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Commons Chamber

Volume 636: debated on Tuesday 27 February 2018

House of Commons

Tuesday 27 February 2018

The House met at half-past Eleven o’clock


[Mr Speaker in the Chair]

Oral Answers to Questions


The Chancellor of the Exchequer was asked—

Local Authority Funding

1. What recent discussions he has had with the Secretary of State for Housing, Communities and Local Government on trends in the level of funding for local authorities since 2010. (904028)

2. What recent discussions he has had with the Secretary of State for Housing, Communities and Local Government on trends in the level of funding for local authorities since 2010. (904029)

It is right that more of our money that is spent locally is raised locally. In 2010, councils were 80% dependent on Government grants. By 2020, they will largely be funded by council tax and other local revenues.

Local councils have faced devastating cuts. The Institute for Fiscal Studies estimates that, between 2010 and 2020, councils will have had their direct funding cut by 79%. In Tower Hamlets, we have lost £138 million through budget cuts since 2010. With one of the Conservative party’s own councils going bust, will the Minister now finally commit to funding local authorities properly, so that they can provide vital services to their communities?

As I have pointed out, it is right that we rebalance council spending from central Government grants to locally raised taxes, to help to keep councils accountable. We have seen councils up and down the country finding innovative ways of working, such as sharing back-office services and doing things such as installing wi-fi and improving waste collection. We have also seen Labour councils wasting money. For example, Momentum-supported Birmingham City Council bin strikes have cost the taxpayer £40,000 a day, and Reading—

Order. Resume your seat, Minister. That is the end of it. You answer for Government policy. You do not waste the time of the House by launching into rants about the policies of other parties. I have made my point, and if the Chancellor is confused about it, he really is under-informed and I say to him: stick to your abacus, man.

My own council of Brighton and Hove has had to make £52 million-worth of cuts in three years, despite superb Labour leadership in the city. With one of the Minister’s own Tory councils going bust, will the Chancellor finally commit to properly funding local government in tomorrow’s local government finance settlement?

We have provided local councils with council tax flexibilities to enable them to fund spending in their areas. It is absolutely right that councils should not waste money and should find savings. The fact is that we went through an incredibly profligate period under Labour in which the Government were running record deficits, and we have succeeded in reducing the deficit by three quarters. I must also point out to the hon. Gentleman that councils have reserves of £23 billion. In fact, those reserves have increased by £8 billion since 2010.

In Cumbria, the Labour council leaders failed to reach a devolution settlement with the Government that would have brought in additional resource. Does the Minister agree, however, that this is not just about resource and that it is also about council structures, leadership and creating efficient organisations?

My hon. Friend is absolutely right. Lots of councils have done things better and more efficiently, and have led the way across government. We have given more powers to local Mayors, and we are giving Mayors across the country £4.8 billion of new investment over the next 30 years.

It is vital that we see more housing built across the country, and that is why in the Budget we committed to 300,000 homes a year being built over the next decade.

Will the Chief Secretary to the Treasury join me in paying tribute to Kent County Council, which has managed to make substantial savings and efficiencies since 2010, while continuing to provide excellent services?

My hon. Friend is absolutely right. We have seen the leadership of numerous Conservative councils across the country in finding new and efficient ways of doing things. That is what we need to do as a Government. We need to find better ways of doing things and more efficiency, rather than wasting money and crashing the economy, as happened under the previous Labour Government.

23. My county council of Derbyshire has seen its Government funding cut by over £200 million, and two thirds of its spending goes on adult social care. Does the Minister think that a postcode lottery of which counties can afford the most council tax should determine whether their elderly get looked after decently? (904050)

We have put additional funding into social care, and we have also allowed councils to raise the precept, but it is a very important principle that local councils are accountable to local voters for the money they spend. The situation we inherited in 2010, when 80% of the money came from the Government, meant we could have profligate local councils and local taxpayers would not have to foot the bill.

This week, having faced the same central Government cuts as everyone else, Conservative-controlled Kettering Borough Council, of which I am a member, can be expected to freeze its council tax for the eighth year in a row. Does it therefore appear that some councils are better at managing their affairs than others?

My hon. Friend is absolutely right. I note that council tax doubled under the previous Labour Government, and we are hearing talk from the Opposition that there might be another rise if they were to get into government again.

The issue of public sector pay is inextricably linked to the level of funding provided to both local authorities and other public bodies. Will the Chief Secretary commit to lifting the public sector pay cap across the board and to properly funding these pay increases?

We put an extra £2 billion of spending power into the hands of the Scottish Government at the last Budget, and we have also said that we want to be flexible over public sector pay to make sure we are retaining and recruiting the best possible staff.

First, if you will forgive me, Mr Speaker, as we came into the Chamber we heard the news of the death of Simeon Andrews, who co-ordinated a large number of all-party groups and trade union groups, and, if we can, I would like us to send our sympathies to his family on behalf of the House.

The ministerial responses we have heard demonstrate absolutely no understanding whatsoever of the crisis created by the cuts of the past eight years and their impact on local government. Local councils are now facing a funding gap of nearly £6 billion by 2020, and it is the most vulnerable in our society who are suffering. The number of children taken into care is at its highest level since 1985, and one in three councillors are warning that the cuts have left them with insufficient resources to support these children. The leader of the Chancellor’s own Surrey council said:

“The Government cannot stand idly by when Rome burns.”

Will the Chief Secretary commit today to use the opportunity of next month’s spring statement to address the funding crisis in our local councils?

First, the spring statement is not a fiscal event, and it is vital that we maintain the discipline that we have achieved over the past eight years and keep control of public spending, because that is what has led to the strong economy we are now seeing, with record levels of employment and an increasing number of new businesses starting up. The reality is that if Labour were to get into power, that legacy would be squandered.

Local government will see a 2.1% increase in cash terms between 2015 and 2019, and, as I have pointed out, they have also seen an increase in local council reserves of £8 billion—money available to spend on, and invest in, local services.

With the crisis in children’s services, to be frank this is not the time for political knockabout responses. I am not sure whether the Chief Secretary has witnessed a child being taken into care; I have, and it can scar that child for life. But do not listen to me; listen to the all-party inquiry into children’s social care, which warned that nine out of 10 councils are struggling to meet their legal duties to children. The president of the Association of Directors of Children’s Services has said:

“We cannot go on as we are”,

and it is reported that over half the councils in England are planning further cuts to children’s services.

Recent estimates of Government spending and income show that the Chancellor will have sufficient resources to protect our children from further cuts. So I appeal—once again—to the Chancellor to use the flexibility he has to use the spring statement to address the £2 billion funding gap in our children’s services, to protect our children.

It is a bit rich of the right hon. Gentleman to suggest that we should not bring politics into this when that is precisely what he is doing. We are making sure that local councils have the flexibility to raise council tax to fund these vital public services. Labour has to acknowledge that this is not just about the money we spend but the way we spend it. The reality is that if the entire focus is on the level of spending rather than what we are doing, we end up with the situation that occurred in 2010—vast increases in spending and services actually getting worse.

PFI Contracts and Carillion

3. Whether he has reviewed his Department’s procedures for authorising and monitoring private finance initiative contracts as a result of the liquidation of Carillion. (904030)

I am sure that the hon. Gentleman knows this, but just to put it in context, the vast majority of all current PFI projects—86%—were signed under the previous Labour Government. Since coming into office in 2010, this Government have reformed the approach, so that now PF2 contracts deliver better value for money for taxpayers. The performance of PFI contracts, including those where Carillion is involved, are monitored by the procuring authorities. New PF2 contracts will be subject to a rigorous value for money assessment. There are currently no PF2 projects in procurement.

I am concerned about the workers. Apparently, 90% of Carillion’s private sector contractors have suggested that they will continue to pay staff, but only in the interim period. What about the 10% who are not going to be paid, and what is going to happen to the staff after the interim period? Are the Government going to guarantee the employment status and pay of those individuals?

The hon. Gentleman may be slightly confusing PFI contracts with outsourcing contracts that do not involve capital structures. The resolution of Carillion continues. So far, there has been a very high rate of uptake by private clients of Carillion to continue the services that are being delivered, and we have high hopes of protecting the vast majority of the jobs involved.

We absolutely value transparency in the public-private partnerships that are delivered. They are an important part of the overall infrastructure. As I just explained to the House, there are currently no PF2 projects in procurement. That indicates that we have set the bar for value for money in public-private partnerships very high, and we will continue to do so.

Order. This is a rather extraordinary state of affairs. I hope that the hon. Member for Hyndburn (Graham P. Jones) is not indisposed, and if he is I am sorry, but otherwise there is absolutely no basis for his leaving the Chamber during the exchanges on his question. That is a rank discourtesy to the House—and a discourtesy to the Chancellor as well, for that matter. It must not happen.

The shadow Chancellor recently wrote to the Chancellor asking when he will produce revised value for money guidance, as highlighted by the National Audit Office; an updated list of PFIs, as existing data is nearly two years old; and details of any assessment the Treasury carried out on Carillion’s readiness to fulfil its PFI contracts. When will we get them?

I have not yet received a letter from the shadow Chancellor, but if he has written to me, I shall of course reply to him and answer his questions.

Road and Rail Investment

4. What recent assessment the Government have made of the effect of the national productivity investment fund on road and rail infrastructure in the north-west. (904031)

This Government have put raising our national productivity at the heart of our mission. From the national productivity investment fund, we have already announced over £50 million of investment in road and rail in the north-west, and this is in addition to the transforming cities allocations to Manchester of £243 million and to Liverpool of £135 million.

Does my hon. Friend agree that the £31 billion national productivity investment fund, targeted at transport, digital communications, research and development and housing, will boost the infrastructure of the UK economy?

The latest statistics show that we have had the best run of productivity growth since before the financial crisis, but we are certainly not complacent. The national productivity investment fund is improving passenger journeys, our roads and our broadband connections and delivering more homes, all of which are key to raising the wages and living standards of people in Southport and across the country.

The problem is that the national productivity investment fund is not doing anything to stop the disrepair on our roads and motorways. The Government are simply not putting in enough money for local councils and the national agency to make sure that repairs on motorways and local roads are brought up to standard. We now have a greater crisis than we have seen for some time.

I am afraid that I do not agree with the hon. Gentleman’s analysis. The Government have put a record amount of investment into our roads and rail. As the Chancellor announced in the autumn, there is further money for transport projects in the north. There is £13 billion in total to improve transport across the north of England.

This Government have done nothing to deliver local rail infrastructure in the north-west, which is vital for jobs and the economy. When are they going to invest in decent local rail services, including those used by my constituents from Southport to Manchester? If the Government will not do it, they should stand aside and let us get on with the job.

The Government have been investing more in railways across the country than any Government since Victorian times, including in the north of England. Across the country, the Government have invested £0.25 trillion in infrastructure projects since 2010, 4,500 of which have already been completed.

Major Infrastructure Investment

7. What plans the Government have to invest in major infrastructure during the 2017 Parliament. (904034)

8. What plans the Government have to invest in major infrastructure during the 2017 Parliament. (904035)

As my hon. Friend the Exchequer Secretary to the Treasury has just told the House, there has been more than £0.25 trillion of public and private investment in infrastructure since 2010. We continued to invest in infrastructure in the autumn Budget 2017 by expanding the national productivity investment fund, so that it will now provide £31 billion of additional investment, including more than doubling the housing infrastructure fund to £5 billion. The Institute for Fiscal Studies said after the Budget that our plans will see public investment increase to levels not sustained in 40 years.

Through the major road network, vehicle excise duty will be made available for investment in strategic roads outside the remit of Highways England. I understand that economic growth must be a priority, but how much will the pressure of future housing developments be considered in any of these future schemes? My constituency in York, for example, is surrounded by the northern ring road and we have a lot of housing coming forward.

My hon. Friend is right that the major road network will support the creation of new housing developments by improving access to future development sites and boosting suitable land capacity, so investment decisions for this funding will include consideration of how proposed schemes will unlock land for housing developments, helping to improve how transport is planned for new developments at the outset. The ring road to which he refers is, of course, part of the proposed major road network.

The Chancellor will know of the great eastern main line taskforce, which has made the economic and business case for rail infrastructure directly to the Treasury. He will also know that Greater Anglia commuters are forking out £3.7 billion to the Treasury under the current rail franchise. Will he ensure that we can get some of that money back out to invest in the much-needed infrastructure improvements for which our commuters are campaigning?

My right hon. Friend is a great champion of infrastructure in Essex, and I share her wish to create a more dependable railway with an increased focus on punctuality and reliability, which is why the Government are pursuing the biggest rail investment programme since Victorian times. Under the Greater Anglia franchise, there is a commitment to deliver more services and faster journey times, including two “Norwich in 90” trains each way a day from May 2019. The great eastern main line proposals are currently at an early stage of development, but we will carefully consider the case she has made for the passing loop.

Will the Chancellor update the House on the steps being taken to ensure the Government’s ambitious plans for housing are supported by local infrastructure investment, such as through the housing infrastructure fund?

My hon. Friend is right to observe that we cannot build the homes this country needs without infrastructure. Often, the push-back from local communities against the idea of accommodating greater numbers of homes is caused by the fear that infrastructure will not keep pace. The autumn Budget 2017 more than doubled the housing infrastructure fund, taking it to a total of £5 billion. On 1 February 2018, we announced the first £866 million of investment from that fund to support 133 projects, which will unlock infrastructure for up to 200,000 new homes.

It is now two years and two months since the Boxing day floods hit much of Yorkshire, including my constituency. Kirkstall in Leeds is no better protected from floods than it was on Boxing day 2015, and the Government still have not signed off money for the phase 2 Leeds flood alleviation scheme. When will that happen? The scheme is urgently needed to protect my constituents and local businesses from devastating floods such as those that we have already experienced.

My constituency has also been affected by flooding, and some of the responses are major engineering projects that take time to develop. The Department for Environment, Food and Rural Affairs and the Environment Agency have funding for flood relief projects, but those developments have to be prioritised and worked up into proper business cases. I will look at the specific case the hon. Lady raises and, if I may, I will write to her and place a copy of my letter in the Library of the House.

Some of the most important national infrastructure projects include the network of tidal lagoons for low-carbon energy. As the Treasury has, apparently, approved the project as good value for money, why is it allowing dinosaurs in the Department for Business, Energy and Industrial Strategy to block it?

I imagine that the right hon. Gentleman is referring to the Swansea Bay tidal lagoon project which, as he knows, is under consideration by the Government. An announcement will be made in due course.

Contrary to the Treasury’s own assessment, a report by the Institute for Public Policy Research North recently found that transport investment in London is two and a half times higher per capita than in the north. We know that in Norwich Britvic is shedding hundreds of jobs, citing poor transport as a key cause. That inequality hurts business and local authority revenue, so what actions will Ministers take to redress this unjust imbalance? Will they commit to working with the Mayors of Manchester and Liverpool on the convention for the north that was announced this morning?

I just do not recognise or agree with the hon. Gentleman’s figures. The Infrastructure and Projects Authority’s analysis shows that infrastructure investment per capita in the north is actually higher than in the south-east.

21. The Chancellor has spoken out in favour of rebalancing the economy via a fairer distribution of transport spending. Will he therefore consider Transport for the North’s strategic transport plan, which calls for a 50% increase in transport spending across the north of England? (904048)

The Government are committed to the northern powerhouse project and recognise that that has to be supported through infrastructure investment. We are looking at northern powerhouse infrastructure investment projects on a case-by-case basis, and we will continue to support the development of the northern powerhouse.

Leaving the EU

6. What recent assessment he has made of the effect on the economy of the UK leaving the single market and the customs union. (904033)

The Government are undertaking a wide-ranging set of analyses of the impact of our departure from the European Union. This is changing through time as we develop our approach and we move to a bold and comprehensive agreement with our EU partners.

The Chancellor knew in 2016 that the majority of people would prefer a soft Brexit to a hard Brexit. I am referring to remainers, plus people such as the Foreign Secretary, who said he favoured a single market and would vote for it. Now that the Chancellor knows that a hard Brexit will cost us £45 billion in lost tax receipts, will he at least acknowledge that people such as me on both sides of the Chamber who support our remaining in both the customs union and the single market do so in the name of prosperity and of upholding democracy?

The Government have made their position very clear: we are leaving the European Union, and that means we are leaving the customs union and the single market. However, we are determined to negotiate a deal under which our trade with the EU27 is as frictionless as possible and we are able, as a globally facing nation, to secure free trade agreements with other countries around the world.

Will the Minister confirm that the Conservative Government are and will continue to be the voice of British business, and that securing a strong economic future will be at the heart of the Brexit negotiations?

I thank my right hon. Friend very much indeed for that question. I can of course confirm that we remain entirely committed to the strength of our economy and to supporting businesses up and down the country, not least in our negotiations with the European Union. I have some responsibility for the customs part of the negotiations, and we are committed to making sure that goods and services move as frictionlessly as possible across the boundaries with the EU27 following our departure.

Mr Speaker,

“I believe that the best way forward is for Britain to renegotiate a new relationship with the European Union—one based on an economic partnership involving a customs union and a single market in goods and services.”

Those are not my words, but the words of the Secretary of State for International Trade and President of the Board of Trade on his website. What representations has the Minister had from the Secretary of State in support of our membership of the customs union and single market?

The Secretary of State for International Trade is fully committed to the options that we set out in last year’s White Papers on the customs union and on trade. We are taking forward legislation to make sure that our aspirations in that respect for our negotiations with the EU can be landed when the deals are concluded.

Yesterday, I met a delegation of business representatives from my constituency who are optimistic about our prospects when we leave the single market and customs union. They are examining the concept of a free port for Immingham. Will the Minister agree to meet them when they have further developed their thoughts so that we can try to overcome possible obstacles?

I—or, indeed, the Chief Secretary to the Treasury—would of course be happy to meet my hon. Friend and the business colleagues from his constituency. We are potentially interested in free ports and will keep the idea under review.

Many Cabinet members have made their views clear about the single market and customs union. The Chancellor has said that he would like to see no tariffs with Europe after we leave the EU and no hard border in Northern Ireland. His exact words, which were in a letter to the Treasury Committee, were that he wants a deal

“that facilitates the freest and most frictionless trade possible in goods between the UK and the EU, and allows us to forge new trade relationships with our partners in Europe and around the world.”

Will the Financial Secretary therefore welcome the speech that the Leader of the Opposition gave yesterday in which he proposed a new UK-EU customs union that would, to quote the Chancellor directly, facilitate

“the freest and most frictionless trade possible in goods between the UK and the EU”

and allow us to

“forge new trade relationships with our partners in Europe and around the world”?

I am here to speak about Government policy, as you have quite rightly indicated, Mr Speaker. However, if I may say so, Opposition Members’ zig-zagging in respect of their position on the customs union has been quite extraordinary. If I understand what is being suggested, it seems to me, at a first take, that the idea that we can be in the customs union yet go out and have a high level of control over deals and free trade arrangements with other countries just does not hang together.

The Welsh Economy

9. What recent assessment his Department has made of the effect of Government investment on the Welsh economy. (904036)

My hon. Friend will know that my right hon. Friend the Chancellor announced an additional £1.2 billion for Wales in the Budget. We maintain our position of ensuring that Welsh Government funding per head is some 15% or more above the rate in England. As a consequence of those and other measures, Wales is now one of the fastest growing of the nations and regions of the United Kingdom.

Does my right hon. Friend agree that leaving the UK single market would represent a far bigger risk to the Welsh economy than leaving the EU single market?

My hon. Friend is entirely right. It is a simple fact that some 80% of Welsh exports go to the other nations of the United Kingdom, compared with just 12% going into the European Union. Those figures speak for themselves.

Traditionally, Wales has lower wages than the rest of the economy. In the light of low productivity and growth forecasts, what are the Government doing to attract high-quality jobs to the Welsh economy?

As the House will know, we are doing a great deal for productivity throughout the country. We have agreed two city deals in Wales, with £500 million for Cardiff and £115.6 million for Swansea. Since 2010, employment in Wales is up by 7.3% and unemployment is down by 39%.

My question is this: what investment? The Government have broken their promise to electrify the main line between the two main cities in my country, they will not commit to the Swansea Bay tidal lagoon, and the Swansea Bay city deal is 90% Welsh public and private money. At the same time, the Government are subsidising the most expensive railway in the world—in England. When will the British Government stop taking Wales for a ride?

I am surprised to hear the hon. Gentleman level those accusations against the Government because, as I have explained, we set aside an additional £1.2 billion for Wales in the recent Budget. I have referred to the two city deals, and we are also backing the south Wales metro, as he will know. We are committed to agreeing further growth deals with north and south Wales.

EU Exit Analysis

10. What recent discussions he has had with the Secretary of State for Exiting the European Union on the Government’s preliminary EU exit analysis; and if he will make a statement. (904037)

The cross-Whitehall analysis referred to is provisional internal analysis—it is part of a broad, ongoing programme of analysis—and further work is in train. The analysis has been developed as a tool to inform Ministers on the European Union Exit and Trade Committee and its Sub-Committees about the choices that must be made as negotiations progress.

I thank the Chancellor for that answer. Does he agree with the former permanent secretary at the Department for International Trade that giving up the single market and the customs union is like giving up a three-course meal for a packet of crisps in the future? If not, can he identify what specific evidence his Department has seen to suggest that the benefits of future trade agreements will outweigh the damage of leaving the single market and the customs union to businesses and jobs across the country, particularly in the north-east?

The Government intend to maintain the greatest possible access for British businesses to European Union markets. The hon. Lady is right that we should approach this on the basis of evidence. We should look for evidence of the value of our trade flows with Europe and what jobs they generate in the UK, and we should look objectively at the opportunities that arise with third-country trade deals and with the likely profile of the new jobs, trade and opportunities that can be created, and then weigh those carefully.

Leaks from the Brexit analysis show that UK Government borrowing will rise dramatically under Brexit, with figures ranging from £45 billion to £120 billion in a worst-case scenario. Can the Chancellor reassure us that he will not cut vital public services to plug this gap?

As the hon. Lady knows, the analysis to which she refers is based on standardised, off-the-shelf trade models. The Government are seeking a bespoke deal with the European Union to deliver a deep economic partnership, which would have a completely different set of outcomes. That remains our objective.

Public Sector Pay and Equality

11. What equality impact assessments his Department has undertaken on the Government’s policy on the public sector pay cap. (904038)

It is for Departments to consider the equalities impact of their proposals on workforce strategy and pay. The important thing is that we reward public servants fairly for the work they do.

Well, public sector servants have certainly not been rewarded fairly, but let me turn to pay differentials in the private sector. Is the Chief Secretary as concerned as I am that many private sector firms are excluding partners’ income in their reporting obligations on the gender pay gap, on the basis that they are not employees? What will the Government do to close that loophole?

We have announced new policies on reporting the private sector pay gap. The pay gap has come down under this Government and we are now seeing a record number of women in work, and the reason is that we have taken the difficult economic decision to close the deficit and ensured that we have allowed the private sector to flourish.

17. With inflation at 3% and Government cuts to council tax and police budgets forcing up precepts, why should low-paid workers, who are predominantly women, have an increase of only 1% next year, after four years of 1% already? (904044)

First, I point out that those on the lowest pay have seen their real wages rise by 7% since 2015, which is the highest level for some time. Also, it is women who are more likely to be in work, with record levels of employment. We have also given additional flexibility to public services to ensure that they can recruit and retain.

Household Debt

The Government are taking a proactive approach to support borrowers, to aid people to manage their money well, and to help those in problem debt. We reformed the regulation, giving the Financial Conduct Authority considerable regulatory powers, and we are setting up a new single financial guidance body to make it easier for people to get help with money matters.

After seven wasted years, wages are still lower than they were in 2010. Self-employed people are paid less on average than they were a generation ago and 6 million people are earning less than the living wage. Does the Minister share my alarm that too many people have to worry about buying school uniforms, affording a family holiday, or even just paying their rent or mortgage?

The Government recognise that it is very important that we focus on the poorest people in our society. That is why we have increased the national living wage by 4.7%, which will mean a pay rise of £600 for those working full time. We have also increased the personal allowance, frozen fuel duty and increased childcare support to attend to the concerns that the hon. Gentleman has raised.

As part of the Treasury Committee’s inquiry into household finances, we are looking at the problems facing financially vulnerable households. Last week, my Committee colleague, the hon. Member for Bassetlaw (John Mann), and I visited the citizens advice bureau in Nottingham. Caseworkers there told us about the problems caused by banks and companies, but said that the harshest creditor of all is the Government. There is little forbearance for late council tax or welfare overpayments, and bailiffs are often the first port of call, rather than a last resort. Is the Minister concerned by this heavy-handedness? Does he agree that central and local government should lead by example in their treatment of the most financially vulnerable?

I acknowledge the vital work that my right hon. Friend and her Committee are undertaking in this important area. We will be implementing a breathing space as part of the work of the single financial guidance body. The Bill establishing that body is in Committee, as my right hon. Friend will know. I am absolutely determined that we will get this right and listen to best practice across the country. We committed in our manifesto to a six-week breathing space, and we will look carefully at the representations received from across the country.

22. Citizens Advice reports that there are universal credit claimants who are having more than 40% of their standard allowance taken from their monthly payment. There is a 40% cap on repayments to third parties, but that does not appear to cover repayments of advanced or budgeting loans. This is leaving people unable to make ends meet—for example, one person retained just £97. Will the Minister agree to meet his colleagues at the Department for Work and Pensions to ensure that people are not pushed into debt by the Government’s rules? (904049)

Of course I will meet with colleagues in government. I am meeting the relevant Minister as we seek to get this legislation right, and I would be happy to meet the hon. Gentleman as well.

Leaving the EU

13. What assessment his Department has made of the potential merits for the economy of the UK adopting an EEA Norway-style arrangement after the UK leaves the EU. (904040)

Membership of the European economic area would require free movement of people with the rest of the European Union, and the UK Government have been clear that the free movement of people cannot continue as it does now. We are seeking a bespoke, comprehensive and ambitious economic partnership in the mutual interests of the UK and the EU.

The Government’s own forecast suggests that a no-deal Brexit will cut GDP growth by 12% in the north-west of England. What steps is the Chancellor taking to minimise the impact of a no-deal, WTO-terms Brexit on my constituents in Eddisbury?

As I said in answer to a previous question, the figures to which my hon. Friend refers are based on standardised trade models, not the bespoke deal that we are seeking to achieve. She asks what steps I am taking to protect her constituents’ interests. I am supporting my colleagues in seeking to negotiate an ambitious economic partnership with the EU that delivers the maximum possible benefits for both the EU and the UK.

What assessment has the Chancellor made in particular of the potential benefits of EEA membership for the £91.8 billion contribution to the UK economy made by the creative industries that are so important for my constituents in Bristol West?

The hon. Lady is absolutely right that the creative industries are one of Britain’s great success stories. More broadly, our services sector is our strategic strength in many respects. As we negotiate our future relationship with the European Union, we have to ensure that we protect not only the market in goods, but the market in services, where Britain has such significant comparative advantage.

Technological Progress

14. What steps he is taking to ensure that the economic benefits of technological progress are shared throughout the UK. (904041)

By helping all places to access the benefits of technological progress and reach their full potential, we can drive growth at national level. Since autumn 2016, the Government have announced an additional £7 billion for science and innovation—an increase of about 20% to total Government R&D spending by 2021.

Does the Minister agree that digital technology enables further devolution away from London of high-tech industries? What are the Government doing to support that?

The Government are expanding Tech City’s reach across the UK, creating Tech Nation by investing £21 million over four years to help people grow digital businesses. That includes a large-scale CityVerve smart city demonstrator in Manchester, which demonstrates how the internet of things, technologies and services can improve local services in transport, energy, health and culture.

Newcastle has national centres of excellence in data, health and energy—key drivers of our future economy. On Saturday, I held a business summit with Sadiq Khan, the Mayor of London, at which start-ups identified attracting investment as a key barrier to their growth. What are the Government doing to attract investment to businesses in Newcastle? Does that include a regional business bank, as supported by Labour?

We certainly have a national bank to encourage investment in small businesses. We also have the £400 million digital infrastructure fund. As a Minister, I am doing all I can to ensure that we find the best conditions for investing in small and medium-sized enterprises across the country.

Regional Infrastructure Development

As the Institute for Fiscal Studies has confirmed, under our plan, public investment will reach levels not sustained since the late 1970s by the end of this Parliament. We want to see that investment across the United Kingdom. We are delivering £13 billion of transport investment in the north and have launched a £1.7 billion transport fund to transform our great cities.

Devolution in the Labour-controlled Liverpool city region and Greater Manchester is beginning to unlock opportunities for investment in infrastructure, research and development, and innovation in the north-west, allowing facilities such as the Daresbury campus in my constituency to develop and prosper. Does the Minister agree that if we are to be able to realise the full potential of our regions, devolution needs to extend to the many of my constituents and not the few?

I am delighted to hear the positive story that the hon. Gentleman has given to the devolution that we have created as a Government. In the past week I have met the Mayors of Liverpool and Greater Manchester. We are committed to working with anyone who shares our commitment to the economic growth and prosperity of the north of England.

The Scottish Economy

The Government are committed to driving up investment in Scotland; my right hon. Friend the Chancellor announced an additional £2 billion at the last Budget. We have already boosted city deals by £1 billion and have committed further to looking at city deals in Stirling, Tay Cities and the borderlands.

I am sure that my right hon. Friend will share my concern, and that of my constituents, at recent statistics showing that trend-based productivity in Scotland had declined by 3.2% in the year end to September 2017—well below the levels of the UK and its lowest level in eight years. Does he agree that instead of making Scotland the highest-tax part of the UK and increasing the tax burden on businesses, the Scottish Government should be encouraged to follow this Government’s lead—encouraging enterprise, boosting economic development and growing UK productivity to its highest levels in 10 years?

My hon. Friend is absolutely right to raise the critical issue of productivity, which is, of course, the responsibility of not just this Government but the Scottish Government. I totally agree with him about the tax matter that he raised. It is important that we keep taxes down. To the extent that that has been achieved in Scotland, it has been to a large degree because of the changes we have made to the personal allowance—a decision taken by this Government in this House.

Local Authority Funding

18. What recent discussions he has had with the Secretary of State for Housing, Communities and Local Government on trends in the level of funding for local authorities since 2010. (904045)

We have made sure that local councils have the full ability to serve local residents by giving them additional council tax flexibility.

I thank the Minister for that answer, but between 2010 and 2020, Peterborough City Council will have had its direct funding cut by 78.7%. Can she explain how my authority is expected to meet the rising children’s services and adult social care demands?

As laid out in the local government settlement, councils have been given the ability to increase council tax levels to pay for those services. It is vital that those taxes are raised locally, so that local councillors are accountable for the decisions they make.

Can my right hon. Friend confirm that the Government will move promptly to a new fair funding formula for local government to replace the untransparent and unfair system? Will she look closely at the Leicestershire model for doing that?

My hon. Friend makes a very good point. Local government funding has not been fair enough. That is why we are consulting on a fair formula at the moment, and I will look with interest at his representations.

Deficit Reduction

In 2010, we had a post-war record level of deficit at 9.9%, and we have reduced that to 2.3% as of last year. The Office for Budget Responsibility forecast in November is that the deficit will further decline to 1.1% of GDP by 2022-23.

Will the Minister give an estimate of the effect that our deficit reduction measures have had on relieving the tax burden for younger generations?

My hon. Friend raises a critical point about the importance of getting the debt down to make sure that future generations do not carry the burden of it. That is why we have reduced the deficit by three quarters and why we are going to hit our reduction in the level of debt as a percentage of GDP two years early, in 2020-21.

The hon. Member for Huddersfield (Mr Sheerman) is a really eager young pup, and at this early point in his parliamentary career, I think we ought to hear the fella.

Mr Speaker, you will know that I am not the most radical Member on the Labour Benches, but I want to tell the Minister that if the Government had been successfully reducing their budget, my constituents in Yorkshire could forgive her. The fact of the matter is that we have had the money for the electrification of the trans-Pennine railway stolen from us, and the Chancellor refuses to give it back. When will he make amends?

As the hon. Gentleman will know, whether he is young or a puppy or whatever he may be, we are awaiting the business case for the trans-Pennine project, and when we receive it, we will look at it most closely.

Gender Diversity

24. What recent assessment the Government have made of gender diversity in the financial services sector. (904052)

In summer 2015, the Government asked Jayne-Anne Gadhia, CEO of Virgin Money, to lead a review into gender diversity in the financial services sector. In response, the Treasury launched the women in finance charter, which asks firms to commit to four key actions as recommended in the review. So far, 162 firms have signed the charter, which covers more than 600,000 UK financial service employees.

I thank the Minister for that excellent answer. Following the Royal Mint’s appointment of its first female chief executive in its 1,100-year history, will the Minister join me in congratulating her on her new role?

Yes, I am delighted to congratulate Anne Jessopp, and I wish her all the best in her new role. If I may, Mr Speaker, I would also like to take this opportunity to applaud and congratulate my own constituent, Minette Batters, who was elected as the first woman president of the National Farmers Union. I wish the Secretary of State for Environment, Food and Rural Affairs all the best with that.

Topical Questions

My principal responsibility is to ensure economic stability and the continued prosperity of the British people, and I will do so by building on the plans set out in the autumn Budget. This Government are determined to meet the important challenges we face and to seize the opportunities ahead as we create an economy fit for the future. Our balanced approach to the public finances enables us to give households and businesses support in the near term and to invest in the future of this country, while also being fair to the next generation by reducing a national debt that remains far too large.

Reducing tourism VAT to 5% after we leave the European Union would create an extra 121,000 jobs and £4.6 billion in revenue to the Treasury over 10 years. It would be a great boost not only to our great cities, but to our great coastal towns, such as Exmouth, Sidmouth and Budleigh Salterton in my East Devon constituency. Will the Chancellor commit to looking again at this issue as we leave the EU?

My right hon. Friend is nothing if not persistent and consistent. I cannot remember how many times he has raised this issue. There have been numerous requests for new VAT reliefs since the referendum, some of which are currently not permitted under EU law. We have calculated that if we were to grant all the VAT relief requests that we have received, that would come to more than £38 billion a year. The Government have received representations on VAT and tourism, and we are looking again at the case for change.[Official Report, 1 March 2018, Vol. 636, c. 6MC.] We have issued a call for evidence on the impact of VAT and air passenger duty on tourism in Northern Ireland, and we will certainly keep this issue under careful review.

The Chief Secretary gave a speech last year calling for better value for money from the public finances and not spending money we do not have, and she has talked about not wasting money today, so how can she justify spending hundreds of millions of pounds on further tax giveaways worth £2,000 per child to the wealthiest families—those, for example, using private schools—via the tax-free childcare scheme? Is that not a waste of money and spending money we do not have?

I would point out to the hon. Gentleman that the voucher scheme invented by the previous Labour Government benefited only 600,000 families whereas our scheme is much broader—it benefits 1.5 million people—and the Labour Government’s scheme was open to private schools and private nurseries as well.

T3. Last week in the Chamber, we yet again heard an Opposition MP complain that they believed they should personally be paying far more tax. Will the Minister confirm the mechanism by which anybody can currently do exactly that voluntarily? (904057)

As a Minister at the Treasury, I am delighted if people voluntarily step forward to pay more tax than they are due. I am pleased to inform my hon. Friend that that is already possible by way of a gift to the Crown. I am looking at ways of raising awareness of that particular opportunity, and I would be happy to meet him to discuss such options. I would also point out to right hon. and hon. Members the very generous gift aid reliefs that the Treasury provides for those who wish to make direct payments to charities of their choice.

T2. Four in 10 of Enfield’s children are living below the poverty line, which is almost 34,000 children. The borough is the 11th most impoverished area for children in the UK, and my constituency is now among the top 20 constituencies in the country with the fastest growing levels of child poverty. Is the Chancellor pursuing any kind of joined-up policies with other relevant Departments to do what the Prime Minister said, and“make Britain a country that works not for a privileged few, but for every one of us”,including those 34,000 children? (904056)

The Government believe that work is one of the most important drivers of bringing people out of poverty, and we are rolling out universal credit as a consequence. There is evidence that that is more successful as a way of doing so than relying on legacy benefits. As the right hon. Lady will probably know, 200,000 fewer children are now in absolute poverty than was the case in 2010.

T5. What preparations has the Treasury been making for leaving the European Union, and will the Treasury be ready on day one to ensure frictionless borders when we leave the European Union—deal or no deal? (904059)

The Government are continuing with detailed preparations for all possible March 2019 scenarios, including ensuring that Departments have adequate resources to prepare effectively for EU exit. To date, the Treasury has allocated to Departments nearly £700 million for preparation activity, and we are currently in the process of allocating the 2018-19 funding from the additional £3 billion over two years that I announced at autumn Budget 2017.

T4. “The health and social care system has been pushed to its limits in recent weeks”—those are not my words, but those of my local hospital trust. Last month, it was forced to cancel about 325 operations and 640 outpatient appointments. That not only means that my constituents who are unwell or in pain are being made to wait longer for treatment but makes the trust’s already challenging financial situation even worse. When is the Chancellor going to give our health and social care system the sustainable funding it needs? (904058)

The hon. Lady should acknowledge that the NHS has been rated as the best healthcare system in the world. We recognise that there are extra demands on the health system and that is why we put in an extra £6.3 billion of funding at the Budget.

I am delighted to inform the House that considerable progress has been made in reducing the level of tax evasion, avoidance and non-compliance in the corporate sector. We have been at the forefront of initiatives launched with the OECD—the base erosion and profit shifting initiative, the profit diversion tax we brought in in 2015—and, as a consequence of clamping down in this area, we have brought in £53 billion from big business since 2010.

T7. Members have already raised the insufficient funding of local authorities by this Government. A recent campaign in Lewisham prevented local children’s and adolescents’ mental health services from being cut, but they are still facing a 5% loss in funding from national Government. When will the Government finally take this seriously and reverse the cuts to children’s mental health services? (904061)

We are putting additional funding and support into children’s mental health services and the Department for Education has recently announced additional support for children’s mental health issues in schools.

Will my right hon. Friend tell the House what assessment the Treasury has made either separately or jointly with the Department for Transport of how external initiatives on competitiveness and investment might help the rail sector and Network Rail in particular?

Strictly, this is an issue for my right hon. Friend the Transport Secretary, and he is looking at how to improve productivity in the railway and how to ensure that every pound we invest in the railway delivers the maximum possible benefit to railway users. He will make further announcements in due course.

T8. Could the Chancellor set out the benefits or otherwise of the arrangements the Government appear to have for a customs union between Camden, Islington and Westminster? (904062)

I am sure that when I go home and reflect on it, the deep meaning of that question will become clear to me. What I will say to the hon. Lady is that if we look at how goods and services flow freely between different parts of our own economy, and indeed between different parts of the United Kingdom, we see at once the huge benefit that it brings to have frictionless borders as we move our goods and services.

I am very much in favour of gift aid, but some large charities say that they receive no direct support from Government but do receive gift aid and the Exchequer will not publish those figures. Will the Chancellor reconsider this?

The Revenue does not disclose the sums that individual charities receive from gift aid due to its obligations to respect taxpayer confidentiality under the 2005 legislation. Of course, some large charities do so voluntarily. Cancer Research is one example, and receives £31 million in this way. I am sympathetic to my right hon. Friend’s argument and will take the matter forward.

Ryanair has announced the slashing of more than 20 Glasgow airport routes, a cut of more than 1 million passengers and the loss of up to 300 jobs. The high level of APD and the delay in introducing the air departure tax—caused by this Government’s not notifying the European Commission regarding the ongoing exemption for the highlands and islands—have been cited as a reason. Another is the Brexit uncertainty in the aviation sector. With more routes and jobs likely to go, what are the Chancellor and his colleagues doing to support the aviation sector during Brexit negotiations?

As the hon. Gentleman will know, the devolution of ADT has been delayed after consultations between ourselves and the Scottish Government. Both Governments are satisfied with the arrangements. As for Ryanair, I believe that part of the announcement was also that the company would be extending the number of routes out of Edinburgh airport.

If we want a sustainable rise in wages, we will need higher productivity. Does my right hon. Friend therefore welcome the recent improvement in the figures?

Yes. We have had two quarters of good productivity data, but we should recognise that the productivity challenge we face is long term. The Government have taken a range of measures to address it and we will watch the evolution of the data very carefully, but there is certainly absolutely no scope for any complacency about the scale of the challenge we face, and we are determined to rise to it.

Artificial intelligence brings huge economic opportunities, but to date big tech companies have seemed even more likely than traditional corporates to engage in aggressive tax avoidance and concentrate power in the hands of a narrow, homogenous group of people. What will the Treasury do to ensure that companies in this growing industry pay their own way fairly and take account of their wider corporate responsibility to society?

The hon. Lady will know that we made announcements in the Budget in respect of the taxation of digitally based businesses that operate from digital platforms and so create value as a consequence. We are consulting on the measures we may take. We said in our consultation document that it is possible we will look at revenue taxes as one particular approach. Our preference is a multilateral move with our partners in the European Union and the OECD, but we are prepared to go it alone if that proves necessary.

The services sector makes a huge tax contribution to the public purse. What confidence can the Chancellor give to my constituents who work in financial services that our new free trade agreement will cover services as well as goods?

We are clear that a future comprehensive trade partnership with the European Union must include goods as well as services. A deal can only be done if it is fair to both sides, and because of the shape of the UK economy it would be very difficult to see how any deal could be fair if it did not include services. We have heard it asserted that it is impossible for services to be part of a trade agreement. I do not believe that that is the case. Next week, I shall make a speech in which I will set out our view of how it is possible to include services within such a trade deal.

The Chancellor referred earlier to what he called the “continued prosperity” in the UK. Will he undertake to ensure that a simplification of the tax system is undertaken by looking at the level at which low paid full-time and part-time employees get the first £300 a week free of national insurance and income tax, to try to raise prosperity among all sections of the community?

We will continue to seek to simplify the tax system, although I have to say that my personal observation is that whenever there is a proposal to simplify, those who benefit from complexities quickly speak up. They are not always people on high incomes; they are often people on lower incomes. We shall continue to try to simplify the system in a way that is fair and appropriate for all.

While accepting that the Ministry of Defence is in need of serious reform as well as more money, will the Chancellor confirm that he has agreed with the Secretary of State for Defence that there will be no further reductions in capability while the modernising defence review takes place, and that the money required to do that, in the region of £2 billion, will be forthcoming?

As the House will know, I had the privilege to serve for nearly three years as Defence Secretary and I yield to no one in my admiration for the work of our armed forces. I also understand how complex and challenging managing the defence budget is: it is a multi-annual budget with many complex procurements. My right hon. Friend the Prime Minister and I are working very closely with our right hon. Friend the Defence Secretary as he carries out the modernisation review. We will ensure that defence has the funding it needs to continue to defend this country appropriately.

North Derbyshire clinical commissioning group finished last year £27 million in the red, and £16 million of cuts were demanded. In spite of closing hospital beds at a time when they are most needed, it will again end this year £27 million in the red. When will the Government give the NHS a sustainable settlement to enable it to provide proper services?

We have given the NHS a sustainable settlement. It received an additional £6.3 billion, but it is also important that we reform our healthcare services, that we put in place sustainable transformation plans, and that we are investing in capital and new technology and making sure that we use our fantastic frontline workers—nurses and doctors—in the best way possible.

As the Chancellor knows, investment in infrastructure is key to ensuring that we can build the thousands of homes that this country needs. Will the Chancellor agree to meet me, other Hertfordshire MPs and the leader of Hertfordshire County Council to discuss how we might be able to do that in Hertfordshire, where we need to deliver about 100,000 new homes?

Yes, I am always delighted to meet my hon. Friend and his colleagues. Hertfordshire is one of the high-pressure housing areas, where it is absolutely essential that we deliver additional housing if we are to improve affordability.

Cold weather payments were triggered in all postcodes in my constituency yesterday—information that I shared on social media—yet a constituent contacted me this morning to say that when she contacted the universal credit people, they said they knew nothing about it. Given the freezing weather and the fact that people will be nervous about turning on their heating if they do not know they can pay for it, will the Minister work with colleagues in the Department for Work and Pensions to resolve the situation as soon as possible?

I am grateful to the hon. Lady, and I will look into the point that she raised immediately. This is obviously an immediate issue in relation to the cold weather that we are having now. I will find out and let her know later.

Order. I am awfully sorry to disappoint remaining colleagues. I allowed some injury time because a wholly disproportionate amount of time was spent discussing the policies of parties other than the Government, but we must now move on.

Mental Health Act: CQC Report

(Urgent Question): Thank you very much for granting this urgent question, Mr Speaker. This morning, the Care Quality Commission published—

Order. I am immensely grateful to the hon. Lady, but she needs to say, “To ask the Minister for a statement, etc.” She will get her full go—her full bite at the cherry—when the Minister has delivered the initial statement. That is the way it works.

To ask the Secretary of State for Health and Social Care to make a statement on the Care Quality Commission’s report, “Monitoring the Mental Health Act in 2016/17”.

The Government welcome the CQC’s latest annual report, which it produces as part of its statutory duty to monitor how mental health providers exercise powers and discharge their duties when people are detained under the Mental Health Act 1983. We are committed to ensuring that the Act works better for patients and their families, and this is why we have commissioned an independent review led by Professor Sir Simon Wessely, which will make recommendations in autumn. We are also investing more in mental health than ever before, spending an estimated record £11.6bn this year.

We have seen that the number of detentions under the Act has been rising year on year: it rose by 2% last year and by 9% the year before that. We also know that black people are disproportionately affected. These were both driving reasons for the Prime Minister’s decision to call for a review of how the entire Act is operating. The Government have already acted when they saw that the Act was not working properly. Last year, we legislated to make it illegal to use police cells as places of safety for children under the Act, and to ensure that police officers consult health support staff before using their detention powers.

Sir Simon, his vice-chairs and the independent review’s team are consulting actively and widely with service users and professionals, and today are taking part in a major stakeholder event in Newcastle. Indeed, I welcome the fact that the CQC takes care in its report to state: “We have confidence that the independent review’s solutions-focused approach to identifying priorities, based on the feedback and experiences of people across the country, will offer a review of the MHA that has the confidence of patients and professionals.” The CQC is, of course, directly involved in that review.

The CQC’s report found examples of good practice, but we recognise that more needs to be done to ensure that people’s voices are heard and their rights respected. Where possible, we expect all patients to be involved in their care planning and that providers should consider how best to do this in the light of the CQC’s recommendations. In the spring, the review will provide an interim report identifying priorities for its work. It will then develop a final report containing detailed recommendations on its priorities. This final report should be delivered by autumn 2018.

There are problems with the Act, and we will address them, but we should remember that today no one gets sent to an asylum only to disappear within its walls. There are regular reviews, clear rights of appeal and checks to ensure that people are lawfully detained only to get the treatment they need. Our society is changing how it thinks about mental illness, however, and we want to ensure that people have as much liberty and autonomy as possible.

This scathing report finds that too many patients subject to the Mental Health Act continue to experience care that does not fully protect their rights or ensure their wellbeing. Some Members might have seen the harrowing episode of “Dispatches” last week, which showed scenes of a patient experiencing violent restraint at the Priory Group’s Dene Hospital. Today’s CQC report indicates that these experiences are not isolated. It shows no improvement in key areas of concern raised by the commission in previous years. It is totally unacceptable. In fact, some of the indicators are getting worse. Why is there still no evidence of patient involvement in 32% of care plans—up from 29% last year; of patients’ views being recorded in 31% of care plans—up from 26% last year; and of consideration of the least-restrictive care options in 17% of cases—up from 10% last year? This last, in particular, is a matter of serious concern. We know that the period following discharge from in-patient care is when most suicides happen. Why, then, in 24% of care plans was there no evidence that plans were made for discharging patients back home?

The report exposes the pressure on high secure hospital placements for women. One patient was in long-term segregation for over a year while waiting to access a bed. The Minister, to whom I listened closely, referred to the review by Sir Simon Wessely, but his review and report cannot provide answers to this patient or many hundreds more across the country today. Despite repeated Government promises of parity of esteem, we have seen yet another year of inaction. Does she accept that, in 2018 here in England, what is outlined in today’s CQC report is completely unacceptable, and will she tell us exactly what she is going to do this week to ensure that no patient in our country in a mental health unit is deprived unnecessarily of their human rights?

It is worth reminding the House why we introduced the CQC—to provide for transparent inquiry into the performance of our health services and so ensure they remain the best in the world. It is for precisely this reason—to make sure we do better—that we invite the CQC to do so so honestly and take any criticism arising from the transparent scrutiny that characterises this and all its reports. We recognise that we can always do better. The duty of candour in the NHS under this Government means that we will step up to the plate and respond to these challenges.

The hon. Lady describes the report as “scathing”. In fact, it highlights a positive direction of travel on access to advocates and promoting good physical health, and an improved direction of travel on care after discharge, so I do not accept the tenor with which she characterised the report. I would go further and quote the deputy chief executive of the CQC, who also highlighted the parallel review by Sir Simon Wessely. He says: “We have confidence that the independent review’s solutions-focused approach to identifying priorities, based on the feedback and experiences of people across the country, will offer a review of the MHA that has the confidence of patients and professionals.” The report also highlights that Sir Simon Wessely is already undertaking and identifying actions that can be taken outside new legislation, and the CQC is very much part of delivering that.

Far from being complacent, we recognise that we have a long way to go, which is one reason the Prime Minister has put mental health firmly at the top of our health agenda. The report identifies a positive direction of travel, but we will continue to turbo-charge it and deliver sustained improvements in mental health services.

One of the things that we are doing in prioritising mental health is dealing with exactly that issue. We are having discussions with every part of the health community. We recognise that all the professional organisations have a role in spreading best practice, but we need to do that as well, and the CQC report—and the fact that we are undertaking these reviews so transparently—will help us to do it.

Today’s report lays bare the problems that are at the heart of the Government’s short-sighted and incoherent approach to dealing with mental health issues. The CQC has found the system to be “under considerable pressure”, with no improvement in the areas of concern raised in previous reports.

Rather than taking a preventive approach to mental health treatment, the Government have made real-terms funding cuts which mean that more people are at risk of being detained and fewer detentions are being prevented. Crucially, those cuts are causing less restrictive alternatives for the community to be removed at the same time as the reductions in the number of beds for admissions. As the report tells us, the number of detentions under the Mental Health Act 1983 has risen by 36% since 2010, and between 2015 and 2016 it rose by more than 5,000. Will the Minister note that between 2000 and 2009 rates of detention fell, largely owing to investment in community services by the last Labour Government?

Recent research by the Royal College of Psychiatrists showed that mental health services have less money to spend on patient care in real terms than they did in 2012, and more than a quarter of clinical commissioning groups underspent their mental health budgets last year. The Government make many claims about the funds that they have pledged to mental health services—as the Minister has today—but it is clear that the money is not reaching the frontline. The CQC thinks that reform of mental health legislation on its own will not reduce the rate of detention, and reductions in mental health beds and community services are clearly contributing to the rise in the number of detentions. Is it not time to increase funding for mental health, and to ring-fence mental health budgets?

I repeat that we have increased mental health spending by £11.6 billion. The hon. Lady suggested that a quarter of CCGs are spending less than their allocations on mental health, but that is not the figure that I have. We believe that 85% of CCGs have increased their mental health expenditure in excess of their allocations, which does not chime with what she said about community services. It may give her some reassurance to know that from next year, NHS England will ensure that the mental health investment standard forms part of its planning guidance. [Interruption.] The hon. Lady says “Next year”, but, as I have said, 85% of CCGs are already meeting the standard, and those that are not are experiencing intervention from NHS England. We are satisfied that the 85%—and it will be 100% next year—are investing more in mental health services beyond their allocations.

I agree with the hon. Lady, and indeed with the CQC report, that the review of the Mental Health Act is not the entire answer. That is the reason for the CQC’s annual inspections, and we will act on its recommendations, but central to the work that Sir Simon Wessely is leading is identifying non-legislative action that we can take in order to make the system work better, and we are involved in many cross-Government initiatives that will enable us to do exactly that.

The report also concludes that the number of mental health wards without ready access to GPs has fallen from 25% in 2013-14 to just 7% now. Is that not welcome news, and another step in the right direction?

I thank my hon. Friend for that comment. He has highlighted both the reason why we tasked the CQC with conducting annual inspections and an instance in which, having been given a conclusion and a set of recommendations, we have delivered, and we will do the same in respect of this report.

The report makes clear the need for a major shift in focus that will place patients at the centre of their care. What is required is a human rights approach in which the least restrictive option is adhered to. Detention must be the last resort.

A key issue is that patients feel invisible in the present system. Will the Minister go to the frontline? Will she visit the hospitals, speak to the staff about resourcing, and speak to the patients and the carers who are in, and have been through, the system? Will she hold the focus groups that are so badly needed with patients and carers to ensure that the system is overhauled and their voices are heard?

The ethos that the hon. Lady has outlined is very much the one that is being proposed by Sir Simon Wessely, which is why he is organising round tables, but I assure her that I am visiting services at the frontline as well. At the core of the point that she has made is the issue of a rights-centred approach for mental health patients, and that too is at the centre of Sir Simon’s inquiry. Patients need to be empowered to ensure that they receive the right treatment. Central to that is the whole issue of consent, which is something that very much concerns me, and not just in the context of mental health. We may be able to take the lessons from Sir Simon Wessely’s review and apply them elsewhere in the NHS.

Does the Minister agree that a better laydown of mental health services, involving crisis houses and step-down facilities, might end the need for people to be admitted to acute mental health facilities in the first place, or else support them immediately after their discharge? Will she join me in encouraging the Somerset CCG to ensure that such facilities are available in that county as well?

My hon. Friend reached the nub of the issue in that final point. Commissioning is a matter for local commissioning groups. However, through the CQC report, the work that we are doing through the mental health investment standard and the scrutiny applied by NHS England, we are trying to ensure that there is a consistent application of good-quality services around the country. We find some centres of excellence and some areas in which the service is less patchy, but when it is less good it obviously leads to worse outcomes. We are determined to do our best to promote the best possible services throughout the country.

I welcome the Government’s outlawing of the use of police cells for those experiencing a mental health crisis, and I do not question the Minister’s commitment to improving the service, but the system is fragmented. There have been local authority cuts, including cuts in community services. The Health and Social Care Act 2012 leaves local commissioners to decide where the money goes, which has led to a confusing local picture and fragmentation. Do we not need to give people clear pathways out of hospital, and to ensure not only that the money goes to the right places, but that individuals know their rights and that local agencies know their responsibilities?

The hon. Gentleman’s point about people knowing their rights and providers and commissioners knowing their responsibilities is crucial to the whole issue, and I think it probably underlies the lack of parity of esteem hitherto. When it comes to the role of central Government, we want to continue to rely on local provision and local commissioning, but we also need to be clear about the standards of performance that people should be able to expect. We are being more transparent about where services are being delivered well and where they are being delivered less well, but I think the work that Sir Simon Wessely is doing will shine a light on exactly that, and will enable us to engage in a much more meaningful debate about what is appropriate.

Does the Minister agree that involving more patients in determining their own care packages and giving them more control over their own treatment is part of the treatment itself?

I totally agree. Feeling empowered and in control of one’s own care is quite a big part of the journey towards getting better. We are very concerned that we are still finding cases in which people are being detained under the Mental Health Act without being properly apprised of their rights under the Act, and without the support of advocates to represent them. Dealing with that is very much a priority as we drive improvement forward.

More than half of women with mental health problems have experienced violence or abuse, so may I ask the Minister what reforms will be made to the support available to women with mental health difficulties, particularly to reflect women’s experience of abuse in coercive or controlling relationships?

The hon. Lady raises an issue that is close to my heart. In my opening statement I highlighted the discrimination faced by black people in detention, but I could just as easily highlight the discrimination faced by women. As she says, if they become victims of domestic abuse or coercive relationships, they often face mental health challenges as a result, and they are more likely to be detained in those circumstances. I co-chair the women’s mental health taskforce with Katharine Sacks-Jones from Agenda, and towards the end of the year we are looking to bring forward concrete actions to tackle exactly this kind of discrimination and make mental health services more responsive for women.

As a doctor, I know how carefully doctors and other health professionals consider individuals before resorting to detention under the Mental Health Act. Does the increase in detentions under the Act reflect a general increase in mental health problems in the population, or can it be better explained by a greater proportion of people becoming so unwell that they need to be detained in order to support their care? What research is the Minister doing to determine which is the better explanation, and to ensure that we identify those people who are going to become severely ill in time to treat them?

Clearly, if we can determine the causes of the increase in mental health detention, that will become part of the toolkit that we use to tackle the issue. This is one of the things that we are asking Sir Simon Wessely to look at. There are anecdotal examples of why this might be happening, but the fact that we are seeing higher rates of detention among the black community and among women raises some interesting questions that will bear further examination. I recognise my hon. Friend’s point completely. Good medical practitioners will use detention under the Mental Health Act only as a last resort, and we must ensure that that good practice is spread as far as possible.

An acute mental health facility in my constituency has been forced to close because refurbishment would be too expensive, and patients are forced to travel a long way outside Bath. Is not a local facility much better suited to treating mental health problems than a facility that is many miles away, particularly because carers are a long way away as well?

Generally, I would say that local facilities were better, but there is also a tension between a local facility and a good facility. It is better that patients should get the best possible support rather than the closest possible support to them. That is a balancing act, and it is something that needs to be determined by local commissioners.

It is absolutely essential that every one of us should challenge the system to give more, but could we also talk up progress where it has been made? The Sussex partnership has had a difficult past, but it has gone from being rated as requiring improvement to being rated as good, and one of its categories has been rated as outstanding. Can we praise the staff who are doing things well?

We absolutely should do that. I often think that when we are challenging each other in this place about things that are poor, we end up talking our services down, but it remains the case that the NHS is the best health service in the world, and we should always celebrate that fact. Also, the fact that we are putting mental health services under such scrutiny is in itself driving an improvement in performance, because, as we all know, sunlight is the best disinfectant.

Further to that response, the CQC says that it has seen limited or no improvement in the key concerns that it has raised in previous years. The problems are long-standing and they have been raised by the quality regulator in previous reports to Parliament. Does the Minister not understand, when she tries to tell us that sunlight is the best disinfectant, that all we are seeing in our mental health services right now is clouds?

I would say to the hon. Lady that this report represents sunlight, not clouds. It is very transparent, and these are exactly the things that I will be holding myself and NHS England to deliver to address these points.

It is very worrying to hear the CQC’s judgment that there has been limited or no improvement, especially relating to the failure to involve patients in planning their care. The Government’s review of the Mental Health Act is therefore timely, and it rightly considers evidence from people who have experienced being sectioned. The report mentions significant variation in performance. Will my hon. Friend be looking into the performance of specific organisations? Can we have more transparency about the failures, down to specific organisation level? What steps are being taken to intervene earlier and to care for people better in order to avert crises and reduce the need for sectioning in the first place?

My hon. Friend will be aware that, in addition to this annual review of how the Act operates, the CQC is also involved in inspections at individual provider level. Those institutions that are not performing to the standards that we expect are under close scrutiny by the CQC. In fact, I have had exchanges on the Floor of the House about some of them. I repeat my point about the spirit in which we embrace the challenges offered in the report. We have asked the CQC to undertake this annual report precisely so that we can ensure that the Mental Health Act is operating properly, and I actually welcome its frankness. I do not run away from the criticisms in the report, because it highlights exactly where we need to take action.

If everything in the garden is lovely for mentally ill people, why am I constantly told by people in my constituency that another Government Department—namely, the Department for Work and Pensions—is getting loads of people who are mentally ill to be reassessed, having been out o