polegate and Haywards Heath. I was compensated £19 for my daily loss of earnings of £350.”
My hon. Friend also mentioned the situation being dangerous, and I point out that this is not only about people’s jobs being on the line. A constituent of mine said to me that they are so late picking up their child from nursery that they are worried because:
“It is standard procedure that most nurseries contact social services when parents are late.”
The situation is damaging people’s lives.
That is just another example of the extraordinary strength of the impact on our constituents.
In summing up, I really think, with the greatest respect—and I understand that the situation is complex and challenging—that enough is enough. The Minister has got to get a grip on this. If this has not been sorted by the beginning of September, after the impact of the emergency timetable—and we have had no clear indication of when it will be sorted—GTR should lose its franchise by the end of the year. There have been enough warnings and pathetic excuses about one thing or another going wrong—goodness knows what it will be by the time we get to September—and this has gone on for far too long.
I hope that in response to this debate, the Minister can give a clear indication of what it will take for the company to lose its franchise, if it does not get its act together. At the very least, our constituents deserve a proper and honest answer from her about how she will achieve this and when. We are fed up on behalf of our constituents, who have to take this flak day in, day out. It is not fair, it is not right, and she needs to do something about it—and tell us what—now.
I will put a five-minute limit on for all speakers now. I may have to reduce that to try to ensure that everybody gets the opportunity to speak on behalf of their constituents. I hope to move to the Front Benchers by 3.35 pm or so.
It is a pleasure to serve under your chairmanship, Ms Ryan. I congratulate the hon. Member for East Worthing and Shoreham (Tim Loughton) not only on securing the debate, but on a very powerful speech; I agree with almost every single word. The fact that we see hon. Members from both sides of the House talking on a cross-party basis, along the same lines, illustrates the strength of feeling among our constituents about the joke of a service that they have been getting from GTR on Southern and Thameslink lines. I also take this opportunity to thank the 10 hon. Members—I think most are here—who have signed my early-day motion 298 calling for GTR to be stripped of the franchise.
I have to say that I laughed yesterday, when at about 5 o’clock, GTR tweeted:
“Don’t forget to plan your journey home this evening as there may have been a change to your usual train”.
There is nothing usual about the services that GTR provides. It has the worst record on cancellation and significant lateness, by some margin, of any operator, and it performs worst on the public performance measure.
As the hon. Gentleman said, we have had meeting after meeting and several debates on this issue. We get excuse after excuse, and our constituents have all reached the end of the line in their patience with what is going on—[Laughter.] See what I did there? The bottom line is that the company has not trained enough drivers. It is true that Network Rail has contributed to the situation and that GTR has to operate on an ageing infrastructure, but frankly, so do all the other train-operating companies. The delay figures show that Network Rail has caused more delays for the other train operators than for GTR, but the other train operators outperform GTR. There has been poor planning on a gargantuan scale and frankly, the management of GTR are absolutely appalling. We still have problems with basic things like information being provided when there is lateness.
The impact on constituents is absolutely unbearable. People have lost their jobs, which is a disgrace, as a result of the company’s poor performance. People who are still in their jobs arrive at work stressed and do not have the right mindset to start work, which will of course have an impact on productivity. Students and pupils have told me about the impact of the stress of getting to school to do their exams recently, as a result of the performance of that train operator.
So what do we want? I will probably not take up my whole five minutes, because I want to ensure that everyone else can get in. This franchise needs to end, and it needs to end now, or as soon as possible. I do not see why we should have to wait until 2020 or 2021 when it is up for renewal. I just cannot understand—I say this as somebody who professionally, as a lawyer, worked on a franchise agreement—how the company is not in breach of this franchise, such that it can be taken away from it. I understand absolutely that this is a big franchise. It is probably too big and, ultimately, I would like to see the parts of this franchise that cover London suburban routes transferred to Transport for London, which I believe could do a much better job of providing services to my constituents.
Turning to the longer term, in Streatham, we have Streatham Hill, Streatham and Streatham Common stations, as well as Tulse Hill and Balham stations just outside, and our stations have been over capacity for some time. Our population is growing and we are not in any Government programme to upgrade our local transport to be fit for the future. That is why ultimately, what we would like to see—I think this may provide a long-term solution to our problems with GTR and this particular franchise—is Crossrail 2 routed through Streatham. That would alleviate congestion on the Northern and Victoria lines, which are nearby, because large numbers of people to the east and south of those lines would therefore not have to travel to Tooting Bec, Tooting Broadway, Balham and Brixton and could use a Streatham Crossrail station. It would relieve congestion at Streatham Common, which is the sixth busiest station in the Southern network, and at Streatham station. It would cut congestion on our roads, too. Also, Streatham Action, a local group, and our local council have been clear that it would also provide an opportunity for growth and regeneration in our area.
I want to come back to where the hon. Member for East Worthing and Shoreham finished. What we want from the Minister today is action. We do not want the warm words that say, “Yes, I agree with you about how awful they have been.” We want action, and we certainly do not want the Minister acting as an apologist for this company.
We have been here before. There have been at least two debates in this Chamber, one secured by me and one by my hon. Friend the Member for Croydon South (Chris Philp), in which we heavily criticised Southern and also Network Rail for failing to deliver a satisfactory performance for their customers. We welcomed the introduction of a performance improvement plan, then a year later got very annoyed that the self-set targets, already low in that performance improvement plan, had not been adhered to; and before Christmas I said that unless there was a significant and rapid improvement in the performance of the company, removal of the franchise should certainly be considered.
Let us be clear. The current performance, which is measurably worse than it was a year ago and has deteriorated rapidly, is due to new and different reasons, and we have to understand what they are. Before the strikes that were called by the rail unions, 26 train cancellations a day were due to train crew unavailability. Clearly, it is a major failure on the part of GTR Southern not to have recruited sufficient staff to be able to run the service. Nobody should resile from criticising the company for that.
After the strikes began, in the period 29 March to 25 June, 148 trains were cancelled a day—a remarkable increase. The figures produced by GTR tell us, assuming that they are reliable, that driver sickness since the start of the strikes has increased by about a third and the willingness to work overtime has reduced by about a third. It is that remarkable loss of labour that is causing the real disruption that so annoys our constituents at the moment.
The dispute turns on whether it is safe to introduce trains with driver-operated doors. The question for hon. Members of all parties, including all of us who rail about the performance of the franchise holder, is whether it is safe to introduce such trains. Do we think the unions have a case in mounting their industrial action or not? It is hard to argue that there is a safety issue when 60% of the trains currently operated by GTR already have driver-only operation of doors, 40% of them Southern trains. Are we all saying that those trains are unsafe? Are the unions saying that those trains are unsafe? That is the kernel of the issue at the moment, so let us confront it.
We have to decide whether the unions have a point. If we do not think they have a point—I do not think they do, because there will be no job losses, no reductions in pay, and there will still be staff on almost all the trains, including the drivers that currently have guards who operate the doors—why are we blaming Southern entirely for this dispute?
I have absolutely no compunction about criticising Southern. No hon. Member has criticised Southern more firmly than I have over the past year. I have been very clear about the failings of the company and its management. No hon. Member has criticised Southern more firmly—the record shows that—but I am sure that the current disruption is being caused by the industrial action. What I question is why we collectively—hon. Members of all parties—have been so reticent to attribute proper blame to the unions for what is happening. In my judgment, the unions are being very clever. They know that this dispute is effectively a work to rule.
I thank the right hon. Gentleman for giving way and congratulate all those who have taken part in the debate. Does the right hon. Gentleman think it helped or hindered when Peter Wilkinson, the managing director of passenger services, said earlier this year:
“We have got to break them...They can’t afford to spend too long on strike and I will push them into that place...They will have to decide if they want to give a good service or get the hell out of my industry”?
I agree about the need for good industrial relations, but does the right hon. Gentleman think that that was constructive?
I am not defending Southern’s industrial relations. The question for the hon. Lady is whether she thinks the dispute is justified. If she would like to tell me that, I will sit down and give way to her now. Is the dispute justified or not?
Clearly, there has been a breakdown in communication between staff and management.
Answer the question.
The only way in which a dispute will be resolved is by people sitting round the table to discuss concerns about safety, and there are concerns across the network, across the country, about safety issues on platforms and about the control of doors.
We did not get an answer to the question, and therein lies the problem: the current disruption that is causing massive inconvenience to our constituents is principally—not entirely—caused by the industrial action, which is official on strike days but unofficial when it clearly amounts to a work to rule. The problem is being caused by the unions, but hon. Members are not willing to criticise the unions for that. Undoubtedly, all sections of the rail industry have a case to answer for the poor performance in the franchise. Some 60% of the delays up until we had the strike were caused by the failures of infrastructure of Network Rail, not Southern, although that is partly being caused by the upgrade at London Bridge.
There is a real question about whether the franchise should have been awarded and about the scale of it. The franchise is too big. All parties have a case to answer; I am sure there is a case to answer on the part of GTR and Southern’s management, too. For a start, they kicked off with insufficient drivers and staff. That is poor planning, but I go back to the central point that I was seeking to make: I have found it surprising in this debate that so little attention has focused on what the unions are doing.
Before the hon. Lady intervened, I was making the point that the unions have been very clever, because all the blame has been attributed to Southern, and what happens? We now have a pantomime villain to whom it is very easy for us all to say, “Boo! Take the franchise away.” I joined in on this pantomime cry: “Take the franchise away and all the problems will be over.” That is the easy thing for us all to say, but the question will remain: is it safe to have these new trains with driver-only operation of doors? The new franchisee will have to answer that question, and hon. Members are doing themselves no service at all by failing to address the key reason why the dispute arose in the first place.
It is a pleasure to serve under your chairmanship for the very first time, Ms Ryan, and I am extremely grateful to the hon. Member for East Worthing and Shoreham (Tim Loughton) for securing this debate. He and I sometimes sit together on the train—we come from neighbouring constituencies—so we suffer alongside the people we serve and see the problems at first hand.
I want to do the unusual thing of thanking the Minister because in the short time that I have been an MP, she has never refused to meet me to discuss the issues. It has often turned into weekly discussions where the anger that has been expressed to me by the people I represent has been expressed in forceful terms to her, which she has always accepted at face value, and I am grateful for that.
In the year and a half that I have been a Member of Parliament, it has been made clear that representing a constituency served by Southern is like having toothache: you wake up in the morning and feel the pain of people who are trying, and failing, to get to work on time; you feel the pain of people who get home late in the evening. It is constant and absolutely unavoidable.
I never expected, when I became an MP, that I would become such an expert on the train system serving my constituency. I now know the timetable, even though it changes so readily. I know the rolling stock. I have spent time training and doing work shadowing on the line, including shadowing several drivers to enable me to understand the pressures they are under. I have visited London Bridge to see the construction site, and have made a visit to see the new rolling stock, to try to understand the pressures on the system. I understand the scale of the problem. There is historical underfunding; new rolling stock is coming on line; there is the London Bridge upgrade, as well as routine track maintenance; there is an industrial dispute; and very bad planning by the rail franchisee has led to the poor number of drivers and conductors that underpins all the problems.
Does the hon. Gentleman agree that part of the problem—apart from what was highlighted by my right hon. Friend the Member for Arundel and South Downs (Nick Herbert)—is that the franchisee never planned ahead sufficiently for the right number of drivers and continued to give us thoroughly wrong information about how quickly the increase in driver numbers would improve the service?
I am grateful for the right hon. Gentleman’s intervention, because that is an incredibly important point. As I have said, bad management planning has underpinned all that is happening. It takes 18 months to train a new driver, and the driver shortages of the past six months to a year were absolutely predictable. GTR should have been on the case far earlier, and the fact that there is such a shortage of expertise on the line, including the shortage of drivers and conductors, has underpinned a shambles and turned it into a crisis. I have absolute sympathy with the right hon. Gentleman’s intervention.
It is inexplicable to me that, even with all the challenges on the line, things have so quickly descended into crisis. At the moment, in the midst of an industrial dispute, there is what I can only describe as a dysfunctional relationship at the heart of the network—between Government and the franchise holder, and the franchise holder and the unions, with Railtrack involved as well underneath it all. It means that no one involved wakes up in the morning thinking, “How do I make passengers’ lives better today? How can I make passengers’ journey home better than the journey they took to work?” The impact is that there is damage to the economy. People arrive at work late and get written warnings. They get home late, which damages communities and family life, because they are not home to see their kids before they go to bed. It is quite heartbreaking.
Someone who got in touch with me said that she had aspired for most of her working life to live in Hove, by the seaside. That is a community that I chose to live in because I absolutely love it. She has been there for five or six years, but things have now got to the point where she must pack her bags and leave—go back to London—because she can no longer cope with the shambles that is the rail franchise. The service is letting down communities and people.
The Minister will know that not only do I come to her to whinge, like everyone else, but I also try to present solutions. Many hon. Members here are like me, and want to help to turn things around and be supportive. I hosted a public meeting last week. The chief operating officer for Govia kindly came down and faced the full force of the anger in my constituency, so I am very grateful to Dyan Crowther. She left the meeting having learned in no uncertain terms how strong the sentiment is at this time. I have also co-founded and co-chair, with the right hon. Member for Mid Sussex (Sir Nicholas Soames), an all-party group that will provide an opportunity for all MPs in the area to come together for scrutiny of the issue, and enable them to support the change that is needed. I hope my actions will prove constructive.
Campaigners handed me a petition on the way in, and there are some sensible questions that I want to put directly to the Minister on their behalf. They want a sustainable compensation scheme that will be much more aggressive, assertive and responsive than the present one. They want first class to be declassified permanently, while the temporary timetable is in operation. I have written to the Minister about that; it is eminently sensible. The campaigners want the Minister to announce the duration of the present temporary timetable. I hope she will take all those points into consideration and give direct answers to the campaigners who want action so much.
I was going to start my remarks with a comment about déjà vu until I remembered that I started my previous remarks in this Chamber, on the same subject, with a comment about déjà vu. We are getting continuous repetition.
I held a public meeting on this subject in Horsham on Saturday, and 300 of my constituents turned up—all very angry. At least one of them, I dare say, is still angry, having come up by train to sit in the Public Gallery today. I will not repeat the remarks that other Members have so eloquently made about all the problems the situation is causing—the way jobs, health and family life are being put at risk. That has been expressed by my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton), among others. Every Member of Parliament attending the debate knows about that, the unions know about it, and the management knows about it.
Like my right hon. Friend the Member for Arundel and South Downs (Nick Herbert), who is also my constituency neighbour, I have been forthright in attacking GTR for poor performance, including in a debate that I obtained in this place three months ago. I am afraid that GTR entered the dispute when its reputation among its customers was at a low ebb. Notwithstanding that, however, I have no doubt that, as my right hon. Friend said, the immediate cause of the problems on the trains in recent months has been the dispute between the conductors and GTR.
I welcome the £2.5 billion investment in new trains. The independent Rail Safety and Standards Board has confirmed that the train doors can be operated safely by the driver. If that is so, it should be implemented. It does not mean that trains should be denuded of a second professional. I am totally in favour of having a second member of staff, trained in all safety precautions and techniques, on board the train in all but exceptional circumstances. I endorse the comment of the hon. Member for Streatham (Mr Umunna), who pointed out that management should have a sufficiency of trained personnel to ensure that trains can run appropriately. However, on those occasions, which should be rare, when a second staff member is not available, I want the train to be able to run, if it can do so safely, and get my constituents home in the evening from London Bridge or Victoria. I know that my constituents who are undergoing the current nightmare would appreciate knowing how many trains have been cancelled in the past because a conductor was not available.
Echoing what other hon. Members have said, I ask the Government to intervene directly to ensure that the dispute will be resolved. I have heard the Minister’s comments on guaranteeing jobs beyond the current franchise. My constituents are incredulous at the fact that no agreement has been possible to date, and I hope that the Minister’s proposal may result in a breakthrough in discussions. The dispute must not be allowed to continue. While the temporary timetable persists, may I ask the Minister four things? I make no apology for reiterating some of the remarks of the hon. Member for Hove (Peter Kyle).
First, why are trains not being declassified to ease the congestion on the reduced number of services? I appreciate that that may imply compensating first-class ticket holders; well, we should do so. Secondly, when will there be a complete overhaul of compensation? The Prime Minister—he remains that currently—promised a couple of weeks ago that we would hear news on that, but we still have not. It was in response to a question of mine in the main Chamber, at column 294 on 29 June. Let us be clear: delay repay does not do it. Many season ticket holders have given up on the trains because of their lack of reliability. They bought their season ticket for use with a timetable that has proved to be fictitious. I want a significant refund to be made to passengers.
Thirdly, GTR has shown a lack of foresight in the planning around the dispute. The dumping ground that is Three Bridges station is renowned. Why could alternative means to get passengers home from there reliably, without the colossal expense of taxis, not have been put in place by now? Lastly, in addition to explaining to customers the rationale for the dispute, I hope the management will give a granular explanation of the cause of the continuing disruption. Can we have, for example, regular publication of sickness statistics? GTR owes its customers, whose trust in the operator is low, proper explanations of why their lives are being made so miserable.
I appreciate that the franchise is huge and there were good reasons, connected with going through London, why it was put together in its present form. In our previous debate I asked the Minister to be brave, if she felt that she needed to and if the franchise had become too large and out of control. I should love to hear her comments on how she feels the debate has gone, and whether the franchise is still operable on its current basis.
Order. In an effort to ensure that everybody has the opportunity to speak, I am reducing the time limit to three minutes.
I will try not to use even those three minutes, Ms Ryan. I want to echo what others have said and to congratulate the hon. Member for East Worthing and Shoreham (Tim Loughton) not just on securing the debate, but on the passion and comprehensive nature of his arguments, reflecting the concerns of his constituents and everybody in this room.
The right hon. Member for Arundel and South Downs (Nick Herbert) made some points about the safety of trains without conductors. In the inner London part of the franchise, which GTR laughingly calls the metro zone, there are no conductors. If I thought for one moment that running driver-only trains was dangerous, I would be kicking up a fuss on behalf of my constituents who are expected to use trains without conductors. I do not believe that that issue is the key to the problem.
The difficulty is that Southern has provided lamentable services consistently throughout the time it has had the franchise. It worries me that the same company has the Southeastern franchise. The company will say that there is a Chinese wall between the franchises but I fear the contagion may spread. Just yesterday, one of my constituents said:
“On the new ‘emergency timetable’, peak time services, including the 802 from Anerley, have been cancelled meaning that passengers are forced to travel in overcrowded conditions on services that are often short formed and subject to delays and last minute cancellations. There is nothing particularly new here. Southern have always provided a sub-par service. This most recent disaster, however, seems to be a lot worse than the usual chaos.”
People have had to get used to “the usual chaos” when the service is provided by Southern.
I was standing on Forest Hill station the other day, fortunately waiting for an Overground service to Canada Water to come here. While I was there, the first train listed was the Southern service into London Bridge. As I stood there, it went from “on time”, to “delayed”, to “cancelled” within the space of four minutes. The short-running of trains is compounding the problem. People get on trains such as those on the Victoria to London Bridge line, which is supposed to go all the way, but they often get to Crystal Palace and are told that the train is terminating there, going both ways—to Victoria or to London Bridge.
The other day, a constituent told me that he had spent £700 on a season ticket for the service between Beckenham Junction and Victoria. That service has now been completely cancelled. I have been on to GTR to try to find out what the compensation arrangements are but, as the service no longer exists, my constituent believes that he now has little or no chance of being able to sustain his current job.
The situation is damaging lives. The sheer unpredictability of it all, from day to day, adds to people’s stress and the difficulties that they face. I know that the Minister has tried valiantly, over a long time, to deal with the situation, but if Southern is not up to running the service, somebody else has to.
It is not just the new timetable that is the issue. My constituents have faced delays for many weeks and months. Last month, more than 1,350 trains were delayed each and every week. My constituents are fed up. I will not go over the impact it is having on many of them, but their experiences reflect much of what has been said.
My constituency is rural, so the train service is the only form of public transport available to many people. I share Wivelsfield station with my right hon. Friend the Member for Mid Sussex (Sir Nicholas Soames). Plumpton, Cooksbridge, Glynde, Berwick and Polegate are also in my area, and are all facing significant delays. Cooksbridge has only ever had peak-time services. One of my campaigns during the election was to get an off-peak and weekend service for Cooksbridge, but I was told by Southern that it could not do that because it would add two minutes to the timetable.
My main concern for my residents is the new timetable, which was introduced on Monday with less than a week’s notice. Services on the branch line have been cut by 80%, and are being run by a replacement bus service. Those service cuts affect the stations of Southease, Newhaven Town, Newhaven Harbour, Bishopstone and Seaford.
Seaford is the largest town in my constituency, with 27,000 people who can no longer get to work and who have to travel to Brighton or Eastbourne, which they can no longer access by train to get to a hospital. There are young people who want to go to the University of Brighton or the University of Sussex, as there is only a sixth-form in the town, but they cannot access higher or further education because they have no train service. It is a tourist town, which depends on people not just leaving the town for work, but coming into the town to spend money.
Newhaven is a town that we are trying desperately to regenerate. I went over to France to try to save the ferry that goes from Newhaven to Dieppe only a few weeks ago. The French put £20 million a year into that ferry, and I am ashamed to say to them, “There is no longer any train service to Newhaven.”
I have five asks of the Minister. First, each and every train ticket, whether it is a single ticket or a season ticket, needs a fare reduction of 25%. Secondly, we need the urgent reintroduction of the branch line for the reasons I mentioned. Thirdly, we need new management to take over Southern. If we are not going to remove the franchise, let us get people in who can run it. No other rail operator has experienced such a level of delays when introducing driver-only trains.
Fourthly, the trolley service needs to be reintroduced. Passengers cannot be on a train for three hours and not be able to buy a bottle of water or a sandwich. The Two Ronnies made a career of making jokes out of British Rail sandwiches; we can laugh no longer because there is no trolley service available at all on my trains. Fifthly, first class needs to be declassified. I have been on a train when an elderly woman had nowhere to sit and was fined by Southern because she used first class. That is disgraceful. In the words of my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton), enough is enough.
I congratulate the hon. Member for East Worthing and Shoreham (Tim Loughton) on securing the debate and on his excellent contribution. I echo and agree with much of what has been said. My constituents use Southern services into London Bridge and Victoria from stations such as East Dulwich, Peckham Rye and North Dulwich, and they use Thameslink services from Sydenham Hill, Herne Hill and Loughborough Junction. It is fair to say that, before the current crisis, services were already unacceptably poor. The works at London Bridge were entirely mismanaged. Southern produced a timetable that was entirely unsustainable, had no resilience and was understaffed. Satisfaction with GTR services is among the lowest in the country and, within that, the lowest levels of satisfaction are within the metro part of the service and among commuters.
My constituents have shown immense patience and forbearance with their rail services while dealing with entirely unacceptable consequences to their quality of life. The impact on family life includes people being unable to see their children at bedtime, being consistently late picking up their children, being unable to meet caring responsibilities, losing jobs, having to move jobs and just simply dealing with the additional stress within lives that are already busy and stretched. That is simply unacceptable.
Much has been said about the industrial dispute. The responsibility for good industrial relations rests with all parties. The seeds of the dispute go back a long way, and are about understaffing. GTR started the franchise with fewer drivers than the previous franchisee reported having in post. How was that even allowed to happen? GTR has been too slow to recruit and too slow to train.
On top of all that is the introduction of the emergency timetable. I was grateful to the Minister for meeting me a few weeks ago to discuss the issue, as Southern presented a sort of plan for getting through the industrial dispute. Then, with no warning and no briefing at all, the emergency timetable was introduced. In my constituency, that involved pretty much the wholesale withdrawal of commuter rail services on the Southern part of the network. Only one train out of four or five an hour run, and my constituents simply cannot get on to those trains because they are too full.
The franchise needs to be withdrawn. Enough is enough. Patience has run out. The franchise needs to be passed to Transport for London, which has a track record of running decent Overground rail services in the capital. That is what passengers want and there are huge levels of support for it. I accept that TfL cannot do that in a single step but we are in a crisis, and I call on the Minister to take action to allow the Department for Transport to take over in the interim while arrangements can be made to transfer the franchise to TfL.
I thank my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton) for securing this debate. I speak on behalf of both myself and my neighbour, my right hon. Friend the Member for Hastings and Rye (Amber Rudd). We share the two worst-performing rail operators—Southern and Southeastern—and we bear our crosses as best we can.
I am also a daily commuter, mostly on Southern. I spend about three-and-a-half hours on my commute, so I experience the same frustration, anger and stories that many right hon. and hon. Members have detailed today. In Bexhill and Hastings we have suffered the emergency timetable, which has affected our two-carriage train. The train does not perform that regularly, and it is now even worse. The timetable is causing real misery for our constituents in both towns.
I am a member of the Select Committee on Transport, and I can perhaps bring a little optimism to the room. It was a delight to have the leader of the National Union of Rail, Maritime and Transport Workers, the chief executive of Southern and the rail Minister at our inquiry into Southern’s performance. The session made it clear that there is some common ground. The key now is to get everyone around the table. With respect to the RMT, we finally got it to agree that, really, this just comes down to jobs. The union could call it safety, and I could call it union subs, but it comes down to a guarantee that there will be a second member of staff on the trains. The Committee was reassured to hear from the chief executive of Southern that that guarantee will be in place not only now but for the entirety of the franchise. Southern cannot give any more than that because it cannot go beyond its franchise terms. We then asked the rail Minister what can be done beyond that, and I hope that I am not misquoting her when I say that she was able to confirm that the guarantee will be in place for the next franchise, too.
As my right hon. Friend the Member for Arundel and South Downs (Nick Herbert) said so forcibly, it is right for us to call out behaviour that we consider unreasonable. Who else is guaranteed a job for up to 10 years? Certainly not Members of Parliament. It is down to the unions to show a little more willingness. They have now responded by letter to say that they will call for a cessation of industrial action for a three-month period, which is a good start, but they must operate the rolling stock for which we have all been waiting for so long. If it turns out that a conductor cannot join a train but that the driver can close the doors, I would rather have that train run. The unions have to be reasonable.
The unions also have to be reasonable in helping to end the sickness issues. There is undoubtedly an issue that has to be ended, and the unions have the biggest responsibility for doing so. Those are my asks of the unions—they wrote back yesterday telling the rail Minister that they are willing to sit down and give talks a try. I urge her, and all concerned, to take up that offer.
I join colleagues in congratulating my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton) on securing this debate. It is no exaggeration to describe the situation on Southern railway as of crisis proportions. The impact on residents’ day-to-day lives is deep and profound. Lee Fenton, one of my neighbours in Coulsdon, lost his job because he was so persistently late for work. I have talked to people who have had to quit their jobs, to self-employed people who are losing earnings and whose businesses are no longer viable, and to parents who are not getting home in time to put their children to bed. These problems are profoundly affecting the day-to-day lives of tens of thousands of people.
Although industrial relations are, in the first instance, GTR’s responsibility, it is time for the Government to take a more active role in the industrial dispute and in matters of the railway’s performance, because this is more than just an industrial dispute on a railway, and it is about more than just how the railway operates. The dispute is profoundly affecting the lives of very many people. I share the view of the hon. Member for Streatham (Mr Umunna) that problems on Southern railway and GTR go back at least two years, and a fresh start with a new franchise is needed. Southern’s public performance measure has been very low for well over a year.
I also agree with my right hon. Friend the Member for Arundel and South Downs (Nick Herbert) that performance, which has been very poor for a year, has become abysmal as a result of the industrial dispute. I am firmly of the view that the concerns expressed about safety are wholly without merit. As we have heard, 60% of GTR trains already run perfectly safely with driver-operated doors. Every single London underground train, where platform crowding is significantly worse than on Southern railway, works with driver-operated doors with no safety concerns at all.
I urge Labour Members to use their influence with the RMT, which I suspect is slightly more significant than mine, to urge an immediate cessation of this groundless dispute. Jobs have been guaranteed beyond the lifetime of the franchise, which is a generous offer, and pay and the number of people employed have been guaranteed. There are no reasonable grounds for the dispute. This is an urgent matter, and I urge the Minister to take control of the franchise and to get involved in resolving the industrial dispute, because our constituents, neighbours and residents cannot take this any longer. It simply must end.
I congratulate my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton) on securing this important debate on the performance, and frankly the failure, of Govia Thameslink. I am sitting next to my hon. Friend the Member for Fareham (Suella Fernandes), and I must point out that this sickness has spread to Hampshire. Indeed, Southern has a toe in my constituency, and it must not be forgotten that services up from Swanwick in her patch—there is a bridge between our constituencies —to Gatwick airport have left travellers stranded and abandoned, with embarrassing and derisory compensation offered.
On unsafe practices, the duty of care is not about closing doors; it is about not abandoning and stranding people on the side of a railway, with trains being cancelled or changed at short notice. As my hon. Friend the Member for East Worthing and Shoreham said, people are simply being left in the middle of nowhere with no options.
Does my hon. Friend agree that the problem extends across the whole network? Many people using our stations in southern Hampshire on the mainline west coastway route—Swanwick, Portchester and Fareham—are travelling to Crawley or Gatwick for work, and they are putting their jobs at risk.
I absolutely agree with my hon. Friend. I have travellers from Netley and Hamble going to Bursledon and onward to Southampton Central. Those people avoid the A27 and the grind through Chichester, or the M27 heading to Littlehampton, Worthing, Hove or Brighton and the perils of the Chichester roundabout, in the hope of getting to work safe and sound. The safety considerations are, of course, off the trains. Yes, the unions might have a point, and perhaps we have not quite gotten to the bottom of that, but for me the safety considerations are about vulnerable people being left on the side of the railway.
We are a Government who stand up for working people, and it is time for us to stand up for passengers, workers, students, visitors and vulnerable people with children. There is an economic case for action on Southern trains, and I have previously asked the Minister a question on that in the Chamber. We have heard that the issue is blighting people’s lives day in, day out. It is not good enough.
I am also concerned about the safety of guards on trains. There is dangerous overcrowding late at night, with upset and angry people. Having seen the pictures of overcrowding at Victoria station, I am frankly surprised that there has not been a riot. The situation is dangerous. I do not want to over-egg or overhype it, but I have received feedback that people are frightened and concerned.
There is an economic case for us to support our businesses. We talk about Brexit and the problems that could affect our businesses, but the reality is that problems are happening now due to this franchise. I ask the Minister for a kind response and to think about all the families, workers and businesses who depend on the Government to make a substantial case for doing something. The time is now.
It is a delight to serve under your chairmanship, Ms Ryan. I congratulate the hon. Member for East Worthing and Shoreham (Tim Loughton) on securing this crucial debate and on his tour de force. We were all impressed by what he had to say.
After little more than two years, GTR’s operation of the Thameslink, Southern and Great Northern franchise has been an unmitigated disaster, with the targets on punctuality and reducing delays breached long ago and followed by a series of inadequate compromises between the Department for Transport and GTR. The views of passengers, and their intense dissatisfaction with GTR’s performance, are being managed rather than met by the Government. There is insufficient protection of the passenger and public interest in the reliable operation of these vital rail services, which are essential to both the national economy and the millions of passengers who rely on them.
GTR’s tenure has led to the worst punctuality ratings of any train operator in the country; a doubling in the percentage of trains that were cancelled or delayed by more than half an hour, from 3.9% to 7.4% of services which, again, is worse than any other operator in the last reporting period; an average of 50.9% of trains on time, one of the worst ratings in the country; and one in three Gatwick Express trains running late. The list goes on.
The latest Transport Focus statistics make for dire reading for GTR and the Government, with passenger satisfaction in decline to an unacceptably low level. Only 35% of passengers on the Southern metro and Sussex coastway lines regard the service as value for money, following the introduction of the remedial plan.
Will the hon. Gentleman give way?
Will the hon. Gentleman forgive me if I do not? I want to give the Minister time to respond, and she has little enough.
As Members who represent constituencies on these lines know only too well, all these performance failures were visible on Southern GTR services well before any dispute with the rail unions over driver-only operation and prior to Southern services entering the Thameslink, Southern and Great Northern super-franchise in July 2015. We have also seen the operator of last resort, Directly Operated Railways, scaled back within DFT and removed from the Rail Delivery Group.
GTR is widely recognised as the worst train operator in the country, following a sustained period of cancellations, lateness, worsening industrial relations and failed planning that makes a mockery of the Government’s regular sermons on the benefits of rail privatisation. There is cross-party consensus on the need for GTR to be stripped of the franchise: my hon. Friend the Member for Streatham (Mr Umunna), the hon. Members for Brighton, Pavilion (Caroline Lucas), for Lewes (Maria Caulfield) and for Croydon South (Chris Philp), the right hon. Member for Arundel and South Downs (Nick Herbert) and many others have all called for that. Even GTR acknowledges that it could have the franchise removed if it fails to deliver on targets in the franchise agreement. In this increasingly fractious affair, why is it only the Government who are not contemplating removing the franchise or even retaining the threat as a means of improving performance?
The Opposition would like to see our rail services back in public operation, but to ignore the clear evidence of the essential service protection that the public sector provides through the operator of last resort is entirely reckless. Perhaps GTR’s accounts shed more helpful light on the extent of its relationship with DFT and the purpose it serves. Under a section entitled “Political Risks”, GTR states:
“It is not anticipated that any significant political change in direction would affect the existing contract. The company’s senior management continue to work closely with the DFT to ensure consistency of messaging to try to manage stakeholder expectations.”
That may be standard language to reassure shareholders and investors, but it also strikes me as evidence of an unhealthy relationship in which the Government are committed to preserving the GTR franchise, whatever the cost to passengers, staff or the taxpayer. The taxpayer is paying GTR an estimated £1.17 billion every year in management fees for this dysfunctional service, and that does not include the huge levels of investment in track and stations through publicly owned Network Rail every year, including the redevelopment of London Bridge.
Neither sickness levels nor industrial action are responsible for the misery that Southern commuters in particular have contended with for more than a year now. The decline in industrial relations is a direct result of the close relationship between the Government and GTR. When senior civil servants are quoted at public meetings stating to passengers that they “have got to break” rail unions, as my hon. Friend the Member for Nottingham South (Lilian Greenwood) said, the problem is entirely of the Government’s making.
Labour is clear that the Government’s failure to include meaningful penalties in the franchise is at the root of GTR’s declining performance. We call on the Government to strip GTR of the franchise. That is the only way in which sustainable improvements in performance can be achieved. The breach and default levels for service cancellations under the original franchise agreement with Govia have been consistently exceeded, and what we have seen in response is the imposition of a remedial plan cooked up between GTR and the DFT in February this year and kept away from prying eyes for three months. That raised breach and default levels for service cancellation, meaning that passengers would have to cope with up to 31,000 fewer services.
The Minister was absolutely right when she said in a debate on Southern in this Chamber almost exactly a year ago that high levels of delay and cancellation were
“an unacceptable burden on working families.”—[Official Report, 8 July 2015; Vol. 598, c. 105WH.]
That burden is worse today, and it is the direct result of the Government’s handling of this franchise—indulging GTR and failing to respond to consistent failure with removal of the franchise.
Let me turn quickly to the current dispute. Even the industry-funded Rail Safety and Standards Board has acknowledged that driver-only operated services
“may increase the likelihood of an event occurring or increase the severity of its consequence.”
The issue is whether risks to passengers increase when things go wrong if passengers no longer have a binding safety guarantee from a second member of on-board staff who is fully trained in safety-critical procedures. GTR’s proposed new role of an on-board supervisor will not be that of a guard or a conductor; it will lack critical safety training in carriage and passenger protection in the event of an emergency incident.
GTR and the Government have also claimed that there will be no deskilling or dumbing down as a result of the GTR proposals to extend DOO on Southern services, yet the Minister told members of the Transport Committee on Monday that no train that currently has a second person on board would lose that person, and that she would ensure that the safety-critical role is maintained. We hope she will confirm today that that safety-critical role will be maintained over the life of this and future franchises. Central to that is retaining the 12-week training requirement for the second member of train crew—whether that is a guard, a conductor or an on-board supervisor.
I note that the RMT offered last week to suspend its industrial action for three months, as long as GTR suspends the DOO extension plans for a similar length of time. It surely makes sense now for the Minister to invite the RMT to meet her at the earliest opportunity to discuss the terms of a settlement with GTR that would also apply to future franchises. That should allow both parties time to reach a conclusion to this dispute, if not to the performance problems that have dogged GTR since its inception, which we believe can only be remedied by removal of the franchise.
I appreciate the opportunity to serve under your chairmanship, Ms Ryan. I thank right hon. and hon. Members on both sides for their contributions to this important debate. Before I look forwards, I want to take a couple of minutes to look back.
One of my first jobs on becoming rail Minister in 2014 was to go up the Shard and welcome this new franchise, and to celebrate the fact that the franchise had been awarded to an operator who, by all accounts, was well qualified to take it on. It had operated trains during the Olympics, when everything ran swimmingly, and it was appraised of the extent of the Thameslink disruption. It had an investment plan and a plan to redress the shortage of drivers—an issue that had bedevilled the previous franchise. Things seemed to be set fair.
In the summer of that year we saw the major blockades at London Bridge which caused massive disruption for people—not during the blockade but at points afterwards. Afterwards, we ran into weeks and weeks of problems. I got involved and we had a weekly quadrant meeting. My friend the hon. Member for Hove (Peter Kyle) said that we all now know far more about trains and franchising than we ever thought we would have to know.
In fairness, things were starting to work. Despite the lack of joined-up thinking about the impact of the London Bridge works on existing commuters, the major problems with Network Rail’s infrastructure reliability, which were not being addressed properly, and the series of changes, including Sir Peter Hendy coming in from TfL and taking direct control of all the infrastructure work in that area, everyone was pulling together, with the massive involvement of my officials, and in April the public performance measure got back to 83.6%.
That is rubbish.
It is still terrible.
It was not nearly good enough, but that was 10 percentage points up over the last six months. There was every view that performance was returning to the place where we needed it to be.
Since then—I will come to the issue of the industrial action—all bets are off. When people simply do not know how many staff are rostering in a particular depot, particularly the Brighton depot, where so many trains start and finish, it is impossible to run a reliable service. I have been to London Bridge and Victoria stations many times and travelled on the trains and I have been ashamed to be the rail Minister. I suggest that successive rail Ministers over many years in many Governments should share that sense of shame.
There seem to have been four fundamental failures in the industry that mean that when things go wrong, it is really hard to recover. It is the customers—the passengers who rely on the train services—who suffer. First, I submit to the House that there has been a disdain for people—for passengers—at the heart of the railway for decades. I have shared this anecdote with the House previously: a former very senior member of Network Rail said to me that the problem with the timetable is that the customers mess it up. Think about what that implies about what that person’s view of their job was: to run a system, not to move people.
Crowding is not really costed in any of the economic measures that successive Governments have used. There has just been an assumption that people will continue to cram on. It is more valuable to put a train on a long-distance service, where there is a discretionary choice of travel, than to relieve crowding on an overground service around London. That seems to me to be perverse.
Investment has been entirely focused on engineering improvements and almost never on reduction in delay. Why do we still have this “leaves on the line” problem every year? By the way, no one has ever calculated the economic consequences of leaves on the line. Surely it is not beyond the wit of our finest metallurgists to solve that problem, yet we just accept it. We plough on and look to shave five minutes off long-distance journeys.
Thameslink will deliver some significant benefits for people travelling through London. There are brand new trains and wonderful new stations such as Blackfriars, which nobody ever talks about. It is a wonderful station delivered without a trace. Nevertheless, the human cost of the Thameslink work on the travelling public was almost forgotten. I was not the Minister at the time and I do not even know under which Government it was planned, but a man came up to me at London Bridge station in tears and said, “You’re doing this so people can get from Cambridge to Brighton without disruption. That’s great, but I just want to get home to see my kids.” There is something flawed with the industry, because it does not value those people’s experiences.
The second failure is that, as Members know, the industry has a highly complicated structure. We have Network Rail, which is in a much better place now, post the Hendy review and Shaw changes. It has made some amazing hires. We have a franchising system that in some cases delivers huge benefits but in other cases does not. The problem with franchising is that if it is a very short-term franchise, nobody has an incentive to invest in industrial or passenger relations. Why would the staff care when the name on the nameplate changes every seven years?
They do care.
They do care, but why would they feel an allegiance to a company the name of which changes every few years? The staff on the frontline care in extreme amounts, and we are all very grateful for that.
Will the Minister give way?
No, I am going to continue.
Thirdly, we have an investment structure that is broken. The Government step in over and over again to fill the gaps and to buy rolling stock. By the way, the profits in the rail industry mostly accrue to the rolling stock leasing companies—the ROSCOs. If Members look at the shareholder structures to see where the profits are, they will see that they are with the rolling stock companies, not the franchise operators. GTR’s margin this year is going to be around 1.5% on this franchise. There is something structurally wrong with the financial structure of the industry.
The fourth and final problem is that the contractual levers are really poor. I have been asked repeatedly, “Why don’t you just take the franchise back?” The reason is that I cannot. GTR is not in breach of its franchise contract right now.
The hon. Gentleman knows—he has been involved in contracting—that we have a contractual structure and there are a series of inputs and outputs. The company is not in breach of them. People ask what happened with Directly Operated Railways. The franchise was handed back to the Government by East Coast. In such circumstances we can take it back in-house and do something with it, but at the moment I do not have the levers to pull to take the franchise back.
Will the Minister give way?
No. If I may, I will continue, because I want to try to address some action points. I will try to finish quickly.
If I thought it would help for me to fall on my sword, I would. I have thought about it repeatedly. I do not like failure. I do not fail at stuff in my life. This feels like a failure. Could I do something contractually to force the franchise to end early? Would the problems actually go away? Would the industrial action and staffing problems stop? No. Would the investment programme create anything more certain for passengers? No. In my view, it would do almost nothing. It feels like that scene in Tom Wolfe’s “The Right Stuff”, when the test pilot is “augering in”—into the ground—shouting:
“I’ve tried A! I’ve tried B! I’ve tried C! I’ve tried D! Tell me what else I can try!”
I take issue with the view that nobody cares. Charles Horton and Dyan Crowther really care. They have done so much work. They have been out there, briefing and working tirelessly. The emergency timetable was not just some fantasy; it was an attempt to try to deliver a reliable service that would actually work, by compressing staff and trains into the areas of greatest need and making sure that the services that were withdrawn were ones for which there were alternative routes. The front-line staff really care. Day after day, they are there, holding the line, dealing with angry customers and trying to cheer up passengers. Right hon. and hon. Members really care. We have all been on this journey for many years now. My Department cares passionately. Nobody is enjoying this process.
On industrial relations, it is true that doors operated by drivers are safe—61% of GTR trains are already operated using the technology. It is incredible what can be done through industrial action. Is it politically motivated? I do not know. Yesterday, the 8.36 service from London Victoria to Sutton was cancelled because an unknown person had been smoking in the driver’s cab and the driver was not happy to drive the train. The driver’s cab had to be aired and cleaned before it could be utilised, so the service was cancelled, causing knock-on delays throughout the day. To me, that does not feel like everybody pulling together to deliver a battle plan for customers who want to get home, which is what I think they should be doing.
What are we going to do? The one-month emergency timetable was today—at least as of 12 noon—delivering a 90.3% PPM on Southern. Everything could go wrong later in the day, but it looks like it is starting to work. That timetable will be in place for one month, and we need to monitor it closely. I want to bring forward compensation plans. That will involve negotiation with other parts of the Government, given that we are talking about revenue that is coming into the Government coffers, but I am very keen to deliver compensation. I have written to the next Prime Minister about this. She has a proposal to get customers and unions more closely involved in the management structure of companies, and GTR would be a perfect example of involving them. I do want to meet the unions and the management. I have been advised repeatedly to stay out of it—hell no! I want to sit people around the table and say, “What the hell is going on? Let’s try to sort this out.”
Over the medium term, I want to accelerate the plan for the devolution of rail services to London. It is absolutely right to do that and it will deliver capacity on inner-London and suburban routes. I do not care about the politics and I do not care that there is a Labour Mayor; I just want the trains to run better. I also want to look at a new structure. In the Shaw report, we gave ourselves permission to look at new ways of running the railway. Could we put rolling stock and infrastructure together in a way that delivers a better service for passengers?
Although GTR is a highly complicated franchise—it is the busiest, most complicated thing in the country—it could be the perfect way to try to get everyone to focus on delivering a service. Would it not be great to be proud of the services that were bringing people into the greatest city in the UK, rather than ashamed? That is what I want, and I know it is what we all want. I may not be the Minister to deliver it, but as sure as hell I will keep trying until I am kicked out.
From Streatham to Horsham, from Fareham to Bexhill, from Dulwich to Lewes, our constituents are angry, for all the reasons that have been laid out very passionately by the more than 20 Members present for the debate. With respect to the Minister, I did not want a history of the railways. I did not mention leaves on the line. I certainly would not hold up an 83% PPM as a badge of honour, because that means that almost one in five trains are still running very, very late. She said that the company was not in breach. When on earth will it technically be in breach? We need to know that.
I asked about the financial implications for the company and the Government, but answer came there none. Will the Minister please write to us so that we can understand at what point this nightmare will come to an end? The hon. Member for Hove (Peter Kyle) described it as toothache, but the pain that our constituents are suffering is more like serious root canal surgery. My right hon. Friend the Member for Arundel and South Downs (Nick Herbert) said that we need to blame the unions. We do, but we also need to blame the non-21st century management practices of GTR for their not getting around the table and doing something about it.
In none of the vocabulary I heard from the Minister were the passengers the most important part for the solutions we need to achieve. I say to her: I know it is difficult to take back the franchise, but please, please set down some parameters for when such action might be triggered, or tell us what else you are going to do about it.
Motion lapsed (Standing Order No. 10(6)).
South Manchester Transport Infrastructure
[Mrs Anne Main in the Chair]
I beg to move,
That the House has considered transport infrastructure in South Manchester.
It is a great pleasure to serve under your chairmanship today, Mrs Main, and to see other Members here in Westminster Hall. I take this opportunity to thank the Under-Secretary of State for Transport, my hon. Friend the Member for Harrogate and Knaresborough (Andrew Jones), whom I am pleased to see is still in his post after what has been a very busy day.
I have worked with fellow members of the Communities and Local Government Committee to scrutinise the Government’s landmark devolution legislation. I must confess that, as the Member for Cheadle, I have a vested interest in its success. Cheadle is a constituency that sits within the Greater Manchester city region, which has already benefited from £7.6 billion funding towards the northern powerhouse.
Good transport links are key to the success of the northern powerhouse. Indeed, the enabling powers in the devolution legislation are crucial for regional ambitions for business to deliver prosperity at a time when now, more than ever, effective connectivity and transport infrastructure from the suburbs to the city are vital. I am therefore grateful to be able to raise this issue with the Minister, thereby providing an opportunity for my constituents to be reassured that the Government are committed to building the northern powerhouse, to encouraging investment in transport, and to underwriting our ambition as a city region that is easy to do business with. We need to correct traditional regional imbalances, and transport is a vital element of achieving that objective.
Greater Manchester is a major region, with 2.7 million inhabitants. In total, our Government aim to spend £13 billion on transport during this Parliament to support a growing economy and our increasing population. It is within the context of the Government’s devolution agenda that further powers will place transport choices in the hands of local communities. Thus, the way that people travel and do business is set to change for the better.
I applaud my hon. Friend for securing this very important debate. My constituency of High Peak does not qualify as part of south Manchester, even though economically it looks to south Manchester. Does she agree that, although the transport links within south Manchester are crucial, to make the northern powerhouse work we have to get the trans-Pennine links that the Minister knows well from visiting my constituency—the A628 and the A57, the links from Greater Manchester across to Sheffield and the rest of Yorkshire—working well? They are just as vital as other links for what she is trying to achieve.
I am grateful to my hon. Friend for making that point. Indeed, it is the wider links across the region that need to be considered in this discussion, because we need to do business and we need to change, and we need to make that change a change for the better, with the potential to generate local and international business, creating global connectivity for Britain’s second city, as well as for the periphery.
The Greater Manchester Transport Strategy 2040 and its consultation document, which was released last week, are explicit about the need for transport to address long-term challenges in Greater Manchester that are inclusive of but not limited to our growing population.
As local plans are put in place to deliver the housing needs of the city region, our local road network is the infrastructure workhorse of our communities, and as growth is planned we must remember that our roads are not only lines on a map but a vital means for people to live their lives. Clearly, there are areas where roads are stretched beyond their capacity. A prime example is what was once a simple junction connecting the communities of Cheadle and Gatley that now blights the lives of pedestrians and drivers. It is in the light of these pressures that I will talk about the road network in my constituency. One of the most pressing issues for my constituents is indeed the junction of the A34 and the A560 at Gatley.
Unfortunately, well-intentioned but small-scale interventions over the past 20 years have not been enough to tackle the problems of this junction and to make it fit for the future. As one of the five busiest junctions in Greater Manchester, it experiences the passage of 74,500 cars a week. In addition, esure insurance recently found it to be the sixth worst junction in the country for drivers jumping red lights. Plainly, it is operationally substandard.
That has placed a great strain on the wider road network, creating tailbacks along the M60 just a few hundred metres away and creating congestion for a considerable part of my constituency and on to the A34 Kingsway. The M60, which has two slip roads on to the A34, further adds to local congestion and environmental challenges. Over time, efforts to improve the working of the junction have included the creation of an eastbound left-turn lane for traffic approaching from Gatley, as well as the installation of traffic signals on the nearby off-slip from the M60 to better regulate traffic flow into the junction. More recently, the junction has benefited from the actuation systems to adjust signal timings in response to changes in traffic flow. However, it remains a major problem for the area.
Long-term transport problems were identified in the catchily titled South East Manchester Multi Modal Strategy, which is known locally as SEMMMS. SEMMMS was first produced in 2001 and is now due for reconsideration.
I am also aware of the memorably titled SEMMMS project. Does my hon. Friend agree that one of the main causes of road congestion in Stockport is the lack of an A6 bypass from Hazel Grove to Bredbury, which would join with the M60? If she does, will she urge the Minister to consider that project for future funding?
My hon. Friend, whose constituency is right next to mine, knows full well how important that link would be. Indeed, I will add my words to his in pressing for that project to be considered.
I look forward to the refreshment of the SEMMMS plan, which is ongoing, and I will press for further consideration of the A34 corridor plan, which will explore the A34’s intersection with the M60. That plan will enable Transport for Greater Manchester to develop a more detailed understanding of the long-term growth implications along the A34 and to identify further areas of improvement to manage congestion. These problems need to be addressed both imminently—indeed, immediately —and for the longer term. This junction is broken and we need to fix it.
It is a fact that alongside Greater Manchester’s growing economic strength—growth that creates new employment and development opportunities across the wider conurbation, including Stockport—pressure continues to be put on local highway networks. There is particular pressure at junctions where there are complex flows of traffic wanting to access the city, Manchester Airport, the M60, the M56 and, very importantly for my constituents, local facilities and residential areas.
Further pressures on the general network and the A34 corridor are also in the spotlight as the Greater Manchester Spatial Framework and the Cheshire East local plan are being drawn up. It is clear that local plans must take into account the implications of increased developments, and where there are cross-boundary transport infrastructure issues it is vital to have co-operation between all stakeholders, including central Government.
I will highlight for the Minister the need for continued investment in the north. I welcome all the investment that we have had so far, but I am firmly focused on the north’s future. I have also stressed the importance of smaller infrastructure projects—yes, we need High Speed 2 and High Speed 3, but we also need to underwrite this ambition with support for large but more local projects.
I am pleased that for Members whose constituencies have problematic junctions, the Government have committed themselves to investment, delivering the biggest road improvement programme since the 1970s. Continuing that commitment will be imperative.
Infrastructure investment is represented by the £475 million Local Majors fund, which is designed to support local transport projects. That is an example of the type of investment funds we need in the wake of the referendum. Indeed, these smaller scale but large local projects also need prioritising.
I have had meetings with the interim mayor of Greater Manchester and the strategic transport director of Transport for Greater Manchester to discuss applications for the fund and the role I can play in facilitating them. I encourage the Minister to continue making local authorities aware so that we can all benefit from the potential prosperity the funds can generate. In my constituency, we look forward to progress being made on the changes so urgently required at the Gatley junction, and that should be considered as part of the wider SEMMMS strategy.
I am conscious of time, but I want to touch briefly on the ambitious developments in high-speed rail. HS2 will sweep into the north. I know I am touching on the programme with a brevity that does not do justice to its importance, but with phase 2a to Crewe opening in 2027 and the delivery of phase 2b marked for completion in 2033, there can be no further delay to the roll-out of the UK’s largest infrastructure project, through which the north can benefit from increased capacity to meet demand. I therefore look forward to the legislation being brought forward later this year for phase 1. Although I appreciate the extension of timetables for delivery to allow the petitions process, I urge the Government to take steps to prevent further delays to the opening of the first step to high-speed rail.
From a local perspective, I am pleased that the ambitious project of HS2 will come close to Cheadle at Manchester airport, but I would welcome further assurances on that crucial airport link to move from planes to trains. Additionally, I welcome the commitment to modernise and renew the rolling stock, with a move away from Pacer trains—many commuters between Cheadle and Manchester will echo my views—following Arriva’s new franchise around Manchester. I know passengers would welcome an increase in the capacity and comfort of local journeys. I also highlight the need for investment in stations, particularly through working cross-departmentally with the Department for Communities and Local Government to improve station environments, such as that at Cheadle Hulme in my constituency. In addition, I will be looking for greater responsibilities for franchises to invest in ticketing, to make it easier and more comfortable to travel and to use the networks to the full.
Does my hon. Friend agree about the importance of working with friends groups at those stations? They can do great work in drawing attention to the needs of the stations and to station improvements.
I echo my hon. Friend’s point. Friends groups in all walks of life play an important part in our constituencies, particularly with regard to our railway stations. I am looking forward to hearing about improvements that could be made to get much needed disability access in our stations. We have so many people calling for that; it is about time it was delivered.
Better bus services are also critical to unlocking growth in our communities, reducing congestion, supporting the elderly in socialising and helping to improve our environment. The Bus Services Bill, which hands franchising powers down to local authorities, will better enable those authorities to tackle priorities for improvements that will increase passenger numbers and deliver more benefits. Those benefits must continue to include connectivity, and, whether it be through smart cards or better branding, getting more people to hop on a bus rather than get in the car. Central to that are more frequent services. It is always disappointing when we hear about services being reduced, such as the X57 service, or withdrawn, such as the 373. That takes away a valuable link between constituents and their work, home and hospitals. I am keen to see measures put in place to enable local authorities to influence timetabling to better reflect local need. Furthermore, the Bill and franchising offer the prospect of improved disability access, which we need, whether that is through innovative visual or audio capability or better disability training, so that drivers know where to pull in at bus stops. I have drawn local stakeholders’ attention to Muscular Dystrophy UK’s Trailblazers report on improving access for young disabled people.
In closing, I seek assurance from the Minister that current and future programmes will continue to be funded as has already been pledged. We all appreciate the changes now in train—excuse the pun—owing to recent national developments, but the future prosperity of the north and my constituency must be maintained. Following the decision made three weeks ago tomorrow, there is a strong argument for more infrastructure investment and delivery, and that needs to take place with the small-scale and long-term, large-scale projects.
The northern powerhouse concept is crucial not only to the prosperity of the north-west of England, but to the whole of the north and the country itself. If it is to succeed, we must be committed to its funding, to improvements to roads and junctions, to the construction of HS2 and HS3, and to the transport infrastructure of Greater Manchester in all its forms. This is undoubtedly an exciting time for the Greater Manchester region. Now more than ever our attention is turning to the north, and power is moving from Whitehall to local communities as a result of our devolution process. I look forward to the prosperity I know that will bring to my constituents, Manchester and the north.
It is a pleasure to serve under your chairmanship, Mrs Main. I start by congratulating my hon. Friend the Member for Cheadle (Mary Robinson) on securing this debate. Transport is hugely important to Greater Manchester. We agree entirely that it is essential for growth and we are, as she said, investing significantly in it. Through our devolution deals, we are putting Greater Manchester at the heart of the northern powerhouse.
As my hon. Friend knows, we are committed to creating a northern powerhouse, which is effectively about rebalancing our economy. It is part of a much broader national long-term plan. We have created Transport for the North to be a key partner and delivery body within that agenda. Its job will be to develop and drive forward transport plans to support the economic growth of the north. In terms of capital expenditure, we will invest £13 billion in this Parliament to better connect the region so that northern towns and cities can pool their strengths and create a single economy. From being a fragmented economy, it will become a much more cohesive one that is more than the sum of its parts.
I agree entirely with my hon. Friend: this is an exciting time for Greater Manchester. There is no question about that. Greater Manchester is at the heart of an exciting agenda. It is a centre of innovation, education, industry and culture. Its local enterprise partnership describes it as the fastest growing economy outside London and Europe’s most competitive business location. South Manchester, with its key assets such as Manchester airport and Stockport, is obviously right at the heart of the region’s success.
My hon. Friend was broad in her sweep of transport in the area, and I will try to match that and then focus on some of the local points that were made. Manchester airport is the UK’s third largest airport. It employs 20,000 people, indirectly supports a further 25,000 and contributes £1.8 billion annually to the economy. That is a fantastic record. In addition, the £650 million airport city enterprise zone promises to create between 7,000 and 13,000 jobs. The airport announced its £1 billion transformation programme last June, through which it will employ more people and create more wealth in the area. The airport’s success is tremendous news for the north as a whole and in particular for Greater Manchester and my hon. Friend’s constituents. However, transport infrastructure needs to be in place to support that growth. People need to be able to get to the airport to benefit from it.
The south-east Manchester multi-modal strategy, or SEMMMS, highlighted the significant problems experienced in south Manchester. The proposed solutions have sat on the shelf for years, including the A6 to Manchester airport relief road. I am delighted that we have been able to support that important scheme, which brings significant benefits to the residents of the areas where traffic will be reduced, to those who will be able to access Manchester airport much more easily and to all those who will benefit from the economic growth that the scheme will bring across the area. Our support for the scheme shows that we are serious about working with local partners, because a partnership has brought the scheme to fruition. The overall budget is well over £200 million, but the Department’s contribution is £165 million or so. It is a proper partnership that shows we are serious about engaging with local partners to deliver the world-class transport network that the area requires.
My hon. Friend mentioned the strategic road network. The road network is under pressure in Manchester, because of a growing population and growing economic activity. We are investing £1.5 billion in the north-west in our road investment strategy, which will deliver the biggest increase in capacity since 1971. That includes an upgrade to the strategic roads serving south Manchester. Work is under way to deliver the smart motorway upgrade for the M60 junction 8 to M62 junction 20, and the A556 Knutsford to Bowdon scheme, which will improve the main southern access to Manchester. Further work is planned to upgrade the M60 to a smart motorway between junctions 24 and 4, and to upgrade the M56 to a smart motorway between junctions 6 and 8. In addition, my Department has an ongoing study on the case for building a trans-Pennine tunnel, which is potentially a transformational project. It has been long discussed in the north, as the hon. Lady knows—for decades. We are investigating the potential for that transformational new connection between Manchester and Sheffield. A study on the M60 north-west quadrant is looking at improvements that could benefit the area and the whole M60 route.
My hon. Friend the Member for High Peak (Andrew Bingham) never misses an opportunity to highlight the extreme importance of developing the trans-Pennine links. As ever, we are in full agreement on this issue. He is right to champion them and our commitment has not wavered.
We are starting the process for the second road investment strategy, which will be for the period post-2020. We are trying to make it a much more open and locally driven procedure. Contributions are coming in from local highways authorities, local councils, local enterprise partnerships and Transport for the North, and they will help to determine the priorities for the strategy. I have written to colleagues, as have Highways England, so that the in-depth knowledge that MPs have of the area, its problems and the potential for future development can inform the process and make it as good as it can be.
Rail in the area is obviously fundamentally important as well. We have the biggest programme of railway modernisation under way since the reign of Queen Victoria. The north of England rail infrastructure upgrade programme will transform rail travel in the region. Work has begun and we are already seeing some real progress. In 2013, we saw the first phase of north-west electrification, enabling electric trains to run from Manchester airport to Glasgow. In 2014, we knocked 15 minutes off the fastest journey time between Liverpool and Manchester, and in 2015, we completed the electrification of the railway between Liverpool and Manchester, and Liverpool and Wigan. I have been to see the progress made, have experienced the benefits, and have spoken to some of the train operating company’s team working there, and some passengers. It has been very well received. But of course there is much more to be done.
Our programme of more than £1 billion includes a substantial electrification programme and other track, station and signalling improvements, to increase capacity and the number of services, making journeys faster and more reliable. The transformative new TransPennine Express and Northern Rail franchises will deliver high-quality services for passengers. For south Manchester, that will include a significant increase in the capacity into Manchester in the morning peak and more seats on TransPennine Express trains; more trains to a range of major destinations right across the north; new and refurbished trains offering significantly enhanced passenger benefits; and—this has caught people’s attention more than any other element of the announcements—the outdated Pacers will go. They will go from the north’s railways by 2019, to be replaced with significantly upgraded trains. I know the frustration that people have with the Pacers; they also serve my own line and I use them on a weekly basis.
My hon. Friend the Member for Cheadle made a good point that it is not just about rolling stock or infrastructure—we need station enhancements too. That is clearly a priority. Disability access is a top priority for the Department, as part of the access programme. The Department is producing an accessibility action plan, which will be published later this year, and will focus on how we can make the public transport network much more friendly for everybody within our communities. It is worth highlighting that Northern has committed to spend more than £30 million on station upgrades across the franchise over the coming years. That might address some of my hon. Friend’s concerns about Cheadle Hulme station. My hon. Friend the Member for Hazel Grove (William Wragg) is right: friends groups play a great role in being champions for their stations and making them open, friendly, informative places that people go to rather than scuttle through in a hurry, as they might have in the past.
We must mention HS2, which will be a huge boost to Manchester and the surrounding area. It will bring jobs, growth and regeneration opportunities. A station at Manchester airport will help bring those benefits to the constituency of my hon. Friend the Member for Cheadle, as well as to many other constituencies in the area. It will provide additional connectivity for the region, allowing passengers to access the high-speed rail network without first travelling into central Manchester. I agree with my hon. Friend’s request for urgency. It is an important scheme, which is critical to the Government’s programme, and we do not want to see any delay.
Local transport was a key part of my hon. Friend’s contribution. She clearly identified the pressure that the local highway network is under in south Manchester. There has been some investment to address that, but it is a significant challenge. Measures to improve traffic flow on the M60 at junctions 1, 3 and 4 are underway, as is work on the traffic signal control at the junction of the M60 and the A34.
Moving on to public transport, improvements at Cheadle Hulme and Hazel Grove railway stations are under way, as are priority bus routes into central Manchester. Metrolink has been extended to Manchester airport, where a third rail platform has just opened. New transport interchanges have been built at Altrincham and Wythenshawe. Some £115 million from the local growth fund is being invested to improve transport access in Stockport town centre. It is a very exciting time to be involved in public transport in Greater Manchester.
There are clear pinch points. The junction of the A34 and the A560, as highlighted by my hon. Friend, is a well-known problem. I understand that she met recently with a former colleague, the interim mayor Tony Lloyd, to discuss that junction. I am sure she will be aware of the A34 corridor plan being developed as part of a wider refresh of the south-east Manchester multi-modal strategy. Although I share her sense that this is a priority, it is a local network and local decision. She must therefore work closely with local partners to ensure that they are aware of the concerns and bring forward robust proposals to tackle the congestion. It is well known not just in her own area, but beyond. I will make sure that officials from the Department for Transport keep in touch with that work as it develops and inform me of progress so that I can see what is happening.
We have covered a lot of ground, and have not even got to the Bus Services Bill, which is an opportunity for change in the bus market. The Bill is about to have its third day in Committee in the House of Lords, and will head to our place shortly, I hope. Greater Manchester has said that it is keen to explore franchising options. The Bill will include powers to enable local authorities to have greater input and control over the bus market. Buses are part of the future of public transport. They are underestimated and underinvested in, but my hon. Friend was right to highlight their importance. They are essential to deliver the heavy lifting of our public transport system, as well as air quality improvements in our towns and city centres. The Bus Services Bill is very interesting.
We are investing heavily in transport across the UK, but especially in the north as part of our initiative to drive the northern powerhouse. That work is taking place right across modes of transport. We are seeing significant, record-breaking levels of investment and the Department is working in partnership with local bodies, especially Transport for the North, which we will put on to a statutory basis within some months, to make sure that the plans reflect local need, and that we deliver the transport for the area required to make the economy thrive for the future.
Question put and agreed to.
Capsticks Report and NHS Whistleblowing
I beg to move,
That this House has considered whistleblowing in the NHS and the Capsticks report into Liverpool Community Health NHS Trust.
It is a pleasure to serve under your chairmanship today, Mrs Main. On 22 March 2016, the “Quality, safety and management assurance review at Liverpool Community Health NHS Trust” report by Capsticks solicitors was publicly released, following a serious and substantial investigation and examination of the litany of failures, misuse of power, intimidation of staff and patient harm that was allowed to go unchecked and unchallenged at Liverpool Community Health in the four years to April 2014. Some 43 individuals gave evidence to the review over 24 weeks, and almost 900 documents, spanning more than 19,000 pages, were reviewed.
The findings are clear: from 2010 to 2014, the trust’s pursuit of foundation status was its sole priority. The review compares LCH to Mid Staffs on the basis of the brutal tunnel vision that led to an unsafe drive for savings at all costs, compromised the quality of patient care, fostered bullying and harassment of staff on an industrial scale, and made possible the culture of concealment and denial at board level. The report’s findings are even more damning, given that all this took place after Mid Staffs and the publication of the initial Francis report. It demonstrates that, in pockets of the NHS, the events at Mid Staffordshire have changed little if anything at all. It prompts the question, to what extent is this happening in other trusts up and down the country?
The report paints a stark and harrowing picture of far-reaching failure, driven from the very top of the organisations where individuals have escaped the consequences of their actions to date. Sadly, the same cannot be said for the patients and staff of the organisation, which abjectly failed them.
I do not intend to go through the Capsticks report in great detail, as it is publicly available for people to read. Instead, I want to add background detail and put a human face to the words it contains. I want to talk about my experience of what can only be described as the very worst of the national health service.
I got involved in LCH simply because my father was admitted to ward 2A—a GP-led community ward at the Royal Liverpool hospital, run by LCH. The quality of my dad’s care was not great, and despite meeting managers and eventually a doctor, I remained unhappy with the care and remarked that I would speak to the Care Quality Commission. I was very surprised that staff members encouraged me to do so. It was the bravery of the ward staff, who spoke out about the horrific situation at LCH, that led to three years’ work to expose the true situation. And we are not there yet. No whistleblower has come to harm in this investigation, because I took the heat.
Once staff felt able to confide in me, many other people from across the various services with equally horrendous experiences of patient care, mismanagement and staff mistreatment spoke out, too. The Capsticks report enabled their voices to be heard, but it was limited because it was a governance review, not a clinical review. I am seeking investigations by a range of regulatory and professional bodies—including NHS Improvement, the Care Quality Commission, the General Medical Council, the Nursing and Midwifery Council, the Royal College of Nursing, the Health and Care Professions Council, the Chartered Institute of Personnel and Development, the Chartered Institute of Public Finance and Accountancy, and the Health and Safety Executive—into the failures at LCH as an organisation and by individuals.
However, one fundamental question remains unanswered. We still do not know the full extent of the harm caused by LCH. Justice demands a public inquiry, or at least an inquiry in public. We cannot try to hide what went on. A refusal to undertake a clinical assessment of the harm would be an admission that Mid Staffs and the Francis inquiry have changed absolutely nothing, and that the lives lost unnecessarily and prematurely in the care of the NHS had no value. Is that really the state of our NHS in 2016?
Despite the information that I have presented, detailing the extent of failures at LCH, there remains a determination among some members of the NHS senior management to minimise the LCH revelations. They are of the view that the Capsticks report should not have been commissioned, and that the dismantling of the organisation will bring scrutiny of the entire system’s failures to an end. It will not. I promised those who put their trust in me that I would not let that happen. I will keep at this until we have the whole truth and those who are responsible are held to account. The Minister might reflect on why those in senior positions who knew something did not believe that the duty of candour applied to them, and why there seemed to be no consequences.
The Capsticks report paints a stark picture of far-reaching failure that emanated from the top of the organisation, where the pursuit of foundation trust status had consequences for patients and staff at LCH, and financial considerations rode roughshod over the quality of care. A combination of driving down recurring costs and minimising expenditure on front-line services meant that the trust could create the impression of a healthy financial organisation, enabling it to become an FT. All its key performance indicators were financial. No one seemed to notice that all reference to quality disappeared.
Efficiency savings are usually 2% to 4% a year in the NHS. At LCH, there were several services for which the initial cost improvement programme proposed a 50% planned reduction in the overall budget within a single financial year. Those ludicrous budget cuts were described by the interim chief executive as “erratic”—“dangerous” is the word I would use. Those cuts could be driven through because there was a lack of a clear, transparent and robust quality impact assessment process to support the cost improvement programme. The situation was compounded by the executive team’s deception of the trust’s board in the implementation of the cost improvement programme.
The Capsticks report shows no evidence that the board had any discussions about the impact of the CIP on staff and their ability to deliver safe and effective healthcare to patients. Between 2011 and 2014, more than £20 million was stripped out of front-line services. In the district nursing service, there was an underspend of £2.8 million, which meant that some areas were left to run at 50% of safe staffing levels. Stressed nurses worked unpaid long after their shift had finished to ensure that patients received essential treatment and medication. Working alone without alarms, they had to go into houses where there were drugs and guns, having been told by their managers, “That’s your job.”
In 2014, the deluded former chief executive wrote to me that the trust had reduced grade 3 pressure sores by more than 30%, and benchmarked against best practice. The reality was that the number of patients with avoidable, agonising pressure sores, which reach right down to the bone, rose sixfold as nurses frantically scuttled round the city trying to catch up. Staff were put in harm’s way. One nurse was held hostage at knifepoint by the relative of a patient she was visiting, and was seriously sexually assaulted. The attacker was given a custodial sentence.
Clinical governance between 2010 and early 2012 was the responsibility of the director of finance. He had never previously worked in the NHS and had no clinical experience, yet he was responsible for reporting serious untoward incidents to the board. I have been told that even the person in charge of nurse prescribing had no clinical background: he was a fitness instructor.
The incident initially reported to the director of finance was relayed to the chief exec, the human resources director, the medical director, and the director of operations and chief nurse. The executive nurse promised a “root cause analysis”. This never happened; nor was there a proper investigation, which was a breach of trust policy. No one seemed to notice. The director of finance stated as part of the Salmon process that the director of operations and executive nurse, and the health and safety reporting system
“both downplayed the seriousness of the incident.”
The minutes of the board meeting on 23 September 2014, at which the report of the interim chief executive and interim nursing director was presented, state that “CG”—Craig Gradden, the medical director—
“confirmed that it had been reported in the ‘Weekly Meeting of Harm’, but had not been reported to the Board, as it had been risk rated too low”.
So sexual assault of a nurse was risk-rated too low to be reported to the board—it was rated lower than a stolen personal computer or the parking problems at Burlington House.
Questioning the credibility of the medical director, he Capsticks report states:
“We also do not as a review team accept the comments made to us that the serious nature of the incident was not known at the time. Our reading of the Datix entry on this incident clearly indicates the nature and seriousness of the incident.”
The chief executive, Bernie Cuthel, told Capsticks that she was not aware of the severity of the incident, but she managed to send the nurse a handwritten note.
The incident was not reported to the Health and Safety Executive either, presumably because the trust knew that it would be found wanting, as it had no proper lone-worker policy and staff did not have any alarms. Why did staff have no alarms? Because they cost too much money. The trust even charged the nurse who was assaulted for access to the internal investigation records. How the LCH executive directors reacted to that incident demonstrated the utter inhumanity of those shameless individuals. Only under the new leadership has the incident been properly investigated.
There are other failures right across the organisation, where finance was given priority over the quality of care. At one point, the trust’s in-patient services had 33 vacancies and an 11% staff sickness rate. How were they expected to maintain high standards of care? One nurse told me that she was left with one healthcare assistant to look after 18 ill patients, and when a senior manager arrived, his only comment was about the noticeboard.
Poor, ill and often elderly patients were expected to run around the city trying to get appointments to see district nurses. GPs gave me many examples, including that of one lady who, after a hysterectomy, needed an infected wound dressed. She was forced to go daily to different treatment centres in different parts of the city by taxi, because she was not fit to catch a bus; it cost her more than her income for the week. In another case, a patient was left waiting for four months for a health assessment, leaving their lung cancer undiagnosed and eventually inoperable. The equipment service was in disarray: I have seen photographs of wheelchairs for the use of patients stored in a gents toilet.
In prison healthcare services, which the trust ran before 2015, the abject failure of oversight by the board was shocking—shocking in the extreme. The service, including meds management, still requires thorough investigation. Basic health checks for new prisoners to assess their risk of suicide were not carried out, with tragic consequences. The prisons ombudsman was ignored, and the coroner now recognises organisational failure.
Staff, as well as patients, paid the price. Where there was resistance to the planned cost improvements and their consequences, the human resources function was used not to support staff but to enforce, leading to a culture of bullying and harassment. The community dental service faced a cut of £2.7 million, or 49% of its overall budget—a reduction of 50 whole-time equivalent staff. When the clinical directors tried to point out the risks to patient care, they were suspended on concocted grounds and faced disciplinary action in an effort to silence them. There are many more examples.
My first awareness of the bullying culture at LCH was in the intermediate care bed-based unit where my father was admitted. I was told by whistleblowers that nurses in the service who spoke out were bullied, and that three senior members of staff were on suspension without even having been given reasons for their suspension, although that later changed, after challenge, to redeployment in a non-clinical role for no given reason. These matters remained unresolved for more than a year, until the new team arrived. People had been moved out of the way.
Driving home one night after a day of managerial mayhem, one nurse with a family and decades of service to the NHS in a role she loved, pulled her car to the side of the road and seriously contemplated suicide. Another nurse, in the prison service, received foul racist texts from his senior manager. He was appalled and told her so. Little did he realise that that would be the end of his NHS career. He was suspended for more than a year, then sacked and reported to the Nursing and Midwifery Council, although eventually cleared. The manager was not even disciplined.
Management failings went unchallenged. In one particularly shocking case, a whistleblower has alleged that a prisoner with dementia was placed in a tumble dryer at HMP Liverpool for the amusement of prison and health staff. It is alleged that when he tried to get out, it was a nurse who pushed him back in.
The report’s description of scoping meetings is illuminating:
“people…described the culture and atmosphere as being designed to find personal fault and that the presence of a representative from Human Resources at these meetings, which in our view is most unusual, further exacerbated that feeling.”
Staff knew it was dangerous to speak up.
Staff availing themselves of occupational health psychological services were limited to six weeks’ support, but so great was the threat of harm to them, that some were still receiving help for more than a year. The number and severity of these cases was drawn to the attention of LCH executives by the trust providing the services, because they were outside the provider contract and required extra resource. Even that did not make a difference.
The report offers us an insight into the scale of the HR problems that existed: 332 known employee relations cases, including eight cases of bullying and harassment, 111 disciplinary cases, 26 grievances, one whistleblowing, 20 capability cases and 166 sickness sanctions—all that in a small community trust. The view of the interim chief executive offers some insight into those figures:
“When coming across grievances that were in the system, some of them were two or three years out and not resolved. I came across individual members of staff who had been on suspension for up to nine or ten months and the full time officers couldn’t even tell me why they were suspended.”
The mechanisms to protect staff, such as JNCC—joint negotiation and consultative committee—meetings, did not function effectively; they actually gave false assurance. The meetings were attended by the board chair and considered bullying cases regularly, but nothing changed because managers were used to enforce the directives of the executives, and for people who did not do as they were told, there were consequences. Even the ACAS report talked of employees being “fitted up”.
There were cliques, and someone whose face fitted would be invited to join the Friday night Prosecco club, also known as the “Montrose mafia”. When someone was suspended or fired or resigned from the stress of it all, a member of the clique would be moved into the position, without proper process, in order to deliver “the programme”, which also meant overlooking the shortcomings of the executives, which were many. I was always astounded that everyone knew that Helen Lockett did her LCH on-call duty from Bristol. She was not even in Liverpool. Safe? I don’t think so. As one staff member interviewed by the Capsticks team said:
“In fact it’s probably the most un-healthy organisation I’ve ever worked in by some distance at that time. Just because those key individuals…forgot what we were actually…here to do.”
On 5 February 2014, I asked the Prime Minister to forensically examine the history of HR practice, disciplinary action and subsequent payoffs. He said he would happily do so, I believe in good faith, because he thought the CQC could do that, which it turns out it cannot. I ask the Minister, when the HR department is used as a weapon to enforce the rule of a trust, rather than the law of the land, who is policing it?
A vast amount of taxpayers’ money is wasted on paying for lawyers and subsequent compensation for victims as careers and lives are destroyed. The Department of Health and professional bodies such as CIPD surely should act. The evidence of a pervasive culture of bullying and harassment at LCH reinforces Capsticks’ opinion that the executive team were “out of their depth.”
We might think that an executive team that slashed £20 million from front-line services, causing patient and staff harm, would guard every penny. We would be wrong. They spent more than £350,000 on drumming up support for their application for foundation trust status. They spent more than £1 million on a programme management office of external consultants to tell them how to save money. At the trust’s annual meeting in 2013, the same year the board slashed £7 million from front-line services, its leadership team still managed to find enough money to hire jugglers, unicyclists, stilt-walkers and a life-sized elephant to greet guests—I am not kidding. In the same period, the chief executive’s pay increased by nearly a third, from £95,000 to around £130,000 a year.
In 2014, when the CQC at long last began to expose the extent of the leadership failures at LCH, the trust board’s first reaction was to spend £11,000 on a crisis communications consultant. In January 2014, as I pressed hard and still harder for answers and immediate changes for staff and patients, board members spent almost £1,000 on legal advice in an attempt to browbeat me and prevent parliamentary and public scrutiny of the goings-on at LCH.
I mentioned that the executives downgraded the risk rating of the serious sexual assault of a nurse. That was not a one-off: there were other instances in which they were willing to hide failure. The Capsticks report says:
“when risks were escalated upwards, they were either ignored or watered down by those in more senior positions to make them look less significant than they were, without any clear rationale for doing so.”
That included the suppression of a report into district nursing services because its findings were so catastrophic and told the truth. Having requested documents under freedom of information, I have evidence that the nursing director and clinical director signed off the CIP plan that states that they believed those plans to be clinically safe. All the evidence says that those plans were not safe at all.
In hiding their failures, the executives regularly deceived the non-exec directors, as the Capsticks report highlights:
“There were repeated failures by the Executive Directors to be open and transparent with the wider Board, which is ultimately responsible for the care and welfare of its staff. This included not sharing with the Board details of a serious assault carried out on a health care professional and not sharing with the Board the results of a survey of staff views and opinions undertaken by the Staff Side which amongst other things highlighted that 96% of respondents believed bullying was a moderate or worse problem at the Trust.”
The trust chair was present at staff side meetings.
The non-exec directors on the board are also culpable for their failings. The fact that the board was deceived by executive directors should not detract from the catalogue of errors that the non-executives made in fulfilling their duties. Instead of providing the most basic challenge and oversight, the chair of the trust and her fellow non-executive directors were in denial. They were more concerned with protecting their reputation than with protecting patient safety and staff welfare. The chair was reported on many occasions, usually in response to me, as saying:
“The board has complete confidence in the chief executive and her team.”
What is so concerning is the directors’ sheer lack of awareness—never mind acceptance—that they had failed. Capsticks says that its
“detailed review of the public minutes of Board meetings from 2011 until April 2014 do not show that Non-Executive Directors on the Board collectively and individually held the Executive Directors to account. Indeed our extensive review of these minutes shows little evidence of scrutiny and challenge.”
There was an over-reliance by the board on external consultancy reports for assurance on its performance—although ironically, the board ignored the finding of a 2012 report on governance by Deloitte that stated that
“there was an inconsistent level of challenge from Non-Executive Directors on quality”.
They heard only what they wanted to hear.
Paragraph 9.36 of the Capsticks report states:
“The Board and its Committees for their part failed to understand the impact of such a significant Cost Improvement Programme on the quality and staffing of front line services and did not provide the required level of proactive oversight, too willing in our view to accept Executive Director assurance of a process which was largely at variance with that set out in national guidance.”
In paragraph 13.36 of its report, Capsticks comments that
“the Board ignored one of key findings of the Francis Inquiry…which identified ‘an unhealthy and dangerous culture’ as a pervading cause of the failures at Mid Staffordshire NHS Foundation Trust.”
Had any of the opportunities been taken, the subsequent sequence of failures could have been broken. The board could have done something. It should have done something. It did not, and patients and staff came to harm. I do not believe that the non-execs accept to this day their responsibility for the damage that they caused in failing the patients and staff at LCH.
Perhaps equally concerning for the Minister is that the extensive regulatory framework that exists, in the expectation of stopping events such as Mid-Staffs and now LCH, fell down on the job. Nurses who contacted the NMC were simply referred to protocols—although the NMC is currently engaged in resolving some of these issues. This was not the RCN and the other unions’ finest hour. Most absent of all were the NHS Trust Development Authority, which is now called NHS Improvement, and Liverpool and South Sefton clinical commissioning groups.
The clinical commissioning groups in particular have a duty—I quote from NHS England’s rules—to
“make their own assessment of cost improvements and be satisfied that services are safe for patients with no reduction in quality.”
In the case of Liverpool clinical commissioning group, there is no evidence that LCH’s savings plans received even the most basic checks to ensure that they were safe and would not lead to patient and staff harm. For a clinical commissioning group that is responsible for almost £0.75 billion of NHS spending and the future reorganisation of health services in Liverpool, that dereliction of responsibility is deeply disturbing and must prompt the questions, “Is it up to the job?” and “Where else is its eye off the ball?”
The CQC’s previous assessments of the trust did not reveal the bullying or the seriousness of the situation, although after I contacted it, it did produce the first regulatory evidence that all was not well. It also protected the whistleblowers, for which I thank Ann Ford. The lack of any discernible action by the CQC four months after it received the Capsticks report is not good enough. The lack of accountability remains deeply troubling.
The Trust Development Authority in the end removed the chief executive, the executive nurse and the human resources director from their posts following a review by Sir Ian Carruthers. I was led to believe that because of the information that I had provided and the Carruthers review, those individuals had been sacked. That was untrue. The TDA also left the failing non-exec directors in place on the board, and that hindered the trust’s recovery. If the board was failing and the executives had to go, why leave half the board there to hinder the people brought in to make it better?
I am still astounded that I was told that the chief exec had been fired when the truth, elicited by freedom of information, says that she was given a reference and that Manchester mental health trust was asked to mentor her without being told about the full circumstances. Effectively, she had been moved from one job—because she was doing badly—to be mentored at Manchester mental health trust. Currently, she remains safely holed-up in a senior executive role at Betsi Cadwaladr University Health Board, still earning about £106,000. I am told by the Care Quality Commission that her flight across the borders within the United Kingdom prevents it from taking any action.
Gary Andrews, the former director of finance and a non-clinical clinical governance lead, has been given a senior managerial role in NHS England’s vanguard programme. Craig Gradden, LCH’s former medical director, is employed as a medical consultant in Sefton. Helen Lockett, Liverpool Community Health’s former director of nursing, who I was told had been sacked, got a £25,000 pay-off and a reference. Only the 18-month interim order issued by the NMC while she is under investigation stops her practising. Who referred her to the NMC? Was it the system? No, it was me.
Michelle Porteous, the HR director, was allowed to leave unchallenged and was seen to spend her last days at the shredding machine—no one stopped her. Although outside the remit of the NHS and its regulators, the former chair of the trust continues to work with the health service through her management of a charitable company called Health@Work, which sells health and safety advice, training in emotional intelligence, spotting signs and symptoms of poor mental health in staff members and techniques to manage stress. I will say no more.
The Prime Minister said he did not want failures recycled around the NHS, but here we have a regulator doing just that: not investigating, not disciplining and not taking the appropriate sanction, just recycling. Accountability and the interests of patients and NHS staff require action, so I ask the Minister whether the fit and proper person test, introduced to prevent NHS leaders responsible for serious mismanagement from assuming similar roles in the NHS, is fit for the job.
Before I come to my last point, it would be remiss of me not to mention the progress that has been made by LCH in the two years since April 2014. The trust has turned an important corner, through investment in safe staffing levels, a new approach that values clinical leadership, clear action to put quality and patient safety first and a new culture of openness and honesty. To have come so far in such a relatively short period of time is a credit to the frontline staff in LCH and the new leadership it has been given.
Most importantly, while the Capsticks review has shone a light into the dark recesses of the goings on at Liverpool Community Health in those four terrible years before the system acted, it does not, and cannot, document all the harm caused to patients. The Capsticks report finds that it is reasonable to conclude that between 2010 and 2014, patients received sub-optimal care. It is therefore a sad and undeniable fact that there will be people on Merseyside today who have lost loved ones, or seen them suffer, or suffered themselves, who do not know that their anguish was avoidable and caused by the failures of leadership at the trust.
In the interests of truth and justice, we cannot allow that to continue. I therefore look to the Minister for assurances that preferably a public inquiry, and at least an independent clinical review, into patient harm associated with the leadership failings at Liverpool Community Health NHS Trust between 2010 and 2014 will be conducted without further delay and that nothing is hidden. It must be made public. I am very aware that very senior people are really angry that this is coming out.
I also ask the Minister to include, as part of any review, an independent investigation into the adequacy of the actions taken at the same time by NHS Improvement—TDA as it was—NHS England, Liverpool CCG, South Sefton CCG, Southport and Formby CCG and their predecessor organisations to assess and address safety concerns at LCH. That needs to reflect the health system’s future challenges, where accountability and governance will not just affect one organisation but a whole region, area or system. It is only through that course of action that we can provide the assurances necessary to those harmed that that will never be allowed happen again.
In finishing, I ask the Minister—obviously not today—to look at the TDA assessment programme for the break-up of LCH because, for example, Bridgewater, a trust that does not have a CQC rating, is pitching for LCH business against other organisations that do have CQC ratings. That is patently unfair. Also, in the private sector we would not allow a business to poach former members of staff—it is almost insider trading—but that clearly is going on in this process. We must establish whether former members of staff declare their conflict of interest and whether we are protecting NHS organisations from that kind of insider trading.
I am sure that the Minister is aware of how deeply angry and upsetting this is, not just for me—having spent three years looking at it and working hard at it—but for each and every single member of staff who, right now, trusts him to deliver. They were too frightened to go to their execs and they were let down by the system. They were not sure that they could whistleblow in safety—that is why I did it. The system has let people down so badly. No one has been hurt because I did what I did in that way, but that is not right, either. People need to be able to speak freely on behalf of their organisations, their patients and their staff. This is not 21st century health politics.
Unfortunately, this has been a repeating story since Bristol Royal Infirmary in the mid-’90s when Stephen Bolsin, the anaesthetist who raised that issue of poor survival of children having cardiac surgery, ended up in Australia. That has been a repeating theme. Regardless of the GMC telling us that it is our duty to step forward, whoever steps forward is always the one who is suspended or loses their job or suffers detriment in some way.
There are a lot of common themes when we look at Morecambe Bay, Mid Staffs and this case. In some of them, there has been the issue of trying to obtain trust status and going for cost savings. As the hon. Member for West Lancashire (Rosie Cooper) said, we have management chasing one goal while staff should be chasing a different goal: clinical quality. We see the stories of bullying and gagging and we see a coalface under pressure, with things going wrong and, if someone whistleblows, inevitably we hear of detriment: destruction to their reputation and perhaps loss of their job.
In an ideal situation we would rarely ever need to have a whistleblower. We need clinical audit, which audits not just the money but the quality of performance to give quality assurance. At one time here in England we had the Commission for Health Improvement, but that was got rid of back in 2004. When NHS Improvement came out, I thought that was like what we have in Scotland, which is called Healthcare Improvement Scotland, which we have had under one name or another since 2000. However, NHS Improvement just looks at the money, so we still have this business that the money is trumping the quality assurance.
That audit needs to be seen and problems need to be put right as soon as they are reported. Complaints should be seen as something that are used and looked at in every directorate meeting, which is something we do locally in my trust. Datix, which is used north and south of the border, is a way of trying to lower that barrier and to get people used to reporting every routine misstep, whether minor or major, bringing down the barriers to doing that and getting rid of any sense of hierarchy.
From our patient safety initiative in Scotland, we do things like using first names in theatre to try to get rid of that “fear of the prof” or fear of the consultant, so that an orderly who notices something going wrong feels able to speak up and say, “That is the wrong leg. I think we should check the paperwork again.” Once we get into a situation of having things going wrong, we need to enable any member of the team to easily draw attention to it. Traditional in surgery—this will be UK-wide—are morbidity and mortality meetings in which the whole unit will review any death or significant morbidity. That does not tend to exist in other specialties but it ought to—we ought to have it for every stillbirth and for deaths in other specialties. Maybe then we would know exactly how many deaths or major detriments were avoidable. That cannot be done with stats—we have to look at the cases. One of the things I set up in my unit was something we called, to make it easier for everyone, the difficult case review. Any team member—it did not matter who—could put a name in the book for the next difficult case meeting so that that case would be looked at.
Whistleblowers need internal support so they can go and not suffer detriment. We have had the Francis report and we have the freedom to speak up, and I commend the Government for setting up the national guardian system—we are doing something very similar—but what comes back from whistleblowers I meet is they are concerned that the person who has been appointed is an NHS manager. We have to have someone who is utterly outside the system. Most of all, we need to change the culture that is close to the frontline. Management must have clinical governance responsibility, not just financial governance responsibility, so that staff get used to raising issues that are then dealt with, learned from and changed, and that management see that as part of their role.
It is a pleasure to serve under your chairmanship, Mrs Main. I start by paying tribute to my hon. Friend the Member for West Lancashire (Rosie Cooper), who has ploughed what has at times been a very lonely furrow on this issue. She has shown incredible tenacity in pursuing the matter over a number of years. What makes this all the more remarkable is that, despite all of the inspection regimes and safeguards in place, the only reason we are debating this is because she had the courage and the determination to pursue these issues. She made a powerful and lengthy contribution today; I do not use that adjective in a critical way, but to highlight that there is so much that needs to be considered. The debate is certainly not going to be the end of the story. My contribution will perhaps not be as lengthy as on other occasions as I would like to give the Minister as much time as possible to set out how he intends to take matters forward.
At the heart of this is a random occurrence—my hon. Friend attending the trust in question as a result of her father being a patient there—and one can only wonder whether anything would have been done about the situation had she not attended, and had the brave staff on the ward not approached her after that. We heard from her about a whole catalogue of incidents, any of which in isolation ought to have raised alarm bells. When she spoke of the picture across the board, the number of grievances, some taking years to resolved, the suspensions that seem to be used as a punishment rather than the neutral act they are meant to be and the number of complaints of bullying and harassment it is clear that a wider pattern was there. In the words of the report:
“Non-Executive Directors took reassurance too easily and failed to provide sufficient scrutiny and challenge across a number of key areas. They collectively represented a series of missed opportunities to intervene.”
It should be said that there were also repeated failures by the executive directors to be open and transparent with the wider board, which included them not divulging details of a serious assault carried out on a staff member and keeping from the board the results of a staff survey that said 96% of respondents believed bullying was a problem to some degree within the trust. Will the Minister address whether he considers there needs to be more training or support for non-executive directors, so they at least know when they are not getting the whole picture? I also wonder whether there ought to be a requirement for at least one employee representative on each board so that, if there is a culture like this, there is a greater chance of it being revealed. What steps are being taken to prevent those non-executive directors who were involved in this from serving in a similar capacity in future?
The position of the executive directors deserves much sharper criticism, particularly when, as my hon. Friend pointed out, many of the senior people involved have found themselves in employment elsewhere in the NHS, and she quite rightly asked where the individual accountability is. Staff spending their last few days stood at a shredding machine is the sort of thing that goes on in multinational companies that have been cooking the books. It is not what should be happening in an open, transparent and accountable public body. It seems that the human resources team were used as a tool to enforce management’s will rather than to ensure the rules were applied fairly and consistently across the board. It is little wonder in those circumstances that staff did not feel confident that they could raise concerns freely.
I am sure we will talk about the duty of candour, but will the Minister give us assurances that this sort of situation will not happen again? Policies and good intentions can only take us so far, particularly when a culture develops that positively attacks those that raise concerns so that everyone is too frightened to raise those concerns in the first place. In my experience I have seen far too many times people who have legitimate concerns about a practice at their place of work but who do not have the confidence to raise those issues without fear of reprisal. A policy is only as good as the people entrusted to honour it and that is down to the people at the top. They set the tone and they have a duty to ensure that every person who raises a legitimate concern is protected. It only takes one bad experience or one failure to act in good faith on a concern raised and the entire system falls into disrepute.
I am sure that nobody goes into public service with the intention of creating such a culture of fear but it is clear that good intentions can be diverted by other influences and pressures. In this case, the central conclusion in the report, which needs more careful consideration, is that when the trust made the decision to go for foundation status what happened was an
“accompanying focus to reduce costs, which resulted in enormous pressures on many front line services and the emergence of a culture of bullying and harassment of staff at various levels within the organisation and the delivery to some patients of poor and in some cases sub-standard care.”
The report also said:
“For many of these concerns, it is hard to come to any other conclusion than that they were managed in the way they were in order to ensure the Trust application for NHS foundation trust status remained on track.”
That is pretty damning.
Aside from the financial pressures faced, we know that other pressures on staff are not going away, with significant numbers reporting work-related stress. We know that vacancy rates and rota gaps still remain unacceptably high and there are serious problems with staff morale across a whole range of services. I pay tribute to all NHS staff who are working hard in very trying circumstances, but we should also be realistic about the challenges they face. The staff at the trust have been key to delivering the improvements we have already seen, and the latest CQC report recognises that there have been improvements, which is not only a credit to those staff but also to the new leadership team.
It is fair to say that there is clearly still some way to go. For example, the performance of paediatric speech therapy service was worse than at the last inspection to the extent that the trust had to suspend the waiting list for a year. It was also noted that, despite some improvements, too many patients are developing serious pressure ulcers, which is something that ought to be eradicated altogether. Inspectors also highlighted “significant improvements” in the culture of the organisation and praised the trust for the measures it has introduced to keep staff safe, which is clearly one of the biggest and most important changes that was needed.
Whether that change in culture is permanent can only be tested by events, but we should reinforce at every opportunity the importance of speaking out with confidence. In that regard, it appears the future of the national whistleblowing helpline is still being considered. I would like to see the local guardians as complimentary to, rather than a replacement for, the national helpline. I would be grateful if the Minister will address whether any decision has yet been taken on the future of that national helpline.
In conclusion, I add my voice to the calls made by my hon. Friend the Member for West Lancashire for an independent clinical review into patient harm associated with the leadership failings at the trust. We also need an investigation into the adequacy of the actions taken at the same time by NHS Improvement, NHS England, the clinical commissioning groups and their predecessor organisations. Only then can we move into a position from which we can confidently say this is something that will never happen again.
It is a great pleasure to respond to this debate that you are chairing, Mrs Main. I echo the compliments paid by the shadow Minister, the hon. Member for Ellesmere Port and Neston (Justin Madders), to the hon. Member for West Lancashire (Rosie Cooper). The hon. Lady has been very brave in pursuing this cause, which she has taken up on behalf of her constituents. I agree that it is striking that this matter would not have come to the fore had she not had very sad and unfortunate personal experience of the failure of care at Liverpool Community Health. I thank her for her persistence in the face of opposition, not just from the usual quarters but from places that might not have been considered to be inimical to a Labour party Member. That is why I particularly commend her for what she has done and for continuing to fight the cause for her constituents. It is absolutely true that as a result of what she has taken up on their behalf, the care being provided is now safer than it would otherwise have been. Sometimes we need to remind ourselves that doing this job is worth while, and she has done that in great measure for herself and other Members of Parliament.
I would like first to offer an apology. It is right that the Government recognise it when things go wrong even if they are not within the direct control of Ministers. Everything in the NHS is the responsibility ultimately of the Secretary of State and of the ministerial team, and I am sorry that the NHS in this instance let down the hon. Lady’s constituents. At the same time as saying that, I hope that she and other hon. Members recognise that it is partly through the measures put in place by the previous Government that we have been able to flush out some of the problems that she identified. It was a Care Quality Commission inspection, under the new regime, that really began to unearth the problems in LCH, and it has been the tougher management of failing trusts that has meant we have been able to bring reform to this trust quickly. Not all is perfect; not everything is right in terms of the CQC or of the Trust Development Authority or its new iteration, but we are a great deal further forward now than we would have been five years ago. To be completely fair, we would have been further forward five years ago than we would have been 10 years before that. We are on a journey, and I appreciate the collegiate atmosphere that has been created in this debate and elsewhere.
I will answer the specific points and questions, because I do not want to reiterate the excellent exposition given by the hon. Member for West Lancashire. She asks who polices HR departments. The simple answer is that the Care Quality Commission, in its well led domain, as it looks at organisations will continue to look at the quality of leadership within an organisation. I will talk in a second about the kinds of thing that I think it should be looking for in the new round of inspections that it will begin in due course.
The hon. Lady asks about the fit and proper persons test. As it is currently constructed, it is for boards to be judging people by the fit and proper persons test. That is the way I think it should be, and there is consensus on that, but clearly those boards need to be properly constituted and know what they are doing. I think that that gets to the crux of what she is saying.
To answer the point made by the hon. Member for Ellesmere Port and Neston about training for non-executive directors, that is, funnily enough, something we are actively looking at to try to improve the quality of boards precisely so that they can ask the questions that are needed, not just in terms of a fit and proper persons test but in order to hold their executive directors fully to account.
The hon. Member for West Lancashire asks about the need for a review, and I know that that is the main purpose of bringing this matter to the attention of the House. I have commissioned NHS Improvement to do a review or at least to ensure that a review happens. As she will be aware, there has been some discussion about the terms of reference for that. I know that Jim Mackey has talked to her about it; she is in communication with him. I, too, am in communication with Jim and I hope that in the course of the next few weeks I or my successor will ensure that that review is as robust as it needs to be. The hon. Lady knows my view on that, which is that I do not want something excessively expensive and excessively long, because that will serve no one’s interests. We need to get the balance right, so that it is timely and good value for money and we are not taking money out of the NHS that would be better spent on her constituents’ care. If we can get to the root cause of these problems in a timely and efficient manner, that will serve her and her constituents well. I commit myself to ensuring that that happens quickly.
The hon. Lady asks about conflicts of interest. As it happens, NHS England is looking at precisely that at the moment. It is an area that we need to be much better in. However, I hope that as we see an evolving NHS, which is far more about collaborative working than the purist approach to competition that was the drive under the original foundation trust mechanism set up in the early 2000s, it will be less of a problem than she correctly anticipates it might be in this instance.
The hon. Member for Central Ayrshire (Dr Whitford) makes a number of important observations about her experience in Scotland, but I am afraid she is wrong on two points. NHS Improvement is not just interested in money; it is very firmly an improvement agency that deals with quality as well as financial performance. She will know that the two do go hand in hand. The best run trusts tend to be those that look after their money as well as their patients. We can see that relationship in the CQC inspections and their relationship with deficits. I suggest that she speak to the director of quality in NHS Improvement, Dr Mike Durkin, who was moved across from NHS England precisely so that NHS Improvement could become a true quality organisation. I am sure she will know him from the past. He is a globally respected expert in the issues of quality and institutional learning.
The hon. Lady is also wrong to say that the national guardian was an NHS manager. She is one of the leading chief nurses in the NHS, and I am sad that she felt unable to continue with that role. The hon. Lady will be pleased to know that her replacement, Dr Henrietta Hughes, is also a clinician—a practising general practitioner. It is very important that we give the right message to whistleblowers, and that is as much the case in Westminster Hall as it is outside in the public space.
The feedback that I have had from whistleblowers is that they see the new replacement national guardian as someone who is in an NHS manager role, and they feel that that is not sufficiently independent for the national guardian for whistleblowers. They are talking about the new guardian.
The new guardian is a practising GP and her office is deliberately set aside from the Department of Health; it is not part of our structures. The purpose of that is to ensure that the person is independent. I hope that that will give confidence to whistleblowers. I have asked her to make a decision on the helpline, because it is important that she makes that decision, not I, in the future.
Finally, I come to the questions asked by the shadow Minister. He talks about FT status. Much was right about the drive for foundation trusts, but a lot of things went wrong. We saw that at Mid Staffs and we have certainly seen it in this instance. I think that he will have noticed a far more considered approach to the FT pipeline in the past few years than previously. I know from experience of my own hospital, which failed to get FT status but is now a very good hospital, that the two do not necessarily correspond.
In all of this, we have to strike an important balance whereby we ensure that hospitals are performing while spending public money properly. The best hospitals and community care organisations do that by energising their staff, eradicating bullying and harassment and ensuring that people are free to speak up and exercise the duty of candour. That is why the thrust from the Department in the past 18 months to two years has been about living the values of the Francis inquiry. We have been putting that into practice in terms of the duty of candour, the whistleblowing apparatus that we have set up, and freedom to speak up.
We are at the beginning of a long journey. There is much to do to make the NHS the world’s largest learning organisation, but we have begun that process. I hope that the report that comes out—the further clinical review for the hon. Member for West Lancashire and her constituents—will be a further step on that journey, not just to correct and expose the failings in her area, but to ensure that the system as a whole, including the Department of Health, learns from them so that they are not repeated elsewhere and we continue to make the NHS the best healthcare organisation in the world.
May I quickly thank the Minister for his genuine, honest approach? But hearts were dropping—I have been getting texts—during his response about the CQC and HR. All they can do is require improvement—that does not stop this and does not change it. The TDA was supposed to look after boards and it did not spot this failing board.
Motion lapsed, and sitting adjourned without Question put (Standing Order No. 10(14)).