Wednesday 5 December 2018
[Geraint Davies in the Chair]
Free Schools and Academies in England
I beg to move,
That this House has considered the future of free schools and academies in England.
I am delighted to have secured the debate, and it is a pleasure to serve under your chairmanship, Mr Davies. I pay tribute to my right hon. Friend the Member for Surrey Heath (Michael Gove) for his perseverance, when he was Education Secretary, in bringing forward the Academies Act 2010, which revolutionised the way schools operate. I also pay tribute to the Minister for School Standards, my right hon. Friend the Member for Bognor Regis and Littlehampton (Nick Gibb)—a veritable rock of stability in Government—who has been making things happen almost throughout the process. Naysayers said that it would not work; they called it an experiment and accused us of creating a divide in the state school system. Eight years on, we see that they were wrong. The first free schools and new academies opened in 2011 and our schools are performing better than ever. Whereas only 68% of state-funded schools were good or outstanding in 2010, that jumped to 89% at the end of August 2017.
Nowhere is more exemplary of the benefits that free schools and academies bring to the system than the two boroughs in my constituency—the Royal Borough of Kensington and Chelsea, and Hammersmith and Fulham. Indeed, K and C and H and F—under the Conservatives until 2014—have been the vibrant nucleus of schools reform since 2010. In those two boroughs, which are the smallest in London, an astonishing five new secondary schools have opened since 2010, and every one of them is a free school or academy. Kensington Aldridge Academy, Chelsea Academy, Hammersmith Academy, Fulham Boys School and West London Free School are providing places for more than 3,700 students. I attended three of the openings—two of them with the Secretary of State at the time.
This year’s GCSE results show that the schools are doing fantastically well: 85% of exams at West London Free School were awarded grades 9 to 4, which in old money is A* to C. Chelsea Academy’s results were in the top 10% nationally, with 30% of its English and maths awards at grades equivalent to the old A* and A grades. At Kensington Aldridge Academy, at the foot of Grenfell Tower and deeply affected by the tragedy last year, students perform a third of a grade better at A-level than those with the same GCSE results in other schools. That is the highest progress score in the whole borough. Four of Britain’s top 12 primary schools are in Kensington and Chelsea. It is a remarkable record.
Kensington and Chelsea has the best schools in the country, and that is even more remarkable given the fact that the most affluent 50% of the borough chooses to opt out of the state system in its entirety. Despite that, the borough has four of the 12 best performing primary schools in the country, and some excellent secondary schools. Throughout both boroughs, including conversions to academy status, we have no fewer than 30 free schools and academies. I am delighted to say that every one of them—100%—has received a rating of good or outstanding. That is a testament to the success of those schools.
One of the great things about the free schools and academies programme is the autonomy they have in setting pay levels, conditions and hours, which allows them to keep the best talent in the classrooms. When teachers play an indispensable role in nurturing the young minds of children, they should feel a part of the decision-making process, because recognising teachers as experts in their fields and empowering them in that way is a vital part of retention. Fulham Boys School is an excellent example of that. I should declare that I am a co-patron of the school. Remarkably for an inner-London school, in the past four years only five teachers have left—every one of them to be promoted, or because for life reasons they were moving out of London. It is possible to find other state-funded schools that have had a turnover of 100% in the same period. Teachers see themselves spending their entire career at Fulham Boys School and they become long-term mentors to students—familiar, stable figures throughout a child’s education.
I congratulate the right hon. Gentleman on securing the debate. Schools also have autonomy over exclusion policy. The Education Committee looked at the escalating number of exclusions from academies in the borough of Stockton-on-Tees, but it has no power to influence what the schools do. Does the right hon. Gentleman agree that Ministers need to look more closely at exclusions and why they are happening, and at why some children are denied a full education?
I think that it is sensible to keep those policies under review at all times. I am not familiar with the situation in Stockton-on-Tees, but I think that the hon. Gentleman makes a fair point, and I am sure that the Minister has noted it.
I want to quote a helpful contribution from the headmaster of the Fulham Boys School, a remarkable man called Alun Ebenezer—he is from your part of the world, Mr Davies, although he was in Cardiff, not Swansea. He wrote that he was happy in his position:
“And yet, eight months later, I decided to apply for a headship at a school that had no site, no pupils, no staff, no exam results, nothing in the trophy cabinet and was 150 miles from my homeland. Why?
Because the opportunity to build a school from scratch, the vision set out for that school and the ideology of the free school movement was so alluring. It was an opportunity to make a difference, challenge society, transform young people’s lives; to shake up the established order. I came to London to show what a free school could do when it properly embraces its freedom…I believe the first four years of FBS have done just that.”
That is the kind of can-do attitude that is seen in so many schools in my constituency.
Another example of schools doing as well as that is the group of Ark schools, of which there are five between the two boroughs. They have led the way in teacher training innovations. Their Now Teach venture, set up in 2016, was designed to encourage high-flyers to retrain as teachers. They get on board the lawyers, doctors and bankers of the world to inspire children and become role models in the classroom. Such innovation is possible only when schools are freed from red tape and the bureaucratic decision-making processes of councils.
Will my right hon. Friend add parents to the list of people that schools should involve? It is crucial that they are involved in a big way in the running of schools. That solves many of the problems that teachers have with things such as discipline.
My hon. Friend has hit the nail on the head. The role of parents is vital. Many free schools are parent-led initiatives. I first met people involved with Fulham Boys School in late 2010 or early 2011, along with the then Secretary of State for Education, to discuss how to proceed. Groups of parents in my constituency come to me all the time with all kinds of innovative ideas. I shall talk about some of the problems they face, particularly with finding sites, but my hon. Friend has made a powerful point.
Schools of the kind I am talking about are also doing extremely well nationally, with nearly double the proportion of primary schools rated outstanding, compared with all state-funded primary schools. Secondary free schools and academies are also ahead of state-run maintained schools in the proportion rated outstanding; 30% of free schools have been judged outstanding, compared with 21% of other schools. I see more and more demand. I have come across groups looking for particular specialisms, such as the group of Spanish-speaking Fulham residents who have come to talk to me about setting up a bilingual free school, and another from Fulham’s French community. Other people are looking at subject specialisms. The idea has really driven innovation in my constituency.
However, some issues with the system still need ironing out. Despite all this excellent news, we must not be complacent. There should be no presumption of preferred suppliers of academy chains.
I am grateful to the right hon. Gentleman for taking a second intervention. We can all celebrate the success of schools in local authorities as well as academies, and it is great that the Government built on the legacy left by the Blair Government, which invested tremendously in education over many years. Does he share my concern about support for failing academies? The regional schools commissioner in the north-east is struggling to find a partner for one of our schools in the Stockton borough. It was even suggested at one stage that a failing academy chain should take it over. Months later, it still does not have a partner, because when people look at the books they realise that the falling roll means there are insufficient resources to do what they need to achieve. Ministers need to intervene there quite heavily.
Again, I am not familiar with the particular local circumstances of the hon. Gentleman’s area. I would say that of course there will be examples of schools in difficulties, across all categories of school, but the statistics for this are absolutely clear: free schools and academies are significantly more likely to be succeeding than other schools. That is what the evidence clearly shows. But I agree that any school facing difficulties will need careful attention from relevant local or national authorities.
The right hon. Gentleman makes a passionate defence of the schools in his constituency, which is the first thing a constituency MP does, but there is no evidence anywhere to show that academisation means that schools are performing better.
I disagree. I have already read out quite a bit of evidence from the statistics behind the academies outperforming the rest of the sector: 65% of those inspected saw their grades improve from inadequate to either good or outstanding, having been transformed into academies. Multi-academy trusts enable our best performing schools to help struggling schools improve all the time. The evidence speaks for itself in the statistics I read out earlier and in the Government’s overall improvement in school standards.
Returning to my point about where we need to improve, one size does not fit all for education. Schools cannot simply be transposed from one part of the country to another or rolled out in a cookie-cutter approach simply because they have worked in one format. There has to be room for local organic growth. I will put on the record my frustration with the Education and Skills Funding Agency, which must do better at working with schools to anticipate and resolve problems in site delivery. The Fulham Boys School, which has been waiting to move to its new site for some time now, has been particularly affected. The ESFA should, in this regard, harness local knowledge and relationships rather than necessarily relying on centralised procurement processes.
Schools need certainty to plan for their futures. I thank the current Secretary of State for meeting me and the school last summer—I know we have another school coming up—and trying to drive through the move to the new site in Heckfield Place in my constituency. I will quote again from the school’s headmaster, whose blog post title overdoes it the other way. It is entitled, “Why the free school movement will fail”, which I think is far too pessimistic. The title does not really match the content. He writes:
“My view, shaped over the last 4 years, is that bureaucrats’ delivery of Free school policy is directly frustrating government’s aspirations for it… Secondly, Free schools like FBS are constantly being frustrated and hampered by slow moving bureaucracy, red tape and ‘process’.”
I will add into the mix here that one of the most extraordinary meetings I ever had in Government, when I was a Minister, was taking the Fulham Boys School in to meet some of the ESFA officials. One official—admittedly, he was an outside contractor—said to the Fulham Boys School, which is also a Church of England school, “You are a faith school, so you must have belief that your school will open.” He could not offer specific reassurances on the site or when the contractors doing the site would be ready. He simply said to them that, as a faith school, they needed to believe. I do not know how religious you are, Mr Davies, but I would say that even the most evangelical of people would want to see something slightly more concrete than that on the table.
Unfortunately, progress has come to a grinding halt under Labour in Hammersmith and Fulham. The borough has failed to provide additional school places that are needed, particularly for the bulge in secondary school numbers that is coming up. Ironically, despite all these new schools, the borough now has the lowest figure for first-choice secondary school placements in England—it is absolutely rock bottom of that league table. Hammersmith and Fulham simply does not have enough places at quality schools that parents want their children to go to.
The council itself predicts that by 2027 there will be a deficit of 327 places for students between years 7 and 11, not including sixth form. That is 327 students without a place by the year 2027. Kensington and Chelsea also has a problem, as the figure there is projected to stand at 195 students by 2023-24. There is also something there that needs fixing. Creating additional secondary school places is a challenge in a constituency such as mine, especially finding sites in the two boroughs I represent, where land is incredibly expensive. We need to recognise some of the difficulty in doing that. It is easier said than done.
Nevertheless, the popularity of these schools at secondary level is evidenced by how over-subscribed they are. West London Free School receives nearly 10 applications for every year 7 place. At Lady Margaret School, which is a conversion to an academy, it is nearly seven applicants per place. These schools continually top parents’ lists of first preferences, and all of them outperform others in their area. It is, of course, great news that the Department for Education expects around another 1,000 maintained schools to become academies over the next two years, and that 110 new schools opening by 2020 will be free schools. There was also news in September that 53 new free schools and one university technical college will be creating up to 40,000 new school places.
That is the picture locally: excellence, popularity of these schools, and continuing drive from parents to create more of them. We have a deficit of school places and parents are demanding these kinds of innovative schools, but they are concerned—I will put my cards on the table—at what they are hearing from the Labour party about its plans. I was amazed at the speech by the shadow Secretary of State for Education at the Labour party conference. I doubt that you personally had the misfortune to be there, Mr Davies, because I know you are a sensible man, but she said—
Order. Mr Hands, it is probably not a good idea to make assumptions about the Chair to which I cannot respond, but do continue.
I apologise, Mr Davies. You are quite right, of course. The shadow Secretary of State for Education said:
“We’ll start by immediately ending the Tories’ academy and free schools programmes. They neither improve standards nor empower staff or parents.”
I put it to the Opposition spokesman today that I have outlined in 17 minutes a lot of the progress that has been made in my constituency and the popularity and success of these schools. Parents with children at the schools are alarmed at the Labour party’s position and what it might mean, particularly if they have a Labour council that also believes in his policy. I invite him to put on record that these parents and all the groups coming to see me now who want to set up new free schools have no reason to be afraid. There is an incredible diversity of parents and others looking to take advantage of this innovation, and it would be fantastic if we could hear from him that their fears are unfounded. I will sit down and give others an opportunity to contribute to the debate, but I look forward to hearing the responses from the Front Benches in due course.
It is a pleasure to serve under your chairmanship, Mr Davies. I thank the right hon. Member for Chelsea and Fulham (Greg Hands) for securing the debate and for giving us an insight into how schools are improving in his constituency. I think he will find that our experience in Ellesmere Port and Neston is a little bit more mixed. Of course, every area is slightly different, but one thing he said that I was very interested to hear was about staff turnover in a particular school. That is a real challenge in trying to drive up standards, and I would certainly like to hear more, perhaps after the debate, about what was done in that school to keep staff numbers so stable, because there is no doubt that the best schools are those that can recruit and retain the most impressive staff.
I must declare an interest: my wife is the cabinet member for children and young people at Cheshire West and Chester Council, and two of my children attend a local school in my constituency.
Cheshire West and Chester Council has an impressive record in education, with more than 90% of its schools rated good or outstanding and a plan for every school in the borough to reach that standard. If that council were a multi-academy trust, Ministers would be singing its praises and finding ways to bring struggling schools from across the area under its leadership. Instead, because it is a local authority, the push has been in the opposite direction, with pressure put on governing bodies to convert schools to academies. That is a perfect example of why Government policy is not always about rewarding what works best or bringing people together to improve. This policy is about an ideological drive towards academies and free schools, and I think that, contrary to what the right hon. Gentleman said, it is an experiment that is failing.
The flaws in the Government’s drive towards academisation at all costs are clear to see in my constituency, following the serious decline of one academy over a number of years, to the extent that an entire cohort of young people have in effect been failed by the system. That is not to say that there was not some excellent teaching at the school or that we are not incredibly proud of the skills and talents of our young people, but when inspection after inspection raised serious concerns, something needed to be done. If it had been a local authority school, there is no doubt that that would have been enough for the Government to declare that the leadership of the school had failed and the school would need to be converted into an academy. Instead, after years of indecision, the remedy prescribed is more of the same.
A decision has been made to re-broker the schools within the trust to new sponsors, and although we are all hoping for the best from the new sponsors, parents are understandably anxious to ensure that the same situation does not arise. I know that the new sponsors are making real efforts to engage with parents. However, the process took far too long, and all the time the council was willing and able to step in and help, had it been asked. I would therefore like the Minister to explain, if he can, what the rationale is for preventing high-achieving local authorities such as Cheshire West and Chester from bringing academies back under their control. Is there a sound evidence base for the policy, and does it have the support of headteachers and teachers, or is it in reality an ideological decision?
My hon. Friend the Member for Stockton North (Alex Cunningham) referred to this, but when I consider that there are more than 100 failing academies, looking for new sponsors, that are responsible for 70,000 children, I have to conclude that ideology is hampering those children’s opportunity to get a good education, because there does not appear to be a plan B. We have heard a lot about there being no plan Bs in other areas recently, and it appears that there is no plan B for failing academies either.
Even if my local school was an isolated case, that would be reason enough to revisit the Government’s approach, but a Schools Week investigation found that at least 91 multi-academy trusts had closed or were in the process of being wound up since 2014. The Government hand out grants of between £70,000 and £150,000 for new academy sponsors to set up a trust, and cover running costs until the first school opens. If each of the 91 closed trusts received just the lowest possible grant, which of course may not have been the case—it may have been more—the Government will have paid at least £6.1 million to set them up. Then there are the debts that the Department has to write off when a trust collapses—£3 million in the case of University of Chester Academies Trust, a deficit in the region of £8 million at the Schools Company Trust, £500,000 in the case of Lilac Sky Schools Academy Trust and £300,000 owed by the Collective Spirit Community Trust.
In a time of real-terms cuts to local schools budgets, how can the Government justify spending at least £10 million, if not a lot more, on failing multi-academy trusts? Then there is money coming out at the other end, with reports of an academy head receiving an £850,000 pay-off. That simply would not be allowed anywhere else in the public sector, so why is it allowed in this case?
It is simply not a level playing field at the moment. A local school tells me that it is desperate to expand, but does not have the opportunity to bid for capital funding to achieve that aim. How can it build on its success when it is unable to build? I am sure that if it reopened as a free school, there would be no problem in getting the cash, but why does it need to reinvent the wheel? Why are existing schools that have put the effort in, have made great improvements and are already an established part of the community discriminated against because they are not part of the latest fad from Government? How about a capital funding policy that rewards improvement and looks at where existing provision can be augmented?
Has all the money spent on academies been well spent? Let us take the words of David Laws:
“What we know is the most successful part of the academisation programme was the early part of it…Those early academies had absolutely everything thrown at them. They were academised school by school, with huge ministerial intervention. The new governors were almost hand-picked. They often brought in the best headteachers to replace failing management teams. They had new buildings. Sponsors had to put in extra cash.”
Picking up on the intervention from my hon. Friend the Member for Wythenshawe and Sale East (Mike Kane) on the Front Bench, David Laws went on to say:
“Our research shows that much of the programme since then has had little impact on standards.”
Another issue that arises from the programme of mass academisation that we have seen in recent years is that the local authority has become the admissions authority in name only. Of course, the net result of that is that some schools end up being over-subscribed, which exacerbates the chaos that we are already getting because an academy-led system means that we get an increasingly lopsided and unstrategic approach, with more and more children being taught out of area because of the way that schools can set their own admissions policies now.
That has also, I think, led to a rise in the number of children being home-schooled. That figure has risen by more than 40% in the past three years, according to figures obtained by the BBC. That is not about a broken admissions system; it is about schools perhaps suggesting that a particular child could be home-schooled to avoid an exclusion or that the school environment might not be the best place for the child if they have special educational needs. Yes, some parents are just exercising parental choice in home-schooling their children, but surely the rise in the number of academies and the rise in the number of home-schooled children at least needs to be examined to see whether that is something more than a coincidence.
Who is monitoring and evaluating the explosion in home-schooling? Has there been a 40% increase in resources to facilitate such monitoring? Are we confident that the legislation and guidance in this area are as up to date as they need to be? Are we comfortable that so many children are now being educated in that way? Is it a great example of parental choice, or have parents been forced down that route because the school that their children were in, or the system, led them to that place? What efforts are being made to enable children being home-schooled to return to school? What scrutiny is taking place of schools or areas that have higher than average levels of home-schooling? Is any analysis done of variations?
Those are not easy questions to answer, but they should be asked. I fear that because we have a fragmented system, once a child starts to be home-educated, they become someone else’s responsibility. That is the wrong approach. We owe it to all children to ensure that they get the very best education, no matter where they are.
I would like the current landscape in education to be altered so that there is accountability, transparency and a level playing field. At the moment, I suggest, we have none of those things.
It is a pleasure to serve under your chairmanship, Mr Davies. I thank my right hon. Friend the Member for Chelsea and Fulham (Greg Hands) for introducing this subject, because it is one that I have spent quite a considerable amount of my time specialising in within my constituency. I also thank my right hon. Friend the Minister, who has been incredibly courteous to me over the years, meeting with me and with schools of all sizes so that we can discuss problems. I place on record my sincere thanks to him.
One thing that I have been able to do in specialising in this area is to visit every school in my constituency. I think, from memory, that that is more than 100 schools, which is quite a lot. I have not done that all in one year; I have done it over a number of years, given that we have only Fridays and that the schools are on holiday for quite a lot of the year. But I have done it; I have visited all of them.
I would like to mention one school in particular that fits in with the subject of this debate, the Europa School in Culham in my constituency. Before I describe it, I re-emphasis the point that my right hon. Friend the Member for Chelsea and Fulham made about how free schools offer considerable flexibility to reflect a particular way in which parents want their children to be taught. In this case, being a free school offers a particular mindset for how to approach the area, which we should all bear in mind.
The Europa School is the successor to the European School. I am not going to get into a Brexit debate—in fact, I was at a naval dinner last night where, if anyone mentioned the term “Brexit”, they had to drink a large measure of neat rum.
While I would love that to be the case here, I suspect it will not occur.
The European School had a distinguished record. It was set up when lots of European parents were over to work at the Culham Centre for Fusion Energy at Oxford University and at the Harwell science centre. For several reasons, the European School’s funding dried up, so the Europa School was started as its successor, and has gradually taken over its workings.
The Europa School was set up as a free school, because that is what the parents wanted. They wanted the particular type of education that the European School offered to continue through the free school. That type of education was a way of approaching subjects in original languages. Children did not go and learn in French, Spanish, German or English. They were taught in all those languages, so they could end up having history in German or geography in Spanish, and so on throughout the complete list of subjects. That is a valuable way of teaching. The parents wanted that system to continue in the school, and it is being continued.
To encapsulate that teaching at the end of the process, the parents also wanted the children to take the European Baccalaureate, which offers a comprehensive system for evaluating children at roughly the equivalent A-level period that they would have to face. We need to hold fast to that in what I say next.
We must not forget that the school was principally set up to deal with parents of European origin in the area. The approach to teaching languages has proved immensely successful—so successful that we are now in a situation where non-European parents are desperate for their children to enter the school and be taught in that way. Because it is a free school, it can offer that way of teaching and it can say to the parents, “We can take your child in.” To be honest, I think it is a superb way of being taught languages.
The problem comes about because of the European Baccalaureate. As I said, the school is desperate to continue teaching it, but there is some difficulty about the ownership of the copyright for it, and a distinction is being made as to whether that is in the gift of the European Commission or the Department. The school has had some interaction with the Department about the issue, which needs to be resolved. It is important because that way of teaching is very special, and people have become not only wedded to it, but so attracted to it that it attracts parents from a wide area. Earlier this year, I presented a petition from something like 2,500 or 3,000 parents and friends of the school in the House of Commons to try to encourage the Government to make sure that the European Baccalaureate can continue to be taught there.
There is something special about free schools, particularly in what they can teach and the way that they can teach it. The Europa School illustrates that above all, which is why I have spent the last few minutes telling hon. Members about it. It is a good example of how free schools work, how they can take the attitudes of parents and make them a reality, and how they can, in this case, through the European Baccalaureate, continue to offer something of enormous benefit to children. I think the Minister agrees that there is no issue of quality about the European Baccalaureate; it provides just the same quality that children would get if they were taking traditional A-levels. For that reason, I fully support the school.
It is a pleasure to serve under your chairmanship, Mr Davies. I congratulate the right hon. Member for Chelsea and Fulham (Greg Hands), the former Chief Secretary to the Treasury, on securing this important debate. His past role means that he must understand the numbers.
As I said, we should celebrate the success of all our schools, regardless of where they come from. Even in those that are not doing so well, perhaps we have something to celebrate as they strive to deliver for our children. One school in my constituency that has not gone down the academy route is the Northfield School in Billingham. I was delighted to join it when it achieved the Artsmark a few weeks ago. The school band and choir were waiting for me as I arrived and it was a tremendous pleasure to be at that extremely successful school.
I also talked about the Labour Government’s legacy. I appreciate that the coalition Government and the two Conservative Governments since have built on the Blair legacy, which saw schools funding brought up to realistic levels by more than doubling it in Budgets during that time. That was when we saw the increase in the number of teaching assistants in schools and in resources, and a capital programme that I do not think has quite been equalled yet by the Government. That considerable programme has made a huge difference to the education of young people in our communities.
There is success, but there are places where success does not yet exist. We have to put a great emphasis on everybody who is succeeding, but we need to put an even greater emphasis on those who are not. The first two academies in the Stockton-on-Tees borough were the North Shore Academy and the Thornaby Academy. Both schools have tended to bump along the bottom. That said, the North Shore Academy is now showing real progress, which I celebrate. It has relatively low numbers, however, so budgets are a major issue, particularly since the Government introduced their fair funding programme that saw funding move from schools in the north with considerable special needs to those elsewhere in the country.
I referred to the Thornaby Academy when I talked about support for failing academies and the bizarre proposal from the regional schools commissioner at one point that a failing academies chain should come in and work alongside it. It is still waiting for a partner to help improve it, but because of its falling numbers, its budgets are extremely limited, so it struggles considerably—so much, in fact, that the local authority is contemplating subsidising it and putting resources into it to ensure that it can survive a little longer. So what we need to know from the Minister is how we will get schools such as these achieving to the levels that we have been celebrating earlier today.
In an intervention, I talked a little about exclusions. There was even a television programme on exclusions last night. I only have second-hand information about it because, of course, I was one of the many people who were here very late last night. That programme looked at what happens in some schools where children are put into a room called the “ready to learn room”, so they are excluded and taken out of the classroom. I understand why children need to be removed from classrooms at times; it is because they are disruptive to others. However, those children also need support—real support—and putting them in a room and isolating them is not necessarily the right idea.
At least one school in the Stockton borough puts children into pods, so that they are sitting in a little box and facing a blank wall, when they are supposed to be getting on with work. Yet those children are the ones who are possibly—indeed probably—the most likely to be excluded. And when they are excluded permanently, they end up back in the arms of the local authority, even though local authorities have been stripped of resources and do not really have the ability to support young people in the way they would like to.
Within the Stockton borough—it is probably the same across the country—one of the greatest pressures on funding is the pressure on high-needs funding. Stockton experienced a £2.5 million overspend in that funding in the past financial year and it is projecting that it will have a similar overspend in 2018-19. That is because it has to support the youngsters who are excluded from academies, while also doing other work; I appreciate that. Nevertheless, it has to support those children.
The council’s view is that there is just insufficient high-needs funding in the system. It continues to lobby for an increased funding deal and I am sure the Minister realises that that is what I am doing to him now: I am actually lobbying him directly for more high-needs funding for children, not only in the Stockton borough but across the country.
Of course, in the absence of additional funding from central Government, the local authority is taking action to reduce costs in all sorts of areas, to live within the funding envelope that is available to it, but that is simply proving more and more difficult every single year.
The local schools forum agreed at its meeting on 27 November to submit a request to the Secretary of State to transfer £1.4 million of the schools block to the high-needs budget. I hope the Minister will consider that very carefully, in order to give these schools the leg-up that they need. It was not an easy decision for the forum to take, because schools are really concerned about the lack of funding in the whole system. Some areas, such as ours, have actually suffered because of some of the fair funding decisions and, of course, because of the number of pupils going into particular schools. I would very much welcome the Minister’s view on that issue, but what is he going to do specifically about high-needs funding in the longer term?
Yes, let us celebrate success. I love celebrating success; I just love going into our schools. The atmosphere is tremendous and there is no doubt that generally children are very happy in school, and happy children learn much more quickly than those who are unhappy.
So we really need to think about where the support services are. We know about special educational needs and we know that certain children need particular support, and yet special needs budgets are being squeezed in these years and we really need to do more to support those budgets, so that those children can get the support they need, become happy children and learn.
I will continue to celebrate successes, but I just hope that the Minister will recognise that although we generally have a very successful schools system in this country, there are many, many children—hundreds of thousands of children—who are still being failed because we do not have the recipe right. We need to get that recipe right as soon as possible.
As ever, Mr Davies, it is a pleasure to serve under your chairmanship.
I congratulate the right hon. Member for Chelsea and Fulham (Greg Hands) on securing this important debate. It is a debate without many Members; the House sat very late last night with the Brexit deliberations. I understand that the right hon. Gentleman went to Dr Challoner’s Grammar School. Its motto is “Ad Astra Per Aspera”, which means, “We look to the stars through difficulties”. That might be good advice for the current Government, as they navigate or steer the ship through the Brexit waters. However, other Labour Members will agree that, as things currently stand, the Government are steering using celestial navigation on a cloudy night. Anyway, there are not too many Members here in Westminster Hall today, because so many were in the House last night.
The reality of the current school system is that it is broken, and that it has been fragmented beyond repair. The right hon. Gentleman talked about the Secretary of State for Environment, Food and Rural Affairs, the right hon. Member for Surrey Heath (Michael Gove), who threw the system up, broke it and then saw how it would coalesce together. The right hon. Gentleman said that he wanted to see us go up in the PISA standings—the programme for international student assessment standings—in terms of standards. We know that has not happened; because of the reforms, that just has not worked at all. Also, the system is in parts unfair and unaccountable, as has been said, and in most places it is not being led by the needs of local communities.
I did a simple Google search on academies and schools today, just to see what would come up. Day in and day out, we see some of the problems that the system is faced with today. Amanda Spielman, the chief inspector of Ofsted, has said that it is a “halfway-house” and “inadequate”, and that it does not have enough capacity. There are not enough teachers and leadership in the system, and schools are being left in limbo for far too long, which is a point I will come on to in just a moment. In fact, one school has been left in limbo—without a sponsor—for seven years. That was the result of the first part of my Google search.
May I take it from what the shadow Minister is saying that he endorses his boss’s proposal, which is immediately to end the Tories’ academy and free school programme? Can he confirm that today?
I will come on to say what our programme is. We will see new schools and new academies, but we will bring them in where they are accountable to local people, where proper spatial planning is done, and where numbers are consistent with the school places being brought forward. At the moment there is no accountability; I will explain that later in my speech.
In the hon. Gentleman’s policy, the future of those free schools and academies will be accountable to local people. How will that differ from existing county schools?
Currently, we have a system that is unaccountable. The hon. Member for Henley (John Howell) had to raise issues of pedagogical knowledge and how a school teaches, directly with the Minister. We cannot run 22,000 schools in England and Wales from Whitehall; nobody expects that. So the system will be local and accountable when Labour comes to power. That is what parents want. We have seen parents being cut out of academies and coming off governing bodies across our land; we want parents driving the policies of our local schools with local elected authorities.
Secondly, if someone does a simple Google search, they will find that the Department for Education itself has recently named and shamed 88 academies and trusts for failing to publish their financial returns.
The third thing that came out of my Google search today is that currently the academies—I emphasise that this has just been reported today—have a £6.1 billion deficit within the system. What is going on with the accountability and financing of this programme?
Finally, I will say one more thing on this issue. The Conservatives have hugely lauded individual schools and some headteachers who have followed the programme in this instance. Now, however, one of the Tories’ lauded headteachers in Birmingham—I will not name them here today—has been banned from teaching indefinitely because of poor standards in the school they run.
So, the system is broken and fragmented. When there are 124 failing schools left stranded outside the system, waiting to be transferred to another chain or sponsor, something is wrong; the hon. Member for Ellesmere Port and Neston (Justin Madders) talked about this issue very articulately. Indeed, there are authorities that are willing to participate but they have been cut out of the system, including authorities with some great expertise—not just Labour authorities, but Conservative-controlled authorities, too. That does not chime with what lots of Conservative councillors say should be the policy up and down the country.
The right hon. Member for Chelsea and Fulham talked about faith. What would happen if it was not for the Church of England, which is a broker to so many thousands of schools, especially in rural areas? It is a different situation for those of us who represent cities. We have no trouble in cities in finding academy sponsors, but in rural and suburban areas schools have trouble in that respect.
As I have said, we have struggled to find a partner for one school in the borough. I extend to my hon. Friend my invitation to the Minister to come to Stockton, because that is an authority where academies and the local authority work very closely together, which can only be to pupils’ benefit.
If my hon. Friend is inviting me to Stockton, I would be delighted to come to the north-east. The reality is that most academies worth their salt co-operate with their local or sub-regional authorities, because they want to co-operate. In the 1960s, 1970s and 1980s, parents chose not to send their children to some schools in London because of some of the horrendous things that were going on. It was not market competition that changed that; it was co-operation through the London Challenge. The Labour Government put money into failing schools, bringing the best pedagogy and the best teachers together through a co-operative system, and raising standards so that 50% of all children in London who are on the pupil premium now get at least five good GCSEs. That is what we did in London. If a line is drawn through the north of England from the Humber estuary to the Mersey estuary, through my constituency and those of my hon. Friends the Members for Ellesmere Port and Neston (Justin Madders) and for Stockton North (Alex Cunningham), that number drops to about 34%. We know what works: it was being rolled out across the country in 2010, and then austerity put an end to it.
I was making a point about the Church of England. The right hon. Member for Chelsea and Fulham talked about whether we have faith—the substance of things hoped for over the evidence of things seen. That is certainly Government education policy as it currently stands. I am not of the view that academies are bad, that free schools are bad or that we need to sweep a broom through the entire system: Labour’s reform proposals will not mean a single school closing, and will not mean any schools that are currently in the pipeline being cancelled. However, for far too long, parents and local communities have been shut out of decisions affecting the schools in their area. The Minister needs to give power back to communities, so that our schools are run by the people who know them best—parents, teachers and those local communities.
The hon. Gentleman has given himself an opportunity to clarify his policy proposals. It sounds like the schools will carry on, but they will no longer be free schools; they will be wholly under local authority control. Can he confirm that—yes or no?
No, they will not be wholly under local authority control. Local and sub-regional authorities will have a say in our schools. They already have a say on spatial planning—that is, where places are needed. Local authorities work best where they co-operate with schools, and that will happen again. Local authorities, though, should be given the power to take on schools when no other sponsor can be found. What is the ideological obsession with not allowing that to happen? As I have said, there are currently 124 unbrokered schools, containing 700,000 children. Giving that power to local authorities would ensure that no school is left without the support of a sponsor to deliver school improvement services and provide it with a network of schools. How many schools are currently awaiting a sponsor, and of those, what is the longest time a school has had to wait to get a new sponsor in place?
As my hon. Friend the Member for Ellesmere Port and Neston said, as did I when I intervened on the right hon. Member for Chelsea and Fulham, the Education Policy Institute—whose executive chairman was formerly a Minister in the coalition Government—has confirmed yet again that there is
“little difference in the performance of schools in academy chains and local authorities.”
There is no evidence of that difference. The evidence that the right hon. Gentleman cited was that there are more pupils in our school system. That is what the Government have been getting away with when trying to explain that standards have gone up—standards in schools that have not been inspected by Ofsted for over a decade. We also know that Ofsted’s only data measures affluence and deprivation, rather than the quality of teaching and learning. What matters is that schools are able to connect with a group of schools that have high performance, which is what the London Challenge did. As there is no evidence that converting a school to an academy will improve outcomes for pupils, will the Minister commit to ending the policy of automatic conversions for schools that receive Ofsted ratings of “inadequate”? It does not happen the other way around.
It is not just sponsorship that is a challenge for our academies and schools. When 91% of schools are facing real-terms cuts to their budgets, we cannot allow to go unchallenged a system that permits the education of children to become a vehicle for private profit; allows the rewarding of huge executive salaries—an £850,000 payoff in one case, as my hon. Friend the Member for Ellesmere Port and Neston said—and has resulted in mounting scandals and evidence of financial mismanagement. As I stated at the beginning of my speech, one Google search produced that evidence. There has been scandal on top of scandal, and yet the response from the Government Benches has been to do nothing. If the Minister is serious about financial transparency about spending in academies and free schools, will he agree to ban any related party transaction where a profit is being made, regardless of the kind of school involved in that agreement? Furthermore, when will the Minister take much-needed and called-for action and open an independent investigation into the regulation of academies?
Alongside concerns about academy chains siphoning off funding for the school system, there are also concerns about the actual number of academy schools that are in financial deficit. Currently, the Department for Education data looks at the financial status of overall academy trusts, rather than individual schools within those trusts. That means that if an individual school is in deficit but the trust to which it belongs is in surplus, the individual school is also deemed to be in surplus, in effect masking the real number of schools in deficit. Will the Minister provide clarity on the actual number of academy schools that are in financial deficit? If the Minister does not have that figure, will he outline what steps he is taking to ensure that the Department has a true understanding of the financial stability of all schools? Will he also outline what the implication of that lack of financial clarity in academy schools is for the implementation of the national funding formula?
We have academies without sponsors, academies siphoning off funding, and academies in financial deficit. Surely, there cannot be any further problems with our academy and free school system. Unfortunately, there are: we are in the unbelievable situation that in some areas of the country, this Government are allowing the over-supply of school places while in others there is an under-supply. The 1 million school places much lauded by the right hon. Member for Chelsea and Fulham are, I am afraid, more smoke and mirrors from this Government. Recent Local Government Association analysis of Government figures shows that by 2023-24, 71 English councils—52%—may not be able to meet the need for 134,000 secondary school places.
Surely, by that token, the hon. Gentleman will condemn Hammersmith and Fulham Council because it is absolutely bottom of that table when it comes to the projected deficit of secondary school places.
Councils should have good spatial planning about their school places. I do not have the evidence about that. The right hon. Gentleman comes from—which local authority?
Kensington and Chelsea.
We in the Opposition will have no lectures about how Kensington and Chelsea Council has comported itself over the past year or two. Two major incidents happened in this country last year: one was the Grenfell Tower fire, and the other was the Manchester Arena bomb at the Ariana Grande concert. Look at how those two authorities responded to those two major tragic incidents: one was condemned, one was praised.
Councils are facing an emergency in secondary school places, with the number of pupils growing at a faster rate than places are becoming available, yet those best placed to solve this crisis—the councils themselves—have been shut out of the system, with no powers to open schools, even though they are having to deal with the fall-out. That has resulted in the perverse situation of academies and free schools opening in areas with little or no demand for places. I remember the school that opened in Bermondsey, costing £2 million, even though the council begged it not to build a school there. It attracted 60 pupils over two years before it shut. We could have sent those children to Eton for half the price.
The reality is that our current school system is broken. It has been fragmented beyond repair. In parts, it is unfair and unaccountable and not being led by the needs of local people. In the debate, we have exposed a system that allows schools to be left in limbo without support, that lacks financial transparency and accountability, and that does not respond to or reflect the needs of local communities in most places. While those on the Government Benches appear to have no plan in place to address the challenges, Labour has a clear vision with a national education service at its heart. It would create a future system where all schools have a vested interest in the local community and not private corporations.
It is a pleasure to serve under your chairmanship, Mr Davies. My career has come to a point where I am now serving under people who I entered Parliament with in 1997, such is the level of seniority that they have reached.
About time too.
Indeed. I congratulate my right hon. Friend the Member for Chelsea and Fulham (Greg Hands) on securing the debate and on his passion and commitment to ensuring that pupils in his constituency fulfil their potential through high-quality schools and education. Thirteen academies and free schools have opened in Chelsea and Fulham since 2010, and I congratulate the teachers, headteachers and all the staff who have dedicated their time to ensuring their success. That includes those who have been involved in establishing Fulham Boys School, of which my right hon. Friend is a patron.
My right hon. Friend talked about a number of free schools. He mentioned Kensington Aldridge Academy, where the excellent headteacher, David Benson, has pushed up academic standards and stewarded it and its pupils through the tragedy of Grenfell Tower. That included a year in temporary accommodation for some pupils and a successful return. My right hon. Friend also mentioned West London Free School, where the headteacher, Clare Wagner, is doing an excellent job with very high academic standards. Watching this debate is Mark Lehain, who established Bedford Free School and was one of the first pioneering headteachers. It has been a hugely successful programme and my right hon. Friend is right to point out its successes.
The hon. Member for Wythenshawe and Sale East (Mike Kane) needs to be a bit more rigorous in his research than simply clicking through Google. For example, school academies’ accumulated surpluses amount to something like £4 billion. Excluding fixed assets and pension liabilities, the sector’s net assets have increased by £0.2 billion, from £2.6 billion in 2016 to £2.8 billion in 2017. He also referred to accountability. The whole essence of the free schools and academies programme is based on evidence from the OECD that shows that high- performing education systems around the world have two things in common: professional autonomy, combined with very strong accountability. The accountability system for our academies is stronger than it has ever been.
The hon. Member for Wythenshawe and Sale East also raised specific issues about related party transactions, and I want to address that. We have changed those arrangements so that from April next year those transactions will be transparent and receive more oversight. Academy trusts will be required to declare all related party transactions to the Education and Skills Funding Agency in advance and seek its approval for those that exceed £20,000 either individually or cumulatively. He has said in other debates in the Commons that there have been more than 100 closures of free schools. Again, I am afraid that his facts are wrong. As of 1 November this year, 13 free schools have closed since the beginning of the programme. In addition, seven new university technical colleges and 21 studio schools have closed. In total, that amounts to 41 free schools, UTCs and studio schools closing since the programme began, not the number he cites.
Does the Minister not include the collapse of, say, the Wakefield City Academies Trust, which had 23 schools? That is another trust that collapsed.
Those schools have not closed; they have been re-brokered very successfully to others. The essence of the free schools and academies programme is that we do not allow schools to languish in special measures year after year, which in essence is what was happening when those schools were under local authority control. We take very swift action where schools underperform, and we will not change the law that requires schools to become academies once they go into special measures, because that is how we get improvement. I will come on to some of the examples of how that works in due course.
Every child in this country, regardless of where they live or their background, should have the opportunity to benefit from the very best education. Free schools and academies have shown that professional autonomy in the hands of able headteachers and teachers can deliver a world-class education. For example, Dixons Trinity Academy, a free school in Bradford, achieved extraordinary results in 2017. Its first set of GCSEs placed it among the top schools in England for the progress achieved by its pupils. Strikingly, the progress score for pupils from disadvantaged backgrounds was higher than that for the whole school, including more affluent peers. That school and many others show that socioeconomic background should not and need not be a barrier to academic success.
Leading multi-academy trusts, often led by inspirational headteachers, demonstrate that excellence need not be restricted to isolated schools. Thanks to a forensic approach to curriculum design and the implementation of evidence-based approaches to managing behaviour, the Inspiration Trust in Norfolk and the Harris Federation in London—two of the best performing multi-academy trusts—have conclusively demonstrated that all pupils can achieve whether they live in coastal Norfolk or inner-city London.
It is good to hear the Minister continue to celebrate the success of our schools, but I still wonder about those that are not quite so successful and the support services they require. In the past week Ofsted has delivered a damning indictment of the education of those with special educational needs, describing the service as “disjointed and inconsistent”. The Guardian reported that the annual report of Amanda Spielman
“drew attention to the plight of pupils with SEND, warning that diagnoses were taking too long, were often inaccurate, and mental health needs were not supported sufficiently.”
Surely those are things that Ministers should be attending to, rather than just celebrating the successes.
We are attending to all those issues. As a Government, we take mental health issues extremely seriously. That is why earlier this year we published the Green Paper on young people’s mental health, which will transform the quality of mental health support at every level in our school system across the country. The hon. Gentleman is right to raise the issue of high needs funding, which we take very seriously. High needs funding has increased from £5 billion in 2013 to £6 billion this year, but we are aware of increasing cost pressures on the high needs budget, and we are aware of the causes. We have listened carefully to his lobbying today, and to that of other colleagues and schools that have raised those issues. We take those concerns extremely seriously.
The whole essence of the free schools and academies programme is to empower teachers and headteachers and to promote the importance of innovation and evidence. Power is wrestled away from the old authorities. Ideas are weighed and, if they are found wanting, can be discarded. There has been a resurgence—a renaissance—of intellectual thought and debate about pedagogy and the curriculum that used to be vested only within the secret garden of the universities. Now it is debated rigorously by thousands of teachers across the country.
Free schools have challenged the status quo and initiated wider improvement, injecting fresh approaches and drawing in talent and expertise from different groups. There are now 442 open free schools, which will provide more than 250,000 school places when at full capacity. We are working with groups to establish a further 265 free schools. In answer to Alun Ebenezer, the headteacher who runs an excellent school in my right hon. Friend’s constituency, the free school programme is thriving.
Thanks to powers granted by the Government and the expansion of the academies and free schools programmes, teachers and headteachers now enjoy far greater control over the destiny of their school. Decision making has been truly localised and professionalised. These extraordinary schools are changing what is thought to be possible and raising expectations across the country. They are an example to any school seeking to improve. Whether we look at Reach Academy in Feltham, Dixons Academy in Bradford or Harris Academy Battersea—all with high pupil progress scores—there are some obvious similarities.
All of the schools that I have mentioned teach a stretching, knowledge-rich curriculum. Each has a strong approach to behaviour management so that teachers can teach uninterrupted, and they all serve disadvantaged communities, demonstrating that high academic and behavioural standards are not and must not be the preserve of wealthy pupils in independent schools. Indeed, Harris Westminster, a free school that opened in 2014, which has close ties to Westminster School and draws pupils from across London, has reported that, with 40% of its pupils from a disadvantaged background, 18 pupils went to Oxbridge last year.
All around the country the Government have built the foundations of an education system through which teachers and headteachers control the levers over school improvement and parents exercise choice, shifting decision making from local education authorities and handing it to local communities and the teaching profession. With an intelligent accountability system to maintain high standards, innovative schools collaborate and compete with one another to improve teaching, the quality of their curricula and retention of staff.
Two thirds of academies are converter academies, and many have become system leaders within multi-academy trusts by helping other schools to improve. More than 550,000 pupils now study in sponsored academies that are rated good or outstanding. Those academies often replaced previously underperforming schools, so when the hon. Member for Wythenshawe and Sale East says that he wishes to disband or end the autonomy that comes with the academies and free schools programme, he is saying that he would not have enabled the 550,000 pupils who were languishing in underperforming schools to be given the opportunity to be taught in much higher performing schools, thus taking away opportunities as an enemy of promise and social mobility.
As at August 2018, 89% of converter academies were rated good or outstanding by Ofsted. Results in primary sponsored academies continue to improve. The percentage of pupils reaching the expected standard in reading, writing and maths in current sponsored academies was 42% in 2016, and in 2018 it was 57%. Academies and free schools are driving up standards all over the country. Queen’s Park Junior School in Bournemouth was placed in special measures in May 2011. In the same year only 50% of pupils achieved level 4 or above in reading, writing and maths, compared with the national average of 67%. In September 2011 Ambitions Academies Trust started working with the school, and in October 2012 Queen’s Park Academy became part of Ambitions Academies Trust as a sponsored academy. Queen’s Park Academy was judged outstanding in all areas by Ofsted in June 2014 and is now providing support for other schools in the trust. In 2017 the school’s writing and maths progress scores were both above average, at +2.3 and +1.4, and 78% of pupils achieved the expected standard in reading, writing and maths.
WISE Academies in the north-east of England has taken on nine sponsored academies since 2012. The trust is making the most of its autonomy—the autonomy that the hon. Member for Wythenshawe and Sale East wants to remove—and has reduced teacher workload through efficient lesson planning and by sharing resources. It is innovative in how it teaches, embedding maths mastery techniques from Singapore into its maths curriculum. As a result, every school that has been inspected since joining the trust has been judged to be either good or outstanding.
Free schools are among the highest performing state-funded schools in the country, with pupils at the end of key stage 4 having made more progress on average than pupils in other types of state-funded schools. In 2018 four of the top provisional Progress 8 scores for state-funded schools in England were achieved by free schools.
I thank my right hon. Friend for his excellent exposition of the success and brilliance of so many of our free schools. I do not expect him to make a policy pronouncement today, but will he take on board some of the comments I made in relation to the ESFA and the complaints I have heard from various parent groups trying to set up free schools—some successful and some unsuccessful—particularly in an area such as mine where the crucial question is always about the ability to secure the site and, in their view, the bureaucratic approach taken to site selection and delivering financing?
Yes. My right hon. Friend anticipates the point I was coming to. As he knows, the Fulham Boys School is currently in temporary accommodation and the Department is working hard to ensure that a permanent site will be ready as soon as possible. All parties are working to deliver the site as early as can be achieved, but it remains, as he knows, a complex project. I am aware of people’s concerns about the site. It is a difficult challenge to find a site, particularly in London, but we have more than 400 free schools being established. With any large projects we will find delays and problems, but they are achieved, which is why we have more than 400 successfully opened free schools.
As I was saying, in 2018 our top 10 provisional Progress 8 scores for state-funded schools in England were achieved by free schools, by people who persevered through all the problems of finding a site and getting a school opened. For example, William Perkin Church of England High School in Ealing, Dixons Trinity Academy in Bradford, Eden Girls’ School in Coventry and Tauheedul Islam Boys’ High School in Blackburn are in that top 10. The latter two were opened by Star Academies, which has grown through the free schools programme, from running a single school in the north-west to running 24 schools across the country, made up of nine academies and 15 free schools, and it has approval to open two additional free schools. Of the 10 that have had Ofsted inspections since opening or joining the trust, all have been rated outstanding. That is the kind of programme that the Labour party wants to stop happening in future, denying young people the opportunity of having an excellent education, but the approach works. The free schools and academies programme demonstrates, as I have cited, the benefits of strong trusts and strong collaboration.
Converting to an academy is a positive choice made by hundreds of schools every year, to give highly able teachers the power to make their own decisions; the breathing room to be creative and innovative; and the freedom to drive improvements, based on what they know works for their pupils. My hon. Friend the Member for Henley (John Howell) cited the example of the Europa School that converted from the independent European School into a free school. We were very pleased to authorise that new free school to teach the European baccalaureate rather than A-levels and GCSEs. Wary of the risk of being made to drink a shot of rum, the future of that qualification will depend on discussions with the European Schools system post Brexit.
We want to go further to make sure that no one is left behind. We want to extend the free schools programme to areas of the country that have not previously benefited from it.
I am grateful to the Minister for giving way on that point about extending the programme to other areas. My impression is that the vast majority of free schools tend to be opened in the more leafy areas where there is less deprivation. What evidence does he have—perhaps he could write to me—about the number of free schools opened in areas of high deprivation and how they are achieving great things?
Some 50% of free schools have been opened in areas of deprivation. There has been a determination to ensure that free schools are opened in areas of disadvantage that have been poorly served by the schools system in the past. I will be happy to respond to the hon. Gentleman’s earlier invitation to visit schools in his constituency to see at first hand how they use the programme’s autonomy and freedoms to raise standards.
Earlier this year we launched the 13th wave of free schools, targeting the areas of the country with the lowest standards and the lowest capacity to improve. Those are the places where opening a free school can have the greatest impact on improving outcomes.
The application window for wave 13 closed on 5 November. We received 124 applications from both new providers and experienced multi-academy trusts. We are assessing the proposals and will announce successful applications in the spring. We will launch the 14th wave of free schools shortly, demonstrating again to Mr Ebenezer and others that the free school programme continues to thrive, albeit with one threat on the horizon: the Labour party is committed to ending the programme.
This summer we launched a special and alternative provision free schools wave. By the deadline in October we had received 65 bids from local authorities, setting out their case for why a new special or AP free school would benefit their area. In the new year we will launch a competition to select trusts in the areas with the strongest case for a new school. We are also continuing to accept proposals for maths schools from some of our best universities, having already seen excellent results reported by both existing maths schools, Exeter Mathematics School and King’s College London Mathematics School. Those schools have exemplary A-level results in maths, physics and further maths.
I am grateful to my right hon. Friend for the support that he has given to the free schools programme. Some important points have been raised, and I welcome the opportunity to discuss a central part of our education policy and to share some examples of the excellent work in academies and free schools throughout the country. Since 2010 our education reform programme has brought new levels of autonomy and freedom for schools, with clearer and stronger accountability. There are many examples of academies, and the multi-academy trust model, bringing about rapid and effective improvement in previously underperforming schools.
Since 2010 we have been unflinching in our determination to drive up academic standards in all our schools, and to drive out underperformance in our school system. Our ambition is for every local school to be a good school, to close the attainment gap between pupils from different backgrounds, and to ensure that every pupil, regardless of their background or where they live, can fulfil their potential.
I invite Greg Hands to wind up the debate briefly.
Thank you, Mr Davies. I will try to fill the remaining eight and a half minutes.
You do not need to.
That is helpful advice—it has been a little while since I have done one of these debates. However, as the time is available, I might say a few things.
This has been an excellent debate. I am delighted that the academies and free schools programmes are thriving and making such a difference to school standards across the country. As the Opposition spokesman pointed out, I had the pleasure and privilege of going to one of the best state schools in the country: Dr Challoner’s Grammar School in Amersham. That stood me in good stead for everything that came after. I have always been a strong believer in high-quality state education, which is what the Government have delivered over the past eight and a half years, and will continue to deliver.
As I said, the very centre of this movement is my constituency, and the two boroughs that my constituency forms part of: Hammersmith and Fulham, and Kensington and Chelsea. In those boroughs, 13 new free schools and academies have opened. It is an incredible achievement to open five new secondary schools, and eight additional primary schools, in the two smallest boroughs in London.
Often such things are very difficult. I remember when West London Free School opened in 2011 or 2012—it must have been almost the first free school. I remember speaking to the then leader of the council, the excellent Stephen Greenhalgh, the then Secretary of State, my right hon. Friend the Member for Surrey Heath (Michael Gove), and the founder of the school. We talked about how we were going to make it possible, and it was quite hard, because people wishing to set up such a school face a number of obstacles. The sites can be very difficult. Most of those people are incredibly dedicated to seeing the schools delivered. I take a strong interest in how the Education and Skills Funding Agency works, and how such things might be improved. I welcome the Minister’s commitment to look at a continuing review of how that is done.
We have a crisis in our schools coming up locally, despite all the achievements. I mentioned the shortage of places in Hammersmith and Fulham. The current Labour council has sat on its hands for the past four and a half years and done nothing about it. After all the achievement in the preceding four years of the Conservative Government, combined with the Conservative council, in delivering all those new schools, nothing has been delivered in the past four years. The area will be short by 327 places. Reform has come to a shuddering halt.
My constituents will also be alarmed by what has been said by the Labour party. The Opposition spokesman today failed to repudiate what the shadow Secretary of State for Education said at the Labour party conference. She said:
“We’ll start by immediately ending the Tories’ academy and free schools programmes.”
I think the Opposition spokesman said, if I understood him correctly, that that would not mean the closure of the schools. However, they would be taken immediately back into—or put under for the first time—local authority control. That would be the abolition of free schools and academies in the way in which they currently operate, ending their autonomy. That will ring alarm bells in my constituency among so many parents whose children are currently at those schools, and among all the parent groups that come to see me to talk about establishing new schools.
There is an incredible diversity in education in my constituency. We have had amazing bilingual Anglo-French schools set up—feeders into the incredible Lycée Français Charles de Gaulle. Some new parent groups want to set up bilingual Spanish schools. I expect that at some point all these groups will come to me and say, “We are alarmed, Mr Hands, by what we hear is the policy of the Labour party—threatening the future of these schools before they have even been established.” I invite the Labour party to review and reconsider its policy, because it will be incredibly unpopular, and is incredibly unpopular in my part of London.
Some of the schools have an incredible record, and an incredibly diverse intake. Fulham Boys School, for example, is very proud of the fact that 40% of its children qualify for the pupil premium, while 15% come to it from a private school background. In a community such as mine, where there is not much in the middle, that school take the full spectrum of pupils. At Ark Burlington Danes Academy in Shepherd’s Bush, nearly half the pupils are eligible for free school meals. Often such intakes are from the more deprived parts of the two boroughs, in the north, and most of those schools do a fantastic and brilliant job.
It would be a great shame to see that future threatened by a future Government. However, of course, as we all know, there is not going to be a future Labour Government coming up. I can tell parents that they can at least rest assured on that front. Nevertheless, it is a cause of concern in my constituency, and I hope that the Labour shadow team will reconsider their ideological approach to ending the programme, and reconsider what is in the best interests of parents and pupils at those schools, and future schools to come.
Question put and agreed to.
That this House has considered the future of free schools and academies in England.
I beg to move,
That this House has considered services at Southend hospital.
It is a pleasure to serve under your chairmanship, Mr Davies. I very much welcome my hon. Friend the Minister to his new post in the Department of Health and Social Care. I was on the Select Committee on Health for 10 years, which was probably too long, but during that time—I am bragging a bit—I initiated the debate on obesity, which some people now think they are discovering for the first time. We also dealt with the smoking ban, which I never thought would work, and with passive smoking, allergies and a whole raft of other issues.
I have to say that it is a long time since I heard anything original said about the health service. I have been all around the world and all over the country looking at facilities, and I am left with the conclusion, which I know the House shares, that our national health service is the best in the world. It is the only really nationalised health service that exists. The differences between the two political parties may be a bit blurred, but if it is down to funding, good luck with that issue—the money has to come from somewhere.
I am delighted that my hon. Friend the Member for Rochford and Southend East (James Duddridge) is here to support me. My right hon. Friend the Member for Rayleigh and Wickford (Mr Francois) and my hon. Friend the Member for Castle Point (Rebecca Harris) may not be here at the moment, but I feel that they are somehow here in spirit, because the four of us use the facilities at Southend Hospital.
I must take the opportunity to praise the staff at Southend Hospital, who I know only too well are overworked and underpaid. It is a difficult political issue to deal with, but they are so dedicated and they provide an absolutely excellent service. My hon. Friend the Member for Rochford and Southend East and I, and our families, have benefited from care at the hospital. We were so privileged to be at the Hospital Heroes awards ceremony in September, which celebrated the very best of Southend’s healthcare staff and those who go the extra mile for their patients. I congratulate all the winners and nominees and thank them for their dedication, compassion and considerable expertise.
I also praise the volunteers among my Southend West constituents, who give up their time, unpaid, to support the hospital’s work and help others. Those women and men are there day in, day out and week in, week out, giving a little extra help and support to people going into hospital, many of whom are somewhat concerned and stressed about what lies ahead. From befrienders to hospital gardeners to the library service, they should be commended for their invaluable contribution on behalf of patients across Southend.
Southend Hospital and healthcare services throughout Southend are at a crossroads. It could be argued that their future is uncertain. The Minister will be only too well aware of the mid and south Essex sustainability and transformation partnership plan for the reconfiguration of specialist services across hospitals in Essex. I must tell him that I will not support any changes to those services unless they are led by clinicians, not by politicians. It is up to the clinicians to put their heads above the parapet and argue the case for change.
The plans have been referred to the Secretary of State for review. I will not go into the whys and wherefores of what happened, but we have a Conservative-controlled local authority in Southend and I think the Conservatives were particularly concerned about changes to the stroke service, which is under the excellent leadership of Dr Guyler. I am not sure why all the plans have had to be reviewed. If the Minister cannot answer now, perhaps he could write to me to confirm whether there is a possibility, however vague, that we might lose funding as a result of the delay or that the funding we were promised might arrive less quickly. [Interruption.] Does he wish to intervene?
No, no—I was just listening very carefully to my hon. Friend’s speech.
Right. Well, there seem to be rumours that, as a result of the plans being referred, there is a real danger that the extra money that we were promised might not materialise or that there could be repercussions for the services at Southend Hospital. I appreciate that the Minister might not be able to comment on that issue at the moment, but in this short debate I hope to set out some of my constituents’ concerns, and my own, about how best to support the world-class services at Southend Hospital and ensure that everyone in all four constituencies receives the best possible care.
Southend has always been absolutely at the top of cancer services generally. I will not delay the House by listing all the organisations that have had a hand in delivering cancer services there, but Southend has always been very highly regarded. From its gynaecology training coming top in the UK and its trauma and orthopaedic team being named training hospital of the year to its world-leading practice standards for cancer care, Southend Hospital has lots to celebrate about its services and patient care. The radiotherapy department deserves particular mention in the light of its recent CHKS accreditation for its pioneering radiation treatment, as well as its high ratings from the Care Quality Commission. The centre has led the way in utilising highly focused and concentrated radiation treatment on tumours that reduces harm to surrounding organs. It has treated more than 1,700 patients this year and is a great example of the importance of investment in driving world-leading research and developing innovative treatments.
This is where the sting comes in. NHS figures show that 36% of Southend cancer patients wait eight weeks for treatment after their initial GP referral. The Minister may have an answer to this, but more than a third seems somewhat high—more than twice the national NHS target. It is vital that more be done to speed up referrals and avoid such unacceptable delays in treatment, which can cause so much worry for patients. With world-class care on their doorstep, our constituents deserve nothing less than fast access to the treatments that they most need. I would welcome any comments from the Minister about speeding up the process.
Southend Hospital is currently trialling a mobile stroke ambulance unit—a pioneering and innovative treatment service that allows specialists to travel directly to patients and treat them en route to the hospital. Data is still being analysed, but clinicians have reported great successes, with specialists being able to deliver life-saving thrombolysis treatment just 16 minutes after the patient alert. That is absolutely incredible. We all know that the sooner a stroke is treated, the more likely a good outcome. Treatment in the first few minutes can make all the difference, so getting patients to a specialist as quickly as possible is imperative. Not only have patient outcomes been improved, but the unit has shown great potential to alleviate pressure on A&E departments. Some 88% of patients in the trial were admitted directly to a specialist stroke unit, freeing up resources across the NHS.
The trial is due to end on 19 December, but so far there has been no confirmation that this pioneering service, which has been funded entirely by charitable donations, will continue. I believe that greater support is needed to ensure that the hospital can retain the mobile unit. More than 100,000 strokes occur each year in the UK, so it is essential for the NHS to use such innovative services to ensure that we can deliver the best care to patients in the shortest time. I know that my right hon. Friend the Member for Rayleigh and Wickford is particularly interested in stroke care and in how it is delivered at Southend Hospital. I encourage the Minister to review the successes of the trial at Southend and to look into how such life-saving services can be offered to patients across the United Kingdom.
The critical issue of time in stroke care is a great concern for Southend. I appreciate that the Minister will be unable to comment on the STP’s proposed centralisation of stroke services in the constituency that I once represented—Basildon. However, maintaining the established stroke service infrastructure and keeping Southend as a centre of excellence is very important. Whatever the outcomes of reconfiguration, my constituents do not want to see the downgrading of the world-class stroke services in Southend, and patients put at risk.
There is a big issue about transport services, which I know is of great concern to my hon. Friends the Members for Rochford and Southend East and for Castle Point, and my right hon. Friend the Member for Rayleigh and Wickford. While Southend Hospital is leading the way in many areas of care, transfer to specialist services is obviously important. Patients are currently transported to acute services across Essex through the “treat and transfer” model. Although that is working in ensuring that patients get access to the specialist treatment they need, a big concern for our constituents is the impact that an expansion to the model could have. Inter-hospital transfers affect not only the patient, but their carers or families. The costs incurred and difficulties experienced by patients and visitors travelling across services need to be taken into careful consideration. It is essential that the local transport services, whether public transport or community transport organisations, can provide the right support to patients and their families.
I endorse everything that my hon. Friend has said about the mobile stroke unit. I encourage the Minister to look at the great success that it has been. As my hon. Friend knows, I have particularly focused on the transport issues. The East of England Ambulance Service, which would be the logical service to provide that transfer, is under great pressure as it is. Does my hon. Friend accept that if the whole of the STP is to stand up and be coherent, we must have clearer answers about exactly how the transfer of critically ill patients from one hospital to another would work in practice?
As ever, my right hon. Friend is absolutely right; he is intuitive. We need greater clarity on this matter, and our constituents want reassurance and certainty.
I have outlined some of the successes of Southend Hospital, as well as the areas in which greater support and investment are needed. The hospital serves just under 340,000 people and, although challenged by the pressures on the system, has managed to lead the way in world-class care. Southend is becoming a hub of medical education and training, with both the gynaecology and trauma teams recognised as some of the best in the country. Pioneering cancer and stroke care at the hospital is at the forefront of treatment innovation, but those excellent services cannot continue at such a standard without investment and support. I hope that the Minister will closely consider our constituents’ concerns, and I look forward to hearing from him what more the Government can do to ensure that Southend Hospital retains its world-class services. I would also be grateful for an update in due course from the Secretary of State, perhaps by letter, on the STP referral when that decision has been made. I look forward to working with the Department proactively on that issue.
Order. I assume, Sir David, that you are happy for James Duddridge to speak in the debate.
I call James Duddridge.
Apologies for not giving notice in the normal way, Mr Davies; my hon. Friend the Member for Southend West (Sir David Amess) did give me permission to speak in his debate.
The short version of my speech is “Thank you”—not to my hon. Friend, or to yourself, Mr Davies, but to the people who work at Southend Hospital. It is impossible to thank all 4,500 personally. I would like to say that I went to Southend Hospital last night as an assiduous Member of Parliament, purely with the intention of thanking them; sadly, I went to see a family member in A&E, who is thankfully now out. Quite often, constituents see politicians as somewhat remote, but most of the time I have spent at Southend Hospital has been either as a patient myself—I spent three months in hospital only a few years back—or visiting one of my family members.
We are fortunate to have Southend Hospital so close by, but I am unfortunate enough to have to visit it in a non-professional capacity far too frequently. The people at Southend Hospital provided fantastic care for Jack Thompson, my father-in-law, in his final days. As a Member of Parliament, I quite often find myself visiting constituents. There is such compassion and care during those final hours, as there is care and compassion in every ward, whether that is for the newborns in Neptune ward or for people with dementia in Wilson ward.
My hon. Friend mentioned the hospital’s stars awards, which brought him, me and our right hon. Friend the Member for Rayleigh and Wickford (Mr Francois) together as local MPs. It is amazing to see the depth of those individuals’ compassion and commitment to their roles. As an individual, I have seen that small things can mean the difference between an average person and a fantastic, exceptional person. It might be a cup of tea, or explaining for the third time something that is bleeding obvious, but which, to a parent who is so stressed by what is happening, is hard to take in. Or it might be nurses who put themselves in really troubling jobs—for example, dealing with parents of newborn babies who have passed away, and having to do that day in, day out. The difference that those people can make is absolutely amazing, and one person won a stars award for dealing with those types of situation. That takes an incredibly special person. I thank all those individuals.
I also thank Clare Panniker, who is leading the three hospitals tremendously well. The transformation programme is fascinating and fantastic, at a time when we have more money going into our three local hospitals, as well as more nurses and more doctors. However, there still needs to be more change.
In all candour, I was disappointed with the Southend local authority for referring the whole of the transformation programme, because, like my hon. Friend the Member for Southend West, I trust clinicians. We did have issues around the stroke unit, but they were being dealt with by Paul Guyler, the lead clinician. There were and still are issues on transport, but the idea that the whole transformation programme is wrong is incorrect. I know that my hon. Friend the Member for Chelmsford (Vicky Ford) is effervescing with rage at Southend council. I do not want to be overly dramatic, but she felt that lives had been lost in Chelmsford because we had not got on with the capital expenditure and the specialisation across the three hospitals that gives our families and our constituents better care. Let us push back on some of the issues, but let us also get on with it, and further improve what is a fantastic local hospital.
It is a pleasure to serve under your chairmanship, Mr Davies, and to take part in this debate. I congratulate my hon. Friend the Member for Southend West (Sir David Amess) and pay tribute to my hon. Friend the Member for Rochford and Southend East (James Duddridge) and my right hon. Friend the Member for Rayleigh and Wickford (Mr Francois) for their contributions. They have all raised points that I wanted to come to and I hope I can respond to them in my reply, because the subject is very important. As constituency MPs, whether a Minister or no, we all recognise the crucial importance of local healthcare systems and what they deliver for our constituents.
My hon. Friend the Member for Southend West is well known as a passionate advocate for his constituents, and has been for many years, but he was also right to point to his distinguished service on the then Health Committee, a Committee that has always done so much to drive thought. He mentioned a number of issues and said he did not want to blow his own trumpet, but some of the issues that he raised are now mainstream issues, and that is hugely important.
My hon. Friend was right when he said in his opening remarks that he thought the NHS was the best health service in the world. I completely agree; that is right. He is also right, of course, as was my hon. Friend the Member for Rochford and Southend East, to say that it is the staff who drive the hospitals and the service for our constituents. As my hon. Friends did, I extend my thanks and those of everybody to those staff, and to everybody who works in the health service, whatever they do. They all contribute in a significant way. They also spoke of the role of volunteers, which was again right. I see the work that volunteers do in my local hospitals. People sometimes forget how that work contributes to the whole experience; it makes life easier for people at an extraordinarily stressful time. I also note with interest the comments made about the stars awards.
I had the chance to speak to Clare Panniker yesterday. She is clearly an impressive professional, driving change for the right reason, which is listening to clinicians and ensuring the best outcome for patients.
I wanted to make those remarks right at the start, and I will say a few words on the three issues that my hon. Friends have talked about—stroke, cancer, and transport and access. The national picture on stroke services is that there is a need to improve the quality of service provision and outcomes for all patients. It is well recognised that stroke is the fourth-biggest killer in the United Kingdom and a leading cause of disability. Although the 10-year national stroke strategy came to an end last year, a programme board was established in March 2018 to oversee the development of a new stroke plan. The fact that one has continued does not mean in any sense that the prioritisation has changed; indeed, that board is now chaired by NHS England’s medical director, Steve Powis, and by the chief executive of the Stroke Association.
To add to what my hon. Friend the Member for Southend West said about specific local issues, we should also mention the importance of the national context. I absolutely understand some of the issues that he raised, and he is right to say that changes, and the rationale for changes, should be clinician-led rather than politician-led. As my hon. Friend the Member for Rochford and Southend East acknowledged, that is actually what is happening with the transformation programme, which is why I understand the frustration of my hon. Friends. They will understand that it is impossible for me to comment on that in detail today due to the referral, but I give the guarantee that when the process has ended and the decisions have been made, all my hon. Friends—not only the three who are present, but others who are concerned—will of course be given sight of that recommendation and the chance to comment on it.
My hon. Friend the Member for Southend West has explained that he has a particular interest in transport. For the sake of clarity, it is important that I set out what has been agreed by the clinical commissioning group and what some of the alternative paths are, in response to the point made by my right hon. Friend the Member for Rayleigh and Wickford. On the transfer of patients, we all know that the CCGs have approved a treat-and-transfer model, whereby a small number of patients will receive initial treatment at their local A&E before being transferred to another hospital. Decisions on patient transfer will be made solely as clinical decisions and discussed with patients prior to transfer. Modelling by the CCG and clinicians suggests that, on average, 15 patients a day might be transferred from their A&E to a different site for clinical reasons and due to the proposed changes. It is a vital part of a joined-up service, especially where specialisation increases—the need for this may or may not increase. Like my right hon. Friend the Member for Rayleigh and Wickford, I encourage hon. Members to continue to press this matter with the STP once it is resolved, because I think it is vital.
The critical thing we need to know is who will provide the service. The obvious answer is the East of England Ambulance Service, but it faces serious resource and capacity challenges. It is difficult for us to support this plan wholeheartedly until we are given definitive answers. Who will provide the service, and how will it work in practice?
There are three answers to that: critical cases, non-critical cases and transport for patients’ families and carers. Let me start with non-emergency transfers, which at the moment are provided through patient transfer services, as my right hon. Friend knows. They are available in Southend when medical conditions are such that patients require the skills or support of staff on or after the journey. He is absolutely right to say that critical cases, or those that do not fit into the first category, are provided by the East of England Ambulance Service. He will not be surprised to learn that, even in my short time as Minister, I have already been made aware of some of the issues with that service. Nor will he be surprised to hear that the Department is working with the relevant authorities to ensure that standards and resources are made available to bring the service up to the expected standard, and that ambulance response standards are met.
On patients’ families and carers, I understand—my hon. Friends will know better than I do—that there is a joint CCG/local council transport working group. It has been exploring a number of options to make transport easier, including, I understand, the creation of a shuttle service between hospitals in Southend, Basildon and Broomfield. Key to that endeavour will be the volunteers who we spoke about earlier and the expansion of volunteering.
My hon. Friend the Member for Southend West spoke a little about cancer services, and he will understand that the proposed new model maintains Southend as the specialist cancer centre. He was right to make the point that it meets the two-week standard for GP referrals, and that more than 1,700 patients have been treated this year, but he is equally right to say that the length of waiting times is indeed high. I reassure him that we are absolutely committed, as a Government, to increasing the levels of early diagnosis, and that a comprehensive plan is in place to drive down those waiting times. He is right to have that concern, which I share.
My hon. Friend the Member for Southend West talked about the new model of stroke provision. He will know that the idea is for people to be seen initially at their local A&E, where thrombolysis treatment will be provided should it be required, and then there will be a transfer to a specialist stroke unit at Basildon, should that be necessary. That will be a clinician-led decision and based on the confirmation of stroke. That hyper-acute stroke unit would give patients, in that critical first 72-hour period, the intensive nursing and therapy support they need to have the best chance of recovery and the best outcomes. Basildon has been selected for the specialist centre because its stroke services are co-located with the vascular, interventional radiology and cardiology teams; it therefore makes sense to have the service there.
My hon. Friend the Member for Southend West raised the issue of the mobile stroke unit, and he is right to say that the trial is ongoing and not yet complete. I join him in thinking that this is really quite an exciting project. I look forward to seeing the results of the trial and the evaluation. We know that the project is separate from the STP, and therefore any decision to locate a permanent mobile stroke unit at Southend will be made at the local level, but I think the national implications of this trial will be exciting.
My hon. Friend the Member for Southend West said that he wanted to hear about future funding and whether there would be any delay. Any funding of course depends on local plans and on clinical support. I was going to read out a quote from Dr Paul Guyler just to reinforce the point that everything that is being done in this area is being led by clinicians, but as my hon. Friend has already made the point that Dr Guyler supports these things—his support is one of the drivers for the change—I will not delay us by reading that aloud. When a decision is made on a clinical basis, the Department and its arm’s length bodies are committed to ensuring that there is the investment available to deliver what is necessary and to make a real difference, but clearly that would depend on the plans and the outcome of the reconfiguration. My hon. Friend knows that I cannot say much about that now; none the less, I give him the commitment that I will speak to officials about this after the debate. If there is more to add at this stage, I will write to him and to my hon. Friends.
In the 30 seconds I have left, I want to say that this has been a short but fascinating debate. It shows that my hon. Friends recognise the contribution of professionals and what Southend Hospital does for their constituents. I appreciate that the potential changes to the local health services inspire impassioned debate—it is right that this is led by clinicians, and that the Government give it proper consideration.
Motion lapsed (Standing Order No. 10(6)).
[Mrs Anne Main in the Chair]
I beg to move,
That this House has considered reforming the regulation of shisha lounges.
It is a pleasure to serve under your chairmanship, Mrs Main. I am delighted to have secured this debate. In a week in which Ministers have been held in contempt of Parliament for the first time ever, and we have had ongoing and various crises related to the handling of Brexit, talking about the regulation of shisha premises might seem a little niche. I have found myself educating many colleagues about what shisha is and about the problems relating to shisha premises in the affected communities.
Central to this debate is how we as citizens navigate community life together, balancing the social and entertainment needs of some against the needs of residents, and whether we can take effective action when things go wrong. Residents affected by issues relating to shisha lounges, such as those in my constituency and other areas including Westminster, Brent, Ealing, Preston, Manchester and many of our other core cities, can attest to the fact that, when things go wrong, they face the misery of noise nuisance, crime, antisocial behaviour and everything that goes with that. For them, this is definitely not a niche issue. It affects communities profoundly.
I should explain what shisha is and what form these premises take. Shisha, which is also known as a water pipe, hubble-bubble smoking or a hookah, is a way of smoking tobacco through a bowl and a pipe or a tube. The tobacco is often mixed with other flavours such as mint, coconut or pineapple—I have seen every variety going. The tobacco is burned, and then the vapour or smoke passes through a water basin before inhalation. It is a social activity; people do it in groups. It is not dissimilar to going out for a night at the cinema or any other kind of entertainment activity. People go out for a night of shisha smoking.
I am not exactly sure where shisha smoking originated, but it is common in parts of the middle east, Africa and Asia. In recent years it has become much more popular in the UK. I have been aware of shisha places in Birmingham for some years, but there has been a proliferation of establishments there over the past five years. It is a growing trend in our major cities. I have never smoked shisha or any kind of cigarette, and I cannot personally see the attraction of it, but many of my constituents, friends and acquaintances enjoy it as a night out and regularly go to a shisha lounge, bar or café.
These establishments are much more varied than might be assumed. One of the stereotypical assumptions about what shisha premises look like is that they are typically some sort of middle eastern café with a middle eastern food menu and décor that is indicative of some sort of middle eastern origin—almost tent-like. Certainly, some establishments fit that stereotype, but there are also many huge venues—swish, swanky establishments that are often spread out over a number of floors in buildings that may previously have been warehouses. They look and feel like any other major nightclub or similar attraction in a major city.
In my constituency and across Birmingham I have seen that the clientele of those establishments is much more cosmopolitan than might be assumed. It might be thought that this activity is primarily enjoyed by people from black and minority ethnic communities, but it is much wider. That is partly because some of those establishments do not sell alcohol—some do, but some do not—and make a virtue of offering an alcohol-free space for people who wish to enjoy it. That fills a gap in the market for young Muslims, in particular, who want to go out and have a good time just like anybody else, but want to be in an alcohol-free space. There has also been an increase in the number of 16 to 24-year-olds across all communities and social classes who do not drink alcohol. Entrepreneurial businessmen and women are trying to fill the demand in the market by opening up these types of venues, which do not serve alcohol but provide a night-time entertainment offer for different sections of the community.
Many shisha establishments serve food—food is a key part of their offer. Many double up as dessert places—another type of venue that has proliferated—where people can get milkshakes that contain three days’-worth of their recommended calorie intake and smoke shisha at the same time. Some are modest cafés and others are much more like nightclubs. Across Birmingham the number of establishments of various different forms has grown over the past few years.
As a Member of Parliament, a resident and a citizen of my city, I was aware that these venues were growing in popularity, but I had not come across the issues that affect local people when one opens up until I did a coffee morning in my constituency in the summer of 2016. I expected it to be a normal coffee morning, when the issues we would expect were raised, but every resident who came wanted to talk about the problems they were facing as a result of a shisha lounge opening directly opposite their small housing estate. It related to a shisha lounge called Arabian Nites, which has featured much in Birmingham news over the past few months.
The stories that my residents shared with me were horrendous. They said that a nightclub had opened directly opposite their houses, and they were powerless to do anything to stop the issues they faced as a result. Some residents had been attacked, and some had woken up to find patrons of the establishment urinating in their front gardens—in one case, as they were getting ready to take their children to school in the morning. The noise nuisance was so bad that they could never open their windows at night—not even in the peak heat of summer—and even with their windows shut the noise disturbance was pretty high. Parking became a total nightmare, and there was partying till the early hours.
People told me that their community had been ruined. One of the saddest things is that in that area there are lots of council housing tenants who have lived there for decades and are the absolute backbone of the local community. They have been there through thick and thin and have seen lots of changes to their community, but they love their community and the place where they live.
I congratulate my hon. Friend on securing the debate. Does she agree that public awareness campaigns, such as one that Manchester City Council launched recently, are crucial to raise awareness of the damaging health impacts of smoking shisha? In addition, we need effective licensing and enforcement to crack down on businesses that flout regulations on the sale of shisha. Just a week ago, Manchester Council seized 95 shisha pipes from one property—
Order. There is plenty of opportunity to make speeches, but interventions must be short. May I ask you to bring that remark to a close?
I will. Thank you, Mrs Main. It is more than 10 years since the smoking ban came into effect, yet businesses continue to flout the law—
I am grateful to my hon. Friend the Member for Manchester, Gorton (Afzal Khan) for his intervention. I know that a lot of work has been done in Manchester. I will come on to some of the public health issues. He is right to raise public health concerns. There are, of course, public health duties on local authorities, and the public health risks relating to shisha are not well understood and publicised. He is absolutely right that much more awareness is needed. I congratulate Manchester for the good work it has done in this area.
The common life of those residents and the community they created, which they love and have thrived in for all these years, was being ruined. Some of those stalwart residents—the absolute backbone of the community—told me that they wanted to leave and were desperate to move out. In fact, they most wanted my help with council housing transfers. I thought that was one of the saddest things, because those people are the lifeblood of the area. If they move out, we will lose something much more profound in the community. It was all because they simply could not tolerate the daily misery they were facing because of the shisha venue.
As people became more vocal with their complaints—I took up the issues and worked with the council and the police, who were doing their best to manage the fallout from the venue opening near my residents, and there was more media coverage in the Birmingham Post and the Birmingham Mail—residents became worried about reprisals from patrons of the venue. Suddenly, it became much more of a hot topic. Things then took a more serious and frightening turn, because gun violence and other serious crime was taking place. People were up in arms but also terrified. I was shocked that almost overnight a community could be ruined by a shisha place opening.
As the local Member of Parliament, I initially treated this as a policing matter. It is interesting that other parliamentarians and council leaders have tended to raise it with Home Office Ministers as a policing issue. I, too, talked to the police. We thought about having more policing patrols and possible interventions, but eventually I had to conclude that the law itself makes things complicated in this area. My thought was, “Just take away the shisha licence,” because that is the business model on which the premises are based—take it away and they will not have a business and will soon move on—but of course there is no licence for shisha.
In the case of Arabian Nites, it took a couple of serious incidents involving gun discharges—one discharge ricocheted and hit a passer-by—before the police could apply for a closure order under antisocial behaviour rules. Such closure orders are temporary and the one for Arabian Nites was for only three months. The venue has not reopened, but it is free to do so once it has met the new conditions.
My hon. Friend is making a powerful speech. Does she agree that under the Licensing Act 2003 it should not be so difficult to get premises closed down for antisocial behaviour and other breaches of the legislation?
My hon. Friend, the shadow Minister, is absolutely right: the process is too difficult and onerous. I have a copy of the documentation put together at huge cost in time and resource by the police in support of the application for a closure order. It is more than 100 pages long—I was trying to print it before coming to the Chamber so that I could show it to everyone, but my printer broke—given the amount of work and number of witness statements required of police officers.
In the first case against Arabian Nites, the police did not get the closure order and had to apply a second time. Meanwhile, my residents who live with that place directly opposite their homes are terrified of gun violence, of stepping outside late at night and even of taking their kids to the school around the corner. The regime is too onerous, and to rely simply on existing police powers is not good enough. I have nothing but praise, by the way, for the way that the police have tried to engage with the issue. They have done their best with the avenues open to them.
In Birmingham, a total of three such establishments have been subject to closure orders. All three happen to be in my constituency: Arabian Nites, which I have mentioned; Cloud Nine, which was closed after the suspected sale of laughing gas to children as young as nine, and following breaches of fire safety and venue capacity limits; and the Emperors Lounge, which was closed after a murder was linked to the premises, but which has since reopened after a three-month closure order.
As the law stands, shisha smoking is subject to the ban on smoking in public places, alongside all other smoking in the UK—it is subject to the same rules. Shisha is a tobacco product, so it is subject to the same rules that apply to regular tobacco, in particular the ban on sales to those under 18. When it comes to licensing legislation, however, the Licensing Act covers only the sale of alcohol and certain forms of regulated entertainment. Shisha bars or lounges do not require a licence under regulation unless they sell alcohol or have other regulated entertainment under the 2003 Act.
Some establishments sell alcohol. Arabian Nites was selling alcohol, which was one of the bases on which the police and the council were eventually able to take action, but Cloud Nine and the Emperors Lounge did not have licences for the sale of alcohol, instead falling within the other regulated activities under the Licensing Act. No single agency or piece of statutory legislation regulates shisha activities. If serious incidents occur—shootings or serious violence such as I have had in my constituency—the police may apply for the powers available to them under antisocial behaviour rules, such as a three-month closure order, as we have seen in Birmingham. However, that process takes a lot of time and effort.
Furthermore, many premises will fight their corner with what is available to them through the legal system. It is fair to say, too, that many will do whatever they can to frustrate the legal process, keeping the thing running for as long as possible in order to beat everyone down and evade the enforcement action being sought.
I would be interested to hear the hon. Lady develop what are some good, well made points about the Licensing Act. Obviously she will be fully cognisant of the fact that many shisha lounges are smaller businesses. These are businesses on which people, their families and their mortgages all rely, so the bar on closing them is often set relatively high. The police have an obligation to show that the business should be closed. How does she think that should be balanced with the argument that she is making?
I will develop that point. I absolutely acknowledge that shisha lounges are often small businesses, but a lot of the troubled premises are not the average small business. They are big venues and very lucrative—I have learnt a lot more about shisha than I ever anticipated when I first became a Member of Parliament—and the biggest establishments can afford to have personal appearances by celebrities. It is not unusual to find boxers or Instagram stars visiting such places, putting in a personal appearance in the same way as they might for a new nightclub or members’ club opening in any city across the country. There is a distinction to be drawn between the much smaller operations, which are more similar to a café with the added ability to offer shisha smoking to its patrons, and the big ones that are much more like nightclubs.
The legal tests in existing legislation are onerous, and there is a balance to be struck in ensuring that people can have a viable business and not be shut down on spurious grounds or unfairly. Police and council officers are cognisant of their legal responsibilities and do not want to drive away good businesses, but I believe them when they tell me, in my conversations with them, that some of the most troubled establishments employ high-powered lawyers and do everything they can to frustrate the process. That happens right at the beginning of the process, at the planning stage—they set up as a café or restaurant, and add other things as they go along, developing the shisha business. There are many ways around the system, as well as many gaps, which some individuals are keen to exploit, because this is a lucrative business.
In London, Westminster City Council in particular—I am pretty sure it is Westminster, so I hope I have got that right—has led work looking at tobacco duty, which is often not paid on imported shisha, so there are tax implications as well. I do not want to make out that these are all bad businesses—they are not—but where people flout rules and regulations, they do so in a considered and planned way. They know what they are doing, so it is right to weight the law and to make the thresholds in the legal process that have to be crossed more favourable to residents, because when it goes wrong, as it did for the people of Highgate in my constituency, it is horrendous. It ruins lives and breaks communities, and that is too high a price for local residents to pay for the sake of the business needs of some of the shisha establishments.
In Birmingham, we have 37 premises, many of them concentrated in my constituency, but with some in other parts of the city. That is only the ones that we know about—37 premises known to Birmingham City Council. With no specific licence requirement for shisha, many places open without any recourse to any of the authorities whatever. As I said, the numbers have grown rapidly. The highest concentrations of shisha premises are found in the London boroughs of Westminster, Ealing and Brent, while Birmingham has the highest concentration outside of London.
The statutory provisions around fire risk, indoor smoking, the sale of tobacco to minors and the non-payment of tobacco duty, which I mentioned, are regularly frustrated. The sanctions available under tobacco-related laws are not acting as a deterrent. That is certainly our experience in Birmingham.
The fire risks are considerable. In Birmingham alone, we have had six major fires over the last five years. That is not surprising when one drills down into the situation, because within those premises there is a high number of ignition sources, combustible material and often low staff awareness of fire safety, and some of the venues are situated in hard to get to places, or are big and spread out over a number of floors, which poses a risk in and of itself. A business sector that is relatively small in number suffering six big fires in a five-year period is indicative of a much wider problem. Other local authorities are also greatly concerned about the fire risks.
Something that I thought about when drilling down into the issue—the Minister might raise this himself—was whether it was simply a case of the different agencies not working effectively together. Could it be that although the law, annoyingly, is not all neatly in one place and the powers are spread across different Acts of Parliament, it can be used creatively and effectively to bring the problem under control? After two years of dealing with these issues, I can say that it is not a case of the agencies not coming together. I have seen nothing but good practice at Birmingham City Council, and I pay tribute to Janet Bradley, who has taken the lead on shisha issues, and all of her team there. They have worked with all the other teams across the council, they have worked with partner agencies and they have worked very closely with the police, to whom I also pay tribute for all their work, particularly on getting closure orders.
That is the case not just in Birmingham. Westminster City Council, too, has published a strategy, held a symposium, and got everybody with any interest, whether public health, fire safety, or policing—the whole picture—into a room together to create a strategy for them to deal with the problem as far as the law currently allows. Brent Council either won an award or was shortlisted for one for its work in preparing its strategy. In the Commons debate pack produced by the Library, there was an article that I had not seen before, in which Brent Council’s leader, who wrote to the Home Secretary about the problem in 2017, called some of the shisha establishments in Brent “lawless” places that attracted drug-dealing and sex-trafficking. It is not for want of trying by different local authorities run by different political parties, where people have tried to grasp the issue and find a way to cut through and get enforcement action quickly and effectively, but no matter how much good work is done, in truth it takes a disproportionate amount of time to take action with the available powers and resources.
The time has come to enhance the legislative framework surrounding shisha premises and, I believe, institute a licensing regime specifically for shisha premises. That would allow local authorities to license shisha premises to operate in their area and make it illegal for a shisha premises to operate unless it was licensed. It is important to go after the shisha aspect of the entertainment offer of those premises, because that is the basis on which the business model operates. Those venues are not interested in being your average café or restaurant. The shisha is key. It is lucrative. It is absolutely essential to the business model. That activity, rather than anything else that might be included and covered by licensing regulations, needs to be licensed now.
The first aim of the licensing regime would be to reduce the detrimental impact on communities; that must be at the heart of any such regime’s objectives. It must ensure that premises do not cause a public nuisance, along with all the other crime and disorder issues that I have highlighted. There is also space for the raising of hygiene standards and for safeguarding policies to restrict the admission of under-18s. That is not something that I have focused on particularly in my work in Birmingham, but I often see college-age students—under-18s—going to those venues, and it is pointless to have age limits in law if they are openly flouted in that way. A licensing regime would give us the opportunity to put those policies in place.
We need to have sanctions for non-compliance that cannot be frustrated by the company changing name, which often happens. Even when we do have absolute clarity on the ownership and management of the business there are problems. For example, when the police obtained closure orders for the three venues in my constituency, it was normal, when they or council officers turned up, for people who clearly worked in those establishments to say that they did not work there and did not know who the owner was. Many of the venues do not even have a postal address because, like some other problem night-time economy venues, they evade postal contact. That sounds like a small issue, but it frustrates council officers’ or police officers’ ability to contact those responsible when trying to fulfil their legal duties, and from day one, that stops them taking effective action.
Following discussions with officers at Birmingham City Council and others, I conclude that there are three ways in which we could pursue a licensing regime for shisha premises. The best and most workable solution would be to make an amendment to the Local Government (Miscellaneous Provisions) Act 1982, which would simply state that we are going to control shisha premises. That amendment should provide for an adoptive licensing regime that gives flexibility to local authorities, so that they can set local controls to deal with the issues that they face in their areas. That is important because problems take different forms according to the locality in which the shisha lounge is located. On Edgware Road, for example, problems in connection with shisha premises are of the same order but play out slightly differently from those in Highgate, in my constituency. An adoptive regime that gives flexibility to local authorities is the best way forward, taking a similar approach to that which has been taken on sex entertainment venues. That gives local authorities powers to set local controls and, in doing so, puts local people back in the game and gives them a say on what happens in their local area. I believe that is the change that best lends itself to a licensing regime for shisha premises.
Many of the standard terms that apply in other licensing regimes would be easily transferable to a shisha regime, which would comprise all of the standard enforcement actions that flow from licensing regimes. The key ultimate power would be the ability to revoke a business’s licence and thereby put it out of business, rather than providing an opportunity for it to come back in some other shape or form.
If we do not go down the road of an amendment to the 1982 Act, there are two other ways that I and others consider that a change might be made. Another way of trying to control shisha premises is to strengthen the current provisions of the Health Act 2006 and the Smoke-free (Premises and Enforcement) Regulations 2006. Current regulations stipulate how enclosed a space has to be in order to comply with the legislation. Obviously, there must be proper ventilation and so on. Some premises earning good money can install a retractable roof. When somebody goes to conduct a check, the roof is off so it looks like there is adequate ventilation, as required under the regulations. The roof, of course, goes straight back on as soon as the officer has left the building, because offering shisha outdoors, in the cold weather or in the rain, will massively affect the business model. It is not tenable to assume that the 2006 regulations are being regularly complied with in some of those establishments. We could try to find a way around that but, in the end, I concluded that trying to draft something that closes all the loopholes in the legislation and covers the ways some problematic shisha premises operate would not achieve the desired effect.
I also considered whether it would be possible to reach an agreement on an interpretation of the local government declaration on tobacco, for local authorities with public health duties. An interpretation could be added that councils cannot allow any kind of licence for businesses with a model that gains money from people smoking. The public health duty is to try to reduce the risk of harm from smoking. I am not an official draftswoman, but I did not think that would work. I played around with two other possibilities before deciding that the 1982 Act is the way forward.
Following advice from Janet Bradley and the officer team at Birmingham City Council, and having consulted other local authorities that face this issue, I concluded that the cleanest and most effective way of dealing with the problem is to adopt a licensing regime under the 1982 Act. I would be delighted if the Minister stood up and said, “Yes, you’re absolutely right. We will get on this straightaway.” If that does not happen, I would like him and his officials to have an open mind about the licensing regime and at least to commit to exploring what changes under the 1982 Act might look like. There is a wealth of experience across local government and from other parliamentarians in this House—some colleagues are waiting to speak in the Brexit debate in the main Chamber and could not be here—that the Minister could draw on, which hopefully will convince him that there is a problem that needs a solution, and that this is the best solution on offer.
Following the point made by my hon. Friend the Member for Manchester, Gorton about public health, shisha smoking is as harmful as normal tobacco smoking, if not more so. People still think that the smoke is much less harmful because it goes through the water filtration system before being inhaled. The World Health Organisation and other organisations that have researched this are clear: in one hour on a shisha pipe, a person can take in as much tobacco as if they had smoked 100 cigarettes. The health implications of large numbers of our population smoking shisha on a regular basis cannot be underestimated.
Local authorities have a public health duty. Places such as Manchester, Westminster and Birmingham are trying to do what they can to raise awareness of the public health implications of shisha, but piecemeal work by good people in good local authorities is not the way forward. The work should be led at ministerial level, at least to convene a roundtable to get the right people in the room, to think about how we might do more together through central Government and to raise awareness of the harm of shisha smoking.
We are storing up future public health problems for ourselves. I would be grateful if the Minister shared his thoughts on that. My absolute ask, as I have said throughout my speech, is for a licensing regime for shisha. The residents in my community have suffered greatly because of the gaps in the current system. It has taken us too long to get temporary action. That is not good enough. My residents deserve better. A licensing regime is the best way to deal with the problem once and for all.
We seem to have a surfeit of time, so if you want to call other anyone else to speak, Mrs Main, that is fine.
I thank the hon. Member for Birmingham, Ladywood (Shabana Mahmood) for securing this debate on an issue of great importance to her constituents that has wider implications for us all, regardless of the part of the UK we represent. I should say that my voice is going, but not because I have been researching for this debate—it disappeared overnight but I will do my best to say what I can before it gives way.
There are a number of shisha bars in Glasgow. We counted them up in the office and think there are eight, six of which are in my constituency. We even picked up word that there is a shisha-on-wheels delivery service. I am not quite sure where that would fit in current legislation in Scotland or in the UK. It is clear that this is a grey area and that more needs to be done. Where there are smoke and mirrors, literally, there is potential for criminal enterprise and issues with building regulations, enforcement and the source of the tobacco, which may enter the country illicitly. A friend, Qasim Hanif, raised a concern that the tobacco is poor quality and does not comply with regulations, which causes health issues additional to those the hon. Member for Birmingham, Ladywood set out.
Glasgow adopted the Scottish Government’s smoking ban in 2006, and it has been spectacularly well complied with ever since. Almost 10 years on, it is unthinkable that people used to smoke cigarettes in bars, restaurants, buses, theatres and cinemas. We have moved on so dramatically from that. The outlier of the regulation has been shisha bars. In December 2012 a shisha bar in my constituency was the first to be prosecuted for flouting the smoking ban. Even now, I hear worrying reports of underground shisha bars without the appropriate ventilation or fire safety measures. The hon. Lady mentioned that the fire risk is quite significant.
A local councillor in my area, Stephen Dornan, recently objected to a shisha bar in Tradeston due to the antisocial behaviour associated with the premises, although the majority of those in my constituency are in industrial areas rather than residential areas. If that changed and they became more commonplace in residential areas in the city, we may well see more of the antisocial behaviour that the hon. Lady outlined. In a broadly industrial area there might not be the same number of complaints as in a community area, as she described.
I congratulate the hon. Member for Birmingham, Ladywood (Shabana Mahmood) on securing this debate. I apologise for not being here earlier; I had a meeting with the Fisheries Minister and could not get back in time. The social issues are important, but so are the health issues that the hon. Lady referred to. Shisha is becoming increasingly popular in all sections of the community. Although I do not have a shisha lounge in my constituency, there are some indications that they are popular among young people. Smokers usually range between 18 and 55 years old, but shisha lounge users are in their 20s. Does the hon. Member for Glasgow Central (Alison Thewliss) agree that it is imperative to have a regulation in place to ensure that the younger generation, who think it is a herbal supplement and perfectly healthy, are in a safe and regulated environment?
I agree with the hon. Gentleman. I am glad to see him here because we missed him very much in the Adjournment debate last night. I was going to send out a search party to see where he had disappeared to.
Shisha bars are gaining popularity among young people who do not drink alcohol, either by choice or because of their religion. There is clearly some demand for that type of space where no alcohol is served, because the options in many town and cities are pretty limited. If people want to go out, they are obliged to be in a place where alcohol is being sold and drunk, but that is not necessarily appropriate for everyone. There is a balance to be struck between the social good, where people can come together in an environment where there is no alcohol, and the harm from smoking shishas that the hon. Gentleman points out.
The perception that smoking shisha is cleaner and better than smoking cigarettes is a very dangerous myth, particularly for young people. The hon. Member for Birmingham, Ladywood pointed out that one session on a shisha can be as bad for your health as smoking 100 cigarettes. That is quite stark. That information needs to be out there and well known. If the Government did more to promote the public health message, that might be useful for many of our communities. The tobacco is usually fruit flavoured and slightly different from cigarettes, which can offer a false sense of security that it is not as bad for you, but smoking it doubles the risk of lung cancer and respiratory illness. It also contains all the factors that we know are harmful about tobacco and it is addictive. Because of the way that shisha is consumed, people take other chemicals into their lungs from the heating and burning process. It can be more harmful than smoking.
In Scotland, business owners need to be licensed to sell tobacco, including shisha tobacco. That does not apply in the rest of the UK, so businesses selling tobacco must be on the Scottish tobacco retailers register. Those found to be flouting the rules by selling tobacco without a licence can face a £20,000 fine. Such legislation is useful. Glasgow City Council has also done some work on this issue and reported on the enforcement of smoke-free legislation and initiatives. It had a specific shisha initiative to look at the issue within the city because it appreciated that the problem was growing and had perhaps simply grown organically.
The council visited different premises and had discussions with owners and environmental health officers, who conducted some of the enforcement initiatives with Police Scotland. They visited premises where persistent non-compliance had been noted, but the premises changed hands quite quickly afterwards. Such action makes enforcement difficult. As the hon. Lady pointed out, it can also mean greater cost to the police and local authorities. Because the regime is not quite there, the costs fall to environmental health and the police to take enforcement action. As we know, local authorities face great restrictions on their ability to do additional work.
We need to look more widely. Some of the engagement did lead to some better practice and improved things. Ventilation was considered. That engagement led to better reconstruction of premises and how they facilitate premises design that does not flout the legislation and supports the smoke-free legislation in Scotland, so there has been some positive engagement with enforcement action and we should take the positives from that.
More could be done to tackle the cultural attitudes towards smoking shisha. Although cigarette packets display warnings and graphic images, no similar branding regulations apply to selling shisha products. In fact, the opposite applies. The bars are glamorous and the surroundings luxurious. They are promoted in the same way as pubs—“Come and watch the football and smoke some shisha.” We need to think about how that is becoming more glamorised and tackle it with proper enforcement action and public health information. I urge the Minister to work with the Scottish Government on this matter, because good practice could be shared in a relatively small area of policy. We should see what more we could do together to get the public health message out there and make sure that people know what they are getting into when they smoke shisha.
It is a pleasure to serve under your chairmanship, Mrs Main. I thank my hon. Friend the Member for Birmingham, Ladywood (Shabana Mahmood) for securing the debate. She has done the House a real service because a lot of us, even though we know something about licensing, were unaware of the issue. I hope that when we hear from the Minister we will be able to chart a way forward. From the briefing that my hon. Friend kindly sent to us all, I was struck by how big the issue is, and is becoming more so, particularly in our urban areas. The figures she provided on the growth of shisha premises were stark: from three in Birmingham in 2007 to 28 in 2018, with more planned. The issue is obviously growing and needs to be addressed.
From listening to my hon. Friend’s speech and looking at the issue, I thought there were perhaps two separate issues that we need to address. The first is the appropriateness and effectiveness of the Licensing Act 2003, and then there is getting licensing legislation that is specific to shisha lounges. I want to look at the first issue for a moment, because I managed to read the 100 pages of documentation online about the Arabian Nites shisha lounge. I saw for myself how difficult it was for authorities in Birmingham, including the police, to get it shut down, even when there were major firearms offences, and that was really worrying. Presumably the lounge had a licence to sell alcohol and for late-night music that was covered under the 2003 Act, but lots of probably criminal activities went on. We might associate some of the antisocial behaviour recorded at the club with a nightclub that had got out of control. There were fire safety concerns, smoking indoors, antisocial behaviour, noise, litter, non-payment of tobacco duty and underage sales, as well as other non-compliant activities.
Interestingly, the Minister raised a point about not putting local businesses out of business. Of course, none of us would want to do that if they are properly managed, are compliant with legislation, are not causing a public nuisance and are not a hazard to public safety. The one voice that we have not heard enough of in this debate, except for what my hon. Friend said, is the voice of the local community, who find the Licensing Act very hard to challenge. The police had to go through a difficult court case. It took days and days to gather evidence to get the premises that had breached so many laws closed down. It is not clear yet whether the premises cannot simply open again under another owner, which I know has happened in several areas. So the first issue that I wish to put on the Minister’s agenda—I will come back to it in a minute or two—is the appropriateness and effectiveness of the Licensing Act.
The second issue, and the major substance of my hon. Friend’s concerns, is that there is no specific licensing scheme that applies to shisha lounges, especially the ones—most of them—that do not serve alcohol. Where licensing seems to fit, as she rightly pointed out, is through what I think could be an addition to the Local Government (Miscellaneous Provisions) Act 1982 by simply adding a new schedule to the Act that would cover shisha lounges. The purpose of the Act is to enable local authorities to regulate certain types of activity in their areas. The schedules currently cover sex establishments, street traders, refreshment premises, tattoo parlours, ear piercers and so on. I had a look at Birmingham City Council’s website and Durham Council’s website to see exactly what the system entails. Generally speaking, it is straightforward and the website is clear about what people have to do. I looked at tattooing and Durham’s website clearly states:
“Applicants will need to ensure that their procedures, equipment and facilities comply with local bylaws—are safe, hygienic, prevent the spread of disease, and comply with the duty of care required by the Health and Safety at Work etc Act 1974.”
Also, they are inspected to ensure that they are fire safety-compliant. So we have a useful piece of legislation and it would not take the Minster or his team a great deal of effort to introduce an amendment to the Act and simply add a new schedule. What is interesting and relevant about schedules is the fact that they are specific to the type of activity being regulated. I hope the Minster will think about that.
It seems to me that, specifically with regard to shisha lounges, hygiene standards could be raised and safeguarding work could be done. There are sanctions for non-compliance and there is clarity on ownership and management. That can be a real problem not only with shisha lounges, but with nightclubs and activities that fall under the 2003 Act. Clear sanctions can be highlighted for a breach of tobacco control regulations and public health legislation, and I hope that the Minister will consider that.
I have a couple of additional points to raise, in relation to the planning regime. We need to think about how planning could be used for better regulation, particularly with respect to the number of shisha establishments in an area—because they do not get planning permission as shisha establishments. Generally, they get it as a restaurant or café, and the shisha activity is an add-on. That creates an issue for the planning system, and we may need to consider a use class that will specifically address shisha lounges. There is also an issue with regard to arguing that there is a cumulative impact from establishments in an area. Usually, cumulative impact applies to premises that fall under the Licensing Act 2003 rather than those covered by the 1982 Act. Building regulations are also relevant—in particular, the enforcement of regulations on fire safety and controlling the numbers attending premises. Because of cuts, many local authorities find it difficult to employ enforcement officers.
Obviously we need to address the issues to do with shisha lounges. My hon. Friend the Member for Birmingham, Ladywood is right: an amendment to the 1982 Act would do it. However, we need an overall review of the Licensing Act 2003, to test whether it is still fit for purpose. The experience of many Members of Parliament is that residents find it too difficult under the 2003 Act to get premises closed, to stop proliferation of premises, and to stop premises’ opening times getting later—or earlier in the morning. I am not quite sure which way round to put that. There is a good opportunity for the Minister to put his stamp on some new and, hopefully, effective legislation.
It is a great pleasure to serve under your chairmanship, Mrs Main. I congratulate the hon. Member for Birmingham, Ladywood (Shabana Mahmood), whose constructive approach to the debate has engaged those on both the Opposition and the Government Front Benches. Her speech showed her passion for supporting her constituents and ensured that, rather than having a political argument—the issue is probably above politics—we have engaged in a constructive discussion about what we can and should do, and how people can work together to achieve something. I intend to follow the same constructive approach in my response to the debate.
I am a bit of a libertarian, so I am not necessarily always in favour of introducing new licences or imposing new requirements on business. The hon. Lady said that some of her constituents like going to shisha bars. Funnily enough, I was talking to a reporter on my local paper, the Lancashire Telegraph, which covers Blackburn—just over the border from my constituency—where there are some shisha bars. Most of them are well run and managed, and I know that the hon. Lady will confirm that in relation to her constituency. Many are smaller businesses, and often family businesses. They provide people with a living.
Today’s debate is important, because the prevalence of shisha bars is something new for Britain and our society, and my Department of course is responsible for communities. It is exciting that there are new ways for people to relax that do not necessarily involve alcohol. When such changes happen in Blackburn, Manchester, London, Birmingham and elsewhere, we must look at the law and see whether it covers the current situation. I suppose the question we should ask is: what response to a new activity would be proportionate?
The law currently governs many of the spaces in question, but I accept the hon. Lady’s point about the complexity of the law and the need for multi-agency working. Many of the relevant provisions will be in planning legislation, including on such matters as the construction of ventilation and outdoor seating areas. There is a requirement to license outdoor seating areas. Environmental health will have a role and, of course, some of the more serious crimes that the hon. Lady mentioned must be dealt with by the police. We cannot expect—I know she is not asking for this—local authorities to control the most serious associated gun and gang violence through licensing law. Whatever we do—even if we bring forward a new licensing regime—we must not lose multi-agency working.
There are, of course, already severe sanctions for breaching the existing regulations and laws, including one of up to £2,500 for breaching the smoking ban, as has been mentioned. Antisocial behaviour closure notices provide the opportunity to close businesses, as we heard with respect to Arabian Nites—although the process the hon. Lady described was quite difficult. On that specific case, it is worth noting that obviously a licensing regime will not be a silver bullet. The venue was licensed and therefore was subject to existing licensing laws—particularly for alcohol. The hon. Member for City of Durham (Dr Blackman-Woods), speaking for the Opposition, said that it would require days of work by enforcement bodies, including the police, to reach the point where the licence would be removed. I suggest that under a new licensing regime where places were licensed for shisha rather than alcohol—or where there was joint licensing—it would still require days of work to prove that licences had been breached. Often the people running the businesses, as the hon. Member for Birmingham, Ladywood pointed out, rely on them for their living.
Would it be possible to regulate the businesses under council entertainment licences? Residents living close by who had concerns about antisocial behaviour or anything else could, through the application process, have input into whether a licence was granted. That would perhaps give control to the community.
I am extremely grateful for that intervention, which draws me on to my next point. When we acknowledge that something new may have problems attached to it, we should next ask ourselves whether a national or local response would be better. I want to consider what can be done through existing local authority powers, whether through entertainment licences or by engaging in collaborative working. As has been identified, at the moment shisha bars tend to be in concentrated areas across England, but perhaps a national response is not the best one. I shall certainly ask my officials to look at the best practice that has been adopted in Manchester and Westminster. Whatever the outcome of the debate, we can probably all learn from that. Where local authorities have identified shisha bars as an issue for their area, or even a benefit, it would be worth their talking to each other and working together. I am sure there is best practice to be shared.
From the work that I have done, and from engaging with Birmingham City Council, I know that council officers who deal with shisha issues in local authorities where it is a problem are already in contact with one another. They know each other well and get together regularly to share best practice, so it happens already. I appreciate what the Minister has said so far. I guess what I was explaining from my experience, which I hope has been noted a bit more than the Minister’s speech has signalled, is that the current rules have too many gaps. Unless there is alcohol, nothing can be done. It is too difficult to get action where there is a licence for alcohol, but if there is no alcohol licence it still takes too long. Of the three shisha bars in my constituency that were closed, two did not have licences for alcohol. I hope that he will reflect on that.
I am not sure I accept that if a premises does not sell alcohol nothing can be done, and I referred earlier to a plethora of powers that are available to the multi-agencies, particularly local authorities. I accept that this is a new issue, and I applaud the collaborative work being undertaken by local authorities, because it is worth them exploring what they can do. The real challenge, however, is enforcement. The hon. Member for City of Durham mentioned the inability of council officers to go around with clipboards enforcing the rules, and the hon. Member for Birmingham, Ladywood identified the issue of protractible roofs, which are rolled open in mid-summer when environmental health officers visit, but closed as soon as they have left. There are certainly challenges regarding the enforcement of existing powers, which is something we should address.
I mentioned the need for enforcement after breaches of the Licensing Act 2003 and the 1982 Act, but no one should think that I believe enforcement to be the answer—I do not. I think that there is a gap in the legislation, and Opposition Members understand clearly how to address it.
Again—hon. Members are being helpful to me today—that brings me to my next point. We have been considering whether a local or national response is best, and if at the end of that evidence trail a national response is appropriate, my mind is not closed to that. As I said, however, there is no silver bullet, and some issues that have arisen are serious criminal offences that would not be covered by any licence—illegally held firearms are not subject to a licensing regime, so we must be careful to have a good look at that issue.
That brings me to my offer to the hon. Member for Birmingham, Ladywood, because her idea about a roundtable is extremely good. I happily invite her to come and meet me and officials, together with council officers who have real expertise in this area, and we as a Department should start that dialogue about how we can help and what would be an appropriate national response, if indeed one is required. The bar for closing someone’s business should be quite high, as should the bar for a national response when many powers already rest with local authorities. I have not closed my mind to the fact that there should perhaps be a national response, but a lot of work must take place before we get there. I hope that is helpful.
The hon. Lady spoke about shisha bars being an add-on to many cafés and restaurants, and that is something we have identified. In my high street, the local coffee shop is also a bookshop—I am rather keen on books, so I go there quite a lot. In the evening it is also a yoga studio, but I am not quite as keen on yoga and cannot admit to having done it. The multi-use of retail premises was one thing identified by our future high street forum, and particularly the work of Sir John Timpson, who advises the Government on future high street policy. We are lucky that he is doing that as he is one of Britain’s most experienced and longest serving retailers.
As an acknowledgment of the challenges posed by a relatively static use class order system that dates from the 1980s, on the same day as the most recent Budget we launched a consultation on the future of that system on the high street, although not more widely for industrial units. That consultation remains open, and I recommend that the hon. Lady, her council and the hon. Member for City of Durham take part. Again, we have approached this in a very open way, and in the first potential major refresh of use class orders since the mid-1980s, it is important to ensure that the static system becomes more mobile and reflects changes such as the arrival of shisha bars on our high street.
Finally, the prevalence and growth of shisha bars is the sort of thing we try to encourage for our future high street forum, as long as they are legal, well run and do not impede unnecessarily on local residents. The future of the high street must be about a mix of leisure and retail, and all recent reports—including by Sir John Timpson on the Government’s future high street forum, and the Grimsey review—identify that if high streets are not just to survive but to thrive, they must incorporate the night-time economy.
We must get the regulation right and be satisfied that existing laws are enforced well, and if we decide that new regulation is required, we should consider that. A thriving night-time economy is key to the future of our high streets. Indeed, that point is not just for today, because in the most recent Budget my right hon. Friend the Chancellor identified a £600 million plus fund for the future high street. We have the future high street forum, and I will conclude my remarks by again thanking Sir John Timpson for his extraordinary work on high streets, which will benefit the entire United Kingdom.
I thank all hon. Members who have contributed to the debate, as well as the Minister for not closing his mind to the idea of a national-level response and a new licensing regime for shisha bars. I take on board what he says about requiring a high threshold to be passed before somebody’s business can be closed. Members of my family, and my friends and constituents who go to well-run shisha places and have a nice time out, will not thank me for getting their lovely venue, which they enjoy, shut down. I am not a killjoy and I am not trying to get rid of good businesses and establishments; my concern is focused on where things go wrong, and at the moment I cannot accept that we have what is needed to head off such problems before they start affecting residents in the way that many in my community have been affected. I take on board what the Minister said about thresholds that must be crossed, and we must ensure that we have fully considered all the measures currently available. I hope that on further reflection, and given that he does not have a closed mind on the matter, I will be able to persuade him and his colleagues that a licensing regime is necessary.
Normal nightclubs can become troubled premises because they attract the attention of gangs or protection rackets—we know those things happen. I take on board the Minister’s point that there is no silver bullet, but there is a whole world of activity before we get to the serious end of the spectrum that a licensing regime could take into account. I will certainly take up the Minister’s offer of a roundtable, particularly by engaging with council officials from across the country who have a wealth of knowledge on these matters.
I am sorry to intervene on the hon. Lady, but it is important that that roundtable includes representatives from the Scottish Government, because they need a separate legislative response for the solutions suggested.
I thank the Minister for that clarity and hope that the hon. Lady is concluding her remarks.
I am, Mrs Main. I am not an expert on how these matters play out in devolved Administrations, but they obviously need a voice because they face different regimes. I will take up the Minister’s offer, and I hope we will get to have greater knowledge about shisha establishments, the impact they can have and how best they can be regulated.
Question put and agreed to.
That this House has considered reforming the regulation of shisha lounges.
Affordable Credit for People on Low Incomes
[Sir David Crausby in the Chair]
I beg to move,
That this House has considered the provision of affordable credit for people on low incomes.
It is a pleasure to serve under your chairmanship, Sir David, although I hope it will be not just a pleasant time, but a very productive one. We are anxious to leave plenty of time for the Minister to reply because we want, and hope, to make progress with the debate. I address him as an hon. Friend, because in this debate I am drawing information from Feeding Britain, a charity that he, I and other MPs from different parties set up. This debate on the provision of affordable credit for people on low incomes draws on the experiences of groups around the country that are part of the Feeding Britain network. I thank those involved in the network, whose information I draw upon, but particularly the parents and grandparents who have provided information for this debate.
As I gave him much of the information beforehand, the Minister knows that there is far too much to cite in this debate from people in the Feeding Britain network who want to have their say. I will instead focus on an everyday story of Provident. I do not know whether it worries about Salisbury, but Provident is putting out these leaflets in the Wirral, personally addressed, and on the front are pictures of a little girl and the words, “The look on her face”, “Decorating grandad” and “Visiting loved ones”, all playing on the feeling of exclusion that many poor people feel all the time, but especially at Christmas.
Behind those leaflets there is a carefully targeted business plan, because certainly Provident stepped up its activities with the beginnings of the roll-out on universal credit. Officers of Provident were knocking on doors with application forms in one hand and fistfuls of money in the other, asking whether people wanted to sign up or needed a loan, knowing that while we still have difficulties with universal credit today, we certainly had mega-difficulties when it was first rolled out in Birkenhead.
I congratulate the right hon. Gentleman on securing this important debate. Particularly with people facing problems such as universal credit, does he share my concern that a growing number of people—I think it has gone up by 300,000 in the last year—rely on credit to pay for everyday essentials? That is hugely unsustainable, and we need to look at mixed alternatives.
Indeed; we will try to draw the Minister on that. Part of the leaflet concerns short-term loans, saying that the APR is 535.3%; I hope Members of Parliament know what APR—annual percentage rate—is. I will not press the question, but the Minister has one degree from Oxford and one from Cambridge, so I wonder, if we were looking at a £300 loan and had to pay it back within three months, what the loan would cost and what the rate of interest would be. I am not going to pause; I will give the answers. It is one of those very easy quiz games, but a horror quiz game, because if the repayment is over three months, Provident wants £429 back at an annual interest rate equivalent to 1,557.7%. That is just one example. Constituents borrowing £350 and paying it back over 12 months have to pay back £655.20.
I commend the right hon. Gentleman for all the hard work he does and the high regard in which he is held in this House when it comes to poverty issues for people across the whole of the United Kingdom of Great Britain and Northern Ireland, not just in Birkenhead. I thank him for that. Does he agree that there must be a viable alternative to the payday loans he is referring to? Could the credit union, which is growing in my constituency and has been extremely helpful to people on low incomes, be the safe and regulated alternative, bearing in mind that it encourages responsible lending and responsible saving hand in hand?
I totally agree with that. I suggest that there is no silver bullet. Clearly, credit unions have a part to play, but they are not as thriving in Birkenhead as they are in others parts of the country. Therefore, we need a whole strategy of policies, so that the geographical chance of life neither protects people nor leaves them vulnerable and unprotected. If someone has a really good, strong credit union and they are a member of it, that is good news, but if there is no credit union, or if their pattern of behaviour does not easily fit into what the credit union requires, it is difficult for them. I want to draw the Minister on that later in the debate.
The leaflets that are now going out in our constituencies claim that there are no late payment fees. I am pleased to be able to say that, unlike other companies that lend people money when they are extremely vulnerable, there is no evidence at all that the people coming for repayment come with baseball bats to enforce that repayment. But of course, Provident has another strategy, so it does not have to do that. To use another example, one of the volunteers in the Feeding Britain network tells us that one of her friends who got close to paying off her debt with Provident was immediately offered another loan. If someone has problems repaying, they are offered other loans, so the loans mount up and become very substantial, and if they are towards the end, Provident tries to make it part of their working-class economy that they should have loans, by suggesting that they should take another loan.
I thought that, before I come to what I would like to see as part of the Government’s strategy, I would talk about the hard sell. One mother went on to the website to see what the loans prospects were. Having merely gone on to the website, she said that she was being called up eight times a day until she took out a loan. There is quite a hard sell here. As well as picking on areas that are vulnerable because universal credit is being rolled out and picking on the vulnerable areas across the country in periods such as Christmas and the summer holidays, there is a real danger that merely inquiring about a loan means that people then get the hard sell.
What about the strivers? For example, we had two people in work and two children who borrowed £100 from Birkenhead, and they were anxious about paying bills and feeding those children. They ended up having to pay back a few pennies less than £500. We have also seen the Scarlet Pimpernel effect in Birkenhead. If someone googles loans, Google throws up, in the first instance, those loan companies that are likely to cost them the most to borrow from. Will the Minister look at whether there is a case for saying that Google should display what we could all agree are the best companies to deal with, not those with the highest charges?
Will the right hon. Gentleman give way?
I will happily give way to an ex-member of the Select Committee on Work and Pensions.
I very much enjoyed serving, up to the time of the general election, on the Select Committee chaired by the right hon. Gentleman. He has great passion in this area and has just made a really interesting point. What would concern me about online advertising is this. Probably these companies are simply purchasing through the Google Ads algorithm; I imagine that there is very little way for them to have the sort of control described, but it is an extremely good point that the companies charging the most interest will have the biggest budgets to pay for Google ads and so on, which almost inevitably means that they will come near the top. We should look at that; it is a very good point.
That is a really good point, and the Minister is nodding, so I know that we are going to get action on it. I am immensely grateful for that intervention.
Let me take another website—Doorstep Loans in Birkenhead. It aims specifically at single parents. It says, “We understand your position. We can help you through a loan.” It says to those who are unemployed, “We understand your position and the particular problems you have. What about a loan from us to help there?” It says to those with a bad credit score, “What about a loan to you?”, knowing that they cannot get one from elsewhere. Those with disabilities are also lined up for special treatment.
Let me switch to Leicester, which has also given us some information. One pensioner took out a loan to help to buy Christmas presents. She is now repaying £100 a month for that loan. That is hardly a good prospect for her—it is a very large part of her pension. Derbyshire, too, shows a really worrying trend. Provident went to one of those houses that are known to have young people in supported accommodation, who are very vulnerable, and managed to sign up every person in the house for a minimum of a £100 loan.
Putting fires out is part of the Minister’s job, but so is thinking creatively about the future, as he has always done on Feeding Birkenhead, so may I put before him the idea of a citizens’ bank? It would not be a silver bullet; it would be part of many other things. If we had asked poor people to help to design universal credit, none of them would have said, “I work to a five-week month or a four-week month for payments.” They would have said, “This benefit needs to be designed for me, which means daily payment or weekly payment.” I very much hope that we could take things a stage further and include poor people in designing the bank, so that it would be a bank that they wanted. I hope that we can pick up the hon. Gentleman’s idea, which was in the Budget, about interest-free loans. I hope that we could sign up the Department for Work and Pensions so that users of the bank would make agreements for loans that they paid back in a manageable way—paid back, with their agreement, from benefit—so that there would be a minimum element of bad debt.
As we all know, Wonga said that it had to charge 5,000% because of the bad loans that it had. It had many bad loans precisely because it was charging 5,000%. I think that if we could eliminate from the system people who cannot pay and the few who will not pay, we would have a very different, and viable, model. My plea to the Minister today is this. Might people who are interested be able to come and talk to him further on the idea that I have described? Might we also not exempt the banks from their responsibilities? Many of my constituents have problems because of the way that the banks behave. The situation is pretty bad: the banks give large sums of money—thank God—to their foundations, and those foundations give out money to projects to undo some of the damage that the banks themselves cause. I therefore hope that this is the opening of another chapter on how we get decent banking systems that fit the moral economy of life for working-class people, rather than roughing them up.
Order. It is not normal, in a half-hour debate, for hon. Members to speak unless they have sought the permission of the mover of the motion and the Minister. Is the Minister happy for other Members to speak at this point?
Yes, as long as I have a bit of time.
In that case, I call Faisal Rashid.
Thank you, Sir David. I also thank my right hon. Friend the Member for Birkenhead (Frank Field) for securing this debate to highlight some of the appalling and exploitative lending practices that target many of the most vulnerable people in our society.
Despite the welcome demise of big payday lenders such as Wonga, people without enough to get by remain over-exposed to manipulative lending practices. A leading debt charity found that an estimated 1.4 million people used high-cost credit for everyday household costs in 2017; the figure was up from 1.1 million in 2016. High-cost credit keeps many trapped in a vicious cycle of indebtedness just to make ends meet. It is a scandal that those who are least able to afford it are left with no choice other than to accept the highest lending rates.
With in-work poverty on the rise, the Government must do more to reform the broken credit model and tackle the persistent debt spiral into which many working families have fallen. As I have witnessed in my constituency of Warrington South, credit unions constitute a commendable community initiative that seeks to prevent other people from falling into the trap of high-cost borrowing; but without substantial Government support, such alternatives struggle to address the problem fully. Often, low-income households are unaware of or unable to access affordable credit provision in their local area or nationally.
The Government must commit to a comprehensive long-term programme to expand the provision of community lending to ensure that those struggling to make ends meet can access alternatives to high-cost credit. At present, the Government appear simply to be making matters worse. I have been contacted by several constituents who have had to take out loans as a consequence of the Government’s disastrous implementation of universal credit—a flagship Government social security policy. Provision of access to affordable credit is a potential lifeline to many.
I hope that the Government will begin to take a proactive approach to solving this critical issue. It involves not just payday lenders like Wonga, but banks and building societies. There is a huge difference between interest rates for someone borrowing £1,000 and someone borrowing £20,000. The interest rates are so different: they range from 20% to 6%. We need to do something about that and ensure that provision is appropriate and affordable for people in need.
I think that the Minister wants about 10 minutes to respond to the debate. Is that right?
I call Stella Creasy.
Thank you for letting me speak, Sir David. Do not worry: I promise I will be quick. I rise simply, and possibly at my own risk, to disagree with my right hon. Friend the Member for Birkenhead (Frank Field)—I admire him immensely for his work on poverty and perhaps, given the time of year, he can be the ghost of Christmas yet to come for the Minister—because there is a silver bullet in this circumstance. All of us deal with people in our communities who are struggling because there is too much month at the end of the money and are borrowing to put food on the table, to keep a roof over their head and to put petrol in their car to get to work. They need us to recognise the lessons of payday lending—the lessons of those interest rates. It is not about the decimal point; it is about hooking people into debt.
I know the Minister knows this in his heart. I know he recognises that payday lending is not the only spectre hanging over Christmas for people this year. Indeed, in our country now, people are better protected when taking out a payday loan than when they are using many of the other forms of credit. My right hon. Friend talked about Provident. Provident takes many incarnations in this country. Vanquis credit cards are pushed in my local community; Vanquis is also owned by Provident. Credit cards in this country are the new form of unaffordable debt for so many. The rates of interest, especially on the credit cards targeting people on a low income or with a bad credit history, lead them into higher levels of debt than they would get into with a payday loan. Guarantor loans rip apart communities and families as people get into debt and then have to tell someone else, who has guaranteed the loan, that they have got into debt. The companies are chasing two people at the same time for the same loan.
All those examples, all those scenarios, are things that we could stop if we learned the lessons of payday lending. Wonga may not exist now, but the industry carries on in this country. It has gone from 400 to 150 companies, but the point is that it is not pushing people into debt in the way that it was two or three years ago—when it caused the concern that my right hon. Friend and my hon. Friend the Member for Warrington South (Faisal Rashid) now express for other forms of credit in this country.
I know that the Financial Conduct Authority has ruled out bringing in a cap for all forms of credit, but I again ask the Minister: how much more evidence do we need about these companies and the way they are evolving before we learn the lessons of payday lending?
In the Financial Times this week, the owners of Amigo Loans boasted about how the lack of regulation and the changes in regulation have benefited their industry. By not capping all forms of credit, in essence, we are pushing people into other forms of high-cost credit and towards other legal loan sharks. How much longer do our communities have to suffer? The truth is that they are suffering. I am a Labour and Co-op MP, so I would love to see more credit unions, but they cannot compete with such companies and their rapacious behaviour, or with the way they have evolved to evade legislation.
We need comprehensive legislation. Please, let us not have another year of the Minister and me arguing, yet again, about the benefits of that silver bullet. There is no single better thing that we could do than cap the cost of all forms of credit in this country to give an even playing field, to make sure that the banks treat people fairly, to make sure that all forms of new credit treat people fairly, and to give our communities hope for 2019 when their wages do not match up.
It is a pleasure to serve under your chairmanship, Sir David. I thank the right hon. Member for Birkenhead (Frank Field) for raising this important issue, which, as he knows, I have been passionate about since our days of setting up Feeding Britain. We went to South Shields and Salisbury to look at the experience of people using food banks. We even travelled to Paris together to try to get some inspiration for how to get the right model—
Before the riots.
Absolutely. I really want to make progress on the issue during my time as Economic Secretary, and in my response I will draw attention to some of the measures that have been taken.
I also had the pleasure of working with the right hon. Gentleman on the Select Committee. The assiduous way that he has pursued the challenges that people on low incomes face is legendary across the House. The whole House admires his efforts.
I want to get to the heart of the matter. The right hon. Gentleman has raised a number of issues about the conduct of Provident, as have five other hon. Members. We also had a conversation earlier this week. I recognise that he sees a citizens bank as playing two roles—first, ensuring that the poorest members of society can access core banking services, and secondly, providing credit to those people to help them to smooth their income, spread costs over time and cope with unexpected financial shocks. I will address each of those in turn.
I will set out how the progress that the Government have made on ensuring access to core financial services such as bank accounts has been achieved. The nine largest personal current account providers in the UK are legally required to offer a basic bank account to customers who are unbanked. Those accounts must be fee-free and must not have an overdraft facility.
The right hon. Gentleman drew attention to the key issue of the need to access affordable credit. The Government’s vision is for a well-functioning and sustainable consumer credit market that can responsibly meet the needs of all consumers. I think there is some agreement on that vision on both sides of the House.
I recognise that we face a playing field that is not level. My hon. Friend the Member for South Suffolk (James Cartlidge) and other hon. Members raised the point about advertising budgets, which is why one of the Budget announcements seeks to tackle the barriers faced by key partners such as housing associations to referring people to sources of affordable credit. The default setting is to find a better option than some of those that can be found on Google.
Has the Minister considered speaking to Google and other companies about that? It is a good point that it is very difficult to police the robot algorithm that sets up their adverts. I do not see how he can do that unless he speaks to the companies themselves.
I am happy to take on that suggestion. I will look into what we can do as part of the challenge we also set in the Budget to introduce technical solutions to try to level that playing field and to make community development financial institutions such as Scotcash, which I visited in Glasgow in September, more accessible earlier in that process.
On Financial Conduct Authority regulation, I will try to address the points raised by the hon. Member for Walthamstow (Stella Creasy), who has raised the matter in the House previously. There was a review in May, although she does not agree with all its conclusions. Since the review, I have had more conversations about Amigo Loans and other issues, such as what can be done to monitor and to provide the evidence. In the interests of responding to the right hon. Member for Birkenhead, I will not carry on, but I do not want to be flippant about the serious concerns of the hon. Member for Walthamstow.
The FCA governs the rules about the provision of credit and is responsible for the regulation of consumer credit. It is a robust regulator, which I always encourage to be even more robust. It has the tools to take swift, effective action against improper practices. My regular dialogue with the chief executive, Andrew Bailey, and the director of strategy and competition, Christopher Woolard, covers that topic, and I know that high-cost credit is a priority for them.
The right hon. Gentleman specifically highlighted a number of worrying examples of high-cost credit lenders in Birkenhead. I listened with concern and serious dismay to the impact of those practices on vulnerable consumers. I hope the action that the FCA is undertaking in relation to lenders, as part of its broader review of the high-cost credit market, will have some impact.
The right hon. Gentleman mentioned Provident. The FCA is consulting on new rules and guidance specifically for home-collected credit firms. I will draw its chief executive’s attention to this debate. The rules will include requirements for firms to clearly explain the costs of a new loan compared with the cost of refinancing an existing one, and guidance stating that firms cannot visit customers to offer new loans without an explicit request from the customer.
The provision of affordable credit is a multifaceted problem and there is no single solution to overcome it. It is not sufficient to simply tighten regulation for high-cost lenders. Therefore the Government are desperately keen, and have taken steps, to ensure that low-income consumers can access safe, affordable and sustainable credit. In our civil society strategy, we announced that £55 million of funding from dormant assets would be directed towards addressing the problem of access to affordable credit and alternatives.
In the autumn Budget at the end of October, the Chancellor announced a package of measures to support affordable lending, including a prize-linked savings scheme to encourage the growth of the credit union sector. Although the sector is variable in quality, as has been discussed, there are opportunities to expand it. Another measure is an affordable credit challenge fund to encourage the UK’s vibrant FinTech sector to solve the challenges that I just discussed with my hon. Friend the Member for South Suffolk. A further measure is a change in the regulatory boundary to allow registered social landlords to offer their tenants better community lenders. A final measure is a feasibility study into a no-interest loan scheme, and a pilot of that scheme.
The right hon. Member for Birkenhead is absolutely right that banks have a responsibility to assist and facilitate better solutions in this area. Earlier this year, we took through the House the single financial guidance body, which will be a huge partner in working—I hope—with the banks, which often have worthwhile initiatives that are piecemeal and not joined-up. My vision, which is very similar to his, is of the banks coming together to recognise that, across the country, there are pockets of poverty and deprivation that need a new solution, which involves pooling their expertise and endeavour and working closely with the single financial guidance body to deliver a better set of options and outcomes for the constituents for whom he has been fighting so earnestly for 40 years.
I thank the right hon. Gentleman for securing the debate. He and other hon. Members have raised some significant issues that I take to my heart and back to my office. I hope I have offered him some reassurance by setting out the comprehensive and concerted actions that the Government have taken with the FCA to address the challenges in this area. I am clear that the Government are on a journey to actively and comprehensively support vulnerable borrowers. I want to continue to work with him, and other hon. Members from both sides of the House, using the knowledge and expertise that exists, to come up with even better solutions to deal with a real problem in some communities in this country.
Question put and agreed to.
Gender Pay Gap
I beg to move,
That this House has considered the gender pay gap.
It is a pleasure to serve under your chairmanship, Sir David. I feel very greedy for having just intervened in the last debate and now having my own debate, but both debates are on matters that are close to my heart, because both make a big difference to our local communities.
I mean no disrespect to the Minister present—the Minister for Women—but I see this subject as a matter for the Treasury first and foremost, because I think that closing the gender pay gap is one of the most positive economic policies that we could have in this country, given the benefits that it would bring to our country as a whole. We have spent the past eight years, since I was first elected to this House, arguing about austerity—I know that there are different views on it, but Labour Members are pretty clear that it has not been a good economic policy. There are probably different views across this Chamber as to whether Brexit is a good economic policy—many of us are certainly concerned about the impact on our economy—but I hope there is agreement across the House that closing the gender pay gap would have a positive impact on our economy.
For me, it is interesting and telling that we do not see this matter first and foremost as one of economics. That is one of the challenges we have to address, because we know that closing the UK’s gender pay gap would add £150 billion to our GDP in the next couple of years and that an extra 840,000 women would be added to the UK workforce. Those figures reflect what the gender pay gap really is: untapped talent in our society. Given that we have gone through the horrors of austerity and we appear to be going through the horrors of Brexit, never more have we needed positive economic policies that tap into that talent, to help us try to redress the balance. To the person who tweeted me earlier this afternoon, saying that in debating the gender pay gap I may as well be debating “unicorns”, I say that today the “unicorns” are in the main Chamber, in relation to Brexit. This debate is very much a reality.
The gender pay gap is a reality that we have always known existed; we have always had data to show a general gender pay gap in this country. We know from the annual survey by the Office for National Statistics that the average gap is about 13%. However, what has changed in this debate in the last year has been the data about particular companies, busting open the argument in people’s workplaces and revealing to them the variations between different sectors. It has shown that 78% of companies in this country that have more than 250 employees are paying the men they employ more than the women—that is on average, so it is not just about individual men and women. That is a systematic undervaluing by those companies and organisations of the women who work for them, and of the possibilities that they could bring to their company or organisation.
I am delighted that the hon. Lady has secured this debate and it is a pleasure to join her in it. I was on the Delegated Legislation Committee that considered the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 and put them through. I was surprised, as I am sure she was, that the bar was set at 250 employees. I know that is a good start, but does she agree that some of the biggest challenges are in the small and medium-sized companies that have fewer than 250 staff, and that it would be fantastic to hear at least an expression of willingness from the Government Benches to extend that legislation as soon as possible?
I completely agree with the hon. Lady. At the moment, only about 60% of the British workforce are covered by that legislation, so when we talk about understanding the gender pay gap in this country, we still have 40% of the gap to understand. I will come on to that issue later because, like her, I am impatient and, also like her, I have a passion for that piece of legislation.
We should honour all of the parliamentarians involved in this, including my right hon. and learned Friend the Member for Camberwell and Peckham (Ms Harman), whose determination to get the Equality Act 2010 through set us on course to where we are today. Sometimes her contribution to this process is forgotten, perhaps by Members who are new to the House. Anyone who has ever dealt with her on these issues knows full well how passionate she is about them and everyone should recognise that.
The variation within sectors is also pretty telling for us, in terms of the kinds of experiences that women in our country—our constituents—might face.
On that point about looking at different sectors, I used to work in the third sector—the charity sector—which people often refer to as “the women’s sector.” However, when we look at the top and at the management, we see that it is not reflective of the sector at all. Does my hon. Friend agree that that is a big issue?
Completely. One of the things that is so powerful about this data is that no sector—public, private or third—is immune from critique, because frankly none of them is valuing women in the way they could. That is reflected in how they pay them, how they promote them and how they work with them.
I am very struck by some of the brands that make a point of selling to women. After all, the one place where women have the majority of power in our society is in their purchasing power, as we account for 70% of purchases in this country. Yet those brands that make a virtue about selling to women are often the ones that, when we look at their pay gap, are some of the worst in this regard. I would not necessarily have put Sports Direct up there as champions of feminism, but its gap is 6%. Contrast that with Sweaty Betty, which has a 62% variation; with Monsoon, which has a 36% variation; or with Boux Avenue, which sells lingerie and has a 75% variation. Even when we are buying those companies’ products, they are not necessarily using the money to pay their women employees equally.
Many people have rightly challenged the data about the gender pay gap. After all, there were only four measures, so I agree that the data is a blunt tool. There are certainly things about the data that I would like to know more about. However, my argument today is that just because the data is not perfect does not mean it is not powerful. I absolutely agree that we need to understand much more than just gender when it comes to inequality in the workplace, the undervaluing of talent and what that means for our economy. It certainly means that we need to understand whether we can get better data on how black and ethnic minority employees are treated in the workplace. We know that the full-time pay gap for black African women is 19%, and that for Pakistani and Bangladeshi women it is 26%. That is in contrast to the general gender pay gap of 18%. Black male graduates earned a whopping £7,000 less per year than their white counterparts in the past 10 years. One of the things we know is that although black men have been more likely to invest in higher education than their white counterparts, they are less likely to have benefited from it in their pay packets. That is an interesting challenge for us.
This data also does not tell us about part-time work, which is absolutely crucial for women because, at 73%, the majority of part-time workers in our country are women. We know that there is a gender pay gap within the data for part-time work, but it is not as clearcut as the one within the data for full-time work, which is the data that we have for these individual companies. The data also does not tell us about age. For many people, understanding the difference of the gender pay gap, and therefore understanding what is driving it, is crucial when it comes to age. People presume that the gender pay gap is something that happens later in life. Actually, we are already seeing a gender pay gap building up with graduates, within 18 months of them entering the workforce. Again, that tells us that the gender pay gap is not necessarily what people think it is.
Also, in relation to the point made by my hon. Friend the Member for Midlothian (Danielle Rowley), the public sector cannot lecture the private sector in this regard. When we look at the NHS, we see that 77% of its employees are women but it still has a substantial gender pay gap. That should tell us—as the people in charge of public services—something about our ability to value women and their worth in the workplace. Indeed, the private sector pay gap has decreased, from 20% to 16%, while the public sector pay gap has widened to 13.9% in the past five years.
The data also does not tell us what difference getting qualifications makes. Again, when we go on to consider what might be causing the gender pay gap, people make presumptions about the impact of training and qualifications. Actually, when we look at the data, we see that it is not necessarily the case that women who have been educated to a higher level, such as degree level, are being paid more. Indeed, despite more women being educated to a higher level, there has been little or no change in the gender pay gap between groups of workers qualified to a degree level since the early 1990s. We also see a gender pay gap when it comes to apprenticeships. For level 2 and level 3 apprenticeships, women earned an average of £6.85 an hour, compared with the average for men, which was £7.10 an hour.
One of the things that is so powerful about this data is that, because it is so localised to particular companies, it helps people understand what is happening directly to them in a way that a general statistic does not. I have met the Minister to talk about one of the challenges in this regard: when the data was published in April this year, what impact did it actually have on the ground? I ask that because it is one thing for us here in this House to analyse the data and maybe call to account those firms that sell to women without paying women properly, but it is another thing to talk to our constituents about their experiences of what the data shows about their workplace.
Therefore, when the data was published, a cross-party group of MPs put together an anonymous survey called #PayMeToo to try to understand the experiences of women at the coalface. As the Minister knows, the responses were pretty shocking. People often say, “Data is a great disinfectant. Publish the numbers and that will drive change.” The data from the #PayMeToo survey shows that we might be publishing the data, but we are certainly not telling women to talk about it, and those women trying to talk about it in their workplaces face a hostile environment—I hesitate to use that phrase, but it is very clear from the responses we got.
Women were being told that that was just the way it is; that they work in sectors where there are not any women, so why would they expect women to be paid the same as men? They were being told by HR departments that they should bury the data; that they should not be difficult; that they needed to raise a grievance if they wanted to talk about those issues. They were being told that they could get a pay rise, but it would not be equal to that of their male colleagues, because it was about trying to manage the impact of the fuss that was being created. They were recognising that their companies were using what they called “very creative reporting” to try to minimise the gender pay gap, and so pretend that the issue was not happening. They were being told, “Don’t worry. Next year we will employ some more lower-paid men, and that will sort the problem.”
One of the things that I hope the Minister will commit to is following up that data and gathering it herself next year, when the second lot of data comes out. It should not be up to MPs to try to grab these qualitative pieces of research, when what consistently comes back to us speaks of the hostility that women face regarding the impact of this data; of just how sensitive it is for people to talk about what they earn in this country; and of the presumptions and cultures behind the gender pay gap, which we have to deal with.
Let us try to deal with some of those presumptions. At the moment, it is true that we have only half the story with the data, and many commentators both online and offline, including in The Spectator—I am sure Toby Young is watching—will try to fill in the rest of the blanks for us. They tell us that it is about women and their lifestyle choices—bluntly, that women have kids, therefore they want to work flexibly and to take time out, so of course they are going to be paid less.
My husband has kids.
As my hon. Friend says, her husband has kids. She pre-empts what I am going to say: this is not about women, but about parenting. One of the challenges for us is to support both parents to be equally culpable for the child that they have created, including looking after that child, because that is one of the things that would help women in the workplace. There is an impact on women’s earnings when they become parents, but there is not as much of a gap for fathers. For mothers the pay gap is 30%; for fathers it is around 10%. We also recognise from figures provided by the Office for National Statistics that having children can only account for a third of the variation in gender pay. One of the things we have to nail in this debate, if we are to close the gender pay gap and get that economic benefit, is the idea that this is all about having kids. A big chunk of the variation cannot be explained by childcare or caring commitments.
The second thing people say is, “This is about women putting themselves forward. Women do not ask for pay rises; women do not seek promotion; women do not want to be in charge.” Thankfully, we also have research showing that is simply not the case—that, as much as we might admire her in many other ways, Sheryl Sandberg is wrong. This is not about leaning in; this is about systematic discrimination against women in the workplace, as is clearly shown in an Australian study. Men and women ask for pay rises just as much as each other, but men are four times more likely to get one. That is the same for men and women of similar attainment or qualifications, and for men and women of certain ages. Let us stop blaming women for the gender pay gap, because it is not their fault; it is the fault of the environment they are working in.
That environment is what we need to tackle, and that is not just about getting a few more well-paid women at the top—although, if we are honest, we have seen over the past eight years that that is not going brilliantly either. Britain’s public companies will need to appoint women to 40% of their board positions over the next two years if they are to meet the voluntary target that the Government have set, and 100 companies in the FTSE 350 have either no women or just one woman on their board. However, if I am honest, it is not women at the top who I am really concerned about, because the vast majority of the gender pay gap is about low pay and women. It is about the value that we attribute to certain sectors, and the fact that those sectors are dominated by women. The silent majority in this country that we need to speak up for is not the women who we are going to see on the back page of the Financial Times. This is not about getting a few more women in top positions, although some companies have worked out that that would skew their figures; this is about the millions of women working in jobs that are systematically undervalued and underpaid.
We see a lower pay gap within low-paid industries, but we still see a pay gap. Over one in five female workers are low paid, earning less than two thirds of a typical hourly wage or just £8.55 an hour, compared with just 14% of men. That silent majority needs us to recognise that challenging the gender pay gap, and getting the better productivity and the economic benefits of doing so, comes about through how we think about those industries. It comes about through how we think about progression and flexible working within them, and not taking no for an answer; not thinking that this is somehow just about women being more confident or more articulate, or even a bit of anti-bias training, welcome though it would be.
My hon. Friend is making a fantastic and powerful speech. Some 80% of administrative and secretarial staff tend to be women, and when a construction company in my constituency of Midlothian went bust, the men who were the engineers and had the manual jobs found further employment quite quickly. However, the women who were in the admin roles did not, and found themselves unemployed. Does she agree that is another issue that is creating gender inequality in the workplace, on top of the gender pay gap?
Absolutely. One of the things I want to come on to is the rise in self-employment, and in particular how that affects a lot of women who have lost their jobs in industries where self-employment is now the norm. A lot of our equal pay legislation and gender pay work is out of date because of the way in which people are now working, and I would love to hear the Minister’s thoughts on whether we need an equal pay Act for the 21st century that can take account of what a comparator is for somebody who is self-employed. Certainly, for a lot of those women, that will be a live issue.
Equal pay is still a problem. The Equal Pay Act 1970 is older than I am, but we know that women are still facing basic problems in being paid the same as men to do the same jobs. We know that the 84% drop in the number of cases is more to do with the cuts in legal aid than with an end to the problem, as the legal cases involving the BBC and Asda prove all too well. However, the gender pay gap is not illegal; it is just immoral and, frankly, inefficient. That is the issue that we have to get right, because it is an issue that our competitors are getting right.
That is the third thing that I want to say to the Minister. We can argue about the data—I press her to improve the quality of the data we get with the second lot in 2019, because there is more we can do—but data is not enough. Indeed, the data and the reaction to it shows that people are quite comfortable with the idea that we should have a gender pay gap, in a way that they would not be comfortable with poor productivity in their firms. We have to change that culture, and when our competitors are doing that we have a real problem.
On the matter of culture, does the hon. Lady agree that the erroneous and inappropriate misuse of non-disclosure agreements is making a massive contribution to poor culture, with women particularly being silenced, resulting in the suppression and oppression of women and their voices in the workplace?
I absolutely agree. Indeed, that hostility to women’s voices being heard at all is one of the things that has come out of the #PayMeToo data. The fact that someone is powerful and has the money to silence someone else does not mean that that person’s voice should not be heard. I will support any of the measures on non-disclosure agreements that I know the Women and Equalities Committee is looking at, not just about sexual harassment but about harassment in the workplace, because it is clear from the data we are getting that women do not feel able to come forward and do not feel protected. Indeed, when we see the BBC—a major public employer—trying to silence women, what message does that send to women who want to talk about equal pay?
We can learn lessons from our competitors. We can learn from Iceland, which has brought in some very serious fines to make sure that there is enforcement of equal pay. It is no good having legislation if there are no real teeth to enforce it. In Germany, employees can now get the details of six of their colleagues’ pay so that they can do a direct comparison, which has had a big impact on changing conversations about the worth of women in the workplace.
However, I am also here to say to the Minister that time is up for asking nicely, because we have been asking nicely for some time for these issues around pay and progression to be dealt with, and the pace of change is glacial. When our competitors in Germany, Belgium, France, and elsewhere across the EU—even in California, for Christ’s sake, which is hardly a bastion of socialist public policy—are introducing quotas and recognising that pushing those quotas helps push the pipeline, the question for us is, “Why do we want to be left behind as a nation?” Left behind we will be, because even if we can struggle to get a few more women on boards to meet that target for 2020, we are not doing anything about that pipeline. We are not doing anything fundamental to ensure that the talent that exists on the shop floor that is currently underpaid is being picked up and fast-tracked. That would help change the country.
That matters because of the economic impact of failing to pick up that talent. It matters when we hear companies saying that when it comes to promoting women, “Most women don’t want the hassle or pressure of sitting on a board.” Of course, we know that women do not deal well with pressure, obviously. They say, “All the good women have already been snapped up. That’s why you can’t find them,” or, “We already have one woman, so that’s enough, surely.” Of course, all women can be represented by one woman on a board. They say, “Shareholders just aren’t interested in this issue.” Frankly, if shareholders are not interested, they are not watching the world or their bottom line.
A global analysis of more than 2,000 companies showed that companies with women in at least 30% of leadership positions had profits that were on average 15% higher. If shareholders are not pushing for and demanding change, clearly they do not want to make any money, but that is what is happening now. We can keep asking nicely and trying to improve the data, but even if we improve the data there is that comfort with having a gender pay gap that means our economy is going to be held back, and that needs to change.
We should be asking about part-time work and whether we need to lower the threshold, at least from 250 to 100 employees. We should hold to account those companies that try to avoid putting in their partnership data, and we should get the data on black and ethnic minority employment and disability within our workplace. But we should also make a commitment that we will act, and acting means doing what our competitors are doing. It means setting some clear targets and having consequences for those firms that fail to act.
We know that next April we might see data that is a little bit better. After all, they will have had a year to try to figure out how to game the system, but gaming the system does not get the economic benefit. Let us stop apologising for wanting to close the gender pay gap and start demanding that we do, because this country cannot afford not to. What will the Minister do to ensure that the data we get next year is better, clearer and more diverse? What does she think is the appropriate timescale to keep asking nicely? Will she commit to when we might bring in quotas if we do not see change? She will find friends and champions across the House if she does. I also know that if she does not, Britain will not get the productive workers it needs. Blaming women for the problem will not help our economy. Helping ensure that every firm, every public sector organisation and every charitable organisation makes the best use of its staff will give this country the brighter future that the Prime Minister claims she wants. We want more than one woman at the top; we want many. That is what Britain deserves.
I want to get to the Front Benchers by 5 o’clock. There is only one Member standing, but there is not much time in a one-hour debate.
Thank you, Sir David. I congratulate the hon. Member for Walthamstow (Stella Creasy) on securing this debate and on her speech, which she delivered with characteristic passion and peppered with huge quantities of data. I start by reflecting that the gender pay gap is at an historic low of 8.9%. We should acknowledge that, but also that it persists—we do not want it to persist; we want it to close and to end up without a gender pay gap—and that practically, most women’s incomes are still hit by having children.
When I was a new mum, I was lucky; I had a supportive employer that allowed me to work flexibly. It was working hard to encourage women to stay at work, having children, and to move up the organisation. I benefited from that, but I recognise that a huge number of women do not have that. In fact, only 11% of jobs that pay more than £20,000 are advertised with flexible working as an option, while the demand is estimated to be closer to 90%. That means that many women are not able to continue working in the job they were working in, and have to make choices that are not the ones they want to make. We know that by the time a couple’s first child is aged 20, mothers are earning on average nearly a third less than fathers.
Does the hon. Lady agree that one way we could stop some of these problems with the gap between men and women would be to pay men more to stay off work? If we gave men 90% of their pay for the first six weeks of their baby’s life, as we do with women, it might encourage a different atmosphere. Does she agree?
I will say a bit more about maternity and paternity pay later, but we absolutely must ensure that it is equally possible for men to take time off work when they become new dads, and that there is a more equal sharing of childcare responsibilities between mums and dads. One reason why that is not happening is that there are financial barriers to doing so.
I acknowledge the work that the Government are doing to tackle the gender pay gap. For instance, last year it was made mandatory for companies with 250 or more employees to report their gender pay gap. There was some speculation at the time as to the difference that would make, and that companies would not bother to comply. I imagine the Minister will confirm this, but my understanding is that there was 100% compliance and that companies did report it, even if it often did not reflect very well on them. That reporting is making a difference. I checked on what my previous employer was doing, because its reporting did not make it look that great. It did a whole report about the actions it was going to try to take to close the gender pay gap on the back of that reporting. If companies across the country are all doing that, that will make a difference. Now that we have had large companies do that, I am keen to see smaller companies do the same.
The headline point is that it makes good economic sense to close the gender pay gap. It makes sense for companies. We know that companies with greater gender equality do better. They perform better for their shareholders, it is good for their reputation and it helps them attract better candidates. When companies are struggling to recruit for the skills they want, clearly they need to ensure that they attract good women as well as good men. Greater gender equality also makes economic sense for the whole country. If we fail to make the most of the capabilities of women, we are failing to make the most of half the country’s workforce.
It is not just about women, however. Making things better for women has knock-on benefits for men, too. I know lots of dads who wish they had been able to spend more time with their children in the early years. Shared parental leave was introduced by the Conservative-led Government in 2014 to enable dads to do exactly that, but as Members have alluded to, there are barriers to men’s taking up paternity leave. There is more to be done to ensure much more equal taking up of maternity and paternity leave, to help dads play that greater role in their children’s early years and mums to keep their careers going.
I welcome the fact that the Government are looking at placing the onus on companies to assess whether a job could be done flexibly, and to make that clear when advertising it, rather than just relying on people—particularly women, but men too—coming forward asking for their job to be flexible. Anecdotally, I have heard that it is men who come across particular barriers when asking for a job to be flexible. We need to address that, too. I would also like to see greater transparency from large companies in publishing their parental leave and pay policies, so that they are absolutely clear to potential job candidates. There is a whole question around maternity discrimination, which we know is illegal, but is still pervasive. Too many women are forced out of work, whether that is having to take maternity leave early because they are pregnant, being made redundant while on maternity leave, or one way or another finding that they are unable to return to the workplace after having children.
Just to sum up, bearing in mind the time, I urge the Government to keep on pushing to close the gender pay gap. I urge them to keep pushing employers, business, the public sector and Parliament itself to do better.
In a one-hour debate, the mover of the motion gets the opportunity at the end to briefly wind up. I would appreciate it if the Front Benchers would give the hon. Lady that opportunity.
It is a pleasure to serve under your chairmanship, Sir David. I pay tribute to the hon. Member for Walthamstow (Stella Creasy), who delivered a characteristically eloquent and detailed speech. I hope that some of the statistics in it get picked up by the media, because they are so stark and so incredible. As she said, the Equal Pay Act 1970 preceded her entry into the world. Clearly legislation can be introduced, or repealed, as in the case of section 28, but that does not necessarily change culture.
It is the duty of any Government and their politicians to ensure that we introduce not only legislation that creates equality, but policies and cultures, and sometimes that requires affirmative action. I am somebody who is avowedly pro quotas. It would be interesting to hear from the Minister about Sarah Childs’s report on Parliament. Some of this must start from within. We must hold a mirror up to ourselves and ask whether we are doing enough as politicians, and within our legislatures, to ensure that there is gender equality, and equality across the board.
We are in the 100th year of women’s suffrage, but incredibly, when I was elected in 2015—I know that others in the Chamber were elected that year—there were more men in that Parliament than there had ever been female parliamentarians elected. We should never tire of reminding ourselves of that statistic. We have come a long way. We now have a rainbow Parliament of different cultures, with many people from black and minority ethnic communities, LGBT politicians, and politicians with disabilities, but we still have a very long way to go.
I want to pick up on some of the statistics that the hon. Member for Walthamstow mentioned. Some 60% of the British workforce work part time, but she eloquently made the point that women in lower-paid jobs in particular face inequalities. I met representatives of Asda recently, and discussed their equal pay challenge. In fairness to them, they said that they were trying really hard to address it, but the fundamental point was the difference between people who work behind the scenes in warehouses and those who work on the checkouts. Although one job involves more manual labour, the other involves much more emotional labour. That is the crux of the issue: do we really value manual labour over emotional or interpersonal skills and soft skills?
That is something that we sadly lack, across business and across politics. Think about the G20 photo in which Christine Lagarde and our Prime Minister were the only women. We have a global problem with patriarchal structures. It is not about attacking men and saying, “You’re rubbish, you’re not good enough, and you’re to blame for all the problems,” but there is a reality to be faced. If we have so little gender diversity, and so little diversity in the leadership of countries across the world, and collectively in an organisation such as the G20—if only two of those 20 people are women—then we have serious problems.
That brings me to the financial sector. The Independent Evaluation Office, an arm of the International Monetary Fund, published a really interesting report about the run-up to the financial crisis. The report said that two key failures led to the almost complete failure of the regulatory system: No. 1 was groupthink and No. 2 was a reluctance to speak truth to power. The reality was that in the run-up to the financial crisis we had largely men around the table, largely from similar backgrounds, who were unwilling to challenge each other and challenge the groupthink that ensued; and that eventually brought our financial system to its knees.
It is scarcely necessary to open any financial paper any day of the week to see that, Brexit aside, we are heading for another financial crisis. I agree with the hon. Member for Walthamstow that we should not always couch the argument in financial terms, but we must tailor our message to those who are listening. I was heartened that when the data was released, Martin Gilbert, the chief executive of Standard Life Aberdeen, said:
“I’m welcoming new gender pay gap regulations despite the uncomfortable reading.”
We need to take men with us. We need men to come on the journey.
The hon. Member for Faversham and Mid Kent (Helen Whately) spoke about paternity and maternity leave, and I agree with so much of what she said. I hope that we can work cross-party on this issue, because men need to have the opportunity to take the time that they would like to take with their partners, to be with their children. They are parents as well. So often we hear men referred to as “baby-sitters”. They are not baby-sitting their own children; they have an equal responsibility.
Very often, having a missing parent of either gender, in terms of that parent being in the workplace, brings about huge challenges and issues for children. I am from a single-parent family. My mother worked full time, and she did a pretty decent job. I know she found it challenging. Whatever make-up a family is, in our modern society we must ensure that our structures encourage those families, and that every workplace, whether in the public or private sector, encourages families to flourish and staff to take the time that they need with their children.
In Scotland, we passed legislation in January 2018 to ensure that we have 50:50 gender representation by 2020 on our public boards. Our gender pay gap is smaller in Scotland; it is only 6.6%, as opposed to the UK gender pay gap of 9.1%. Our First Minister, Nicola Sturgeon, has done an incredible job, but in Holyrood we still have significant challenges. Interestingly, the gender representation of the press Lobby in Holyrood is much worse than that of the UK Lobby. That is also an issue. They are the people who report on our politics and help to shape the political arguments. I look up at the press Lobby every week at Prime Minister’s Question Time, and there is a serious lack of diversity, particular regarding gender. We must do everything that we can to close that gap.
The World Economic Forum predicts that it could take 217 years to close the gender pay gap. That is an incredible amount of time. We should not have to wait any longer. We must act, and what I always say to folk when I talk about quotas is that, as much as people may have problems with them, they are a temporary measure to redress the balance. They are not something that any of us want to see over the long term, but whether in politics or in business, they are absolutely the kind of policy that the UK Government and devolved Governments must introduce so that we can have fair representation.
I finish by quoting Talat Yaqoob, the director of Equate Scotland, who said:
“What we can be hopeful of is that the demand for fair representation is growing. Lobby groups, academics and women in parliament will, rightly, be vocal about the need for progress. But the evidence of women’s under-representation, the reasons for that under-representation and the positive impact more women in parliament have, is all well documented. The time now, is…for action. By the next election, we can and must have processes in place for fair representation.”
None of us knows when the next election may come, so now is the time to act. I hope that the Minister will be on board, and on side with us. I am sure that we will be able to work together on these issues to close the gender pay gap, and to ensure that our businesses, our Parliaments, our shop floors and our warehouses are representative of our society.
It is a pleasure to serve under your chairmanship this afternoon, Sir David. I congratulate my hon. Friend the Member for Walthamstow (Stella Creasy) on securing the debate. It is always great to collaborate with her on the work that she does on women and equalities to try to move the agenda forward.
We have heard some really great speeches today. I think we are almost in agreement that something needs to be done; I suppose it is about how it will be done, and when it will be done. Labour introduced the Equal Pay Act in 1970, but nearly 50 years later we are still discussing unequal pay, and women are still earning less than men. I loved the fact that on 10 November a lot of women put “out of office” messages on their email to show that they work for nothing from that day onwards. I thought about doing that myself, but the consequences would probably have been rather different.
We are still talking about the pay gap. The UK has slipped from 14th to 15th in the ranking of 33 OECD countries based on the five indicators of female economic empowerment. We really need to do better. There is a lot that we can and should do, so there is no excuse for not addressing the problem. After all, 51% of people in the country are women and the other 49% would not be here it were not for women. It is time we made those adjustments rather quickly.
Women have borne the brunt of Government cuts—87%—and everywhere we turn, women are struggling and suffering. My hon. Friend cited some really stark statistics that show that things are continually getting worse. Sometimes there are marginal gains, but they are really far too slow to work. The gap is at its lowest for women aged 18 to 21; I would call that good news, but the gap opens up significantly—to around 26%—for women in their 50s. What could that possibly be down to? Obviously it is a combination of sex and age, and we know that if we add race into the equation, the gap widens.
We need to take into consideration what is at the heart of the gender pay gap: discrimination. A lot of injustices globally are caused by the undervaluing and devaluing of women and the roles they play. The hon. Member for Livingston (Hannah Bardell) mentioned the issue of manual versus mental labour, which really drives home the point about the jobs women do, the roles we play and the way we are talked about. Our body, our hair, our looks, how we speak, how we walk—all those are additional barriers that men often do not face.
We really need to think intersectionally and look after other women who do not look white or middle-class or have kids. If we are really going to move the agenda at the pace it needs, we have to think about all women, in the round, so that we are not still having this discussion in 50 years’ time. Tackling these issues should be the Government’s main priority. I have sat opposite the Minister many times, and I know that she will say that the Government have done this report and that audit—but audits and reports are just not enough, because they are not getting the job done. We need solid action.
Hon. Members may ask, “What would Labour do?” We will ensure better provision of parental leave and more affordable childcare. We will encourage women and girls to go into male-dominated sectors so that they can achieve high salaries. We will also look at mental versus manual labour—I quite like that concept, so I might nick it from the hon. Member for Livingston.
The hon. Lady is very welcome to nick it; we can share it and make it a cross-party tag line. Does she share my concern about comments from chief executives—particularly in the aviation industry, which has one of the worst pay gaps? Ryanair said that its gender pay gap of more than 70% was just because more men are pilots. We must call that out, but we must also encourage the industry to do more and work with organisations such as the Civil Aviation Authority to make sure that we have more female pilots and better support for women to get into such roles.
I absolutely agree. It is easy to reverse those roles; it is a proven fact that women are very calm under pressure, which is one of the traits that pilots need. There is an organisation in the airline industry—I cannot remember which—in which the woman who is chief exec is making great strides in encouraging women to become pilots. Why not? And why not equalise things the other way by having more male cabin crew? I totally agree that silly excuses are made. Men continue to dominate the most senior and best-paid roles. I know that that will take time to change, because they may have been in the job for a while and discrimination has being ongoing for years, but there is no excuse—we must tackle equality.
The Equality and Human Rights Commission estimates that 54,000 mothers a year are forced to leave their jobs early because they are pregnant. It is outrageous that that figure exists. To address such deep-rooted inequalities, we must ensure that we mandate that employers put action plans in place. It is great that employers now have to tell us their gender pay gaps as a result of regulations made under the Equality Act 2010, but they need to do more—just telling us that there is a gender pay gap without doing anything to address it is not enough.
The Government could do more. They could say—as a Labour Government would—that if an organisation pays its employees well and has an agenda to close the gender pay gap, they will ensure that it has access to Government contracts. If not, it should not get a Government contract, because it does not deserve one.
There is so much to be said, but I know that time is short and I am sure that hon. Members from all quarters of the House will secure more debates on the subject. It has been said that it has been very difficult to win the hearts and minds argument on the gender pay gap because companies are often not interested—they just ask what the bottom line is. However, my hon. Friend the Member for Walthamstow cited a figure of £150 billion that closing the gender pay gap could generate for our GDP. That figure fluctuates, but without a doubt, paying women well will ensure that we add billions to the economy.
It is a pleasure to serve under your chairmanship, Sir David. I congratulate the hon. Member for Walthamstow (Stella Creasy) on securing the debate. We all know how committed she is to this important issue and to gender equality generally. It is a pleasure to discuss it with her in this forum, as it is to meet her behind the scenes to try to get things done.
I also thank other hon. Members for their contributions; I am delighted that so many strong women contributed. I was particularly delighted that the hon. Lady seemed to describe my right hon. Friend the Member for Wokingham (John Redwood) as a unicorn—she said there were discussions about unicorns in the main Chamber and he was on his feet at the time. I will treasure that comment and keep it close to my heart.
This year has been one of milestones: data from the Office for National Statistics shows that the gender pay gap has fallen to a record low; more than 10,000 employers have published data for the first time under the new reporting regulations; and the pay gap became one of the biggest news stories of the year. Those are all indications that the issue has climbed up the agenda, which we know is being translated into conversations in industry and business. People are finally talking about this injustice.
I recently met some senior businesspeople who run some of the most powerful businesses in the country—indeed, the world—to discuss modern slavery. One of them told me, “I was at a meeting in New York recently and, in a room full of investors and businesspeople, we talked about the gender pay gap regulations in the UK.” It is not just us in this country who are having this conversation about the regulations and the injustices they have revealed; other countries and businesses around the world have noticed too. We are under no illusions that this is just the first step, but it is still a huge step forward. Employers across the country are now aware of the challenge that they face, and we are committed to supporting them and tackling the issue together.
I want to start by discussing the women who are perhaps most affected by gender pay gaps—those who are the lowest paid—which is an issue raised by the hon. Member for Walthamstow. The emphasis has tended to be on well-paid women and on directorships, because we want to get the symbolism right and put the message out there that women can run businesses and so on.
I commend the Government’s record on trying to narrow the gender pay gap. It was a pleasure for me to address female electricians in this place on Monday. One of the top issues that came up in discussions with them was the engrained workplace cultures that really curb female progression. Can the Minister update us on what she is doing to solve that?
I was at the same event, and a female electrician corrected me by saying that only 1% of electrical engineers are female. As in our earlier discussion about pilots, there is no reason why more electricians and electrical engineers should not be women.
Let me turn to the work we are doing to help the lowest paid. The Minister for Women and Equalities, my right hon. Friend the Member for Portsmouth North (Penny Mordaunt), recently announced that the work of the Government Equalities Office will be broadened to include an explicit focus on low-paid, low-skilled women, who have often been left out of the conversation, despite possibly requiring the most support, given the multiple barriers they face. The message that she wants to give, and which I echo, is that this is not a question of forgetting about directorships or the highest-paid women; this is about multitasking and ensuring that we reflect the whole economy and women’s contributions to it. We know, for example, that the lowest-paid women tend to feature in four industries: retail, childcare, caring and cleaning. We are looking at those sectors to ensure that the figures for the gender pay gap translate into real-life policies that have the greatest impact for the lowest-paid women.
The shadow Minister mentioned some figures quoted by the OECD. She will have to forgive me—obviously I am doing this on my feet—but just to put them in context, we understand that the OECD figures use a different methodology and go much wider than our gender pay gap measures. We are working with colleagues across Whitehall to increase women’s economic empowerment. In terms of Government recruitment, those factors are very much taken into account when we look at contracts. I hope that reassures her.
I turn now to the drivers of the gender pay gap. This is clearly just one of the steps we are taking to tackle the gap; other steps include introducing shared parental leave and pay, and running a £1.5 million campaign to promote the scheme. Hon. Members have made the point about fathers wanting to play a much greater part in raising their children, particularly in the early years. I think there is a lot more that the scheme can and should do. We want to raise awareness of it, so that employers understand the regulations and can ensure that their male employees can contribute to family life in as powerful a way as their female employees do.
I thank the Minister for her extremely positive contribution, which I know will be followed with actions. I have spoken to a number of male constituents who have asked their employer about paternity leave and received quite negative responses. Education and engagement with businesses across the UK is important in enabling men to take paternity leave without facing stigma and discrimination as a result.
The hon. Lady raises a very important point. This is about changing conversations and attitudes in the wider society as much as it is about what we do in this place, which of course is important. Frankly, it is about ensuring that society modernises the way it treats men and women in the workplace. We know that some employers are better than others. I hope that employers who are not doing such a great job will recognise the business reality: given the choice, good people will not want to work for bad employers. This is very much part of us all contributing to the conversation to ensure that employers know how they should treat their workforce.
There is more to supporting people in the workforce. In addition to shared parental leave, we are extending the right to request flexible working. We are creating a £5 million fund to support returners and spending about £6 billion on childcare support by 2019-20. We know that closing the gap will require a collaborative effort from Government and businesses, but I am convinced that, to truly solve this, employers must be the driving force. Every single employer who was supposed to have reported has done so, which means that 10,500 businesses are having conversations—sometimes for the first time—about how they treat women in their workforce.
I absolutely accept what the shadow Minister and others said about the need for action plans. As she knows, we take a slightly different approach to this. I want businesses to come up with their own action plans—indeed, we understand that about 40% of eligible employers have done so. I want to bring businesses with us, but if in due course that does not happen, that option remains open. At this stage, we want the transparency created by reporting figures to be met and addressed further by businesses doing that for themselves through their action plans.
Will the Minister consider fining companies that refuse to make action plans or change their way of working, as is the case in Iceland?
That is an interesting idea. As I said, I want to work with businesses on this. The figures suggest that they are getting the message, but we are all impatient for action and for pay gaps to be closed, so that is a very interesting thought.
I am drawing towards the end of my speech. I am conscious of the time and want to give the hon. Member for Walthamstow a minute, so if I may, I will canter through some of the other points raised. Hon. Members have rightly raised the issue of extending the regulations. We have had only one year of reporting, and I urge them to allow us a little more time to assess the impact of the regulations. We need to consider any changes fully, given the impact on the comparability of the data year on year. We want a foundation of data before considering whether or how to change the current requirements. I am conscious of the wish to lower the threshold at which employers have to report. Again, let us have a couple of years of reporting at the higher level and with big companies, which have human resources departments that can deal with this, with the hope that it trickles down—which I know it is—to smaller employers as well.
In order to give the hon. Lady time to respond, I will end by saying that we know that pay gaps are not restricted to gender. That is why the Prime Minister announced a consultation on ethnicity pay reporting in October, setting out a number of questions that need to be resolved to allow meaningful action to take place. We are mindful of those aspects of fairness in the workplace.
I am grateful to the hon. Member for Walthamstow for this fantastic chance to reflect on a truly momentous year on this agenda, and I am extremely grateful to her for her continued interest in this issue.
I do not have long. I had asked the Minister whether she would consider the Government Equalities Office doing its own survey of the direct experiences of women of the impact of the data. I again make that plea to her. It is absolutely no use us talking about that here without the data. We did that through the #PayMeToo campaign, which I hope the Government Equalities Office will look at. We know that 9% of organisations submitted data with impossible outcomes; there was 1% with bonus payments of essentially more than 100%, which does not make any sense. There are questions about the data.
The Minister talks about 40% of companies having action plans, which means that 60% do not. We could have several years of trying to refine the data, but fundamentally, women in this country are being underpaid, and our economy is suffering as a result. Please, Minister, do not think that this is just about trying to explain to Ryanair that you do not, frankly, need a penis to fly a plane; this is about what drives change. If it is not quotas, it is not asking nicely—that is what the data tells us. I really hope that she will recognise the change.
Motion lapsed, and sitting adjourned without Question put (Standing Order No.10(14)).