Before we come to Prime Minister’s questions, I am sure the whole House will wish to join me in paying tribute to John Angeli OBE, Director of Parliamentary Broadcasting, who is leaving the House service at the end of this week. During his 12 years as director, John not only oversaw the expansion of live video coverage to all public proceedings, but delivered the hybrid capability which enabled Parliament to function during lockdown and, of course, made history with President Zelensky being beamed into this Chamber. He has more recently brought live subtitling and British Sign Language to our proceedings. I am sure I speak on behalf of the whole House in thanking John and wishing him all the best for the future. [Hon. Members: “Hear, hear!”]

(Urgent Question): To ask the Secretary of State for Environment, Food and Rural Affairs if she will make a statement on the financial resilience of the water industry.

Water is what makes life possible on our planet, and it is essential for our health and wellbeing, as well as for our economy, including the production of food and clean energy. The Government are taking significant steps to ensure that the water industry is delivering the outcomes that bill payers expect and deserve. Water companies have invested £190 billion since privatisation in 1989. In April, the Government published the plan for water, bringing together more investment, stronger regulation and tougher enforcement capacity for regulators in relation to those who pollute.

Ofwat and the Government take the financial resilience of the water sector very seriously. Ofwat is the independent economic regulator for the water sector and has responsibility for its financial resilience. The sector as a whole is financially resilient. Ofwat continues to monitor the financial position of all the key water and waste water companies. Ofwat reports annually on the sector’s financial resilience, and Ofwat’s latest annual monitoring financial resilience report shows that the water sector is financially resilient.

Market confidence in the sector is demonstrated by new acquisitions, such as Pennon’s purchase of Bristol Water, and by shareholders being willing to inject new capital. Ofwat has taken steps in recent years to strengthen the sector’s position. That includes action to update the ringfencing provisions in water company licences to better safeguard the interests of customers, and barring water companies from making payouts to shareholders and removing money or assets from the business if they lose their investment grade credit rating. Ofwat has outlined that water companies must be transparent about how executive pay and dividends align to the delivery of services to customers, including environmental performance. Since privatisation, total capital investment has outstripped dividends by 250%.

On 20 March 2023, Ofwat announced new powers that will enable it to take enforcement action against water companies that do not link dividend payments to performance for both customers and the environment. In December 2022, Ofwat strengthened its powers on executive pay awards by setting out that shareholders, and not customers, will fund pay awards where companies do not demonstrate that their decisions or pay awards reflect overall performance. We support Ofwat’s work, and we urge all water companies to take this opportunity to review their policies.

The scale of Government commitment to the water industry is highlighted by the integrated plan for water, and by our commitment to the financial resilience of the sector in delivering for customers and the environment.

Thank you, Mr Speaker, for granting the urgent question, but it is a concern that the Secretary of State did not proactively make a statement to the House on an issue of such importance. Indeed, where is the Secretary of State? One of the largest water companies in Britain is potentially going to go to the wall, and the Secretary of State is missing in action.

It was clear to anyone looking on that a culture that allowed vital investment in ending the sewage scandal and tackling water leaks to be sacrificed in favour of a goldrush for shareholders was never sustainable. Just last year, as raw human sewage was being pumped out across the country, £1.4 billion was paid out to shareholders. Now, all that was warned about is coming to pass: leaks are leading to water shortages; sewage dumping pollutes our rivers, lakes and seas; and the only thing on the up is debt, at £60 billion. The Conservative party’s cycle of privatising profit, usually for multibillion-pound foreign sovereign wealth funds, and nationalising risk is not sustainable, and neither is it a fair deal for working people.

The news we are seeing is the result of the Conservative party’s failed “profit above public interest” experiment, in which it handed over the water industry at a knock-down price to private enterprise, together with the entire infrastructure serving the nation. That was almost unique to water. For instance, when rail was privatised, the tracks were not sold off. With water, however, the lot was handed over, with few safeguards for our national interest, our national security or bill payers.

When was the Minister’s Department first made aware of the financial situation at Thames Water? Has her Department had any reason to believe that those responsible at Thames Water would not be able to meet their licence conditions or legal obligations? If this means a taxpayer-funded bail-out, how much will that cost and how will it be paid for? What assessment has she made of the liability of UK pension funds that are invested in Thames Water, and in other water companies considered to be at risk? Given where we are, will she confirm her confidence in the financial regulator? Finally, given what we see with Thames Water today, does she have concerns about any other water companies, or does she consider this to be an isolated case?

In the Department for Environment, Food and Rural Affairs, we have our individual portfolios, and I am the water Minister. The Secretary of State has full confidence in her Ministers when sending them to the Dispatch Box.

The shadow Minister raised the issue of debt. For information, debt to equity fell last year by 4% in the water industry, actually making it more resilient. Since privatisation, capital investment in the water industry has been 84% higher than it was pre-privatisation—we need to get that out there and on the table.

In terms of Thames Water, it is not for me to comment on the individual financial position of a water company. We have an independent regulator that is doing that; indeed, that is what the regulator, Ofwat, is for. Water companies are commercial entities, and it is for the company and its investors to resolve any issues. The Government, of course, are confident that Ofwat, as the economic regulator of the water industry, is working closely with any company that is facing financial stress.

I call the Chair of the Select Committee.

Sewage treatment plants are all too often overwhelmed at times of heavy rain. As well as installing stormwater tanks, such as the new 4 million litre stormwater tank in Scarborough, does the Minister agree that we should do more to encourage homeowners to harvest grey water, which can buffer the effects of heavy rain, and use that for such things as flushing the toilet?

I thank my right hon. Friend for broadening the scope of the debate. We are in discussions with the Department for Levelling Up, Housing and Communities—many of these issues involve working with other Departments—on grey water harvesting and better using the rain that does fall. A farmer in Devon whom I visited was collecting all the water from his farm buildings roofs to supply his animals.

In assessing, as the Minister has explained, the resilience of the water industry, what assessment is she making of the impact on UK pension funds if a major company such as Thames Water fails, as is being widely suggested in the press?

There is a structure and a process for working through this matter. It is up to the individual water companies and the regulator working with them to ensure that they are resilient. That is why Ofwat reports annually on how resilient each water company is. If that flags any issues, Ofwat works closely with them, because we need our water companies to be fully functioning. We need to attract investment—a huge sum of money has been invested since privatisation, as I mentioned earlier—in infrastructure to give our customers the kind of service they deserve. We should also be mindful that it is not all piled on to customers; we have to share the load.

It is worth making the House realise that it was the Opposition who voted against the Environment Act 2021, which gave Ofwat more powers. Can my hon. Friend assure me that the water regulator Ofwat will be able to clamp down on excessive cash payouts and ensure that water companies put their customers first?

I thank my hon. Friend for pointing that out. He is absolutely right: whatever the Opposition say today, one of the measures they did not vote for in the Environment Act 2021 was to enable Ofwat to hold water companies to account where they do not demonstrate a link between dividends and performance. They must have sound performance and be performing for their customers, otherwise they cannot pay out their dividends.

The staggering complacency we are hearing from the Minister will come as no comfort to my constituents who were flooded out three years ago in the west London floods, which were the second 100-year event in less than a decade. If Ofwat has been doing such a good job in holding the water companies to account, as she is now apparently telling us, why are we in this situation? What exactly has Ofwat been doing?

It has to be remembered that privatisation occurred in 1989. We have had a succession of different Governments during that time, and it has been this Government who have accelerated clamping down on water companies and opening up transparency. The hon. Lady asks what Ofwat has done, and I will name just a few things. Since 2020, Ofwat has updated the licences so that if a water company loses its investment credit rating, it is barred from making payouts to shareholders. In July 2022, it set out additional proposals to increase financial resilience, including companies having a stronger credit rating. In March, it announced that it would take enforcement actions against water companies that do not link dividend payments to performance. We have done more than any Government before to ensure that we have a fully functioning, strong regulator.

On financial resilience, has the Minister taken the opportunity to consider the hotchpotch of policies coming from Opposition Front Benchers on the subject? Under their prescription, they would seek to take all the profit of water companies to invest in capital expenditure. That would undermine the financial resilience of those companies that rely on private capital for investment in tackling this problem. In the one part of the country where Labour does have responsibility—Wales—has she noticed that the sewerage overflows are almost double the rate per overflow pipe as in England?

I thank my right hon. Friend for pointing that out; I cannot support more strongly what he said. We have a private system, and Ofwat says that it is financially resilient. We need investment in these companies to make them function properly. Obviously, we need to hold the companies to account, but we need to see enormous investment. Everything in the Government’s plan for water, including the storm overflow discharge reduction plan, is fully costed. We are not pulling the wool over people's eyes; we are telling them clearly what this will mean and how it will deliver the water services that we need.

Thames Water, which is on the verge of going under, provides a quarter of the population with their water supply. When was the Minister told about its financial plight? What is the plan if the worst comes to the worst and it does go under?

The hon. Member is right that Thames Water supplies an enormous part of our population. Ofwat has been working closely with Thames Water, as it does all water companies, and the Government work with Ofwat, giving it our strategic policy statement on what its priorities will be. Overall, the water companies are considered resilient, and much work is going on behind the scenes with Thames Water to ensure that customers will not be affected. If necessary, there is a process in place to move us to the next stage.

Swindon residents will be concerned about the future of Thames Water, so I ask my hon. Friend please to keep me and colleagues updated on any issues relating to that. Underlying this issue, Labour’s model will clearly never work—we must understand that only the private sector will be able to invest. [Interruption.] Labour Members bleat now, but they did nothing about it when they were in government. Is the point not that where we have in effect a private monopoly, the regulator must be as effective as possible? Will my hon. Friend do everything possible to ensure that Ofwat is working in the full interests of customers? Aspects of its operation do not seem to pass that test.

I thank my right hon. and learned Friend. Thames Water is a big water company that delivers on a wide scale. Ofwat is working very closely with the company on its plans, which will be looked over and submitted, and accounts will be submitted in due course, so that we have a resilient pathway. Customers, including his constituents, should rest assured that both their water and wastewater supplies will be protected.

This privatised industry knows that, at the end of the day, the banker of last resort is the British taxpayer. That is exactly where we are with Thames Water, which has been taking profits for the last 35 years and not investing for the future. Regardless of what went on before, we must have investment in what is in front of the industry, but Thames Water has failed to plan ahead. It has taken money but not done the job expected of it while being in charge of such an essential public service. What will the Government do to protect consumers and ensure that we plan ahead for the industry?

Ofwat is the independent regulator and, as the hon. Member will know, the Government direct it through the strategic policy statement. It is Ofwat’s job to ensure that in the price review, when the water companies submit their plans—they are going over the draft plans now—they demonstrate that they will deliver on the Government’s targets on storm overflows, leakage and demand reduction. It is for Ofwat to ensure that companies will be resilient in delivering that infrastructure. There is a firm structure in place. Ofwat also constantly monitors companies’ gearing—debt-to-equity—levels, and the Government are confident that the regulator is taking reasonable measures to challenge companies to reduce those gearing levels where appropriate.

About a quarter of the country’s economic output is in sectors under regulators, including the water industry. With Ofwat and in other sectors with Ofgem and the Financial Conduct Authority, we have seen regulators not performing to the standards that the public, or indeed industry, would expect. If we are honest, we in this House and in Parliament do not have the toolkit to assess regulators’ performance on a systemic basis year in, year out. Will my hon. Friend work with ministerial colleagues to see whether we can improve the regular oversight of regulators such as Ofwat so that we can take a more rounded view on such issues, rather than have them come through urgent questions as brought by the Opposition?

I thank my hon. Friend for that. It is essential that we have fully functioning regulators. Since the Government came to power, Ofwat has done an enormous amount to streamline what it does, improve transparency, change licences and make changes so that dividends are not paid if any environmental damage is being caused. The Government have directed that through the strategic policy statement. Indeed, our targets will ensure that the regulator enables the water companies to put the right measures in place. He is right, however, that one should never be complacent, and if things need to be improved through the regulators, they should happen. But I assure him that a big effort is being made.

Many of my constituents are hugely worried about reports of Thames Water being on the brink and what that could mean for their bills. Thames Water has been managed appallingly: leaks have not been dealt with, sewage has been continually dumped and the former chief executive officer Sarah Bentley needed to be asked to forgo her bonus. All the while, the Government have been missing in action. Why are the Government yet again running to catch up—nothing in the Minister’s statement gives confidence that they have a grip—with our constituents paying the price?

Where water companies underperform and do not meet their targets, a process is in place whereby basically they have to credit the money back to their customers. Last year, £143 million was credited back in that respect. So the regulator does have the tools to do that. It has tightened up so many of its measures, all of which will affect all the water companies.[Official Report, 10 July 2023, Vol. 736, c. 1MC.]

The Minister will not be able to comment on Thames Water’s finances in detail, but can she assure my constituents, who will be really worried, that, whatever happens, their day-to-day services will be protected and the much-needed upgrades will still be delivered?

I thank my hon. Friend for that. He is right that customers come first, and Thames Water customers will be assured their water supplies and wastewater services. I am happy to meet him to discuss that.

Residents in Twickenham, Teddington and the Hamptons will be extremely worried to hear that Thames Water is on the brink of collapse, but they are also fed up to the back teeth with this company. Not only does it pump sewage into our precious River Thames, but recently we have seen sewage flooding our streets at times of flooding from rainfall, and there are now plans to pump treated sewage into the Thames at times of drought. That is indicative of the company’s underinvestment in fixing leaks and being stripped to the bare bones while lining executives’ pockets. All the while, the Government have been missing in action and the regulator has failed. Will the Minister back the Liberal Democrats’ proposals to reform water companies into public good companies, transforming their boards and priorities in the interests of the environment and consumers?

I will highlight the Thames super-sewer—it will be ready to open in the not-too-distant future—which is a tremendous project for the people of London, including many of her constituents. We have a privatised system, whose financial resilience, as I have reported, has increased rather than decreased in the last year. These companies attract money from investors so that we can get what we need. The Government have costed plans. The Liberal Democrats have no costed plans for what they suggest they might do with the water companies, nor plans for where the money will come from.

It is worth pointing out to Opposition parties that 93% of all UK coastal bathing waters meet good or excellent conditions. In North Norfolk we have lost three blue flag beaches, which went from excellent to good. But guess what? There is not a single reason why they lost that flag. Under the Environment Agency’s marking, it looks like it is down to not combined sewage overflows but entirely natural phenomena. Could the Minister help me get my blue flags back and hold the Environment Agency to task, to ensure that it has a proper testing regime that transparently shows that we have excellent bathing water quality all over North Norfolk?

I thank my hon. Friend for raising the issue of bathing water quality. Since privatisation we have virtually the best quality water coming out of our taps of almost anywhere in the world. We also have phenomenal results for our bathing water areas—93% are classed as good or excellent. He has concerns about his area, but I hope those beaches will soon be back up to blue flag status. The Environment Agency works closely on individual cases where concerns have been highlighted. I am happy to put him in touch with the Environment Agency or work with him to find out what those individual cases were, so that we can get those beaches back up to the fantastic standard that they deserve.

Today, not for the first time, most of my constituents have little or no water supply. Two years ago, not for the first time, hundreds of my constituents had their homes flooded with raw sewage. Year after year, Thames Water has failed its customers while obscenely rewarding its management and shareholders. No one will miss the asset strippers at Thames Water if it goes under. All we want is working infrastructure and good customer service at a reasonable cost. Is that too much to ask?

That is what we want for all our customers. That is why we have launched our plan for water to pull everything together to ensure that we deal with any pollution incidents, water supply issues and the future of the water industry. It is why we have set our targets and produced our storm sewage overflow plan, and why the water companies will have to spend £56 billion on capital investment by 2050 to address that. Every water company, including Thames Water, has to make an action plan for each of its storm sewage overflows. Thames Water will do that.

When they were privatised, water companies had all the debt written off, so they started with zero. Since then, they have borrowed £53 billion, much of which has been used to help pay £72 billion in dividends. The investment has been made by borrowing and putting it on to customers’ bills. Now, the ratings agency S&P has negative outlooks for two thirds of the UK water companies it rates, because they are over-leveraged and took out too much debt in an era of low interest, which they now have to pay back. This is not a triumph but a huge problem for the resilience of our water industry. What will the Minister do when water companies start falling over?

For information, Thames Water itself has not paid any dividends for the last six years. Ofwat will rightly hold companies to account when they do not clearly demonstrate the link between dividends and performance. We made that possible through the landmark Environment Act.[Official Report, 10 July 2023, Vol. 736, c. 2MC.]

I want to bring the Minister back to the figures we have just heard. Water companies had no debt when they were privatised. Since then, they have borrowed £53 billion, and much of that has been used to help pay £72 billion in dividends. Meanwhile, we have an appalling sewage scandal, particularly in the south-east of England. The failing company Southern Water, which my constituents have no choice but to rely on, is considering raising bills by £279 per year by 2030, largely to pay for the investment that it should have been making in previous years. Does that not show that the privatisation of water was a serious mistake that needs to be permanently rectified?

Privatisation has enabled clean and plentiful water to come out of our taps. It has unlocked £190 billion of funding to invest in the industry. That is the equivalent of £5 billion annually, and is double what we had pre-privatisation. I am not saying that there is not still a lot of scope for improvement. I have stood at this Dispatch Box many times, as has the Secretary of State, to say that some actions of water companies are completely unacceptable. That is why we have introduced the storm overflow plan and our plan for water.

As two Members have said, funding and loans to the water companies are a huge issue, as that is where they have paid their dividends from. On shareholders, we have foreign investors taking huge amounts of money away from this country, and we need better fund managers who are able to assess where they put their money. They should be held accountable, too.

Ofwat has not been doing what it is supposed to do. I believe that the chief executive of Ofwat applied for a job at Thames Water. That shows what the companies are doing and how Ofwat works with them—rather than scrutinising them, people are looking for the next job. We have to stop that and stop my constituents paying more for water. They need decent water in their homes and in the environment around them. That is what we want the Government to ensure. This Tory policy has failed for years.

I am not sure what the question was. We want the same things: value for customers, and clean and plentiful water. We want to hold the water companies to account. We want them to invest the money needed to deliver the right services. That is why we have a plan for water, our targets and the measures in the Environment Act. It is why the regulator Ofwat has taken all the actions I mentioned to increase the transparency of water companies and to ensure that money is not being paid out if there is any environmental impact or performance negativity.

In the last year, a number of my constituents on the Westfield estate have had their homes and gardens flooded with raw sewage. Yorkshire Water accepts that it is its sewage, but does not accept responsibility to help with the clean-up. Will the Minister look at the legal position to ensure that water companies are held accountable? In the meantime, we should put pressure on Yorkshire Water and others to pay for the clean-up that my constituents are having to fund themselves.

The hon. Gentleman will know that we have put huge pressure on the water companies, which now have to invest £56 billion in infrastructure to deal with sewage issues. If he wants to meet me to talk about that issue, I will be happy to.

Back in January I asked the water Minister whether she thought that the current system of regulation was fit for purpose, and she said yes. I ask her again: does she still think that it is?

Yes.

Water companies were sold with no debt when they were privatised in 1989. In fact, they were given a £1.5 billion green dowry by the Government. Since then, they have taken on borrowing of £60.6 billion, diverting income from customer bills to paying dividends and interest payments. As a result, water bills have increased by upwards of 40% in real terms. Does the Minister honestly think that consumers hail privatisation as a success?

Ultimately, the customers pay for investment in the industry, but over a very long period, as the hon. Lady will know. If a company did not pay out dividends it would struggle to get access to finance to fund future investment. That would limit the level of investment and have an impact on future customers. Companies have to pay up front for a lot of that investment, because they need to secure a large amount of funding to pay for it. To avoid customer bills increasing drastically to pay for that, companies have to secure the money by raising debt or equity. She knows how it works. The regulator has to ensure that that system is fully functioning, the water companies are resilient and we have all the resilient water supply that we require.

It has been reported that the companies are drawing up their business plans for 2025 to 2030 and that, on average, they are looking at a 25% increase in bills. Given what we have heard today, would billpayers in my constituency not think that rather than paying extra to water companies, they may as well just flush their money down the drain for all the good it will do to improve water quality, services and investment in infrastructure?

All those plans are being assessed right now. The draft plans go to Ofwat, where they are analysed with a fine-toothed comb. All the things I have mentioned today will be scrutinised, so that we can deliver the infrastructure that is needed and have the clean and plentiful water supplies we require as well as a clean and healthy environment, with no undue impact on customer bills. All those things have to be taken into account to deliver the water supplies that the people we meet and the people we serve deserve.

The British public should not be asked to cover the cost of failures by the water monopolies and their shareholders. They have borrowed extensively to pay dividends while failing to make necessary investments in infrastructure and resilience. Does the Minister agree that if the Government are compelled to take Thames Water into public ownership, it should stay in public hands?

I am not aware of the situation the hon. Gentleman is referring to. Ofwat is working very closely with Thames Water to ensure that the business is viable, that customers are not impacted, and that water supply and waste water services are delivered. As I mentioned, Ofwat has strengthened many measures so that we have a much more resilient industry in the future. Indeed, those changes and the fall in the debt to equity ratio demonstrate that we do have a more resilient industry.

We have seen bonuses and dividends put ahead of investment in infrastructure or maintaining sufficient reserves. Our area of Devon and Somerset is covered by South West Water; the company has paid out £112 million in dividends this year, despite having just £144 million in reserves, which is £2.5 billion less than it had two years ago. This week, a water firm chief executive officer has resigned, but no Conservative Minister has ever taken responsibility. When will a Conservative Minister finally take responsibility and get a grip, or step aside?

As the hon. Gentleman knows, Ofwat has announced new measures to enable it to take action against water companies that do not link dividend payments to performance. That is just not happening. I think he needs to look again at some of the stats he has just quoted, because I think they might relate to the wider Pennon Group. I have just visited South West Water to have a really forensic look at its systems and how it delivers water. That is what we do with our water companies. It is Ofwat’s job to hold water companies to account, and it has just got measures through the Treasury so that it has another £11.3 million to tackle enforcement.

I thank the Minister for her answers. We are ever mindful that house building is important, and development opportunities are critical to the future as well, so with developers being charged more and more to connect to the network but facing delays in those connections being installed, what plans does the Minister have to make the connection system for new developments more affordable?

The hon. Gentleman raises an important issue. We always have be mindful of costs, not just to customers through their bills but to developers building houses. We are working closely with the Department for Levelling Up, Housing and Communities on a range of measures and on its planning guidance, so that we can tackle a range of issues connected to water, working with developers on things like rainwater harvesting and sustainable urban drainage systems, which will really help the whole of our water infrastructure.

On a point of order, Mr Speaker. I think the Minister may have inadvertently misled the House. She said clearly that Thames Water has not been paying out dividends. The reality is that Thames Water has not been paying out dividends in the usual way, but it did pay dividends last year to the parent company, so it has been paying out dividends.

Does the Minister wish to respond?

Yes, Mr Speaker. I will check the wording, because I would hate to mislead the House. If I have inadvertently said something incorrect, I will happily put it straight on the record.

Right.

With permission, Mr Speaker, I would like to make a statement on improving safety in mental health in-patient services across England. Before doing so, I want to thank all the right hon. and hon. Members from across the country who have campaigned tirelessly on behalf of their constituents to improve mental health care. Too many people have experienced care in mental health in-patient settings that has been well below the high standard that we all deserve when we are at our most vulnerable. I would also like to put on record my sincere condolences to the families and friends of those who have lost their lives.

First, I will update the House on the independent inquiry into mental health in-patient care across NHS trusts in Essex between 2000 and 2020. I thank my right hon. Friend the Member for Chelmsford (Vicky Ford) for tabling a Westminster Hall debate on the Essex mental health inquiry earlier this year. She and colleagues, including our hon. Friend the Member for Rochford and Southend East (Sir James Duddridge) and our right hon. Friends the Members for Witham (Priti Patel) and for Maldon (Sir John Whittingdale), all spoke passionately about the need to get justice for patients and their families. I know that my hon. Friend the Member for South Suffolk (James Cartlidge) also tabled an Adjournment debate on mental health in-patient care in Essex before the independent inquiry was launched in 2021.

I also pay tribute to my right hon. Friend the Member for Saffron Walden (Kemi Badenoch) and my hon. Friends the Members for Clacton (Giles Watling), for Brentwood and Ongar (Alex Burghart), for Castle Point (Rebecca Harris), and for Southend West (Anna Firth) for their determined campaigning on behalf of their constituents. Of course, we should all remember the important contribution of the former Member for Southend West, and a great friend to many across this house, the late Sir David Amess. He tabled a Westminster Hall debate on mental health services in Essex back in 2014, and he was a passionate campaigner for improving mental health care. I know he is very much in our thoughts.

In 2021 we launched the independent inquiry to investigate the deaths of mental health in-patients across NHS trusts in Essex between 2000 and 2020. The Government appointed Dr Geraldine Strathdee, a former national clinical director for mental health for NHS England, to chair the inquiry. I want to place on the record my thanks to Dr Strathdee and her team, because a lot of good work has been done. I applaud the bravery of all the victims and their families who have come forward to tell their stories.

I also recognise the work that the Essex Partnership University NHS Foundation Trust—EPUT—has done to assist with the inquiry. The trust has been in the spotlight, and progress has already been made to learn lessons and improve in-patient mental health care. EPUT’s chief executive, Paul Scott, joined in 2020, and since then the trust has invested £20 million in its mental health in-patient wards and a further £20 million in community services. Compared with 2019, patients absconding from care has decreased by more than 60%, and the use of inappropriate restraint has fallen by 88%.

However, in January Dr Strathdee raised concerns with me about a lack of engagement with the inquiry by current and former EPUT staff. I know that many right hon. and hon. Members share her concerns. Since then, the inquiry and the trust have worked together in a concerted effort to increase staff engagement. None the less, I have listened to Dr Strathdee’s concerns that the inquiry still needs further staff engagement to get victims’ families the answers they deserve. In a letter to me in March, she said that

“30 percent of named staff, those essential witnesses involved in deaths we are investigating, have agreed to attend evidence sessions. In my assessment, I cannot properly investigate matters with this level of engagement.”

She has also raised with me concerns about ongoing safety issues at the trust. To quote from her letter once again, she said:

“I am very concerned that there are serious, ongoing risks to patient safety. Due to the nature of these issues, I am confident that these cannot be properly investigated by the Inquiry without statutory powers.”

The Government take both concerns extremely seriously, and I agree with Dr Strathdee that we have now reached the point where the only appropriate course of action is to give the inquiry statutory powers.

Statutory inquiries do take longer, but this does not mean that work will start from scratch. Dr Strathdee’s existing findings will inform the next phase of the inquiry. She has informed me that, owing to personal reasons, she will not be continuing as the inquiry’s chair, so I want to thank her once again for all her commitment and hard work. I am sure the House will agree that she is a true public servant. Our work to find her successor is proceeding at pace, and I will update the House on the progress of setting up the inquiry in due course.

I recognise that Members’ concerns about mental health in-patient facilities are not confined to Essex. The Government are committed to improving mental health care across England, which is why we are boosting mental health funding by at least £2.3 billion this year compared with four years ago, why we are making urgent mental health support available through 111, and why we are delivering three new mental health hospitals to provide specialist care and cut waiting lists.

In January, we commissioned a rapid review of how data is used in in-patient mental health settings in England. More effective use of data has the potential to reduce duplication, ensuring that healthcare professionals can spend more of their valuable time with patients. The review team—well led again by Dr Strathdee—heard from more than 300 people representing every part of the in-patient mental health sector, including former patients and frontline staff. Dr Strathdee has made recommendations for how data and evidence can be used to identify risks to patient safety and failures in care more quickly and effectively. The findings and recommendations of the rapid review will be published today, and I will deposit a copy in the Libraries of both Houses. The Government will consider its findings carefully and respond in due course.

We recognise, however, that patients and families want to know how their concerns will be taken forward as soon as possible, and I also recognise that a wide-ranging statutory inquiry relating to other settings, or covering multiple patient safety issues, would not deliver those answers quickly. My Department has therefore agreed to work alongside the Healthcare Safety Investigation Branch to prepare for the launch of a national investigation of mental health in-patient services, which will commence in October, when the HSIB receives new powers under the Health and Care Act 2022.

The new Health Services Safety Investigations Body will investigate the following themes: how providers learn from deaths in their care and use that learning to improve services, including post-discharge services; how young people are cared for in mental health in-patient services and how that care can be improved; how out-of-area placements are handled; and how to develop a safe staffing model for all mental health in-patient services. Across all those areas, it will explore the way in which providers use data. I want to reassure the House that the new body will have teeth and will work at speed, that it will have the power to fine those who refuse to give evidence when they are required to do so, and that its predecessor’s investigations were typically concluded within a year.

I hope that today’s announcements will be of some comfort to the bereaved families who have done so much to raise awareness of the failings of mental health care in Essex and elsewhere. I want them to know that the Government are committed to obtaining for them the answers that they deserve, and to improving mental health across the country. I commend this statement to the House.

I call the shadow Minister.

I thank the Secretary of State for advance sight of the statement. However, it beggars belief that it has taken the Government so long to address the House on this matter. It seems that every month there are new scandals regarding needless loss of life and dehumanising behaviour in in-patient mental health settings. That must be stamped out now—these are people’s lives.

That brings me to the subject of Essex Partnership University NHS Foundation Trust. I welcome the announcement today that the inquiry will be given vital statutory powers, because for several years families who have lost loved ones at the trust have been calling for the inquiry to be given those powers. The grieving families I have spoken to have told me about the pain and anguish they have felt during their fight for answers, and that has only been compounded by an inquiry that lacked the necessary powers to seek the truth.

I must pay tribute to those families for their tireless campaigning and effort. In particular, I thank Melanie Leahy, who has fought for too long to achieve the announcement that has finally come today. I hope that Melanie, and every other family, will now start learning the truth.

Dr Strathdee has been a powerful advocate for the Essex inquiry, and we want to express our thanks to her for the work that she has already put in. The next inquiry chair must continue her work, and hold the confidence of the families who have been impacted in Essex.

I have repeatedly called on the Secretary of State to give the Essex inquiry statutory powers, and I am pleased to see that he has finally listened to our calls, but why were families left in the lurch for so long? Following months of scandals in in-patient mental health hospitals, public confidence is falling. More than one in three people say that they do not have faith that a loved one would be safe if they needed hospital mental health care, but every patient must be treated with dignity. I have repeatedly asked Ministers whether they have visited failing trusts. The Minister refused to answer, so will the Secretary of State commit himself to greater transparency? The Secretary of State has announced that urgent mental health support will be made available through 111, but 1.6 million people have been left languishing on waiting lists for mental health treatment, their condition deteriorating and reaching crisis point.

It is welcome that we will finally see the publication of the rapid review today—better late than never—but Labour has been calling for in-patient mental health settings to be reviewed in the light of these serious failings, and any rapid review should have had patient voices at its centre rather than being simply the data exercise that the Government commissioned. When we look at the planned national investigation into in-patient services that they will conduct alongside the Health Services Safety Investigations Body, we see that, yet again, there is no mention of working with patients and their families. Where is the learning? Where is the focus on what staff need in these settings? Are the Government looking at additional training needs, given that mental health care relies on staff and not simply on shiny equipment?

Let me turn briefly to the planned consultants’ strike, about which the Health Secretary has said absolutely nothing. Yet again he has been missing in action. For my consultant colleagues to have voted to strike is extraordinary, and the risk to patients of seven days of strike action is intolerable. Next week marks the 75th anniversary of the NHS, and it has never been in a worse state. The country is clear about who is to blame. It is not nurses, it is not junior doctors, it is not consultants, and it is not paramedics; it is this Conservative Government. They have lost control of the NHS, they have lost the confidence of NHS staff, and they have lost the support of the British people. The only ballot that we need now is a general election.

It is a shame that the hon. Lady chose to conclude her remarks in such a way. Let me address that head-on. It is bizarre to accuse a Minister who is literally at the Dispatch Box of being missing, particularly when the shadow Health Secretary, having managed to turn up for Prime Minister’s Question Time, has failed to turn up for this statement. It is even more bizarre that, although we are constantly told that the Labour party sees parity between mental health and physical health as a key priority, when it actually comes to debating the issue, the contrary is clearly on show.

This debate is not about the issues normally raised during Prime Minister’s questions about the politics of the day; it is about the families who have tragically lost loved ones, about how we can learn the lessons from that, and about how we can ensure that we get the data right, get the support for staff right, and get the procedures right so that other families do not suffer loss. We have responded to the excellent points made by Dr Strathdee through her rapid review about data. There are two elements to that: there is data that is collected that does not add value, is often duplicative and takes staff away from giving care—that is somewhere that we can free up staff—but there is other data that is needed to better identify issues early, and we need to look at how we improve that data. Specific issues arose in respect of engagement by staff, and we have actively listened and responded to the concerns raised by families and by many Members of the House, particularly about the Essex inquiry. I will come on to those as I go through the wider issues.

The shadow Minister mentioned speed. Of course, there is a balance to be struck between the completeness of a statutory inquiry and the greater speed that is often offered by other independent inquiries. Indeed, the Paterson inquiry was a non-statutory inquiry commissioned through the Department, and that is another vehicle that is often successfully used. There are also inquiries commissioned through NHS England, such as the Donna Ockenden review. There is often a balance to be struck between those inquiries, given the speed at which they can proceed, and a statutory inquiry, which has wider powers but often takes longer.

It was because of our desire to move at pace to get answers to families that we initially commissioned a non-statutory inquiry, in common with Bill Kirkup’s inquiry into Morecambe Bay and inquiries into many other instances in the NHS. However, we have listened to families and to right hon. and hon. Members who have raised concerns about the process and, in particular, the engagement by staff, and decided to make it a statutory inquiry.

The shadow Minister asked about our commitment to transparency. The very reason that we set up the rapid review in January was to bring greater transparency to the data. That is why I will be placing in the Libraries of both Houses the outcome of the rapid review. That speaks to the importance of transparency as we learn the lessons of what went wrong in Essex and in other mental health in-patient facilities.

The shadow Minister made a fair point about waiting times. We are committed to cutting waiting times, including in mental health. That is why we are spending £2.3 billion more on mental health this year than four years ago, we have commissioned 100 mental health ambulances, we have 160 different schemes looking at things such as crisis cafés to support people in A&E, and we have schemes such as the review through 111 and the funding the Chancellor announced in the Budget for mental health digital apps to give people early support. Of course, that sits alongside other mental health interventions, such as our programme to train more people to give mental health support in schools.

The shadow Minister made an important point about working with families. I agree with her about that. HSIB will be meeting families—indeed, Ministers have been doing likewise—and we are keen that that should feed into the terms of reference, both for the statutory inquiry and for the HSIB review.

We have touched on consultants, but let me make a final point on that. As far as I am aware, the Opposition do not support a 35% pay rise, whether for junior doctors or for consultants, but if that is their position, perhaps they will tell us whether this is yet another area that the stretchable non-dom contribution will reach to. Exactly how will it be funded?

This is a serious issue. The measures that we are taking address the concerns of families who have suffered the most tragic loss. It is important that we learn the lessons, both in Essex and more widely. We have actively listened to the points raised by Dr Strathdee, who has done a fantastic job. It is right that the work moves on to a statutory footing, but it is also right that we look more widely at the lessons from other mental health in-patient facilities. That is exactly what we intend to do.

First, let me put on the record my personal thanks to the Secretary of State and Ministers for their honest and frank engagement with colleagues and with bereaved families, whose concerns they have listened to. It was my constituent Melanie Leahy, who was at one stage a constituent of my right hon. Friend the Member for Maldon (Sir John Whittingdale), who brought the issue to our attention and to the attention of the Secretary of State. She deserves a lot of support for the way she has conducted herself. None of us would want to go through the sheer anguish and personal trauma that she has experienced. We owe a lot to her and to others who have come forward.

There are still 80-plus families who did not engage with the inquiry led by Dr Strathdee, to whom I pay tribute. The statutory inquiry will give them the confidence and courage to come forward, speak up and share what will be—we should be frank about this—deeply harrowing evidence. Will the Secretary of State expand on how evidence received by Dr Strathdee’s inquiry will be treated? I know that he said he will come back to the House on the processes. We are interested, in particular, in the inquiry’s terms of reference. Importantly for bereaved families, what measures will be in place to support people to come forward and give evidence? There have been too many barriers in that regard for families and, if I may say so, those who have been employed by EPUT. What involvement will the families have in drawing up the terms of reference? They are the ones that need confidence in the process. Again, I thank Dr Strathdee, and I thank the Secretary of State and Ministers for their engagement.

In my discussions with my right hon. Friend and colleagues, I found the compassion that they showed and the way they championed the family voice compelling. I absolutely agree that it is important that families take confidence from the decision to move the inquiry on to a statutory footing and come forward with their evidence. I know that she plays an active part in that. Of course, we want families to be part of the discussion on the terms of reference. I know that, with her significant experience, my right hon. Friend is keen to be part of that too, and we are keen to engage with her on it.

My right hon. Friend is right to highlight the evidence that has already been gathered through the excellent work of Dr Strathdee. I had a meeting with her yesterday to ensure that we capture that as part of the work that is moving forward. I hope—I reinforce my right hon. Friend’s point—that families will take confidence from today’s announcement and that those families who have not come forward to date will be able to do so. I know that in my right hon. Friend they will have a resolute champion supporting them to do so.

I, too, welcome the Secretary of State’s statement, but I am disappointed that he did not say more about the serious risks that we have raised in the House—not least about timely access to services and the significant risk that many of my constituents have faced out in the community—in respect of Tees, Esk and Wear Valleys NHS Foundation Trust, which serves York. I wonder whether he can expand on that, and on his proposals for taking things forward at the trust. I am meeting one of his Ministers next month, but I would like to hear his position on addressing the serious concerns that have been raised.

The hon. Lady raises a very valid point. There are real concerns about Tees. We considered that when considering the scope of the statutory inquiry. Given that significant work had been done in Essex, we decided to strike the balance by putting that on a statutory footing but enabling work to proceed at pace through HSIB on Tees and some other areas. The hon. Lady will know that the Care Quality Commission prosecuted the trust in May for a regulation 12 breach, and that significant work has already gone in; the report of the system-wide independent investigation was published last March. They are very serious issues on which I think there is concern across the House, and we stand ready to work with her and other elected representatives from that area as part of the wider work.

It is a deep, deep tragedy that, over the 20-year period, around 2,000 people lost their life under the care of mental health services in Essex. Families and survivors are right to want transparency and accountability. Given the slow progress of the independent inquiry, it is right that it now moves to a statutory basis.

When I spoke in Westminster Hall, I shared the testimony of a constituent who had been an in-patient in the early 2000s. She described being raped by another patient and being laughed at by staff when she asked for support. She described being able to make many suicide attempts, absconding from the ward and overdosing. She described how staff refused to treat her self-harm injuries and how she was repeatedly restrained and forcibly injected. I put on record my incredible respect for the people who are coming forward to relive their horrors and share their testimony. They are doing this because families and survivors want to know that change is embedded so that lives are safeguarded now and in the future. Will my right hon. Friend give assurance to my Essex constituents that mental health services in Essex will now be given the support they need to keep vulnerable people safe?

Having discussed that harrowing evidence with my right hon. Friend, I do not think any Minister could either forget it or not be moved. I found it an extremely moving experience to hear her talk about the experiences of a number of her constituents. She is right to praise those who come forward, and to recognise that it is often a difficult ask to relive the most awful circumstances, but it is important that families come forward so that we learn lessons and ensure this is not repeated.

My right hon. Friend is also right to highlight the two broad elements of learning the lessons of what happened in the past and maintaining services for the future. I am therefore happy to give her an assurance that we will work closely with her on support for Essex as lessons are learned through the statutory inquiry and as services continue to be delivered. We are working closely on that with the chief executive.

My thoughts are, first and foremost, with the bereaved families and all those involved, because this process must be utter agony for them. It is right that the inquiry is put on a statutory footing.

In his statement, the Secretary of State quoted from a letter he received from Dr Strathdee, in which she said:

“I am very concerned that there are serious, ongoing risks to patient safety.”

The Secretary of State did not expand on that, and I do not know whether he is able to do so. If I may extrapolate, we know that, more broadly, there are risks to patient safety when there is not enough workforce and when there are not enough beds. Hertfordshire is the most under-bedded area of the country. When we see the workforce plan, potentially this week, will it include estimates of the number of qualified mental health staff we need in in-patient settings, NHS community settings and schools? Will he meet me and my local mental health trust to discuss the number of beds we have in the county and our plan to expand them?

Dr Strathdee did not particularly focus on staffing numbers, as far as I recall; she focused on some of the issues with care from staff. That was the nature of the concerns. On the ongoing risk, part of the reason why we commissioned the rapid review was to look, in particular, at the quality of data. There was a quantity of data that was not effective, and that often distracted staff from spending time with patients. There were also gaps in the quality of data that needed to be filled, and the document that will be placed in the Libraries of both Houses speaks to that point. That is why we are so keen to move at pace on learning lessons.

I welcome that sentence and the seriousness and speed with which this is being taken forward.

As a now non-practising consultant psychiatrist, I have a variety of declarations in this area, which are best summarised in the pre-legislative scrutiny report on the draft Mental Health Bill. My constituents are waiting for the rebuild of the Abraham Cowley unit in my constituency, but the framework under which patients are looked after is very important. People in in-patient settings are, by definition, some of the most vulnerable people looked after by the NHS, and a fair proportion are a detained population. Could the Secretary of State update the House on how soon we will see the Government’s response to the pre-legislative scrutiny Committee report on the draft Mental Health Bill and when we expect the proper Bill to be brought forward?

My hon. Friend is right to highlight the importance of pre-legislative scrutiny, into which he had a personal input. I am hugely grateful for his work and the work of Baroness Buscombe and others. I met Baroness Buscombe some months ago to discuss the outcome of that pre-legislative scrutiny. I do not have a date to share today, but I am happy to write to my hon. Friend with a further update.