House of Commons
Monday 19 March 2018
The House met at half-past Two o’clock
[Mr Speaker in the Chair]
Oral Answers to Questions
The Secretary of State was asked—
Children in Need
We must help children in need to achieve their full potential. That is why we are already implementing vital social care reforms to improve children’s safety and stability. On Friday, we launched the children in need review. That will develop the evidence so that we can understand what makes a difference to those children’s educational outcomes and what works to improve those outcomes in practice.
I strongly welcome the review that was announced last week. Many of us have been pushing for that for a long time, and I am sure that it will make a difference to the nearly 400,000 children in need in our country. As the Minister goes about the review, will he commit to using the considerable data at his disposal to highlight those areas and children that buck the trend, so that we can learn from their example?
My hon. Friend has been a champion of children in need. The review is absolutely intended to establish best practice. It builds on work that we already do with our partners in practice local authorities, the expansion of which I announced last week.
Since 2010, the number of children on the child protection register is up 83%, while the number of children in care is at its highest since 1985. Does the Minister think that the cuts in children’s services since 2010 are the reason for that? If not, to what does he ascribe those terrible outcomes for the most vulnerable children in our society?
Local authorities have been increasing their investment in children’s services. I visited Hackney, Wigan and Doncaster, and my impression is that the real differentiator is leadership, which is why we are investing £2 million in the Local Government Association to look at leadership and the partners in practice programme.
Early intervention is critical to preventing children from ending up as in need, so why have the Government cut funding that supported the excellent Sure Start and Home-Start projects, which did so much excellent work with new parents in Great Grimsby?
Different local authorities do things differently. I visited Stafford, and Stafford and Newcastle have improved the outcomes for children in need by reaching out to those families, rather than by investing in bricks and mortar. There are different ways to deal with this, and local authorities do it best.
Research on the Department’s figures shows that children are 10 times more likely to be on a child protection plan if they live in a deprived area. Before the end of this Parliament, it is estimated that the figure for child poverty will reach 5 million and the funding gap in statutory services will reach £2 billion. The Minister said that strong leadership rather than extra funding is the key. Will he explain how strong leadership will end this crisis?
Local government spending for all services, including children’s services, is £200 billion. We do see leadership as a driver of better outcomes for those children. That is why we are making the investment, including the £15 million that we announced for eight more partners in practice, which help local authorities that are struggling. For example, Leeds is helping Kirklees.
National Funding Formula
The new national funding formula means that funding will finally be distributed based on the needs and characteristics of every school in the country. It is supported by an additional £1.3 billion, which means that we will maintain school and high-needs funding in real terms per pupil for the next two years.
Twenty-four of the 44 maintained schools in the Bishop Auckland constituency will lose in real terms, taking account of inflation. Many have high levels of deprivation and large free school meal entitlement. How can the Secretary of State justify that?
Of course, the formula rightly takes account of deprivation in the way that the hon. Lady mentions. If the funding formula were implemented in full in the Bishop Auckland constituency, based on the 2017-18 pupil data, funding would increase by £981,000 or 1.9%.
In every single school that I have visited in Bradford South since becoming an MP, the head has raised with me major concerns about funding. Will the Secretary of State confirm that, despite the £1.3 billion that his predecessor announced last July, school funding will still have fallen in real terms by 2020 for the first time in a generation?
No. On the same basis as I answered the hon. Member for Bishop Auckland (Helen Goodman), if the formula were implemented fully in the Bradford South constituency, it would mean an increase of 1.6% or £1.3 million. Across the system, per pupil real-terms funding is being maintained.
The cost of advertising for teachers and the cost of supply teachers, especially through agencies, are putting strain on school funding and budgets. What action are the Government taking to ensure that more money goes to the education frontline and less on bureaucracy?
My right hon. Friend makes a very good point about one of the cost pressures facing schools. We are working on seeing what we can do to help and developing a new framework to help to bring down recruitment costs, especially on the supply teachers she mentions.
Schools in my constituency welcome the principle of the national funding formula, which will see an increase in funding. Will my right hon. Friend meet me and representatives of primary and secondary schools to ensure it is implemented in the right way?
My hon. Friend is correct to say that the implementation of the national funding formula is a very important step forward. I always happy to meet my hon. Friend.
Taking into account the rising cost pressures on schools, whether on temporary and agency staff or on salaries, virtually every school in my constituency will face real-terms cuts to their funding by 2020. Is that not the truth of the Government’s policy, or does the Secretary of State for Education think he knows more about school budgets than headteachers?
Across the system over the next two years, the total core schools funding budget will be going up from just under £41 billion this year to £43.5 billion. Of course there have been cost pressures on schools. I do not deny that for a moment. It is one of the reasons why we are taking the steps I outlined a moment ago to try to help with those cost pressures, but across the system per pupil real-terms funding is being maintained.
We welcome the changes to the national funding formula and the additional money, but there is still a huge gap between the way schools are funded in West Sussex and in Greater London. Special schools are not included in the national funding formula, so an average 200-place school in West Sussex will receive something like £800,000 less than an equivalent school in Reading and £2 million less than one in London. When will the Secretary of State address this anomaly?
The intention of the national funding formula is not that every pupil throughout the country has exactly the same amount of money spent on them, because it is important that the formula recognises the difference in composition of pupil make-up. We were talking a moment ago about deprivation, but there are other measures of additional need that need to be reflected.
May I first start by congratulating Andria Zafirakou from north London, who won this year’s global teacher prize this weekend. I know the whole House will agree with her on the power of the arts to change young people’s lives.
In the Chancellor’s spring statement last week, he said:
“School budgets are increasing per pupil in real terms.”
He also said that
“every school will receive a cash increase.”—[Official Report, 13 March 2018; Vol. 637, c. 726-735.]
Does the Secretary of State agree with the Chancellor?
First, let me join the hon. Lady in congratulating Andria Zafirakou on her outstanding achievement. It is a particularly striking individual attainment, but it is also a reflection of the incredibly inspirational role that teachers everywhere play.
We have discussed funding at some length. The fact is that across the system the per pupil real-terms funding is being maintained. Over the next couple of years, local authorities will play a role in allocating that money to ensure the final result reflects local circumstances.
I am glad the Secretary of State accepts that point, because the UK Statistics Authority last week refuted both of those claims and he had to retract what he said at our last question time. Last week, he said:
“the mere repetition of a falsehood does not turn it into the truth.”—[Official Report, 13 March 2018; Vol. 637, c. 801.]
Will he now apologise for misleading the House and make clear the truth that there is no increase and that school budgets may face cuts of up to 1.5% per pupil?
Order. Before we proceed further, I must say to the shadow Secretary of State that any accusation of misleading the House must be accompanied by the word “inadvertent”. The hon. Lady cannot accuse a Minister or any Member of deliberately misleading the House, and I am sure she would not wish to do that.
No, Mr Speaker. Inadvertently misleading the House.
It is true that cash funding per pupil is increasing. It is also true that real-terms funding is increasing. But I could and should have been more precise that when we talk about real-terms per pupil funding, that is being maintained. The core schools budget over the next two years will rise from a little under £41 billion to £43.5 billion.
Since 2010, there are 1.9 million more children in good or outstanding schools and more disadvantaged children are going on to university. Our plans to make further progress include £72 million for 12 opportunity areas and £50 million on improving early language and literacy.
Youth unemployment in my constituency has fallen by 72% since 2010. If we are to build on that progress, will my right hon. Friend set out how we can support the schools that are underperforming, so that young people, wherever they live, have the best opportunity to make the most out of their lives?
My hon. Friend is right to highlight the dramatic falls in unemployment and youth unemployment. In his constituency, there have been over 7,000 apprenticeship starts since 2010. He is absolutely right that it is very important that all schools are able to share in the improvements in education outcomes, and it is very important that the support is there to do that.
Breakfast is the most important meal of the day, and I strongly welcome the £26 million to support breakfast clubs. Wiltshire is not a deprived county, but it has pockets of deprivation, with some of my schools having two thirds of pupils on pupil premium. Would the Minister please clarify to the House how exactly deprivation areas will be determined?
The definition of areas of deprivation will include the opportunity areas that I mentioned a little earlier, as well as other areas according to the IDACI—income deprivation affecting children index—methodology. I cannot say off the top of my head exactly what the implication of that is for Chippenham, but I will be very happy to stay in touch with my hon. Friend.
Literacy underpins social mobility, and since 2013, the National Literacy Trust has run a fantastic hub in Middlesbrough. Will the Minister join me in paying tribute to the hub’s work and in particular my constituent Allison Potter? It has contributed to narrowing the early years development gap in the schools that it works with from 24.8% in 2013 to just 8.5% last year.
Indeed. Improving literacy is vital to improving social mobility, and our plans for a centre of excellence and a national network of English hubs will help with that. I am happy, of course, to pay tribute to the fantastic work done by the National Literacy Trust in its Middlesbrough hub and to my hon. Friend’s constituent.
Three years ago, I launched the Liverpool to Oxbridge Collaborative to support the most academic students in schools in my constituency to give them the option of applying to either Oxford or Cambridge. What are the Government doing to support areas, particularly with high social and economic need such as Liverpool, to aim high for all their young people?
This goes to the heart of the Office for Fair Access and what the Office for Students will do, but it is also really important that universities—particularly selective universities—continue to redouble their efforts to make sure that they are reaching out directly, so that they are tapping into the full range of talents that are on offer throughout our country.
If the Secretary of State is serious about improving access to top universities for students from poorer backgrounds, why is he not doing more to enact the findings on the National Audit Office report on higher education, which urged the Government to do more to provide high-quality, independent careers advice to 13 and 14-year-olds?
The hon. Lady is entirely right to identify the importance of independent careers advice. That goes for applications to university, for subject choice and for considering technical and vocational—as well as academic—routes, and that is why we are putting so much focus on it.
The Secretary of State must understand that if we are to achieve social mobility, our schools have to be adequately funded. Because of funding cuts, Durham County Council is closing a school—the only school—in a disadvantaged village in my constituency. The young people there will feel undervalued, as will the community, so what will the Secretary of State do to ensure that that school stays open and that those children are given a real chance in life?
I totally acknowledge that it can be very unsettling and upsetting when a school closes like that. Of course, I am happy to discuss the particular case with her, but it remains the case that across the system we are holding the core schools budget constant in real per pupil terms.
Having worked with Magic Breakfast for over five years, I share the welcome from my hon. Friend the Member for Chippenham (Michelle Donelan) for today’s Magic Breakfast and school breakfast club funding. In addition to the money, will my right hon. Friend encourage partner schools to collaborate and share best practice to tackle social mobility challenges?
I pay tribute to my hon. Friend and constituency neighbour for all he has done on breakfast over an extended period, particularly with his Magic Breakfast connection, and I share his desire to make sure that best practice is shared across borders.
Scottish students from the most-deprived backgrounds are supported by a comprehensive financial package, including free tuition and bursaries, resulting in Scotland having the lowest university drop-out rate in the entire UK. Will the Secretary of State give serious consideration to mirroring the support given to Scottish students, including by abolishing the extortionate student fees, here in England?
The important things to note are that with our university financing system more young people, including from disadvantaged backgrounds, than ever are able to go to university, that universities are properly funded and that there is no cap on ambition.
Social mobility is improved when families have access to Sure Start and children’s centres, yet, in a damning report, the National Audit Office has revealed that the Government have cut spending on Sure Start by 50% in real terms since 2010, and we are still waiting for the long-overdue consultation on the future of children’s centres. Will the Secretary of State tell us whether he believes that these cuts are good for social mobility and on what date he will publish the consultation?
The hon. Lady is entirely correct in identifying the importance of early years for children’s development, social mobility and narrowing the gap, which is one reason we are putting so much more effort and money into early years and childcare, including through the extensions of eligibility for the two-year-old offer, which I think, bizarrely, she voted against last week.
We are using radio adverts, digital advertising, social media and telemarketing—the latest phase of marketing started at the end of January and will continue until the end of this month—and of course our national apprenticeship week, with its hundreds of events throughout the country, is also spreading the message. I should also point out that a legal duty on schools to allow in technical education providers was introduced in January.
My right hon. Friend knows that Newcastle-under-Lyme, Stafford, Shrewsbury and several other very good colleges that provide excellent apprenticeships have not been awarded funding under the non-levy apprenticeships scheme. She has worked hard to find a way through this, but can I ask her for an update to ensure that those colleges can continue to provide apprenticeships in vital areas such as construction and engineering; otherwise there will be a bit of an apprenticeships desert in those areas?
I know that my hon. Friend is a strong supporter of colleges in his area, but, as with any procurement, some bidders were unsuccessful. We have extended contracts for existing providers by three months to give employers and apprentices stability, and the main providers on the register of apprenticeship training providers can still deliver training directly to levy payers, to non-levy payers through subcontracting and to employers receiving transfers from April.
In 2009-10, there were 280,000 apprenticeships, and in 2016-17, there were 495,000, so we are moving in the right direction. What more can the Government do to lift the status of apprenticeships in schools, bearing in mind that most teachers come through a university route? Should Ofsted report on how schools are promoting apprenticeships when they do their examinations?
My right hon. Friend is absolutely right that status is crucial to increasing the value that people place on apprenticeships. Having employers involved in the design of the new standards right up to degree level and making sure there is that 20% off-the-job training and that they last for a minimum of 12 months are all about raising the status and currency of apprenticeship qualifications. I make no apology for making sure we increase the quality of apprenticeships. It is not just about numbers; it is about quality.
One of the key ways to promote apprenticeships is to maintain a broad curriculum in our schools. This was one of the key themes at the Association of School and College Leaders conference last week, where the CBI president said that children were missing out by being made to memorise facts and that the curriculum should prepare them for adult life. Does the Minister agree that the curriculum is narrowing to the detriment of children and our future economy?
There is no doubt that we have one of the best curriculums in the world. What is absolutely crucial to the success of any technical education programme —that includes apprenticeships—is a solid foundation at school. That can be used as a springboard into other careers, possibly via apprenticeships.
Knowledge of and access to apprenticeships relies on high-quality careers information, advice and guidance in schools. What are the Government doing to ensure that every young person is entitled to that information, advice and guidance, and that it stops being a rather dubious offer across the patch, as it is at present?
The hon. Gentleman is absolutely right about the importance of good careers guidance. I am sure he has read the careers strategy that we launched at the end of last year, which uses the Gatsby benchmarks as a spine. Schools have a legal duty to enable technical education providers to go into schools. The Careers & Enterprise Company is doing fantastic work all over the country, and Members of Parliament also have a role to play: they, too, can go into schools and point out the opportunities that exist.
Does my right hon. Friend agree that apprenticeships are vital to maintaining and enhancing our sovereign defence manufacturing capability, and are a key driver of social mobility, especially in constituencies like mine?
I completely agree with my hon. Friend. Apprenticeships represent a wonderful opportunity and are an important part of the mix.
Last month the Minister wrote to the chief executive of the Institute for Apprenticeships with a long list of requirements—I have it here—for the delivery of degree apprenticeships and technical skills at levels 6 and 7. The chief executive has said he told the Minister that the IFA could not take on responsibilities for technical skills unless adequate additional resources were allocated. Given that the institute is scheduled to take on those responsibilities next month, what resources and extra funds has the Minister allocated to the chief executive here and now?
I was with the chief executive of the IFA only about an hour ago. The institute is increasing its headcount substantially to ensure that it has the capacity to deal with the new T-levels that are coming on stream. This is a fantastic opportunity, and I look forward to working with those at the IFA. They know that they should tell me if they have any problems with resources, and we will then try to meet their needs.
Alternative Educational Provision
I, too, congratulate Andria Zafirako on winning the global teacher prize. I have met Andria. She is an inspirational teacher who is dedicated to her pupils, and she has a love of teaching and the profession.
On 16 March, we published a policy paper setting out our approach to the reform of alternative provision. We want to ensure that the right children are placed in AP, and that they receive a higher-quality education with better outcomes than is currently the case.
The Minister will know that, at its best, alternative provision can give young people an opportunity to get back on track, but that at its worst, in some cases, it is nothing more than childminding. He will also know that because of pressure on budgets, headteachers often take the cheapest option. Will he address that problem and ensure that schools have no incentive to send young people to alternative provision that is unsuitable and of no use?
The right hon. Gentleman is absolutely right. The GCSE outcomes of children in alternative provision are significantly worse than those of children outside it. Only 4.5% of pupils in AP achieve grade 4 or better in English and maths, compared with 65% of all other pupils. We have asked Ed Timpson to conduct an exclusions review to establish which groups of young people are being excluded from schools, focusing particularly on groups who are disproportionately excluded from mainstream education.
I refer Members to my entry in the Register of Members’ Financial Interests.
Some 56% of Bury schools that responded to my schools survey told me that they had been forced to cut special educational needs and disability provision because of school budget cuts. Does the Minister acknowledge that a bigger number does not mean more money per student, and will he commit himself to a real-terms per-pupil fair funding formula that encourages the inclusion of SEND pupils in mainstream schools?
We have increased high-needs funding from £5 billion in 2013-14 to £6 billion in 2018-19. It is up £130 million in 2017-18 compared with the previous year, and overall we are spending £1.3 billion more on school funding compared with under the 2015 spending review.
Knife Crime: Schools
I commend the hon. Lady for her work as chair of the all-party group on knife crime and for securing a debate on the subject last September. I assure her that the Department is committed to making schools as safe as we possibly can, and that is why we are working closely with the Home Office to reinforce the important message that it is totally unacceptable to bring knives into schools.
Knife-carrying in schools is up by 42% across the UK, yet in my constituency, and I expect across the country, at least three quarters of headteachers have had to cut staff, special needs provision and support such as mentoring, which are all crucial in preventing crime. Now that this epidemic has infiltrated our schools, will the Minister admit that school cuts are threatening our children’s safety?
The hon. Lady has heard from the Secretary of State regarding school finance, and all I would add is that the Department is working with the Home Office, and of course other stakeholders—the police, Ofsted, and the Health and Safety Executive—on updating our school security guidance to make clear the risks of carrying knives and to provide advice on dealing with this important issue. It is unacceptable to carry a knife in school.
Will my hon. Friend join me in welcoming the award from the Home Office of £765,000 for the new anti-knife crime community fund, some of which will be spent on delivering knife-crime awareness sessions in schools themselves?
I do welcome the Home Office’s commitment to this, and I hope the Mayor of London will do the same for the schools of the hon. Member for Croydon Central (Sarah Jones) in Croydon.
Youth violence is up and the number of mental health issues among young people is up, yet the number of qualified school nurses is down. The evidence shows that they can be part of how we address the root causes of youth violence. May we have qualified school nurses in every school as one step to tackle this issue?
The hon. Lady knows we are making further investment in mental health in schools to make sure that every school is able to deal with the issue in an appropriate way.
There are currently over 2,000 open sponsored academies and, as of 1 February, 92 schools subject to an academy order were in the process of being matched to a sponsor. That involves brokering a relationship between a suitable academy trust and maintained school, and includes addressing any land or contractual issues. A school not having a confirmed sponsor is generally not due to the lack of a sponsor, but because of the time it takes to address those issues.
The Minister might know that my interest in this matter stems from the number of years it took his Department to resolve the situation at Sedgehill School in Lewisham, which was not able to find a sponsor and instead has agreed a three-year school improvement partnership. If the Department is struggling so much to find sponsors for academies, why is this still a central plank of the Minister’s school turnaround strategy?
Because we are not, across the system as a whole, struggling to find new sponsors. We have 7,000 academies now, most of which are converter academies, and they themselves are becoming the sponsors of underperforming schools across the system. This system is working. Secondary sponsored academies made the strongest improvements in 2016, despite facing the biggest challenge, and compared with 2015, the average attainment 8 score for sponsored academies improved by almost three attainment points, compared with 1.3 attainment points for maintained schools. The academies programme is working and is raising standards right across the system.
Private Tuition and Safeguarding
It is ultimately the responsibility of parents to assure themselves about the suitability of any private tutor they might choose to employ before they engage them, for example by seeking and checking references, and asking to see a copy of any Disclosure and Barring Service certificate. It is a serious criminal offence to seek to work with children in a regulated activity after being barred from doing so.
One in four children currently receive tuition outside school, but private and self-employed tutors do not have to undergo criminal records checks, which puts those children at serious risk. What is the Minister doing about that? Will he meet me to discuss a serious case in my constituency and to talk about why the law must change?
I will certainly meet the hon. Lady to discuss the case about which she emailed us earlier today. I would be very happy to do that.
Schools can currently teach about LGBT issues and must comply with the Equality Act 2010. We have established a £3 million programme on homophobic, biphobic and transphobic bullying. We are also engaging with stakeholders to develop age-appropriate and inclusive relationships education, and relationships and sex education. The response to the call for evidence will be published shortly.
I thank the Minister for that answer. Following media reports of a school in London censoring textbooks that make reference to homosexuality, it is clear that more work is still needed. Will he agree to look at the recommendations of the Time for Inclusive Education campaign in Scotland to ensure that all young people receive an education that is fully LGBT-inclusive?
Yes, I would be very happy to look at that report. We are consulting on the content of relationships and sex education, and we will be publishing new guidance and regulations on that. We will consult on that. We have also introduced regulations to require schools to teach fundamental British values.
Student Retention: Higher Education
Our reforms will increase the chances of course completion. The introduction of a transparency duty, access and participation plans, and the teaching excellence and student outcomes framework will hold universities to account and help students to make informed choices about where to study and to get the best value for money.
The Higher Education Statistics Agency audit showed that 6.2% of first-time students in Scotland dropped out before their second year. That is not only the joint lowest figure on record, but the lowest in the UK. With Scotland leading the way, when will the Minister be coming north to Scotland for inspiration to enable him to think again about this Government’s failings on student retention?
Scotland is of course a beautiful country. Our reforms here have led to more disadvantaged people going to university than ever before. I agree with the hon. Gentleman that access should not just be defined as getting people into university. We want them to be successful there and to go on to achieve their aspirations. That is why, as part of our reforms, we are introducing access and participation agreements, which will be overseen by the new regulator, the Office for Students. These will ensure that universities are held to account for the success of disadvantaged students.
Can the Minister explain to parents under the age of 25 in my constituency who are unmarried but cohabit why their household is not eligible for an adult dependant’s grant while a similar household with a married couple would be?
It sounds as though the hon. Lady is referring to a very specific issue. I would be happy to take it up with her afterwards.
The Minister could always put a copy of his reply in the Library for the delectation of Members of the House, if he felt so inclined. I am sure that we would all be deeply grateful.
Does the Minister accept that if we want to retain students not just through their undergraduate degrees, but into postgraduate studies and long-term academic careers, they will need to have confidence about the benefits and provisions that will come with that? To that end, what discussions is he having with the University and College Union and Universities UK about resolving the pensions dispute?
The hon. Gentleman will be aware that an agreement was reached between the University and College Union and Universities UK last week. That agreement was brokered by the independent arbitrator, ACAS. I am disappointed that that agreement was rejected the next day, however, and I am urging both parties to get together to talk, because that is in the interests of students, especially at this vital time in their studies. The new regulator, the Office for Students, has wide-ranging powers to ensure that universities work to deliver for students. There is no mandate for strikes to disrupt exams.
Further Education Funding
As the hon. Gentleman is aware, we are undertaking a post-18 education and funding review—I am sure that he watched the Prime Minister announcing it up in Derby a few weeks ago. Alongside that, we are also looking at the efficiency and resilience of the further education sector. We need to ensure that existing and forecast funding, and regulatory structures, meet the cost of high-quality first-class provision.
Ministers make great play during these question sessions of the importance of social mobility, and there is no greater engine for social mobility in communities such as Stoke-on-Trent than properly funded and well-resourced further education. The City of Stoke-on-Trent Sixth Form College has seen its funding frozen in cash terms over the past few years, but rising costs and inflationary pressures mean that it has really seen a real-terms cut. What do the Government have against the colleges in my constituency?
We have provided £4,000 for every 16 to 19-year-old and an additional £600 for every pupil studying maths above the baseline. We have invested £500 million into T-levels and £20 million into preparation for T-levels. The work that we have done with FE colleges—
The hon. Gentleman shakes his head, but it is true.
I do not think that the Minister should take it personally. Head shaking in the House of Commons is not a novel phenomenon; I believe that it has been going on for some centuries.
As part of the review of FE funding, I am sure that the Minister will note the investment of more than £20 million at South Devon College in Paignton into two schemes to drive technical education. Does she agree that a key aspect of the review will be to look how institutes of technology, such as the one at South Devon College, are being taken forward?
My hon. Friend is right that institutes of technology will form an important part of the mix. I know that head shaking is common in the Chamber, but it should not distract us from the facts: we are putting in substantial amounts of money; we are undertaking a review of post-18 education; and FE is an important driver of social mobility.
Last week, Hull College Group announced the loss of 231 full-time equivalent jobs. It has told me that Government changes to funding for Jisc—an IT services company that provides free IT support to colleges—will set it back another £100,000, perhaps resulting in even more job losses. Will the Minister please reverse the decision, or at least provide some transitional funding so that FE colleges are not hit so hard?
The changes to which the hon. Lady refers were important; this is about fairness and equity. As I have pointed out, a lot of money is going into FE colleges, but we are looking at the efficiency and resilience of the FE sector to ensure that the forecast funding and structures meet the costs of high-quality, first-class provision.
Funding: 16 to 19-year-olds
As I have pointed out, we have protected the base rate of funding for 16 to 19-year-olds until 2020, and we will invest £500 million extra a year into T-levels. I have asked my officials to assess how far the current funding system meets the costs of high-quality provision in the further education sector and will update the House shortly.
Last week, Warrington and Vale Royal College announced its intention to close the campus at Northwich in my constituency—with 56 job losses and 300 students displaced—citing severe financial pressures and the Government’s area-based review. Will the Secretary of State or the Minister agree to meet with me, the staff and some of the students affected, and hopefully reverse the decision?
I am happy to meet the hon. Gentleman. I should point out, because not everybody understands it, that colleges are independent bodies. I understand that Warrington and Vale Royal College recently took a view that the Hartford campus in Northwich was unviable and that provision should be transferred to create a more efficient offer at other sites, with travel support provided to learners. The issue arose from difficulties in recruiting learners, not budget cuts.
Hopwood Hall College in Rochdale has achieved some remarkable results. Towns such as Rochdale are more dependent on further education and less dependent on the university system. Will the Government recognise that the differential in funding in further education holds back young people from the most-deprived areas, who need skills training more than anybody else?
One reason why we are undertaking a post-18 review of education and funding is to make sure that all people, no matter where they come from or what part of the country they live in, have access to high-quality education, be that in HE or FE.
Andria Zafirakou has already been mentioned a couple of times today, and I know the whole House will want to congratulate her on having been awarded the global teacher prize this weekend, beating 30,000 entries from 173 countries.
This Government are committed to supporting all teachers to make sure that children get a world-class education. This month, I announced that we will develop a plan on workload, professional development, flexible working and entry routes into teaching. On Friday we launched the children in need review, to develop the evidence on what makes a difference to children’s educational outcomes so that more children can get a better start in life. I am also today announcing an investment of up to £26 million to boost breakfast clubs in more than 1,700 schools in some of the most disadvantaged areas, complementing our expansion of eligibility for free school meals.
In the light of the recent racist incident in one of our schools in Bath, does the Minister believe the safeguarding policies, procedures and processes in our schools are strong enough, and that the Ofsted inspection regime is adequate in respect of safeguarding?
I was truly shocked to read of the incident to which the hon. Lady refers. Such incidents, and racism in general, must of course have no place in our schools or our country. Schools have to have a policy setting out measures to encourage good behaviour, including the prevention of bullying, and where there are serious concerns, Ofsted has powers to inspect any school without notice.
This is not a situation we wanted to be in, but we are obliged to undertake these procurement exercises. There were 1,046 bids, for £1.1 billion. Some 700 of those bids were successful and got a total of some £490 million. We have put in transitional arrangements for existing providers that were unsuccessful, giving employers and apprentices stability. As I pointed out to my hon. Friend the Member for Stafford (Jeremy Lefroy) earlier, those providers can still access apprenticeship funding by delivering training directly to levy payers, to non-levy payers through subcontracting and to employers receiving transfers from April.
The pensions dispute ground universities to a halt last week. The Secretary of State will be aware that there is a proposal on the table to underwrite the universities superannuation scheme. Although this matter is reserved, the Scottish Government have said that they will give consideration to the proposals from the University and College Union. Given the talk of further disruption, will he commit to doing the same?
As I mentioned in my earlier answer, the agreement on the table was brokered between both parties by ACAS. The dispute is between the universities, which are autonomous organisations, and the lecturers. This is a private pension scheme and one of the country’s largest, with nearly 400,000 members and more than £61 billion in assets. The cost to the taxpayer of underwriting such a scheme could be significant, and any further Government involvement in supporting the USS would need to be considered very carefully.
I share my hon. Friend’s concerns; it is a terrible case, and tragically not the first of its type. I will write to ask the chair of the new national child safeguarding review panel to look at the places where these appalling crimes have happened, such as Rotherham, Oxfordshire and, indeed, Telford, and to report on whether lessons have been learned and practices improved right across the system.
Last week, the Secretary of State was forced to extend the childcare voucher scheme by six months in order to survive the vote on it that we called. I tried to get some answers last week, but the Secretary of State has given us no clarity on what will happen next. Will he come back to the House with an oral statement and give us a meaningful vote before the scheme ends?
The move to tax-free childcare is of course a Treasury and Her Majesty’s Revenue and Customs policy rather than a Department for Education one, but we made it clear in last week’s debate that there would be an extra six months to look into transitional considerations.
We have increased high needs funding, including by an additional £130 million this year. Local authorities are responsible for their high needs budgets. I have not heard wide concerns about funding not being used to support special educational needs, but I am of course happy to meet my right hon. Friend to discuss the matter further.
The hon. Member for Hitchin and Harpenden (Bim Afolami) has just been elevated by the Minister to membership of the Privy Council. That makes him the first of his intake, and he must be deeply grateful.
The Government have not been sitting on the sidelines. We have made sure that we have been in touch with all the interested parties. Our prime concern is obviously for the students, whose education is at stake. It is up to the universities, as the employers, to negotiate with the lecturers as the employees. A deal brokered by ACAS is on the table. At the heart of the dispute is the valuation of the pension scheme, and part of the deal is an independent valuation of the pension scheme in the months ahead, which is why I am disappointed that the deal was turned down the next day. I urge all the parties to get together and to keep negotiating to resolve the matter.
I welcome the news that up to £80 million will be invested in helping small businesses to recruit apprentices. How and when will small businesses be able to apply for that funding?
It is very good news. As my right hon. Friend will be aware, the Government will already pay 90% of training costs for small businesses. We will announce in due course more details on how that money will be distributed.
There is no actual or inadvertent misleading of the House. It is a fact that across the system the core skills funding budget will go up from £41 billion this year to £43.5 billion in a couple of years’ time. Beyond that, the national funding formula seeks to correct some of the long-standing imbalances in the system. I was pleased to visit Stoke recently and meet some of the outstanding headteachers who operate in the hon. Gentleman’s area. Funding has been tight for schools and there have been cost pressures over the past couple of years, and we stand behind headteachers and do everything we can to support them.
The University of Cambridge’s announcement that it will now offer apprenticeships has put a quality stamp of approval on that educational route. Does my right hon. Friend agree that it is important that children from all around the country, including from schools in Redditch, are encouraged to apply? Does she agree that the “Opening Doors” programme, which brings children from Ipsley middle school in Redditch to local business MSP Ltd, is key to the raising of aspirations?
I congratulate my hon. Friend on what is going on in her local area; it sounds excellent. A degree apprenticeship is a wonderful way for students to earn while they learn, get a degree, come out at the end of it with several years’ work experience and, probably, be way ahead of their contemporaries who did an undergraduate degree.
We have funded a considerable number of defibrillators in schools, and we are working with the British Heart Foundation to provide facilities for schools to teach first aid and lifesaving skills in schools.
Pay rises for teachers in schools in my constituency would be most welcome, but there is a concern that those rises will have to be met from the increase in funding that was delivered to schools in the summer. Are there plans, like there are with the NHS, to find a budget outside the existing school funding formula for those pay rises?
The teachers’ pay review body is deliberating at the moment. We have already given our evidence, as, of course, have the consultees. I point out that, since the spending review, an additional £1.3 billion has been found for school budgets.
Can the Minister tell us how many children with special educational needs or a disability will not have an education and healthcare plan by the Government’s deadline of 1 April?
Our aim is that every child will have a plan in time. Those who do not can be assured that their support will be maintained, but most local authorities are on target to deliver the health and care plans.
Over the weekend, I raised the issue of the passporting of childcare payments by Northamptonshire County Council to local providers. I am very pleased that a solution has been found. I am grateful to Ministers for their support and their interest in this issue, but will they join me in thanking the staff of children’s services at Northamptonshire County Council for listening to the concerns and solving this matter so rapidly?
I certainly join my hon. Friend in his thanks, and I would actually like to meet him to look at what other support we can provide. I also commend the director of children’s services at Northamptonshire County Council for doing an excellent job in very difficult circumstances.
Based on Government statistics, 63 schools in my borough will lose funding of £300,000 per annum between 2015 and 2020. Can the Minister tell me what happened to the Prime Minister’s promise to maintain pupil funding?
No school in the country will lose funding under the new national funding formula. The minimum that schools will receive is an extra 0.5% increase, and that will be for schools that have been receiving more than that funding formula would produce. Therefore, no school will lose funding. As my right hon. Friend the Secretary of State has said, there have been cost pressures in recent years, but we are helping schools to deal with them through school efficiency advisers and buying schemes to enable them to marshal their resources as efficiently as possible.
Recent figures from the Department show that, last year, 4,350 children were adopted in England. That is a near 20% decline from the peak in 2015. Why are adoptions in decline?
The Government are working with the sector via the Adoption Leadership Board to address the issue of adopter numbers early on, to ensure that there remain enough approved adopters for children who are waiting.
Parents whose children use the Fields children’s centre in Cambridge are seeing hours at the nursery cut, the baby room closed, and parents being encouraged to ask their employers to amend their working hours to fit the reduced hours. How does the Minister expect parents and families to cope when he is making their lives so much more difficult?
The experience around the country does not reflect the hon. Gentleman’s view. The opposite is happening. Parents are getting places, especially under the 30 hours a week of free childcare for three and four-year-olds. Almost 300,000 children are now taking up those places, as we announced last week.
Last week I had the honour of chairing in Westminster the second annual Stafford schools debating competition. The standard was excellent, and I pay tribute to Councillor Carolyn Trowbridge and Sam Phillips for their work in organising the competition. What is the Department doing to encourage public speaking and debate in schools across the country?
I join my hon. Friend in commending his constituents who organised this great event. It is true that public speaking, debating and other such activities are really important for developing a rounded young person—the character development that we all want to see. Members of Parliament can also play an important role in this, and many run their own events.
Yes, and I look forward to visiting the constituency of the hon. Member for Stafford (Jeremy Lefroy)—I think in his company—very soon. I imagine that his constituents will roll out the red carpet for him; he will be pleased to know that they certainly will not be expected to do so for me.
Did the abolition of the education maintenance allowance contribute to or hinder social mobility?
With the alternative funding that was put in place, it was possible for sixth-form colleges to do other things to ensure that they were attracting the full range of students. More disadvantaged youngsters are going on to university than ever before.
Last week I opened the extension to the Knowle West children’s centre. The previous week the local further education college, City of Bristol College, hosted my apprenticeships fair. Both sectors are telling me that they are desperately short of funding due to cuts. What assessment do the Government make of children’s outcomes as a result of the current funding cuts?
Local authorities are responsible for how they deliver support to families, through children’s centres as well as other support. Many authorities are focusing on getting support directly to families rather than investing in bricks and mortar.
The pupil premium is an important source of funding to level the playing field and improve social mobility. I have asked a number of questions about ensuring that all those who are eligible receive the pupil premium, and about improving its scope. Does the Minister now agree that it is time that we had a review of the pupil premium?
My hon. Friend is entirely correct that the introduction of the pupil premium made an important structural change in how we do these things, by ensuring that the additional resourcing follows the pupils who need it in so that we can narrow the gap. It is also right that we keep these things periodically under review, as she suggests.
The hon. Member for St Helens South and Whiston (Ms Rimmer) is belatedly bobbing, but I am not psychic. It helps to bob all along, if you want to be called.
Thank you, Mr Speaker.
What plans do the Government have to support the 1.4 million children and young people affected by the decision to discontinue the specialist contract for speech, language and communication needs?
We are currently in negotiations with the Communication Trust. We are looking at whole-workforce training to ensure that we deliver better quality outcomes for children with speech and other disabilities.
I welcome the news of the £26 million investment in breakfast clubs. How will my right hon. Friend ensure that the most disadvantaged children benefit from that, particularly in coastal communities?
We are using the IDACI—income deprivation affecting children index—methodology, as I mentioned earlier to my hon. Friend the Member for Chippenham (Michelle Donelan), to ensure that this investment goes specifically to the most disadvantaged areas, where it can make the most difference.
I will call the two Members who have not been heard in this session—first, Diana Johnson.
Thank you, Mr Speaker.
When does the Minister intend to announce the date for issuing the criteria for the pilots to address holiday hunger that were announced just a few weeks ago? Hull is champing at the bit to make its application.
We have done some excellent work on this, and an announcement is imminent.
Michelle Gay, headteacher of Osborne Primary School, was in tears when she told ITV just how tough it is to be one of the 361 schools in Birmingham suffering real-term cuts while trying to give kids in one of the poorest and most deprived constituencies in Britain the best possible start in life. Headteachers have asked to meet the Secretary of State personally so that they can bring home to him just how tough it is becoming. Will the Secretary of State be generous and agree to meet them?
As I said earlier, real-terms per-pupil funding in the core schools budget is being maintained across the system, but two things are overlaid on that. First, there is the application of the national funding formula to correct historical imbalances; and secondly, of course, local authorities play a part in reflecting local circumstances. I do acknowledge that with the cost pressures that there have been, things have been tight in school budgets. I will be happy to meet the hon. Gentleman and his constituents.
(Urgent Question): To ask the Chancellor of the Exchequer if he will make a statement on the Government’s action to address dirty money being laundered in the UK.
I thank the shadow Chancellor for giving the Government the opportunity to come here today to say what they have been doing on dirty money and money laundering in the United Kingdom. It is a long list, Mr Speaker, so I ask you to have a bit of patience and I will try to be as quick as possible in reading it.
We have made it harder for crooks to launder money through property, jewellery and betting. We have reversed the burden of proof so that people we think have links to organised crime have to prove where their assets come from. If they cannot prove it, we will seize the asset and dispose of it, or keep it to distribute it to countries where it may have been stolen. We have, for the first time, through the Magnitsky amendment made it possible to confiscate assets from people guilty of gross human rights abuse. We will complete that with an amendment to the Sanctions and Anti-Money Laundering Bill currently going through Parliament. I pay tribute to my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell) and the right hon. Member for Barking (Dame Margaret Hodge), who actually led the campaign on the Magnitsky amendment, not Labour Front Benchers.
We have made it easier to seize criminals’ money from bank accounts. We have introduced new powers to be able to freeze terrorists’ assets, and we did so on the very day that the provision came into force. We have made it a criminal offence to fail to prevent tax evasion, both at home and overseas. We are currently exploring the potential of widening other areas where failure to prevent may apply in economic crime.
We have brought a number of prosecutions under the Bribery Act 2010 of those involved in bribery, and we have had the first conviction of a company for failing to prevent bribery. [Interruption.]
Order. There is quite a lot of noise. I know that the Minister is keen to rattle through, and we are deeply obliged to him for doing so, but I just say very gently to him that there is no prohibition on breathing during the delivery of an answer to an urgent question.
We introduced deferred prosecution agreements to ensure that we maximise incentives for companies to face up to fraud and corruption. We are setting up the National Economic Crime Centre within the National Crime Agency. We have brought together the many strands of economic crime under one Minister—namely myself. We have bolstered the Serious Fraud Office by ensuring access to blockbuster funding so as to ensure that big business and overseas oligarchs cannot use their wealth to obstruct justice. The previous Prime Minister, David Cameron, initiated an international anti-corruption summit. In response to the Panama papers, we established a joint financial analysis centre within the NCA. We have established one of the world’s first public registers of beneficial ownership of companies. We have helped to establish in all overseas territories and Crown dependencies a register of beneficial ownership, with mutual and, in some cases, live-time access to law enforcement. We have committed to establishing a public register of overseas owners of property in the United Kingdom.
This Government have taken real steps to tackle criminal finance in this country. Whoever the crooks are, wherever they are from, and no matter what their nationality, we will pursue them and their cash.
I thank the Minister for his response.
Twelve months ago, I raised in an urgent question the issue of the Russian laundromat, as it was called, laundering £20 billion of criminal funds through the City of London. Despite all that the Minister has said, the National Crime Agency estimates that £90 billion from the rest of the world is still laundered through the City each year, while the United Nations estimates that $100 billion has been lost in the British overseas territories. Despite all the actions that he set out, there is still a major problem. At the weekend, the Government said that they would enter into “detailed discussions” on further reform proposals. I therefore have a number of questions to ask the Minister.
Let me be clear: we welcome the Government’s new willingness to incorporate Labour’s proposals for Magnitsky measures to be included in the Sanctions and Anti-Money Laundering Bill, but we would welcome, in the spirit of co-operation, full and thorough discussion of the final drafting of the new clauses and amendments. We all agree that there is a need for complete openness and transparency in our financial system if we are going to be effective in tackling money laundering. Back in 2015, the Government initially promised, following two consultations, a date for a register of owners of UK property based overseas. After repeated delays, why are we now told that a register will not be published until 2021? There is minimal checking of the UK’s own register of company ownership. Indeed, it was possible for a journalist to set up a company called Crooked Crook Crook Ltd. Have the Government undertaken an assessment of the number of fraudulently registered companies in the UK? If not, when will they do so?
In the recent Sanctions and Anti-Money Laundering Bill Committee, the Government justified their lack of action on foreign trust or company service providers by saying that they were lower risk than the UK’s own trust or company service providers. In the light of the most recent evidence of money laundering via overseas TCSPs, will the Government revisit that assessment?
Why have the Government not included trusts in the register of beneficial ownership, as Labour has so long asked for? Given the concerns about corrupt funds being laundered through properties in the UK, will they now consider including Labour’s proposal for an offshore company property levy in their reforms? Will they finally join Labour in accepting the need for public, transparent registers for overseas territories and Crown dependencies?
Finally, 634,000 suspicious activity reports have been filed since October 2015. What will the Government now do to ensure that the enforcement agencies are fully resourced to tackle this scourge on our society?
This is interesting, because we have done a lot of work on criminal finance. I have stood at this Dispatch Box on numerous occasions, and the Government have taken many pieces of legislation through the House. The Treasury has also stepped up to the plate. Indeed, it has its own levy: where a property is bought by an overseas company or a UK company, it attracts an extra high level of stamp duty of 15%, which of course matches the levy that the right hon. Gentleman is talking about.
We have committed to a public register of overseas ownership of property, and we will introduce the Bill in 2018. We have to make sure that this is right. [Interruption.] The Opposition shout, but the reality is that we are taking many steps to deal with criminal finance, and there are only so many months in the year. We should not forget that, as we saw over the weekend, this is really a distraction by the Labour party from its woeful response last week to our national security.
This is an attempt by the shadow Chancellor to say, “Nothing to see here. Look over there—it’s all about oligarchs.” Before coming to the Chamber, I looked up in Hansard when the shadow Chancellor last mentioned oligarchs. The last time he mentioned them was in 2016, in a debate on the schools White Paper, in which he talked about the tax rate for cleaners. He should raise that with Hansard if he would like to.
The reality is that this Government and the coalition Government have been absolutely determined to deal with the threat posed by dirty money going through the City of London and being harboured here in a number of properties. The best example of how we have done the work in this House and how this is all last-minute Labour is that one of the complaints they made over the weekend was that unexplained wealth orders were not used by this Government. An unexplained wealth order was used in under two weeks of coming into force on 31 January. It was served against an overseas oligarch, on £22 million of property. That was action within a fortnight, contrary to the Labour party’s idea that no unexplained wealth orders have been issued. The other measure introduced by that Bill was used before midnight on the first day. I suggest that Labour does its homework, tries to put right its disaster of last week and stops trying to distract from the reality about the Russian threat.
Order. A very large number of hon. and right hon. Members are seeking to catch my eye, but I remind the House that there are two further urgent questions to follow, meaning that there is a premium now upon brevity, which, as always, will be brilliantly exemplified by Sir Desmond Swayne.
How much have we secured since the implementation of the Proceeds of Crime Act 2002?
My right hon. Friend asks a pertinent question. It is well over £1 billion—it is about £1.6 billion, I think, and it has increased in the last few years. We have been determined, through the use of confiscation orders and the provisions we used to improve the Act through the Criminal Finances Act 2017, to start increasing the seizure and freezing of assets, to make sure that criminals lose their ill-gotten money.
I welcome what the Minister said about the Magnitsky amendment, but can he confirm that it will be genuinely tough and will allow the authorities to seize money very quickly? When does he intend to take action on Scottish limited partnerships, which are one of the main routes for filtering dirty money into the UK and laundering it? In addition, when will he finally fix the loopholes at Companies House, where to all intents and purposes absolutely no due diligence is done when a new company is registered?
The hon. Gentleman is doing exactly what Scottish National party Members did during the passage of the Criminal Finance Act, which was to work with us and make some sound suggestions about how to tackle criminal finance. We listened to them—for example, we lowered the thresholds of unexplained wealth orders to fit with some of the concerns in Scotland. I have taken up the issue of Scottish limited partnerships—the Department for Business, Energy and Industrial Strategy is driving forward that work—because, like the hon. Gentleman, I realise that it has to be tackled.
When it comes to a Magnitsky Act, I give the hon. Gentleman the absolute assurance that we will deal with anyone convicted of gross human rights abuses, whether through sanctions, seizing their assets if they are obtained criminally or controlling their movements through visa bans and any other measures. The intention of this Government is to make life incredibly hard for people who have committed human rights abuses and to prevent them and their families from enjoying the benefits they currently enjoy should they come to Europe to spend the money.
I congratulate the Government on moving towards supporting the Magnitsky amendment. There are three elements to such an amendment: first, asset seizures; secondly, visa bans; and thirdly and very importantly, a public list of named individuals. A public list makes it difficult for those named to access finance, and encourages others not to get on the list. Will the Minister set out his position on a public list?
My hon. Friend makes a very sound suggestion about a public list. As hon. Members will know, the Government are consulting within the various Departments on how to make sure that the amendment we put forward actually makes a difference. That is why we opposed the Labour proposal in Committee: it was not because we disagreed with having a Magnitsky amendment, but because we wanted to make sure we had one that worked. [Interruption.] Labour Front Benchers are saying, “Point of principle”. Would they rather we accepted a flawed amendment that did not do the job, or would they like this Government to deliver action, as we have done with unexplained wealth orders, by getting the law right in the end?
I acknowledge that the Government have taken some steps, but I put it to the Minister that they have not taken enough. Others have raised the issues of property and of our tax havens, and I want to raise another issue with the Minister, which is the tier 1 investor visas—the golden visas. Anybody who wants one of those visas needs to demonstrate that they have £2 million they wish to invest in the UK, and we know that Russia is one of the two top countries taking advantage of tier 1 investor visas. What steps will the Minister take to enable us to understand where the £2 million-plus comes from, so that we can be assured it is not dirty money and that these are not unsavoury individuals?
Not for the first time, the right hon. Lady makes a very good suggestion. When it comes to dealing with foreign oligarchs and serious organised criminals from overseas, we are clear that this is as much about the free movement they enjoy as about the actual assets they are moving around and harbouring. We already have the powers in our visa regime to take action, and as she quite rightly says, we will be looking at that tier to make sure we do better due diligence, if we need to, on where the money comes from.
In all of this we must be clear that the difference between us and, for example, Russia is that we believe in the rule of law. Under the Equality Act 2010, we cannot talk about Russians in a blanket fashion; we have to recognise that there are certainly legitimate Russians and other people from overseas who come here to invest in this country, and I am sure the shadow Chancellor would not like us to break the Equality Act. We have to make sure that we act on the basis of evidence. We will do so, and where we find wrongdoing, people will be refused a visa.
Will the Minister confirm that the UK was the first country in the G20 to introduce a register of company beneficial ownership, and that we rank as one of the most efficient countries in terms of tax collection in many international league tables?
Yes. The tax gap is the lowest it has ever been, and much lower than it was under Labour. We have recovered a record amount of tax that should have been gathered—£160 billion over the past few years—and that has been a major contribution to the coffers. On the register of beneficial ownership, this country has led the way. David Cameron set out his ambition for the Government, and it is still the ambition of this Government. We have led the way, and now Montserrat, one of the overseas territories, also has a public register of beneficial ownership. The key is that the territories all have a register, and it is our ambition for them to be public, but in the meantime our leadership is starting to make a difference around the world.
My right hon. Friend the Member for Barking (Dame Margaret Hodge) asked an extremely important question, to which she did not get an answer from the Minister. I wonder if we can try again. What changes are the Government planning to make to the due diligence for the golden visa, which establishes that someone must have £2 million they are investing in the UK before they get access to free movement here? What changes are the Government going to make to check that that money is clean? He did not answer—answer now.
The hon. Lady will know that there are numerous registers for people’s money. CIFAS and a range of other organisations record people who have been involved in fraud and other criminal actions. There are also the Government registers, such as the police national computer. We will continue with diligence based on applications for visas. [Interruption.] Members need to come to the House and say, “This person was allowed in based on their £2 million and we have prima facie evidence that they should not have been.” We will base it on evidence. Where we find evidence that someone got the money through the wrong means, they will not be allowed a visa to come into this country.
Will my right hon. Friend update the House on how the swift application of unexplained wealth orders under this Government is making a significant difference in tackling money laundering and terrorist finance, thereby demonstrating how seriously the Government take the issue?
When an unexplained wealth order is made, the National Crime Agency or the Serious Fraud Office, for example, goes to the court to apply for it. A judge can give a period of time for the person to respond to the charge that the law enforcement agencies have made. If they cannot, we move to seizure. Usually, at the same time as an unexplained wealth order is applied for, we also apply for a freezing order to make sure that the person does not move the money or the property when the order is made. We believe that it is a very important tool and there are many more in the pipeline. We used it within 14 days of it coming into law on 31 January.
Does the Minister share the concern voiced by some that online platforms are being used for the purposes of money laundering? Will he ensure that the regulatory bodies and agencies concerned in the UK have all the necessary resources and the agility to counter that problem?
The right hon. Gentleman makes some important points. The first is about the development of new technologies, such as platforms and cryptocurrencies, which all present a challenge for law enforcement agencies around the world. The Governor of the Bank of England recently commented on that, and it is something that we will all have to think through. There is no easy answer on some of them.
On the issue of regulation and supervision, we are obviously working closely with the Financial Conduct Authority and Her Majesty’s Revenue and Customs—the tax authorities—to make sure that we spot when people move money without paying tax. It is also important to gather evidence from that movement. Of course, this country is bound by a number of directives on money laundering that we follow. We are currently subject to the Financial Action Task Force inspections on how we deal with money laundering. That leads to an independent international report that judges and ranks us. All hon. Members are welcome to comment on that and we will be held to account.
When the Home Affairs Committee looked at this issue in 2016, witnesses pointed to a lot of hot Russian money in the London property market, yet out of 1.2 million property transactions in that year, only 355 suspicious activity reports were raised. There were problems with the fragmented regulatory landscape. Will my right hon. Friend tell us what progress has been made by the NCA-led joint money laundering intelligence taskforce in coming up with a more joined-up approach to this issue?
My hon. Friend asks a very good question. In fact, one of the first things I did when I became the Minister for Security and Economic Crime was to use the Home Affairs Committee report to hold the Department to account and ensure that we put right some of the things that clearly had not happened in the area of asset recovery. On SARs reform, it is worrying that SARs predominantly come from the banks—about 83% of them—and only the rest come from the facilitators. I have been determined, as has the director general of the NCA, to start focusing on the facilitators. It is the lawyers, accountants and people who sell things like boxes at football stadiums and Bentleys around the world who need to do more to report suspicious activity. When they do, we will stop it.
May I take the Minister back to the question that the hon. Member for Huntingdon (Mr Djanogly) put to him? Have the Government compiled a list of politically exposed people from Russia, such as First Deputy Prime Minister Igor Shuvalov, who could be the subject of unexplained wealth orders? If they have such a list, will it be published and will the Minister give us a timetable for its implementation?
The right hon. Gentleman knows that I will not come to the House and publish the names of individuals who may or may not be the subject of an investigation or of operations against them because it could threaten our ability to have an effect on them. Needless to say, we are determined to ensure that we use intelligence-led policing to find money and deal with those individuals, whether they are from here or abroad.
These crimes can be horrendously complex. Can we be confident that the SFO, the NCA and other bodies have the skills and resources to investigate them properly?
Yes. As I said at the beginning, one of the challenges of taking on people with deep pockets or large corporations is that they have no qualms about setting off to the Supreme Court or the High Court to challenge us. We are keen to ensure that we support the NCA with unexplained wealth orders, because some of the people to whom they serve them have a brass neck and are happy to challenge us. That is why we put in blockbuster funding for the SFO, which means that when there is a case of significant scale, it can access funding directly from the Treasury to ensure that money is not a barrier to taking on some of those very bad people.
The Minister has just talked about blockbuster funding for the crime enforcement agencies, but how many criminal cases have been opened in the UK in response to the Magnitsky case?
That is a matter for the NCA—[Hon. Members: “Zero!”] No, no. The NCA has appeared before many parliamentary Committees and been asked those questions. They are a matter for operational partners. It is not for Ministers to come to the House to talk about potential ongoing operations, which could expose our police officers or our methods to the risk of people getting away with it.
Does the Minister agree that the UK is one of the most transparent jurisdictions in the world for financial services, which are a key contributor to our economy, and that suggesting that money laundering is somehow rife in the UK risks talking Britain down?
It is interesting that no Opposition Member mentioned the fact that, only in the last few weeks, the UK went from 10th to eighth on Transparency International’s register of least corrupt places in the world. That speaks volumes.
It is three years since I raised the case of Dmitry Firtash, a Putin associate, who was arrested in Vienna on corruption charges at the FBI’s instigation. The Ministry of Defence sold him Brompton Road tube station for an undisclosed price. I know that the Minister cannot comment, but notwithstanding the fact that Dmitry Firtash donated £200,000 to the Tory party, may I suggest that an unexplained wealth order be put out for him?
I said earlier that the difference between us and Russia is that Ministers here do not sit around directing who to pick on and who not to pick on. Our operational partners are independent of Government. That is the difference. We will ensure that any case is evidence led and that we follow the rule of law. That is how we make a difference and send a message internationally.
What steps is the Minister taking to bolster international co-operation on tackling this?
The best example I can give is that, after the Panama papers were published, we set up the joint financial analysis centre with the NCA and HMRC to ensure that we went through them and worked internationally to deal with some of those involved, collect some tax and potentially prosecute people. That happened through joint working at home, bringing together our partners, and internationally.
Over the past eight years, the brave campaign of Bill Browder, who has done more than anyone to expose this criminality, presented the UK Government on five separate occasions with dossiers of evidence of Russian money laundering in London as a direct result of the crime that Sergei Magnitsky uncovered. Twelve other countries have begun criminal proceedings, based on the evidence that Mr Browder gave them. Not a single case has begun in the UK. Why does the Minister think that is?
I met Mr Browder and he presented me with his portfolio of evidence. I have raised it a number of times with the NCA, the Serious Fraud Office and the police. I would be delighted to meet the right hon. Gentleman to discuss this specific issue directly. It is up to the operational partners to make a decision. [Interruption.] He may say it is about evidence, but we have make sure that it is evidence up to a level that can produce prosecution in court. I am happy to explore that further with him. My door is open.
Will the Minister update the House on what is being done to confiscate the assets of those guilty of gross human rights violations?
If there are criminal assets, we now have the powers to do that. We will bring forward any cases where we have collected the evidence and prepared a case. As I said, the Criminal Finances Act became law on 31 January, so we now have those powers. On sanctions, the sanctions Bill is currently transiting the House. We will bring forward our amendment in due course on Report. I hope we will work across the House to ensure the amendment is acceptable.
The Minister will be aware of the allegations in the press that the First Deputy Prime Minister of Russia owns two flats in Whitehall through a company worth over £11 million. Does the Minister believe that he has the powers to know whether that is true? If he does not, when will those powers be in place?
I do not think I have to tell the Chair of the Home Affairs Committee about standing at the Dispatch Box and commenting on an individual case. She will know that, through our intelligence agencies, the police and a variety of partner organisations, we have the ability to find out information about people and gather evidence, if it is there, to make sure we make a case either to serve some of the new measures I have mentioned in the Criminal Finances Act or take action under the Proceeds of Crime Act 2002 and other measures that have been around for some time. We will not hesitate to do that if we feel that it is the right thing to do. It does not matter who that person is—whether they are a politically exposed person, or whether they are linked to friendly countries or adversaries—we will take action to take that money. I do not want that reputation for London and I know the right hon. Lady does not.
On a recent trip to Washington with the Public Accounts Committee, it was notable that officials from both the International Monetary Fund and the US Treasury were very positive about Britain’s leadership in tackling money laundering. Will the Minister further explain the work the Government are doing on a multilateral and international basis to ensure that this issue is dealt with not just in Britain but across the world?
Through the NCA, the Government have invested in a network of overseas officers working around the world to make sure they have the best liaison and best access to other investigators, such as the FBI. I recently visited officers in Singapore whose job on a day-to-day basis is to put together international cases, either for this country or for their host country, to make sure we go after these people no matter where they are all around the world.
Can the Minister rule out any dirty Russian money having made its way to any politically exposed person in the UK, political party or think-tank? Will he say whether the database of PEPs is being run routinely against known sources of dirty Russian money?
The hon. Gentleman will know that the Electoral Commission is the arbiter of policing political funding. I know what he is trying to get at. We are confident that all our donations are in accordance with the law, as set out for UK citizens. I would rather be taking money under that premise than from Max Mosley.
I welcome the overall tone of the Minister’s responses. Will he reassure me that the Government will continue to focus on the evidence base to deal with those who have committed human rights breaches and what may be corruption, rather than just apply a broad brush that might actually target those whose only offence is holding a passport of a nation whose leader wants to become a dictator?
It is very important that we tackle transnational criminals using a much more co-ordinated Government response. The Prime Minister has brought together many strands of economic crime and put them under one Department and one Minister, so that we can co-ordinate them better. It is incredibly important that we recognise that we have to use the rule of law. It has to be evidence-based, so that we can take action and remind those countries that this is about an international world order and the international rule of law and so that we can show that this country is a beacon around the world, not some client state that targets people willy-nilly.
Further to the questions asked by my hon. Friend the Member for Leicester West (Liz Kendall) and my right hon. Friend the Member for Exeter (Mr Bradshaw), proceeds of the crime that Sergei Magnitsky exposed and was killed over were laundered into a number of countries, in particular, by accounts from Dmitry Klyuev. No fewer than 12 other countries have, at the very least, initiated investigations into money laundered from this crime, because they believe that the necessary level of evidence has been met. Why has not one of the five UK authorities presented with this complaint over the past eight years, at the very least, done the same?
If the hon. Lady has an issue about whether or not the National Crime Agency or the police have taken action, it is a matter for her to raise with the National Crime Agency. I have raised the same issues with the National Crime Agency—I have asked it, but it is operationally independent. What I can say is that by using the Proceeds of Crime Act, since 2010, we have recovered £1.4 billion of assets from crime. That is making a difference; it is taking the money out of the pockets of criminals, both internationally and domestically.
Does my right hon. Friend agree that although the Labour party talks about money laundering and tax evasion, the record clearly shows that it is this Government who are leading the world in dealing with these issues?
If we look at the tax gap, that absolutely shows that this Government have the lowest tax gap. It is far, far better than it was under the Labour party.
Order. I note that Members only on the Opposition Benches—a large number of them—are standing. True to form, I am sure that they will want to behave in a comradely fashion towards one another, recognising that a long question by one will stop another. I am sure that they are not the sort of people who would want that to happen.
Further to the questions that have been asked, the Minister might hide behind operational independence, but what does it say about this country when we are the only one that does not believe the threshold of evidence has been met? What leadership is the Minister providing, so that the UK takes this seriously, as all these other countries are doing?
Unless the hon. Gentleman can come up with an alternative to operational independence and the rule of law, he has to understand that that is how we operate. The National Crime Agency has been asked on a number of occasions, before a number of Select Committees in this House, about exactly that case. I refer him to the answers that the National Crime Agency gave to those Committees.
What proportion of Scottish limited partnerships have not provided ownership information, and how many have been fined for not doing so?
I cannot give the hon. Gentleman the answer from this Dispatch Box, but like the Scottish National party, I have been concerned that Scottish limited partnerships are remarkably popular with countries such as Russia and Ukraine. Far greater numbers are being used by those countries than they currently are by Scotland. I shall write to him with a detailed answer to his question.
Given the importance of wider economic sanctions to protect those in the most vulnerable countries in the world who are currently having their human rights routinely abused, what review has the Minister undertaken of the effectiveness of economic sanctions against businesses?
I will ask the Treasury, which leads on economic sanctions, to write to the hon. Lady with exact details of what assessment it has made of their impact. Sanctions, of course, do work in a number of scenarios. That is why we are keen to get the Sanctions and Anti-Money Laundering Bill through the House of Commons, working together to make sure that we get the Magnitsky amendment correct. It is certainly why this piece of legislation is very important.
France, Germany, Switzerland, Spain and many other countries have opened criminal investigations into the people who are directly responsible for the brutal murder of Sergei Magnitsky. Why is the United Kingdom the only country not to have done so?
Is the hon. Gentleman asking about opening an investigation or prosecuting? As I said earlier, we are not commenting on what investigations we have live and open. That has been very clear: we cannot comment on whether or not an investigation is open into anyone. Whether it is a Russian oligarch, people who are alleged concerning Magnitsky, or someone under investigation in the hon. Gentleman’s local constituency, that is not how it operates in this country, because we protect the operational independence of the police.
The best way to target Putin is to go after the people around him who enrich themselves to the tune of billions. It is estimated that people closely linked to Putin own property here in London worth more than £1 billion. The Minister could start by looking at the activities of Igor Shuvalov, who, as we have heard today, is reputed to own—just a few hundred yards from where we are standing now—flats worth £11.4 million, yet he earns just £112,000. That is clearly the result of corruption; what is the Minister going to do about it?
As the hon. Gentleman will have heard me say numerous times this afternoon, there are plenty of individuals who get pointed out to us and into whom we open investigations. What we cannot do is provide a running commentary on who is under investigation. As I have stated and as we have demonstrated in our legislation over the past few years, we on the Conservative Benches are determined to investigate and deal with overseas corruption and oligarchs putting money here. The best example I can give is the unexplained wealth order issued only a few weeks ago: it related to an overseas oligarch who was also a PEP and to £22 million of property in the south-east. We will continue to target such people because we think it is the right thing to do.
Foreign nationals still come to the London financial markets to raise funds and then repatriate them to organisations that may be the subject of western sanctions. What action are the Government taking to prevent that?
The Sanctions and Anti-Money Laundering Bill, which is coming through the House, will give us new and more tools to deal with such behaviour. When the Criminal Finance Act 2017 transited the House and people made the point about the Magnitsky amendment, I pointed out that it was against criminal assets, and when the sanctions Bill comes forward, we will take steps to address the issue. So we raised this problem long before it was an issue in the sanctions Bill—last year, during the passage of the 2017 Act. Overall, we are determined to tackle this and to send the right message. The hon. Lady will have heard the long list with which I tested your patience at the beginning, Mr Speaker, and I find it ironic that the Labour party, which came up with precisely almost nothing in government, is criticising this Government, who are actually capturing proceeds of crime and taking them away from bad people.
The laundromat scheme was first exposed in The Independent in 2014, and since then The Herald newspaper in Scotland has done excellent work highlighting the use of Scottish limited partnerships in that process. Given that the Government are now listening to my colleagues’ calls for action, can the Minister confirm a timeframe for legislation to address SLPs?
The hon. Gentleman is absolutely right. We are determined to try to deliver on that. The work is being led by the Department for Business, Energy and Industrial Strategy, and the Home Secretary and I are pressing the case to give hon. Members more solid answers about exactly when we will deal with it. I pay tribute to The Herald. Throughout all this, it has often been journalists who have made the difference in exposing all sorts of corruption around the world—and some have paid for it with their lives—which is one reason the Conservative party think that press freedom is so important.
In the Sanctions and Anti-Money Laundering Bill Committee, Ministers stated that the British property register would not be ready for three years and rejected amendments on tax havens in the overseas territories and Crown dependencies. The events of the past week or so have made this approach look pedestrian and too modest. Will Ministers now support similar amendments?
We are often up against some of the best-resourced and sophisticated crooks in the world, so we want to get it right and make sure it works. This will be the first measure of its kind in the world if we do it. Let us make sure it is correct and accurate, so that we can then act on it, gather evidence, seize assets and make the difference. I am sure the hon. Gentleman would not want us to rush through a half-hearted register that does not work.
An unacceptably large number of the Minister’s answers have involved being redirected to other agencies—people might wonder why the Government are so unaccountable on these issues—but perhaps he can answer a question about tier one investment visas. Many such visas were issued to Russians during a period when almost no background checks were carried out. What are the Government doing to look retrospectively at those cases to make sure that individuals with wealth obtained through dubious means cannot operate freely in our city and country?
The relevant part of the Home Office keeps a continual check on existing visas and new visa applications, and we will of course make sure that when something is wrong we take action either to remove a visa or prevent one from being issued.
A recent review of legal practices showed that only one third of them had taken the mandatory risk assessment approach to money laundering. What can be done to further push legal and accounting firms to do the right thing in the City of London?
The hon. Lady makes a very important point. I am leading the SARs reform programme, which we think will address the problem of “quantity not quality”. We want to ensure that those who submit suspicious activity reports do some of the work and to ensure that they produce reports of good quality, so that we can act on them. They have been used too defensively: banks have just loaded them up and left it to the operational partners to sift through them. We are also working with the regulators to ensure that we send strong messages to all the other facilitators who for too long have been let off taking a strong role in stopping money laundering.
The Minister was not able to respond immediately to the question from my hon. Friend the Member for Edinburgh South (Ian Murray) about Scottish limited partnerships and their ownership structure, perhaps because 71% of SLPs are registered in anonymous overseas companies and tax havens such as the British Virgin Islands. When will he legislate to bring SLPs within the scope of the persons of significant interest register to ensure that there is real transparency and to stop the siphoning of money?
I think that I did answer that question and the one asked by the hon. Member for Dundee East (Stewart Hosie). I made the point, as the hon. Gentleman has, that the vast majority of such arrangements are being used not by Scottish companies but by overseas companies. We are working with the Department for Business, Energy and Industrial Strategy to ensure that we get this right, but I am keen for measures to be introduced to stop their use by organised criminals around the world.
There does not seem to have been very hasty action by the Government in relation to the Magnitsky Act. Members on both sides of the House have been calling for that for a long time, and, indeed, the House signed up unanimously to an agreement many years ago.
Has the Minister ever tried to do a little piece of elementary research on a trust fund? Has he tried to find out who is the beneficial owner, or, for that matter, the controlling interest? Who actually benefits from any of these trust funds? Having had to do quite a lot of research myself recently, I know that it is impossible to find out anything. It is all tied up. No one can even find out who has appointed the trustees. It is a complete mystery. Let me say to the Minister that until he deals with that issue of trust funds in this country, we will never manage to deal fully with the money laundering or the corruption in the City.
The hon. Gentleman makes a powerful point. The hiding of identity is a big challenge for law enforcement agencies, and we must do more to tackle it. We expect 150,000 trusts to be on the register by this March, starting with the public register of beneficial ownership.
As I have said, there is more to be done about Scottish limited partnerships. On most occasions, we manage to find out who is behind them, but, as the hon. Gentleman has said, it takes a lot of effort, which I believe could be reduced. Once we know who is behind these shadowy organisations, we can sometimes take even more action against them.
On a point of order, Mr Speaker.
I think the point of order appertains to the recent exchanges, and I will therefore take it now.
I am grateful to you, Mr Speaker. We were hoping for a much more bipartisan approach today, but the Minister started off by making a statement in which he implied something that I do not think he wanted to imply, namely that we had not raised the issue recently. He implied that I had not raised it since, I think, 2016.
On 21 March 2017, Mr Speaker, you were kind enough to allow me a very similar urgent question, in which I asked the Government to address the allegations
“that, via an operation referred to as the “global laundromat”, banks based in Britain have been used to launder immense sums of money obtained from criminal activity in Russia linked to the FSB spy agency there.”—[Official Report, 21 March 2017; Vol. 623, c. 777-8.]
I am sure that the Minister would not want in any way to mislead the House, but I think it important for him to correct the record and to confirm that we have raised the matter consistently, not just in that urgent question but time and again during the Committee stage of the Sanctions and Anti-Money Laundering Bill.
The right hon. Gentleman has put the position very clearly on the record. The Minister is welcome to reply if he wishes. He is not obliged to do so, but if he does, it will stand in the Official Report.
Is the Minister bobbing?
I am grateful to the right hon. Member for Hayes and Harlington (John McDonnell) for referring to his stance back then. Before coming to the Chamber, I carried out a Hansard search for the word “oligarchs”, to which he has not referred. The only time it came up was in a 2016 report, when the right hon. Gentleman spoke about the schools White Paper. If Hansard was incorrect or I did not see that, I apologise to the right hon. Gentleman, but the clear point that I was trying to make was that Labour was almost entirely silent on all the measures that the Government introduced in the Criminal Finances Act 2017. This is all about something other than money.
I am grateful to the Minister. I simply say to him that Hansard is not incorrect, and it is very important that we acknowledge the magnificent work of those who prepare the Official Report. I am not going to call the right hon. Gentleman the Minister, whom I have known for a long time, a semantic pedant, because that would be unkind, but his point seemed to focus on the use of the word “oligarch”. He has made his own point in his own way, but the shadow Chancellor’s factual recollection is also very clearly on the record.
Leaving the EU: UK Ports (Customs)
(Urgent Question): To ask the Chancellor of the Exchequer if he will make a statement on customs clearance arrangements at UK ports after the UK leaves the European Union.
The Government have been clear that in leaving the European Union the UK will also leave its customs union, allowing us to establish and enhance our trading relationships with old allies and new friends around the world. The Government have also set out that in leaving the EU customs union, we will be guided by what delivers the greatest economic advantage to the United Kingdom and by three strategic objectives: continued UK-EU trade that is as frictionless as possible; avoiding a hard border on the island of Ireland; and establishing an independent international trade policy.
As we implement the decision of the British people to leave the EU at the end of March 2019, we want a deep and special partnership with the European Union. The Government set out in our future partnership paper last summer two options for our future customs arrangements—two options that most closely meet these objectives. One is a highly streamlined customs arrangement. That approach comprises a number of measures to help to minimise barriers to trade, from negotiating the continuation of some existing trade facilitations to the introduction of new technology-based solutions. The other is a new customs partnership, which is an unprecedented and innovative approach under which the UK would mirror the EU’s requirements for imports from the rest of the world that are destined for the EU, removing a need for a formal customs border between the UK and the EU. Those models were detailed again in the Government’s White Paper last October, and by the Prime Minister in her Mansion House speech and subsequent statement to the House. We look forward to discussing both those options with our European partners and with businesses in both the UK and the EU as negotiations progress.
I am grateful to the Minister for that reply, but when was the Transport Secretary proposing to tell the House—or indeed him—about the new policy of not checking goods at Dover after we leave the EU, as opposed to telling the BBC last Thursday:
“We don’t check lorries now—we’re not going to be checking lorries in Dover in the future ”?
Given that the Government are committed to leaving the customs union, but that all free trade agreements involve some checks at borders, how exactly can this be squared with no checks at all? Which border crossings will be covered by the no-checks policy? Will they just be ro-ro ports, for example? Are the Government confident that World Trade Organisation rules allow for not applying certain customs checks at some ports but not others? Which checks do the Government intend to forgo? Have the Government had any discussions with the French, Belgian or Dutch authorities about whether they intend to apply a reciprocal approach at Calais or other channel ports? Will there be no checks on goods that have arrived in Dover from outside the EU? What risk assessment has been undertaken and will Ministers publish it?
When is Parliament going to see the information and analysis that has apparently been shared with businesses— it is reported that they have been required to sign confidentiality agreements—about possible new customs arrangements? Lastly, when are Ministers finally going to realise that if they actually want frictionless trade with the EU and to keep an open border between Northern Ireland and the Republic of Ireland, the best way to achieve that is to remain in a customs union?
I thank the right hon. Gentleman for asking a variety of questions about what the Secretary of State for Transport said last Thursday. In addition to the remarks that the right hon. Gentleman mentioned, the Secretary of State also said that
“we will not in any circumstances create a hard border in Dover that requires us to stop every lorry in the port of Dover”.
That is absolutely right. The right hon. Gentleman will know that the discussions that we have had with other authorities in the EU27 are formal discussions, because the negotiations that we have been having with the EU have not been possible. However, some informal discussions have taken place.
The right hon. Gentleman raises the issue of confidentiality agreements for those with whom Her Majesty’s Revenue and Customs is in discussions. As I am sure he will know, this is an entirely normal state of affairs for such discussions. Incidentally, this works both ways, in that while there is confidentiality on the part of those private sector organisations, that is also binding on the Government, as anything of a commercially sensitive nature will not be divulged by the Government either.
The right hon. Gentleman raised the issue of Northern Ireland, on which we have made our position extremely clear: there will be no return to the hard border of the past. As we have made it clear to the EU27, we will not accept a situation in which we have a customs border down the Irish sea. We will respect the Belfast agreement, and we are engaged in further discussions with the Irish Government to come to a sensible arrangement that is in the mutual interests of ourselves, of Ireland and of the wider European Union.
Last week, my European Scrutiny Committee met Mr Michel Barnier in Brussels. Tonight, my Committee will issue a report on Brexit in the context of the UK ports and customs issue, and the jurisdiction that goes with it. Will the Minister confirm, in the context of the Secretary of State for Exiting the European Union’s statement with Mr Barnier today on the draft withdrawal agreement, that the British Government will stand firm on the question of not allowing the European Court of Justice exclusive or sole jurisdiction, given that articles 122 and 123 of that draft withdrawal agreement make significant concessions to the European Court?
We have made it clear that once we have exited the implementation period, the European Court of Justice will have no further remit. We will take back our laws, to be determined by our courts at every level, including the Supreme Court.
I reaffirm what my right hon. Friend the Member for Leeds Central (Hilary Benn) said earlier. On Thursday night, the Secretary of State for Transport promised a Dover studio audience that there would be no customs checks on goods vehicles passing through UK ports following our exit from the European Union. The Minister dodged every question that my right hon. Friend asked, but I will give him another opportunity to answer some of them.
It stands in complete contradiction to the Government’s wider position that, unlike Labour, they will not seek to form a customs union with EU member states after the transition period. Will the Minister confirm that it is now Government policy to discard protections on goods travelling into the country through a customs union while also refusing to check goods vehicles as a requirement to entry? Will he explain how tariffs will be applied and enforced without goods vehicles being checked by customs officials? Surely that would be in breach of World Trade Organisation rules—unless he knows something different. Can he give a single example of a nation that does not rely on either a customs union agreement or customs enforcement at its border? What are the Government’s plans to manage our trade relationships, to protect our own producers and to uphold environmental protections without either a customs agreement or border enforcement?
We all thought that the Government’s “cake and eat it” Brexit strategy was wildly misguided, but they now seem to have put us into a worse position that even fails to meet the low bar set by the Brexit Secretary when he committed to avoiding a “Mad Max-style”, “dystopian” Brexit. The Minister must set out clearly which of the options the Government are going to choose. Is it a customs union, as proposed by Labour, or goods checks at the borders? Or is it neither, as his Cabinet colleague has promised? For the sake of business confidence and planning, and of economic stability and continuity, will the Minister please ask the Chancellor to do us a favour and get to grips with the Government’s hokey-cokey Brexit policy, and tell the Transport Secretary—in the Defence Secretary’s words—to “go away” and “shut up”?
Well, we waited a long time to get to the end of that, and I am not sure whether we are any wiser as a consequence.
As the hon. Gentleman will know, we are leaving the customs union, and I set out in my opening remarks the two models that we are intent upon progressing with our European partners. I also stressed that we will arrive at a solution that is as frictionless as possible. I have been down to Dover to meet the organisation that runs the port, and also the Border Force personnel who are engaged with it, and I am fully familiar with the importance of a frictionless border. Of course, the other important news that we have had today is that we have concluded, subject to the European Council meeting this week, an implementation period for the arrangements, which will not only give us additional valuable time to provide certainty to businesses, but ensure that we have all the arrangements in place for a successful customs system going forward.
Will the Minister confirm that we currently have friction-free and successful trade with the rest of the world under WTO terms and its facilitation of a trade agreement? If there is no free trade agreement with the EU after March 2019, we can have exactly the same friction-free trade with them, with Germany trading as China and America do today.
My right hon. Friend is correct. We will be in a perfectly good position to ensure that we have near frictionless trade on day one, using the kind of facilitations that we are already using when it comes to the policing of our borders with the rest of the world, and indeed that exist between other countries such as Canada and the United States.
We waited a long time to get to the end of that, and I not sure that we are any further forward as a result. The Minister finally understands what the rest of the world has been thinking after they have read every statement, listened to every speech and played through every attempt at clarification that we have had from the Government since the day of the referendum. My bingo card is not quite complete, but we got “deep and special”, “unprecedented” and “innovative”. We got “frictionless” twice, and we also got “streamlined”. However, I do not think that I heard “taking back control”, which is where I missed out on the jackpot, possibly because it is difficult to talk about “taking back control of our borders” when the Minister is trying to justify why we are not going to have any customs controls and therefore no border controls of any kind.
I remind the Minister that the port of Dover reckons that 99% of its traffic goes to and from the European Union, and it takes the massive great lorries an average of two minutes to get through. The other 1% goes to the rest of the world, and it takes an average of 20 minutes for those lorries to get through. There is no degree of customs check that can prevent Dover—in fact, most of Kent—from becoming a car park. We have not even started to talk about the impact on the Welsh ports. Where will the border be for traffic going from Wales to Northern Ireland via the Republic of Ireland? All the possible locations for a border have already been ruled out.
Has the Minister read the Northern Ireland Affairs Committee report that was published at the end of last week? Has he read the report of the Exiting the European Union Committee that was published on Sunday morning? Has he read the Business, Energy and Industrial Strategy Committee’s report that was published this morning? All of them say that the Government’s obsession with leaving the customs union will simply not work. I draw his attention to a conclusion of the Exiting the European Union Committee’s report of December 2017:
“It is difficult to imagine any possible deal, consistent with WTO and other international treaties, that would be more damaging to the UK’s interests than leaving the EU with no deal whatsoever in place.”
Does the Minister agree with that? Does he understand that we are now barely six months away from when we effectively need a deal in place? When are the Government going to get rid of the clichés and soundbites, and start giving us genuine solutions to the problems that they, and they alone, have caused?
Order. It is always a pleasure to listen to the mellifluous tones of the hon. Gentleman, who spoke for only two and a half times as long as he was allotted. I hope that he will be saying to himself tonight, “Isn’t that Speaker a generous fellow?”
You are indeed a generous fellow, Mr Speaker. The nub of this issue is the misconception that having customs control at the border is the same thing as stopping every vehicle or jamming up Dover. There are approaches available—we set out them out at length in our White Paper last year, and we have been negotiating on them and will continue to put them forward to the EU—that use technology and the pre-lodging of customs declarations, and that may use inventory systems at ports or number plate recognition technology. All these approaches are perfectly capable of allowing traffic to move briskly through the ports, as indeed is the case today.
Surely the implication of this question is that after we leave the customs union, it would somehow—bizarrely—be in the interest of those on either side of this equation to want to impose friction on trade. Surely the EU would not want to do this, given its massive trade surplus. So are we not tilting at windmills here—or is this not, as the French would say, a mere canard?
My hon. Friend makes an extremely important point. As we know, there is a trade deficit in goods between ourselves and the EU, so it is clearly in the EU’s interests—and, particularly in the case of Dover and Calais, in France’s interests—to make sure that trade continues to flow smoothly.
The Minister referred to automated number plate recognition. Will he confirm that he has been discussing with the port of Dover extensive cameras, which could be part of his proposed technological solution? Will he also confirm that the Government rule out having such cameras at the Northern Ireland border, because they have ruled out any physical infrastructure at that border?
The right hon. Lady is right to say that the Government have clearly ruled out any infrastructure at the Northern Ireland border. In the discussions on Dover—not necessarily with myself directly, but through officials—all those options, including the number plate recognition to which she refers, have indeed been talked about.
As my right hon. Friend knows, if there were two countries that were ever going to have a completely frictionless border, they would be Norway and Sweden, because they are both in the single market, but, as we know, there is a hard border there. In any event, will he be so good as to go to his officials at the conclusion of his appearance in the House to ask them to make sure that the costs of the system the Government hope to achieve with our neighbours in the EU are fully calculated?
I thank my right hon. Friend for her question, but of course we do not yet know, as we negotiate these arrangements with the EU27, exactly what form of arrangements will be in place. Of course we will be assessing those carefully.
May I press the Minister a little more on his two alternatives to the customs union? He has posited the idea that one is a technological solution, but he has already acknowledged that it is not viable, because of the border with Northern Ireland, so this all rests on a customs partnership arrangement. Will he confirm not only that that would that require the UK to assess two separate tariff arrangements internally—one for us and one for the EU—but that we would be looking to the EU to assess both its own and the UK’s tariff arrangements simultaneously? Does that happen anywhere else in the world?
We have made it clear all along that the new customs partnership is an extremely innovative approach and would be a first, because this is a unique situation in which we and our European partners have a strong trading relationship and a near complete alignment of rules and regulations pertaining to our trading arrangements. The hon. Gentleman suggests that there is no alternative to the new customs partnership in relation to the border between Northern Ireland and Ireland, but that is not the Government’s position. We are confident that by using facilitations and various arrangements—[Interruption.] If he focuses for a moment on the kind of activity that is happening across the border between Northern Ireland and Ireland, such as fuel laundering, he will see that it has proven perfectly reasonable for the Police Service of Northern Ireland to intercept those engaged in such activities, well away from the border and very effectively, by using targeted approaches, as we might be able to do going forward.
I urge the Minister to reject the representations from the analogue Opposition parties, which seem to have a dystopian vision of analogue borders at which every single load is stopped. As the constituency representative for the port of Dover, I urge him to embrace digital borders, at which we have frictionless trade, risk-based stopping of trade and inspections where necessary, and the postponement of workplace checks and audits. In that way, the Labour party’s dystopian desire for Dover and Kent to be turned into a car park can be avoided, but only with investment. I urge the Minister to make the appropriate investment in systems to make that vision a reality as soon as possible.
I thank my hon. Friend for his comments and also take this opportunity to thank him for the sound advice and guidance that he, as the Member who represents Dover, has given to me. As he says, we can of course use technology to ease traffic flows. We will also invest as required to make sure that our borders function effectively. The Chancellor made it clear in the autumn Budget in November that £3 billion would be made available as necessary, across Departments, for that purpose.
I note that the Minister has disowned the Secretary of State for Transport’s policy brainwave, because the Government are saying that vehicles will be stopped at Dover, but not all of them. Given that 10,000 trucks pass through Dover every day, how long will the tailback be if, say, one out of every 10 additional trucks needs to be checked and each check takes five minutes? Where will the lorry parks be built that will be needed to accommodate that?
There will be no requirement for anything like the level of stoppages at Dover that the right hon. Gentleman suggests. We will use technology to facilitate the movement of trucks and goods through the port of Dover. If there is an intelligence-led requirement to stop any vehicles, that can be done outside the port of Dover. We will make sure that traffic through the port keeps flowing.
If we adopt unilateral free trade, we will not be the source of any friction, will we?
I thank my right hon. Friend for his succinct question. Of course, that very much depends on where we end up in respect of our free trade agreements with the European Union and with other countries.
Will the Minister confirm that the arrangements that will be agreed with the European Union will apply in exactly the same terms to the British overseas territories and specifically to Gibraltar, and that there will be no problems about that with Spain?
I refer the hon. Gentleman to the comments of the Secretary of State for Exiting the European Union this morning. I believe he has confirmed that Gibraltar will be part of the agreements that we are expecting the European Council to agree to very shortly, and that they will also extend to our Crown dependencies and overseas territories as appropriate.
Will my right hon. Friend take as inspiration the workings of DP World, the deep-water port in the south of Essex where thousands of lorries-worth of containers flow into the country from outside the customs union swiftly, slickly and smoothly? Will he look upon that as a potential solution for the Dover border?
I thank my hon. Friend for that point. I have no doubt that that is just one more example of where facilitations and technology can ensure that goods move efficiently across a customs frontier.
Does the Minister recognise that if there is no trade deal with the European Union, it will be a breach of World Trade Organisation rules to apply checks and tariffs to non-EU goods but not to EU goods?
The right hon. Gentleman is absolutely right that under WTO terms we would have to treat the various countries equally, but we are confident that there will be a deal. Indeed, we made huge progress on the phase 1 issues in December and have heard just today that we are looking clearly at an agreement on the implementation period. We will be going forward for further agreement with the European Union on a deal for this country and the EU.
Does my right hon. Friend agree that provisions related to a transition as per the mooted withdrawal agreement would not be effective until such an agreement were ratified and adopted, and that those stages will not be complete until next year? In that context, can he assure the House that upgraded capacity for inspections and declarations will be implemented behind the border now, so that trade can continue to flow whatever the outcome of negotiations with the EU by 29 March next year, and that this work will not be stood down?
As I have already said, we will make sure that those elements of infrastructure—the places where goods can be checked on an intelligence-led basis and the technology that is required to keep our customs borders moving—will be in place by the appropriate time.
If a Dublin-based company imports goods from mainland Europe in the European Union, puts them on a lorry, drives them through the frictionless border to Belfast, puts them on a ferry from Belfast to Liverpool, near my constituency, at what point do checks, and indeed facilitations, take place?
As the right hon. Gentleman will know, these matters are subject to negotiation at the present time, but what we will make absolutely certain of is that there is no hard border between Northern Ireland and the Republic of Ireland, that there is no customs border effectively within the Irish sea, that the Belfast agreement is respected, and that we have a relatively frictionless movement of goods across the Northern Ireland-Irish border.
People are talking about the customs union, a customs union, a customs partnership and, as the Prime Minister put it, a hopeful customs arrangement, but will my right hon. Friend accept that as far as businesses are concerned they do not really care what it is called as long as they do not have 10-mile queues at the border, they are not paying EU tariffs and they are not being clogged up with more bureaucracy and red tape?
My hon. Friend is absolutely right. What matters to business is that we keep the borders moving, and I have explained in my responses to many questions this afternoon exactly how we will approach that.
Jaguar Land Rover is postponing investment in a new generation of electric vehicles until it is satisfied that there will be frictionless trade with the EU. Given that the Government have ruled out a customs union with the EU, what arrangements will the Government make that will both be achievable with the EU and satisfy Jaguar Land Rover so that it invests in much-needed electric vehicles?
The Government are well aware of the particular needs of the motor manufacturing sector, with just-in-time delivery and the fact that some components move across what will potentially become a customs border in the future. Those needs are a priority for us during the negotiations. I have no doubt that the implementation period that has been announced today will be one of the things that will drive the economy forward even faster. The hon. Gentleman will know from the spring statement that the Office for Budget Responsibility has already upped the estimates of growth for next year, and hopefully the implementation period will make a further positive contribution to that.
Wales is ideally based as a land bridge for many Irish exporters. Indeed, more than 70% of Irish road freight comes into the UK through Welsh ports. If a border is placed in the Irish sea, Welsh ports could face severe delays and disruptions. Will the Minister outline what assessment the Government have made of the potential impact on Welsh ports, and of whether trade will be diverted or displaced elsewhere?
The good news for the hon. Gentleman is that there will be no circumstance under which this Government, or a British Prime Minister, will negotiate a deal in which we have an effective customs border between Northern Ireland and other parts of the United Kingdom.
Currently, goods that require checks go into a lorry park just off the M20, which apparently has 82 parking spaces, but, never fear, there will be a new lorry park just off the M20. However, it seems that the plans to build it are completely snarled up in a judicial review. Will the Minister please give an update on how the lorry park will save the day, and by when it will be built?
We will ensure that sufficient facilities are available for checks. As is the case at the moment, many of those checks will occur at business premises and storage facilities, including Stop 24, for example.
As an MP for a city that has a port and that voted to leave the EU, taking back control of our borders was one of the most common reasons that I heard for people voting to leave. Will the comments attributed to the Transport Secretary about having no hard border at Dover apply to Hull as well?
The Transport Secretary said that not every vehicle will be stopped, and that is absolutely right. In fact, we will use intelligence-led, technologically driven interceptions where appropriate, as is currently the case for our dealings with countries outside the European Union.
When will Ministers realise that the mantra of “frictionless border, frictionless border, frictionless border” is not standing up to scrutiny? Is he aware that Irish companies are already making contingency plans to go directly to mainland Europe, thereby bypassing Welsh, Scottish and English ports? Does he understand the effect that that will have on those port communities, but also on Her Majesty’s Treasury?
We are committed to, and confident that we will achieve, a frictionless border between Northern Ireland and the Republic of Ireland that will facilitate trade in the future.
Will ports on mainland Europe reciprocate by having no customs checks for UK goods?
It will depend on exactly what transpires in the negotiations, as the hon. Gentleman knows.