House of Commons
Tuesday 12 December 2017
The House met at half-past Eleven o’clock
[Mr Speaker in the Chair]
Oral Answers to Questions
Business, Energy and Industrial Strategy
The Secretary of State was asked—
Royal Mail Privatisation
Almost all Royal Mail’s 142,000 staff are on permanent contracts and earn above the living wage. Employees own 12% of its shares, and it has been a Times top-50 employer for women for four consecutive years. The Government will protect workers’ rights, ensuring they keep pace with the changing labour market.
Today is postal workers day, and I am sure the House would like to thank all postal workers in Royal Mail and Parcelforce for the good work they do all year round, six days a week, in all kinds of weather across the UK.
Royal Mail was not for sale. Under this Government and privatisation, its employees face worse pay and conditions and attacks on pensions, along with the threat of more job losses. Will the Minister renationalise Royal Mail?
I heartily agree with the hon. Gentleman’s celebration of our postal workers today. As he says, they will deliver in all weather to 29 million addresses across the country over the festive season. I cannot agree, however, that renationalisation is the answer. Royal Mail is in negotiations with the Communication Workers Union, and progress has been made following mediation by Professor Lynette Harris. I assure the hon. Gentleman that there would be a great loss to the postal workers, who, let us not forget, own 12%—
I refer to my entry in the Register of Members’ Financial Interests. As postal workers trudge through the snow this morning, they will have a right to be aggrieved at losing their pensions, while Moya Greene gets paid £1.9 million and gets free flights, paid for by Royal Mail, to Canada. Does the Minister accept that?
I disagree with the hon. Gentleman. The pension scheme, if left unchanged, would result in virtual bankruptcy for Royal Mail. It would require an injection of £1.3 billion annually, against profitability of approximately £700 million. I think he can do the maths himself.
Royal Mail is paying out over £200 million in dividends every year to private shareholders. Last year, the chief executive saw her pay increase by 23%. How can the Government stand by a model of ownership that sees postal workers’ pay being frozen and their pensions left unaffordable?
I understand that Royal Mail’s offer of a pay increase to its workforce is far from frozen. I do not propose to comment much further, however, other than to say that the figures the hon. Gentleman refers to are misleading, because they go way beyond the chief executive’s base salary and include performance-related benefits, which are in line with a position of that stature.
As I said earlier, Royal Mail contributes £400 million a year to the pension scheme and, since privatisation, has provided access to capital of £1.5 billion and converted losses of £49 million into profits of £700 million. I would say that that was a pretty successful record.
My hon. Friend makes a very good point. When Royal Mail was privatised, Amazon was one of Royal Mail’s biggest customers; Amazon is now one of its biggest competitors. So he is absolutely right. More investment in technology and modernisation is required if Royal Mail is to maintain its market position.
All the evidence is that employment standards in Royal Mail and more widely are being driven down, including with job losses and cuts to pensions. Is the Minister seriously arguing that employment standards today are higher than they were at the point of privatisation?
Royal Mail employs a significant number of people in the north of Scotland. Protecting those jobs, and the universal service that the workers deliver, is vital, especially given that, according to Citizens Advice Scotland, more than 1 million Scots face surcharges or late delivery, or are refused delivery altogether, when they buy goods online. Will the Minister commit herself to protecting those Royal Mail jobs, and will she confirm that there will be a review of the regulation of parcel delivery prices to support our rural communities?
The hon. Gentleman has made a good point. Royal Mail is regulated by Ofcom, which benefits everyone involved in the service. The universal postal service includes a parcel service. Companies must have regard to fairness in setting delivery charges, and any failure to be clear to customers before bookings breaches consumer protection law.
Today marks postal workers day, when we thank our posties for their hard work and determination in providing a key public service—not that the Conservatives will take any notice. In a privatised Royal Mail, we have seen 12,000 job losses and proposals to slash pensions by 45%. It is a classic case of “one rule for the rich and another for the rest”. Royal Mail has paid out £70 million in dividends to private shareholders, and that is only in the last six months. Does the Minister still stand by the Government’s decision to privatise Royal Mail?
Electric and Autonomous Vehicles
Two weeks ago I announced the location for the new national Faraday battery scale-up facility, which will be built in Coventry. On the same day, Jaguar Land Rover announced its intention to produce battery electric vehicles in the west midlands, thus bringing the region to the forefront of modern mobility in the United Kingdom.
When it comes to autonomous and electric vehicles, public trust in the exciting technology involved is key to making the most of the opportunities that it presents. What discussions has my right hon. Friend had with industry to combat the Luddites and dispel the mythical fears of that exciting technology that are currently being promoted?
My hon. Friend has made an excellent point. Part of the programme involves test beds to demonstrate the new technologies. The demonstrations will be open to the public so that they can see for themselves, and they will begin in Milton Keynes, Greenwich, Bristol and Coventry. However, people are already experiencing these technologies through satnav, cruise control and automatic parking, and I hope that increasing exposure will reveal their benefits.
The Secretary of State mentioned Jaguar Land Rover. As he will know, Ford in Bridgend, which neighbours my constituency and employs hundreds of workers there, is pulling out of the contract early. Has the Secretary of State had any conversations with Ford about the possibility of converging its lines to produce electric batteries for electric cars?
Britain has the potential to be a world leader in developing the new regulatory standards that will govern electric and autonomous vehicles. Will the Secretary of State work with industry, and with other Departments, to ensure that Britain leads the world and that other countries adopt our standards?
I will indeed. The industrial strategy makes it clear that being at the forefront of the regulatory standards for these new technologies gives us a big advantage. The Automated and Electric Vehicles Bill, which is currently before Parliament, is intended to establish—before most other countries—the right regulatory standards, so that we can make progress with those technologies.
The Secretary of State knows that no assessment of the impact of Brexit on the sector has been carried out by anyone, apart from the RAND Corporation, which told us this morning that this and every other sector will be deeply harmed by Brexit. What does he say in response to that important and thorough investigation?
I think the hon. Gentleman knows that I have continuous discussions with all the sectors for which I am responsible, including the automotive sector. They lead me to make sure that, as part of our negotiating mandate, we get the best possible deal. The agreement achieved in Brussels last week, including the transitional phase, had been pressed for by the automotive sector in particular.
We know that the best way to improve our productivity is by investing in research and development, improving the level of skills in our workforce, upgrading our infrastructure, creating an attractive environment for new and growing businesses, and making sure that every place in the country can prosper. That is exactly what the industrial strategy does.
No: if the hon. Gentleman reads the strategy he will see that there is a commitment to the biggest increase in research and development funding, both private and public sector, that we have ever had in this country. It has been the foundation of our success, and I hope the hon. Gentleman will join me in welcoming the progress we are making to be even better at it.
Productivity in the construction industry is a key requirement of building houses. How will the Secretary of State ensure quality in on and offsite builds for the £1.7 billion investment in construction in the industrial strategy?
I am glad my hon. Friend mentions that, because the construction sector is one of the areas in which there are big opportunities. It has a sector deal that has been concluded as part of the industrial strategy, and representatives of the sector have said that this represents a major opportunity, especially in offsite manufacture.
The Secretary of State has just touched on the sector deals the Government are agreeing with different sectors of the economy. Some of the sectors with the lowest productivity, such as retail, hospitality and social care, do not have a sector deal, yet if we close the productivity gap in those sectors, we will help boost productivity overall compared with our main competitors. What are the Government doing to secure sector deals in those sectors?
I am delighted to hear the hon. Lady’s endorsement of that, and she is absolutely right that there is an opportunity for sector deals for many sectors, including those she mentioned. We are already in discussions with many of those sectors, including the food and drink sector and the hospitality sector; we expect to see early sector deals concluded in them. I am delighted that the hon. Lady supports that.
I congratulate the Secretary of State on launching the industrial strategy—in particular the life sciences sector deal, which has already triggered £1 billion of new investment. Does he agree that the key now is to negotiate a Brexit deal that avoids a cliff edge but gives us the regulatory freedom to continue to lead in the all-important genomics and data of tomorrow’s medicine?
I do agree with that, and I commend my hon. Friend as the former life sciences Minister who saw before many people the opportunities of the strategic approach. I think he has been honoured this very week by the learned societies for his contribution to promoting science in Parliament, and I congratulate him on that. He is absolutely right that we need to build on these successes. The life sciences sector deal is a demonstration that a long-term strategy can have immediate benefits; we have had more than £1 billion of investment on the basis of the confidence that the sector has in the strategy we have set out.
With a few notable exceptions, I am sure we would all agree that technology has improved the productivity of this House, but the same is not true for our country: productivity has stagnated since 2010, and we produce 25% less in an hour than the Germans and French, crippling business and making us all poorer. Last week the Chancellor tried to blame disabled workers, but his own Budget fails to invest in science and productivity until 2021. Will the Secretary of State admit that the Chancellor’s ideological austerity, meaning we fail to invest in our engines of economic growth, is the real handicap here?
I do not agree with the hon. Lady, and if she reads the industrial strategy she will see that the biggest increase in science and innovation investment for 40 years has been triggered by this. It is the right way to go, and it has been welcomed by all parties across the country. It would be helpful if the hon. Lady recognised that many other countries have benefited from a strong national commitment to improving investment in productivity, such as through science and innovation, and that gives confidence to overseas investors.
Renewable Energy (Scotland)
Over a third of projects supported by contracts for difference are located in Scotland. In October, we announced plans to allow wind projects on the remote islands of Scotland to compete for support in the next auction. We have submitted a notification of our plans to the European Commission.
My constituency has much going for it, including an abundance of wind and water, making it an ideal place for all kinds of renewable energy projects. What will the Government do to provide revenue support to renewable energy companies during the innovation period while they work to bring down costs?
In the EU, we have benefited from funding from the European Investment Bank, which has contributed to the development of renewable energy generation in Scotland, including through a £525 million loan for the Beatrice wind farm project off the Caithness coast. Can the Minister reassure the House that the UK will continue to participate in and have access to the capital provided by the European Investment Bank after Brexit?
Like the hon. Lady, I commend what the European Investment Bank has done, but the Government are totally committed to renewables and to our own investment in getting a carbon free environment in the way that has been very successful over the last few years.
Can the Minister confirm that up to £557 million will be made available for less established renewable electricity projects as part of the clean growth strategy, and that projects in Scotland will be able to compete for their share of that fund?
Support from the Government will be required to get marine renewables such as wave and tidal power to the point of commercialisation. Renewables UK has come up with a proposal for innovation power purchase agreements. What is the Government’s view of that?
It is important that this much-needed report gets the consideration it deserves and that we take action where needed. In the industrial strategy, the Secretary of State took responsibility for improving quality of work in the UK and continued an important dialogue on this issue. We will publish our full response shortly.
The TUC reports that 3.2 million people are now in insecure work—an increase of more than a quarter over the past five years. Will the Minister accept Matthew Taylor’s recommendation, endorsed by the Select Committee, that a longer break in service—a month rather than a week, as at present—should be allowed before there is any loss of employment rights?
That will be something that we consult on as we consult on the vast majority of the other proposals in the Taylor review. Taylor acknowledges the excellent track record of employment in terms of new jobs, but as the right hon. Gentleman rightly points out—and the TUC endorses this—there is an issue with insecure work and far too much risk being transferred to the employee.
The Taylor review says that the same basic principles should apply to all forms of employment in the UK. Does my hon. Friend see paid time off for women attending antenatal appointments as a basic principle, and does she agree that, for health reasons, the law needs to clearly extend that principle to all female workers?
I welcomed last week the Government’s latest round of naming and shaming employers that have failed to pay the minimum wage—an area where state enforcement has actually had some success—so I urge the Minister to respond positively to the Taylor review’s recommendation that state enforcement of employment rights should be enhanced beyond just the minimum wage.
Insecure working practices at Uber enable the company to engage in a pricing policy that many of my constituents consider to be predatory and designed to drive out competition. What more can the Government do to improve working practices at Uber and ensure fairer competition between taxis and private hire vehicles?
Recent reports uncovered the fact that people driving on behalf of Amazon were forced to deliver up to 200 parcels a day while earning less than the minimum wage. With impossible schedules that left little to no time for breaks and no access to paid holidays or sick pay, many drivers experienced conditions that could be described as Dickensian. As yet another high-profile employment case emerges, why are the Government not taking robust action to crack down on bogus self-employment and to enforce employment rights?
The hon. Lady puts her finger on precisely why the Prime Minister commissioned the Taylor review in the first place. When employers are indulging in practices such as those the hon. Lady outlines there will definitely be a deleterious effect on employees’ health, and they should be roundly condemned.
The Government keep hiding behind their forthcoming response to the Taylor review, but Sir David Metcalf, the Government’s director of labour market enforcement, stated this year that even the Government’s existing powers have not been used to protect workers, despite numerous official statements that the Government have taken abuse by employers seriously. Only last week, the Government identified 16,000 workers who were paid less than the minimum wage, and yet the Low Pay Commission believes that the true figure is between 300,000 and 580,000. Does the Minister agree with Sir David Metcalf that the Government’s enforcement of basic employment rights is wholly inadequate?
I await the publication of Sir David’s strategy for dealing with labour market enforcement, which we expect to see in the first quarter of next year. I am pleased with his appointment, and he is doing a great job so far of bringing together the enforcement agencies at the Government’s disposal to ensure that they work even more effectively in the pursuit of non-compliance with the law.
We are leading the world by ending unabated coal generation in Great Britain by 2025, and our consultation document published last year set out our estimate that that could guarantee savings of up to 124 million tonnes of carbon dioxide between 2016 and 2030.
Further exploration of the North sea for oil and gas was given a boost in the Budget. Gas is a lower emitter of greenhouse gases and is a better alternative to coal, so will the Minister focus on oil and gas in particular when developing the industrial strategy?
We absolutely will. While the move towards clean growth is clear, the White Paper sets out that oil and gas remain one of the economy’s most productive sectors and refers to the intelligent use of its assets and expertise. I thank my hon. Friend for joining me on a visit to Aberdeen; we saw the prospects for the green economy, where sweating the assets is already leading to innovation.
Unlike Wales’ ambitious targets for moving towards low carbon generation in onshore wind, the lack of ambition shown by the UK Government is startling. Will the Minister confirm whether Welsh wind projects will be eligible in any future contract for difference pot 1 auction, which he has already confirmed for projects in Scotland?
My hon. Friend should be reassured that nothing would please me more than coming to Frome in Somerset to see the work that he has done locally. The clean growth strategy sets out how the UK is leading the world on carbon emissions, and we have set out how the Government will invest more than £2.5 billion in low-carbon innovation between 2015 and 2021.
Major banks have lent £630 billion to build new coal-powered stations across the world, many of them in our competitor countries. What assessment has the Minister made of the cost of electricity for the competitiveness of businesses in the UK and does he not recognise that our attempts to save the world while the rest of the world is gaily building power stations fuelled by coal only damage our economy?
The hon. Gentleman is probably aware that we commissioned the Helm review of all the different costs of energy. We believe in a mixed use strategy for energy, and he must also understand the employment and economic advantages of the development of alternative energy sources, quite apart from the carbon-free advantages.
There is a lot of chuntering from a sedentary position, which I will not take any notice of. I would like to answer the question if Opposition Members will allow me.
My hon. Friend should know that the cost of renewable energy is coming down. The cost of electricity from offshore wind farms, for example, has halved in price since they were first introduced. The Opposition may interpret this to mean that my hon. Friend is wrong. I would say that he is not wrong but he needs further education on this subject, and I will be delighted to meet him at any time to discuss it.
Small Business Sector
Through the industrial strategy we will drive over £20 billion of investment in innovative and high growth businesses. We will increase the national productivity investment fund to £31 billion. We are working to ensure that small and medium-sized enterprises win more public sector contracts to enjoy the benefits of that investment.
My hon. Friend the Minister will know that many local authorities have reliefs, including small business relief, which they could use. Unfortunately, not all local authorities are using them. Will my hon. Friend say what the Government could do to encourage local authorities to use those reliefs so that all small businesses benefit?
The Department for Communities and Local Government has issued clear advice to councils that will enable them to calculate the relief that is payable to businesses in the current year. I urge them to pay heed to that advice and implement it. My hon. Friend may be interested to know that Merton council has been allocated £459,000 of business rates discretionary relief in the current year.
Many small businesses are in catering and hospitality, and we of course wish them well, but when we leave a tip for staff we expect it to be paid to them, so when will the Minister publish the report on fair tips so that we can ensure that workers get paid properly?
The hon. Lady rightly raises an important issue. Following the commissioning of the work on tipping, we have issued guidance and publicised the issue. What was happening was grossly unfair. I am glad to report that there has been a significant improvement since we commissioned the review.
Unfair trading practices used by big retailers have been identified as a factor in limiting the growth of small and new businesses supplying to the groceries sector. Will the Minister therefore reassure me that the Department will be bringing forward proposals to widen the remit of the Groceries Code Adjudicator in its response to this year’s consultation?
We will be publishing our response to this year’s consultation on the future of the Groceries Code Adjudicator early next year. I have already committed to meeting my hon. Friend to discuss this with the Minister for Agriculture, Fisheries and Food, my hon. Friend Member for Camborne and Redruth (George Eustice), and I look forward to that meeting.
Small business growth has been made more difficult due to the decision of the Royal Bank of Scotland to close 269 branches, which has been described as a “hammer blow” by the Federation of Small Businesses policy convenor in Scotland, who says that
“these changes will make it more difficult to run a business in much of Scotland”.
Will the Minister commit to working with the bank and her colleagues in the Treasury to ensure that the businesses and communities these branches serve are not left without the banking services they require?
The hon. Gentleman raises a crucial point of concern to communities across the country. Although there is limited action the Government can take on how banks run their businesses, we have worked with the Post Office to enable it, through its 11,600 branches nationwide, to run a full complement of services
Despite having the fifth biggest economy in the world—soon to be the sixth—the UK is ranked only 48th in the global enterprise league; 48th out of five really takes some doing. But this is not just about the lack of support for start-ups. Among small and medium-sized enterprises business confidence is falling and costs are rising, and, as the Bank of England’s figures show, access to finance is still at its lowest level since 2010. Do the Government have any excuse for their woeful failure to support our smallest businesses?
The hon. Gentleman really should stop talking small businesses down, and he is absolutely wrong in his estimate. The UK is No. 4 in the world for being the best place to start a business, and the OECD figures show that we score highly on enterprise. He does raise a valid point about growth, and we need to improve our record in supporting small businesses to grow, which is precisely why the Chancellor has made available a vast amount of money in this year’s Budget to support the growth of small businesses.[Official Report, 8 January 2018, Vol. 634, c. 2MC.]
UK Automotive Sector
The UK’s automotive industry is a great British success story and, building on the success of institutes such as the Advanced Propulsion Centre, we have agreed an automotive sector deal to ensure that we continue to reap the benefits from the transition to ultra-low and zero-emission vehicles. Our ambition is to build innovative and competitive supply chains to increase the value of UK content from about a third in 2011 to more than half by 2022.
Both Honda and BMW have been part of the sectoral council that has helped to create institutions that have trained people, and developed research and development; they are a very valued part of the sector deal, which has been so warmly welcomed by the industry.
My constituency contains many small businesses involved in the supply chains for the motor industry. These chains stretch right across Europe and are largely regulated by European Union law. Will the Secretary of State make a commitment that these will not be disrupted by Britain’s exit from the EU?
Given what he said, I hope the hon. Gentleman will welcome the supply chain initiative, which is at the heart of the sector deal to increase the level of UK content. But one way or another the motor industry, like so many others, is based on its good relations, not just across Europe, but around the world, and it is essential that the deal we do allows that to continue and indeed to prosper in the future.
The west midlands has a proud heritage in the automotive sector, and I welcome the Government’s recent announcements, which will see the region be a global leader in the sector. Does my right hon. Friend agree that supporting innovation and new technologies is key to addressing productivity and creating higher-skilled, well-paid jobs?
My hon. Friend is absolutely right on that, and the commitment we have made to being the world centre for research in new battery technology, through the Faraday challenge, is already commanding attention right around the world. The investment in skills that accompanies this strategy will make sure that her constituents and others in the region will benefit from the jobs that result.
Every day, around £35 million-worth of components are imported to the UK from the EU for “just in time” delivery to plants. Many of those components help to build more than 6,500 cars and nearly 10,000 engines to be re-exported back into the EU. As we saw from the Operation Stack debacle a couple of years ago, it does not take much for disruption at the channel ports to completely clog up the south-east, losing millions and millions of pounds. What guarantee can the Secretary of State give the automotive sector that Brexit will not result in any extra customs checks that will clog up the industry?
The hon. Gentleman is right to highlight the importance of ensuring that the agreement we reach will be free not only of tariffs but of the types of frictions he describes. It is important for our successful industry, and not just the automotive sector, that that is the deal we conclude. I hope he will welcome the progress that was made towards that deal last week.
The industrial strategy White Paper highlighted the emphatic support for sector deals, encouraging any sector to come forward with proposals on how, working in partnership with the Government, that sector can grow and increase its investment, productivity and earning power. A number of sectors have signalled their interest in developing a sector deal, including, as my hon. Friend knows, the ceramics sector.
Very good progress is being made with the leaders of the ceramics sector, of which there is a significant cluster in north Staffordshire and Stoke-on-Trent, where Dr Laura Cohen leads the sector. In the months ahead, we hope and expect to be able to conclude a deal with the sector that will capitalise on the enormous opportunity, especially given the new uses of ceramics in, for example, the medical sector.
The Government are not just a funder and a regulator; they are also a customer. Would it help if national and local government acted like they do in every other country and bought vehicles built in this country by British workers, thereby supporting the companies and British workers?
The most important thing is that we have excellent products here, and I am proud to say that we do in the automotive sector. The right hon. Gentleman will be aware that the Government changed the procurement guidelines to allow the importance of local impact to be taken into account. I hope he welcomes that.
Thanks to the actions of this Government, it is widely recognised that the UK now has the most fiscally attractive regime in the world for investment in oil and gas. Does my right hon. Friend agree that a good sector deal would build on that and would mean that the north-east of Scotland could look forward to a future in which it is not only Europe’s energy capital, but the world’s?
I completely agree with my hon. Friend. I had the privilege of leading a trade delegation to India that included many companies from Aberdeen and the north-east of Scotland that are selling their wares and expertise right around the world. That is one of the big opportunities in the deal that is being negotiated.
Carbon Reduction Targets
The UK was the first country to introduce legally binding emissions reduction targets through the Climate Change Act 2008. We have made excellent progress towards meeting our targets: we met our first carbon budget and are on track to exceed the second and third.
In the recent Budget the Treasury, I assume following consultation with the Minister’s Department, pulled the plug on all future support for renewable energy deployment except for the already allocated near-term support for offshore wind. Does the Minister himself support such action, and does it help or hinder the UK’s progress towards meeting its carbon reduction targets?
As I have said, our position is that we have met our first carbon target, and we are on track to exceed the second and third. The Government are taking this agenda exceptionally seriously. In fact we are leading the world on it, having legislated with the Climate Change Act and put clean growth at the very heart of this country’s industrial strategy.
Industrial Strategy (Wales)
Our industrial strategy is for the whole United Kingdom. I was pleased to hear from, and work with, people, businesses and institutions in Wales and colleagues in the Welsh Government as we developed the strategy. I have held important discussions with Welsh businesses from a range of sectors, including life sciences, steel and nuclear. Welsh innovators are well placed to benefit from the second wave of the industrial strategy challenge fund.
In the past 10 years of successive Westminster Governments, productivity in my county of Gwynedd has fallen by 10%, while productivity in central London has risen by more than 5%. Such regional inequality is evidence that Westminster is not working for Wales. Does the Minister agree that we should be seeking the tools to build our own future?
The hon. Lady is right in identifying that there are big regional disparities in productivity, and the long-term purpose of the industrial strategy is to work together with our leaders right across the country, with industries, and with universities and colleges to make sure that the drivers of improved productivity are in place. I know that the Government in Wales have participated in and endorsed the approach that we are taking, and I take her endorsement of our direction as further encouragement.
Offshore Wind Industry
The UK is the world’s largest offshore wind market and will remain so for the foreseeable future. The contracts for difference announced in September will support more offshore wind deployment in the UK than Denmark and the Netherlands have in their last four auctions combined.
I am grateful to the Minister for his reply. Offshore wind has been of significant benefit to my constituency, but will he outline the work that the Government are doing to ensure that UK fabricators, such as Sembmarine SLP in Lowestoft, have every opportunity to participate in this great British success story?
I am delighted that companies in Lowestoft, such as Sembmarine, are benefiting from offshore wind projects off the east coast. I met several of them earlier this year, thanks to my hon. Friend’s invitation, at the East of England Energy Group event in October. Developers must submit a supply chain plan before entering into a CfD auction.
The north Wales coast is one of the key offshore wind sectors in the whole world, never mind the United Kingdom. Ministers announced £557 million for renewable energy in the Budget a few weeks ago. How much of that will go towards renewable offshore energy?
Civil Nuclear Police Authority (State Pension Age)
The pension age for civil nuclear constabulary officers was agreed by Parliament in 2013. I have met both the chief constable and the chair of the Civil Nuclear Police Authority to hear their concerns about the planned increase to the pension age. After listening to their concerns, my officials are preparing an equality impact assessment. Additionally, I have arranged to meet the Civil Nuclear Police Federation early in the new year.
Stuart, a firearms officer in the Civil Nuclear Constabulary who works in Torness in my constituency, asks, like many such officers, why he is any different from the police who protect us from terrorists on the street when he is protecting a cornerstone of our power industry.
Since we last met, my ministerial colleagues and I have launched the industrial strategy White Paper, and we can already see it in action. Last week we launched the first sector deal with the life sciences sector, which has attracted significant investment in the UK from companies including MSD and GlaxoSmithKline. We are determined to do even more, and to make the UK the best place to start and grow a business.
Many colleagues from both sides of the House joined us in celebrating Small Business Saturday on 2 December. I congratulate the organisers of that great event, which saw more than three quarters of a billion pounds spent with small businesses.
I attended the global forum on steel excess capacity in Berlin, which agreed actions by all G20 nations to tackle unfair subsidies. Today, colleagues will have noticed that the Minister for Climate Change and Industry is accompanying the Prime Minister to President Macron’s One Planet summit in Paris.
My hon. Friend is absolutely right. That is why we have the Automated and Electric Vehicles Bill before Parliament. We are taking a lead in ensuring not only that we invest in research and development, but that we are ahead of the world in having the right regulatory system to support the adoption of this technology.
UK participation in Horizon 2020 has held up remarkably well since June 2016. We remain one of the strongest performers across the EU system. As the hon. Lady will have seen, last Friday’s joint report between the Commission and the UK Government painted a very positive outlook for our continued participation in this valuable programme.
I agree with my hon. Friend. That is one reason why we have established a series of test beds between London and the west midlands, including the motorsport cluster. They are already attracting huge interest from around the world, reinforcing our reputation in the field.
The renewables strategy that we have set out has been remarkably successful in bringing down the price of onshore wind and creating jobs, including in Scotland. As the hon. Gentleman knows, I have discussions with the Scottish Government, which have resulted in the remote islands policy that we have adopted. I will continue to have those discussions with his colleagues.
Sound regulation is crucial to businesses, workers and consumers. Approximately 1.4 million small and medium-sized enterprises export directly or indirectly to countries in the EU, and they will have a keen interest in the outcome of our trade negotiations.
I am delighted that my hon. Friend draws attention to this area, and he is a great expert in it. He will know that, in the industrial strategy, we established as one of the four grand challenges leadership in the world in artificial intelligence and the analysis of big data. A crucial part of that is making sure that our young people and people retraining have the skills to take up those jobs.
I can assure the hon. Lady that nuclear decommissioning is a very important part of the scenery and will be for many years to come.
I have regular and fruitful conversations with the Transport Secretary. My hon. Friend will know that, in Greater Manchester, as part of the industrial strategy, there was an investment of a quarter of a billion pounds in improving connections in and around the city. That is on top of the investment in connections across the north of England.
Given the time that has passed since the promise of an energy price cap, will the Secretary of State confirm that he remains committed to implementing the cap for 17 million households, and will he outline the process by which the Conservative party is expected to introduce it?
We have published an important Bill, and we have requested Ofgem to develop proposals as we progress with it. The Business, Energy and Industrial Strategy Committee is scrutinising our draft legislation, which we intend to bring to the House at the earliest opportunity.
Last week I was pleased to welcome a delegation from Taiwan to my constituency to meet businesses in the offshore renewables sector, and the delegation regarded the way the sector has developed in the UK as a model. Will the Minister outline what support is available to small and medium-sized businesses involved in the supply chain in this country that want to extend to countries abroad?
The Secretary of State may know that Unite the union officials from the Belfast Bombardier plant are in Washington and Montreal pressing the case against the egregious US tariff situation. Is the Secretary of State continuing to engage in this process and working towards a sensible resolution?
I certainly am. As the hon. Gentleman knows, throughout this process we have been absolutely determined to send a clear message to Boeing and to the US Administration that this action is unfair. Its effects on Belfast are intolerable. I will have further conversations later this week to continue to press the case with all the parties concerned.
I recently visited the Cambridge biomedical campus, which brings together academia, business and healthcare. Does the Minister agree that this is important collaboration, which will help boost productivity, improve our economy and create jobs for the future?
It is good news that the Prime Minister is attending President Macron’s summit on climate change in Paris today, but may I warn the Secretary of State that President Macron is positioning Paris as the world’s leader in green finance? To tackle that threat and to protect London, Ministers must back the Bank of England’s taskforce on climate-related financial disclosures and bring in new mandatory corporate requirements on fossil fuel assets.
Britain leads the world in climate finance, and one of the major contributions the Prime Minister and the Minister for Climate Change and Industry are making is in promoting the availability of green finance in the UK—that includes Edinburgh as well as London. That is getting a very good reception.
The Secretary of State has already spoken about the great news for the west midlands on electric vehicles. He will remember the all-new electric taxi being manufactured at Antsy Park in my constituency, and the taxi was certified for use in London this week. Does he agree that the opportunity for a platform for a delivery vehicle is also very important?
Access to finance is critical for small businesses, but the protection in place when things go wrong is non-existent. Do the Government agree, and will they look at extending the role and remit of the Financial Conduct Authority in that regard?
I do indeed. One of the features of our industrial strategy, which takes an approach that previous business policies have not taken sufficient account of over many decades, is the importance of the skills and clusters of industries in local places. As my hon. Friend knows, that is very much at the heart of the industrial strategy that we have published.
On 8 March, the Chancellor announced a full review of business rates. On 14 March, the Minister responsible for small business said:
“The review will report in due course and in the not-too-distant future.”—[Official Report, 14 March 2017; Vol. 623, c. 178.]
Yet the industrial strategy barely mentions business rates, which are having a massive impact on businesses in York. When will this review start?
King’s College Hospital Foundation Trust
Order. I have selected the urgent question because I judge it to be urgent. However, I should advise the House that it is focused very much on London, and I have that in mind. I am sensitive to the interest in the subject, but I am conscious also that we have other business that will run for several hours and in which there is intense interest. That is a guide to the House that I do not intend to run the urgent question beyond approximately half an hour.
I would like to begin by paying tribute to Lord Kerslake, whom I have met in his role as chair of King’s, which he has served with great commitment for two years during a period of significant challenge. While we may differ on some matters of policy, this should not blind us to the service that he has given to the NHS.
The context of Lord Kerslake’s departure from King’s is the very real financial challenges faced by the trust and the way in which these have or have not been addressed. A number of other trusts have similar challenges, but none has deteriorated as far or as fast as King’s, especially in the past few months. This is why it was placed into financial special measures by NHS Improvement yesterday.
There has been a consistent pattern of financial projections by the trust that have not been met during Lord Kerslake’s tenure as chairman. In 2016-17, a planned deficit of £1.6 million deteriorated over the year to an actual deficit of £59.6 million. For the current year, a budget deficit of £38.8 million was agreed in May. At month 5, the chairman confirmed to NHS Improvement that the trust was on track to meet this deficit, but by October there had been significant deterioration in the trust’s position, with a projected deficit of £70.6 million at October—£32.l million worse than planned. NHS Improvement was informed last week that this had deteriorated further to a mid-case projection of a deficit of £92.2 million, which would be £53.4 million worse than the original planned deficit. Indeed, Lord Kerslake indicated that the final position could be even worse.
King’s is receiving substantial financial support from the Department of Health. During this financial year, the trust is receiving £135 million of support to maintain frontline services. That is the second highest level of support across England. Both the level of deficit and the speed of deterioration are unacceptable, as I am sure all hon. Members will agree. Although no trust or hospital is an island, it is right that those charged with leading it should take responsibility for such results. The chief financial officer and chief operating officer both resigned last month, and, as we know, Lord Kerslake left on Sunday.
The trust will now receive even more support with the appointment of a financial improvement director. The organisation will be required to implement a plan to improve its finances, which will be closely monitored by NHS Improvement. On top of special measures and subject to due process, NHS Improvement intends to appoint Ian Smith as a new and experienced interim chair for King’s to take control of the organisation’s position.
Does the Minister not realise that the problem at King’s is not the leadership, any more than it is the growing number of patients or the dedicated staff? The problem at King’s is that there is not enough money. He shows no recognition of the fact that over the past two years, King’s has already cut £80 million—double the rate that other hospitals have had to cut—and taken on an ailing trust to help out the wider NHS. King’s is now being told that it has to make even further cuts. How can it keep its A&E waiting times down, prevent waiting lists from growing and continue to meet cancer targets if it goes on to make further cuts?
Will the Minister face up to the fact that problems caused by lack of money are simply not going to be solved by blaming the leadership? King’s is an amazing hospital and a specialist world centre of research, which is also there for local people. It was there after the Grenfell Tower fire and the terrorist incidents we have had in London. Is it too much to ask the Government to recognise the reality of the situation and pull back from imposing further cuts, which will make patients suffer? No amount of changing the faces at the top will make that difference. It is the Minister’s responsibility.
The right hon. and learned Lady said on the radio yesterday,
“just because they’re the regulator, when these judgments have to be made, doesn’t mean that they are actually right”.
I have to ask her about that, in the light of the comments made by NHSI, the regulator. I will give her a couple of quotes. Jim Mackey, who was until recently the chief executive of NHSI, has said:
“Honestly, I don’t think they have in my time hit a single set of their re-forecasted numbers”.
The current chief executive, Ian Dalton, has said that no other trust in the country
“has shown the sheer scale and pace of the deterioration at King’s”.
This is not just about the numbers; it is about the way in which the trust is managed.
I am grateful to my hon. Friend, because I can confirm that the NHS is receiving record levels of funding, in advance of the plan that was agreed with the NHS chief executive for the five year forward view. That was front-loaded for the five years, so the NHS has received increases of funding for the first three of those five years over and above what was requested.
Lord Kerslake has said that the Government are
“simply not facing up to the enormous challenge the NHS is currently facing”.
We agree. The Nuffield Trust has today called King’s
“the canary down the coalmine”
for NHS finances. Hospitals across London and beyond have been forced to cut costs by 4% a year since 2011, yet the report that Ministers commissioned from Lord Carter advised that trusts should find savings of 2% a year.
Does the Minister agree with NHS Providers, which warns that the saving hospitals have been ordered to find
“risks the quality of patient care”?
He will know that, by September this year, 83% of acute hospital trusts were in deficit to the tune of £1.5 billion. Does he agree that these deficits, across London and beyond, are a consequence of Government underfunding, cuts to tariffs and the failure to get a grip of delayed transfers of care because of the £6 billion of cuts to social care? Does he expect delayed transfers of care to increase in the coming weeks, and will trusts again be ordered to cancel elective operations this winter?
Before the Budget, the NHS argued publicly for an extra £4 billion in revenue a year. Why did the Chancellor refuse to give the NHS the extra funding that Simon Stevens asked for? Lord Kerslake has said that our NHS faces the
“tightest spending figures in recent times”.
Does that not mean that, as at King’s, there will be continued hospital deficits, growing waiting lists, greater rationing of care, the dropping of the 18-week target, more privatisation and an NHS pushed to the brink because of this Government’ persistent underfunding? Do patients not deserve better?
I think the hon. Gentleman’s critique would have a shade more credibility if he acknowledged that, before the 2015 election, the then shadow Health Secretary indicated that he wanted £5.5 billion less for the NHS than my party was offering. If we had followed that prescription, the financial position of the NHS would be far worse.
The hon. Gentleman asked about delayed transfers of care. In March, the Chancellor gave an additional £2 billion to the adult social care system, precisely targeted on reducing DTOC, and significant progress is being made in freeing up beds across the system. He also asked about NHS funding in the most recent Budget. The Chancellor awarded an additional £2.8 billion in revenue support for this year, next year and the following year, and a further £3.5 billion of capital to support programmes.
As a London MP, I know that other hospitals that have faced challenging situations have put in place improvement plans and met the targets set by NHSI. If the regulator had not acted yesterday, would it not have been letting down other London hospitals and my constituents?
My hon. Friend is quite right. There has to be a sense of responsibility and accountability for delivering on budget deficits—if they are deficits—that have been agreed between the regulator and the trust. That is happening up and down the country, and it would be unfair on other trusts and other areas of the country if one trust was allowed to get away with its performance unchecked.
The key to this question has to be ensuring sustainable delivery of the NHS. The Minister may wish to look at the model in Scotland, where we have boosted investment and listened to the needs of our healthcare workers. By stark contrast, the UK Government seem intent on burning their bridges with NHS staff with their cost cutting and special financial measures. When will the UK Government wake up and realise that their ideologically driven austerity threatens the very future of our NHS?
My local hospital trust, based on Northwick Park Hospital, has had to make some very difficult decisions to make itself more efficient and to reduce its deficit, and it has done so under excellent leadership. Does my hon. Friend know whether decisions were taken at King’s to keep to the deficit target? Were efficiencies made, and how effective were they?
What is particularly disappointing about King’s is that it does have a cost improvement programme, but regrettably, it has not been able to keep to it. It is particularly surprising that, as recently as October, the senior leadership team indicated that they were on track to meet their deficit, which palpably, as we now realise, was not the case.
King’s College Hospital is in my constituency, and I can tell the Minister that the roots of this current financial crisis go back to 2013, with the collapse of the South London Healthcare NHS Trust and the decision to incorporate two additional hospitals, which were failing in their services, into the King’s trust without adequate funding to support that decision. This has been followed by year-on-year, real-terms revenue cuts and next-to-zero capital funding, while demand and need in our community is going up all the time. Instead of scapegoating a well-respected public servant, will the Minister listen to his wake-up call and look again at holding a full review of the finances for King’s College Hospital, and will he give the trust the resources it needs, so that the exceptional doctors and nurses who work for it can deliver the care and treatment that patients need and deserve?
I share the hon. Lady’s support for the clinicians and professionals working in her trust, who are doing the best job they can in admittedly challenging circumstances. I do not accept her characterisation of a lack of capital provided to King’s. I have been there myself and seen some of the building work going on. I am happy to look at the circumstances surrounding what happened in 2013, but they are not as relevant to today’s situation as the way the trust’s financial management has deteriorated in recent months.
As I have indicated, the chief executive of NHS Improvement said yesterday that no other trust
“has shown the sheer scale and pace of the deterioration at King’s. It is not acceptable for individual organisations to run up such significant deficits when the majority of the sector is working extremely hard to hit their financial plans, and in many cases have made real progress.”
That is from the regulator responsible for putting the trust into special measures for now.
The “brutal reality”—to use the Minister’s words—is that the staff at King’s, which also serves my constituency, are doing all they can in impossible circumstances. If we are honest about this, we on both sides of the House have perpetuated the fiction for too long—over decades—that we can have Scandinavian levels of public services on American levels of taxation. That is why I ask him to heed the call of the hon. Member for Totnes (Dr Wollaston), and many others across the House, and set up a proper convention to look at what is a sustainable model, not just for King’s but for the whole NHS, so that our constituents can continue to get the services they deserve.
I share the hon. Gentleman’s support for the staff, and I have already paid tribute to the hard work and commitment that they are showing to their local population. His question regarding a royal commission is rather beyond the scope of this urgent question and rather above my paygrade.
We do have a problem with NHS managers; not only are there too many of them, but many lack clinical skills, which is probably why they make so many bizarre decisions. On Lord Kerslake’s watch, £715,000 was spent off payroll last year on an interim director, and £30,000 a month was spent on temporary managers. There is a problem with this scandalous waste of taxpayers’ money.
My hon. Friend takes a close interest in what is happening in London’s hospitals, where she regularly works shifts. From time to time, there is a need for some interim managers to fill vacancies and gaps, but she is absolutely right that we have taken significant action to limit the excessive amounts that some have been paid. The amounts have now been capped and are being driven out of the service, and the interim mangers are being encouraged to take up substantive positions.
I pay tribute to the staff at King’s, who have looked after so many of my constituents so well. Does the Minister agree that one thing we have to learn from this is that when a trust takes over a failing hospital, the challenges and difficulties can be much more than people have said, and the money given has not always been spent as it should have been? Does he also agree that just appointing a former head of the civil service to chair a trust does not necessary mean that they will have the attributes to do the job and that sometimes they are so busy doing other jobs that they might just take their eye off the ball?
In relation to the hon. Lady’s first point, I think that the experience has been variable; some outstanding trusts have taken on failing hospitals and managed successfully to turn them around, and others have found it more of a challenge. I accept that it is specific to the circumstances, and we are looking to learn from the various experiences to ensure that we encourage the right trusts to buddy up with those that are in trouble. In relation to her second point, I gently point out that Lord Kerslake has been providing advice to the NHS, and he has been spending a considerable part of his time providing advice to the Leader of the Opposition on a whole range of non-NHS-related topics.
Following on from the hon. Lady’s question, King’s College Hospital NHS Foundation Trust is indeed a significant organisation and it requires very firm leadership. I understand the chairman who has resigned from his position also held seven remunerated roles other than that chairmanship and four non-financial positions. Will the Minister assure the House that any future chairman will be looked at very closely to ensure they have the capacity to lead an organisation of this size successfully?
My right hon. Friend makes a very valid point. We need to ensure that chairmen who go into trusts that have challenges have the capacity to do that job. I will be looking to ensure that NHS Improvement challenges Ian Smith, if he is appointed, to check that he has sufficient capacity to undertake the role. My understanding is that he does.
NHS Improvement regularly reviews trusts in financial special measures. It does so through the usual channels to the ministerial team responsible for it. It will do so in this case, as it does in all other cases where financial special measures have been entered into.
The Minister quoted selectively from the chief executive of NHS Improvement, who also made it absolutely clear he did not think the NHS has enough money overall. In the real world, as opposed to the fantasy world inhabited by Conservative Ministers, Simon Stevens, the head of the NHS, has repeatedly told the Health Committee that the NHS cannot do what the Government are asking it to do with the current money. Is it not clear that there will be no £350 million a week extra for the NHS? There will be less, because of the impact of Brexit and the economic incompetence of this Conservative Government.