Tuesday 18 October 2016
[Mr David Nuttall in the Chair]
Concentrix: Tax Credit Claimants
I beg to move,
That this House has considered the performance of Concentrix in dealing with tax credit claimants.
This is the first time that I have spoken in a debate in this Chamber that you have chaired, Mr Nuttall, and I look forward to it.
Just hours after I successfully persuaded the House of Commons Backbench Business Committee to table this debate, Concentrix’s contract was ended. I called for this debate because the company has bullied people who depend on tax credits and targeted single mothers, many of whom have had their tax credits stopped without fair notice. Concentrix is paid by results, which means that it has a financial incentive to stop payments. Its decisions are frequently made on the basis of wrong information, and people who depend on tax credits to make ends meet have been left without funds for weeks while errors have been corrected, causing hardship for them and their children.
I thought that this debate would focus on those shocking failures, and that I would use the time to share how the lives of my constituents, and the constituents of many Members here, have been made miserable by the cavalier way in which Concentrix has used the flimsiest of excuses to end tax credit claims, and by its shocking customer service, which has left claimants hanging on to telephone calls for hours without resolution. However, since then, there have been many parliamentary opportunities to highlight such stories. I am glad that the pressure from me and other MPs has led the tax authorities to end Concentrix’s contract. I am particularly glad that the National Audit Office is to look into its operation. As a former member of the Public Accounts Committee, I am confident that the NAO will get to the bottom of whether Her Majesty’s Revenue and Customs or Concentrix is responsible. I think it possible that we have sometimes blamed the company when we ought to have blamed the Government.
I congratulate my right hon. Friend on securing this important debate. Concentrix took the approach of stopping payments without warning. Many single mothers in my constituency have told me that they discovered that their payments had stopped only by checking their bank accounts. Does she agree that HMRC should not have given Concentrix the authority to stop payments, and that the process must stop?
I think that the best thing that we can do with this debate is ensure that lessons are learned from this failure, and that the whole Government act on them. It is time to get answers from the Treasury about the extent to which it, rather than Concentrix, is responsible for the failure.
My right hon. Friend has done a great service in securing this debate. I had a problem, to say the least, over Christmas with a family who had no income for about eight weeks. We spent most of the Christmas period trying to get that family some money. Does she not agree that these matters should not be farmed out to private companies? They are far too sensitive. The Government should have another look at this, and the responsibility should be taken in-house. It should also be noted that HMRC has taken on another 30 staff; that is one heck of a cost as well. Another company that should be investigated is Capita, which is doing exactly the same thing because it has been set targets.
My hon. Friend is right that we need to work out what Government should do. I will deal with that point later, but it is clear that part of the problem with Concentrix is that if people were notified, they often did not believe what they were told, because the Treasury insisted that Concentrix use its own branding on the letters, so people got letters from some company asking for extensive data. I would have treated that as phishing and thought, “This is someone trying to scam me.”
I congratulate my right hon. Friend on securing this debate. She is absolutely right that we need to learn the lessons from this mess. Many of my constituents have been left in utter financial disarray by having been left for a time with no income. Does she share my belief that we need reassurances from the Minister that the Government will take every step necessary to sort out this shambles and help those who have been left in a mess?
Indeed. Not only that, but the Government ought to ensure that it does not happen again. There is a risk that it could, not just in the Treasury but in other Departments. The reason why I persisted with this debate after the Treasury abandoned the contract is that I believe that this is an opportunity to learn lessons that should be spread throughout Government.
My right hon. Friend is right to point out that this is not just a failure of practice by Concentrix but a policy failure by Government. The deliberate intention of the contract was clearly to target single parents, on the basis of assumptions that they were living with a partner and not reporting it. That is an acute, intimate and sensitive issue, and it is important in such cases that practice is handled with great care. There is absolutely no evidence of such care. This is returning to the attitude that single women bringing up children must not be respectable and need to be investigated. Surely that is something that the Government need to rethink and re-learn.
My hon. Friend is absolutely right. It was a gendered contract, and the Government did not stop to think—or maybe they did think about it, and thought that women in such circumstances should be blamed. All Members here will know that their constituents feel harassed, scared and pinned up as targets as a result of how things have been done. It is not acceptable in a civilised society to treat mothers in that manner, and it is mothers who have been treated badly.
I agree that the majority of my constituents who have been in touch are single mothers, but single fathers have also been affected. One constituent who came to me looks after two children and works 16 hours a week, and he received no money for six weeks. Ultimately, it is the children in those households who suffer. The Government must ensure that this does not happen again.
The right hon. Lady is being extremely generous in giving way, and we are all grateful to her. I had a case in which a single mother was accused of living with a former tenant who had moved out in 2014. Does the right hon. Lady not agree that although issues must be investigated, to do so on the basis of allegation, without evidence, and to stop payment, is not really a satisfactory way for Concentrix or anyone else to operate?
The hon. Gentleman is absolutely right. I will try to make some progress, so that he can see what I want to say about that kind of issue. Decisions were certainly made on the basis of inadequate evidence, in a way that I believe was actually illegal under the Tax Credits Act 2002, and should not have been permitted.
My right hon. Friend is being extraordinarily generous. I have had many cases in which precisely that has happened. Single mothers in Wallasey have been accused of living with a previous tenant in a house that they happened to rent at a particular time—allegations so absurd that they had not even thought of them. Their benefits have often been stopped for weeks and weeks, and they have had no access at all to funding, which has forced many of them to go to food banks. What kind of Government allows that to happen?
My hon. Friend is right that we need to focus on the responsibility of the Government, because that is what we Members of Parliament can most influence. The first lesson for the Government is that payment-by-results contracts should be avoided. Concentrix staff were under pressure to perform—we are told that they were expected to open 40 to 50 new investigations a day—so they regularly proceeded on totally flimsy evidence.
I spoke to Concentrix about the source of the evidence it received, because I could not really believe that a company would proceed on the basis of such information —“Somebody else once rented this flat”, “The electoral register has this person on it”, “Someone has had their post sent to this address,” and so on. The director of Concentrix told me:
“HMRC provide Concentrix with the claimant cases that they believe qualify for review.”
So the source of the evidence is HMRC. He continued:
“These cases are selected by HMRC based on its own internal system which flags where there may be the potential for fraud or error. There were 1,497,000 cases provided from the Authority based on their initial assessment of risk or error and fraud.
Concentrix subsequently runs a further series of checks to substantiate the potential risk of fraud and error and to refine the list of cases that are then checked. In the latest campaign, Concentrix deselected 80% of the cases originally provided to us by HMRC. This means we contacted 324,000 and the remaining 1,173,000 were not worked by Concentrix.”
According to him, HMRC even pressed Concentrix to investigate cases in which it could not name the alleged co-resident.
We have been blaming Concentrix for using flimsy evidence when I think that the source of that flimsy evidence is actually HMRC. My first question to the Minister is: where is the so-called evidence sourced from? Is it the Post Office, credit agencies or out-of-date electoral registers? Is it true that the Treasury pressed Concentrix to pursue cases with so little data that the alleged co-resident’s name was not even known? When tax credit claimants were written to about the investigation of their case, the alleged co-resident was not named in that letter. Many of my constituents have said, “How can I prove a negative?”. Of course, if they had got through on the telephone, they would have been told the alleged co-resident’s name, but getting through on the telephone was not straightforward, as we all know.
I remind the Minister that section 16 of the Tax Credits Act 2002 gives the power to amend or terminate an award where there are reasonable grounds for believing that an award is wrong or that there is no entitlement. It also gives the power to request information or evidence where there are grounds for believing that the award might be wrong. That law is clear. It was confirmed in an Upper Tribunal judgment by Judge Wikeley that the burden of proof for stopping a tax credit award lies with HMRC, but that was reversed in these cases: the authorities proceeded to close claims without reasonable grounds that they could evidence. They demanded excessive evidence from applicants who sought to disprove allegations that they had claimed the wrong amount for childcare or were living with an unnamed partner.
I raised the important question of Concentrix back in February. One of my vulnerable constituents, a single mother of three, was put on trial and lost her tax credits for six weeks over Christmas, only to be informed that she had no case to answer. I ask the right hon. Lady to join me not only in condemning the practices of Concentrix, which she is doing more than capably, but in calling on the Government to renounce this terrible, abhorrent practice entirely.
The point is that if we do not manage to get answers from the Minister, we will end this contract but will be walking into the risk of future contracts making the same kind of mistakes, including targeting single mums in a way most of us find completely unacceptable, and breaching the law that provides the power to end benefits and so on. This situation really is not tolerable, and it is up to us to ensure that it never happens again in any aspect of Government administration.
I am grateful to the right hon. Lady for raising this important issue. I, too, have constituency cases with which I could regale this Chamber. Does she agree that there is a fundamental danger in a model that has a private organisation, which is accountable to its owners and has a duty to make profits for them, providing a public service, where the accountability must be to the public and the first duty must be to provide the public with a full and proper service?
The hon. Gentleman is right. Civil servants are trained to conform with the law. How can Ministers ensure, in this contract or in any future contracts, that there is not a parallel reinterpretation of the law by a private company? When the Minister was informed about the Wikeley judgment, as I hope he was, what did he do to ensure that all future decisions would conform to the law? Civil servants are generally trained in a culture where the law is the guide to how they work; I am concerned that Concentrix staff were not operating within such a culture. There is a real risk of letting out similar contracts in future that do not operate within such a culture.
Does the right hon. Lady agree that the problem is not just with this contract but with all results-based contracts in which there is essentially a commission? Atos was under a similar contract and we all know the terrible damage it did to sick and disabled people. Although it is welcome that we are ending the Concentrix contract in May 2017, the UK Government now need to stop all such contracts and fundamentally review the entire process.
The hon. Gentleman is right that we should stop such contracts, but we also need to find out the extent to which there has been a failure of policy underlying the Concentrix contract. I agree that the very nature of the contract—having a private company asking for those details—was inappropriate. So was the payment-by-results aspect, for example, and the fact that when the company was under pressure there was no way of bringing in civil servants to help by answering the telephone and so on. Such problems are inherent in that kind of contract, but some of the difficulties must have been created by the way the Treasury and HMRC operated. They provided the company with totally flimsy evidence and suggested it should be investigated. In effect, they ran a campaign against parents who were doing the terribly difficult job of bringing children up on their own. We should be ashamed of ourselves for targeting that group of people, who are resilient but in some ways vulnerable. The job of broader society is to help them in their task of bringing up the next generation.
Many claimants received a letter requiring council tax records, a year’s worth of bank statements, pay slips, childcare costs, divorce papers and household bills. Many people, as I would have done, treated such requests from a private company as probably a phishing exercise by a fraudster. Those people discovered within 30 days that their conclusion was an expensive mistake: their tax credits were stopped. All my constituents who had their tax credits stopped eventually had them restored.
I stress that it happened eventually. It was often after hours on the telephone and the intervention of my staff. Those hours on mobile phones cost an enormous amount for some of these people, who at the time had no money to speak of apart from the meagre wages they earned from their part-time jobs.
I thank my right hon. Friend for securing this important debate. My constituent’s tax credits were stopped erroneously. She was down to her last £5 and was told to send in documents by recorded delivery. She had to decide whether to feed her children or send the documents. The Government really must rethink their policy and respond to such people, so that we know it will never happen again.
The problem is that the Minister and his civil servants cannot imagine what it is like for someone to have to choose between feeding their son or daughter and posting an important letter that will get next month’s money in. They cannot imagine a parent having so little money that that is the choice they face. When people’s tax credits were stopped, they were eventually restored. Although they can get additional bank charges and so on paid back—I have managed that on behalf of constituents—they often cannot redeem their credit history, which makes the rest of their life more expensive, so there are serious long-term consequences.
Does my right hon. Friend agree that the Government should reconsider the situation wherein, in the face of error by Concentrix, my constituents were asked to apply for a mandatory reconsideration of the decision? That is disgraceful. The fault was not theirs.
Indeed, and if we look at the figures for mandatory reconsideration we can see that it is overwhelmingly decided that our constituents were in the right and the decision makers in the wrong.
It is striking that the process was also expensive for those who complied. As my hon. Friend the Member for Dewsbury (Paula Sherriff) pointed out, sending precious documents by registered post costs money, as do printing inks. People also have to pay fees to have documents reissued. Yet in every case HMRC had initially decided that the application was justified. We are not talking about initial applications for tax credits; we are speaking on behalf of people who are trying to continue to receive them. The burden of proof has to be on HMRC.
My right hon. Friend is making a vital point. Several of my constituents were asked by HMRC to prove a negative—something that was not, in fact, the case—and had no way of doing so. Some of the people they were accused of living with were not alive.
Indeed. There is an important principle in the UK’s administrative law that public authorities act on the basis of evidence and law, and that if they dispute someone’s claim, they should have a good reason. The HMRC charter says that people have a right to be treated as honest. Well, the lone parents who were targeted did not feel that they had that right. Nearly a third of claimants applied for a mandatory reassessment, and they were overwhelmingly successful. Will the Minister guarantee that in future the Government will put acting legally before getting money out of citizens who do not have any? That is the question at the heart of this debate: illegal action has screwed money —excuse my language—out of citizens and damaged their ability to do their main job, which is to look after their families.
HMRC implies that the reason for dropping the contract is a sudden decline in the level of customer service, in particular the backlog of 200,000 incomplete cases and the terrible performance of Concentrix’s telephone service. Concentrix responded by saying that the case numbers were far above predicted rates. In August this year, they were nearly five times the forecast rates, which were developed by HMRC. One contributor to the backlog was HMRC’s automatically terminating 45,000 cases—guess when? In the week beginning 8 August. Where do mums and dads go in that week? They go on holiday, because it is the only time they can take their children on holiday, because otherwise they are at school. The Government have form when it comes to sending out such letters and starting consultations at the beginning of August. If the Minister can say that one of the things he is going to do is ensure that this nastiness in August will end, I think we would all be pleased to hear it.
Why were the predictions of the number of cases so brutally wrong? Why was the letter sent out on 8 August to terminate all those cases on the grounds that they had not fulfilled their information returns? In management terms, it would be more sensible to spread such a policy across the year, so that when someone does not respond to an information return they get a notice at the time. I do not believe that all the cases were started in August. I do not believe that thousands and thousands of people made their first tax credit application in the week beginning 8 August, yet so many of their cases were terminated in that week, causing extreme chaos in a situation that was already brutally chaotic.
It seems to me that the discovery of a service failure just after I sought this debate and just after the Department was called before the Work and Pensions Committee does not bear looking at. A cursory look at Mumsnet web chats, at the Child Poverty Action Group’s advice logs or at all the letters that the Minister and civil servants have received from MPs would have made it clear that the company’s performance has been unacceptable for a long time. Will the Minister ensure that any new contracts with private companies will permit a swift end if performance is substandard and ensure that the Government get information about the standards that are achieved in a timely fashion?
The current contract states that if Concentrix delivers less than 97% accuracy, its commission will be reduced, but I have discovered that in this case accuracy does not mean making the right payments to the right people; it means jumping through the hoops devised by HMRC. Let us have a real definition of accuracy, which is that the right payments should go to the right people and should not go to the wrong people. We all accept that people should not be paid tax credits wrongly, but accuracy must be judged on the real results, not on some process that is extremely burdensome.
I am concerned about the fact that, as my hon. Friends have said, the burden has particularly hit women and mums. What equality impact assessment was done at the start of the contract? We know that David Cameron called such assessments “bureaucratic nonsense”, but it seems to me that this issue is crying out for one, because someone should have thought about the fact that mums would be targeted. Of course, some dads were drawn into the net, and I am not denigrating their experience in any way, but it is not acceptable for Government policy to lay a particular burden on mothers in such circumstances.
Not only are more women affected than men, but they are affected by more costs than men. Four fifths of the savings that the Government have made through their so-called austerity programme have been contributed by women. One thing for which I was really proud of the previous Labour Government was that they increased the amount of resource that went into women’s purses compared with men’s wallets. Through measures such as child tax credits, they dealt with maternal poverty pretty effectively. The current Government are doing their jolly best to reverse that progress.
My right hon. Friend is making an incredibly powerful speech. However, this is not just about mums, important as they are; it is about the impact on their children. My constituent Sinead is a single parent. She went from receiving £122 child tax credit to absolute zero. She is paying off a crisis loan and that is impacting on her relationship and her ability to be a great parent to her five-month-old child. There is also Caroline, whose two children are in nursery. She is thinking of quitting her job because she cannot now pay the nursery fees. This issue is having an impact on children as well as mothers.
My hon. Friend is absolutely right. Indeed, for most of the victims of this situation, there has also been a significant effect on their self-confidence and on their reputation. Some get these letters at very stressful times in their lives—following a difficult divorce, while they are trying hard to separate themselves from a violent partner or after childbirth. The behaviour of Concentrix just added to their stress.
My right hon. Friend has been very generous in giving way. She talked about the burden of proof. One woman claimant in my Neath constituency came in to see me because her payments had been stopped, as she had not replied to a letter that she had not received and there were no follow-up letters. Where does the burden of proof lie there?
The law is clear that the burden of proof lies with the Government and they need to have a proper reason to believe these things. As we know, however, many of the reasons why investigations were initiated were not what any court would describe as proper. That is a fundamental problem.
The Government announcement of the termination of the contract sought to reassure
“customers who have had their tax credits stopped that we will prioritise their cases, and make sure that they are processed as quickly as possible.”
That was a nice thought, was it not? However, Concentrix has informed me that, just on mandatory reconsideration cases, which were returned to HMRC on 19 September, nothing at all was done until 3 October. So not only is Concentrix operating on the basis of really flimsy information; it is also telling lies to Parliament and to the Government, because I do not consider that to be prioritising cases and making sure they are processed “as quickly as possible.”
I hope the Minister will answer the specific points that I have raised. This contract has been something that, frankly, we should all be ashamed of. The way that we have treated the mums and dads on low pay who are bringing up the next generation has been shameful. And actually, although I asked for this debate about the performance of Concentrix, the responsibility for this situation fundamentally lies with the Treasury and HMRC. The process is clear. Again, I quote Concentrix:
“Whilst the initial decision to halt an individual’s tax credit claim may, at the end of the process, prove to have been unnecessary”—
it did not feel “unnecessary” to the victims—
“the process is set by HMRC. Whether it is Concentrix managing this process or HMRC directly, the same hurdles and challenges are experienced because of the information held by HMRC at the outset.”
It seems to me that this goes to the heart of the Government’s use of information about citizens. The Government have a responsibility to assist citizens in giving them the information they require in order to assess their entitlement to something such as tax credits. The Government did that at the beginning of a tax credit claim, but their process for doing that as a tax credit claim continues is fundamentally flawed, and those flaws were made worse by the way that Concentrix operated.
I come to the conclusion that there are certain tasks that the Government simply should not delegate to a private company or to anyone else, and the collection of taxes and the issuing of tax credits is one of them. I hope that this will be the last experiment in that vein. I want to pay my taxes to the Government; I do not want to pay taxes to some company that I do not understand. Equally, I want to receive tax credits therefrom.
In future, no policy that has a disproportionate impact on women, especially those struggling to bring up a family, should be tolerated by the Government. I hope that the Minister will say that when things like this are contemplated in the future, Ministers will consider which groups in society will be disproportionately affected by their policies, in order to ensure that they do not continue to target women in the way that, frankly, this Government have throughout their existence.
Mr Nuttall, it is a pleasure to serve under your chairmanship.
Over the last few months, I have heard innumerable distressing accounts from people living in my constituency of Dundee about how the failures of this US multinational contractor are driving families immediately into poverty, driving them to food banks, driving them—in some cases—into losing their homes, and driving individuals from my constituency to make calls saying they feel suicidal because they feel they have nothing left to live for.
Unsurprisingly, this is not the first time that Government outsourcing has failed to meet expectations. In the past, we have seen that results-based contracts do not improve the quality of public services. I am sure that everyone in Westminster Hall today remembers Atos, whose shambolic and cruel tests were designed to strip away benefits from sick and disabled people. Under its contract, Concentrix is paid on a payment-by-results model when tax credit claims are cut; in other words, the more tax credit payments Concentrix puts a stop to, the more commission it pockets.
In July, the Social Security Advisory Committee recommended that
“appropriate safeguards are needed to preserve justice for the claimant.”
So far, and as my constituents’ cases prove, that is clearly not being achieved. To add to that, Her Majesty’s Revenue and Customs is continuing to cut jobs right across the UK, while at the same time privatising and outsourcing contracts. HMRC departments that are already understaffed have been left to pick up the pieces; they have spent months dealing with backlogs of claims and errors.
The contract with Concentrix has not been renewed, which is a step in the right direction. However, this Government need to go further. They should not only put an end to the Concentrix contract immediately but call time on awarding any public contracts on a payment-by-results basis. We all need to remember that those of us who have the privilege to be Members of this House are here to serve the public. In that spirit, we need to ensure that organisations that are allowed to act on our behalf demonstrate a similar commitment to service, dignity and respect, rather than to profit. Payment-by-results contracts should have no place in the delivery of such important services—
Like many colleagues, I have seen a substantial spike in the number of tax credit inquiries following the letters from Concentrix. Our constituents expect action to be taken to ensure that benefits and tax credits are paid to the right people, and not to people who should not qualify for them. They also expect that process to be fair and sensitive. It is clear, however, that that has not been the case with Concentrix. So I am relieved—indeed, delighted—that the contract with Concentrix will not be renewed. However, we need to consider a number of questions, many of which were raised by the right hon. Member for Slough (Fiona Mactaggart), about whatever contract or system replaces the current Concentrix contract.
The first question is about the letters coming from Concentrix, including the form and style of those letters. In addition to letters that a number of my constituents have shown me, I have seen one of the letters that a member of my family received. Frankly, I would not have assumed that that letter came on behalf of the Government. It was of very poor quality; the letterhead looked as if it had been scanned in or computer-generated; and to all extents and purposes it looked like a scam, and I would have been very reluctant to responded officially to it.
We have spoken about the burden of proof and where it should lie. We also must consider the standard of proof. Concentrix has been treating the standard as beyond the realm of possibilities instead of on the balance of probabilities, and that is entirely inappropriate, particularly given what it calls the evidence. Data from credit searches and the like may be useful intelligence for starting further investigations, but they are not, in themselves, evidence. I am pleased that the contract is not being renewed, and I hope that the Minister will be able to give us some reassurance.
It is a pleasure to serve under your chairmanship, Mr Nuttall.
Since 6 September—just six weeks ago—I have had 11 constituents bring their complaints to me. In one case, Concentrix did not believe a young woman because it saw money from someone with the same surname going into her account. It refused to believe that it was because she handled her mother’s bills. Just because she was helping out her ageing mother, that lady had to pawn her late father’s jewellery so that she could put food on the table for her family. Another constituent’s tax credits stopped after the Concentrix system incorrectly calculated that she had worked under the threshold; it even ignored a letter that she provided from her employer. As of today, she has been without payment for nearly four months.
It is degrading to not be believed and trusted, to be considered to be cheating the system, especially when evidence and sound reason to the contrary are given. When someone is working hard to make ends meet, it is deeply insulting and demoralising to have the floor unjustly ripped out from under them.
Fortunately, the message seems to be getting through, because Concentrix has, indeed, been given the boot, but the Government’s new approach, which has ended up with their having to hire hundreds of staff into the Revenue, will end up costing millions—talk about a false economy. That is the problem of a Government who know the cost of everything and the value of nothing; the presumption is of guilt, not innocence; the currency is suspicion, not trust, and those who need and are entitled to help are made to feel like cheats.
Theresa May claims that she wants to build a country that works for everyone, yet her Government consistently undermine some of the basic binds that are supposed to hold our country together. There is no excuse or reason for that. Let us hope that lessons are learned and that, from now on, systems are built to reduce insecurity in people’s lives rather than leaving them on the edge of survival.
I congratulate my right hon. Friend the Member for Slough (Fiona Mactaggart) on bringing the debate to the House. Like many right hon. and hon. Members, I have been inundated with desperate calls from constituents who have had their tax credits cut. Although blame has been apportioned to Concentrix, the company was being forced to meet targets because the contract involved payment by results. I have seen constituents reduced to tears after being accused of misdemeanours in a very humiliating and degrading way in relation to their applications. On investigation, it was found that they were not at fault at all, so all their anxiety was unfair and totally unwarranted.
Let us be clear that the fault lies with HMRC, which set the targets and placed the policy and operational failure at the door of Concentrix. The failure lies with HMRC because over the years it has been peddling a cost-cutting exercise and closing offices. We have seen that in Northern Ireland. We have seen competent staff forced to centralise in other locations. HMRC has not been doing its job properly. It has been targeting the wrong individuals—the poor and the vulnerable. Will the Minister specify what will happen to the contract? Will it be outsourced again? Frankly, I believe that HMRC needs to row back and have a much more friendly, sympathetic and humanitarian attitude towards claimants, particularly those who have been reliant, in a very unnecessary way, on food banks.
It is a pleasure to serve under your chairmanship, Mr Nuttall. Right hon. and hon. Members have already highlighted numerous ways in which our constituents have been badly affected and I want to highlight just one more. Constituents are suffering ongoing problems, even when mistakes by Concentrix are acknowledged and credits are reinstated. Having built up big debts to friends or family members, or even to childcare providers who agreed to keep working on the expectation that debts would be settled on the resolution of the tax credit problems, my constituents are now being told that they will get their back payments over the course of a year. That does not really help, because the major debts are due now. Will the Minister explain why HMRC cannot make the back payments now? It is not fair on our constituents and it is not fair on those who have had to help out when the Government have failed in their duty.
I agree that this was a rotten contract from the outset, with a commercial organisation making decisions about a claimant’s past eligibility and getting payment by results. The contract even specified how many cases— 2 million, I think—were expected to be modified, even before a single piece of evidence was considered.
Back in July 2016, the independent Social Security Advisory Committee said that the payment model would:
“potentially create a conflict of interest”.
The only bit I can quibble with there is “potentially”. It was a clear conflict of interest. It becomes hard to square information from our constituents with what we are told about the performance of the contract. I read somewhere that only 120 cases had breached the contract terms, yet I think we have had almost 120 examples of awful cases in the debate so far, so either the systems for monitoring contract performance are not up to scratch, perhaps because they rely too much on the company the performance of which is being measured, or they are monitoring the wrong things entirely.
I hope that the Government will explain what more they will do to resolve the mess, because they are not doing enough yet. Once cases are brought back in-house, they should stay there. We should not repeat the same mistakes again.
I congratulate my right hon. Friend the Member for Slough (Fiona Mactaggart) on the excellent case she has put. Like many right hon. and hon. Members, in the past few months my office has dealt with dozens of cases every week of people who have found themselves in increasingly desperate situations as a result of Concentrix investigations, and I would like to make it clear that I welcome the decision not to renew the contract. I hope that it leads to the work coming back in-house.
Some of my constituents are victims of domestic abuse and have gone to refuges and then been rehoused. Although their support workers have told Concentrix of the change in their circumstances, it has not been logged. One constituent’s brother was accused of being her partner, and another constituent was accused of co-habiting with a former tenant. Many have been drawn to the discretionary assistance fund administered by the Welsh Government and to food banks. Yes, in the medium term we need scrutiny of how that has happened, of why it has not been monitored and of the payment by results model.
HMRC staff have been drafted in to help, but there are clearly not enough of them. All credit to them, but they have suffered huge cuts over the past few years. It clearly will not take 21 days to deal with some of the cases—I have heard that it will take up to six weeks. We need to clear the backlog now, because there is much distress out there and people have suffered. We need the Minister to give a clear steer about which cases are the priority. Yes, we urgently need to learn the lessons, but we also crucially need help now for those affected, with more staff to turn cases around.
We must acknowledge the number of people who have been hurt as a result of this debacle, but it is important to point out two things. First, the history of tax credits and the way in which people have been dealt with extends well beyond the current contract. During much of my political career, before the work was ever contracted out, I have had people come to me about their difficulties with tax credits and with HMRC. So it is not a new problem; this is a complicated benefit and the issues go back some time. The contract was made by HMRC. The referrals were given to Concentrix by HMRC. The guidance was given by HMRC and the company acted on it. If there is any fault to be attributed, it has to be shared with the people who issued the contract in the first place.
The second thing is that HMRC has treated the workers in Concentrix diabolically. They found out in the news that they were losing the contract and therefore their jobs. That is no way to treat workers, many of whom were dedicated and simply acting on the information and the guidelines given to them. They were trying to do their job to the best of their ability.
Whether this matter is contracted out or kept in-house—I have no difficulty with contracting out some services—problems will persist so long as the attitude, the wrong information and guidance and the bureaucratic rules of HMRC continue.
I congratulate my right hon. Friend the Member for Slough (Fiona Mactaggart) on securing this debate. Like many other hon. Members, I have been appalled by the nature of the complaints that my office has received from worried constituents faced with extreme hardship following action by Concentrix to suspend their tax credits. I accept that some providers may want to conduct checks to ensure that money is being paid to the right people, but it is wholly unacceptable to stop money being paid to parents without evidence while checks are carried out. The action taken by Concentrix has caused extreme hardship for many of my constituents and people across the country. They use the money to provide food and essentials for their children and families, and to be without for a long period of time is unacceptable and has resulted in many families resorting to food banks and in some cases going without. That is utterly shameful.
Of the many cases brought to my office, one relates to a constituent who had her tax credits stopped because Concentrix believed she had an undeclared partner. Following much stress and my constituent providing extensive evidence that she did not have an undeclared partner, it transpired that the basis of the action by Concentrix was an out-of-date record of a previous tenant at her address.
While Concentrix has to bear its share of the responsibility for the hardship faced by many people in recent months, HMRC also has to bear its share for allowing things to get into this mess. Does the Minister accept responsibility for HMRC’s lack of scrutiny? What lessons will be learned before anyone else is engaged to do the work? I am particularly interested to know whether HMRC is considering retaining this work in-house rather than using the targeted payment-by-results model that has caused so much hardship and stress to so many in my constituency and across the country.
We have all had cases of people who have been vindicated after their lives have been turned upside down. They may have had their payments reinstated and even sometimes their bank charges refunded, but what about the high-interest payments they have had to make to payday lenders? What about the jobs they have lost because their childcare provider cancelled due to lack of payment? Where is the justice in those situations?
In one case, a working mother of four in Midlothian lost her job because her childcare provider cancelled on her. She put out an appeal on social media to ask complete strangers to send her five-year-old son birthday cards so that he could have something of a birthday. She was so ashamed at not being able to provide her children with anything other than a basic ration pack from a food bank. How can that situation be justifiable? Members from all parties in the House have highlighted similar cases across the country featuring single parents. Those situations are not coincidental and they were preventable. The strategy has been utterly shameful.
One thing that is clear from the Concentrix experience is that it achieved nothing and created a mess that has damaged people financially and emotionally—a mess that has been and continues to be expensive to correct. Additional resource is being appointed within HMRC and the civil service and the suggested cost of the Concentrix contract is reputed to have been £75 million so it seems fair to end my contribution by asking how much of that money will be clawed back to directly compensate those affected most.
As constituency MPs, we are all aware of the hardship and suffering caused by Concentrix. By definition, people receiving tax credits are on low incomes and are not able to cope with a sudden drop in that income. Concentrix’s “Shoot first, ask questions later” approach, in which recipients have been accused of living with people they have never heard of, it takes more than an hour for their calls to be answered, and it is suggested that they get by on payday loans while Concentrix sorts out its mistakes, caused anxiety, distress and extreme hardship. In many cases, we have had to make personal referrals to food banks, so that people can feed themselves and their children. We all have examples from our postbags and inboxes of shocking cases in which families have been left struggling to make ends meet.
By way of example, I want to put on record some of the highlights—perhaps I should say lowlights—of the many cases I have had to deal with in recent weeks, and show the pattern of incompetence that has been exposed. More than three quarters of the cases I have dealt with have been of people accused of living with the previous tenant at their address. In one case, a constituent found after asking their neighbours that the person they were suspected of living with was in prison.
It is worth pointing out that with a handful of exceptions, all the cases that have come to my attention have been raised by women, and two thirds are from single mothers. In nearly two thirds of the cases, constituents found their tax credits stopped without any prior warning. When they contacted Concentrix, they were told that letters had been sent to them weeks previously but not replied to, hence the stopped payments. The occasional letter going astray in the post is one thing, but Concentrix is apparently sending letters into some black hole, never to be seen again. Advice given over the phone has been inconsistent and often contradictory. My constituents have reported that, as have my staff.
I share Members’ frustrations about dealing with Concentrix in the constituency cases that come to us, but our frustration is nothing compared to the distress and desperation caused to many constituents. Let us be clear: as the right hon. Member for Slough (Fiona Mactaggart) indicated, we need to look closer to Parliament when asking some of our questions. The fact is that the contract was conceived by HMRC in a spirit of suspicion and hostility towards its customers. It said that it wanted to handle the high-risk renewal cases in this way, and it intimated to Concentrix that it was disappointed that Concentrix had screened out 80% of the cases referred to it as likely to be high risk and did not pursue them further. Perhaps that is one of the reasons why HMRC is taking the contract back. It perhaps feels that it could make a hotter and heavier pursuit than even Concentrix could.
The right hon. Lady also touched on the significant spike in August, when even more calls to Concentrix were waiting and even more call queues could not be dealt with. That came from HMRC’s direct move to remove 45,000 people from tax credits. Some of those people were supposedly under investigation by Concentrix as high-risk renewals, but HMRC moved against them because of the annual declaration process. We have two separate processes going on, and the one thing in common is the victim: the claimant. Did Ministers know that HMRC was striking off people when they were going through the high-risk renewal claim?
The other issue I want the Minister to address is the law. The right hon. Lady raised the question of the burden of proof, but Concentrix insists that HMRC is saying that the 30-day cut-off on non-compliance is absolute and in statute. Do we need to change that law?
For too long, Concentrix left families in vulnerable situations, wondering where their next meal would come from or how they would make their next rent payment. I have heard from multiple Tooting residents—all of whom are single mothers—of the stress that Concentrix caused them by stopping their tax credits via false claims that they had a partner living in their property. My constituents found those claims so difficult to disprove, and subsequently struggled to make ends meet for many months on end.
One constituent came to me in early August. She is a single mother of a 14-year-old girl, and her tax credits were stopped by Concentrix due to her supposedly having a partner living with her—a partner who did not exist. She was left with £4 in her bank account to last her 16 days. As if that was not bad enough, two days later she was informed by the council that her housing benefit was being stopped due to her supposed change of circumstances. That left her unable to afford her rent and reliant on food banks. As if that was not bad enough, HMRC then demanded almost £4,000 in back payments for this change of situation. Some may say she was lucky: it took only one month for HMRC to overturn the termination of her tax credit and housing benefit. As we have heard, many others across the UK have had to spend many more months waiting for that result. However, I would say she is not lucky. No mother, father or carer should ever be left with £4 in their bank account and no knowledge of when they may be able to put food on the table again.
People deserve not only answers from Concentrix, but to know from our Government that such situations will not happen again. We have a duty; we need to reassure those who put their trust in us that we will not allow this to happen to any other family. We have a duty to protect our citizens, and that protection comes in many forms. With respect to Concentrix, we have failed in our commitment. Will the Minister today reassure us that this will not happen again?
Like other Members in the Chamber, I am all too aware of the significant number of people caused great hardship by the withdrawal of tax credit payments. Many of them are in my constituency of North Ayrshire and Arran. Some of my constituents have had payments stopped because the claimant has been incorrectly accused of sharing a home with a non-existent partner. Tax credits have been suddenly and unexpectedly withdrawn, with the claimant even having difficulty in securing any kind of explanation, however misguided and mistaken that explanation turns out to be. Claimants are on the phone for hours over weeks and weeks, and are caught up in a grotesque bureaucratic nightmare. The system seems to mock their hardship, leaving them to rely on food banks.
There can be no doubt that the system is a mess. Concentrix’s indiscriminate and groundless accusations of fraud directed at low and middle-income families is completely unacceptable, and cause huge emotional distress, financial hardship and utter despair. Now we know from reports that Concentrix’s misconduct could be in breach of the Data Protection Act, since claimants’ details have been known to have been sent to the wrong address. The allegations are extremely serious and must be fully investigated by both Concentrix and HMRC. Outstanding cases must be dealt with urgently. Only then will the hardship caused end. I urge the Minister to indicate how and by when that will happen. Concentrix’s contract expires in May 2017, but the suffering continues right now. Urgent action is needed to protect claimants from this appalling situation.
I, too, have been inundated with calls from desperate constituents who have had their tax credits stopped owing to accusations that they are living with another person. So far, every single one of the cases investigated has been proved false. The undue stress and pressure placed on parents is beyond belief, and the Government must take responsibility. I thank the few Government Members who have turned up to listen to the debate.
One woman had food in her freezer to feed her child, but the money on her electricity meter ran out, and the food defrosted and had to be thrown away. Another said that she was not bothered about feeding herself, but it broke her heart to see her children go hungry. People have been seriously let down by the failings of Concentrix, a company appointed by and acting under the watch of this Government. All the people affected deserve answers as to how and why such a situation was allowed to happen.
We are starting to see a slow trickle of reinstated payments, but in some cases the back pay has not been paid, the bills that were building up are turning into court summonses, and debts are growing. Unfortunately, people are having to turn to payday loans and loan sharks. The dilemma my constituents face is whether they ask for another mandatory reconsideration to investigate the missing back pay and risk having their payments stopped again. I simply cannot express my feelings of anger towards those responsible for this monumental failure and for the damage done to thousands of needy families across the country. It is not good enough simply to say that the contract will not be renewed. We need an urgent investigation into how this happened in the first place. Furthermore, we need to know that all the cases still open will be resolved urgently, and we need complete assurance that this will never be allowed to happen again.
Julie Molyneux, a constituent of mine, was accused of working for only 15 hours, when she had worked 16.5. She phoned HMRC and was told to phone Concentrix. She phoned Concentrix and was told to phone HMRC. She went round and round in circles. Her tax credits were stopped for eight weeks and she was forced to live on £63 a week, with two children to look after, one of whom is disabled. It was acknowledged that a mistake was made, but it has still not been put right.
Hayley Jones was accused of living with a previous tenant. She tried to get through to the system for a week without any luck. She finally got through, but was put on hold for an hour and a half. When she told them she had sent in all the relevant documents, they denied receiving them. She was left without money for eight weeks. She had no money at all and four children to support.
Paula Bee was informed—this was new to her—that she was living with an ex-partner, when he was living somewhere else. She had to try to track him down so she could supply a copy of his rent agreement. What did not get paid as a result of that? People have been unable to get through to the telephone helpline. When constituents do get through, they are placed on hold for more than an hour, in the worst case. Operators are rude to them when they are trying to resolve problems. Single women are told that they are living with other people, and it always turns out to be previous tenants. Concentrix says it has not received forms. It says people should ring HMRC, and HMRC says they should ring Concentrix. Nobody responds to letters for a very long time.
This situation has to stop. It has to be put right. My constituents who have been affected must have it put right now.
It is a pleasure to serve under your chairmanship, Mr Nuttall. I congratulate the right hon. Member for Slough (Fiona Mactaggart) on securing this debate, and I congratulate all the Members here who have demonstrated real compassion and understanding on this matter. The Minister might not have been on the other side of phone calls from constituents, but it is worth making the point that people who phone our constituency offices are at desperation point—at their wits’ end. Indeed, our constituency office staff are finding it extremely difficult to deal with people in dire need of help. I hope the Minister will take that into account when considering my further points.
We have all faced a number of these cases. On 14 September, I asked the Financial Secretary to the Treasury what the turnaround time would be for dealing with cases, and I was told four working days. On 29 September, in a phone conversation with HMRC, we were told it would be two to three weeks before cases were looked at. On 4 October, I was told the four-day period had been dispensed with. That is not good enough. I have a constituent who set up a food bank, but who is now a customer of that food bank. I know of a mother who cannot afford childcare and had to resign from her job, a mother who cannot afford lunch money to send her children to school with, and a mother who had to sign herself out of hospital after a suspected heart attack to deal with the issue. These are really serious matters, so I have a list of suggestions that the Minister might take on board so that these people can achieve justice immediately.
HMRC should provide a free phone line for people to use. It is ridiculous that people spend between 8p and 10p a minute to speak to HMRC and hold on for hours. On hardship payments, I understand that HMRC will call people, but they get two call-back chances. If HMRC does not get someone in those two phone calls, they will not get the hardship payment. When people have a small sum of money, and have to decide whether to feed the children, or top up or reconnect the phone, what do people do? They do what we expect them to do: they feed their children. Such situations must come to an end.
The call-back service that is provided should be there for people to use. People could leave a voicemail or press a button in order to get a guaranteed call back from HMRC. Our constituents should not be chasing HMRC for money that is rightfully theirs. It is not their error.
On the posting of documents, HMRC should distribute postage-paid envelopes to our constituents, so that they bear no cost when sending documents back to HMRC to have cases processed. On the contract that has been cancelled, of course that is welcome, but I want to look further into that contract. Did it reach its natural conclusion? Did the Government simply decide not to renew? What compensation is available to our constituents for the situation in which they find themselves as a result of a contract that has not served the Government well?
I agree. On the £100 payment, there is a lot of haziness around it. Some of my constituents have not taken up the payment because there is no clarity around whether it is repayable or not. Again, that has to be dealt with. As I have said, if someone does not receive the phone call offering them £100, they do not get it, so if someone does not have a phone because they choose food over contact with HMRC, they do not get anything.
We do not have much time and I want to give time to the Minister to answer these important questions. Apart from the suggestions that I made on what HMRC should immediately do, these are my key questions for the Treasury: what is the latest guidance given by HMRC bosses to call handlers on how long a person can wait for the tax credit payments to be restarted? How many cases have been resolved, and how many are outstanding? On the impact on victims, what estimate have the Government made of the average cost to each customer in lost payments? What assistance is there to help claimants meet the costs of requesting a mandatory reconsideration?
What are the criteria for offering emergency interim payments? Are all victims eligible, or only those whose cases have been highlighted through the MP hotline? Why has the existence of those payments not been publicised? It is not in the wider public domain. How many victims satisfy the criteria, and how many have been offered the payment?
Why did the contract between HMRC and Concentrix incentivise the company to cancel tax credit payments? What a disgrace! Of course that is a conflict of interest, as suggested by the independent Social Security Advisory Committee in July. Why was the contract so badly managed? Will the work be brought back in-house following the end of the contract, or will a new external contractor be sought? Please will a Minister do the right thing by our constituents and give them the money that they need, and rightfully deserve?
It is a pleasure to serve under your stewardship, Mr Nuttall. I start by thanking my right hon. Friend the Member for Slough (Fiona Mactaggart) for enabling Members to consider this matter, as well as hon. Members from across the House who have attended and spoken. I counted 24 interventions or speeches, and there was a theme in the words that were used time and again—words such as “shameful”, “shocking”, “distressing”, “desperation”, “anger” and “despair”.
Like other hon. Members, I have received many letters and phone calls from constituents who, to their shock and bewilderment, have found their child tax credits stopped, with little explanation and with few avenues of recourse. Under the Government’s contract with Concentrix, thousands of innocent mothers—the vast majority are working mothers—were in effect branded fraudsters and cheats. At the drop of a hat, they saw money that they desperately needed for their children taken away, notwithstanding their entitlement to it. Yet the company is not solely at fault—the Government are, too. Despite the protestations that the Minister will no doubt make today, the Government gave Concentrix a contract that was a licence to harass and was open to abuse. It does not take Sherlock Holmes to work out that if a company is paid commission to find tax credit error and fraud, it will start with the easy targets so as to turn an even easier profit.
What is more shocking is that the victims, which is what they are, did not have the means of fighting back. They were disfranchised. Hon. Members have spoken of their need to intervene personally in many cases to get movement. The whole process was deeply flawed and, as has been suggested, operated on the presumption that people were guilty until proven innocent—a concept completely alien and contradictory to our values, and our sense of justice, fairness and decency.
Under the system, the occupant of a household was sent a letter by Concentrix accusing them of not meeting the standards for child tax credit. The letter demanded that they get in touch to present evidence of their living arrangements. Having received the letter, some constituents attempted to call Concentrix, only to find the number busy, a point that has also been made. When Concentrix did not hear back from the person, who may not have received the letter in the first place, another letter was summarily sent, stopping tax credit payments. As far as I am aware, at no point was a Government Minister consulted or asked to sign off the process—can the Minister tell us otherwise? Instead, a private foreign company, whose sole interest was profit, was allowed to withdraw tax credits on behalf of the British Government. That is what makes the contract so unique: the vast power Concentrix had to act on putative information.
Jon Thompson, the chief executive of HMRC, confirms that in this novel approach, it was the first time such checks had been carried out by an external provider. Even Atos did not have the power to withdraw benefits. Concentrix had carte blanche. The Government were in fact planning to renew the contract for a job well done. They did not care to ask why Concentrix had so many savings on its books, or to listen to the complaints of many of our constituents. It was the Labour party that originally called the National Audit Office to investigate and the Labour party that has pushed for oversight and demanded action for the thousands of families who have still not received repayments from Concentrix.
We see the austerity cuts hitting women hardest, and the Government changing women’s pension age. Now we see the Government contracting private companies to take away money from single working mothers. We cannot help but ask what this Government have against women. What do they have against hard-working single mothers? It comes down to a lack of care. In essence, the Government are happy to outsource important processes affecting people’s lives to private corporations to make a profit. So be it, but not without the proper checks and balances being in place.
The hon. Gentleman makes a fair point that needs to be looked at.
When all is said and done, this is a question of the performance management of a Government contractor, and a clear lack of oversight by the Government. On behalf of the many people affected by the debacle, I would like to performance-manage the Minister by asking the following questions. First, who was overseeing Concentrix’s contract? Secondly, how was the oversight conducted? Thirdly, how often was it reviewed? Fourthly, what were the penalties for mismanagement of the contract? Fifthly, when did the penalties kick in? Sixthly, what penalties are left on the contract? Seventhly, will Concentrix be paying back any money to the Government? Eighthly, how many people have been affected? Ninthly, what actions have the Government taken proactively to compensate those people? Tenthly, have the Government sent out formal apologies to those affected? And finally, when will the last person who has had their child tax credit withdrawn receive repayment? Those key questions need to be answered and acted on. We do not want any shilly-shallying from the Government.
Those are important questions, which I am sure the Minister will pick up on in his response. I fear that unless the Government get to grips with their commissioning processes, we will be back here in six or 12 months’ time, looking at another company that has abused a Government contract for profit and, in so doing, deprived some of the most vulnerable people of much-needed financial support. The situation needs to be sorted; otherwise, I fear the fiasco will be repeated and the Minister will be doing an encore in due course.
It is a pleasure to serve under your chairmanship today, Mr Nuttall, in my first debate in Westminster Hall. I give the Financial Secretary’s apologies: she is on a Bill Committee and cannot be in two places at once. I have listened carefully to what has been a very interesting debate and will do my best to answer all the questions.
I congratulate the right hon. Member for Slough (Fiona Mactaggart) on securing the debate and take this opportunity to thank all right hon. and hon. Members for their efforts, not just in the debate but during the past few weeks, supporting constituents and bringing to our attention the difficulties that constituents are experiencing with their claims for tax credits. I reassure hon. Members that we are making every effort possible to resolve those difficulties as soon as possible and to make sure that the support provided through tax credits reaches those who really need it. There is no doubt that last month we were falling short in the level of customer service that we were providing to claimants, and I am very sorry about that.
In our efforts to tackle error and fraud in tax credits, we had engaged Concentrix to investigate claims and it did help us to drive down error and fraud to almost the lowest level since tax credits began. However, faced with a high volume of calls, Concentrix struggled to provide the kind of service that people had a right to expect—indeed, the kind of service stipulated in its contract. That led to a stressful time for a lot of people, including some of the most vulnerable, as they struggled to reach Concentrix to resolve any queries about their entitlement to tax credits. Let me be clear that that was not good enough, which is why we stepped in to get things back on track.
Where did the information, particularly on cohabitation, come from? So many of our constituents have been accused of cohabiting with the previous tenant of their usually rented property. Were the data HMRC-matched or did Concentrix do it all on its own?
We have heard today of constituents who have lost employment, college courses and access to childcare, and have been forced to go to food banks and take out payday loans, which inflicts stress and trauma not only on the parents but on the children. Having admitted that it was the responsibility of HMRC as well as Concentrix, will the Minister commit to expanding the compensation available to reflect the hardship and trauma inflicted on those people?
I will make some progress, and if the hon. Gentleman listens carefully, he may well hear some things that are helpful to that question. Before I turn to those points, let me outline what we are doing.
First, as my hon. Friend the Financial Secretary announced in the House last month, HMRC is not passing any new cases to Concentrix. We have been very clear that the contract will not be renewed beyond the end date of May 2017. Secondly, staff at HMRC are, as we speak, making every effort to resolve all open cases to ensure people get the payments they need and deserve. HMRC took back 181,000 outstanding cases from Concentrix and it has already dealt with more than 149,000—82%—of them. I would like to reassure everyone whose case remains open that we are making every effort to complete those cases within the next couple of weeks. It really is a priority.
I will not give way.
Thirdly, anyone who does not agree with Concentrix’s decision has a right to ask for a review called a mandatory reconsideration. HMRC has allocated its own staff to carry out such reviews within 21 days of the request. It is a large organisation with flexible staffing, so it is able to deal with peaks and troughs of demand. The hon. Member for Aberavon (Stephen Kinnock) mentioned the issue of extra costs, but I am confident that there will not be any.
As I said, HMRC has a large number of staff, who are flexible and deal with the peaks and troughs of demand. If HMRC, after receiving the relevant information and reviewing the case, finds that the claimant is entitled to tax credits, they can expect to see that money in their bank accounts within four working days.
Lastly, we are working with hon. Members to help their constituents who are struggling to resolve any issues. We have extended opening hours and have put extra advisers on the tax credits hotline for MPs, which is now handling about 200 calls a day. I am pleased to inform hon. Members that my hon. Friend the Financial Secretary, following last month’s drop-in session, will be holding another session tomorrow in the House of Commons Library.
The news that HMRC will not renew the contract with Concentrix is welcome. Those responsible for these reprehensible practices should be held to account. When these services are brought back in-house, we must ensure that the blanket, baseless accusations and sanctions that have been applied will stop and that compensation will be made for the Government’s mistake. Will the Minister take the opportunity to apologise to my constituents and the women and men up and down the country who have experienced the Government’s failure?
None of us in this Chamber wants anyone not to receive money that they are entitled to, especially if they are parents with young, vulnerable children. It is up to all of us to help our constituents and ensure we once again provide a fast and efficient service to everyone.
Let me turn to some of the issues that were raised. I do not have a lot of time, so hon. Members will have to bear with me. I acknowledge the points made by many hon. Members about the contract. HMRC will be undertaking a lessons-learned exercise, and it will share those lessons across the Government. It is clear that they will help to inform other contracts in the future.
There will be a number of reviews, and all lessons learned will be looked at in an open-minded manner. We will consider all elements of what has gone wrong and try to ensure that the mistakes, which have clearly happened, are not repeated.
I have talked about how the data are given to Concentrix. It is up to Concentrix to choose who to contact from those data. The £100 hardship payment is important. It is available to everyone, not just through the MPs’ hotline. It is not necessarily a one-off payment; future payments can be made if there is a delay in the decision. I encourage people in hardship to apply for it, because it is there to help people while we sort out this mess.
The hon. Member for Foyle (Mark Durkan) talked about the 30-day cut-off period. I can tell him that most customers have been able to provide the information required within 30 days. There was a question about money being clawed back from Concentrix. Concentrix is not paid for wrong decisions, and payment is reduced where it fails to meet performance standards. That is still happening. At the end of the day, it is paid to do a job, and if it does not do the job, it is not paid for it. I have noted the comments about letters being lost.
In conclusion, I thank everyone here. This has been a short debate, and it would have been nice to have more time for contributions. I am here to listen, and I have listened very carefully.
I thank the Minister for that response. This is probably my first experience of leading a debate in which everybody apart from the Minister has agreed with one another. I thank all hon. Members who contributed.
I am particularly concerned about the Minister’s account—I know he is not the Minister responsible, but I hope he will pass this on to the Financial Secretary—which implies that this is just a recent phenomenon, because it is not. It has existed for a long time; it is not just a recent failure. I also do not accept that Concentrix should be wholly blamed. I note that the Minister said it is up to Concentrix to choose which information to use. I would like him to write to me after this debate to tell me whether it is true that HMRC pressed Concentrix to use data on cases in which it was not even able to name the claimed partner. That shows that HMRC is responsible for this oppression of women. The Minister did not note in his response the concern expressed by many Members that this is a gendered policy—
Earlier Cancer Diagnosis: NHS Finances
I beg to move,
That this House has considered earlier cancer diagnosis and NHS finances.
I thank Mr Speaker for allowing this debate and you, Mr Nuttall, for presiding over it. I also take this opportunity to welcome the Minister to his new post. He has been in it a while now, but this might be his first Westminster Hall debate. We look forward to working with him—he comes highly recommended—and I thank him for accepting the invitation, on behalf of the Secretary of State for Health, who was unable to make the appointment, to speak at our Britain Against Cancer conference in December.
Early diagnosis has been a key theme of the all-party group on cancer for some time. We call it the “magic key” to cancer. If we can drive forward on our rates of early diagnosis, the stage at which we first detect cancer, we can improve survival rates significantly.
I should perhaps briefly explain to the Minister that there is a little history to this involvement. Back in 2009, the all-party group published the report of an inquiry it had conducted into cancer inequalities. We found that patients in the NHS at the one-year point since their cancers were detected stand as much chance of surviving to the five-year point as they would in any other healthcare system. Where we let ourselves down, however, is getting patients to the one-year point. That suggests that the NHS is as good as any other healthcare provider in treating cancers once detected, but poor at detecting them in the first place.
In this country, our survival rates have been ticking up, with the rate of improvement broadly similar to that in other countries, but our survival rates still stand well below those of many other countries. For example, in this country the overall one-year survival rate is about 70% or 71%, but in Sweden it is 82%. That might not sound like a big difference, but overlay that differential with regard to the population of the UK as a whole and it tells us that tens of thousands of lives a year are needlessly being lost because we are diagnosing too late.
We need to focus on early diagnosis, and the Minister is in a unique position to be able to make a real difference to a large number of people if we can get it right. Yes, cancer survival rates are improving, but they are improving around the world and we are still well behind international averages. We welcome the improvements, but we have still not yet seen that kick-up that will allow us to catch up with those international averages.
Our 2009 report came up with, in essence, one recommendation. Reports can always come up with myriad recommendations, but we believe in short reports and, having consulted with the wider cancer community, the good and the great of the cancer world, the charities, patients and so forth, we came up with one recommendation: to ensure that we focus the local NHS, the clinical commissioning groups— primary care trusts then, CCGs now—on their one-year survival rates.
The logic is simple: the earlier we diagnose, the better our one-year survival rates. They are therefore a good measure of how successful we are in diagnosing early. Late diagnosis makes for poor one-year figures, so we get the CCGs to focus on the one-year figure and, if there is a line of accountability there, they will be encouraged to focus on how to improve earlier diagnosis and introduce initiatives promoting earlier diagnosis.
Has my hon. Friend seen the results of the Barts Health NHS Foundation Trust’s 2013 study at Whipps Cross hospital? It showed the effectiveness of complementary therapies in improving symptom control following diagnosis. The three-year study revealed that 90% of people noticed that side-effects of chemotherapy and radiotherapy decreased following such treatment, and patients said that their pain, sleep and emotional health improved. Should we make greater use of those supportive therapies as part of the scheme of things?
We certainly have to be inclusive with regards to how we look at treatment generally. As my hon. Friend knows, the all-party group and, indeed, the wider cancer community are looking at such things. He comes to our meetings, and we listen carefully. Questions certainly need to be answered on that front, so he is pushing at an open door. We have an open mind, and we are listening.
Together with the wider cancer community—at the end of the day it has been a team approach—we have been successful in ensuring that CCGs are now held accountable. The one-year survival rates have been included in the delivery dashboard of the assurance framework, and that is very good news. Figures have only been published for the past one or two years, so we are still seeing what is happening with regards to improvements and how CCGs are performing, but at least we have made a start and there is an element of accountability.
I must of course declare that I am a dentist and so have considerable professional interest in the subject, although it is rare that I am in the surgery. I am also chair of the all-party group on skin, and one might think that diagnosing skin cancer is fairly obvious, in particular given that skin problems are a major concern of GPs. However, one of the things we soon discovered was that undergraduate tuition time on skin conditions is extremely short—often a week or two weeks, which are frequently used by undergraduates, as I understand it, as an opportunity to go away, rather than to attend. If the education of GPs and doctors was better and reinforced by continuing professional development, we might get better results on skin cancer.
I thank my hon. Friend for that intervention.
We have been successful in getting the one-year figures into the DNA of the NHS, but there is no point having the tools in the toolkit if we do not use them, and one thing we are looking carefully at is the lines of accountability. We acknowledge that we are pushing at an open door—the Government have kindly accepted the need for the one-year figures—but there is still a very long way to travel. The latest Ofsted-style ratings have maintained the focus on survival rates, and yet those ratings still found that eight out of 10 CCGs must improve. That shows the scale of the challenge and the extent to which we need to raise our game.
If I could cast the hon. Gentleman’s mind back to the previous intervention, the Be Clear on Cancer campaign identified about 700 more patients with lung cancer, which led to about 300 more patients receiving life-saving surgery. That shows that publicity campaigns work. Does he agree that the Government need to encourage the NHS to have more publicity campaigns to identify the issues and save more lives?
I agree completely. Briefly, the initiatives that could be introduced to promote earlier diagnosis are greater awareness campaigns, better diagnostics at primary care level, better uptake of screening in screening programmes, and better GP awareness—although this is not only about GPs. A whole host of initiatives could be introduced at the primary care level to improve survival rates and awareness generally. So yes, I completely and utterly agree.
Given the limited time available, I will make a little progress on the central point of this debate. We are pushing at an open door, which is fine; we are keeping a watching brief as a cancer community; and, as I have said, the Ofsted-style ratings have shown, among other things, that a big improvement is required. The all-party group on cancer will hold its annual parliamentary reception next summer—the Minister no doubt will be invited to that—at which we will focus on those CCGs that have most improved their one-year survival rates. The Britain Against Cancer conference, which we believe is the largest gathering of the cancer community in this country, will take place at the end of this year and will also focus on that issue.
We are therefore not walking away from the issue of survival rates, but we are saying as part of our watching brief that we wish to bring to the Government’s attention the fact that when it comes to cancer treatment, earlier diagnosis can not only help patients—diagnosing cancers earlier makes for better survival rates—but save a lot of money. The later cancer is diagnosed, the more aggressive the treatments and the higher the cost. That cost is quite significant, and the cost savings from earlier diagnosis could be ploughed back into treatment for patients. At a time when the NHS is under financial pressure, we suggest that too little attention is being paid to those potential cost savings. Too little work has been done by the NHS and too few health economists are looking at how reducing costs to such an extent would benefit both the taxpayer and, most importantly, patients.
Given the NHS’s lack of focus on that area, we have had to go to outside sources to give us some sort of measure of the potential cost savings. A September 2014 report by Incisive Health and Cancer Research UK showed quite a disparity between the cost of treating patients with early stage, or stage 1, cancer and those with late stage, or stages 3 and 4, cancer. For example, the cost per patient per year of treating colon cancer is £3,300 at stage 1 and £12,500 at stage 4—a near fourfold increase. Treating stage 1 rectal cancer costs £4,400; that goes up to nearly £12,000 if it is treated at a late stage. Treating ovarian cancer costs just over £5,000 per patient per year at an early stage, but £15,000 at a late stage. That report focused on four cancers: colon, rectal, lung and ovarian. They amount to only around a fifth of all cancers diagnosed, but if such cost savings were replicated across all cancers, we could be talking about savings of hundreds of millions of pounds, and that is before we even consider the number of patients who would benefit from earlier diagnosis, which Incisive Health cites as something like 52,000.
I ask for a bit of patience. Let me make a little progress, and if there is time, I will take further interventions.
That report also showed variation between the highest and lowest-performing CCGs in the proportion of patients diagnosed early. That is also important. In colorectal cancer the variation was threefold, in lung cancer it was fourfold and in ovarian cancer it was fivefold. It is clear that if we could ensure that all CCGs achieved the best rate of early diagnosis—the rate achieved by the top performing CCG—significant cost savings could be made.
Those are interesting figures. Many believe them to be conservative—with a small “c”—in the sense that we often forget the costs of treatment later on down the care pathway beyond diagnosis, but we are certainly talking about hundreds of millions of pounds. One could argue that that is a drop in the ocean when we are looking at the NHS budget, but patients—cancer patients in particular—could certainly benefit from a couple of hundred million pounds. In an age when it is all too easy for politicians to talk about spending more money, we are trying to focus on potential cost savings from encouraging earlier diagnosis. As prevalence rises—Macmillan Cancer Support believes there may be another half a million cancer patients in the next five years, in addition to the around 2.5 million we have at the moment—so will costs, so the need for such savings will grow in importance.
The most recent report of the all-party parliamentary group on cancer followed an oral evidence session with the then cancer Minister and key decision makers in NHS England, as well as written evidence from more than 30 cancer-related organisations. That report concluded that where the new initiatives outlined in the cancer strategy could save costs, those initiatives required more focus and attention. It is our opinion that there needs to be greater appreciation in NHS England and the Department of Health of the savings that earlier diagnosis offers. As I have said, there are too few health economists working in the NHS, and even fewer looking at this area.
As the Minister is well aware, when I raised that issue at Health questions last week, he correctly referred to some ongoing studies, including the three-year research project being undertaken by Macmillan Cancer Support in a related area. He also mentioned Public Health England, which is looking at cost-effective initiatives for colorectal cancers. Those studies are welcome, but I maintain that the approach is piecemeal. We need a root and branch approach to look more specifically at this area. We need to promote earlier diagnosis at CCG and health and wellbeing board level. We have the one-year figures. We must not allow this to become a tick-box exercise; the issue is far too important for that. There needs to be greater focus on how underperforming CCGs will be held to account for their rate of improvement.
The all-party parliamentary group on cancer will play its full part in that work. We are looking at other areas. We have achieved our goal of getting the one-year figures into the DNA of the NHS, and we certainly will not walk away. We are focused on several areas, including patient experience and rarer cancers. There cannot be a meaningful improvement in the one-year figures if rarer cancers are not included, as those account for more than half the cancers that are diagnosed. We will play our full part, which includes the annual reception and the Britain Against Cancer conference, but I would be interested to hear the Minister’s responses to the questions I have raised. What more does he believe the NHS can do to promote and focus on cost savings from earlier diagnosis? On behalf of the wider cancer community, and certainly the all-party parliamentary groups, including the cancer-specific groups represented by several hon. Members in the Chamber, may I request a meeting with the Minister to discuss this and other related cancer issues?
It is a pleasure to serve under your chairmanship, Mr Nuttall, in my second Westminster Hall debate since I became a Minister. I start by congratulating my hon. Friend the Member for Basildon and Billericay (Mr Baron) on securing this debate and raising the valid points that he did and on his stewardship of the APPG on cancer, which is highly effective and has provided a large part of the briefings that I have received since becoming a Minister. I very much hope that he will carry on that work, and I am sure that he will.
My hon. Friend mentioned several times the phrase “pushing at an open door,” and I reassure him that the door is open. We have discussed this issue twice in fairly formal circumstances, and I am keen to take him up on his offer of meeting him and colleagues to discuss it further and make progress over and above what we can do in Westminster Hall debates and oral questions. I also look forward to speaking at the event in December.
I will talk, as Ministers do, about the progress that we are making in this area across England, but my hon. Friend reminded us that we are not best in class or among the best in Europe, and he is absolutely right. He gave us the statistics for Sweden, where the one-year survival rate is 82% versus our 71%. That is a target; it is where we need to get to. As we have made progress, we have got to where the best in Europe were several years ago. We need to keep progressing in that respect.
My hon. Friend rightly talked about CCG accountability, and I will talk a little about that. I want to emphasise the power of what was done last month, when we published the four indicators for every CCG in the country. That is a massive commitment to transparency. We were quite open that many CCGs needed to improve. My hon. Friend mentioned the figure of, I think, 80%, which we agree with. It is worth analysing the data and spending a bit of time looking at that, because small differences in percentages against the indicators, one of which is one-year survival, make a big difference to how a CCG is perceived. Accountability comes from transparency, and we have made big steps in that regard, last month in particular.
I want to thank the Members who intervened in the debate. As ever, my hon. Friend the Member for Bosworth (David Tredinnick) reminded us of the role that complementary remedies can play as part of an overall solution. There is no impediment to that in the NHS—CCGs can commission what they wish to commission. He mentioned the Barts study. My view is that it needs to be clear that commissioning is science driven, repeatable and all that goes with that, but there is no impediment if CCGs wish to commission complementary therapies.
My hon. Friend the Member for Mole Valley (Sir Paul Beresford), in his capacity as chair of the all-party group on skin, told us how weak some of the training in that area may be at undergraduate level. I was not aware of that, so I will take it up and come back to him. It does not sound acceptable if the skin cancer diagnosis part of the syllabus is the bit that people leave.
If I could emphasise that a little more, we have a distinct shortage of consultant dermatologists. They are backed up by GPs with a special interest, but a large number of referrals to dermatologists are made due to fear on the part of both the patient and the doctor that they will miss a melanoma or a squamous cell carcinoma when the doctor should be able to diagnose them. Many are dealt with in the early stage with cryosurgery, which is a very effective, quick treatment that I know, having been on the wrong end of it quite often, can be undertaken by a GP who has had the right education.
I thank my hon. Friend for that and for reminding us that at the core of the debate is a point we all agree on: early diagnosis is the key, whether it is for cost-saving purposes—I will come on to some of the points my hon. Friend the Member for Basildon and Billericay made on that—or to be cost-effective. There is no question that early diagnosis saves lives and that it is the right thing to do. Whether we argue a bit about precisely how much money is saved is in a way a secondary issue; it saves lives and it is the right thing to do.
I also want to acknowledge the intervention of the hon. Member for Strangford (Jim Shannon), who reminded us about the need for public health and GP awareness. In England we have had a significant increase in the number of referrals and the National Institute for Health and Care Excellence—latterly in England—has changed its guidelines for referral, which, together with the awareness issue, has increased significantly the number of people diagnosed in stages 1 and 2. We need to continue to make progress on that.
I commend the hon. Member for Basildon and Billericay (Mr Baron) for leading the debate and for the leadership he has provided on one-year survival rates through the APPG. Does the Minister accept the basic premise that value of life and value for money are not in competition? They are perfectly compatible. We can have better use of money with better outcomes because of better-timed treatments, and that also means there is better evaluation and research, which will feed into better education in a virtuous circle, to meet the point made by the hon. Member for Mole Valley (Sir Paul Beresford).
I thank the hon. Gentleman for his intervention and completely agree with the point he made. In this instance, there is no competition between saving money, saving lives and doing the right thing. In a sense, there is a secondary question as to just how much cost is saved, and the balance of cost saving versus doing more diagnostically, because in order to save lives, which is a highly cost-effective thing to do and the right thing to do, we need to do more on early diagnosis.
I have not yet got to the start of my remarks and I have a lot of pages to get through, so I will not be giving too much detail. It is worth acknowledging that cancer survival rates are increasing in the UK. In terms of improvement, between 2011 and 2015 we think something like 12,000 lives a year were saved. That exceeds the goals we set out in the cancer outcomes strategy in 2011.
Last year we saw a 91% increase in urgent GP referrals of patients with suspected cancer—that is another 822,000 patients. That shows a massive increase in NHS resources and all that goes with that, and we are beginning to see those early referrals, and the different guidelines GPs are using to refer, start to come through in the one-year survival statistics. However, as my hon. Friend the Member for Basildon and Billericay reminded us, that does not mean that we are the best in Europe. We need to continue the drive to improve.
The cancer strategy produced by the cancer taskforce is the backbone of what we are trying to achieve. The—I think it is fair to say—acclaimed strategy it produced, “Achieving World-Class Cancer Outcomes”, was published last year. It had 96 recommendations in it, and the Government accepted all 96. We are now putting in place an implementation taskforce. We believe that if we are able to make the progress we expect by 2020, a further 30,000 lives a year can be saved.
Recommendation 96 is the one we are talking about today. It essentially says that we need to do a lot more on early diagnosis because of the cost savings that will potentially arise from that. There are differing views in the Department of Health as to whether for all cancer types in all instances earlier diagnosis does save costs because of the increase in cost and effort associated with the diagnosis—the early screening and all that goes with that. That was not addressed overtly in Cancer Research UK’s “Saving lives, averting costs” report, which was mentioned by my hon. Friend. He quoted numbers of several millions of pounds, and there is no doubt that stage 4 cancer costs massively more to treat than stage 1 cancer, but whether or not there are clear cost savings in all instances and even if we dispute the detail of some of those numbers, we go back to the point made by the hon. Member for Foyle (Mark Durkan) that early diagnosis is the right thing to do. My hon. Friend also mentioned that there are not enough health economists in the NHS; the truth is there are not enough of lots of things in the NHS. Early diagnosis is certainly cost-effective in terms of lives saved, even if there may be some dispute as to whether it saves costs in all instances.
My hon. Friend mentioned the work being done by Macmillan, which I acknowledge. It is a three-year study, which we are looking forward to.
I am conscious that I am eating into the few minutes the Minister has left, but the point about cost savings links to the point made earlier about initiatives and processes for earlier diagnosis. I urge him to think carefully about this, as I know he is doing. There has been no shortage of process targets in the NHS, but the one-year survival figures focus on outcomes, and that is the true measure of whether the processes are having an effect. By using outcome measures, we are leaving a large element of discretion to CCGs to introduce the initiatives they think best fit their local populations. That does not necessarily mean big cost increases to introduce such initiatives. Better awareness campaigns and better screening uptake figures do not necessarily cost a lot of money at a local level; they just take a bit of thought.
I agree completely with my hon. Friend that it is right that we use outcome measures. I come back to the point that the Government did a big thing in publishing the statistics for every CCG in the country. That allowed headlines to be out there in the press— we all saw them—that 80% of CCGs need to improve. We used a pretty rigorous test to assess the CCGs. If we reach those levels, we will be close to being the best in Europe as we make progress.
I am coming towards the end of my time. I want to finish by re-emphasising the Government’s commitment to early diagnosis. I have not had a chance to talk about our public health measures and all that goes with them, but I thank my hon. Friend again for getting us this debate. I emphasise my commitment to work with him and the APPG to make progress in this area.
Motion lapsed (Standing Order No. 10(6)).
[Mrs Anne Main in the Chair]
I beg to move,
That this House has considered healthcare provision in Devon.
It is a great honour to serve under your chairmanship, Mrs Main, which I am sure will be fair and impartial; if only that were the case elsewhere in the House. It is a particular pleasure to welcome the Minister of State, Department of Health, my hon. Friend the Member for Ludlow (Mr Dunne); I fear he has had quite a few outings already this week, and will have more. I make no apology for summoning him here, on behalf of my colleagues from Devon, to address an issue that will not go away any time soon. I suspect that this will be one of many occasions on which we will seek to ask pertinent questions on behalf of our constituents across the county.
Healthcare is one of the biggest issues in Devon, largely for two reasons. The first is the demographics of the county: 17.7% of the UK population are aged 65 and over; that rises to 21.1% in the south-west and, in my part of the south-west—East Devon—to 27.7%, which is 10% more than the national average. Secondly, reforms are coming down the line, involving bed closures and so forth, that are sometimes seen as controversial. They are a result of the perilous state of Devon’s NHS, which is there for us all to see. Before we start our long list of asks and demands, it is worth remembering that the Northern, Eastern and Western Devon clinical commissioning group’s financial deficit is due to hit £490 million by 2019, which is clearly unsustainable.
Before I launch into my pleas and points, I point out the absence of some colleagues from Devon from across the political spectrum who I know feel passionately about this. The right hon. Member for Exeter (Mr Bradshaw) and my hon. Friend the Member for Totnes (Dr Wollaston) are both detained in the Select Committee on Health. I believe that they have either just interviewed, or are interviewing as we speak, the Secretary of State for Health and the chief executive of NHS England. Of course, my hon. Friend the Member for Central Devon (Mel Stride) is unable to take part in the debate on account of his particular office. He has an excellent relationship with the GPs in his constituency, and he is supportive of wellbeing hubs, provided they serve the local community appropriately.
On the whole, we welcome the Government’s intervention in Devon’s NHS in the form of the success regime. If followed properly, it will help to solve some of the underlying problems that beset Devon’s national health service. As part of its work, the success regime, along with the CCG, has recently published proposals to close 72 hospital beds in Exeter and East Devon. The Minister will quite properly respond that that is under consultation, but I think this is the only way that we can raise these points in a public forum to make sure that everybody knows what we are thinking.
I understand that recently, the success regime, although it has a preferred option, which includes the rather expensive Labour deal on Tiverton hospital, has now introduced a “none of the above” option. If that is now an option, it creates a whole new range of possibilities. If that is not an option, I argue—my colleagues will argue for other things—that option B, which sees the beds retained in Tiverton, and also in Sidmouth and Exmouth, is the option worthy of support. Sidmouth has an extremely high proportion of over-85s, with people increasingly living longer, and of people with dementia. Exmouth is the biggest town in Devon with more than 35,000 people.
Thank you, Mrs Main, for allowing me to serve under your chairmanship. Plymouth has around a quarter of a million people, and is the largest urban conurbation in the whole of Devon.
As my hon. Friend knows, Plymouth is a unitary authority; Exmouth is the biggest town in Devon. Local people—my constituents—are hugely supportive of our community hospitals. We have beds in Exmouth and Sidmouth; in Ottery St Mary we have 16 stroke beds, although they are eventually to be replaced by a health hub; and Budleigh Salterton hospital, which I will talk about in due course, will, we hope, be turned into a health and wellbeing hub.
Over the years, many local residents have donated significant sums to the hospitals. In Sidmouth alone, the Sidmouth Victoria hospital comforts fund has raised over £5 million. Local people are prepared to invest in ensuring first-class local health services. I pray in aid the position of Sid valley Admiral nurse—the Admiral nurse helps people with dementia—which was hugely supported locally. I am pleased to say that I was able to play my part in obtaining additional funding for that position from the Big Lottery Fund. If there is an identifiable health issue locally, people are prepared to back care with their own money.
If the Minister will allow me, I will talk about the consultation process and the lack of documentation. As I understand it, the consultation process has been overwhelmingly carried out online; there are very few paper copies of the consultation. Elderly people, who may have no access to the internet and who are disproportionately likely to be affected by the changes, are therefore disadvantaged. The consultation period ends on Friday 6 January. I ask the Minister to do everything he can to look at the issue, and to work out how we can get more people involved in what is, after all, an extraordinarily important process.
The potential closure of hospital beds raises the issue of 21st century healthcare, which obviously includes preventive as well as curative care. My constituents—like many across the country, we are told—prefer to be treated at home for as long as possible. They understand, on the whole, that community hospitals need to change and adapt in order to offer a service fit for the 21st century. In Budleigh Salterton, we have been working very hard to try to ensure that the community hospital is transformed into a health and wellbeing hub, which will involve bringing together the health, social care and voluntary sectors. I think that is a good template that can possibly be used across the country. In fact, if it works, there will be far greater footfall through the community hospital than there has been while it has been just a hospital. I remain very supportive of that.
There is, of course, a negative side to keeping people in hospital beds. According to Angela Pedder, the lead chief executive of the success regime, the cost of running a 16-bed community hospital ward is £75,000 a month. Home care could look after 82 people for the same money. However, we are in danger of putting the cart before the horse. Until we can absolutely ensure that we have got social care right, we should not look at unnecessarily closing community beds that some people will have to use. Equally, I am nervous that, just because we have well-supported community hospitals across East Devon, we are being targeted unfairly, so as to rebalance the books across other parts of the county.
If we are reducing the number of hospital beds, it is absolutely essential that the social care system is able to compensate for that loss. In the past five years, council budgets for social care have fallen behind demand by £5 billion, and 150,000 fewer people receive at-home help than five years ago. Social care can take the financial pressure off the NHS. For instance, the installation of a simple grab-rail in an elderly person’s home can help to prevent the falls and broken bones that cost the NHS £2 billion a year. The option of making greater use of technology remains hugely under-exploited, in terms of how we ensure that people are getting a first-rate service at home.
I am sure my colleagues will want to raise the whole issue of rurality this afternoon. Government policies are meant to be rural-proofed. Frankly, social care is far easier to administer in a conurbation such as Plymouth than in other parts of the county, where people are spread over much greater distances.
Another issue that I am sure some of my colleagues will want to talk about is recruitment. We are told that social care will be one of the big growth industries in future. That is all to the good, and it is inevitable. However, currently, people find it very difficult to recruit. It is much easier, I am told, for the NHS to recruit people to work in social care than it is for the private sector. It is all very well transferring people back home, but only provided that there are the people to carry out the social care.
Stephen Dorrell, a former Health Secretary, has said:
“Fetishising the NHS budget and imagining it’s the only public service that relates to health is fundamentally to miss the point…It is not true to say we are supporting the health service by asking it to do social care. We are using the health service as a very expensive social care service and then talking about efficiency. It’s insane economics and very bad social policy.”
I would like to know if the Minister agrees, and what he feels can be done to ensure that we have first-class social care in place before we start to close community beds. Given the closure of residential homes, and the fact that local authorities are increasingly unwilling to pay the fees demanded by residential homes, we might end up in a situation where, although a person can no longer be cared for at home and needs some kind of hospital bed—we want to keep them away, of course, from the main hospitals—we have got rid of all our beds, or a disproportionate number, and so have created an unnecessary problem.
I want to say something about NHS Property Services. Since the NHS provider in Devon changed from Northern Devon Healthcare NHS Trust to Royal Devon and Exeter NHS Foundation Trust—at least in my part of the county—on 1 October, ownership of the community hospitals has transferred to NHS Property Services. NHS Property Services, as we know, charges commercial rents, meaning that many hospitals will have to pay higher rent. Along with the planned bed closures, that has understandably made some of our constituents nervous. What happens if hospitals cannot pay the rent? Given that the Department of Health has committed to meeting any increased property costs for 2017 and 2018, the big question is what happens thereafter.
My general practitioners at the Blackmore health centre in Sidmouth increasingly feel that they have little influence over the redevelopment of the surgery, which I champion, as a result of the involvement of NHS Property Services. The practice wants to buy the building off NHS Property Services, either now or at some stage in future. It is proving extremely difficult to make that happen. It should be a simple move, as it is supported by local GPs and the local community.
There is some concern about Exmouth—Devon’s biggest town—losing its out-of-hours GP services, which will be replaced with use of the 111 service, in line with the new integrated urgent care commissioning standards. Perhaps the Minister could write to me to reassure me that my constituents in Exmouth will receive exactly the same cover that they did under the previous arrangement.
One thing that affects all of us across Devon is the lack of provision of mental health facilities, which has exercised us for a long time. In my patch, I am concerned about St John’s Court, which is the only mental health and recovery facility in Exmouth. Two years ago, Devon Partnership NHS Trust spent £300,000 on a move from Danby Terrace, which was not at the time fit for purpose, to St John’s Court. On top of that, £140,000—this is all taxpayers’ money—was spent on refurbishing St John’s Court. Now the trust is pushing ahead with closing and selling St John’s Court. It has assured us that Exmouth will not experience a reduction in healthcare provision, and that St John’s Court will not be sold until an alternative venue can be found. We are talking about a growing town with a lot of mental health issues. I seek reassurance from the Minister that before anything is closed, something will be put in place to reassure the local community and my constituents that we have the same, if not a better, level of mental ill-health prevention and cure.
I wanted to speak for longer, but I am conscious that my colleagues will probably want to articulate their own slightly different visions for the future of healthcare in Devon. I say to the Minister in the friendliest manner possible that we are a pretty quiet bunch in our part of the world, and we do not seek trouble, but we do fight tenaciously to protect the livelihoods of our constituents. Too often, we feel that people forget about us in the south-west, and that money is diverted to all kinds of infrastructure projects in the huge urban conurbations, the northern powerhouse and so forth. This time, we will speak as one to ensure that whatever comes out of these consultations, and wherever we end up after them, we can argue these points in a mature way. It is simply no good saying, “It’s a lack of money. It’s Tory cuts.” That is an immature conversation to have. We have to, between us, design a health and social care service that is fully integrated, makes use of technology, and cares for all of us as we get older and more dependent. We need to be brave, but political sloganising is not the answer.
It is a pleasure to serve under your chairmanship, Mrs Main. May I congratulate my right hon. Friend the Member for East Devon (Sir Hugo Swire) on securing this debate on a topic that is vital for all us, right across Devon?
It will not be a surprise to anyone that I intend to focus mercilessly on North Devon and to fight our corner very hard indeed against the threat to our acute services at the North Devon district hospital in Barnstaple. Before I go into that in any detail, I want to make a couple of points. First, I would like to thank the Minister, who has on a number of occasions met myself and other colleagues in Devon to address this issue. I know he understands the particular significance of the North Devon district hospital, because I have discussed it with him, as I have with a whole slew—I am not sure what the collective noun is—of managers in the Northern Devon Healthcare NHS Trust and other directors and managers within NHS England, who by now are well aware of the strength of feeling in North Devon. I want to put it on record that the Minister has been very proactive in arranging such meetings.
My right hon. Friend the Member for East Devon talked about community hospital beds. I do not want the impression to be given that that is not a serious issue also in North Devon, although I will not be majoring on it. In North Devon, there is a bit of history. We did the heavy lifting with the loss of many of our community hospital beds about 18 months ago under a different process from the one now being undertaken in the rest of the county. I agree with what my right hon. Friend said about the need to look very carefully at the provision of social care before community hospital beds are removed.
I do not think NHS England has done this in the right order. Community hospital beds have been removed in North Devon, specifically from the Tyrrell hospital in Ilfracombe, and there is a great amount of concern among the local community about what is replacing that provision. Is there integrated and fully functioning health and social care provision in North Devon to replace those beds? My view is that the answer is no. That is also the view of the community in Ilfracombe. Last Friday I met the League of Friends of the Tyrrell Hospital, and that is strongly their view. That is not my major point today, but I want it on record that that remains a concern in North Devon, as it will become in other parts of the county.
My focus today is on acute services in North Devon. The community is extremely concerned. Many constituents have contacted me and shown their strength of feeling through protests on the street, campaign marches and letters to me, as the local MP, and to my hon. and learned Friend the Member for Torridge and West Devon (Mr Cox), whose constituents also use the North Devon district hospital in Barnstaple.
My point is absolutely clear and I will make it up front: there must be no cuts to acute services at North Devon district hospital in Barnstaple. I cannot see any clinical argument to justify even consideration of any such a reduction in services, let alone its implementation. Let me provide some background.
Healthcare in Devon is currently subject to not one but two separate review processes. We have the success regime, and the Northern, Eastern and Western Devon clinical commissioning group area was given this special treatment with only two other areas in the country—one in Essex and one in Cumbria. Because of the need to ensure that we do not fall into a future funding black hole, the success regime was implemented. I fully support that because we need this special treatment.
On top of the success regime we have a sustainability and transformation plan, which, as hon. Members will know, is being implemented in all NHS regions in England. We have this two-tier process and my understanding from conversations with NHS England is that the success regime will probably be folded into the sustainability and transformation plan, so North Devon will find itself subject to a target that we are at least more easily able to identify. The difficulty is that the ideas that are starting to emerge from the two, soon to be one, reviews are simply unpalatable for North Devon.
I put it on the record that I am fully aware that these are not firm proposals or ideas and no public consultation has been launched. None the less, what has started to emerge has, reasonably and understandably, created serious concern in the North Devon community because, looking across the piece at the various documents that have emerged from both the success regime and the sustainability and transformation plan, we see a picture that puts under threat some of the services at North Devon district hospital, which my constituents rely on most keenly and have done for generations. They include vital services such as accident and emergency, stroke and one that I want to focus on now, maternity.
I have here one of the latest documents to emerge, which hon. Members may remember. Unfortunately, NHS England decided not to make this series of documents public. I say gently to the Minister that that has not been helpful. I know it was not his direction, but it has given rise to the belief that stuff is being done in private behind closed doors and that leads to suspicions, rightly, among my constituents and the public in general. That latest document, which is about five weeks old, starts by talking about
“a two-site option for maternity”
and states that the
“Royal Devon and Exeter Hospital would most probably be the second site”—
after Derriford in Plymouth—
“rather than North Devon District Hospital”.
That is a clear indication that consideration is being given to closing the maternity unit at North Devon district hospital. That is not acceptable to my constituents and we will fight any such proposals if they come forward. We will do that forcefully for a couple of reasons.
North Devon is a special case, not least because of our geography. I have said many times in this Chamber, in the House and elsewhere that Devon has been historically underfunded, and North Devon even more so. We are and have been for too long the poor relation in public funding. Let me be clear. This is not something that has happened in the last 18 months or the last six and a half years. It has been an issue under Governments of all colours for many years, if not decades. It is something up with which we will no longer put.
Part of the difficulty of singling out North Devon and Barnstaple as a place that can apparently sustain further reductions in services is that we start from a lower base of funding than in many other regions. That feeds perfectly into the point that my right hon. Friend the Member for East Devon raised about rurality. North Devon is a largely rural constituency, and for many years a series of funding formulae have dealt unfairly with North Devon because of its rurality. There seems to have been a belief that, because we are a rural area with a sparse population, we can somehow do with less funding. In fact, the opposite is true, and I am delighted that this Government are starting to recognise that. Across the piece of funding for local government, the police, education and health services, we are starting to right that wrong and equalise that funding gap, but the history is still there and that is why North Devon is the last place where we should be looking for further cuts.
I am grateful to my hon. Friend for allowing me to intervene during his limited time in this debate, but I would like to respond specifically to his point about funding and allocations.
In the 2016-17 funding round, the allocation formulae have been looked at again and we have, for the first time in several years, introduced three differentials that are relevant to rural areas and that I think will affect my hon. Friends here. They include looking at the combination of rurality, remoteness and sparsity of population to improve the ambulance emergency cost adjustment, to reflect the greater distances travelled in rural areas; an adjustment to support continued provision by hospitals with 24/7 A&E services that are remote from the wider hospital network—my hon. Friend’s North Devon district hospital will be one of those’and an adjustment to remove from the formula supply-induced demand in urban areas where people live close to hospitals. Those three measures have led to a change and I gently suggest that my hon. Friend may care to look at the CCG allocations table which sets that out. For Northern, Eastern and Western Devon CCG, the per capita allocation for 2016-17 is £1,250, which is slightly above the average for England of £1,221 per head.
I thank the Minister for his intervention and I welcome it, but I say gently to him and NHS England, which I am sure is monitoring this, that all that good work will be entirely undone if we then lose our acute services at North Devon district hospital. This is not about figures on a spreadsheet; it is about the services and healthcare provision that my constituents will receive in Barnstable.
I am aware of the time, Mrs Main, but I want to raise a second issue, which is important and recognisable to us in North Devon, but perhaps not to those beyond: our unique geography and the distances. An Australian historian once referred to the tyranny of distance, and I think we suffer from that in North Devon. If one looks at a map, it is all too easy to think that there is a decent road network between Barnstaple and Exeter. I can give several reasons why that would be a wrong assumption. First, vast numbers of people live in isolated regions far north of Barnstaple. Secondly, the road network is not all it is cracked up to be—although that is a subject for another day and one on which I am fighting heavily.
My main point is that what no map or distance table shows is that in North Devon we have pockets of serious deprivation. In Ilfracombe, I have two of the most deprived wards in the south-west and by some metrics the most deprived in south England. In those areas car ownership is less than 80%. Put another way, one in five households do not have access to their own private transport and, because of the demographics, some of those who do are elderly and perhaps have their own vehicle but simply would not feel comfortable or up to going long distances to Exeter or Plymouth. Those two reasons alone are sufficient to argue strongly that the last place where we should be looking to make cuts to acute services is at North Devon district hospital.
I am aware of the time, Mrs Main, so I will conclude. I welcome the fact that the Government are looking at the funding. I welcome the repeated assurances that local clinicians will make the final decisions. However, I want it to be in no doubt whatever—the community of North Devon are very clear about this—that North Devon is a special case and needs to be treated as such. In that regard, I make no apologies whatever for fighting for North Devon and for appealing for there to be common sense and no cuts at North Devon district hospital.
It is a pleasure to serve under your chairmanship, Mrs Main. I congratulate my right hon. Friend the Member for East Devon (Sir Hugo Swire) on securing the debate. I will be mindful of your comments about the time. I presume that a maximum of eight minutes will be appropriate.
I am reminded that it is seven minutes. [Interruption.] The more heckling there is, the longer I might get.
For me, this debate is prompted by what is one of the greatest successes of the NHS: the fact that life expectancies are rising. In parts of my constituency, life expectancy has reached 90, and in one ward that I represent, Wellswood, 9% of the entire population are aged over 85. That brings challenges not only in health and social care, but in relation to the wider selection of services that those who have reached that age will need in order to have a whole life and not just have their healthcare needs taken into account.
Today, however, the focus is on the health service. Clearly, the proposals announced by South Devon and Torbay clinical commissioning group have created a lot of concern across Torquay, Paignton and the rest of the bay and south Devon. In fact, public concern was so great that the first three consultation meetings that it arranged in Paignton did not go particularly well. It arranged what were obviously going to be very large meetings in rather small venues, so when I attended the first one, at 9 am, I found myself, with about 40 residents, my predecessor, the former mayor and a number of councillors, plus trade union representatives, being told that the room was full and we could not go in. Things got worse at the 4 o’clock meeting. I ended up addressing more people at an impromptu meeting on the steps of the venue than had actually got into the official meeting. Then finally, in the evening, although there was a reserved seat for me, that meant that another resident was turned away because I was there speaking. It was a shambolic start to a serious consultation, but thankfully I notice the trust has now arranged further meetings.
Local concern about Paignton hospital is so great because of the breadth and importance of the services that it provides, not least the beds that many people are discharged to from Torbay hospital. When the Public Accounts Committee did its recent report on delayed discharges, Torbay had one of the best records. I am sure that my right hon. Friend the Member for East Devon would reflect that, sadly, the Royal Devon and Exeter did not. That is not so much about the hospital’s own services as about its ability to discharge to a social care setting.
We have already seen the impact that the consultation has had in terms of beds. Qualified staff have decided to seek jobs elsewhere, seeing the numbers of beds already reduced. During the consultation, the fact that there are hundreds of beds in residential and nursing care homes in Paignton was cited. I took the time to ask the obvious question: how many of those are actually vacant at the moment? The answer that I got back—this was a snapshot taken two weeks ago—was that 12 of the beds are vacant, yet two are in places that are accepting no new placements at the moment and four are in a place that specialises in caring for children. That causes real concern that we will see more delayed discharges at our local hospital if the proposals for Paignton go ahead.
Many residents of Paignton are concerned about the wider clinical services provided there, not least the minor injuries unit. The suggestion made in the consultation is that if a minor injuries unit closes at Paignton, residents will travel to either Totnes or Newton Abbot. I am sure that we will hear from my hon. Friend the Member for Newton Abbot (Anne Marie Morris) that the facility there is in excellent condition, but the reality is that that involves travelling past the acute hospital at Torbay, with its A&E department. I think it is far more likely that there will be more pressure as a result of people who would have been at the minor injuries unit in Paignton ending up at A&E in Torbay—the very place that we want to discourage people from going to unless they need to be there. There are also services such as X-rays and other clinics that many local residents find convenient and that support local GPs in delivering excellent healthcare.
My other concern about the consultation document is that although it is very detailed about what will be taken away from the south Devon area, it is not detailed at all about what will replace it. For example, there is talk of a clinical hub in Paignton, but no location. There is talk of doing more through GP surgeries, yet many of the practices are in buildings that predate 1948 and are in effect converted houses—not places that would be able to provide extended facilities for healthcare.
I find it very concerning when I speak with local people about what engagement there will genuinely be as part of the consultation, not least given the meetings arranged for small venues and the way that much of the questioning really produces only one logical answer. No one is going to say, “Yes, I’d like to spend the night in hospital,” but we would spend the night in hospital if we felt that we needed to be there. This is about ensuring that people have genuinely been able to express their views. That is why I hope that my hon. Friend the Minister will take a close look at the consultation being undertaken.
In closing, I emphasise the point that has been made about recruitment. The movement of qualified staff out of Paignton the moment the proposals to close the hospital were mooted speaks to a wider problem of recruitment across health and social care in south Devon. Although seeing the Torbay and South Devon trust receive Fair Train’s gold standard work experience accreditation last Friday was welcome, more still needs to be done to convince people that careers in health and social care are just that: careers. Many male jobseekers in particular see a job in that field as an entry-level job that they would not progress from, yet there are so many opportunities there. This is another concern for me, as it is for colleagues. We can put things down on paper, but if, in the social care market locally, there are not the providers, there is not the quality of provider and, bluntly, the vacancies that we already have for GPs are spreading across other health professions, then whatever position we come up with in the consultation will not be able to be implemented unless we address those long-term challenges in our economy.
Does my hon. Friend share my concern about recruitment in social care and care homes: that a lot of staff are, of course, from the Philippines and other countries around the world? We must all hope that that is taken into account when the UK comes up with a new immigration policy.
I thank my right hon. Friend for his intervention. It is worth saying that the outcome of the EU referendum and Brexit is probably not going to affect those from the Philippines, given that the Philippines is not a member, but I fully accept the point that we have for too long relied on importing healthcare professionals—doctors and others. We have to have a debate about whether it is ethical for us basically to be depopulating parts of the third world of much-needed doctors, nurses and other trained medical professionals and to be relying on other countries’ training schemes to provide the numbers of healthcare professionals we need. The key point is that we want our own young people to be taking up those opportunities, as well as having the services provided.
I can see you indicating that my time is coming to an end, Mrs Main, or has come to an end. I will finish with one plea: I want to see Paignton hospital and Paignton people’s services continuing into the future.
I, too, congratulate my right hon. Friend the Member for East Devon (Sir Hugo Swire) on securing the debate. Over the next few moments, I want to concentrate on NHS England’s proposals to close three GP surgeries in my Plymouth, Sutton and Devonport constituency and how I hope we can take some pressure off the principal acute hospital at Derriford in the constituency of my hon. and gallant Friend the Member for Plymouth, Moor View (Johnny Mercer).
I am told that the reason why NHS England is considering the closures is the size of the GP practices. The Cumberland GP practice has 1,800 patients, Hyde Park 2,800 and St Barnabas 1,700. They are considered by NHS England to be unsustainable and too small. It also tells me that closing those practices is not down to saving money, but to deliver better value for money. However, before I speak about those issues, let me put my constituency in context.
Plymouth, Sutton and Devonport runs from the A38 down to the sea and from the River Plym to the River Tamar. It is the home of one of the largest universities in the country, with more than 27,000 students, thousands of whom live in the city centre, and it is a naval and Royal Marine Commando garrison city, as my hon. Friend the Minister, for whom I was a Parliamentary Private Secretary in a previous life, knows only too well.
The city’s population is growing. Although it has a global reputation for marine science and engineering and research, it is a low-wage and low-skills economy. It is an inner-city seat. I do not have a single piece of countryside in my constituency, unless we include the Ponderosa pony sanctuary, which is a rather muddy field. Between Compton and Peverell in the north-east of my constituency and Devonport in the south-west, there is an 11-year life expectancy difference. Compton and Peverell is where many of the university lecturers and hospital consultants live. In the run-up to the 2010 general election, when I won the seat on the third attempt, the Conservative party pledged to do something about healthcare in deprived inner cities.
We have started to make good our word. In 2014, our hon. Friend the Member for Central Suffolk and North Ipswich (Dr Poulter), one of the Minister’s ministerial predecessors, came to Devonport to open the Cumberland GP practice, which is now under threat. Other facilities on the Cumberland campus include a minor injuries unit, the new Devonport health centre and a pharmacy. The Cumberland GP practice was set up by Plymouth Community Healthcare—now Livewell Southwest—and the Peninsula medical school. There was and is a desperate need to provide a tailor-made alternative service to the existing GP practice—then the Marlborough Street practice; now the Devonport health centre—for this deprived Devonport community, and a need to look after drug users and the city’s homeless in hostels such as the neighbouring Salvation Army’s.
The practice also offers practical placements to students at the Plymouth medical school. Until earlier this year it was funded by Livewell Southwest, a social enterprise, which found it too expensive to maintain. Despite Devonport’s real deprivation, NHS England did not want to get involved in providing a contract to the Cumberland GP practice, which has consequently been operating without a formal contract and is managed by Access Health Care.
I understand that in the past the neighbouring Devonport health practice has not been interested in offering facilities to homeless people and drug users. Indeed, I understand that some of the Cumberland practice’s patients were not keen to transfer back to the Devonport centre, which is where they came from in the first place.
NHS England’s reason for putting the Cumberland GP practice under threat is because it considers it to be too small and is operating in unsuitable, cramped premises. Unless we are very careful, we could potentially put more pressure on Derriford’s acute emergency unit, which is under enormous pressure. I became aware of NHS England’s proposals for the three GP practices in August, during the summer recess, when no doubt NHS England expected me and other MPs to be away on parliamentary trips or taking a holiday. I immediately put together a series of meetings with the city council’s director of public health, the leader of the council and the cabinet member for adult social care, people from NHS England, the dean of the medical school and Dr Richard Ayres, who runs the Cumberland GP practice.
At the meeting I suggested that the Cumberland GP practice could share Devonport health centre’s brand-new building, which has space and operates as a federation, sharing receptionists and back-room staff. This was supported by everyone present. Indeed, the city council’s health and wellbeing board also supported it following an inquiry that recommended measures to allow the Cumberland GP practice to continue. However, I understand that Devonport healthcare might not be willing to do this, and it appears that the Devonport community may be deprived of a second GP practice and that patients will have no choice in which doctor they can go to.
I have also had representations from patients at both Hyde Park and St Barnabas surgeries. At Hyde Park, although Dr Stephen Warren is keen to continue as a GP following a heart attack, he has transferred the ownership of his practice to Access Health Care, as he no longer wishes to deal with the back-room tasks of administration, which is part of running a practice. He argues that his and his partner’s growing 2,800 practice—the Cumberland is growing as well—has attracted outstanding reviews and he would not be able to inform his patients where he was going if he relocated to another practice. He also thinks that some patients like to have a relationship with an individual doctor who they can see speedily rather than having to wait weeks.
The St Barnabas surgery, which is also run by Access Health Care, was set up in a new development next to a residential care home for the elderly where patients do not have to walk far to get to it. In all three cases, NHS England, for supposedly technical reasons, gave patients only 24 hours’ notice of their initial engagement. I must say I found the public consultation process utterly appalling. I wrote to NHS England asking it to give more time to engage with local communities, and I am grateful that it bothered to listen.
On Friday, at my weekly constituency surgery, I was asked to write to NHS England to ask whether it had engaged with other GP surgeries and with Derriford hospital and whether it had consulted them, because some GPs will have to accommodate more patients. That is a big issue.
There are wider issues in all this. At the moment, commissioners in north, east and west Devon spend a higher amount of money in east Devon than in the more deprived western locality. The Government’s success regime is keen to correct that, so that resources are focused on deprived communities such as Devonport. Finally, we need to make much more use of pharmacies. As my hon. Friend the Minister knows, I am the Government’s pharmacy champion. What are we going to do to make sure we have pharmacy funding and how will that operate?
Devon shares a challenge with many other rural parts of the country. We can safely say that the things we are asking and lobbying for have a general application. From the Minister’s perspective, something that has a more general application will be much more acceptable.
We have an above average number of over-85s with complex co-morbidities, as do many other rural areas, because people like to retire to such places. We know that travel distances in Devon are particularly acute. We have been compared to Denmark in terms of the numbers of roads that we have.
It is absolutely right to raise the recruitment challenge, but it is not a simple question of not being able to get people; there simply are not enough people to get. Previous Governments have inadequately provided for training. In addition, we have the challenge of attracting people to work in a rural location. Rural locations are fine if someone is retiring there; young individuals want to live in cities; and that is the challenge. On top of that, the cost of living also makes a post in a rural area unattractive.
Perhaps the most difficult problem is the one-size-fits-all approach that previous Governments have focused on. The model for funding and for structures is built around an urban model where there are numbers and therefore productivity. The challenge we have is the lack of footfall, except in tourist times. We need to tick the box not only for the funding formula but for the new integrated models of care that look at integrating vertically and horizontally across primary and secondary care. The multi-specialty community provider and primary and acute care systems will simply not work where we are, which means that we cannot use the same solutions as other areas.
Devon is a prime example of all these problems. We have three different reviews going on. We have the success regime in north Devon; the consultation on primary care, which last year took place in south Devon and is now taking place in Northern, Eastern and Western Devon; and the sustainability and transformation plans, which have been relatively recently brought into play. As has already been mentioned, Angela Pedder, the leader of our STP, will look at combining all the reviews.
The real challenge that we face is the speed at which implementation of the changes is being considered. As other hon. Members have said, it makes it almost impossible to put in place the needed care in the community. Of more concern to me is the fact that nowhere have we really addressed the need for a proper strategy for rural healthcare. I have read the five-year plan, and the word “rural” appears three times. I have been frustrated, when I have written to the Minister’s predecessors to ask about a rural strategy, because they have told me that there is one, when the truth is that there is not. There is an urgent need for a proper review of examples from around the world—Australia and New Zealand. There are plenty of examples. Even China has a proper strategy, and other countries think about such things in a very different way. That, to me, is crucial.
The other day I attended a workshop with the Nuffield Trust, the ambulance service and a number of hospital trusts, looking at what is happening and what we need to do. In rural areas things are at crisis point. Care homes are closing and are not being replaced with new ones—at least not in rural areas. They tend to be developed in city areas. The result will be a change in the population mix in rural areas, which will lead to economic deprivation and then social deprivation. We need to accept that rural communities are different. They need to be supported; otherwise, the consequences will not be as simple as whether we lose a hospital. The taxes raised in this country are generated predominantly in the city, but we accept that they should be spent across the country; equally, that is how we should deal with our rural communities.
We should review and amend the funding formula. I am pleased to hear of the changes in allocation which are coming shortly. However, the issue is more fundamental than the funding formula. One of our challenges is the fact that the needs are different in each rural area, but training regimes have become increasingly specialised. There are many individuals who specialise, in a number of different specialisms; the current regime structure requires a certain number of specialists, in each of those specialisms, to get a tick in the box to say that an area is safe. We need more generalists, not more specialists. Several royal colleges are already considering the generalising of training, but we need conversations to happen not just within those royal colleges but between them, and Government should sponsor and support that. We also need to get acceptance within the trusts that recruit the individuals. If they will not accept the new generalists, we shall have a problem.
We need more generalists and we need more geriatricians. We also need to think carefully about how to deliver urgent care. Urgent care and accident and emergency are not entirely the same. Some of the models used in other parts of the world, such as Australia, are very interesting. It is wrong to say that if there cannot be an A & E department the hospital must go. There are many different ways to provide what we need, and we must look at that. We must also review the regulatory criteria. Regulators say, “You need a person with this job description and this expertise and training.” At the moment regulators will not allow an organisation to accept someone with the right skill mix but without the specific tick-the-box qualifications. That needs to change.
As to the care home sector, we clearly need hard measures, but we need soft measures too. The human side of social care is as important as the technical side. A challenge with respect to the agenda for integrating health and social care is to scrutinise the commissioning of social care in the same way as the commissioning of NHS care. At the moment that is not happening. I do not think I am wrong if I say that there is now a bit of a lottery, based on where people live, for how much money is allocated and therefore how good the care is.
My final plea is about the long-term plan. With increasing development and population—whatever happens about immigration—we need to ensure that we plan. At the moment, the NHS is not a statutory consultee in the planning process; and that needs to be rectified.
It is great to serve under your chairmanship, Mrs Main. I thank my right hon. Friend the Member for East Devon (Sir Hugo Swire) for obtaining this debate, which is very timely.
Consultation should be about consultation. The CCG has presented four options: in option A Tiverton has 32 beds, Seaton 24 and Exmouth 16; in option B Tiverton has 32, Sidmouth 24 and Exmouth 16; in option C Tiverton has 32, Seaton 24 and Exeter 16; and in option D Tiverton has 32, Sidmouth 24 and Exeter 16. There is no sign of Okehampton or Honiton hospitals on the consultation. Beds there are simply said to be closed. Is that consultation? In our original reforms of the health service we said that local people must be consulted. Angela Pedder did exactly the same in Axminster, two years ago, as is being done now; she just came and said the beds were to be closed. There were no alternatives or consultation—just “We have made the decision, we know best, and we will overrule anybody who says any different.”
I tell the Minister that that is not consultation; we must make sure that consultation happens. Honiton is a great hospital. It currently has 18 beds and offers midwife-led births, a minor injuries unit, therapies, outpatients, X-ray and GP-allocated primary care services. It has an outstanding reputation and is often referred to locally as the Honiton Hilton, because it provides such great services. People in Honiton have supported it for generations, and that is what is so essential. We have an ageing population in Devon. My constituency starts in Uplyme. My hon. and learned Friend the Member for Torridge and West Devon (Mr Cox) has Great Torrington in his constituency up in the north-west. Lifton is down in one corner of the county, and it goes right up to beyond Ilfracombe. The county is massive, and it is being suggested that community hospitals should be closed. The Royal Devon and Exeter hospital will be under great pressure to keep its acute beds free. Yet we are closing down community hospitals that could ease the pressure on acute hospitals. That seems to be taking things in totally the wrong direction.
I welcomed the Minister’s intervention on my hon. Friend the Member for North Devon (Peter Heaton-Jones) about the reallocation of funds. Are not the consultations therefore premature? Do they not exclude whole hospitals from being considered at all, and should not that be reviewed? Can the Minister ask for that? The independent health service review looked at the case of Torrington and said that it should not have been closed. As to Axminster, we still do not have a proper facility and we do not know how it will be engaged. Not only are the CCGs taking beds away from community hospitals; they are not putting anything in their place.
I make a plea to the Minister: what are we to do? We have an ageing population; the age profile of Axminster is probably what the whole country’s will be in 2035. Our population is healthy but growing older. We want to help people in their own homes. I am pleased for that to happen, and I think it is right, but we also need community hospitals. Honiton has excellent communications so it is easy to bring people in and out of the hospital, and it is a quick journey from the Royal Devon and Exeter to Honiton hospital if people need to be brought back to relieve the pressure on beds. I cannot see how it is possible to go forward with a consultation when a hospital is completely taken out. I am sure that the Minister will say that it is up to local people and organisations to decide; but there is a problem if, when local consultation comes along, a hospital is removed from the list. Also, when it comes to staffing, it does not help in getting staff for a local hospital if that hospital is threatened with closure.
I really feel that all our MPs across the whole of Devon need to unite, because over the last two years the number of beds in our community hospitals has been halved. I rather fear that we will be standing here in two years’ time saying that they have been halved again. Rather than fighting between each other over which hospitals are kept open and which are closed, let us fight all the closures across Devon. Otherwise we are just being picked off one by one, Minister, and this is not the way to run a health service in Devon.
The problem with North Devon district hospital has for decades—certainly for as long as I have been in politics in Devon—been quite simple: it is a general hospital that is far out on a limb of sustainability, in terms of the range of services it offers. For decades, there has been a decision begging to be taken, but it has never had the proper, honest and frank discussion that it really needs.
A general hospital generally requires something around a third of a million people to sustain it. The population of northern Devon, including Torridge and the hospital’s catchment area, is some 80,000 or 90,000 people short of the figure that generally sustains a general hospital. However, historically, it has been universally accepted that Barnstaple requires a general hospital. We cannot provide health services to the population of northern Devon unless we have an acute hospital in Barnstaple. We are therefore faced with a clear and stark choice: either make a special case for funding it in the way that a rural hospital that otherwise could not survive needs to be funded, and make it an exception to the principles that apply to general hospitals for which the population is sufficient; or see it slowly wither on the vine, dying by a thousand cuts, and by weasel words used by clever civil servants and others to justify one saving after another. Those savings really mean services reduced, and patients redirected over 40, 50, 60 or 80 miles away, with some expected to travel into the heart of Somerset for treatment that other residents enjoy on their doorstep.
I endorse what my hon. Friend the Member for North Devon (Peter Heaton-Jones) said; there are red lines for Devon’s Members of Parliament. Of course we accept that the current model of healthcare cannot be preserved in aspic. There must be change and transformation, but we cannot put accountants’ methodology over the interests of patients and the citizens we represent.
I say to my hon. Friend the Minister that I know the green and pleasant lands of Shropshire well. What a fine county it is. It, too, has had its battles on this score; I know, because I have family who live there. Let him come to Devon and see the wide distances. I do not believe that in Shropshire there is a place over 70 miles from a main conurbation, as many communities in my constituency are. Travelling 70 miles to, say, have a child delivered puts at risk and prejudices the interests of those who are to be treated.
A decision must be taken on health services in north Devon. It is the same with hospitals in the far north of Scotland; they are highly rural, deeply isolated and not sustainable unless a special formula and a special approach are taken. Words such as “care closer to home” are all well and fine, but the difficulty is that communities see an historic legacy of underfunding that has left the health authorities in our area with an £80 million annual deficit. That deficit has built up over decades of accounting measures, and of conjuring with accounts. On the one hand, communities see this vast deficit, and on the other, they hear words such as “care closer to the community,” or, “Cut your beds and we will provide you with a service that is just as good, and that better fulfils the needs of patients.” Of course we can listen to the logic and rationality of that argument, but while it is all the time moved by the spectre of deficit, they will suspect that it is being made for one reason only: to reduce the budget.
My plea is for fairness. It is a plea to be heard, made on behalf of a neglected, extraordinarily rural area—possibly one of the most rural in England. It is a plea for a special look at this problem in northern, eastern and western Devon. The language coming from well-meaning and, I accept, wholly sincere health administrators has an Orwellian flavour to it while it is governed by this shadow of deficit that hangs over it.
I welcome the news from my hon. Friend the Minister that there has been allowance for rurality in the 2016-17 budget, but one or two minor tweaks do not reverse the legacy of decades. The truth is that the health services we represent—of the people we represent—are being seen to perpetrate a grave injustice. For example, public health spending alone—spending on the prevention of ill health—in the county of Devon is less than half the national average. On any analysis, the funding we receive in Devon is wholly inadequate to deal with its wide disparities and distances, its ageing population, and the other factors that affect Devon.
My simple plea to the Minister today is to hear the voice of those whom we represent, and to hear them pleading with him. Until the deficit is addressed and there is fair funding for rural health services, we will not believe the assurances from well-meaning administrators that our health services are safe. They are not safe. We need a major amendment to the rural health funding formula; we need to improve on what has been done this year; and we need to assuage the anxieties of our constituents by a proper, demonstrably fair health funding formula.
I thank the right hon. Member for East Devon (Sir Hugo Swire) for tabling a debate on this important issue. It is heartening to see Members for Devon coming together with a unified voice on this subject. I, too, will mention Members who are not here today: the hon. Member for Totnes (Dr Wollaston), who has been mentioned, and my right hon. Friend the Member for Exeter (Mr Bradshaw). As we speak, they are questioning the Secretary of State for Health on finance for the NHS—a subject that cannot be totally separated from the issue at hand.
The healthcare challenges that Devon faces are immense, but I disagree with some of the points that hon. Members have made. I do not believe that the challenges are limited to this region; I believe they are systemic. Demand for NHS services is increasing nationally faster than ever before, fuelled in part by an increase in social deprivation and an ageing population. The need to address the increased demand, together with the need to keep pace with new technologies, is placing hitherto unseen financial pressures on NHS providers.
There are 280,000 people in Devon living with one or more long-term conditions, such as asthma, diabetes, hypertension and cancer; 150,000 people have a mental illness; and there are 40,000 people with cancer who need rapid access to high-quality services. Alongside that increased demand, there have been cuts to adult social care, and to public health and prevention budgets. If we are just to stand still, funding needs to be increased by an extra 2.6% above inflation. I am interested to see whether the Minister’s promised extra funding matches that; I doubt that it will. If no changes are made by 2020, the NHS in Devon will face a deficit in excess of £440 million.
In 2015, the Northern, Eastern and Western Devon success regime was introduced by Simon Stevens, the chief executive of NHS England, in an attempt to address the rising deficit and the failure to meet important health targets, including cancer waiting times. There is no doubt, as I am sure hon. Members agree, that there is a compelling case for change. Change is desirable; it would indeed be better for care to be more patient-centred, and of course it would be better to have more care needs met in the community. It is also true that the majority of patients receiving end-of-life care would prefer to die at home.
But, and it is a big “but”, change on this scale—massive, transformational change—needs leadership, transparency, a whole system change and, above all, investment. Making changes of this order—closing community hospitals with no proven plan for care in place—is downright reckless. That is why so many GPs in Devon are opposing the proposals, and have stated that they have
“grave concerns over patient safety.”
“we are concerned that the untried, untested closures of so many community hospital beds in this area could prove dangerous for a significant population of patients who might need to rely on community beds”.
The well-respected Chair of the Health Committee, the hon. Member for Totnes, has declared that she also cannot support the plans without an assurance that services will improve as a result of the changes.
People the length and breadth of Devon have expressed their concerns. The very active women’s institute in Devon has raised objections, as have communities across Devon. As we have heard from Members today, the consultation process has been woefully inadequate; there have been undersized rooms, and an online consultation. Frankly, it is not good enough.
Everybody is right to be worried. Only last week, the Care Quality Commission published its report, entitled, “The state of health care and adult social care in England”. The report states that
“the sustainability of adult social care is approaching a tipping point”.
In addition to the financial pressures, the sector is also experiencing massive problems with recruitment and retention of staff. The people of Devon are being asked to place their trust in a system that is on already on the brink and, quite understandably, they are not going to—and nor should they.
Local GPs have described the proposals as a “hasty cost improvement process”. This is the crux of the matter: the proposals as they stand, without adequate funding for alternative care, will save money, but they will not improve patient care, and may even compromise patient safety. I agree with the right hon. Member for East Devon that the cart is being put before the horse; that absolutely hits the nail on the head. Local NHS trusts in Devon are on their knees, desperately crying out for more funding to enable them to plan for the increased demand and changing needs of the population in the 21st century. This is not just about extra funding, but about making the kind of transformational change that is needed to deliver high-quality, excellent healthcare in the 21st century. It needs proper planning and proper systems in place, and that cannot be achieved on the cheap.
I am shocked that in this context, the Prime Minister is refusing to give the health and social care sectors more funding, which they desperately need. We have one of the lowest percentages of health and social care funding, as a proportion of our GDP, in the entire region of Europe. That cannot be right. I urge the Minister to use whatever influence he has with the Prime Minister to get her to revisit this issue, for the sake of the people of Devon, and for people across the country. This situation is not unique to Devon; we face many of the same problems in my region of Lancashire and, as I know from my work with the Health Committee, across the country.
I also ask that the consultation process be firmed up, and that people be offered a full, transparent and real consultation, rather than lip service being paid to having one. During Health questions the other day, the Under-Secretary of State for Health, the hon. Member for Warrington South (David Mowat), promised to visit Devon and to listen at first hand to stakeholders. I urge this Minister to take that away with him, and to look at making sure that the Government listen properly to the voices of Devon and the very legitimate concerns being raised in this debate. No one is trying to say that change is not needed, but one system cannot be taken away until there is a fully proven plan in place.
I am grateful to you for taking the Chair this afternoon, Mrs Main, and for encouraging me to leave some time for my right hon. Friend the Member for East Devon (Sir Hugo Swire) to respond, which I will endeavour to do. I congratulate him not only on securing this debate, which has been very well supported by his colleagues from across the county, but if I may—this is the first opportunity for me to do so publicly—on the recognition that he received of his time in Government from the previous Prime Minister.
I start by highlighting some of the excellent work carried out every day by all those who work in the NHS, not only in my right hon. Friend’s constituency but in mine and those of all the others who have spoken today. I will attempt to address some of the specific points that have been raised, particularly by my right hon. Friend, but I shall first provide the House with a little context and background regarding health services in Devon.
Devon is a leader in many areas of the health service—perhaps to the surprise of some hon. Members who have spoken—relative to other parts of the country. Not least, the Torbay and South Devon NHS Foundation Trust was the first trust in England to join up hospital and community care with social care. A plea to do that was made by my right hon. Friend and it is already happening in South Devon. The trust operates as a single organisation, working with partners to improve the way it delivers safe, high-quality health and social care. The trust is showcasing exactly the kind of joined-up, patient-centred care that we want the NHS to provide to meet the needs of the ageing population.
I also pay tribute to the staff at the Royal Devon and Exeter NHS Foundation Trust, who last month celebrated their fifth anniversary since the last incident of hospital- acquired MRSA. That remarkable accomplishment comes as the result of continuous improvements at the trust over the last 10 years. The trust is now considered a national leader in infection control, being the only general hospital in the whole of England to have avoided any MRSA infections in the last five years.
However, I absolutely recognise that the region is facing difficulties. NHS staff across the region are working hard to provide good care to patients, but services are not keeping pace with the changing needs of local people. It is becoming increasingly difficult to make sure that local people have access to consistently high-quality care that is affordable and sustainable.
As my right hon. Friend said, in June 2015, NHS England announced that north, east and west Devon would be one of the three areas in the country to take part in a success regime. That is designed to improve health and care services for patients in local health and care systems that are struggling with financial or quality problems. Following intense diagnostic work, the north, east and west Devon success regime published, in February this year, the “Case for Change” report, which was referred to earlier. The report sets out the underlying challenges facing the area and the opportunities to improve access to services and ensure clinical and financial stability. The work concluded that if nothing was done, Northern, Eastern and Western Devon would have a system deficit of £398 million by 2020/21, as has been referenced by a couple of hon. Members, including the hon. Member for Burnley (Julie Cooper).
As well as the financial challenge, the work identified significant health inequalities and some clinical services that will be unsustainable in their current form. There are good reasons for that. As we have heard from hon. Members, people in north, east and west Devon are living longer successfully, particularly in areas of the constituency of my right hon. Friend the Member for East Devon and in Torbay.
People are living with increasingly complex care needs and require more support from health and social care services. More than one in five people in north, east and west Devon are over the age of 65, and that figure will be almost one in four by 2021. Some 40% of local people use almost 80% of health and social care services. There are 280,000 local people, including 13,000 children, living with one or more long-term conditions such as asthma, diabetes, hypertension, cancer and mental illness.
Although Devon is regarded from the outside as generally affluent, we are all aware—hon. Members have explained this—that there are areas of significant deprivation. There are big differences in health outcomes between some areas, particularly in Plymouth. There are also spending disparities between different parts of the county.
More than 10% less for each person is spent on healthcare in west Devon compared with north and east Devon, even when age and deprivation is taken into account, as my hon. Friend the Member for North Devon (Peter Heaton-Jones) emphasised. Somebody living in Ilfracombe Central is statistically likely to die almost 15 years earlier than a person living a two-hour drive away in Newton Poppleford.
Inequalities need to be reduced, and the spread of health and social care across north, east and west Devon needs to be made more equal. I am sure that my right hon. Friend the Member for East Devon agrees that his constituents should have access to the same high-quality healthcare services as those in the rest of Devon, let alone the rest of the country. He referred to the success regime consultation as being at fault. I gently remind him that it was only published on 7 October. I am sure that comments made today about the lack of available paper copies of the consultation will be taken into account by the organisers, and that we can respond to that.
I heard my hon. Friend mention the lack of reference to Okehampton and Honiton. I gently draw attention to the fact that the option to retain community beds in both those hospitals was considered as part of the 15 options in the document. The option was rejected as one of the four recommended for consultation, but that does not prevent him, his constituents or local representatives in those areas from putting those alternative options forward.
My right hon. Friend the Member for East Devon asked whether there was a “none of the above” option. I think he may have been referring to page 42 of the consultation document, on which the organisers say that they
“welcome all views and will carefully consider all responses and analyse these against the decision making criteria. That will include options which are not currently in the consultation document”.
They are open for proposals to be made by others, but those need to be looked at in the context of the criteria.
My right hon. Friend would not expect me to be drawn on any of the specific options. I would not want to be seen to be influencing the consultation prematurely or, indeed, at all until we see the recommendations that come out of it.
It has come out of the investigations leading up to the consultation that every day more than 500 people in north, east and west Devon are being cared for in a hospital bed who do not need to be there. That is at the heart of the challenge that we face not just in Devon but across the country, as the hon. Member for Burnley mentioned.
The system is keeping people in community beds or acute beds longer than they need to be because of discharge challenges. That gets back to the initial remarks of my right hon. Friend the Member for East Devon about whether we are integrating the consultation properly with improvements to social care. It is important, when we come to look at the recommendations arising from the consultation, that we take into account the capacity that will need to be created in social care to provide alternative models of care if the number of beds is reduced.
The formal consultation concludes on 6 January. As I have said, I will not comment on specifics while that is under way, but I strongly encourage my right hon. Friend, all other hon. Members who have spoken in the debate, and those who were not able to because they are elsewhere in the House today to ensure that their views are taken into account. The next phase of the success regime will look at how services are provided in acute hospital settings, as my hon. Friend the Member for North Devon highlighted, as did my hon. and learned Friend the Member for Torridge and West Devon (Mr Cox) in his characteristically robust contribution. I am sure that they will make their views known in the consultation that we anticipate will follow next summer, and the clinicians involved with the acute services will be preparing their recommendations.
My right hon. Friend the Member for East Devon is aware that the success regime plans are part of a broader sustainability and transformation plan that covers the whole of Devon. That creates the opportunity for health and local authorities—not just NHS bodies but local authorities with responsibility for social care—to work together to try to formulate plans that give care packages the kind of integration and coherence that hon. Members have sought for Devon. It will build on the work that has been done by north, east and west Devon’s success regime and on the “Case for Change” published by South Devon and Torbay CCG in September. The latest iteration of the plan is due to be submitted to NHS England this Friday.
Before I conclude, I can confirm that I will write to my right hon. Friend on the Exmouth out-of-hours service. I understand that he has a meeting with the Minister responsible for NHS property services later this month, so he will be able to take up his concerns then. On other challenges that were mentioned, we recognise that there is pressure on recruitment and retention of clinicians in rural areas. Hon. Members will be aware of the announcement made by my right hon. Friend the Secretary of State to try to recruit 25% more doctors over the next few years; of our plans to recruit up to 10,000 more nurses over this Parliament; and of the announcement, last week, that we will be introducing a new category of nursing associate to provide more capability. We are acutely aware of those needs.
It is the responsibility of local NHS organisations to determine how local services are delivered. Hon. Members have made some important points, and I urge them to do so as part of the consultation. I hope that we will have another opportunity to discuss the forthcoming recommendations.
I am grateful for an interesting and mature debate. The Minister has an invidious job of trying to reconcile the competing demands across the country, to say nothing of the competing demands across God’s own county of Devon. I can think of no better man to attempt to do that. If the consultation is a genuine opportunity, and is not an excuse to reduce levels of care, the Minister will find us supportive. He will find us supportive if, as I suspect, the consultation is an opportunity to deliver a fully integrated hospital, and a community care and social care system, that is fit for the 21st century.
I am pleased to remember a conversation I had with the Secretary of State, who repeated his commitment to community hospitals. I leave the Minister with one thought: as the previous Prime Minister freely admitted, it was the Conservative party in the south-west that delivered a victory at the last general election. The Minister has seen how formidable we can be when we come together, and come together we will to protect our vital services for our constituents across the county of Devon.
Motion lapsed (Standing Order No. 10(6)).
[Mr Philip Hollobone in the Chair]
I beg to move,
That this House has considered policies, strategies and funding for environmental protection.
Like many MPs, I have a constituency with a large number of local nature reserves, special areas of conservation and two national nature reserves, one of which, Kenfig, is also a special area of conservation under the EU habitats directive, the Bridgend biodiversity action plan and the UK biodiversity action plan. It is a site of local, Welsh and European nature conservation importance. I have secured this debate to ask questions on the future protection of these sites and others like them across the UK, which urgently needs addressing following the Brexit decision.
I begin by recognising the excellent work of members of the Select Committee on Environment, Food and Rural Affairs and the Environmental Audit Committee and by acknowledging their lead in this field. The EAC’s report on UK and EU environmental policy should have been compulsory reading before voting in the Brexit referendum. We need answers to questions such as whether we have the technical, financial and legal expertise and capacity to respond to the environmental challenge of Brexit. The Wildlife Trusts, including my local Glamorgan wildlife trust, have said:
“The EU has the single largest body of environmental legislation in the world.”
The EU has had an exceptionally positive impact on our efforts to produce policy, influence development and safeguard our wildlife.
One conclusion of the EAC’s report is that
“the UK’s membership of the EU has improved the UK’s approach to environmental protection and ensured that the UK environment has been better protected.”
Many witnesses implied that if the UK were free to set its own environmental standards, it would set them at a less stringent level than has been imposed by the European Union.
My constituency contains the Newport wetlands, the Gwent levels, the River Usk and more. We should acknowledge that the Welsh Government have taken a great lead on environmental legislation in the UK. However, they can only do so much. Does my hon. Friend agree that, as with the Brexit negotiations generally, it is crucial that the Government work closely with the Welsh Administration in Cardiff for the good of the environment in Wales?
I intend to address that later in my speech, but it is a central part of the way forward as we find our way through the tangle that is Brexit.
The UK imposing less stringent levels of environmental protection was a major concern for the people who approached me to initiate this debate. I was asked how confident we could be that nature conservation would be protected and a priority post-Brexit. Lest we forget, in the biodiversity intactness index, which assesses how damaged nature is across the world, the UK is ranked 189th out of 218 countries—we are not exactly doing well at the moment. France and Germany are miles ahead of us because we have been less vigilant in implementing EU environmental legislation. It is clear that there was little thinking about what would happen if the UK voted to leave the EU and what the decision would mean for this policy area.
It is difficult to draw a clear conclusion until we know the terms of our exit, but it is vital that we have an assurance today that EU environmental legislation will be maintained in its entirety so that we have a semblance of stability and breathing space while we develop our own mechanisms and expertise. There are concerns that a full transfer post-Brexit may not be practical, that much of the transfer of directives might be done with little scrutiny through secondary legislation and that this may lead to the weakening of directives. I hope that the Minister, when she arrives, can tell me how she will ensure that that does not happen.
We need to know how we will update legislation and ensure progress. We need a commitment from the Minister that, as an absolute minimum, existing levels of protection for species, habitats and the wider environment will be maintained, and will not be weakened in the longer term through our inability to update legislation or through a lack of enforcement controls.
Richard Benwell of the Wildfowl & Wetlands Trust reminded me that:
“EU law is not some static monolith with commandments set in stone, it is an evolving regime brought to life by shared objectives and the rulings of the European courts. Without the trajectory provided by the Commission and the accountability provided by the courts, there is a risk that EU legislation becomes out-dated and unenforced, a kind of ‘zombie legislation.’”
I hope that the Minister will be able to tell me how we are going to enforce legislation. The EU’s mechanisms of oversight, accountability and enforcement ensure that robust implementation and monitoring take place. What will be the legal recourse for those concerned about the loss of important habitats and species? Judicial review is costly and out of the reach of most citizens and non-governmental organisations. Brexit means that we will lose two key accountability mechanisms: the European Court of Justice and the European Commission. What will we replace them with? What will fill that vacuum? We need a commitment that any future changes to this legislation will be subject to robust scrutiny and debate, with provisions for legal challenge to ensure that there is no attempt to roll back environmental protection.
How are we going to fulfil our international obligations? Brexit will not change our obligations such as those under the Bern, Rio and Ramsar conventions, yet once we leave the EU we will not have the support that membership offers in relation to those agreements. How will we meet them? How will we avoid fragmentation in the UK? What plans does the Minister have to quickly develop common values with the devolved Administrations, which my hon. Friend the Member for Newport East (Jessica Morden) mentioned? Much of our environmental policy is entirely devolved. The Royal Society for the Protection of Birds argues that transferring EU legislation will require changes to the Scotland Act 1998. We need to know whether the Minister is prepared for that.
Where will the needed capacity and technical and scientific skills come from? The Environment, Food and Rural Affairs Committee has noted:
“The Department’s…resource spend over the last Parliament includes cuts of £254 million… Defra’s main resource budget will reduce in 2015-16 by £135 million, or by 7%”.
The 2015 spending review announced that that budget will be reduced by a further 15% over the next few years. The Minister needs to tell us how we are going to replace the range of technical and scientific capacity and skills that will be lost when EU expertise is no longer accessible. Will any of the promised battle bus money come to DEFRA?
Local authorities are at the forefront of environmental protection, given their key role in deciding planning applications. Research commissioned in 2012 by DEFRA established that good outcomes for biodiversity are most likely to be obtained when expert ecological advice is available to the local planning authority.
As the hon. Lady may be aware, I have joined a big campaign for the future of hedgehogs, numbers of which have unfortunately declined by about 50% over the last 15 years. It would be useful if local authorities had policies to ensure that they have hedgehog superhighways.
I will come to that eventually, if the hon. Gentleman gives me a little time.
I was discussing making expert ecological advice available to local planning authorities to enable them to develop sufficient ecological information and understand it when considering planning applications. Local authority ecologists currently play a vital part in the process, helping to guide developers towards sustainable solutions that enable development and protect our most valuable natural assets. In the post-Brexit environment, how well equipped will local authorities be to provide expert advice on the natural environment? Not terribly well, particularly given the dire situation that has developed over the past few years.
The Association of Local Government Ecologists, aptly called ALGE, found as far back as 2011 that only 35% of local authorities in England employed an ecologist; perhaps that is why we do not have hedgehog superhighways. ALGE’s conclusion was that
“local government’s capacity to assist in the delivery of a wide range of biodiversity initiatives”,
such as hedgehog superhighways,
“is already limited and is being further eroded”.
ALGE sounded a warning bell, pessimistically concluding that if the capacity of local authorities was in such a state in 2011, the unrelenting pressure on local government budgets would not give the situation any chance to improve.
Local environmental audits are essential if planners are to know how to manage favourable conservation status legislation, which was designed to protect at-risk species such as great crested newts and bats. Environmental audits are essential. If we do not understand the local populations of such species, it can result in overcompensation in planning decision making. Will environmental impact assessments become irrelevant if we do not adapt and update them, as would happen if we were in the EU?
Does the Minister know how many local planning authorities now have access to their own ecological expertise? Are the Government able to review whether capacity is currently adequate and consider what improvements within the system might be achieved if more LPAs had access to their own expertise? How much more effectively could the Government aims and objectives set out in the 2011 natural environment White Paper “The natural choice” be achieved with just a modest increase in ecological resources within local government? I hope that the Minister will assure us that DEFRA’s proposed new 25-year environmental plan will give true recognition and resources to support the important role that local authorities can play within this vital new initiative.
We need to know who will be responsible for dealing with legislation, regulations and concerns raised by industrial chemicals and pesticides. At present, we follow EU-wide regulations that protect human health and the environment from dangerous chemicals. The vast majority of our expertise in chemicals and pesticides is based in the EU. Can we replace it? Can we afford to? We are already facing a scientific brain drain thanks to Brexit. Does the Minister have a plan to recruit the skills, expertise and competencies that her Department needs?
In February 2013, the Government published the UK national action plan for pesticide use, to fulfil a requirement under the EU directive on the sustainable use of pesticides. It is another example of the UK’s half-hearted response to environmental legislation. Buglife stated:
“The plan lacks ambition and fails to set out a clear direction for achieving sustainable use of pesticides and preventing damage to pollinator populations.”
Who cares? We all do; we all must. Wild pollinators in the UK include 250 species of bumblebees and other bees, 2,600 species of butterflies and moths, and 7,010 species of flies and various other insects such as beetles, wasps and thrips. Some 84% of crops and 80% of wild flowers rely on pollinators; they are worth a minimum of £430 million a year to the UK economy. How will we influence EU pollination action plans? In the 2016 national pollinator strategy, the Government promised £691 million for agriculture to support the plan. When will the funding start, and how long will it last?
What will we do about invasive species? Currently, we deal with them at EU level. We often work with Ireland in adding new species to the list; how will we move that forward? How will we comply with ESTA, the European seed treatment assurance scheme? To quote the industry:
“Any serious incident in an individual member state could again lead to product withdrawal. In addition, there is a need to ensure free movement of treated seed across the Community unhampered by individual Member state legislation.”
After Brexit, it will not be possible for the UK to develop UK-only seeds. On fisheries, we might be able to set quotas, but we will not be able to influence EU quotas. Does the Minister know what British waters will consist of? Will it be 12 or 200 miles? How will we ensure that stocks are not put under pressure?
Non-governmental organisations and their volunteers already plug major gaps. An estimated 7.5 million hours are given to species monitoring each year. NGOs are reporting being approached by local government to take over responsibility for managing local nature reserves and even national nature reserves. NGOs currently employ much of the UK’s environmental and scientific expertise. Will the Minister pledge to work with those NGOs in agreeing a way forward?
Why is any of this important? The “State of Nature” report findings show that in the UK alone, 10% of species are at risk of extinction and nearly 60% have declined since 1970. We face increasing problems of air and water pollution. The focus in the Brexit debate to date has been on the economy. Whatever “Brexit means Brexit” means, it does not mean habitat and species loss, more air, chemical pesticide and water pollution or more invasive species. Does the Minister have a plan, and when will she share it with us?
Finally, I have been asked to make a personal plea from Mr Stanley Johnson, one of the authors of the EU habitats directive. He is especially keen on continued UK participation in the Natura 2000 network of protected areas. I agree totally, and I hope that the Minister will include that in whatever plans she outlines to us in her response.
I apologise to the hon. Member for Bridgend (Mrs Moon) and to the House for my discourtesy in arriving late. Unfortunately, something happened en route. I will send my apologies personally.
I thank the hon. Lady for those kind words. She has chosen an exceptionally important topic for discussion. I am grateful to her for sharing some of the themes of her speech in advance, so that we can give her as comprehensive an answer as possible. A lot of this is still in formulation, but I am conscious that the questions and issues that she raised will be absolutely central to some of the answers that we hope to find as we develop our route out of the European Union. I hope that she will continue to take an interest in this topic over the next few years. On our exit from the European Union, she asked how European legislation would be transferred into national legislation, and what the implications were for nature conservation. She also asked specific detailed questions.
I reiterate from the outset our absolute commitment to delivering on our manifesto promise to be the first generation to leave the environment in a better state than we found it. Even before the EU referendum, work had started on developing our 25-year environment plan to deliver against that target, building on our 2011 natural environment White Paper.
I fully recognise the importance of devolved policy in this area, and as the hon. Lady represents a Welsh constituency, I cannot be entirely specific about the situation directly affecting her constituents. Instead, I will develop more broadly the argument about the UK Government’s role in leading the work to exit the European Union; I will also refer to some of our plans in England. We have been able to increase spending in the past five or six years, and any decisions we make in the future to increase expenditure will result in changes that the Welsh Government will be able to take advantage of to continue to enhance the wonderful environment across our country.
Understandably, the decision to leave the European Union has raised questions about what might change, and what leaving might mean for the environment. The Government are well aware of the desire for certainty about what Brexit means for our environmental policy and legislative framework. The Prime Minister recently announced our plans for the great repeal Bill, which will not repeal all the protections given to the environment over many years—there are protections that predate our joining the EU, by the way—but will repeal the European Communities Act 1972. The Bill will be specifically about how we take European law into British law—whether that is Scots law, English and Welsh law, or the legislative framework for Northern Ireland—and will ensure that, the day after we leave, we still have an enforceable legislative framework, and that the environmental protections that we take for granted will continue.
Without prejudging our future relationship with the EU or future decisions of Parliament, I want to provide as much certainty as possible about the fact that we expect existing laws to be applicable. A smooth and orderly exit is in the interests of both the UK and our EU partners. There are decades of EU law to consider, and about a quarter of EU legislation affecting the United Kingdom affects the Department for Environment, Food and Rural Affairs. We want to ensure that the statute book works on exit, and that we provide the maximum possible stability. We will engage widely, including with Parliament and the devolved Administrations, on the plan to ensure that when EU law ceases to apply, it is converted into domestic law. All Departments are reviewing the EU laws that apply in their policy areas and how withdrawal from the EU will affect their operation. Some elements of EU law are directives, which have to be transposed into UK law, and others are regulations. We need to ensure that no gaps are left.
I stress the considerable technical expertise to which all devolved Administrations have access. The Joint Nature Conservation Committee advises the UK on nature conservation, and the Health and Safety Executive advises on pesticides and chemicals; I see both organisations playing an important role, especially in regard to the hon. Lady’s concern about keeping the integrity of the United Kingdom. While we may be leaving the European Union, we are keeping the United Kingdom, and we know that the environment does not stop at the border.
As the Prime Minister has signalled, we will no longer be subject to the jurisdiction of the European Court of Justice. It will be the role of Parliament to hold the Government to account, along with mechanisms such as judicial review, though I recognise that that is costly, as the hon. Lady said. Understandably, people talk about the role of the European Commission and the ECJ, but their procedures still require people to initiate them. There are non-governmental organisations that are certainly not shy about taking the Government to court on certain matters, but at the moment, they can also use the avenue of the European Commission to do that.
The decision to leave the EU means that we have quite an exciting opportunity to design a set of environmental policies linked to the UK’s needs in the context of the 25-year environment plan. The hon. Lady and I were both remain campaigners and voters, but leaving the European Union will allow us, in due course, to consider whether the prescriptive nature of some of the current directives is the best way to achieve the outcomes we want. A phrase I often use nowadays is “cling to nurse for fear of worse”. Sometimes it felt as if that was the theme on which the remain campaign was based, but the phrase also sums up how people have clung to directives instead of thinking beyond them, saying, “We know that there are directives that are no longer fit for purpose, but there is no appetite to change them.” We want to ensure that any changes in the law are subject to appropriate scrutiny and debate.
The hon. Lady raised a number of detailed points about matters that are still being worked through. It would not be right for me to provide a running commentary, because there is no commentary; the options are still being worked through. She referred to the UK’s international commitments. A lot of European legislation is arrived at by multilateral agreements to which we have already signed up. We will certainly continue to honour our multilateral environmental agreements, which have been reached as a result of global action on environmental protection. We will continue to work closely with our European and international partners to improve the environment.
I stress that this area is a shared competence. Take plastic bags; the Welsh were the first to take action, and England eventually followed. That issue was being discussed just yesterday at the European Council in Luxembourg, and I was able to say, “The United Kingdom has already taken unilateral action on this, and other countries can do that if they wish—they do not need to wait for the EU to legislate on it.” Well done, Wales, for showing the way.
Marine conservation zones are another example. We have created our own designations, so we do not entirely need to rely on Natura 2000 and other elements. Some of those sites are already in place anyway because of international agreements, but we need to work through the designation framework for sites of special scientific interest and areas of outstanding national beauty. Our recently launched national parks plan is a good example of good practice: it continues to outline and enhance the protections we will have, as well as encouraging children to connect with nature.
We have all sorts of unilateral initiatives; I am sure the hon. Lady will welcome, and will contribute to, our consultation on banning the sale and manufacture of personal care and cosmetic products with microbeads. We recognise her point about the “State of Nature” report, and we want to ensure that the environment will be at the heart of any future replacement we design for the common agricultural policy. As she says, there has been a decline in species; we are determined to restore them. We have certainly seen some changes over recent decades, and we need to address them now. As I say, the environment plan and the framework, which I really hope will be published soon, will be a good opportunity to contribute to how we deliver that. I recognise that the environment plan is for England, but I am sure that other nations of our United Kingdom may wish to consider it.
The hon. Lady asks whether it is joined. I am sure that we will not be violently misaligned, but as I said at the start, this is a devolved matter, so we cannot dictate our policy to Wales, Scotland or Northern Ireland, though I am sure that they will watch our plans with interest.
The hon. Lady raised the issue of invasive non-native species. The UK has long been the leading player on that issue within the European Union. The recent EU regulation was based heavily on our strategy for this country, which in turn is based on international principles acknowledged by the convention on biological diversity. We are committed to continuing that approach.
On funding via the national pollinator programme, the countryside stewardship agreements in the pipeline are now guaranteed. The Chancellor has also stated that new rural development programme projects signed after the statement will be funded, as long as they are good value for money. On local planning authorities, I take the hon. Lady’s point that only about a third of councils employed an ecologist. People can buy in the resource, and they do, but I recognise her point.
I do not have time, I am afraid.
The hon. Member for Bridgend will also want to know about trialling a more strategic approach to great crested newts in Woking, which should result in an overall net benefit to the population and to planning restrictions. I will write to her about the fisheries policy. In conclusion, I appreciate her patience, and assure her that we will continue to engage with the public and stakeholders.
Motion lapsed (Standing Order No. 10(6)).
Type 26 Frigates: Clyde
I beg to move,
That this House has considered the timetable for building Type 26 frigates on the Clyde.
It is always a pleasure to see you in the Chair, Mr Hollobone, but for the record this debate is on Type 26 frigates.
Talk of defence platforms can often be a dry business, and it passes by most people in this House, never mind among the public. That is not true of the Type 26. The interest we see among Members today in the global combat ship reflects not only its strategic utility and world-class design; the farrago of delays and under-investment in the project and broken promises from the Ministry of Defence reveal the malaise at the heart of the United Kingdom’s strategic thinking, which sees preserving the shop window as more important than its most basic of roles: defending this political state adequately.
I would like the Minister to address with utmost sincerity—something that her Department has been unable to do up to this point—two principal points on the Type 26 project. First, in delaying the start of the project, the Minister and her Department are doing enormous damage to the defence of Scotland and the United Kingdom, which, as I mentioned, is one of the Government’s most solemn and fundamental tasks. Secondly, the failure to cut steel on the vessels, alongside an ongoing refusal to fulfil the promise of a frigate factory on the Clyde, is placing enormous pressure on the complex warship-building capacity that Government have unequivocally promised to protect, causing undeniable financial harm and insecurity to the thousands of skilled and dedicated workers from along the Clyde who are feeling increasingly let down.
In short, behind the broken promises and procrastination, the MOD has proven beyond doubt one maxim put forward by myself and Scottish National party colleagues time and again: every penny spent on the abomination that is Trident is a penny less spent on conventional defence.
In beginning to pick apart the sorry saga of the Type 26, one has to start somewhere, and I choose to start with the Royal Navy taskforce that sailed to recapture the Falkland Islands in 1982. That taskforce was composed of some 23 frigates and destroyers; today, the entire Royal Navy boasts only 19 frigates and destroyers, of which all are based between Her Majesty’s Naval Base Portsmouth and Her Majesty’s Naval Base Devonport. Paradoxically, that leaves the United Kingdom’s southern coast as its most northerly complex warship base.
Is the hon. Gentleman not aware that the submarines are based up in Scotland? They are coming, in the main, away from Devonport, and we are still responsible for the refitting and refuelling of the nuclear submarines.
The last time I looked we were discussing the construction of naval vessels, not the basing of weapons of mass destruction. Nevertheless, I am delighted that the Conservative party wants to engage in a strategic look at shipbuilding, because Conservative Members were recently in this very Chamber talking about rebuilding the royal yacht Britannia. While they are away and on into the distance with their pith helmets, the rest of us are left behind with the catastrophe that is Brexit, which I will pick up on later. They can go on to the distance in Britannia.
The capability gap is felt most keenly in Scotland. The northern third of this island, with a coastline longer than that of France and direct access to both the North sea and the Icelandic gap, is left dangerously under-defended at a time when Russian Federation incursions into our territorial waters are beginning to reach cold war levels. The perfect example came in January 2014, when the Russian carrier the Admiral Kuznetsov “took shelter” in the Moray firth. It took the United Kingdom’s fleet ready escort 24 hours to reach the carrier group before it went on its way—although not before dumping its waste in the firth.
The House may have read the recent reports of the Kuznetsov’s imminent return to the waters of the North sea. The carrier group left the port of Severomorsk on Sunday and is expected to make its way towards assisting Russia’s continuing destruction of Aleppo via the North sea and English channel.
A headline in the Norwegian press this week says: “Russia’s biggest warships steam along coast of Norway towards Syria”, just as my hon. Friend has described. The related article says:
“Norway has a frigate, Coast Guard vessels and Orion surveillance aircrafts that have all followed the Russian navy group since it sailed out from the Kola Peninsula into the Barents Sea on Saturday.”
Does he agree that that is a substantial contribution from Norway, and one that the UK would struggle to match?
I certainly do agree with my hon. Friend. That small northern European nation seems far more capable of defending its territorial waters and meetings its obligations to NATO than the United Kingdom.
Amazingly, despite long-standing knowledge of the Kuznetsov’s deployment, and it coming as NATO’s largest annual exercise is taking place in Scotland, the Government have been able to rustle up only one Type 23 frigate and one Type 45 destroyer to escort the carrier group through the UK’s exclusive economic zone, meaning that were the group to split, there would be no way of keeping tabs on the largest ships in the Russian navy. Quite simply, the ageing Type 23 fleet cannot keep pace with the growing number of tasks put forward for it. The understandable challenges of dealing with a 35-year-old platform have led to worrying gaps in the Royal Navy’s most basic capabilities, whether that is the designated fleet ready escort being neither a frigate nor a destroyer, or the frequent and worrying absence of a UK vessel from the NATO standing maritime group in the north Atlantic.
The Government’s contention that a smaller fleet can be justified by increasing versatility can be met only by proceeding with the Type 26 programme. These are highly capable, versatile, multi-mission warships that would give the Royal Navy the capabilities it needs. Talk about the United Kingdom offering NATO a world-class anti-submarine warfare capability sounds hollow when we do not invest in the primary platform to undertake that, and when investment in other platforms—whether that is the carriers or the Poseidon P-8 maritime patrol aircraft—is called into question because a fundamental part of their support network has been put at risk.
When the Minister responds to the debate, I hope to hear a real commitment to a timetable for cutting steel on the ships, as well as their expected in-service dates.
Does my hon. Friend agree that the delay in giving such a guarantee is an utter betrayal of the workers on the Clyde? It really calls into question both the UK Government’s commitment to conventional defence capability in Scotland and where their priorities truly lie.
I have great respect for the hon. and gallant Gentleman, but if we get rid of Trident we might actually be able to cover that.
In introducing this debate, I not only raise to a wider audience my own concerns about the continuing delays to the project, but echo the concerns of the Defence Committee and many prominent former senior Royal Navy officers. When the former First Sea Lord, Admiral Lord West, appeared before the Defence Committee at the start of June, the response to my hon. Friend the Member for Dunfermline and West Fife (Douglas Chapman) was that the Ministry of Defence had run out of money for these ships. We were never really given an acceptable answer from the Minister’s Department. Indeed, Admiral Lord West pre-empted the MOD response by expressing the opinion that any contention by the MOD that the problems were principally with the design would be “economical with the actualité”.
Today I will go even further than Lord West and ask the Minister specifically to address the concerns that have been put to me that the scandal of the lack of any timetable for construction of the Type 26 actually masks a wider problem of a continuing lack of investment in the Clyde yards, putting their long-term future at risk and jeopardising the jobs and skills of thousands of workers at Govan and Scotstoun.
In the lead-up to the announcement of the plans for the Type 26 programme, the workers at those two yards were offered a clear quid pro quo. There would be a significant restructuring in the workforce, including job losses, but that would be offset by investments that would guarantee jobs for a generation. At the height of the referendum on Scottish independence, the Minister’s Department explicitly tied that investment to the no vote. There would be 13 Type 26 frigates built on the Clyde, in a brand new “frigate factory”, to protect the workers from the west of Scotland’s rather inclement weather.
When we heard last November in the strategic defence and security review that the number of Type 26s being built would be reduced still further, trade unions told my Scottish National party colleagues—and others, I am sure—that that was not a huge concern, because the infrastructure investment for building the Type 26 would ensure that the new general-purpose frigate would also be built on the Clyde. So the Clyde waited—and waited, and waited—until the planned date for the cutting of steel came and went, until it emerged that there was a £750 million gap in infrastructure investment and until it became clear that the UK Government were rubber-earing our questions about the GPFF being built on the Clyde.
This is a tale of underinvestment and neglect, and I can relate to it. Perhaps—just perhaps—this is a deliberate Tory strategy, and one that has form on the Clyde. The Minister may not remember the names of former Ministers; on these Benches, we will not forget one: that of Nicholas Ridley. When Jimmy Reid, the late patriot, presented the Ridley letters, which were written in 1969, to the Scottish Trade Union Congress, they proved that the Tory Government had outrageously planned the closure of the Upper Clyde Shipbuilders. By their inaction, this Government are following a well-trodden path in this regard. The Tories are making a political decision, rather than a strategic one.
In the context of current naval investment, the delay in building these vessels could be seen as excusable if there was an understanding that the ministerial promises to the highly skilled and dedicated workforce of these yards would be upheld. The fact is that these workers and my colleagues are all listening with increasing concern to the Government’s deafening silence on the subject of the GPFF, and although we appreciate that there is a shipbuilding strategy to come in November, the MOD must at least give reassurances before then.
However, even as workers on the Clyde work outside in all weathers, the Government have not been slow in coming through with investment elsewhere. In Barrow, those workers who are working on the multi-billion pound Successor programme to Trident are being kept dry by the Government investment there, which includes an indoor assembly hall. There could be no better illustration of my contention that every penny spent on Trident is a penny less spent on conventional defence. Trident costs have not always been part of the MOD budget, but now that they are, the Government’s intention to ring-fence the MOD budget and other budgets has led us to this inescapable conclusion.
It may not come as a surprise to hear that me say that, as I am a member of the Scottish National party, but I am echoing the assessment made by General Sir Richard Shirref in front of the Defence Committee last year, and the assessment of General Sir Richard Barrons, which was revealed in the Financial Times in September. Vital capabilities such as the Type 26 have been “withered by design”, as a result of the MOD priorities that place unusable weapons of mass destruction above the defence of the state. “Preserving the shop window” means workers on the Clyde worry about their job security as vital infrastructure investment is kept to a bare minimum.
I will end my opening speech by reiterating the two questions that I hope the Minister will address. First, how will the UK Government address the worrying gaps in national security caused by the ongoing failure of the MOD to build the Type 26 on time? Secondly, will the Minister give the workers of the Clyde a timetable for construction of the Type 26 and address their concerns about the total and complete lack of investment in infrastructure to support the GPFF, which would guarantee their job security beyond the medium term? I await the Minister’s answer; they await the Minister’s answer.
The guideline for Front-Bench responses is five minutes for the Scottish National party, five minutes for Her Majesty’s Opposition and 10 minutes for the Minister. Therefore, I will call the Front-Bench spokespersons no later than 5.07 pm. Mr Docherty-Hughes will have three minutes to sum up the debate at the very end. The time between now and 5.07 pm is for Back Benchers.
It is a pleasure to speak in this debate, Mr Hollobone.
First, I thank the hon. Member for West Dunbartonshire (Martin Docherty-Hughes) for setting the scene, and for expressing his concerns, needs and wishes regarding shipbuilding in his own constituency and across Scotland. These issues are very important for us all—each and every one of us. I declare an interest, as I am a Member of the Defence Committee, as indeed are a significant number of the Members who are here in Westminster Hall today.
It is a pleasure to speak on an issue that is of great interest. Indeed, the Defence Committee is holding an inquiry on naval procurement, including the procurement of the Type 26s, as it really is a matter of great importance.
The hon. Gentleman outlined the importance of the construction of the Type 26 for jobs first of all, but also for the security of the United Kingdom of Great Britain and Northern Ireland. As I always say, and I say again now, we are better together. It is a real pleasure to speak on this issue and to put that marker down as well. I am very fond of my colleagues from the Scottish National party who surround me; I look upon them as friends and it is good to come along and contribute to a debate that interests them, interests me and interests this House.
There is a reason why we are world-renowned for our Navy—it is because we get the best. To get the best, we must put in the best, as well, and ensure that the Navy’s equipment is up to date and, more importantly, up to scratch. The Government plan to spend some £19 billion over the next decade on surface ships for the Royal Navy and the Royal Fleet Auxiliary Service. On page four of the Library briefing for this debate—I commend the background guys for the work that they have done; the information in the briefing is excellent—it says:
“The Strategy is intended to place UK warship shipbuilding on a sustainable longterm footing”.
That was said by a Defence Minister, Earl Howe, in September.
In November 2014, the Minister of State, Department of Health, the hon. Member for Ludlow (Mr Dunne), who was the Minister responsible for defence procurement at the time—by the way, he was an excellent Minister and the meetings we had with him were always very positive and helpful—said that complex warships for the Royal Navy were only built in UK shipyards.
There is also a particular comment in the Library briefing that I love, namely, that we must maintain
“a ‘steady drum-beat’ of orders”,
which the Library briefing says
“is often mentioned by those following the Navy’s acquisition programme.”
Those are some of the comments that I have taken from the Library briefing.
A substantial portion of this planned work will be for the Navy’s new fleet of frigates. The remainder is divided between money that has already been committed to completing the new aircraft carriers, offshore patrol vessels and tanker ships, and maintenance and support for in-service equipment. Clearly, there is a commitment to the British fleet and to the Royal Navy, and we want to make sure that that continues. It is my desire, and it was the desire of the former Minister, the hon. Member for Ludlow, to see the new British fleet built in Britain. As we have said, we are marching to the steady drumbeat of orders, and that must be the way we move.
We are renowned in Northern Ireland for shipbuilding, through Harland and Wolff. Many Members will know that; I am not sure where those who do not know it have been living. I have heard many jokes about the Titanic, and all I have to say is this: it was fine when it left Belfast. Joking aside, we have the ability within the United Kingdom to build our own fleet, and that must be a priority. We must ensure that the Royal Navy’s replacement of the current 13-strong frigate fleet, which will begin to leave service in 2023, is manufactured on our shores. We need that commitment, and I believe that the Minister will give us it—I wait eagerly for her response and I thank her for being here.
It has been nice to hear that shipbuilding is important not only to Scotland but to Northern Ireland, England and Wales. In my constituency, I have David Brown Gear Systems Ltd. The company used to make tractors and owned Aston Martin—the DB9—and it now makes the gears for propulsion systems. I thank the hon. Gentleman for saying that the matter covers all elements of our United Kingdom shipbuilding and, like him, I look forward to hearing from the Minister about the wonderful Type 26.
The hon. Gentleman has a passion for the Royal Navy and the Royal Marines. I know that from his interventions in discussions and from the comments he makes.
I am given to understand that there is a delay with the frigate fleet, but we must not and cannot cut the number of Type 26 frigates and opt for a new, cheaper, general purpose frigate. Will the Minister confirm that we will have the frigate we wish to have and not a cheaper one? I return to my original point—to be the best we must have the best. We have an industry that can and will make the ships to the highest of standards, to keep our Royal Navy in a position where it is effective and ready, and we have an industry that is crying out for the work. Those two needs can and should go hand in hand. As the hon. Member for Colne Valley (Jason McCartney) said, we have a high quality of workmanship across the whole of the United Kingdom.
I would of course wish for Harland and Wolff to have its share of any work that can be carried out. That is natural, having grown up as I did, with men around me going to the shipyard for their day’s work. I can remember as a boy—and that was not yesterday—many people from my constituency going to Harland and Wolff. The manufacturing base we had in Northern Ireland was certainly one of the best. However, what is most important for me is that the ships are built to meet the needs of the Royal Navy and that they are not pared back to suit cost analysing.
I have spoken out often—some may say loudly on occasion—against the paring back of any of our armed forces, and many in this Chamber do likewise. We should be under no illusion: the Royal Navy provides us with a security that is as necessary today as it ever has been. In the armed forces all-party group we go to dinners and hear speeches on behalf of the Royal Navy and we are always impressed by what we see and hear and by the efficient, modern, up-to-scratch Royal Navy that can combat any in the world. As a nation that might not be labelled as “at war” but is certainly instrumental in international peacekeeping, it is essential that we look to our future and ensure that we have a Navy that can defend as well in 20 years’ time as it can now.
I again thank the hon. Member for West Dunbartonshire for raising the issue. Although I understand—I may have got it wrong—that he is putting down the marker for where ships are made, I am putting down the marker to ensure that they are, in fact, made, and to the specifications that are needed. Although we want to keep shipbuilders busy, that is not why the order was placed. It was placed because we need the frigates—it as simple as that. That was determined in 2010 and, if anything, our need for an up-to-date and modern Navy has only intensified since then. Let us keep the shipbuilders in business by ensuring that everything is built on our shores but, more importantly, let us keep our shipbuilders and shores safe by giving the Royal Navy the tools that are needed to do that. The well-known saying, “You get what you pay for”, has merit; we need the best and it needs to be paid for. Let us ensure that the autumn statement reflects that need and the action that must be taken.
I look forward to the Minister’s response, and I hope that she can convince us all and give us the confidence that the Type 26 frigates are the ones that will be here for the future. If that is the case, this will have been a good debate.
It is always a pleasure to serve under your chairmanship, Mr Hollobone. As the Member who has the privilege of representing the Govan shipyards, it is a pleasure to speak in this debate, and I thank my hon. Friend the Member for West Dunbartonshire (Martin Docherty-Hughes) for securing it.
There remain a number of questions to be asked this afternoon, but possibly the simplest one can best be described as: does eight plus five equal 13? That is important, in understanding the history of where we are. As my hon. Friend the Member for West Dunbartonshire highlighted, the history started before the independence referendum, with promises of 13 Type 26 frigates. Last November, at the strategic defence and security review, we were given the assurance: “It’s okay. There won’t be 13 Type 26 frigates; there’ll be eight Type 26 frigates and five light, general purpose ones.” There is nothing to worry about, was the message given to the workforce on the Clyde. I ask that simple question because I know that the workforce on the Clyde and the trade unions are frustrated by and worried about the delays in the timetable for the Type 26. The original date for cutting steel was May 2016; it would be useful if the Minister could give reasons for the delay in the procurement. Despite 15 written questions, I have received no meaningful answers.
The hon. Gentleman may say that, and I may come on to that point, but the Government have never confirmed that that is the reason for the delay, and it would be useful if they were to say that today. If he is correct that there was a lack of money, I am sure that there are Committees and hon. Members in the House who would want to ask what happened with the money.
Lord West suggested to the Defence Committee that the defence budget for shipbuilding was spent. In answer to a question from my hon. Friend the Member for Dunfermline and West Fife (Douglas Chapman), he said:
“Shall I tell you what the problem is? Notwithstanding having said how much extra money there is for defence, in the near years there is not. There is almost no extra money available this year, and we are really strapped next year. The Government aren’t coming clean about that. I think if they did, people would understand.”
In answer to further questions, he outlined that delays can be costly in the long run. In response to the Chair of the Committee, he said:
“Every delay costs you money. These delays all cost money. You need a steady drumbeat of orders to keep high-tech industries going. Our complex surface warship building industry, like the submarine one, needs a steady drumbeat of orders.”
My hon. Friend talks about the drumbeat and the starting point for the project. Is it not one of the key concerns that, even when the project starts, if the drumbeat is extended and the length of time for the completion of each ship is extended, by the nature of that equation, fewer workers will be needed?
That concern is felt not only by my hon. Friends, but by me and, crucially, the trade unions and workforce on the Clyde. What economic impact assessment has been carried out on delaying the Type 26 frigates? We know from an excellent report by the Fraser of Allander Institute, which was commissioned by GMB Scotland, that the two BAE yards at Govan and Scotstoun directly employ a total of 2,723 people. More than 1,000 of them, men and women, are skilled tradespersons. I am delighted that there has been an increase in women apprentices and women workers highly involved in high-tech industry. The report estimates that the two yards in Glasgow support a total of 5,943 jobs and, through that, £162.7 million of wages across Scotland as a whole. Returning to my original “eight plus five” question, will the Minister confirm whether the general purpose frigates will also be built on the Clyde, as confirmed by the former Prime Minister in the strategic defence and security review in November 2015?
We know that a national shipbuilding strategy will be announced soon. I am looking forward to that, when it comes, but I reiterate that we should not underestimate the frustrations of the workforce. They want to build ships. They want a long-term future for the Clyde that will begin with cutting steel for Type 26 frigates. I look forward to the Minister’s response to my questions.
It is a pleasure to serve under your chairmanship, Mr Hollobone. I congratulate my hon. Friend the Member for West Dunbartonshire (Martin Docherty-Hughes) on securing this important debate, and I echo his call for the UK Government to come clean on when work will start on the Type 26 programme. He put forward the compelling case that what we are witnessing has all the hallmarks of another sorry tale of under-investment, neglect and broken promises to workers on the Clyde.
The workers on the Clyde have no better champion than my hon. Friend the Member for Glasgow South West (Chris Stephens), and he was absolutely correct when he pointed out that in the run-up to the 2014 referendum on independence, we were promised that if we remained within the United Kingdom, there would be 13 new Type 26 frigates. That was unequivocal. That was the figure we were told. However, fast-forward barely a year, and in the 2015 SDSR, that figure was reduced to eight, alongside a vague, unwritten promise of five light frigates.
To back up my hon. Friend, I have a leaflet that was put around by the Labour party during the referendum campaign. It states, unequivocally:
“Within the UK Govan and Scotstoun will get the order for 13 Type-26 frigates from the Royal Navy.”
What does he make of that?
Had the hon. Gentleman been in his place at the start of the debate, he would have seen that there was cross-party consensus. We were being very consensual. The Scottish people and the Scottish workforce have been betrayed by the Government. The hon. Gentleman would do well to focus on the Government and their betrayal, rather than attacking people who are defending Scottish workers.
With the old Type 23 frigates being withdrawn from service in 2023, the Type 26 programme had to start in early 2015, but the manufacturing of the eight ships will now not begin until the summer of 2017 at the earliest, with at least one union convener saying that it will not begin until 2018. That is a delay of at least two years, and possibly three. As we have heard, the lesson from all defence procurement deals is that if there are delays, costs will always increase.
What is the reason for the delay? Is it that the Government think that we no longer need Type 26s? That is not the case. As Peter Roberts, a senior research fellow at the Royal United Service Institute, said, the Government are talking about
“a level of Russian submarine activity that we have not seen since the 1980s…That poses a significant threat for the UK”.
If the delay is not on the grounds of national security, and it is not a strategic decision, it can only be based on cost. Perhaps Lord West of Spithead, the former First Sea Lord, was absolutely right when he said that
“there is not enough money in the MOD”
to start construction. He said that before Brexit, and he could say it with bells on now.
Despite the Minister’s protestations that the
“national shipbuilding strategy…is not something that is affected by the outcome of the referendum”,
we all know that if prices are denominated in dollars, costs will soar.
When the Secretary of State for Defence came to the House on 27 June—the first day the House sat after the EU referendum—he said that he was
“not prepared to sign a contract with BAE Systems until I am absolutely persuaded that it is in the best interests of the taxpayer”.—[Official Report, 12 September 2016; Vol. 614, c. 592.]
Are we to assume that that was mere coincidence? The hon. and gallant Member for Beckenham (Bob Stewart) got it absolutely right when he said that the project has been delayed because the Government have run out of money. They have run out of money because they have committed far too much of their procurement budget to Trident. It would be an unforgivable betrayal of the Clyde workers if they were the ones who had to pay not only the price of Brexit, but the price of Trident, which has been ring-fenced within defence procurement. Once again, it appears that the Government are prepared to sacrifice our conventional defence capabilities to their obsession with Trident and nuclear weapons. I look forward to the Minister letting me know about that.
If there is not a lack of will and there is sufficient money, prove us wrong and give us a start date. The workers on the Clyde have had far too many broken promises. An important supply chain is at risk in the defence manufacturing sector. We need confirmation that the five general purpose frigates will also be built on the Clyde. I would appreciate it if the Minister addressed that point in her remarks. The work needs to start now. The workers on the Clyde have been betrayed too often. Will the Minister break that chain of betrayal and let-down? Give us a date for when work on the Type 26 programme will start.
It is a pleasure to serve under your chairmanship, Mr Hollobone. It has been said that confusion and muddle have been the hallmark of the Government’s approach towards naval shipbuilding in recent years. Nowhere is that lack of clarity more in evidence than when it comes to the construction of frigates.
The Navy has 13 Type 23 frigates. As we have heard, there was a strong suggestion in the 2010 strategic defence and security review that 13 Type 26 frigates should be constructed in place of those 13 Type 23 frigates. We were told that manufacturing of those new frigates would begin in 2015-16, but the 2015 SDSR cut the number from 13 to eight. At that time, the Government gave a weak commitment to building at least five new general purpose frigates, possibly more. They have yet to agree a manufacturing date with BAE Systems for the Type 26 frigates, and the demonstration phase on those frigates was extended in March 2016 by a further year. At the same time, BAE Systems has been building three offshore patrol vessels, and the Government plan to have two more of those. That general factual background leads to a number of key questions that have been touched on in the debate, and that I want to underline.
First, with regard to timescale, if the Government do not give the go-ahead and the date for the cutting of steel is not before summer next year, the production trades will have almost finished manufacturing work on those offshore patrol vessel programmes, and will have no work to carry on with. In other words, there will be a hiatus. The trade skills that are required for the construction of the offshore patrol vessels will be lost and will not be able to be deployed other than at significant cost, with more delays and more training. It is important that the Government come clean; they must have some idea of the start date, and I hope that the Minister will tell us when that will be.
The second question is again on the issue of skills and the dovetailing that will be necessary between the Type 26 programme and the programme for the general purpose frigates. The trade unions have pointed out that as the Type 26 programme design phase is decreasing, the ship designers will need another programme to work on, so we need specifics from the Government on the general purpose frigate programme as well. What is the Government’s intention in that regard?
Thirdly, we have already seen delay—hopefully there will not be more—but what does that mean for the existing Type 23 frigates? The Government have said that there is to be no extension of their lifespan. Is that still the case? I have been told that the Type 23 frigates have already exceeded their original design life. If they are kept in service, there are implications for the Navy, in terms of fulfilling the requirements that those frigates meet.
The final question is on cost, and clarity would be desirable here. As we have heard, there have been suggestions that because of the Government’s continuing austerity programme and the hardening of cuts, it is becoming increasingly expensive for them to make real their previous commitments. Admiral Sir Philip Jones, the First Sea Lord and head of the Navy, suggested that when he told MPs on the Select Committee that one problem is the cost of designing quiet ships; the technology is far more expensive than was originally envisaged. That may or may not be the case, but what is very important, on that and on the other issues raised this afternoon, is that we have clarity and certainty from the Government.
Broadly speaking, that is correct. There will certainly be excessive costs if the Type 23 frigates are required to stay in service beyond their natural design life. Also, with most programmes, and certainly with defence procurement programmes, the longer the programmes, the more the delay and the greater the costs. There is also an impact on the workforce, with greater uncertainty and greater job insecurity. On all these issues, what is required is, at the very least, clarity from the Government. I thank the hon. Member for West Dunbartonshire (Martin Docherty-Hughes) very much for bringing forward this issue today.
Let me start by saying what a pleasure it is to serve under your chairmanship this afternoon, Mr Hollobone. I congratulate the hon. Member for West Dunbartonshire (Martin Docherty-Hughes) on securing this debate and for providing me with the opportunity to update the House on this important subject.
The 2015 strategic defence and security review restated this Government’s commitment to the Type 26 global combat ship programme. It was a positive strategic defence and security review for the Royal Navy, committing to an increase in the size of the service for the first time in a generation.
There has been a high level of interest in the programme since we announced our plans and I, along with ministerial colleagues, have consistently confirmed the Government’s continuing commitment to it. Let me once again reiterate that commitment. The Type 26 global combat ships remain critical for the Royal Navy and nothing has changed since last year’s strategic defence and security review. We are going ahead with eight anti-submarine warfare ships and all eight ships will be built at the BAE Systems shipyards on the Clyde.
We have backed up our commitment with significant investment as we continue to progress the Type 26 programme. We announced in March this year the award of a contract with BAE Systems, valued at £472 million, to extend the Type 26 demonstration phase to June 2017, enabling us to continue work with industry to develop an optimised schedule for the programme to reflect the outcome of the strategic defence and security review; to mature further the detailed ship design ahead of the start of manufacture; to invest in shore testing facilities; and to extend our investment in the wider supply chain to cover almost all the equipment for the first three ships.
I did not say that in updating the House there would necessarily be anything new, but I do want to reiterate the commitments that I have previously made.
The work will benefit suppliers across the country, injecting an estimated £200 million into the UK supply chain and sustaining 1,600 high-quality jobs, an estimated 600 of which—more than a third—are in Scotland. From Loanhead in Midlothian, where the helicopter handling equipment will be built, to Fleet in Hampshire, where communications equipment will be developed; from Dunfermline in Fife, where the steering gear will be built, to Huddersfield in West Yorkshire, as mentioned by my hon. Friend the Member for Colne Valley (Jason McCartney), where the gearboxes will be constructed—this investment is good news for UK industry. Furthermore, we announced in July the latest commitment of £183 million to buy the maritime indirect fires system—the five-inch gun—for the first three ships. That takes our total investment in the Type 26 programme so far to £1.8 billion, which is hard evidence not only of our commitment to the programme but of real progress in delivery.
Like the shadow Minister, the hon. Member for Caerphilly (Wayne David), I am guessing that we are not going to get a date for cutting steel this afternoon. Is it the Ministry of Defence’s intention to tell us the expected date for cutting steel on the Clyde before or after the autumn statement?
The hon. Gentleman is going to get a lot of interesting stuff from me this afternoon, so he will have to sit on the edge of his seat as I speak. I will give the hon. Member for West Dunbartonshire three minutes to sum up.
A key focus of this afternoon’s questions has been the timetable for the programme and the building of the ships. The timing of the award of the build contract and the build schedule itself are key components of the ongoing commercial negotiations between the Government and BAE Systems. We are negotiating a deal that aims to optimise the Royal Navy’s requirements, in terms of the capability that the ships will deliver; to achieve value for money for defence and the taxpayer; and to deliver a build schedule that drives performance by industry. Those negotiations are continuing, so I am not in a position to give a specific date for when an agreement will be reached. I am sure hon. Members will appreciate that, to protect the Ministry of Defence’s commercial interests, disclosing any such detail would be inappropriate at this time.
The Government have given assurances to Lockheed Martin and those working on the F-35s in Fort Worth in America right through to the end of 2030, but they are totally unable to do so to the workforce at BAE Systems in Scotstoun and Govan to the end of this decade. Surely there is a mismatch between their commitment to British workers and their commitment to those in America.
With the greatest respect, I do not accept the hon. Gentleman’s statement. We have an incredibly ambitious shipbuilding programme in this country. In Scotland at the moment, we are building the two largest warships that the Royal Navy will ever take delivery of. The hon. Gentleman cannot complain in any way about the ambition of our shipbuilding programme in the Clyde; I do not accept that in any way, shape or form.
I want to touch on the national shipbuilding strategy, which was raised by the hon. Member for Strangford (Jim Shannon) and others. I hope the assiduous Member for Strangford has had a chance to meet with Sir John Parker, who hails from Northern Ireland, as part of his review. He is a leading authority on naval shipbuilding and was appointed independent chair of the shipbuilding strategy. He will make his recommendations by the time of the autumn statement.
The Minister will be aware that Sir Mark Stanhope, the First Sea Lord of the Navy, attended the Defence Committee. He said that if we do not cut the steel soon, some very old frigates will be protecting brand new carriers and the strategic nuclear deterrent, and he warned that the Navy is in danger of not being able to fulfil all the requirements expected of it. The date is so important—can the Minister give it to us?
In answers to the House, we have disclosed the out-of-service dates for the existing Type 23 frigates. They are a matter of public record. Clearly, the acquisition of the Type 26 global combat ship will be crucial to the future of the UK’s shipbuilding industry, and will form part of the national shipbuilding strategy. The Type 26 global combat ship will form a key component of the future maritime force, but last year’s strategic defence and security review also considered more widely how it will replace our current in-service frigates.
Hon. Members will be aware that there are currently 13 Type 23 frigates in service with the Royal Navy. The eight Type 26 global combat ships will be built to replace the current eight anti-submarine warfare Type 23 frigates on a one-for-one basis. The capability currently provided by the five general-purpose Type 23 frigates will be met by a new class of light, general-purpose frigate that will, by the 2030s, enable us to increase the overall number of frigates. The programme to take that commitment forward is in its pre-concept phase and is a key part of the national shipbuilding strategy. I look forward to receiving Sir John Parker’s recommendations on taking the programme forward soon.
I have given the hon. Gentleman a range of dates for some of the commitments we have already made and some of the contracts we have already placed as a result of this programme, which sustain jobs across the UK.
The need to ensure we have the skills required to deliver Type 26 also came up in the debate. That is an essential factor in the successful delivery of the programme and is crucial to our strategic aim of placing UK shipbuilding on a sustainable long-term footing.
In the interests of time, I will quickly skip through the issue of offshore patrol vessels. We are looking forward to the delivery of HMS Forth—a ship of that class—next year, and HMS Medway and HMS Trent remain on track.
It is important to put the Type 26 programme in its wider context. Overall, last year’s SDSR achieved a positive and balanced outcome. We are growing the defence budget in real terms for the first time in six years and delivering on our commitment to spend at least 2% of GDP on defence. The SDSR enables us to invest £178 billion in new equipment for our armed forces over the next decade, an increase of £12 billion on previous plans. In the maritime sector, we have set the trajectory for expansion of the Royal Navy’s frigate fleet as we spend about £8 billion on Royal Navy surface warships over the next decade.
As I have explained, we continue to progress the Type 26 global combat ship programme. Hon. Members with constituents who work at the shipyards on the Clyde rightly emphasised the importance of the Type 26 global combat ship programme to the workforce. In response to concerns expressed on their behalf, the Ministry of Defence has consistently restated its commitment to the programme and confirmed that all eight ships will be built on the Clyde. There should be no lingering doubt on that point or on the idea that Royal Navy vessels would be built on the Clyde had Scotland voted to leave the United Kingdom.