Tuesday 24 November 2020
[Esther McVey in the Chair]
Charity-funded Medical Research
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I beg to move,
That this House has considered recognising and preserving the value of charity-funded medical research in the 2020 Spending Review.
It is a pleasure to serve under your chairship, Miss McVey. I should like to record my thanks to the Backbench Business Committee and the Chairman of Ways and Means for granting time for this important debate before tomorrow’s spending review. I also thank the British Heart Foundation for its assistance with preparations for this debate.
The UK Government website states that
“our world-class research and researchers play a vital role in delivering local and national economic prosperity but we recognise that some of that research is at risk from a range of income losses as a result of Covid-19.”
I agree wholeheartedly with that statement and emphasise that we acknowledge the extremely valuable scientific and medical contributions that they make.
As I hope to set out, charity-funded medical research has lost a great deal as a result of covid-19. If its contribution to the UK and, indeed, to the world is to continue, the Government must consider further support, particularly ahead of tomorrow’s spending review.
Life sciences research and development is funded through a broad partnership between Government, universities, the private sector and charities. In 2019, charities funded £1.9 billion in UK research and development. This year, medical charities have seen the closure of their charity shops, the cancellation of fundraising events and a drop in public donations.
The true value of charity-funded medical research is often under-appreciated, and to understand the gravity of the situation in which the sector finds itself we must first acknowledge the contributions it has made to society in a normal year. A 2017 report published by the Association of Medical Research Charities found that 397 unique medical products and interventions were produced further to charitable awards, most of which were drugs and diagnostic tools but the list includes a gas delivery ventilator system to help to protect long-term brain function in babies starved of oxygen at birth and new immunotherapies for cancer. These are practical benefits of research that save lives immediately, but in the medium to long term the development and sharing of knowledge is key.
Medical research charities have produced hundreds of models and more than 26,000 unique publications that go on to inform research for years to come. The production of such publications is not straightforward or free: it is largely unseen work that is essential to developing practical solutions to healthcare challenges. This knowledge, which has improved our understanding of diseases such as Alzheimer’s dementia, has also been used to inform policy making.
Throughout this pandemic the Government have outlined that their policy decisions have been guided by the science. I fully support that approach and I know that it extends to all medical and healthcare policies. The Association of Medical Research Charities reports that in 2017 there were 166 citations in policy documents which referred to research linked to medical research charities and 536 examples of researchers directly providing advice to Government. From clinical reviews to participation in advisory committees, the combined knowledge of medical research charities and their staff has critical value.
It is important to note that practical healthcare solutions and knowledge development are not exclusive to the research of major diseases. Thousands of people in the UK live with rare diseases and in 2018 alone medical research charities invested £142 million in 640 rare disease projects. Without ongoing research conducted by well-funded specialists, we risk declining health outcomes for many who suffer from all conditions, but particularly those that are less common.
Further to the expansive scientific and practical value of charity-funded medical research, there is a significant economic element. Last year, in Wales alone, 53 charities funded 289 active grants worth £89.7 million benefiting research institutions such as universities and NHS organisations. More than one third of charities associated with the AMRC projects that are being carried out are in Wales. At pre-pandemic levels, more than 17,000 highly skilled jobs were supported directly in the sector throughout the UK. It is thanks to the tireless work of these experts and their support teams that, for every £1 spent on research by public and charitable funders, there is a return of 25p per year in perpetuity. The financial value of the charitable sector is perfectly demonstrated by the British Heart Foundation, which made an investment of £476 million last year, leading to researchers leveraging £1.27 billion.
Unfortunately, as has been seen across the board, covid-19 has been catastrophic for medical research, posing immediate challenges as well as medium and long-term charity-funded uncertainties. The AMRC estimates that such charities lost 38% of their fundraising income between March and May 2020, leading to an immediate shortfall of £310 million this year. Predictions go on to warn of a 41% fall in research spend in this financial year, and reports from the Institute for Public Policy Research expect a shortfall of up to £7.8 billion in UK research and development spending between now and 2027. The British Heart Foundation alone lost £10 million in revenue during each month of the spring lockdown, and current restrictions will cost another £7 million. Because of this, the organisation has already halved its research budget for next year—a reduction of £50 million. Likewise, Cancer Research UK has been forced to cut £44 million from its research spending. Unfortunately, this approach has been necessary among many other charities, too. The current trajectory shows that it will be at least half a decade until we return to pre-pandemic levels and without a change there will be significant implications for jobs and health outcomes.
I know that many charities are grateful for the support that they have received from the UK Government through schemes such as the coronavirus job retention scheme, which has been extended to March next year, but with the overall reduction in income and consequently fewer research projects, many of those positions may not be sustainable. A survey of more than 500 charity-funded early career researchers in the UK found that four in 10 are considering leaving research due to funding concerns arising from the covid-19 pandemic. In total, half of researchers say that their funding will expire by the end of 2021. Of those, two thirds have been unable to secure funding to take them to the next stage in their careers. Cancer Research UK worries that, without support, it could be forced to lose 1,500 researchers—more than one third of its research workforce. It is worth putting on record that such jobs are highly skilled positions that require extensive research infrastructure and if we lose them, they may never return. Muscular Dystrophy UK notes that it funds new PhD students at each grant round, so without financial support not only are we damaging the industry now but there will be worrying implications for British research.
Medical research charities have, sadly, been unable to access the £750 million of additional funding made available in April to support charities providing essential services. This is despite many charities pivoting their research to support the national covid-19 effort, including Cancer Research UK labs providing testing kits and Asthma UK providing an essential post-covid hub and helpline for people left with breathing difficulties.
The number of patients entering Welsh research studies fell by 23.8% between 2018-19 and 2019-20. At the UK level, at the height of the first lockdown, the AMRC reports that 73% of clinical studies and trials funded by charities were paused or delayed. This number remained at 43% even in September. The expectation of some in the industry is that, unfortunately, some of these trials will never restart. We must do all that we can to reverse this trend.
So what action is required? It is vital that we fund research to better prevent, diagnose and treat illnesses, a view shared by my constituent Mandy Swift who sustained two heart attacks in her early 50s and spoke out recently about the need for women to better understand their risk of a heart attack and its symptoms. Preserving charity-funded medical research needs to be a priority for the Government. We now stand at a crossroads and decisions taken in the days and weeks ahead can influence the future of charity-funded medical research for the next decade. As we reach the end of the transition period and want to retain our status as a global leader in this sector, we must provide the support that is necessary.
The Government have already pledged money through the sustaining university research expertise—SURE—package. I am delighted that, by introducing this programme, the Government have publicly acknowledged the value of our unique research and development ecosystem. However, it is unclear how charities will be able to engage with this funding. The spending review and the Chancellor’s statement tomorrow is an ideal opportunity to bring forward the further support that is much needed. I know that the charity-funded medical research sector is one of the many sectors calling for a bespoke package of support and, indeed, I am sympathetic to calls from many other industries. However, the unique contribution of medical research to our health, wellbeing and economy is unmatched. Charities fund research in every region of the UK, contributing to regional growth and the Government’s levelling-up agenda. Ultimately, this research also leads to health improvements, particularly in areas of unmet health need and inequality.
Organisations, including the AMRC, the Royal College of Physicians, the British Heart Foundation, Cancer Research UK, Muscular Dystrophy UK and the Francis Crick Institute, have all been in touch with me in the run-up to this debate calling for a life sciences charity partnership fund. This proposal centres on the three-year settlement to provide a match-funding arrangement that would contribute £310 million in year one to protect and enhance our status as a science superpower. The parameters of such a scheme could be settled upon by the Treasury in consultation with the sector. The Royal College of Physicians specifically notes that funding should be targeted to support more research activity in rural areas, such as north Wales, that often carry the highest disease burden but the lowest research activity. Some 40% of those working in rural hospitals would like to be more involved in research, and that figure is 12% higher than for reported respondents in city hospitals.
The Royal College of Physicians has proposed that, in areas where research activity is low, a trial should be programmed whereby 20% of consultants have 20% of their time protected for research. Such potential approaches are important. As the AMRC points out, during the pandemic its members in Greater London have been twice as likely to have secured funding than those outside the capital, leading to a risk that a charity funding crisis may exacerbate regional divides. Without much-needed support, more than 50% of the AMRC’s members have indicated that the impact of covid-19 on their research portfolio will have implications for the UK’s ability to attract research talent and global research leadership.
As the Government publicly acknowledge, we have a world-class research system and researchers too but, as a result of covid-19, thousands of scientists and projects are at risk. That concerns me greatly as a GP. Charity-funded medical research has been an intrinsic part of our national R&D ecosystem for decades, contributing to major scientific breakthroughs, the advancement of knowledge and economic growth. Without action soon, we risk years of poor research outcomes and thousands of highly skilled jobs being lost. Although some support has thankfully been made available, I believe that the spending review provides the Government with the perfect opportunity to extend that, ideally through a life sciences charity fund. I hope that such a plan is already in the Chancellor’s mind. If not, I ask the Minister to make him aware of today’s debate.
As the UK Dementia Research Institute notes, charity-supported medical research has been prominent in national efforts to tackle the outbreak. As attention turns to long-term impacts, we must ensure that medical research is supported now and into the future.
It is a pleasure to serve with you in the Chair, Ms McVey. I congratulate the hon. Members for Vale of Clwyd (Dr Davies) and for Bolton West (Chris Green) on securing this important debate.
Most of us will have put dignity to one side and “worn it pink” for Breast Cancer Now, piling on feather boas, hats and Elton John-style pink specs. It is a bit of fun, but it has a serious point. More than 150 MPs took part in 2019, and the charities Breast Cancer Care and Breast Cancer Now say that the Wear it Pink campaign has raised over £33 million in the last 17 years to fund breast cancer research and support. It is just one of the many activities helping charities to raise essential funds to support the cancer research that is so desperately needed, and it is helping to improve cancer survival rates.
This year is different, though. Understandably, covid-19 has meant that Wear it Pink and so many other events cannot take place. Although we might wear pink at home, it is not quite the same. Of course, such parliamentary events are just the tip of the iceberg in raising funds. Our charities have been hard-hit by the effects of covid-19. Their fundraising activities right across the sector have been hugely hit by the restrictions on holding events. Charity retail shops have had to close, resulting in a huge loss of income. It has made it more difficult for them to meet and engage with people, and to raise the money on which they rely to carry out their activities and to fund the research that makes such a positive difference to our knowledge of, and treatment for, the conditions that they work on.
I mentioned Breast Cancer Now. Most of us have been affected by breast cancer at some time in our life. In my case, no fewer than four of my aunties have been treated for breast cancer—thankfully, all successfully. It was only two weeks ago that we heard in the main Chamber from the hon. Member for Chatham and Aylesford (Tracey Crouch), who is undergoing treatment for breast cancer. Breast Cancer Now, which has provided a very helpful brief for the debate, has pointed out that 55,000 women and 370 men are diagnosed with breast cancer each year, that one in seven women in the UK will develop breast cancer, and that 35,000 people are living with incurable secondary breast cancer. It remains the case that almost 1,000 women die from breast cancer each month in the UK, with 600,000 living with or beyond breast cancer.
Covid-19 has had a severe impact on clinical trials. Breast Cancer Now points out that recruitment to many clinical trials was paused, and that the virus stopped new and ongoing trials, as healthcare professionals were asked to prioritise frontline care. I hope the Minister can say what the Government will be doing to improve the rate at which clinical trials will be restarting recruitment.
Members of the Association of Medical Research Charities have together invested £14 billion in research since 2008, with £1.9 billion spent on UK research and development in 2019 alone. That is more than was spent by the Medical Research Council and the National Institute for Health Research. It is half of publicly funded medical research nationally, and 66% of total research spend on cancer. Members of the Association of Medical Research are planning for an average 41% decrease in research spend in 2020-21. Many other charities are also facing difficult problems. The hon. Member for Vale of Clwyd (Dr Davies) mentioned the British Heart Foundation; many of my constituents have been in touch to talk about the importance of ensuring that its research continues.
I want to look briefly at two charities at opposite ends of the scale. Muscular Dystrophy UK supports people with neuromuscular conditions and the research that produces new treatments for those conditions, dealing with quite a small group of people as a percentage of the population. The charity points out that covid-19 has produced a shortfall of £310 million in charity research investment, and that although the Government have provided £750 million of support to charities, none of that was for charity research. Muscular Dystrophy UK estimates that it will take over four years for its charity research fund to recover, but a decade to rebuild what would be lost in terms of capacity and capability.
Muscular Dystrophy UK’s research relates to rare or ultra-rare conditions, supporting research, infrastructure and capability, and sustaining a diversity of funding approaches, including those that are high-profile and high-risk. It involves people with lived experiences of neuromuscular conditions to set research priorities through its lay research panel and its medical research committee. It has also supported research into gene therapy for Duchenne muscular dystrophy, cell-based screening for myotonic dystrophy and exome sequencing—all projects that have produced important outcomes, have led to further potential treatments that will make such a difference to those with neuromuscular life-limiting conditions. So those are really important issues, and the pandemic is limiting what can be done.
At the other end of the scale of numbers is Alzheimer’s Research UK. It works on behalf of a much wider group of people, who live with the impact of Alzheimer’s and dementia, sadly, another condition that most of us will be touched by in the course of our life—either in people we know or ourselves. Alzheimer’s UK points out that covid-19 is not the only health crisis that the UK is facing, and says that dementia is the only condition, of the top 10 leading causes of death in the UK, for which there is no treatment to prevent, cure or slow its progression; and that it is predicted that 1 million people will have dementia by 2025. There is an urgent need for medical research into Alzheimer’s, and that is largely funded by medical research charities such as Alzheimer’s Research UK.
Covid-19 has hit people with dementia hard. A quarter of people who have died from covid-19 also had dementia. Research is urgently needed, but it is facing delay due to the pandemic. Funding opportunities have been reduced and social distancing has slowed the pace at which researchers can work. We know, too, that dementia has a huge impact on too many people. It is vital that we support research into the causes of dementia urgently, even in these difficult times.
The medical research charities have come together to propose a way to ensure that that vital research for both rare and widespread conditions can continue. They point out that the current Government support for charities and Sustaining University Research Expertise—the SURE fund—is not a long-term solution, so they are calling for the Government to create a life sciences charity partnership fund over the next three years, starting with £310 million in year one, to meet that shortfall.
Our medical research charities play a huge part in developing future treatments for so many conditions. If we are to maintain that progress in cancer research, rare conditions, dementia and so many other things, the Government must help, so I ask the Government to commit, in tomorrow’s statement, to supporting that vital work.
It is a pleasure to follow my hon. Friend the Member for Vale of Clwyd (Dr Davies) and the hon. Member for Blaydon (Liz Twist)—a couple of excellent speeches, capturing the key features of what we need to be thinking about in this debate, and what the Government ought to be redoubling their efforts to focus on. We only have a day before the spending review, so hopefully the Minister will be busy after the debate, pressing the case for that vital funding.
This debate on the importance of recognising and preserving the unique value of charity-funded medical research in the upcoming comprehensive spending review is incredibly timely and incredibly important. It represents an area that has not received much attention to date; covid and its associated lockdown have had an impact on so many other aspects of our society that this area has barely been looked at. However, the consequences of the impact on the sector are profound and will be realised over many years to come, not only in terms of what it does, what it achieves and the advances it creates, but also the people working in that sector and the treatments and medicines that come from it.
We should be cautious when the Government approach anything that has unforeseen consequences. They are pulling on strings, and we quickly realise how much is unravelling. We have seen other areas of society that are facing great difficulties get funding or other support. As the thread unravels further, we are coming to the charitable medical research sector.
We initially thought the national lockdown would be for three weeks, beginning in March. It seems that round every twist and turn of the road we see yet another deadline, yet another target being drawn out; the next target was expected to be November, and it has been pushed back to Easter. We will soon, after a fashion, be celebrating our first anniversary of national lockdown in one form or another, and the impact over that one-year period is profound.
We know that the direct impact, in terms of health, has already been about 5 million fewer hospital appointments, tens of millions fewer GP appointments and millions fewer cancer screenings. We know the impact on mental health as well. That is more cause for the charitable sector in medical research to redouble its efforts in terms of work and to gain the support it needs from the Government.
We have a sense of the economic impact, which is counted in the hundreds of billions of pounds. That is extraordinary—incomprehensible; but more locally it is affecting our high streets, of which charity shops are a key part. Many research charities gain a very significant amount of their income from high-street charity shops, as do many other charities, such as the hospice movement. So much of that income has been taken away.
We also see the terrible impact on education. Schoolchildren have lost about six months of the school experience. Many schools have done a great deal of good work to ensure that loss is not too great, but many others have not been able to do so. We know that those children have lost out significantly, and some children in my constituency—and I am sure those of other hon. Members—have already missed a couple of weeks, or perhaps two sets of missed weeks, of school when classes, or even year groups, have been sent home because of covid. Therefore many students have lost four weeks of education, and by Christmas it might be six weeks. This is going to carry on until Easter.
The impact on the university sector is enormous, disrupting education. Where will those children and young adults end up? Hopefully, many of them will end up as technicians, engineers or researchers in the charitable medical research sector. Their loss of education, of experience, will have an impact on that sector in the future, and it will have an impact on their ability to get those jobs—those skilled, brilliant jobs. Their ability to get such jobs will be hindered partly because the jobs will not exist if this situation continues, but also because they may not get the experience or qualifications they need.
We can see how this reverberates through our society. Yesterday, the hon. Member for Newcastle upon Tyne North (Catherine McKinnell) led a debate on the closure of sport and gyms, and the impact that their absence will have on health. In normal times, if we are told to jog on, or take a hike, that is seen as quite negative—at least, it always has been when I have heard it. However, for the medical research charity sector, jogging on and taking a hike—or doing sponsored walks or marathons—are a major source of income. That has gone. The London marathon this year was for élite athletes, and the Bolton marathon, which was to have been run for the first time in many years, was cancelled. Those opportunities—the core ways in which the charitable sector receives much of its income—have been taken away. Who would have thought that that would happen, when we were deciding in March to go down the route we did? I dare say none of us had any anticipation of where things would end up today.
It is important to understand the scale of the sector, which is enormous. For example, in 2018 the Association of Medical Research Charities invested £142 million into 640 rare disease projects. That is investment on a colossal scale. Probably tens of thousands of people overall are involved in clinical trials—particularly in the charitable medical research sector—so there is an impact on recruitment for clinical research, and although 3,203 or 49% of commercial and non-commercial studies are open to recruitment, only 26 have recruited a participant since 1 June. That is a huge loss of recruitment to clinical trials.
What does that mean? We have to think of the meaning and impact of those significant figures. It is about a treatment, in one form or another, that could and should be given to people for a clinical trial period. It might not be effective, but it might well be. A trial would give people hope of receiving treatment and support. That is particularly important in relation to rare diseases, where people often feel neglected because there is not the focus on those diseases that there is on higher-profile disease conditions. Medical trials give people hope that treatment for rare diseases is being focused on and supported and that, although it may take years, a treatment will arrive at some point. However, there is an impact on people and their families when clinical trials are closed down and that hope is taken away.
As the lockdown caused by covid rolls on, the period for restarting a clinical trial is pushed further and further back. That is not just because of the duration of the lockdown and difficulty in recruiting people to the trials, but because of funding. If there is no funding, the organisations cannot even start the process of clinical trials. The British Heart Foundation is funding more than 1,700 research staff, working on more than 800 research projects, and it also funds 440 early-career researchers. That is a huge number of people in the sector. The Francis Crick Institute in London has 1,500 scientists, students and support staff working across a variety of disciplines, and looking at illnesses such as cancer, heart disease, stroke, infections and neurodegenerative diseases.
Large organisations are often more resilient because they have better funding streams. Smaller organisations, perhaps more often looking at rare diseases, have less funding for what they are doing, so they are far less resilient. All of this, coming together, gives a clear and powerful reason why the Chancellor, the Minister and others need to act to ensure that this focus—this funding—is there on a sector of our society that is often neglected and not thought about but that, when our friends and our families are hit, is so highly valued and so highly prized.
I urge the Minister to ensure that life-saving medical research can continue throughout and beyond the pandemic lockdown. Government must establish a life sciences charity partnership fund commencing with a commitment in the spending review to an initial £310 million for 2021-22. That may have to continue into following years. It is estimated that, to recover, if Easter sees the end of the lockdown period, the challenge for the sector may carry on for another four years or more. The funding has to follow the sector for at least that period of time.
In conclusion, if we are—I do not like the phrase—to build back better and ensure value for money and the effectiveness of research, we must recognise that the north of England, and particularly Manchester and its surrounding areas, has great expertise in this area. When we are looking at value for money and cost-effectiveness, the golden triangle is magnificent in so many ways. However, when looking at investing in the future, the medical research sector and Government should be thinking about Manchester central, the city of Manchester and the wider area. I hope the hon. Member for Manchester Central (Lucy Powell) will press the Minister on that point as well.
It is a pleasure to speak in this debate with you in the Chair, Ms McVey. This is a timely debate ahead of tomorrow’s spending review. As the chair of the all-party parliamentary group for eating disorders, I will focus my short remarks today on eating disorders and research funding.
We have already heard that covid-19 has had a devastating effect on the charity sector more generally, with income from fundraising lost during lockdown. The value of the expertise of medical research charities has never been more stark, yet they were not included in the Government’s £750 million support package. The charities are a huge driver of medical research in the UK, and we have already heard some of the numbers, but they are worth repeating. Members of the Association of Medical Research Charities invested £1.9 billion in 2019 alone. That is 51% of publicly funded UK medical research. They face a shortfall of up to £7.8 billion between now and 2027, according to the Institute for Public Policy Research.
I want to draw some attention to the importance of charity-funded medical research to understanding and treating eating disorders. The impact of an eating disorder can be devastating, and there is a pressing need for more research. We have heard particularly about specialist and rare diseases, but eating disorders are widespread and have epidemic proportions in many ways. Eating disorders are especially prevalent among young women, affecting about 15% of that age group, but the truth is that eating disorders do not discriminate. That is an important factor. According to the charity Beat, up to 5% of the population will experience an eating disorder.
Eating disorders are all-consuming. They have an impact on social relationships, quality of life and physical health. Anorexia nervosa is one of the most common forms of eating disorders and has the highest mortality rate of any mental health condition. According to the Medical Research Foundation, up to half of people with an eating disorder have self-harmed. Despite all of that, there is still limited research focusing on the causes of eating disorders. There is a serious lack of investment for mental health research in general. In a study last year, the charity MQ: Transforming Mental Health found that eating disorders were among the mental health conditions that received the least research funding.
In recent years, medical research charities, including several members of the Association of Medical Research Charities, have played a hugely welcome role in funding and supporting eating disorder research. Often, the chances for early interventions for eating disorders are missed, and treatments may not always be effective, so many patients are admitted for expensive hospital treatments. Currently, less than half of individuals with an eating disorder reach full recovery. Again, that is an important statistic: half never reach full recovery. That means a large proportion of people in this country are affected by eating disorders.
Studies funded through medical research charities have included research into self-harm and eating disorders, as well as the treatment of adults with anorexia and autism. In February, the largest ever study of eating disorders, the Eating Disorder Genetics Initiative, was launched. This seeks to build on existing research, which shows that genetic factors are involved in eating disorders.
In conclusion, eating disorders are serious conditions and can be potentially life-threatening. These studies help us to understand more, about not just the treatment of eating disorders but the underlying causes and common risk factors; they may even prevent eating disorders from developing in the first place. It is crucial that these charities receive the financial support they need, so that they can continue to play this vital role.
I, too, add my voice to the many here today. Medical research funding is so important, and it needs support from the Government. I urge the Minister to make her voice heard in the spending review tomorrow.
It is pleasure to serve under you, Ms McVey. I congratulate the hon. Member for Vale of Clwyd (Dr Davies) on securing today’s timely debate and the Backbench Business Committee on granting such a debate.
“A statistic will never truly capture the devastating impact research cuts will have on all of us. Research is hope. Research is more time with your loved ones. Research is improved quality of life. Its value is immeasurable.”
Those are not my words, but those of Aisling Burnand, the chief executive of the Association of Medical Research Charities. We have heard much today about the investment the AMRC has put into lives of so many of our constituents. Some 151 charities, which have joined together with the public through their fundraising efforts, have spent £14 billion over the last decade in funding 17,000 research staff and driving 213 clinical trials, advancing the frontiers of medicine and enhancing lives as they go. As we have heard in today’s debate, they also bring resources back Not only does every £1 invested bring 25p back into the economy on a permanent basis, but charities save our NHS so much money through their early interventions and by advancing the frontiers of medicine.
However, covid-19 has disrupted the incredible story of how charities play a central role in advancing science and the UK’s global excellence in this field. That partnership really makes its mark in advances in medicine.
The hon. Lady is making some excellent points. Does she share the view that there is immense collaboration with the private sector, universities and research institutes, as well as the charity sector, and that that ecosystem, which is so often talked about, is key to our position in the world and our contribution to the world?
I thank the hon. Gentleman for that intervention. The interdependence of the various sectors in coming together really puts the UK in a unique position in the way it advances so much medicine. Over recent months, in response to covid-19, we have also seen the incredible work of all the sectors, which have come together to try to beat this virus. Charities play that crucial role, and they are playing it today as they try to support individuals through this difficult time.
We know that a £310 million shortfall in funding will have significant consequences. Cuts always do. As we heard, it will take about four and a half years to recover from the downturn. Tragically, that will all be too late for some. This year alone, it is predicted that we will see a 41% decline in research spending. Many PhDs, fellowships and other opportunities will be denied, cutting vital skills in medical research. If postgraduate researchers do not have the opportunity to apply their skills and knowledge, we will be at risk of losing a generation of medical research. That is why significant investment is needed to save the sector.
With 34% of staff furloughed, clinical trials have been paused and delayed to protect research in the longer term. Without additional funding, there is little hope that those trials will restart. That means that families, such as that of a constituent who came to me, will never see the opportunity to extend their lives and to have a quality life for longer.
The sector is rightly calling for a life science charity partnership fund to fund the research part of its work. That would be built on a match funding principle and would start with a three-year programme of investment into research. The Medical Research Council is seeking a commitment of £310 million in its first year to match the funding it has lost this year due to the lack of funding resource. Not only will that research-driven approach help with economic recovery in the wider field and reduce unemployment, but it help us to continue to lead advances in medicine.
Like all charities, medical research charities have not been served well during this crisis. In fact, that has been a major oversight on the part of the Government. Medical research charities provide not just research but crucial support to their beneficiaries. Over the last six months, I have met many research charities, which have told me about the work they are undertaking, and that work has expanded during the pandemic.
Many organisations provide support services to the people and families who depend on them. The NHS is less accessible, so people have turned to the charities they know and trust for additional advice and support. Regular therapeutic interventions have often not been available on the NHS because of its focus on covid-19—we all understand that—and appointments have been cancelled. People have turned to the charities they know and the relationships they have to seek advice on issues such as where to get food, shielding, what protections they have for their health, and how to support relatives and family members at such a delicate time.
Other organisations, which would normally provide psychological support or respite support or perhaps fund parents to stay near their child as they receive treatment, have also been under great strain. Many of these organisations have described demand for their helpline more than doubling as people turn to them for support. However, they have not received additional support from the Government in response to covid.
Yes, the Government did provide £750 million to all charities, although we must remember that 168,000 charities have had to share that money. However, I must stress that that money was for additional support directly relating to covid-19. Of that money, £2 million went straight to the hospice movement, and rightly so, although that money is now spent, and more is needed. The rest is being divided between the larger charities, and there is a pot for smaller organisations. However, the majority of charities have not received anything over this time, and we have heard today that medical research charities certainly have not had their share.
This was all a direct response to covid, and we have seen more demands being placed on charities, as I have set out. That has also meant that more investment is needed by those organisations. Charities themselves may have direct funding for funded spend, but they are really struggling with their core costs. If their core costs are not met, the charities cannot deliver the specific outcomes we all know so much about from our constituents. It is vital, therefore, that the Government step up tomorrow with a package to address those core costs. Charities have already lost £10 billion in the last six months, and they predict they will lose 60,000 staff. Some 20% of charities will not be there if the Government do not make that investment. They say they value charities, but charities need valuing with resources, and without those resources, they will not continue.
We know that fundraising opportunities have all but dried up. We know that retail, which has been successful since its return, has now been locked down yet again, and therefore the income of organisations is in a perilous situation. That is why the Government need to step up at this point. Many charities did not qualify for the grants that were available, and of course have struggled and still have bills to pay. As the charity sector says itself, rightly and proudly, it has never been more needed, but I would add that it has never been more in need. That is why it is vital that, after today’s debate, the Minister goes back to the Treasury one more time to make the case for research charities and all charities, to make sure they have the research support, funding and investment they need.
Charities are not an optional extra. We know that because, as we have heard during today’s debate, the outcomes they deliver—in not only research but care support and civil society—transform people’s lives. Some 7 million people every year generously donate to medical research charities, often as the result of personal experience or the loss of a loved one. The paucity of the response compared with the public contribution needs to be addressed. Charities stretch their pound further than any other sector, and they provide the highest standards in research and care. They are essential, yet in just a few months’ time, they may no longer be there. We need a robust response from the Minister today, and we need a financial response from the Chancellor tomorrow.
Thank you for chairing this debate, Ms McVey; it is a pleasure to speak in it. I thank the hon. Member for Vale of Clwyd (Dr Davies) for securing it and for his lucid and compelling presentation of his arguments.
For most of my career in the NHS, I was involved in the delivery and management of clinical trials, from surgical interventions, radiotherapy and chemotherapy to nursing and allied health professional research. This activity was conducted in the pursuit of improving cancer treatment and outcomes, but clinical trials are also essential in developing effective treatments for multiple sclerosis, myalgic encephalomyelitis, Alzheimer’s disease, arthritis, Parkinson’s disease, heart and lung disease, and many others. While we may all hope that we will not rely on this research at some point in the future, the progress that is so regularly made reassures us that we are often at the vanguard of effective treatments and care.
However, clinical trials do not appear out of thin air. They are underpinned by groundbreaking scientific discoveries that must translate from bench to bedside, where research initiated in the laboratory is safely developed for clinical use to provide direct benefits to patients. Such translational research evolves from basic experiments in the laboratory—at the bench—to pre-clinical research, before commencing study design, protocol development, and then starting the process of phased clinical trials.
I intend to focus my remarks on childhood cancer, but before I do, it is really important to me—I pay tribute to the words that have already been said on this topic—to mention other vital charities that have made enormous advances in care, but that have yet to receive any meaningful support during the pandemic. The worthiness of these charities—CLIC Sargent, Teenage Cancer Trust and of course Macmillan Cancer Support, to name but a few—is beyond question. Their specialised support is a lifeline to so many. Many other disease-specific charities are in a similar boat, so we must not forget them either.
Every single day across these islands, 12 families get the heartbreaking news that their child has cancer. Although I have participated in the breaking of such distressing news more times than I care to recall, as a parent I still cannot imagine how such news must feel. Despite the fact that much of my clinical and academic work focused on teenage cancer care, I still find the statistics shocking. About 4,500 children and young people are diagnosed with cancer each year, and although significant progress has been made in recent years in developing treatments—for leukaemia, for example—due to the often rare nature of cancer diagnoses at that age, it is still the most common cause of death in under-15s across the UK.
Covid-19 is having an unimaginable impact on charity fundraising—the lifeblood of the research process—and is putting vital treatment developments at risk. Medical research, development and innovation are an integral and vital part of the NHS and Scotland’s health strategy. Charities’ funding has been hit hard during the pandemic at a time when many of the causes they exist to support have come under additional pressures. It is therefore incumbent on the UK Government to ensure that the comprehensive spending review is not wasted on warfare but rewards the life sciences, which have been the only effective weapon in our armoury against covid. That must include supporting charity-funded medical research.
I recently spoke to Mark Brider, chief executive officer of Children with Cancer UK, an organisation that has raised more than £250 million since its creation in 1987 to support families and improve childhood cancer survival rates. The groundbreaking research it funds has led to the development of kinder, more effective treatments with fewer debilitating toxic effects. Childhood cancer survival rates for some cancers have subsequently increased from 64% in 1990 to 84% in 2017.
Children with Cancer UK has warned that it faces an income loss of about 40% as a result of the covid pandemic. It warns that, without additional support, much of its planned medical research will be cancelled, setting cancer research back by many years. It is not alone. A study this year revealed that charities in the UK are facing a £10 billion shortfall, and that as many as 10% face bankruptcy.
Members of the Association of Medical Research Charities are calling on the Government to commit to a life sciences charity partnership fund—a co-investment scheme that would provide a level of match funding from the Government for future research. AMRC charities play a vital and unique role in the UK’s research sector, funding 17,000 researchers’ salaries across universities, the NHS and other bodies. They invested £1.9 billion in medical research in the UK last year.
The covid-19 pandemic had an immediate impact of those charities, with a reported 38% loss in fundraising income, 34% of staff furloughed and 18% of spend on research in universities cut or cancelled as a result of the initial lockdown period. The long-term impact of covid-19 on AMRC charities looks to be just as devastating, with an estimated £310 million shortfall in UK medical research spend. It will take four and a half years to recover to pre-pandemic levels. Medical research charities did not benefit from the Government’s earlier package of support for charities, as medical research was considered outwith the remit of funding frontline services. It is vital that support for their work is included in the comprehensive spending review.
Charities have predicted that the shortfall could have a range of impacts, from preventing them from funding clinical trials and studies, to causing them to defer upcoming grant rounds and withdraw future funding. The British Heart Foundation has already announced that it has cut spending on new research awards by half this year, from £100 million to £50 million. Cancer Research UK has also reported cuts of £44 million in its research funding, and it says that 40% of charity-funded early-career scientists are considering leaving research as a result of funding concerns caused by covid. Without that support, CRUK could be forced to lose 1,500 researchers—more than a third of its research workforce. Already, 61% of charities have had to cut or cancel support for early-career researchers and skilled research roles.
Such a reduction in charity-funded research will have a major impact on the future skills pipeline of research and put early-career positions at serious risk. This means that the UK faces the creation of a lost generation of researchers and experts. Scotland and the other UK nations are world-renowned for research quality. Yet if medical research charities do not receive further financial help, the damage could be significant and, in concert with a hard Brexit, could cause irreparable damage to the sector.
Last month I wrote to the Treasury, supporting AMRC’s calls for the establishment of a life sciences charity partnership fund to support medical research charities. A total of 51 cross-party parliamentarians co-signed my letter, setting out the long-term consequences for the future of medical research and development without this urgent financial support.
We have called on the Government to provide at least £310 million in funding in the financial year 2021 to a life sciences charity partnership fund, to secure medical research for the next three years, thus preserving research charities’ vital and unique contribution to society and to the economy. That would be matched by funding from charities to secure the continuity of their research.
Establishing such a fund would not only safeguard medical research funding at this vital time, but ensure that the research institutions can continue to invest in talent and skills at a time when they are sorely needed. The fund would help contribute to a shared ambition to invest unprecedented levels in research and development across the four nations of the UK, and form a global hub for life sciences. Today’s medical research is tomorrow’s curative treatment. Collectively, medical research charities have saved millions of lives. Thanks to research, cancer survival in the UK has doubled since the 1970s, so that today two in four people survive their cancer.
In the pursuit of addressing the covid health crisis, we must be mindful that, in not delivering support in the form of the life sciences charity partnership fund, we inadvertently create a health crisis caused by stalling, or otherwise compromising, life-saving research from the bench to the bedside.
It is, as always, a pleasure to serve under your chairmanship, Ms McVey. I congratulate the hon. Members for Vale of Clwyd (Dr Davies) and for Bolton West (Chris Green), my near neighbour, on securing this extremely important and well-timed debate. We have heard some good and compelling speeches from across the board, from my hon. Friends the Members for Blaydon (Liz Twist) and for York Central (Rachael Maskell), and the hon. Members for Bath (Wera Hobhouse) and for Kirkcaldy and Cowdenbeath (Neale Hanvey). We are all making similar arguments.
By way of opening, we have heard many debates over recent weeks, both here and in the main Chamber, about the sectors and parts of our society that have been drastically hit by the consequences of the covid-19 crisis. I congratulate the hon. Member for Vale of Clwyd on bringing forward the debate because it is an area that has had a lot less attention than some others.
As others have said, as we are all making similar arguments, medical research charities carry out vital work that helps us to understand diseases and find new ways to treat, manage and prevent conditions. They provide that hope and support for many that would otherwise not be there. As the hon. Member for Vale of Clwyd clearly outlined, we have a world-class sector in the UK. From state-of-the-art brain imaging, which helps us learn more about the earlier stages in diseases such as Alzheimer’s, to the development of novel techniques to help revive and repair donor kidneys before transplantation, and to the study of data to help speed up cancer diagnosis, medical research is changing lives, especially with some of the rare diseases that we have discussed today.
During the covid crisis, charity funding has plummeted, which has had a stark and immediate knock-on impact on medical research, as we have heard. Charities are projecting that it will take more than four years for spend to return to pre-crisis levels. With a big chunk of around half of all medical research coming from charities, we must not underestimate the impact that will have and continue to have on the health and wellbeing of our country for many years to come.
The UK sector is facing an existential crisis, yet, like so many other sectors, it has unfortunately so far been excluded from specific Government support. Medical research charities predict a shortfall in spend over the next year of at least £310 million. Research by the IPPR reveals that medical research charities expect this year to lose 38% of fundraising income, and over 25% next year. The thinktank estimates that there will be a cumulative £7.8 billion shortfall in health research and development investment between now and 2027, or 10% of all UK health R&D.
What does that mean in practical terms? As we have heard in the debate, there is, first, the immediate impact on medical trials and research and on patients and all those affected by disease. Almost three quarters of clinical trials and studies funded by AMRC charities were either scrapped or mothballed during the first lockdown, and although some have been picked since, many have not. Medical studies to be cancelled or stalled include those tackling the UK’s biggest killers—dementia, coronary heart disease and cancer—which could have long-term consequences. The Stroke Association states that three quarters of its funded research projects have been suspended because of the pandemic.
In the long term, less money for medical research means fewer trials and studies and fewer patients able to participate in this life-changing work. Last year, 213,000 people took part in 1,200 clinical trials or studies funded by medical research charities. Medical research charities have played a key role in breakthroughs over the past century, and we heard about some of them today.
The second impact is on researchers and the skilled workforce. Medical research investment is used to fund PhD students, fellowships and other early career researchers. Last year, 17,000 researcher salaries were funded by AMRC charities. Less money simply means fewer of them; fewer of them means losing out on their skills and talents, and on the important scientific progress that they could make in the years ahead. It will also further accelerate the unemployment crisis we face. Sadly, a recent AMRC study found that four in 10 are considering leaving research altogether, owing to funding concerns. The same survey found that 61% of charities have had to cut or cancel support for early career researchers and the skilled research roles.
The third impact is on health R&D funding and the wider economy. Nosediving research and development will affect the whole economy. As we have heard, every £1 invested in medical research delivers a return equivalent to roughly an extra 25p on that investment.
Charity research funding stimulates investment from the private sector, as we have heard, and from universities, further boosting our economy and research sector. It is an ecosystem and it relies on all the system being able to play its part. As my hon. Friend the Member for Bolton West (Chris Green) said, it can and does play a key role in reducing some regional inequalities and, with more than half of medical research coming from charities outside London and the south-east, in the so-called levelling up agenda by contributing to regional economic growth. Charities have a better record in this respect than Government research funding, under which about 80% goes to the golden triangle. There is definitely an opportunity to switch that balance.
Despite the importance of medical research charities to scientific progress and to people’s lives, and despite the significant role they play in our economy, unfortunately the Government have not given them the support they needed during this difficult time. I understand that there are many pressures on the Government’s finances and many calls for help, but only 3% of the country’s medical research charities were eligible for the Government’s charity support package—just five out of the 152 medical research charities. More than 150 were ineligible, and that included those researching conditions such as motor neurone disease, Parkinson’s, breast cancer, hearing loss, bone cancer, liver disease, meningitis, Crohn’s, diabetes, multiple sclerosis and many more. This is a huge blow to patients who rely on breakthroughs in those treatments.
Fortunately, given the well-timed nature of this debate and where we are today, there is an opportunity tomorrow for the Government to rectify that. The Opposition hope that, in the spending review, the Government will consider the proposal for the life sciences charity partnership to help plug the funding gap. This is now critical and urgent, and in the week when the Oxford vaccine for coronavirus has made such brilliant progress, what better way to support the life sciences in this country and recognise their contribution than to support this partnership fund? It would be a partnership arrangement and there would be matched funding. In the grand scheme of things, £310 million would be an investment well made. It is not a huge amount of money.
I am grateful for the powerful points that my hon. Friend is making. In the light of the amount that has been spent on covid-19 and the fact that people have not been able to access regular services in the NHS, does it not bring into scale how £310 million could make a significant difference?
It really does, and my hon. Friend makes a powerful point. I urge the Government to see it, not as day-to-day spend, but as an investment in the future health, resilience, wellbeing and economic viability of the country. I look forward to the Minister’s response and hope that we hear some good news from her today.
It is a pleasure to serve under your chairmanship, Ms McVey, and I congratulate my hon. Friend the Member for Vale of Clwyd (James Davies) on securing this important debate and raising the issues currently affecting medical research charities. I thank all hon. Members for the quality of their contributions to the debate. My hon. Friend the Member for Vale of Clwyd spoke of how the work of the medical charities is invaluable—he mentioned the British Heart Foundation and Cancer Research UK—and of the practical benefits that those charities bring.
The hon. Member for Blaydon (Liz Twist)—who I am sure would look very dignified in a pink boa, as have I, in my time—commented on the work of life sciences charities, specifically in relation to breast cancer. We recognise that work, which affects so many lives. The Government’s research and delivery parties are committed to trying to get the clinical trials started as soon as we can. My hon. Friend the Member for Bolton West (Chris Green) talked about the varied work that is being done, and mentioned the marathon elite runners. I have run the marathon twice, although I am sad to say that this year I was not invited to join the elite runners. The work is incredibly important, and this medical research is constantly on my mind.
The hon. Member for York Central (Rachael Maskell) mentioned the work of the AMRC, also acknowledging what the charities do in giving advice. It is very important that we get that advice and I am sure that it has been welcomed.
The hon. Member for Kirkcaldy and Cowdenbeath (Neale Hanvey) mentioned the work of the Teenage Cancer Trust. We have been able to retain the research that is needed, and we absolutely acknowledge the vital work that it does. We have indicated in our R&D road map that we acknowledge the work of these charities.
The hon. Member for Manchester Central (Lucy Powell) mentioned the work of life science charities and their key role in medical breakthroughs, as well as the many medical research charities that are involved. I would like to acknowledge the work that is carried out by the thousands of charities, including medical research charities, across the UK. The people who work and volunteer for them demonstrate huge passion and a commitment to the incredibly important causes. I saw the passion at first hand during the time I was working at Help the Aged, which is now known as Age UK. I have also seen it in my time as a science Minister when working with the medical research charities over the last year. The research that they collectively support has a huge impact and improves our health and wellbeing, and the Government have been working with them over the past few months to see how the research can be best supported.
Science, research and innovation are central to the Government’s ambitions. As I have mentioned, we published our R&D road map in July to ensure the UK is the best place in the world for scientists, researchers and entrepreneurs to live and work. Although we recognise the challenging economic and fiscal climate, the Prime Minister only this month re-emphasised the importance of science and innovation to our future prosperity and our ambition to move towards investing 2.4% of GDP in research and development. The UK is a world-leading research base and has global expertise across a wide range of disciplines—not least in medical research, where we boast a vibrant ecosystem that brings together researchers in some of the world’s top universities to work collaboratively with their counterparts in leading pharmaceutical companies, clinical researchers in the NHS and those supported by medical research charities.
Charity-funded research has been a distinct part of the UK research system, and I am proud to say that the UK is home to many globally recognised medical research charities, which are an integral part of the world-leading life sciences sector. The health and wellbeing of millions of people in the UK and around the world depends on the medical advances that have come from research funded by charities. I want to take the opportunity to give thanks for the contributions made by research charities, both to the important areas of research that they fund and to the many brilliant researchers they support.
Additionally, the Government have provided significant support to research charities through investments in research infrastructure, such as Manchester Cancer Research Centre and the Institute for Cancer Research in London, which provided the facilities and expertise needed by Cancer Research UK to carry out its incredible work, and through collaborations such as the UK Age Research Forum, where UK Research and Innovation works with a range of charities, including the British Heart Foundation, Versus Arthritis and Alzheimer’s Research UK, to support research that makes a difference to the lives of older people. Through direct funding, Research England is providing £204 million this year to support charity-funded research in universities in England. Through the tax system, over £1.3 billion in tax relief on donations was received in 2018-19 through gift aid, benefiting all charities, including those carrying out vital medical research.
All that shows that we as a Government are committed to supporting research into diseases and conditions that affect so many people around the UK. I know the pandemic has been a challenging time for charities, and that all parts of society and the economy have been affected by the covid pandemic—medical research charities and the research that they support are no exception. We have heard during the debate that they have suffered a series of blows to their income. Many charity shops around the country have been unable to remain open. Fundraising events, which are so important for raising money for research and for raising the profile of these causes, have been cancelled or postponed. The impact of the loss of income has had an impact on the research programmes that charities are currently supporting; as we have heard, it will affect their plans for future research.
In response to the challenges, the Government have provided significant support both across the economy and to charities more specifically. The coronavirus job retention scheme has enabled charities to avoid making staff redundant and to continue their vital work. During these unprecedented times, however, the Government have depended on the expertise of our research base to respond to the enormous challenges we have faced. Our scientists and medics, including those supported by charity funding, have had a key role in taking forward our response to the pandemic. We established a vaccine taskforce to co-ordinate all the work going on across Government, academia and industry, and we accelerated the development and manufacture of covid-19 vaccines. Through the university research sustainability taskforce, we quickly gained a fuller understanding of the impact of covid-19 on research in universities, including that supported by charities.
Many hon. Members mentioned the SURE fund. As a result of the university research sustainability taskforce, we put in place the sustaining university research expertise fund to support university research that has been impacted by the pandemic and to secure researchers’ jobs in universities. The fund has now gone live, with expressions of interest from universities expected this week. Universities are required to pay particular attention to the medical research that charities have traditionally supported when allocating the funding. In addition, we have provided £60 million to support PhD students whose research has been affected or delayed by the pandemic, to give them the time they need to complete their work. We have also supported UKRI to commit more than £95 million to research to tackle covid-19 and we have repurposed research grants with a total value of £80 million to address the effects of the pandemic.
All of that sits alongside the road map we published in July, which sets out the Government’s long-term plan to bolster the UK’s world-class credentials in research and development and to deliver economic growth and societal benefits across the UK for decades to come.
For long-term research projects that take a great while to get off the ground and perhaps recruit people for clinical trials—including people studying at university at the moment—a £320 million commitment tomorrow would give a great deal of reassurance. Obviously the Minister cannot commit to that here and now, but will she reassure us that that is on her mind and that she will make her best endeavours with the Chancellor?
I thank my hon. Friend for that point, which I will refer to in my remarks.
The Government’s goal is to further strengthen science research and innovation across the UK to ignite the UK’s economic recovery, boosting productivity, creating new jobs and improving people’s quality of life. Within that, we also have a commitment to the levelling up agenda. The road map sets out our wish to build on the UK’s strengths in the life sciences sector. I look forward to continuing that work with the medical research charities as we develop a more detailed plan for delivering the road map’s ambitions.
Medical research charities are an important part of the UK research landscape. As I have set out, the Government recognise that and already provide significant support through the tax system, the research funding system and the many measures introduced to counter the impacts of the pandemic. While it would not be appropriate to respond in detail at this stage about the spending review, I assure hon. Members that the issues they have raised have been noted and in the coming weeks we will continue to work with the Association of Medical Research Charities on how they can be addressed, how we can support this vital research and how we can maintain the UK’s excellent capabilities in medical research while recognising the challenging fiscal circumstances we face.
I thank the Minister very much for her response and colleagues in the Chamber for their contributions. We have heard powerfully from everyone about the challenges facing the sector. Numerous vaccines are on the way and we very much hope that by Easter we will have some return to normality. Even so, we have heard how the sector will struggle for many years to come, even in that apparently good scenario.
I thank the hon. Member for Blaydon (Liz Twist) for emphasising the good charitably-funded work she is aware of on breast cancer and muscular dystrophy and by the Alzheimer’s Society. My hon. Friend the Member for Bolton West (Chris Green) certainly took the opportunity to highlight the pandemic’s impact and the importance of supporting research in the north of the country. The hon. Member for Bath (Wera Hobhouse) referred to eating disorders and the hon. Member for York Central (Rachael Maskell) emphasised the difficulties that charities are under, in some cases because of their core costs. I also thank the Front Benchers for all their warm words in that regard.
The Minister kindly outlined some of the support already available to the sector. I know she has listened to the debate and will take back the comments she heard. In particular, regarding the SURE fund, I ask the Minister to take good note of feedback from the charity sector, because I know it has great concerns about how the fund will relate to it. Finally, I ask the Minister to go back to the Chancellor and emphasise the need for this sector to receive assistance, whether through a life sciences charity partnership fund or other means.
Question put and agreed to.
That this House has considered recognising and preserving the value of charity-funded medical research in the 2020 Spending Review.
Pectus Deformity Treatment: NHS Funding
[Relevant document: e-petition 329161, entitled Provide funding for surgical correction of Pectus Excavatum.]
I beg to move,
That this House has considered NHS funding for treatment of pectus deformity.
It is a pleasure to serve under your chairmanship, Ms McVey. I will also discuss e-petition 329161 on the same subject, which I am delighted to say has been signed by more than 6,000 people, including 183 from Middlesbrough South and East Cleveland. I thank everyone who has taken the time to sign the petition, as well as its organisers.
The lack of treatment for pectus excavatum on the NHS is an issue by which I have been deeply moved and for which I am determined that we should deliver lasting change. The situation as it stands amounts to an injustice for a young girl in my constituency and many more like her across the country. It is, however, a matter that can be simply solved. The solution would not be particularly expensive and is not controversial, so I sincerely hope it attracts ministerial support.
About six weeks ago, I was contacted by the parents of Autumn Bradley, a 14-year-old girl from Guisborough who suffers from pectus excavatum. Caused by an overgrowth of cartilage, the condition means that as she grows, her breastbone is being pushed inwards towards her spine. In her case, that inward growth has advanced to the point where her sternum is now just 25 mm from meeting her spine.
For many people living with less severe forms of pectus, its impact is predominantly psychological, but for Autumn, the condition has been nothing short of life-changing. Her parents have watched the physical condition of their once active, energetic daughter deteriorate beyond recognition. Growing up, she excelled at athletics and competed at county level, but today she struggles to blow up a balloon. Complications of the condition have led to numerous hospitalisations, so her school attendance and academic performance are being increasingly affected. It now causes her pain even to hiccup.
Treatment for the condition is effective, routine and widely available across the developed world. It is available free of charge on the NHS in Scotland, Wales and Northern Ireland, but since early 2019, it has not been available to patients in England. Because about 90% of surgeries to treat pectus are deemed to be cosmetic, last year the decision was made that the treatment would no longer be funded by NHS England.
Ruling out treatment for psychological reasons is a debatable proposition, but it is not inherently unreasonable. What is unreasonable is that the 2019 NHS policy document is clear that treatment for pectus will not be available, irrespective of the seriousness of the symptoms. As a result, Autumn’s surgeon, Mr Dunning, has found it impossible to make the case for treatment on an exceptional basis, even in cases where the physical impact of pectus is as devastating as it is for Autumn.
Mr Dunning is based at the wonderful James Cook University Hospital in my constituency. He estimates that, as a result of this situation, about 50 patients a year in England—overwhelmingly teenagers—are left suffering life-limiting symptoms that could easily be fixed. The symptoms include shortness of breath, heart rhythm disturbances and even episodes of collapse.
Mr Dunning spoke recently on BBC Radio Tees about how the current NHS policies affect Autumn:
“I believe it is a complete disaster and a mistake that we cannot turn this around. We’ve found it impossible to change it. We’re looking for anything we possibly can to try and get this poor short-of-breath person an operation. I couldn’t be more confident in being able to fix this poor girl with an operation”.
He said that if he were allowed to carry out the procedure, Autumn would be in hospital for four days with three weeks to recover at home, and after that,
“she’ll be a new person for the rest of her life.”
The average cost of surgery to correct pectus deformity is between £7,000 and £16,000. Treating 50 such patients a year would therefore cost less than £1 million, which, in the context of the wider NHS budget, is a minute sum of money.
Mr Dunning’s passion for helping patients such as Autumn has led him to campaign extensively on the issue and to dedicate a significant amount of time to supporting those affected. His commitment to her care and that of her fellow pectus sufferers is beyond all praise. He represents the best of our national health service. I am equally grateful to BBC Radio Tees and campaigning newspapers such as TeessideLive and The Northern Echo for helping to raise the profile of the issue.
What, then, has gone wrong with the NHS commissioning process? The process, which began in 2015, resulted in a 2018 literature review that considered only six papers, all of which focused on the psychological benefits of surgery. It resulted in the following judgment:
“The evidence that was found is not sufficient to conclude that the physical, psychological, social and behavioural benefits of surgical treatment of pectus deformities are sufficient to justify its use.”
That is despite the fact that the final policy document acknowledged:
“The impact of a pectus deformity can vary substantially, ranging from mild and symptomless to severe and impacting on both lung…and heart…function.”
During the consultation process, the Society for Cardiothoracic Surgery submitted nine additional papers that it felt contained important evidence that should be considered. All nine were rejected, some for what seemed dubious reasons. One study of 168 patients from the United States was rejected on the grounds that a single surgeon performed all the operations, yet most of the papers included in the 2018 review are single-centre studies, and one included paper is explicitly a single-surgeon case series. A 2015 NHS England policy document stated, with reference to previous papers from 2007 and 2010:
“Leading US centres report inclusion criteria for surgery as severe pectus excavatum that fulfils two or more of the following: CT index greater than 3.25, evidence of cardiac or pulmonary compression on CT or echocardiogram, mitral valve prolapse, arrhythmia, or restrictive lung disease”.
For reasons that are unclear, those impacts were not considered by the 2018 literature review. I find it concerning that a submission was not corrected even when highlighted by thoracic surgeons.
The case for allowing surgery for more extreme cases of pectus seems clear, based on the expert reviews that I have seen, which show measurable improvements in cardiopulmonary function in patients with a Haller index of between 4.5 and 5. The Haller index is used to describe the severity of an individual’s pectus deformity. I will outline those reviews, and it is worth remembering that Autumn’s condition is far more severe: she has a Haller index of 9.7.
A 2011 French study of 120 severely affected patients with a mean Haller index of 4.5 showed that surgery delivered sharply improved heart function. Prior to surgery, the maximum rate of patients’ oxygen consumption was just 77% of their age-predicted maximum. One year after surgery, it had increased to 87% of their age-based prediction. A 2013 Danish study with 49 patients with a mean Haller index of 4.9 showed that patients with pectus had a 20% lower cardiac index than healthy control patients of the same age prior to surgery. Three years after surgery, the cardiac index of treated patients had normalised to be similar to the controls.
I am clear that the NHS commissioning process has failed on this occasion. It has excluded crucial evidence about the benefits of pectus surgery for those presenting severe physical symptoms, and it is written too prescriptively to allow any discretion for individual funding requests. Autumn has already been rejected for an IFR twice, despite her life being made an increasing misery by the condition. I defy anyone to explain how in severe cases such as Autumn’s a normal, healthy life is possible without surgical correction of the deformity.
I pay great tribute to Autumn and her mum Sarah. Until now, Autumn has been known publicly as Katie to protect her anonymity, but ahead of this debate she has bravely waived that anonymity for the first time. She has asked me to share with the House, in her own words, how her life has been affected by the condition. She said the following:
“For as long as I remember I have had pectus excavatum.
When I was younger I embraced it as it made me unique. It didn’t affect me massively.
I loved sports, I ran and did long jump for the County competitively, I surfed, climbed mountains, played football with friends, went to scouts and much more.
I spent free time caring for animals in a pet rescue. However as the years went on, my pectus has got progressively worse.
The dent deepened. I began to suffer with my health. Every cold I had went on my chest and needed antibiotics and steroids and I often ended up in hospital.
I began to miss massive amounts of school and all the things I loved.
Fast forward to now. I can’t do any sports, all the clubs I loved have gone. I feel so tired constantly, my ribs and back are in so much pain I take painkillers all the time, but it still hurts.
I can’t breathe.
I can’t take a deep breath—it feels restricted and like my chest is being crushed and I can feel my sternum touching my spine.
Climbing stairs leaves me breathless. I don’t even attend school now.
My dream was to be an athlete or a nurse, my chance of the first dream is gone.
I’m so worried about what the future holds for me as my school grades will start to suffer.
All I am asking is that you reconsider the decision not to offer pectus surgery as it would give not only me, but lots of teens like me, a chance of a normal life like those who are not born with this condition.”
What should be done? I am grateful to the Minister for his time and the consideration he has given the issue in the days leading up to the debate. He is an excellent Minister, and I am all the more grateful given the many other demands on his time because of the wider national situation. Likewise, I am thoroughly appreciative of the time that my right hon. Friend the Secretary of State for Health and Social Care gave me a fortnight ago. He could not have been more attentive, and he joined me and my hon. Friend the Member for Bury South (Christian Wakeford) in a good discussion about what we might do to move the situation forward. Last week he raised the matter personally with the NHS chief executive Simon Stevens.
My central request is that the NHS should be asked to reconsider its wider policy on the issue as a matter of urgency. While such a review is being conducted, and in the interim, it would be fantastic if a holding position could be established, by which there would be a facility for surgeons to appear in person to discuss the evidence for pectus surgery in the most severe individual cases—effectively a kind of extraordinary carve-out from the wider policy. That would reflect a suggestion made by four of the five stakeholders during the commissioning process. It would make sense to allow that subset of severe patients to be identified so that selected centres could perform the operation on the NHS and report their findings in a registry. That commissioning through evaluation would allow a continuation of surgery for that small subgroup, along with monitoring of the impact of the surgery, and the provision of valuable new data to inform a wider policy review.
That would offer both a short-term and a medium-term solution to the issue. No one expects a miracle solution overnight. The process of NHS commissioning is rightly complex and independent. None the less, we should try to kickstart the process today. I should be happy to meet further with the Minister or his officials, but the current policy on pectus excavatum is not right, and it should not continue. I agree with Autumn and her parents, and with experts in the field such as Mr Dunning, that there are cases where pectus surgery is anything but an aesthetic choice. For a small group of young people in this country, it is the only route to anything resembling a normal life, and we should restore the treatment free at the point of need at the earliest opportunity.
It is a pleasure to serve under your chairmanship, Ms McVey. I thank my hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke) for bringing this important topic forward for debate. Similarly to him, I had a constituency case, which involved a 17-year-old girl. Using the Haller index, a value of 3.1 would normally be the threshold for requiring surgery. My constituent had a measurement of 9.6 and was told that her chest capacity was similar to that of someone aged over 100. Her chest capacity was so poor that she could not bend down to pick up the shopping, or go upstairs, without being out of breath. That cannot be right for a 17-year-old girl with her entire future ahead of her.
It is therefore a disappointment that the previous commissioning report suggested that pectus excavatum would not be covered by the NHS. I fully support continuing not to cover the more cosmetic procedures, but for the small cohort in question, which we estimate is fewer than 50, the surgery is a life-changing and potentially lifesaving procedure, especially when it is considered how small the cost is in comparison with most treatment.
I pay tribute to Dr Joel Dunning, to whom my hon. Friend the Member for Middlesbrough South and East Cleveland also referred. My constituent came across him purely by chance, while he was doing some great work during the first lockdown. Obviously elective procedures were cancelled, so he volunteered elsewhere in the NHS—as a nurse. My constituent was in the hospital seeking advice and treatment, and he overheard the conversation. Being an expert in the field he stepped forward and stepped up, and made a representation. My constituent has now had the surgery, as she and her family were in the fortunate position of being able to afford it. They should never have been in that position of having to do that, but her chest capacity has already improved dramatically and she is able to breathe and to walk without getting out of breath. She is still in a lot of pain and on morphine, but she is already feeling the improvements that she should have as a basic right.
It has been suggested that we carry out further studies and recommissioning, but because it is such a small cohort and there are so few experts in the field, it is very difficult to carry out individual studies. My hon. Friend’s proposal that we have a panel from which a surgeon can step forward and make representations on what procedure he thinks necessary and most likely to improve the lives of these young women is the best approach.
I have kept my comments extremely brief because I want to hear from the Minister about the great work that he is doing. I hope there will be more to offer. Again, I put on record my thanks to my constituent’s family, Dr Joel Dunning and to my right hon. Friend the Health Secretary for discussing this important topic for a small cohort of constituents in the middle of the second lockdown.
It is a pleasure to serve under your chairmanship, Ms McVey.
I am grateful to my hon. Friend the Member for Middlesbrough South and East Cleveland (Mr Clarke) for bringing to the attention of the House the issue of funding for the treatment of pectus deformity and the impact that that has on people with that condition. I also pay tribute to my hon. Friend the Member for Bury South (Christian Wakeford), who, in what is a week or two shy of being in the House for a year, has already made a huge impact on behalf of his constituents. I hope that, through him, I can wish his constituent well and a full and speedy recovery from her surgery.
Before I discuss the particular case and issue, I want to place on record my thanks and gratitude to the hard work of NHS staff across the country, who as always have gone above and beyond in supporting us all during the pandemic. We remain indebted to them for their service.
I also want to be clear that the Government have and always will support our NHS, providing it with the finance and resources it needs to continue to provide high-quality, life-changing care. As hon. Members will know, through the NHS long-term plan, we committed to and then legislated for increasing investment in the NHS by £33.9 billion in cash terms by 2023-24.
A fundamental principle of the NHS is that, for people who live in the UK, treatment is free at the point of need regardless of an individual’s ability to pay. That is the basis on which our NHS is built. At the same time, however, clinical commissioning groups have a duty to commission responsibly and to use the funding they have to deliver the best service they can to meet the needs of the overall local population. As such, there will be some treatments or services that are not routinely commissioned locally. These decisions can be difficult but must be subject to rigorous assessment. Surgery for those patients with severe physical complications arising from pectus excavatum is one such area, as my hon. Friend the Member for Middlesbrough South and East Cleveland set out.
NHS England Improvement—which I will refer to as NHSEI for brevity—recognised that a small number of patients might benefit more from surgery and, as my hon. Friend, set out has explored this area in depth. He mentioned that in August 2018 NHSEI launched a clinical commissioning group policy consultation for surgery for pectus deformity and sought feedback on that proposition for surgery for pectus deformity for all ages. In developing its policy proposition, NHSEI commissioned two evidence reviews to ensure that evidence-based surgical outcomes and psychological benefits were considered. The reviews considered whether scientific research has shown treatments to be of benefit to patients and whether its use represents the best use of NHS resources. In that context, I hear very clearly the points made by my hon. Friend about, in his view, the limitations imposed on that by the nature of the process and the evidence base.
As my hon. Friend set out, the findings of the NHSEI findings review concluded, after careful consideration, that for the surgical correction of pectus deformity there was not sufficient evidence to routinely commission that intervention. He has clearly set out his counterpoint to that position. The study, published in February of last year, noted that in most cases, although surgery can correct the chest wall deformity, surgical intervention does not always take. That is because the majority of people experience only mild physical or psychological symptoms associated with having a pectus deformity, according to the evidence put forward by the review. I understand that the review also discovered areas where further evidence was required, and NHSEI has been working with clinicians and the National Institute for Health Research to further build the evidence, to support commissioning decisions.
I want to be clear that although, based on the existing evidence, the current evidence base, surgery for this condition is not currently routinely commissioned, that does not mean that patients cannot access it if it is deemed clinically necessary in particular circumstances, as my hon. Friend the Member for Bury South was able to set out in the case of his constituent. There are processes in place to ensure that, if it is deemed clinically appropriate, patients can still access the treatment even if it is not routinely commissioned by the individual CCG. The process is, as he set out, the individual funding request or IFR, which can be an alternative route, although as my hon. Friend the Member for Middlesbrough South and East Cleveland set out, this clearly has not worked for Autumn.
I turn now to the particular circumstances of my hon. Friend’s constituent’s case. I am incredibly sympathetic to the case that he raises. I understand both his concerns and the need for pace in finding a solution to help Autumn. I will at this point, if I may, pay tribute to my hon. Friend. He is a doughty fighter on behalf of his constituents, as we have seen in respect of this case. We in the House are incredibly lucky, as are his constituents, to have him representing them. I would say that he has made very good use of what I hope will be a very short period of freedom from ministerial office, allowing him to speak in debates such as this. He has used that freedom powerfully once again on behalf of his constituents in bringing Autumn’s case to the House. I hope that his constituents will not take it amiss if I say that although I know that that has been incredibly useful to them and he has been a powerful advocate, as he always is, I hope that his freedom will be short-lived and he will return to the bonds of ministerial office soon, because he was a fabulous Minister while he was fulfilling his various roles.
I also want to place on the record my recognition of and tribute to the courage that Autumn and her mother Sarah have shown. It takes incredible bravery, incredible courage, to speak out and, as Autumn has done through my hon. Friend, to speak out under her own name and her family’s and her mother’s name. That shows a courage that it is very rare to see in any walk of life and in anyone, and I think it deserves recognition by the House. I hope that my hon. Friend will pass on to her my words in respect of that. She is an incredibly brave young lady.
Let me turn to the specifics of the points that my hon. Friend made. Although he will know, and it is only right, that I will caution him that decisions and the response on this of course sit with NHSEI and are not within my gift as a Minister to give, he makes an incredibly powerful case, so what I will say to him is that I am very happy to convey very clearly, as my right hon. Friend the Secretary of State has done, to NHS England and NHS Improvement and to the chief executive, Sir Simon Stevens, his and his constituent’s very clear request that the position be reviewed once again, with additional evidence considered. I will also put to them his very sensible, or what seems to me very sensible, suggestion of an approach in the short term and then in the longer term. As I have said, I have to be honest with him; I cannot make a commitment on what the NHS response will be, because quite rightly it is independent and will make those decisions itself. But what I can promise him is that I will put his case to it very clearly.
I can also reassure my hon. Friend that I am of course always delighted to meet him, and if he feels that it would be useful, I will be very happy to meet him again. We may do that in the next few weeks, while he enjoys a few more weeks of freedom from the red boxes, but I am very happy to do that for him, because this is an incredibly moving case. He has put the case in very human and very moving terms, but I suspect that, if I may put it this way, Autumn in a sense represents probably many more cases, as my hon. Friend the Member for Bury South has set out. They may not have felt able to come forward and may not be publicly known, but there are others who are in Autumn’s position and will be listening to what my hon. Friend the Member for Middlesbrough South and East Cleveland said. I pay tribute to him, as always, for his eloquence, but I have to say I am afraid that although he put the case very powerfully, Autumn’s words put it even more powerfully to the House. There will be people listening to what she said and identifying with that and feeling the same things, so I am always happy to meet my hon. Friend if he feels that that would be helpful.
To conclude, I will reassure my hon. Friends that we will continue to work with clinicians and researchers to build the evidence base and understanding of this condition, to support future commissioning decisions but also, hopefully, within the confines of the clinical evidence base and decisions by NHSEI, to be able to better help people like Autumn in the future. I am grateful to the House.
Question put and agreed to.
Covid-19: Funding for Local Authorities
[Mr Philip Hollobone in the Chair]
I remind hon. Members that there have been some changes to normal practice in order to support the new call list system and ensure that social distancing can be respected. Members should sanitise their microphones using the cleaning materials provided before they use them, and dispose of the cleaning materials as they leave the room. Members are also asked to respect the one-way system around the room.
Members should speak only from the horseshoe. Members can speak only if they are on the call list and cannot join the debate if they are not on the call list. Members are not expected to remain for the wind-ups. Members in the latter stages of the call list should use the seats in the Public Gallery and move to the horseshoe when seats become available.
I remind hon. Members that there is less of an expectation that Members stay for the next two speeches once they have spoken. This is to help manage attendance in the room. Members may wish to stay beyond their speech but should be aware that doing so may prevent Members in seats in the Public Gallery from moving to seats on the horseshoe. There are lots of Members attending this debate, so there will be a time limit, to be advised in due course.
I beg to move,
That this House has considered the adequacy of funding for local authorities during the covid-19 outbreak.
It is a pleasure to serve under your chairmanship, Mr Hollobone. One day, there will be a public inquiry into the conduct of the Government during this pandemic and the decisions they have taken, particularly on the provision of finance to different parts of the country, and we will be able to learn what went well and what did not over the past few months. I hope that we will all support such an inquiry, so that further errors are not made in future.
Even before the pandemic, it would have been hard to argue that national Government were friends of local government and local services. Since the 2010 general election, the Government have reduced funding for local authorities by some £15 billion. The National Audit Office has found that Government funding for local authorities has fallen by 49% in real terms from 2010-11 to 2017-18, and that this equates to a 28.6% real-terms reduction. To put that in context, councils have lost 60p out of every pound they had a decade ago. The Institute for Fiscal Studies concurs, saying that local government spending has “fallen significantly”.
Let us never forget that this is not by accident: it was a decision made by Conservative Ministers and their Liberal Democrat coalition partners in the 2010-15 Government. National Government grants were gradually scaled back, so that poorer areas with great need were not provided with the additional funding they needed alongside local income generation. The cuts made in the name of austerity did not fall equally on the shoulders of people and local authorities: they hurt the poorest and most disadvantaged areas significantly, including areas such as Tower Hamlets, where my constituency is. The IFS says that deprived communities—those communities most reliant on public services—such as those in my constituency saw the greatest reduction in national Government funding.
There is another unfairness to the way in which funding was allocated, particularly Government grants, which have pretty much disappeared. That has made it very difficult for local authorities to deal with child poverty. Unfortunately, my borough, which includes two constituencies—Poplar and Limehouse and Bethnal Green and Bow—has the highest child poverty rate in the country. It is vital that the allocation of funding is fair and addresses the actual needs of communities. According to the Local Government Association, between March and June this year, councils have faced a bill of £4.8 billion because of extra costs and lower incomes due to the coronavirus pandemic. It estimates that the cost of the increased pressures on adult social care alone will be £533 million, and that the figure for public health will be £148 million. Future non-tax income losses due to covid will be about £634 million.
In summary, in terms of funding, the coronavirus pandemic has added even greater challenges to already pressurised local authorities up and down the country. And, of course, the worst challenges have been in poorer areas. I know that many other Members will want to speak of how their own councils have struggled with all those challenges while having to provide much-needed services during the pandemic.
In addition, local authorities have had to rise to the challenge of making up for the fact that the Test and Trace system has been inadequate. It is funded by the £12 billion provided to Serco and other private contractors, but local authorities have had to step in to serve their communities and make it work. They are taking on additional responsibilities because of the pandemic but not getting the necessary funding. The Government promised to provide that funding and it is falling short.
Although I welcome the £3.2 billion of emergency funding and the £300 million of funding for clinical commissioning groups, that still leaves a shortfall of billions of pounds, which is putting local authorities between a rock and a hard place. Labour, Lib Dem and even Conservative-run councils are struggling to balance the books. Some are going bankrupt or have declared bankruptcy. That is a big worry for communities, given that local authorities are on the frontline, cleaning the streets, looking after those who are vulnerable, dealing with the pandemic and providing support, including to the police service, which has experienced cuts, with 20,000 officers taken out of the system over the last decade. In reality, this means that communities such as mine in Tower Hamlets have faced £200 million of cuts over the last 10 years.
The extra costs of covid mean that a further £30 million will have to be found; otherwise services will have to undergo dramatic changes, which will have a damaging effect on people by 2024. At the same time, demand for services has grown. At the height of covid, my area also experienced the fourth highest age-standardised death rate in the country. The health inequalities and other factors that make people vulnerable mean that our local authority has to work closely with other agencies and their resources to protect people. Their actions have saved lives. There would have been an even greater number of deaths if local authorities and partners had not done that work, but they cannot continue to do it without support from national Government.
On education, schools are suffering and need support. Local authorities have worked closely with them to provide that support, but they need funding, as we saw in this summer’s debates about holiday hunger and child poverty. My local authority stepped in a long time ago to help keep children fed, but the food bank queues are astonishing. I would welcome the Minister visiting some of the food banks in my constituency. I joined others in visiting Bow food bank recently. The number of people using it has increased dramatically. They are not the usual suspects who need help because they are extremely vulnerable; middle-income families are also struggling because of covid, employment issues and lack of support. The need is greater, but the funding and resources are not there.
Other services under threat—and not just in my constituency but up and down the country—include those for young people with special educational needs and disabilities and those for young vulnerable children. It cannot be right that, in addition to the double whammy of the coronavirus pandemic and long-term funding cuts, the future life chances of the most vulnerable are being further damaged. We need the Government to act and use tomorrow’s spending review announcement to make sure that local authorities get the support they need to protect our communities.
I am sure that the Minister will say that there are limited resources. Of course there are, but the question is how the money is being used. We have to ask this. Is it right that, for instance, the towns fund—the NAO and others have pointed this out—which is more than £3 billion, is allocated in the way it has been rather than by focusing on indicators of need? That cannot be right. That kind of favouritism is what breeds distrust. It smacks of pork barrel politics and is absolutely unacceptable. How money is allocated and spent is crucial. Of course, there have also been scandals about personal protective equipment and other scandals.
It is right to say that the Government need to refocus their resources in a way that is fair and appropriate, because many local authorities and not just mine—Sunderland, Knowsley, Sheffield, Gateshead, South Tyneside, Oldham and many others—desperately need additional funding but are not getting it. I could go on, and I am sure other hon. Members will, about the number of local authorities that need support but are not getting it.
We need the Government to think quickly and act quickly to ensure that local authorities get the support that they need. If they do not, we will face, in the middle of a second wave of coronavirus—in the middle of a crisis like no other—more lives being put at risk not only by of the pandemic but by the failure to address the secondary effects of extreme vulnerability through local action and support, because local authorities will not have the capacity and resources to act.
I hope that the Minister will take on board my concerns and those of others about children and young people, adult social care and the wider issues of the underfunding and neglect of local government, which is at the frontline of delivering services and does not get the recognition and credit it deserves for the work it does. These are decent public servants who work very hard to deliver for our constituents. We need to back them up and support them, because if we are to fight and win the battle against the coronavirus pandemic, we are going to need them even more than ever before. We are also going to need a collaborative effort from the private and the public sphere to deliver implementation of the vaccine, as well as to improve testing and tracing, on top of all that they already do.
I hope that in today’s debate we can build consensus among Members of all parties to make the case for local government, because it is absolutely at the heart of addressing not only the challenges we face with the pandemic, but the long-term challenges of tackling inequality and genuinely fighting to level up. If the Government genuinely meant what they said in the election about levelling up, they need to put their money where their mouth is and deliver. I hope that the Minister will make that case later today to the Chancellor of the Exchequer, ahead of his statement.
The debate can last until 4 pm. I am obliged to start calling the Front Benchers no later than 3.37 pm. The guideline limits are 10 minutes for Her Majesty’s Opposition and 10 minutes for the Minister, and then Rushanara Ali will have two or three minutes to sum up the debate at the end. There is a stellar cast of Back-Bench talent. Sixteen Back Benchers are seeking to contribute until 3.37, so if we have a time limit of three minutes, everybody should be able to contribute.
It is a pleasure to serve under your chairmanship, Mr Hollobone. I thank the hon. Member for Bethnal Green and Bow (Rushanara Ali) for bringing to the House the issue of the adequacy of local government funding during the covid outbreak, as it facilitates a much-needed debate on both the role of local governments in the crisis effort and the broader interaction between local and national Government.
It was important that any central Government approach to crisis management throughout the pandemic was measured against three key performance indicators. The objectives were, first, to provide adequate financial support to ensure that crucial local government services could continue; secondly, to equip local governments with the tools and flexibility they required to adapt their services to provide targeted support in the relevant jurisdictions; and, finally, that any such support did not create a precedent that would serve to create a further burden on an already overloaded state apparatus.
The figures as of 23 October, without taking into consideration the latest round of business grants, highlight that in my constituency alone, Wakefield Council received an extra £41.52 million to support its efforts in tackling covid-19. This ensured that critical services could continue, despite decreased tax revenues and the higher costs incurred by the pandemic.
In April, £850 million of social care grants, for both children and adults, were paid up front to cover the period from April to June 2020. Although the figures provided by central Government may not have been delivered on a like-for-like basis, they have provided unprecedented sums of money to local authorities, facilitating their ability to use discretion in targeting the needs of their districts as they see fit.
In a crisis, ring-fencing funds for one service may not be appropriate when jobs are at risk and the landlord needs his rent paid, for example. Decisions were made on the best information available at one point in time, and further support was provided where required. One such example was the £617 million discretionary fund, which served as an addendum to the small business rate relief grant and retail, leisure and hospitality grants, and allowed local authorities to distribute further moneys as they saw fit to businesses in need. At the time, I suggested that any underspend from the small business rate relief grant and RHL grants should be combined with the discretionary grant, as a method through which individuals who had been defined as the economically excluded could receive much-needed support on a case-by-case basis.
It is a pleasure to serve under your chairmanship, Mr Hollobone. I thank my hon. Friend the Member for Bethnal Green and Bow (Rushanara Ali) for securing this debate. I want to begin by paying tribute to Wirral Council for the incredible support it has provided to my constituents during the pandemic. This includes instituting a greatly deserved pay rise for care workers, helping homeless people off the streets and into appropriate accommodation, co-ordinating mutual aid efforts and providing much-needed financial support to residents whose livelihoods have been devastated by the lockdown restrictions.
Despite all the difficulties that council workers have faced themselves, their commitment to the poorest and most vulnerable people in our community has always shone through. As a matter of local pride, I would argue that Wirral Council is exceptional, but I note that its efforts are being replicated nationwide and all hon. Members will have similar stories to share.
After years of being underfunded, marginalised and overlooked, local authorities have risen to meet the challenges of covid-19 admirably. This year has shown what a vital role councils play, not just in the provision of services, but as powerful advocates for those people whose voices are too rarely listened to by central Government.
I commend the resolve shown by the metro Mayors, Steve Rotheram and Andy Burnham, when the Government plunged their regions into a tier 3 lockdown with only cut-price financial support, and I was deeply moved by the testimony of the newly elected leader of Wirral Council, Jeanette Williamson, as she opposed the Government’s callous decision to let children go hungry over the holidays. I was also very glad to work so closely with council leaders from across Merseyside in successfully lobbying for the reopening of gyms and leisure centres before the current lockdown was announced.
But now our councils face an uncertain future. Across the country, the threat of cuts to frontline services and even bankruptcy looms. Expenditures have soared while income in the form of business rates, council tax and parking charges has plummeted. Wirral Council faces a black hole of £60 million in its budget, and it is not alone. Last week, the County Councils Network warned that 60% of its members anticipate having to make a fundamental reduction in frontline services, while just one fifth are confident that they can set a balanced budget next year. At a time of spiralling unemployment and a public health crisis unlike any known in our lifetime, we simply cannot afford further cuts to already overstretched and underfunded frontline services. The human cost would be unthinkable.
In March, the Secretary of State for Housing, Communities and Local Government promised that the Government would support councils in doing whatever it would take to protect their communities. Now it is time to honour that promise. The Government should listen to the Local Government Association and provide a minimum of an additional £8.7 billion in core funding over the next financial year. Councils in areas as diverse as Wirral, Nottingham and Gloucestershire have also called for the cancellation of debt held by the Public Works Loans Board. That would massively increase the spending power of local authorities and allow them to make critically important investments in housing, adult social care and green development.
It is a pleasure to serve under your chairmanship, Mr Hollobone. I am grateful to the hon. Member for Bethnal Green and Bow (Rushanara Ali) for giving us the opportunity to pay tribute to council staff across the country.
The whole country has been knocked sideways by the pandemic, and frontline workers in all sectors and industries have stepped up in the most tremendous way, and that really does apply to councils and council workers. They have faced huge costs and huge reductions in their income because of the crisis, but the real effect is not financial. It is on the staff who deliver services for councils. I want to acknowledge that. When we were having the daily press conferences at 5 o’clock, the leader of Wiltshire Council, Philip Whitehead, said to me in despair one evening, “Can we please have the press conferences in the morning,” because all those announcements were coming out and his staff were having to work right through into the middle of the night to respond. That made me realise how hard council staff work, not only out in communities, but in council offices as well.
I want quickly to acknowledge the financial commitments that the Government have made to local authorities through the crisis: nearly £5 billion of non-ring-fenced money, specific grants for a range of special activities that councils have to perform, £6 billion in cash-flow facilities to help councils, and compensation for the loss of fees they have incurred. However, I acknowledge that councils are still out of pocket, and we need to think about how that gap will be met in the months and years to come.
In Wiltshire we have a prudent council that has balanced the books in recent years. It has received additional money from the Government—£15 million is due. That is still to be confirmed, but we trust that it will arrive. Also it has been possible to increase the council tax through the social care precept, which, again, is to be confirmed. We understand and hope that it will be allowed. The authority still faces a budget gap of nearly £30 million, and I recognise that it will be a long task to match and meet that. I hope more money can be found.
I want to finish with two more strategic solutions that all councils have to grapple with, and opportunities that they can take. The first is in reform of social care, which makes up the bulk of spending by local authorities—65% in the case of Wiltshire. I am not going to get into a debate on how to reform social care, but clearly our model is not working and we need to fix it and the financing of it. I support the call by the Health and Social Care Committee and the Housing, Communities and Local Government Committee in the last Parliament for a new model of social insurance to fund social care, which will enable us to get on top of costs.
Finally, I want to pay tribute to a Labour council, Wigan, which, over the last 10 years, has faced all the challenges of austerity, and coped with them by doing a deal with the community of Wigan—the people of Wigan. It kept frontline services open and cut its own back office. It kept the frontline services open by trusting communities and working properly in partnership. That is the model for all of us.
I want to begin by thanking all those on the frontline of the pandemic, working to care for the elderly and vulnerable, collect our refuse, look after our children, and much more. Our frontline local government staff are essential workers in every sense.
We all know that local government funding has been decimated since the coalition Government started a programme of cuts in 2010. Since then, we have been subject to a slash-and-burn austerity programme that has led to councils losing more than half their budget in the past decade. Overall, councils in England can spend £7.8 billion a year less on key services than they did in 2010. That is a cut of £150 million a week. Drastic cuts to local government funding have seen the UK’s most deprived areas shoulder the burden of austerity. Poor areas have faced a threefold impact. They have less money to start with, they have been hit hardest by the demands caused by austerity, and are the least able to meet the shortfall with council tax.
Covid-19 has added fuel to the fire. The financial pressures of meeting the costs of tackling covid include lost income from council tax and other revenues. The total is between £10 billion and £13 billion for councils. I would usually be quick to point out that more is being cut from poor Labour councils than wealthy Tory ones, but after 10 years of cuts and a lack of meaningful funding through the pandemic almost all councils are now at breaking point, including large Conservative-controlled councils.
Naturally, though, I want to talk about Leeds. Our situation is not unique. It represents the situation that many, if not most authorities, are facing, but still the figures create a grim picture. Following significant extra costs relating to covid-19, the council is currently projecting, after the application of Government support, an estimated funding gap of £52.5 million for this year. For the year after, 2021-22, the projected funding gap is £118 million. Leeds City Council may have to make more than £95 million of cuts in the coming months if no extra source of income is found.
Council staff are in the frontline in the battle against this disease. Bus drivers, social workers and public health officials are all vital to the proper functioning of cities—now more than ever. But at Leeds City Council jobs are being hit. The most recent figures put the projected job cuts at around 800 with the current funding gap. The council has done everything asked of it, including lending its chief executive officer to the Government to assist with track and trace and going door to door in areas talking with local communities.
Labour councils in this country have found new ways to help their citizens with the pressures they face. Labour councils make, and continue to make, a huge difference to people’s lives despite a Conservative Government whose policies have left gaping holes in their budgets. I would like to pay particular tribute to Leeds City Council administration, which has done great work in providing frontline services, including to black, Asian and minority ethnic and older people, who have been hit hardest by covid.
The Government must now honour their pledge, do whatever it takes and step up to help with Government underfunding in the future, including in tomorrow’s Chancellor’s statement, to help close fully the funding gap in Leeds of £118 million.
It is a pleasure to serve under your chairmanship, Mr Hollobone.
I start by thanking Suffolk County Council and East Suffolk Council for stepping up to the plate to meet the challenges posed by covid-19. I want to highlight the challenges that county councils face, taking into account my role chairing the county all-party parliamentary group. Councils have been on the frontline supporting communities during the pandemic. This has cost money, and the Government have met covid-related costs through four tranches of emergency funding. However, there is uncertainty about the potential costs of the current lockdown, which will not show on the latest local government returns to the Ministry of Housing, Communities and Local Government.
Covid-19 has starkly exposed the fault lines in the funding of county councils and will exacerbate the underlying financial challenges they face in areas such as adult and child social care, special educational needs, highways maintenance and school and bus transport. The County Councils Network’s budget survey of two weeks ago revealed that just one in five of their 35 council members was confident of delivering a balanced budget next year without dramatic reductions to services. In the following year, only one of those councils is confident of doing so.
In the immediate future, county councils are faced with an overbearing and seemingly insoluble dilemma. On the one hand, they will be expected to, and they will, play their role in the covid recovery. On the other hand, they will find that they have even less money to perform this vital task. Two thirds of the funding that county councils receive comes from council tax, and they will thus be exposed to the difficulties in collection that I fear will be inevitable.
The future is both bleak and intimidating for county councils. In the very short term, additional funds are urgently required both tomorrow and in the local government funding settlement that is due next month. Grants should be provided for three years, not one year, so that councils can plan strategically, and more money is needed for special educational needs. In the longer term, we must fix social care, and the Government must carry out the fair funding review.
It is a pleasure to serve under your chairmanship, Mr Hollobone. I begin by thanking and paying tribute to my hon. Friend the Member for Bethnal Green and Bow (Rushanara Ali) for securing this important debate.
Day in, day out, our local authorities are on the frontline fighting the virus and providing essential services that we all rely on, from bin collections, street cleaning and libraries to children’s services, social care and homelessness support. I pay tribute to all council workers, especially those at Barnsley Council. During the pandemic, we have relied on them to rapidly reorient themselves in a way we could never have envisaged: being on the frontline of the fight against the pandemic as well as supporting their businesses and residents, all while continuing their everyday essential work.
For that, they were promised “whatever it takes”; they should do whatever was needed, and the Government would ensure that they were not left out of pocket. Sadly, the rhetoric has not been matched by reality, certainly not in Barnsley. Our council has done an exceptional job of supporting residents, but that has come at an expected cost at the end of March of £50 million, including around £34 million in support for the most vulnerable and social care and relief to support businesses. The council also estimates around £16 million of lost income from council tax, business rates and fees. The Government income compensation scheme is expected to provide only £2 million to cover that, with that shortfall leaving the council with a loss of £15 million. The Institute for Fiscal Studies estimated the figure nationally at £1.1 billion, and that was before the second national lockdown.
Of course, this follows a decade of austerity in which Barnsley received the biggest cut in Government support of any council in the country. My constituency cannot afford to be left behind by this Government for another decade.
Thank you very much, Mr Hollobone. It is a pleasure to serve under your chairmanship, especially with such kind strictures on the time limits. I pay tribute to the hon. Member for Bethnal Green and Bow (Rushanara Ali) for securing the debate, and to all Members who have spoken so far, all of whom clearly care very much about their communities. This debate should be conducted in a cross-party spirit, and I am sure that the Minister will respond in those terms at the end.
These are extraordinary circumstances. There has actually been an extraordinary response from central Government in terms of the amount of money going to councils, but there has, more than ever, been some extraordinary leadership in local councils. I mean not only the leadership of the councils but the people carrying out their jobs, as my hon. Friend the Member for Devizes (Danny Kruger) mentioned. Everybody on the frontline has shown leadership in responding to the awful circumstances we are in.
To give the view from Staffordshire, Newcastle-under-Lyme Borough Council—a district council—and Staffordshire County Council told me that, by and large, they have had adequate funding from central Government to make up their covid-related losses. That funding has been timely, which they really praised. The Government acted quickly and allowed them to plan ahead, although I recognise what my hon. Friend says about those 5 pm press conferences, which definitely necessitated some late nights. It would be helpful if that was not repeated.
Simon Tagg, leader of Newcastle-under-Lyme Borough Council, says that the Government have listened and given funding to cover the shortfall across council budgets on homelessness, business support and leisure services. That is hugely welcome. Staffordshire County Council has had two leaders during this time, Councillor Philip Atkins and Councillor Alan White, both fine public servants. They estimate that, all in, they have received around £83 million this year in various grants from central Government. They reckon they will have an overall overspend of about £2 million, partly due to delayed cost savings, in addition to some lost income from council tax and business rates.
My councils of course have some asks of the Minister, and it would be remiss of me not to mention them. A lot are about collection fund losses. The Government have promised to bring forward proposals to share collection fund losses where councils will not get as much council tax and business rates in. I have been asked to ask the Minister to ensure that the Government will honour that promise and bring that forward as soon as possible, so that those councils can have some certainty in the year ahead. Newcastle-under-Lyme Borough Council would like more funding to cover the cost of council tax support for people claiming benefits. It expects a big increase in that bill when furlough finishes. Staffordshire County Council highlights long-term concerns around social care and the overall funding quantum for local government. It is essential that they have certainty, so that they can do all they can to help the economy get back on its feet and, of course, to level up.
North Staffordshire is one of the principal targets of levelling up in this country. We have had a lot of support from the Ministry of Housing, Communities and Local Government. I look forward to our future high streets fund announcement and our town deal bid, both of which are coming soon. Councils need certainty about their underlying funding; otherwise, they may be forced to make cuts to the universal services that many people rely on.
I again thank the hon. Member for Bethnal Green and Bow for securing this debate. I thank everybody in Staffordshire, including the leadership, the chief executives—Martin Hamilton and John Henderson—and everybody who has done their part to get us through this pandemic. I look forward to the Minister responding to my points.
At the start of the pandemic, the message from Government to local authorities was clear: “Do whatever it takes to deal with the coronavirus, and we will cover your losses.” Councils across the country have been at the forefront of the coronavirus response. They are facing growing costs and increasing demands, and they have seen significant drops in income. At the time when local services are needed more than ever, our councils are being left to pick up the pieces.
I want to express my gratitude for the support that Bath and North East Somerset Council has provided to services such as the Community Wellbeing Hub and food clubs and pantries. However, despite the initial promises, council funding from central Government has been drip-fed and inconsistent. That creates a high degree of uncertainty about the long-term financial impact on council finances, and it means uncertainty for the core services for our communities.
Bath and North East Somerset Council is one of the hardest-hit by the pandemic. Over the past 10 years, it has done exactly what the Conservative Government asked of local authorities and created its own income stream, but its main funding stream—heritage and parking services—has effectively dried up. In normal times, the Roman bath and other heritage services would generate millions of pounds. At the height of the lockdown, however, the council was losing £91,000 a day from heritage and parking services. The council estimates that it will need to find £29 million of savings over the next five years.
Prior to covid, councils were already facing a big funding gap. According to MHCLG’s financial information service, the financial challenge facing councils in 2020-21 is now £11 billion. The delay in the comprehensive spending review has only created more uncertainty as councils try to set their budgets for next year. When will the Government make good on their promise to cover councils’ financial losses? For example, up and down the country councils such as BANES have outsourced their leisure services to companies such as GLL, a not-for-profit charitable social enterprise, which is already closing leisure centres and will close more unless the Government step in. We all know how important sports and activities are for people, especially for their mental health and wellbeing during the corona crisis.
Local businesses that are renting premises from the council in Bath are also suffering. The council cannot afford to give them more rent relief because it needs every penny to cover the cost of essential services such as street cleaning. Local councils have kept their promises to local people. When will the Government deliver on their promises to councils?
It is a pleasure to serve under your chairmanship, Mr Hollobone. It is clear that the countries that went local early are the ones that have had the most positive feedback about the way they responded to covid. My two local authorities, Hillingdon Council and Harrow Council, are no exception to that: they have redeployed huge numbers of staff from roles as diverse as working in our libraries and the councils’ contact centres to tasks such as delivering meals on wheels to vulnerable residents and back-filling other staff to enable them to be released—for example, to set up and run emergency mortuaries to serve London. There is no question but that council staff are on the frontline of the response to covid.
We have to consider the question of financing and what it means for local authorities in the future. Before this year of covid, local authority budgeted expenditure in England stood at about £99.2 billion. Within that, the official returns from local authorities show reserves of just over £25 billion, of which £23.6 is non-ring-fenced. I dare say that colleagues over at the Department of Health and Social Care will be looking enviously at MHCLG, because whereas DHSC has to bail out NHS authorities every year for the work they do, MHCLG is in a situation that many businesses would frankly be enormously envious of.
The challenge, however, is that we uniquely require local authorities to balance their budgets in year. Unlike central Government, they are not able to borrow to finance revenue expenditure. They have to make sure that those budgets balance every year, so if there is excess expenditure, cuts need to be made. When we begin to drill down into the national financial position, we find that revenue balances to cover the additional costs are not necessarily found in the authorities that have the biggest financial challenges.
The point made by my hon. Friend the Member for Waveney (Peter Aldous) goes to the heart of the issue. Social care authorities face a lot of demand. Certain London boroughs and county councils have the largest number of vulnerable people to support, but a significant proportion of the balance is in other types of local authorities that do not face the same day-to-day costs. I add my voice to the pleas to the Minister that we need to look at how the funding in the system is distributed if we are to do this better. When we drill down even further and look at the response of individual local authorities, it becomes clear that the covid impact is very different from place to place. Around two thirds of the average council’s expenditure is on social care for adults and children, which concerns less than one in five of the population.
The response to covid has brought all manner of new and additional costs, the vast majority of which—according to feedback from Hillingdon and Harrow councils—has been covered by the forthcoming additional funding from MHCLG. I might not be expected to say this as a serving vice-president and former Conservative group leader at the Local Government Association, but MHCLG has rightly been coming forward with that funding. With respect to the points about how expenditure has changed over time, it is important to recognise that many authorities have, of course, not historically benefited from additional funding based on deprivation. Many of the authorities that have been criticised never had the extra money to cut in the first place.
It is a pleasure to serve under your chairmanship, Mr Hollobone. I thank my hon. Friend the Member for Bethnal Green and Bow (Rushanara Ali) for securing this important debate.
As far back as May, I wrote to the Secretary of State for Housing, Communities and Local Government asking for a cast-iron guarantee that the Government would deliver on their promise to cover the costs of local authorities’ response to the pandemic. At the time, Stockport Metropolitan Borough Council in my constituency was facing a shortfall of £41 million, like other councils, and that shortfall has now increased considerably. Six months on, we are still awaiting an assurance from the Government, while local authorities continue to be pushed into the red as they struggle to stump up funds to safeguard the lives of their citizens during the latest wave. Faced with economic ruin, the council was pushed into the dark, as we saw most recently when the London Borough of Croydon was forced to file for bankruptcy after being unable to address a £66 million black hole.
Our councils continue to do the job of ensuring that everyone receives the support they need during this incredibly troubling period. I have enormous respect for them and am incredibly grateful for the work that they have continued to do in challenging circumstances. The deputy leader of my council in Stockport, Councillor Tom McGee, is a fine public servant and I thank him for ensuring that our local public office holders are updated at every stage of the pandemic and are aware of the challenges faced by our local administration.
Nobody expects the Government to have foreseen a global pandemic, but it is clear that a decade of austerity—an ideological choice, not an economic necessity—has ravaged local authority finances and left them weakened, forcing councils to delve into their reserves to redress the central Government shortfall. To put that in context, Stockport council went into the crisis with over £100 million already slashed from the town hall budget since 2010. The council has now been forced to step in to compensate for the Government’s insufficient funding, and local authority budgets are stretched even further. During the first wave alone, the funding black hole for Stockport council was £25 million. Failure to underwrite council expenditure will have dire consequences for my council and leave it with little alternative but to consider dramatic measures such as issuing section 114 notices to curtail all but essential spending, leading to wholesale reductions in services for all those living and working in Stockport.
The Government must urgently intervene to ensure that all councils are in a position to protect their citizens and prevent other services from going to the wall, including libraries, parks, museums and leisure services. Adult social care is one area that cannot be overlooked, and it is already under enormous pressure, as was mentioned by my hon. Friend the Member for Bethnal Green and Bow. The Government need to resolve the funding crisis in the adult social care sector. The Local Government Association recently estimated that social care services face an additional cost of over £6.5 billion to cover costs. The main three areas are PPE, increased staff costs, and increased cleaning and overheads.
In addition to the vast expenditure that local authorities are forced to cover during this period, many have seen their incomes cut dramatically. Every council in Greater Manchester, for example, has been hit by the drop in the dividends from Manchester airport on which it relies. For Stockport council, that means that more than £6 million has been lost, placing further strain on services and jobs—and that is even before we factor in the significant number of jobs lost in the aviation sector more widely, where many of my constituents work in the UK’s third-largest airport.
It is a pleasure to serve under your chairmanship, Mr Hollobone. I thank my hon. Friend the Member for Bethnal Green and Bow (Rushanara Ali) for securing a debate on this topic, the impact of which is felt by our constituents deeply. As a Member in the London Borough of Tower Hamlets, she is right to highlight that the area has the highest rates of child poverty in the country.
The covid-19 crisis has emphasised starkly the importance of local services in making sure the essentials of life are never denied to people because of their circumstances. As has been argued by others, at the core of the issue is the need for sustainable core funding for local government—a need that is urgent and critical, and yet this year’s spending review will not be comprehensive. The multi-year review that we were originally promised is unlikely to deliver funding for local services at the level required, nor is it likely to recognise the role of Government investment, public ownership, in-sourcing and care in what must be a green sustainable recovery that delivers for people. On top of that, there is a public sector pay freeze looming for public sector workers who have kept the country running throughout the pandemic.
People all over the UK are being let down by patchy support measures that result in unfairness, injustice and hardship. That is despite people continuing to work hard, whether it is from home, in cramped conditions with limited equipment, balancing paid work with caring responsibilities; being forced to work in unsafe conditions without the protections needed; or supporting others around them unpaid. The challenges in my borough cannot be underestimated. We have the fastest-growing population in the country—it has doubled in the past 30 years and is projected to grow by a further 67,000 in the next 10. As demand increases, funding reduces.
Universal basic services, of which local services are a cornerstone, was an idea at the heart of the 2019 Labour party manifesto that I was elected on. It was not only about protecting the free services that we have; it was a vision to extend the services that we should all have access to, from free travel on buses for the under-25s and full-fibre broadband free for all, to free school meals for primary school children. In health, it filled the gaps in hospital car parking and dental care. In social care, it addressed the crisis by pledging free personal social care. Despite the barrage of criticisms by the right-wing media during the election, that never sounded like a wish list to me, but rather the foundation for a decent life for everybody in the 21st century. It is an idea that has underpinned our treasured public and local services ever since Beveridge argued for the state provision of national minimums for essentials.
Collectively provided services such as our schools, libraries and parks do not just bind us together as a society; they transform lives. Events this year have made that truth even more clear. Yet just today, a report by Victim Support further emphasised the need for victims of domestic abuse, who are in urgent need of additional support as the country looks ahead to months more of lockdown restrictions. It is overwhelmingly obvious that years of cuts and a failure to invest in services made the UK extremely ill prepared to deal with a large-scale health risk to our community. Further cuts on the horizon to services such as special educational needs support, adult social care, library services and leisure centres, to name just a few of the areas that I am being contacted about by constituents, will have a disastrous impact on local people and communities that were already vulnerable before the pandemic.
It is a pleasure to serve under your chairmanship, Mr Hollobone. I congratulate my hon. Friend the Member for Bethnal Green and Bow (Rushanara Ali) on securing this important debate.
Speaking as a sitting councillor on Luton Borough Council and as a vice-president of the Local Government Association, I too thank all the officers and workers at Luton Borough Council, and all those working in councils across the country who have shown brilliant leadership and determination throughout our coronavirus response. Their local expertise has been critical to delivering services for our communities, from supporting the roll-out of testing to ensuring that the most vulnerable can access food. It is important to note that they have worked alongside NHS and other public service workers, including the fire and rescue service and the police.
Local authorities across the country have stepped up, as we know, delivering vital additional support at pace, despite suffering a £15 million cut in core local government funding since 2010. As was mentioned, the National Audit Office has calculated that local authorities have seen Government funding reduced in real terms by almost a half since 2010-11. Austerity has left many councils understaffed and underfunded, with demand for many services, such as adult social care and children’s services, increasing. The pandemic has compounded those existing difficulties through extra costs, lost income and cash-flow pressures.
Since 2010, Luton Borough Council has had £138 million cut from its budget. It tried to mitigate the impact by generating increased income from Luton airport, which it owns, to fund council services. However, covid-19 health restrictions affecting aviation have caused that income to dry up, meaning the council will not receive its forecast £20 million annual dividend and the £9 million donation to our local charity and voluntary sector is at risk.
Although the Government stated that councils would receive the support they need to get through the crisis, and have acknowledged Luton Borough Council’s exceptional circumstances due to the airport, there is a requirement for local councils to set balanced budgets in year, so in the absence of any specific and exceptional Government finance to compensate for loss of commercial income, Luton Borough Council has had no choice but to implement an emergency budget that has made £22 million of in-year cuts. This is affecting our non-statutory services, which are highly valued by local residents. At a time or rising unemployment, 400 jobs will potentially be lost.
I recognise that the Government have made some additional grant support to councils, but it barely scratches the surface of the problem. Without a funding package that considers years of underfunding under a decade of Tory austerity and the instability caused by the pandemic, services in adult social care, public health, homelessness support and children’s services are at risk. The Local Government Association is calling on the Government to provide an additional £8.7 billion in core funding in 2021-22. That consists of £4 billion for the current funding gap to sustain 2019-20 service levels, £1.8 billion to deal with other quantifiable pressures to stabilise the sector, and £2.9 billion for other core funding requirements to help councils improve their core service offer.
We also need a long-term council funding review that begins to rebuild local resilience, as local councils must be at the heart of building back better in our communities. For the sake of our communities across the country, I hope the Minister has been able to persuade the Chancellor to announce a package along those lines in tomorrow’s spending review.
It is a pleasure to serve under your chairmanship, Mr Hollobone. I congratulate my hon. Friend the Member for Bethnal Green and Bow (Rushanara Ali) on introducing this debate. I am increasingly concerned about the finances of City of York Council, in terms of both sufficiency and its investment choices.
Staff have been incredible in the way they have stepped up in this crisis, working in the most difficult circumstances and going above and beyond. Social care staff have put themselves at risk to meet demand. Social workers have found new ways to safeguard children. Refuse staff have continued to keep our streets clean and bins emptied. There are so many more I want to thank today. The increased demand on them must be recognised. More than claps and kind words, they must receive a proper pay rise this year. If the Chancellor reneges on that, it will never be forgotten.
In York, due to the high rateable values, need has not been met by grants. As offshore landlords have pocketed the benefits of these grants in their tax havens, businesses are vanishing from our high street. Labour wants councils to be able to support the local economy. In York, where 30,000 people work in hospitality, retail and tourism, we have the worst-hit high streets in the country and are one of the worst affected places in general. The 8 million visitors who normally come to our city just are not there.
I want to point to a few specific areas. We know there has been increased demand in domiciliary care, because families are not placing people in care homes for fear that they will not be able to visit and because of the risk of infection. The costs have increased significantly over the last few months and must be met. The same is true of charities. When it comes to the end of the financial year, many are fearful that they will not see their contracts renewed. Already £10 billion in debt, they need security in order to safeguard their futures. As the sector says, charities have never been needed more, but we must also recognise that they have never been more in need themselves.
On public health, it has been an incredible story in York. As we were heading into tier 3, we were able to turn the ship around, bucking national trends and reducing infection rates considerably. Contact tracing has been at the heart of that, yet we need more funding to do more to ensure that we lock down this virus in future, not people or the economy. I trust that the Minister will look at the resourcing of public health to ensure that it can do its job with sufficiency.
On the investments of City of York Council, at the heart of my constituency is York Central, the largest brownfield site in the country—I know that the Minister and I are going to discuss this. City of York Council has invested £35 million, which will turn out to be about £57 million. The other delivery partners, Network Rail and Homes England, will get their costs back plus 20% profit from the development, but City of York Council will not see such a return.
That needs scrutiny, not least in the light of the current situation, and because of its other poor investment choices, such as paying out £500,000 to a former chief executive, which the auditors are, rightly, not happy to sign off. There is something that needs investigation, and I trust that my discussions with the Minister will get to the bottom of those issues so that we can spend our money wisely in our city.
Local authorities all over the country are the frontline in this public health crisis. As a recent all-party parliamentary group on faith and society report shows, councils have set up imaginative partnerships with faith groups to provide food and care to struggling families. I support the call made recently by the hon. Member for Devizes (Danny Kruger) in his report to the Prime Minister for a new deal for faith groups.
Covid-19 hit Newham, my very diverse borough, extremely hard. It is next door to Tower Hamlets, which we heard about from my hon. Friends the Members for Bethnal Green and Bow (Rushanara Ali) and for Poplar and Limehouse (Apsana Begum). As elsewhere, the council has been imaginative and effective. It recruited volunteer health champions to disseminate key health messages and to obtain feedback from the community. It set up Newham Food Alliance with faith and community groups. Bonny Downs Baptist church, Highway Vineyard church, Manor Park Christian Centre, Ibrahim mosque and the Newham Community Project have all done extraordinary work in East Ham.
The council has increased support for temporarily accommodated homeless families and it has extended support to rough sleepers and families with no recourse to public funds. It has spent £25.3 million extra on the pandemic this financial year. It has lost £13.3 million in income and has been unable to deliver £7.4 million in planned service cuts. That is a £59.5 million hit, but Government funding has been £36.8 million.
Some 3 million extra people have had to claim universal credit this year, but hard-working families, who work legally but have no recourse to public funds due to their immigration status, do not have that safety net. They can get council help under section 17 of the Children Act 1989 if they have children, and under the Care Act 2014 if they need additional care.
In March, local authorities were told by the Minister to support single homeless adults without care needs. I very much applaud his initiative—I wish the Home Office had shown a similar degree of enlightenment—but there was no clear legal basis for that instruction, so provision has varied immensely.
Local welfare assistance and £500 track and trace payments are available for families with no recourse to public funds only by discretion. Andy Jolly of the University of Wolverhampton reports that many families were refused council help during the pandemic. We need new funding for basic council support for families with no recourse to public funds. Will the Minister commit to providing it?
It is a pleasure to serve under your chairmanship, Mr Hollobone. I thank my hon. Friend the Member for Bethnal Green and Bow (Rushanara Ali) for securing this important debate. I also thank and pay tribute to everyone at Coventry City Council who has worked tirelessly through the pandemic, as they did before it hit, to care for the city’s residents and keep services going, even as workloads have been stretched and budgets have been pushed harder.
The truth is that local authority budgets were in crisis way before the pandemic. They have faced a decade of brutal Tory cuts. In Coventry, that has meant a cut of £120 million to the central Government grant every single year since 2010, meaning a total reduction of funding of £1.2 billion to date. That amounts to nearly £350,000 in lost funding every single day.
It is a similar story across the country. The National Audit Office estimated that between 2010 and 2018 central Government funding for councils was slashed by nearly 50% in real terms. Those cuts have meant a decade of youth club closures and children’s centres having to shut down, and domestic violence refuges and homeless shelters being forced to close their doors. My inbox is inundated with people struggling on the housing waiting list, which now stands at 14,000 people in Coventry. That is what a decade of Tory cuts looks like.
Local authorities have now been rocked by the impact of the pandemic. Councils have been forced to spend more to meet rising needs, and their budgets have been hit by a loss of income in tax receipts and business activity. When we take into account the effects of austerity and covid on local authorities, we see how utterly inadequate the Government’s funding announcements truly are. Councils do not just need eight months of funding to be plugged; they need 10 years of cuts to be reversed.
The crisis has highlighted how fundamental our local authorities are and it has shown who our key workers really are, too. They are not the hedge fund managers or the City bankers, who have had it so good for so long. They are the carers looking after our older residents in Coventry, the refuse collectors and the street cleaners, and the working people who have kept our country going. I will finish by placing on the record my thanks to them.
I call on the Government not only to compensate local authorities for temporary funding shortfalls, but to give them the funding and the powers they need to tackle everything from the housing crisis to the social care crisis, to give low-paid staff the pay rise they deserve, and to truly meet the needs of our communities.
It is a pleasure to serve under your chairmanship, Mr Hollobone. I pay tribute and give my thanks to the hon. Member for Bethnal Green and Bow (Rushanara Ali) for securing this important debate.
I will focus my few remarks on the support that local authorities have given, and continue to give, to businesses. Thanks to Government support, South Lakeland District Council provided the largest single number of grants to local businesses of any shire district anywhere in the country, and it is not hard to understand why that would be the case. We are the tourism epicentre of the United Kingdom and, after London, the biggest visitor destination in the country. The largest single employer is hospitality and tourism, and at the worst part of the crisis 40% of the entire workforce of my constituency was on furlough. We have seen a sixfold increase in unemployment.
The diversity of employment is significant as well. One in four people in my constituency work for themselves. At the beginning, after initial grants and furlough, which were very welcome, were correctly provided by the Chancellor, there were some gaps in support. Discretionary awards were then made through local authorities and delivered expertly, fleet of foot, by local authorities, including my own in South Lakeland, to people such as small bed and breakfast owners, those who ran businesses from their own home or shared space with others, or those who did not get any support in the first tranche. Thanks to the campaigns of many and the Government listening, on that occasion, district councils such as mine were able to provide support, and they have done so well.
That gives us a clue as to how the Government should behave towards the remaining 3 million people who have still received no support. I am thinking about many people on maternity leave; people who have been self-employed for less than 18 months; those who are running small, limited companies, such as taxi drivers, hairdressers, personal trainers and the like; and those who just missed the cut-off date for the payroll, at just the wrong moment in March.Those people have been left with zero support since March and are struggling to pay their rent or mortgage and feed their kids. I pay tribute to them for their campaigning. I beg the Government to allow councils to do for those people what they did for the first set of excluded people back in March and April.
I thank councils for all they do at the forefront, providing social care, schools, special educational needs provision and child protection, and looking after the homeless and those in housing need. I am confident that in Cumbria we had the most effective localised Test and Trace system in the country, with public health being run incredibly well at a local government level in my community.
I will just say, on top of all that, how odd it is that the Government think this is somehow a bright period in which to force top-down reorganisation of local government in Cumbria, North Yorkshire and Somerset. Even if a Government thought there was some wisdom in changing the balance of local government in those places, how crackers—how out of touch—would they have to be to think now is the moment to do it? I urge the Minister to provide funds for local authorities to support those who have been excluded from support so far, and to not distract our social care home managers, our carers, our teachers, those people caring for the homeless, and those leading the economic recovery in our communities. Do not divert them from their vital task by a pointless act of navel contemplation—a top-down reorganisation.
It is a pleasure to serve under your chairmanship, Mr Hollobone, and I congratulate my hon. Friend the Member for Bethnal Green and Bow (Rushanara Ali) on securing such an important debate.
I will start by paying tribute to the council staff across England who have worked so hard to keep our communities safe in difficult circumstances throughout this pandemic. I have seen at first hand the efforts of council staff workers in Bradford West from the very outset of this virus—the hard work they do to minimise and prevent the spread of infection, get help to the vulnerable and support the care sector, work to sustain our businesses and the economy, keep essential services such as refuse collection and bereavement going, and much more, including setting up local Test and Trace services before there was any commitment or financial support from the Government. That has been the case for councils up and down the nation.
However, local government is at a crossroads. A decade that saw £15 billion cut from local authority budgets has ended with the impact of covid-19 driving up costs and cutting income, leaving councils across the country facing huge challenges to set a balanced budget. Many of my colleagues have mentioned those budget cuts, particularly my hon. Friends the Members for Leeds North West (Alex Sobel), for Barnsley East (Stephanie Peacock), for Stockport (Navendu Mishra) and for Poplar and Limehouse (Apsana Begum). The numbers do not look good for any of those constituencies.
Without proper funding, there is a real risk that councils will not be able to balance their budget, as they are legally required to do. Councils do not want to have to make those hard choices, but they have been left with little choice by the Government. Vulnerable people across the country will suffer the most if councils are forced to stop delivering the crucial services they rely upon. The tragedy of this is that after a decade of austerity, councils will be forced to cut back on funding again. Additionally, it has been reported that the Chancellor is considering a public sector pay freeze. Can the Minister clarify whether he feels comfortable clapping public sector workers as we entered the pandemic, and cutting their futures as we start to come out of it?
Since the beginning of the pandemic, councils have sent detailed financial returns to MHCLG each month, so this time around, the Government cannot feign ignorance. Ministers know exactly how much local government is out of pocket by. Despite the fact that at the Government’s daily press conference in May, the Communities Secretary said he would “stand behind councils”, it is clear to leaders of those councils that that promise will not be kept. Nor is this a short-term issue that will go away after covid; these funding pressures are cumulative. Councils are losing out on fees and charges from sources such as leisure centres and car parking: as my hon. Friend the Member for York Central (Rachael Maskell) said, York has lost 8 million visitors due to covid-19.
There is no guarantee that there will be a return to normal next year, either, and it is not just me saying that. According to analysis by the cross-party Local Government Association, councils in England will face a funding gap of more than £5 billion by 2024 just to maintain services at current levels. The present national lockdown has no doubt made the funding crisis more acute. The same concerns have been raised by the Conservative-led County Councils Network, and the evidence from witnesses at the Select Committee on Housing, Communities and Local Government has been equally concerning. I also agree with the concerns that the chair of the all-party parliamentary group, the hon. Member for Waveney (Peter Aldous), mentioned earlier.
I hope that the Minister can provide some clarity about how the Government intend to deal with the huge challenges facing local government, and that he will be able to answer some questions. However, before I get to those questions, I want to talk about places of worship. My right hon. Friend the Member for East Ham (Stephen Timms) highlighted the role of mosques. I have seen at first hand the role of mosques in my constituency, but ahead of the spending review, I have also had some conversations with local churches. The churches, mosques and all places of worship in my constituency have already been picking up the pieces of 10 years of austerity from Government cuts, including through food banks; across the country, each church equates to £300,000. There has been no commitment to help where churches or mosques are picking up the council pieces. Can the Minister highlight what is going on with the funding allocated to places of faith?
I understand that the Prime Minister’s adviser, Sir Edward Lister, wrote to councils under tier 3 restrictions to advise that they would not be asked to set a balanced budget this financial year. Will the Minister clarify how that will work and whether it will apply to those councils that are subject to increased restrictions after 2 December? Will he also clarify how much has been paid to local government to date, through his Department’s scheme to replace lost income and fee charges? Will he say whether his Department is considering further financial support for councils returning to the higher tiers of local restrictions after 2 December? Can he confirm whether that will be based on need or per head of population?
The Transport Secretary highlighted today that the Government would not engage with regional Mayors as we enter the new tiered system. Have the Government abandoned their pledges on devolution, and should we expect further Whitehall rules for the future of this Government? Finally, will the Minister clarify when the local government financial settlement for 2021 or 2022 will be published? My hon. Friend the Member for Bethnal Green and Bow (Rushanara Ali), who secured this debate, laid out very eloquently the challenges that are faced. Councils have to make a choice: will they cut library services, refuge services, frontline workers, bin collections—what will face the axe next? Councils are between a rock and a hard place when making these decisions.
We have already seen the fiasco where the Government took the decision to centralise Test and Trace and give the contracts to Serco. My understanding is that Serco did not even have any penalties in its contracts. In my constituency, and others I have seen with a high prevalence of covid-19, people have been door-knocking and managing to test, isolate and track people locally. They have managed to isolate outbreaks, but the Government are not putting their money where their mouth is. That is an added pressure to those that councils already face.
We have had 10 years of austerity, followed by covid and a Government who have gone into national lockdown instead of taking a circuit breaker, which we advocated. That has had even more of an impact on our councils. They really need certainty. In Bradford, our councils have already had so many cuts, as have the councils of every Member on both sides of the House. Nobody is denying that we have had cuts for the last 10 years. Will the Minister confirm that the Government will be putting their money where their mouth is? Did they mean it when they said, “We will do whatever it takes”? Will he give the councils that reassurance?
It is a pleasure to serve under your chairmanship, Mr Hollobone, and to be back in Westminster Hall after such an absence. It is an important Chamber in which to hold debates such as this one, to raise issues such as local government finance and so on. I am hugely grateful to the hon. Member for Bethnal Green and Bow (Rushanara Ali) for securing the debate and for opening it in such a pragmatic, sensible, level way, which highlighted some of the issues facing local government. I thank her for the tone in which she opened the debate and I thank hon. Members for their contributions. I will do my best to address all the points that have been raised.
First, may I place on the record my thanks to local government? The work that those who serve in local government have done in these extraordinary times has been remarkable. They have risen to help us as a country respond to the incredible challenges we are facing and worked tirelessly to help us through the pandemic. From their incredible work protecting rough sleepers, offering over 90% of them accommodation within just a few days of the start of the pandemic, to the work they have done on testing, alongside NHS staff, to keep our parks, public spaces and schools open, and helping vulnerable people, including victims of domestic abuse, the response has been truly remarkable. I know that if the Secretary of State and the Prime Minister were able to attend, they would put on the record their thanks for the remarkable work of councils, councillors and officers around the country who have done so much to support their communities, their businesses and vulnerable people.
Much of today’s debate has been about the response to the pandemic, so I will start my remarks there. In responding to the pandemic, we have built on what was a good local government finance settlement for this financial year: a 4.4% real-terms rise in core spending power for councils. We were genuinely grateful for the Opposition’s support for that finance settlement and hope to have their support again. Clearly, they will look at the detail carefully when the Chancellor makes his statement tomorrow and when the settlement is published, but we were grateful for the cross-party support this year, which we hope will be forthcoming again.
We have been determined that no local authority should face unmanageable spending pressures because of coronavirus, and we will continue to deliver on that commitment. That is why, following the announcement of the winter plan this week, we have allocated up to £8 billion this financial year to support councils throughout the pandemic. Crucially, that includes £4.6 billion of non-ring-fenced spending so that councils can make decisions at a local level about how that money is spent and how resources should be deployed, because councils know their communities best and are best placed to make those decisions.
A number of hon. Members mentioned the financial returns that we have asked councils to submit throughout the pandemic. I am grateful to councils for doing that so diligently. Our information shows that councils spent £3.6 billion from March through to the end of September on covid-related pressures, so we hope and expect that £4.6 billion of non-ring-fenced money has helped councils with those expenditure pressures.
It is worth putting on the record the other support that local government has received from Departments across Whitehall since the start of the pandemic. That has included: £1.1 billion for the infection control fund, which has helped support adult social care providers to reduce the rate of transmission both in and between care homes, and to support the wider workforce, which has been vital; £300 million of support for councils’ Test and Trace activities; £485 million to support implementation of the national restrictions, which has been extended to the end of the financial year; £91.5 million for councils to ensure that rough sleepers do not return to the streets, as announced in September; £170 million for the winter grant scheme to support families and children; and over £22 billion in grants and reliefs for businesses at this challenging time. We believe that funding package is unprecedented.
Hon. Members commented on what extra financial support will be available now. I reiterate the point made yesterday by the Prime Minister, who confirmed further support for councils as we return to the tiered system of local restrictions with the extension of the contain outbreak management fund for the rest of the year. That will mean a payment from the Department of Health and Social Care to upper-tier local authorities of £4 per person per month in areas with very high restrictions for the rest of the financial year.
Hon. Members made points about the distribution of funding throughout the four tranches of local government finance support since the start of covid. We have distributed non-ring-fenced funding using a covid relative needs formula. It is important to state that the formula accounts for the main drivers of covid-related expenditure. Yes, of course that includes population, but it also includes deprivation, which is crucial, as well as the various cost adjusters for delivering services in different parts of the country. We think that was the right system when considering how to distribute money between councils.
Members also pointed out that it is not only additional covid spending pressure that councils have faced; many have also had to deal with tax and income losses. That is why, alongside the funding we have put into local authorities, we have introduced measures to help them manage the loss of income from tax and transactional services, sales, fees and charges. That is a substantial scheme. It compensates councils for lost income from key services, such as car parks and libraries, which are normally funded through sales, fees and charges but clearly have been largely closed or underused during the pandemic. Alongside that, we have given councils the flexibility to spread their tax losses over multiple years, rather than the usual one year. We have committed to set out further details at the spending review—we do not have too long to wait—on how we will apportion the lost tax income between central and local government. I know that councils are keen for clarity on that point, and it will be provided shortly.
There were a number of representations about the spending review itself. I understand that this is a perfect time for that conversation to happen, and those points have been made. I will answer some of the points specifically, but the representations about spending for local authorities, an increase in core spending power, social care funding and the share of the council tax burden and grant have certainly been heard. Those points were well made.
The hon. Member for Poplar and Limehouse (Apsana Begum) mentioned the one-year spending review and how it would have been more suitable to have a longer-term settlement. I understand that point, but unfortunately we are in a place now where long-term planning is difficult to pursue, so we think it is right to concentrate on the covid-19 response. However, we absolutely share councils’ desire to return to longer-term financial planning. That has been a key ask of councils, and once we are through the pandemic we aim to hold a multi-year spending review settlement.
The hon. Member for Bradford West (Naz Shah) asked a number of questions, which I will try to address. She asked about engagement with regional Mayors. That is a really important point. The Secretary of State and I spoke to all regional Mayors across the country last night. We have an open offer of conversation and continued engagement with them. We also had a webinar with local authorities yesterday, which every leader and chief executive was invited to. Hundreds of councils joined that call, and that engagement is hugely important to us as we progress through this period. We actually continue to have regular webinars and discussions with council leaders across the country, answering their questions on an almost weekly basis, which has been hugely informative.
I hope that I have answered part of the point that the hon. Member for Bradford West raised about the £4 per head in new funding. If she wants more detail on that after tomorrow, I am happy to set it out for her in writing. She asked about lost income and how much of that is being paid out. Most councils have now been informed about the first tranche of payment that is being paid out—millions of pounds. I am happy to share the details with her if that is desirable. She also mentioned public sector pay in local authorities. It is important to note that local authorities, working with unions and other employer bodies, take these decisions externally of Government, but she is absolutely right to put that on the record.
My hon. Friend the Member for Ruislip, Northwood and Pinner (David Simmonds) made sensible and important points about the long-term sustainability of funding and about funding reform. We would have liked to come forward with the fair funding review this year. Clearly, that is not possible in the current circumstances, but we continue to have that conversation. My hon. Friend the Member for Waveney (Peter Aldous) talked about the funding challenges facing counties and made important points about the spending review and the settlements. Those representations have absolutely been heard.
My neighbour, the hon. Member for Bath (Wera Hobhouse), who has understandably left the Chamber, made important points about the specific circumstances facing her local authority, which is unique in a lot of respects. I point her towards the sales, fees and charges scheme, which compensates councils for 75% their losses beyond the first 5% of planned income. I am always happy to meet her to discuss those unique circumstances. She also asked for certainty about leisure centres. The Department for Digital, Culture, Media and Sport will shortly set out more detail about the £100 million scheme for leisure centres. She makes an important point about the importance of those institutions for people’s physical and mental health. She is quite right to raise that.
The hon. Member for Luton South (Rachel Hopkins) talked about the genuinely unique circumstances that face her council. I hope she feels that we are working with her constructively. It is a unique situation and I am always happy to meet her and her council leader to discuss it, if that would be of use. I absolutely recognise the point she raises.
The hon. Member for York Central (Rachael Maskell) also raised the unique circumstances facing her local authority. I know that we are planning to speak soon, and I look forward to addressing the issues then. She also mentioned the spending review and local government pay, which I hope I have covered in my remarks.
The right hon. Member for East Ham (Stephen Timms) raised a number of issues. I join him in putting on the record my thanks to the incredible organisations in his constituency and his local authority for the work they have done on rough sleeping, which I know is a huge challenge. I know how committed they are to that issue and to supporting people. I thank them for the work they have done in the “Everybody In” campaign. He also made passionate points about those with no recourse to public funds. I think we have made changes on that issue during the course of the pandemic, including extending the derogations to ensure that everybody can receive that basic safety net of support, further than the areas it had already been extended to.
The hon. Member for Westmorland and Lonsdale (Tim Farron) talked about some of the excellent work that his council has done, paying out grants and supporting businesses, and I commend it for that work. He also had passionate views about local government reform and the timings. He will be able to make that argument through the process in the right way. I know he feels strongly about the matter.
I want to thank again the hon. Member for Bethnal Green and Bow, who made a number of hugely important points. She talked about targeted funding. I hope she feels that we are doing that through the equalisation we did last year, to ensure that the local authorities affected most by the social care precept are seeking that extra support. I thank her and I am at her disposal, if she needs to talk about that further. I would like once again to thank all local authorities up and down the country. I believe that this unprecedented package of support is supporting those councils and I thank them for their work.
I thank the Minister for his response and the shadow Minister for her contribution. I want to reiterate my gratitude to local council leaders and officials up and down the country, and to all those working with them. Others have talked about interfaith organisations and I pay tribute to the interfaith groups in my constituency, who acted weeks in advance of the lockdown, which I know saved a lot of lives. That is credit to the local authority and its co-ordination efforts.
I also want to pay tribute to the mayor, deputy mayor and councillors in my constituency, and the chief executive of Tower Hamlets Council, Will Tuckley, and his officials for all that they have done. As I said earlier, we have faced unprecedented challenges in Tower Hamlets.
I am heartened by what we have heard today, because we have been able to build a broader consensus across parties in those contributions, focusing on the quiet heroism of local council officials, leaders and councillors. Whichever party they belong to, the pandemic has shown that they have gone beyond the call of duty in protecting people and addressing some of the systemic problems and funding issues that they have all faced to varying degrees. They have got people off the streets, kept our libraries and leisure services open when possible and closed them when needed. As many have said, local authorities not only lack sufficient funds for covid, but have lost income as a result of the pandemic. There is still a shortfall of more than £7 billion. I hope the Government will address that in the announcement tomorrow.
Hon. Members have talked about funding for SEND children, adult social care and the need for longer-term funding, which is crucial for budgeting. Many issues have rightly been raised. What we need, however, is a collective effort, perhaps starting with this group of Members of Parliament, to speak to the Chancellor and the Prime Minister. I know that some hon. Members have closer ties than others. I appeal to all colleagues to use their influence to get the funding that local authorities desperately need, not only to face the crisis and defeat the virus, but to protect our communities.
The hon. Member for Devizes (Danny Kruger) talked about the shortfall of about £30 million in his constituency—he represents a much more affluent seat than mine. Whether they are affluent or poorer areas, we have seen the impacts, so we need to address those issues rapidly.
Motion lapsed (Standing Order No. 10(6)).
Covid-19: Acquired Brain Injury
[Ms Angela Eagle in the Chair]
I beg to move,
That this House has considered acquired brain injury and covid-19.
It is a great delight to serve under your chairmanship, Ms Eagle, as I have never done so before, as far as I can remember. Some have greatness thrust upon them and I have always waited for this moment.
As hon. Members will know, the issue of how brain injury is treated and dealt with in society has been close to my heart for some considerable time. My hon. Friend the Member for Blaydon (Liz Twist) and I have been running the all-party parliamentary group for acquired brain injury for the past few years. It is frustrating that we have not been able to hold as many meetings this year as we would like to, but I am determined that we are going to move forward on this.
Most hon. Members will have had moments when they have visited a Headway group, a local hospital, a local trauma centre, or perhaps one of the day care centres run by their local authority, and met individuals who have had traumatic brain injuries—perhaps people who have suffered carbon monoxide poisoning, or who have had a stroke, or any one of the many different ways in which the brain can be injured. They will know of the great joy that many families feel that somebody’s life has been saved, and of the great sadness that their quality of life is not what they would want it to be.
I praise the Government for setting up the major trauma centres, because in the last few years, despite lots of controversy locally in many parts of the country, those centres have undoubtedly saved many lives. Probably in the region of 800 to 900 lives are saved every year because of those centres. However, many of those people come out with brain injuries, and the pain for the individual and the family surrounding them can be phenomenal.
I want to say up front to the Minister the things that I want out of this, just to be absolutely clear. I want a national neurorehabilitation strategy, because there is not one at the moment—there are lots of bits and pieces of strategies, but no national neurorehabilitation strategy. I want a national neurorehabilitation lead—a single person who is in charge. I have heard rumours that somebody might have been put in charge, but I am not sure, so I hope the Minister will be able to respond to that.
I want a mandatory system, not a casually achieved system, for commissioning neurorehabilitation, particularly within the community. It is far too patchy up and down the country, and I am not even referring to the differences between England, Wales, Scotland and Northern Ireland; even within England, it is far too patchy and insecure. I have a real fear that, after covid, we will not reinstate all the neurorehabilitation services that we had before covid came to these shores. I have a real fear of that, so I want a guarantee from the Government that all those services and more will be reinstated, and that all the posts that have been furloughed, suspended or not appointed throughout this year will be kept and will be restored.
Does my hon. Friend agree that our report, “Time for Change”, which was produced by the APPG with the help of the United Kingdom Acquired Brain Injury Forum, actually demonstrates the importance of neurorehabilitation, both in acute settings and in community-based cases?
My hon. Friend is absolutely right, and I pay tribute to her for the work that she has done on this issue in lots of different debates, particularly on the relationship between neurorehabilitation and education. It is about the individual in the acute setting, perhaps after a traumatic brain injury in a car crash or something like that, and then it is about that person being given enough neurorehabilitation so that they do not need an enormous care package when they go out into the community, but it is also making sure that there is enough ongoing neurorehabilitation in the community so that they do not fall back on requiring even more of a care package—not because I want to deny care packages, but because I want people to live independently and have the freedom that we would all want for every individual.
I will add two other things that I really want. I am sorry that I am sounding like a popular beat combo from a previous generation—my husband will be proud of me. Neurorehab should be one of the 12 specialities protected during covid. I have made a similar argument about cancer, and cancer has quite rightly had lots of coverage in the country. I hope that very soon we will see the cancer recovery plan, which we have been awaiting for some time, but we also need one for neurorehabilitation. I will come to some of the reasons for that.
The final thing that I really want is a coherent, consistent and tidy arrangement of community neurorehabilitation across the whole country, so that whether someone is in Wells, in Winchester or in the middle of Manchester, they and their family or loved ones have the same right to access ongoing community rehabilitation. Otherwise, it just seems terribly unfair. One of the things that so many families have said to me time and again is that they feel as if they are pushed from pillar to post. They hear a story of somebody getting rehabilitation sorted in one part of the country, and then they find that it is simply not available in their part.
I therefore reiterate that I really want a single coherent approach towards brain injury, and not just in neurorehabilitation—although, as I said earlier, we also need a national neurorehabilitation strategy. We also have to bring together all the different elements. I have spoken to the Minister for the Cabinet Office, the right hon. Member for Surrey Heath (Michael Gove), about the need to bring together all the different departmental Ministers into a single committee to look at the interaction between the work of the Department for Work and Pensions, the Ministry of Defence—it deals with many veterans who have had brain injuries during active service—the Departments for Education and for Health and Social Care, the Treasury, the Ministry of Housing, Communities and Local Government, because it looks at the provision in local communities, and, for that matter, the Department for Digital, Culture, Media and Sport. One of the most depressing and upsetting things this year has been hearing the family of Bobby Charlton say that they reckon that the dementia from which he suffers is a result of his experience playing football, and particularly heading the ball. I am not an England supporter, being a Welshman, but how depressing is it that so many of the players in the 1966 team have subsequently been found to have had dementia, depression and anxiety, which were almost certainly related to their playing of football? We put these people on a pedestal, but we are not prepared to protect them. I am still extremely critical of the way the Football Association has behaved around this.
The problem this year, in particular, is that during the first lockdown, a lot of people with brain injuries were discharged early. I understand why it happened, because hospitals had to make beds available for people with covid, but lots of units were closed in the east of England and in the midlands, which are the two areas that have done the most research into this. Between 50% and 100% of the beds that are normally allocated for neurorehabilitation were closed down and simply not available, and people were very swiftly discharged into their community.
The Chartered Society of Physiotherapy has found that 80% of NHS services in this field have not yet resumed—80%. The number of people acquiring brain injuries during this time, in all the different ways that I have mentioned, has not slowed down; if anything, it has sped up. We have always said in our all-party parliamentary group that brain injury is a hidden epidemic. The person standing in front of us in a queue may be slurring their words and we might think that they are doing so because they have been drinking, but it may be because they have a brain injury. Of course, it is not written on their forehead. Lots of the problems associated with brain injury are not visible, so it is all the more important that we dig down into these issues.
The waiting list for community neurorehabilitation is now four to six months. That is a phenomenal length of time for families to be providing care, particularly when covid means that they sometimes cannot even visit the person concerned. There are major comorbidity questions as well. Patients have been discharged into adult social care with no neurorehabilitation at all. We now know that covid itself is causing neurocognitive problems for many people—not just people with long covid, but those with other symptoms as well. I guess that as covid develops and we get more understanding of the disease—and, incidentally, as we are able to treat more people and keep them alive—it is likely that there will be more, not fewer, people who need neurorehabilitation.
Absolutely. This is one of the difficulties in this field. We have worked with the United Kingdom Acquired Brain Injury Forum, and Chloe Hayward is wonderful. Headway is also a wonderful organisation, although like many charities in this field, it is having a really difficult time this year. Despite that, the truth is that because there are many different routes to a brain injury, it does not always acquire the same currency as cancer or other medical conditions, and yet it affects at least 1.4 million people in the United Kingdom. That is one of the things we need to tackle.
Specialist early supported discharge and community neurorehabilitation teams were redeployed in large numbers during the first lockdown earlier this year, and many were furloughed. In some cases, they have still not been brought back, and in lots of parts of the country there simply are no services available in this situation. What happens is that the person with the acute condition—the acute set of problems—is not treated but sent out of hospital, because the bed is needed in this second lockdown. That person is sent directly into adult social care, with a phenomenally expensive care package. I am not against the expensive care package—that is what we have to provide—but the point is that neurorehabilitation would be far more cost-effective; there would be far better outcomes for the individual patient; and it would be far more sensible for Government if we could get the system sorted out. In the second lockdown—who knows whether we are having a third lockdown, or a tier situation, or whatever it is?—the truth is that lots of neuro patients are being discharged early. That is just a fact, and I think that it will give us a long problem, not only for the individuals and their families but in lots of local authorities and community services.
What am I talking about here? What is the real issue? I will end in a moment, Ms Eagle. As I have said, brain injury comes in many forms. Young brains are often particularly affected. Kids under the age of five from poorer families are four times more likely to have a significant brain injury—as are teenage kids from poorer backgrounds—than those from wealthier backgrounds. There is a knock-on implication for the Ministry of Justice, and so on. Sometimes it is the executive function that is affected, so people may find it difficult to inhibit some of their immediate instincts. Sometimes it is memory that does not work, or it may be language or elements of personality. For some people, the issue is phenomenal fatigue—not just the kind of thing where someone had a big night out the night before and cannot really be bothered to come into a Westminster Hall debate, but a real fatigue that brings people to the point of absolute despair and an inability to feel like living. For many children in particular, sometimes nine or 12 months after the event, there is neurocognitive stall—basically, the brain seems to go on strike and refuse to work as anybody would want it to.
The thing is that neurorehabilitation works. I do not mean just any old rehabilitation; I mean neurorehabilitation, which uses specialist staff who deal with these issues all the time and know about how the brain and the mind work together and how people can be rehabilitated. That works when it is there from the beginning, when it is available consistently for a sustained period and when the connections between acute and community services are absolutely clear. When it works at its best, it is such a joy, because we see kids who were completely dependent on their parents, and on a whole team of people from social services, suddenly able to smile again and able to discover their own freedom and ability to get on with their lives independently of others. We see older people who are able to regain many of the physical and mental skills that they had before, and to regain some of their personality. That is such a beautiful and rewarding thing to behold, and it is why I hope that the Minister will be able to give me everything that I want.
It is a pleasure to serve under your chairmanship, Ms Eagle. I congratulate the hon. Member for Rhondda (Chris Bryant) and thank him for securing a debate on this important matter. I give him so much credit and pay tribute to his passion and his huge knowledge of this subject—I know that he has debated it at length with other Ministers—which he has brought to this debate and other debates on the matter. I also pay tribute to his commitment to this cause and the tireless work that he does. Of course, I know that he speaks on this subject from direct personal experience. I pay a huge tribute to him for all that he brings to these debates.
It is also good to have the hon. Member for Blaydon (Liz Twist) here. I thank her for the work she is doing with the APPG and the hon. Member for Rhondda to campaign for those with acquired brain injury.
I recognise the vital work of charitable organisations such as Headway, the United Kingdom Acquired Brain Injury Forum and the Disabilities Trust. Their work is invaluable not only in raising awareness but in providing hands-on help and support to patients, families and carers. I am aware that acquired brain injury affects not only an individual’s health but their family, work, relationships and education, in the case of children, so it has a huge impact on people’s lives.
I have met people with brain injuries. Shortly after I was elected, I visited Kent and Canterbury Hospital, which has a neurorehabilitation unit, and I spoke to staff and patients and saw the really impressive work that they were doing. I appreciate the points that the hon. Gentleman makes about the importance of effective neurorehabilitation.
As the hon. Gentleman set out, the pandemic has had a real impact on the care and treatment of people with acquired brain injuries. As he said, staff have been redeployed on to frontline covid work, and that has affected people’s care. For instance, some consultations have been moved online, and services are not what we would want them to be. Face-to-face neurology rehabilitation services are being restarted as quickly as possible. Guidance has gone out from NHS England and NHS Improvement and the Association of British Neurologists, and every effort is being made to catch up on delayed care. I will look into the point that the hon. Gentleman made about his concern that services are not yet up and running. I recognise that the pandemic has been a really difficult time for those affected by ABI across a range of areas, not simply access to healthcare services.
This debate and previous debates owe a debt to the all-party parliamentary group and the hon. Gentleman’s leadership. I want to flag the wide-ranging inquiry into the causes, impact and treatment of ABI, culminating in the report published in October 2018, which set out a host of things that we need to address across Government. As he knows, my Department worked with officials across Whitehall to give a response in February 2019. I welcome the fact that the APPG, along with UKABIF, continues to drive the “Time for Change” agenda, most recently in an online summit held on 16 November.
One of the key issues highlighted in the report, as the hon. Gentleman said, is the importance of better Government co-ordination. I absolutely take his point. He mentioned a conversation with the Chancellor of the Duchy of Lancaster. I speak directly for Health, but I am very aware that brain injury cuts across almost all aspects of an individual’s life, from education to work and welfare, and sadly sometimes the justice system, so we need to work on this across Government. I will work with my officials to drive stronger co-ordination for ABI across Government.
On the services available to patients with ABI, the hon. Gentleman will know that since 2012 we have had 22 regional trauma networks across England, and those major trauma centres can provide the specialist care needed by patients with major trauma, including brain injury. Alongside that, timely and appropriate neurorehabilitation is a critical part of care. As the hon. Gentleman set out, that is absolutely crucial for improving the outcomes for people with brain injury. For patients with the most complex need, NHS England commissions specialised rehabilitation services nationally. Trauma unit teams then work to assess and develop a rehabilitation prescription for brain injured patients. RPs are rightly regarded as very important for rehabilitation, as they reflect an assessment of the needs of the patient in the round. That approach is showing results. As the hon. Gentleman knows, the latest data shows that 94% of patients accessing specialist rehabilitation have evidence of functional improvement.
The hon. Gentleman spoke about local commissioning and the differences across the country. The majority of rehabilitation is commissioned locally. To support that, NHS England has produced guidance setting out what good rehabilitation looks like and what services people should expect. Community services clearly play a crucial role.
I am grateful for the nice comments that the Minister has made, but one of the problems with the guidance is that it does not feel very enforceable, and until the money goes with the guidance, as it were, I think it is unlikely that people will invest in this. It feels sometimes—not to use a cliché—a bit too Cinderella-like. I just wonder whether there is a means of twisting it into enforceability.
I absolutely take the hon. Gentleman’s point, and I have heard the argument made about the service we are discussing and other services that are commissioned locally. There is the holy grail—people want a locally responsive health service to respond to what the community needs, but on the other hand they want consistency. Achieving both of those is hard and, arguably, not entirely possible, because the mere fact of having something locally responsive will involve some variation. However, I will also take away the hon. Gentleman’s point that there are ways to try to achieve a higher overall standard and more consistency without necessarily going all the way and saying that it must be done in exactly that way everywhere. Oversight is one way of doing that, so I shall see whether there is further we can go with regard to the point that he made.
I want to pick up on the list of questions—or the wish list, as we are approaching Christmas—
In that case, demands: I shall see which of them I can answer. One was about a national neurorehabilitation lead. During the period of covid-19 there is indeed a national lead. Suzanne Rastrick has been designated the national clinical director for rehabilitation, co-ordinating clinical advice and leadership in that area. That is for the period of covid. I appreciate that the hon. Gentleman’s demand is that it should go beyond the period of the covid pandemic.
As to whether all neurorehabilitation services will be restored after covid, I have no reason to believe that they will not, but I shall, again, take the matter away, and make sure that we see that happening. The hon. Gentleman asked whether neurorehabilitation is one of the 12 specialties that are protected during covid, and I can broadly answer yes. NHS England has made a specific provision for a subset of services, to ensure that they are protected, and complex rehabilitation services are included in that. I hope that answers the hon. Gentleman, at least on that issue. I shall look at his ask on a national neurorehabilitation strategy and consider whether it is something we can do. It is a clear request.
I am grateful. I fully get that one of the dangers of having a postcode lottery is that trying to overturn it can mean ending up with no freedom locally, and all the rest of it; but I just say again that the Chancellor of the Duchy of Lancaster really needs to get everyone together. There are real benefits that we could deliver to people, as well as financial savings across the piece.
The hon. Gentleman makes a good point, and I shall, as I say, take that matter away, as the Chancellor of the Duchy of Lancaster has done as well. In conclusion, I take the matter absolutely seriously. Clearly, covid has put huge pressure on the Department, Ministers and the whole health service, but the hon. Gentleman raises a really important point about how seriously we must take the care, treatment and rehabilitation of those with acquired brain injuries. I thank him again for all that he is doing to campaign on it, and for the impact that he has in doing so.
Question put and agreed to.
I remind Members that there have been some changes to normal practice in order to support the new call list system and to ensure that social distancing can be respected. Members should sanitise their microphones using the cleaning materials provided before they use them, and should dispose of the materials as they leave the room. Members are also asked to respect the one-way system around the room. They should speak only from the horseshoe—although it does not look like that will be a problem for our debate today. Members are not expected to remain for wind-ups. There is less expectation for them to stay for the next two speeches once they have spoken. That is to help to manage attendance in the room. Members may wish to stay beyond their speech but should be aware that, in doing so, they might prevent Members in the seats in the Public Gallery from moving to seats in the horseshoe. Again, I do not think that will impinge on our concern this afternoon.
I beg to move,
That this House has considered business and economic opportunities after Huawei’s exclusion from the 5G network.
It is a privilege to serve under your chairmanship, Ms Eagle. I am grateful to the Members present for their interest; I am sure that there will be cross-party support for my objective. I want to use the UK’s excellence in areas of new technology as an opportunity to help to grow the UK economy and to support the Government’s levelling-up agenda across the UK.
Some time has passed since the decision was taken to exclude Huawei from the UK’s 5G network. Governments around the world faced challenges over Huawei’s dominance in this field. Concerns around security contradicted the will or demand to roll out the technology as quickly as possible. A tension between the two was created. We all know the difficult decision that the Government took to exclude Huawei’s influence, and we look forward to the Telecommunications (Security) Bill, which will be presented shortly.
Alternative providers need to be found and developed, and that is an opportunity for the UK to step up in specific areas. As a free marketeer, my instinct is to let the market decide, and that remains true, but with the UK having considerable expertise in the field, the Government can play an active part in setting the direction, creating the parameters and providing the greatest certainty to allow for private investment, particularly in the fields where as a nation we are in a leading position. Announcements on open standards such as Open RAN—radio access network—highlight that the Government understand that, and their focus should be recognised. It will diversify the market, improve resilience and innovation and facilitate the UK to play a leading position in a field recently dominated by the Chinese.
The reach and influence of 5G technology will extend much further than previous generations of communication. Its capacity to carry much larger volumes of data at very high speeds means that our connected lives will be taken to a new plane, from the internet of things to connected vehicles and smart cities, and many more areas that we have not even thought of yet.
There are several fundamental elements needed to achieve that, including a range of areas, such as radio frequency and satellite communications, 5G and base station capabilities, backhaul technologies and cyber-resilient networks among others. I highlight those elements, because I believe the UK already has specific expertise there, which can be developed further, as I will comment on later. All of them come together using compound semiconductors. These very high capacity chips enable more data to be managed effectively.
It was once described to me that if a silicon chip is a country lane, a compound semiconductor is a great big highway. That encapsulates the opportunity and possibilities 5G will create. Interestingly, they also minimise energy consumption and will play a big part in our net zero target. It is with great pleasure that I can say that the world’s first cluster of compound semiconductor technology is in south Wales, developed from companies such as IQE, SPTS Technologies and Newport Wafer Fab. Many others have followed since. All are supported by the Compound Semiconductor Applications Catapult.
I want to pay particular tribute to the work of Dr Andy Sellars from the Catapult, who first sparked my interest in this field when I was the Secretary of State. Government investment has been significant through the Department for Business, Energy and Industrial Strategy, UK Research and Innovation and the Cardiff capital region city deal. It was a privilege to play an active part in supporting the projects and to see Swansea University and Cardiff University research play its part, along with other universities from Bristol to Cambridge and many more. I also had to ensure that the Department for International Trade was also aware of their expertise. It was good to see Andy Sellars in a prominent position at the GREAT Festival of Innovation in Hong Kong, highlighting the possibilities and seeking to attract interest and investment globally. It was an extremely impressive show, as recognised by everyone. It was a privilege to be there to see it in action.
The fundamental elements I have highlighted, however, are also areas where the UK has specific expertise that can be developed with an appropriate framework. The high-speed radiofrequency technology along with satellite communications needed to maximise coverage is one example. The UK’s investment in OneWeb shows that the Government understand the opportunity. There is also a cluster of complementary technology companies in the north east, such as VIPER RF, Diamond Microwave and aXenic. These are all supported by the Satellite Applications Catapult in the region. Elsewhere in the UK, iconicRF has a very strong reputation internationally.
I pay tribute to the Minister for his active interest in this area, which has given a lot of support to the industry and encouraged further investment, but there is more to do. As part of the network improvements, there will be a need to upgrade base stations with the specific need to develop small cell technology. Blu Wireless in Bristol is an example of the UK’s expertise that also benefits from the compound semiconductor cluster that I have already referred to, which also forms part of the western gateway region. Also in the western gateway economic region lies the UK’s strength in cyber-resilience, including Airbus, Thales, GCHQ and Bristol University’s quantum optical network strength, among others.
Another essential element is backhaul, which takes data from the cellular base stations and feeds into the network. The introduction of 5G applications will mean a need to develop from its strength beyond 400 gigabits per second. Filtronic in Durham and Cambridge Broadband Networks are forerunners in this area, too. The final piece of the jigsaw is test and validation. This is critical to guarantee the interoperability between the vital elements that I have already referred to. The world’s leading test and validation company, Spirent, has its headquarters in the UK. It also operates in the United States. Bringing all those together highlights our expertise in discrete areas of 5G apparatus—a technology and infrastructure project for which demand will grow exponentially. We have an opportunity to develop a plan to ensure that those companies and others are well positioned to benefit from that opportunity, but how do we do that?
There are examples of support across Government, such as for the automotive sector, that offer a model of how to engage with the industry to develop the necessary clusters of consortia. For example, the Advanced Propulsion Centre plays a role in facilitating the shift to electric vehicles. Its modest budget has attracted significant private sector investment in the field. In one case, the APC supports a consortium of 13 companies that work with the Compound Semiconductor Applications Catapult in south-east Wales, to which I have already referred, to create the UK semiconductor supply chain to power McLaren’s electric sports car.
On the back of that project, further consortia have been formed with BMW and Mini to benefit from UK technology. In total, the catapult is working on approximately £100 million-worth of projects, 50% of which have been funded by the private sector. I suspect that the private sector proportion will continue to grow because of the cluster of excellence that has been created.
Another model, in a different field, is the ventilator challenge that the Government set up in response to covid-19 to encourage manufacturers to innovate to meet the global shortages of ventilators. A consortia of companies brought together by the High Value Manufacturing Catapult built more than 15,000 ventilators, which represents five years of production, in just three months. That was pulled together in the national interest and would not have happened if the Government had not played a facilitating role.
A third example is the development of energy generation projects, which have received similar support. The certainty that the Government gave to offshore wind energy installation has allowed the UK to dominate the engineering field in that sector. Similarly, the commitment to small modular nuclear reactors is leading to a world-first in the UK that has the potential to be a major export. Again, I pay tribute to the Department for Business, Energy and Industrial Strategy, the DIT and the Wales Office, when I had a personal interest in it, because Wales has a strong presence in the opportunity.
The Minister will be pleased that I am not calling for a new agency or for identical models to be used, but I am asking for the same principles to be applied that were established for electric vehicles, ventilators, offshore wind and SMRs to prompt further investment from the private sector. The Government have a part to play in providing certainty on policy. The Department for Digital, Culture, Media and Sport is playing a significant part, but it also needs to act as a facilitator to bring some of those excellent companies together and to work with BEIS because of the cross-departmental agenda.
I also gently say to the Minister, and other hon. Members, that not all Government Departments are as joined-up as we would like them to be. Sometimes there needs to be an able Minister with a great pedigree who has the opportunity to bring people together, such as the Minister before us. The market potential is significant and would be a welcome boost to many parts of the United Kingdom.
Companies have a part to play too. If I have any criticism of them, it is that they do not shout loud enough about their expertise or their potential. I deliberately stated where most of those companies are based, because their siting is relevant to the Government’s levelling-up agenda. The western gateway that I referred to is sited in some of the most deprived parts of the UK, but there is the excellence in that region to bring together complementary expertise that does not exist anywhere else in the world. Similarly, the north-east has a leading position in radio frequency and satellite technology, as I have highlighted, and we all know about the Government’s ambitions to grow the economy in that part of the country.
The Government’s decision on Huawei could be a pivot to develop our expertise further and to scale up research in manufacturing, which would lead to a major increase in UK components for our 5G network and a huge export market. At the same time, that would remove the security risks that many hon. Members were concerned about. I look forward to the Minister’s response.
It is a pleasure to serve under your chairmanship, Ms Eagle.
In this interconnected world, we are all utterly reliant on telecom services and digital infrastructure. It not only ensures that we can communicate with one another; it allows businesses to operate and provides people with new ways to socially interact—increasingly crucial during this pandemic and subsequent lockdowns.
There are no absolutes in cyber-security; it is not a binary subject. We can never envisage an entirely secure system. During the covid-19 pandemic, cyber and digital security have become ever more important. There is a growing mountain of evidence that hostile actors have used the pandemic as an opportunity to carry out malicious cyber-activity. The pandemic has revealed the importance of ensuring that our digital infrastructure and telecoms services are as secure as possible.
It is precisely for this reason that I strongly commend Her Majesty’s Government’s decision to remove Huawei entirely from the UK’s 5G network by the end of 2027. The Foreign Secretary has already outlined concerns with Chinese involvement in our networks and that China is worryingly engaged in pernicious cyber-attacks against our commercial, academic and—even during this pandemic—medical institutions.
China, or more precisely the Chinese Communist party, is irrefutably a threat to our cyber infrastructure. Huawei is, in effect, a state-owned structure under the control of the Chinese Communist party. The company’s trade union committee is registered with and pays dues to the Shenzhen Federation, an all-China federation of trade unions, which in turn is controlled by the CCP.
Through a combination of a prolonged poverty of western strategic thinking and Chinese Communist party subsidies, intellectual property theft and entering low-income markets with low-cost products, Huawei has become a market leader in 5G. To some, Huawei’s exclusion may well be seen as a risk. However, in reality, it provides the United Kingdom with numerous opportunities—and benefits—to build a safe and secure 5G network.
As stated, Huawei, like every major Chinese firm, is not truly independent of the Chinese state. The very real risk of this is the Chinese Communist party utilising Huawei’s infrastructure to access, spy upon, disrupt and even sabotage critical UK interests via our communications, which would undermine the security of our allies and ourselves.
Secondly, the strength and durability of Huawei’s systems are questionable. While Huawei has gained success with low-cost products, its ability to withstand cyber-attacks is questionable. The BBC’s security correspondent, Gordon Corera, reported that UK security services have been highly critical of the company’s engineering standards. The UK must seize this opportunity and pave its own path in developing and maintaining its 5G network with minimal interference from Huawei and its communist overlords.
The benefits of using British cyber and telecommunications companies should not be underestimated, boosting the success of our firms and simultaneously providing a strong foundation for our digital economy. Naturally, this does not only have to include British firms. Companies such as Japan’s NEC Corporation or South Korea’s Samsung could also be brought in to assist in creating the UK’s 5G network. Our close trading relationship with Japan and the signing of the UK-Japan free trade deal only weeks ago mean that such partnerships would make commercial, political and economic sense. While Huawei does present a cheap and quick option to create a 5G network in the UK, it would forever be compromised by the Chinese Communist party while, additionally, further denying opportunities for UK businesses and wider economy. The economic, commercial and political case for Huawei’s exclusion is overwhelming.
It is a pleasure to serve under your chairmanship, Ms Eagle. It is important to congratulate the right hon. Member for Vale of Glamorgan (Alun Cairns) on bringing forward this debate. It is clearly a matter that he knows a significant amount about, and he spoke incredibly passionately, particularly about what could be achieved in and around Wales and the north-east. In silicon chips and, I think, semiconductors, he used turns of phrase that I had not heard before. He certainly educated me in that regard, which I will definitely take away from this debate, if nothing else. I am sure that my dad, an engineer, will be delighted about that. He spent many years trying to educate me on these things when I was younger, to no success whatsoever. The hon. Member for Wakefield (Imran Ahmad Khan) raised some incredibly important matters, which I will come to in due course.
First, on interconnectivity, we have all been particularly reliant on the ability to contact people virtually during the pandemic, and a great deal of this House at this moment in time operates virtually, albeit not enough. This has shown us the reliance that we now have on technology. We should be willing to embrace the further betterment of technology, be that with 5G or otherwise, to improve all our standards of living.
I was quite surprised by the number of people here to talk about Huawei, because it is usually a matter that garners much attention, particularly in the Chamber, but there we are none the less. The points raised were incredibly important. The best way to sum them up is the fact that it was a particularly sorry episode for the Government. The to-ing and fro-ing that took place was not necessary, particularly when we were all aware that Huawei was deemed to be a high-risk vendor. I am sure that, if the Government had their time back, they would probably do things differently. That is one of the pitfalls of government, I suppose. I see a wry smile on the Minister’s face.
Obviously, the debate relates to the potential of 5G, particularly for business. That potential is enormous, be that for health, transport or climate change. We are not talking only about better connectivity on our mobile phones, as some may believe. I will briefly reflect on climate change. There are two sides to that debate. There are those who believe that 5G working in the manner in which it should will ultimately increase energy usage, because we will do more and see more much more quickly. On the contrary, we can also seek to combat climate change by doing things in a more efficient and effective manner, a goal that we all must aim for, particularly when looking at 5G moving forward and how we can tie that into the climate change challenges that face us in Scotland, the UK or across the globe. That should really be at the heart of most of the things that we seek to do going forward.
Ultimately, when it comes to 5G, telecommunications is a reserved matter. I wish, like all policy matters, that it sat in the remit of the Scottish Parliament. We have not quite reached that stage yet—“yet” being the operative word—but we will get there. [Interruption.] I hear some sniggering at the back, but we will get there. However, until that moment, telecommunications is reserved, and from Scotland’s perspective we are very much at the behest of the UK Government and the avenues that they seek to go down.
As the UK Government progress with this matter, it is incredibly important that we take into account the specific geography of Scotland. As the Minister’s parliamentary private secretary, the hon. Member for Berwickshire, Roxburgh and Selkirk (John Lamont), will be acutely aware, 42% of Scotland does not even have access to 4G. On my way to the Aberdeen airport today, I lost 5G signal on numerous occasions while going round the city—although not when going through the city; I believe that there is some 5G enablement within the city. We need to be mindful of the geographical challenges across the entire UK as we move forward with this matter.
It is important that investment—be it from the Government or the private sector—seeks to benefit everyone and that nobody misses out. Climate change will be key, but those rural communities across Scotland and the rest of the United Kingdom must also get the connectivity that they so badly deserve. Ultimately, while we need to ensure that nobody misses out, we also need to make sure that security and resilience are at the forefront of everything that we do when it comes to 5G and ensuring better interconnectivity within Scotland and the UK.
It is a great pleasure to be here to serve under your chairship for the first time, Ms Eagle. I thank the right hon. Member for Vale of Glamorgan (Alun Cairns) for securing this really important debate, and it is a pleasure to have the opportunity to talk about such an important subject. I am very grateful to him for that, and for his opening comments: rarely have I heard a speech from the opposing ranks with which I agreed so fully, and almost entirely. I appreciate his comments about the importance of 5G and its opportunities; I also appreciated his reference to Dr Andy Sellars, who is making important advances in this area, and his comments on photonics in the north-east of England. There has always been closeness between the north-east and Wales, and leading in the diversification of the telecoms supply chain would simply be another example of that.
I should also declare an interest: as some Members may know, I worked as a telecoms engineer for 23 years before coming into Parliament, and my very first job was with a telecoms equipment supplier called Nortel—Northern Telecom—who, when I joined it, had just bought one of the last two British telecoms suppliers, that being STC; Marconi stayed around a little bit longer. It is a real shame that having worked for Nortel, and having spent my entire career in telecoms, I never went on to work for a British telecoms supplier. That was a consequence of the industrial strategies pursued under the then Government, Thatcher’s Conservative Government, and under the current Conservative Government, with not enough having been done in the intervening Labour years.
I agree with both the right hon. Member for Vale of Glamorgan and the hon. Member for Wakefield (Imran Ahmad Khan) in their characterisation of the opportunities presented by 5G, which we hope can transform and bring broadband to every corner of our country—which is so much lacking now—and allow us to have real on-the-go mobile broadband, together with the opportunities presented by the internet of things and the vast increase in connected devices that we will see. That is why it is such a shame that the Government find themselves in such a 5G mess. I understand that they are happy to pass the cost of their mistakes, indecision and poor planning on to the operators, stating, for example, that the costs of removing Huawei are
“commercial decisions that are for the mobile operators to make”—
costs that the sector worries could top £7 billion and cause delays of up to three years to 5G roll-out, harming growth and innovation. We should not accept such a delay, which harms UK productivity and sends a message to innovators that they should look elsewhere. Can the Minister confirm that there will be no delay to the target of rolling out 5G to the majority of the country by 2027?
The right hon. Member for Vale of Glamorgan and the hon. Member for Wakefield were right to emphasise the opportunities of an effective diversification strategy. I have put many questions to the Minister on this point, and he has confirmed that the Government plan to prioritise open source and Open RAN technologies, which the right hon. Member mentioned, as part of their plan to build market resilience. However, we still lack any clear strategy for the diversification of our telecoms infrastructure. Yes, we have the names of those on the telecoms taskforce, but no telecoms systems developers are among them. The Minister said that was because the focus was on cyber-security; I should say that while we are taking steps to hopefully secure our network, we need a network that is innovative, effective and resilient as well as secure. The absence of any telecoms systems developers on the telecoms taskforce is a real loss, as is the lack of any representation for any organisation or person from north of Bristol. Can the Minister set out how he intends to ensure that we have a truly representative task force, able to make use of the talents and innovation throughout the relevant sectors and throughout the country?
The Telecommunications (Security) Bill was published this afternoon. I have not had time to assess all its clauses in full, but it does not seem to refer to the diversification strategy that we are promised. The official Opposition welcome the measures taken to secure our network, but without the diversification strategy, our network will not be secure because we will be so dependent on perhaps two vendors. We have to have a diversification strategy, not only to ensure the opportunities in different sectors and different parts of our country in terms of economic development, but to make that network secure. Where is the diversification strategy? How can we have a Bill that does one thing, which is to secure the network, that is so dependent on a strategy that does not appear to be mentioned?
I turn to the opportunities in Open RAN defence and international collaboration. I thank the right hon. Member for Vale of Glamorgan for the explanation of Open RAN. The market is estimated to be worth £47 billion by 2026 and the UK can gain a significant amount of that if we build on our existing strengths, such as compound semiconductors, radios and software for disaggregated networks.
The decision to remove Huawei from the network was based on national security, exhibiting one of the many synergies between telecoms and defence, with many UK companies supplying both the telecoms and defence markets. For example, semiconductor fabricators II-VI, a north-east company based in County Durham, or INEX Microtechnology, in Sedgefield, provide critical infrastructure to both the telecoms and defence markets.
We will see immediate action from operators to replace high-risk vendors and a long-term replacement strategy in UK 5G infrastructure, opening doors for businesses. Japanese firms such as NEC, which the hon. Member for Wakefield mentioned, have already agreed to set up a UK telecommunications centre to help provide immediate alternatives to high-risk vendors, providing NEC with a springboard into the European market. This is a good opportunity for many smaller UK firms, but it cannot be a one-off. What is the Government’s strategy to ensure that UK firms can forge strong partnerships with international firms?
It takes investment as well as strategic vision to diversify our supply chain after so many years. I am afraid that both of those seem to be sadly lacking. Will the Minister take the chance to tell us today how much additional funding the Government will provide for telecoms research, development and innovation? At the same time, can he say how much will be going to the north?
We have excellent science-based and technological opportunities to be found. Indeed, in March, as a constructive Opposition, I offered the Minister a five-point plan to help diversify our supply chain. I called for a communications Catapult centre, and for next-generation research and development projects. BT used to have a major lab, developing and looking far ahead at new telecommunications technology. Is the Minister considering something like that? Can he give us more details? I also called for support for standards development, to support interoperability. We have heard nothing about that. He needs to look at non-5G wireless technologies. What is the Minister doing to support those in all the regions of the UK?
The UK has an opportunity to build a highly resilient, secure and diversified 5G network, unlocking opportunities for business and innovation across the country. Further- more, when we think about the next generations—6G and 7G—the UK has the opportunity to lay the foundations to make us a leading telecommunications country once again. Let us remember that we invented both fibre and the web in the UK. I urge the Minister to obtain the political will and set out the plan that ensures our diverse telecoms sector has the confidence and the investment that it needs to grow and to lead the world.
It is a pleasure to serve with you in the Chair, Ms Eagle. I pay tribute to my right hon. Friend the Member for Vale of Glamorgan (Alun Cairns) for securing a debate on a genuinely important topic, which would have perhaps attracted a significantly bigger crowd on other days—I take that as a sign that the Government are going in the right direction in lots of ways. It is none the less a critical topic for the Government, and it has been my focus for the last few months, to say the least.
I begin by paying tribute to the work of the Catapult and Dr Andy Sellars, already mentioned by my right hon. Friend and others. It is a £43.5 million Government project supported by UKRI, and it is important to say that £12 million from the Welsh Government is an important contribution. Some 1,500 people are already employed as part of the project and, as my right hon. Friend said, we expect thousands more to come as part of that investment. It is as though he read some of my speech, because he mentioned that we are already seeing clusters forming from the clusters. The close collaboration with the private sector in the north-east, Cambridge, Bristol and elsewhere shows that Britain is beginning to take the opportunity by the horns and make the best of it that we can. We do that in collaboration with our other international partners, but ultimately the opportunity is due to a wealth of expertise in this country, as the hon. Member for Newcastle upon Tyne Central (Chi Onwurah) highlighted. That private sector collaboration will only continue to grow.
As my right hon. Friend highlighted, we have plenty more work to do. One of the things that we will seek to do through our diversification strategy is to shape the market and set the direction in a way that works genuinely with our private sector partners, because he is right to say that although there is much that we should leave to the market, we have to work collaboratively in the interests of national security, and we have to do it in way that ensures that we do not repeat the mistakes of the past. Ultimately, we are in the position that we are in with Huawei because of decades of wrong decisions, albeit with the best intentions.
My right hon. Friend also observed that not every Government project is as joined up as it could be. I can tell him that the diversification strategy will be one of the most joined-up Government projects he has yet seen—I do not know where that sets the bar in his expectations.
I am glad that we are having the debate, but I rather wish we were having it at this time tomorrow, because I will be able to say significantly more after the Chancellor has made his statement. To some extent, that will also tie in with the diversification strategy. As the Secretary of State has said, we will publish the diversification strategy alongside the Bill that so many colleagues have referred to. As the hon. Member for Newcastle upon Tyne Central knows, we have published the Bill today, so she will not have to wait long for her salvation. She mentioned the international angle, the need to put money behind it, the need to focus on standards and the need to focus on a specific institution, if not specifically a lab. In some form or another, those things will all be of great interest to her when she reads the diversification strategy, which she will be able to do in due course.
I appreciate the Minister’s comments and look forward, as always, to the publication of the Bill. Will the diversification strategy have the same legislative structure, content and meaning as the Telecommunications (Security) Bill? Will it have legislative power that is binding on the Government?
It is a crucial complement to the Bill introduced by us today. We will be putting in place all the right incentives to ensure that the requirements being imposed by us through primary and secondary legislation can be met, or even beaten, within the timescale that we will be laying out. We cannot impose requirements on individual companies to make specific procurement decisions through legislation, but we can make sure that they are as secure as they need to be, and that the programme fits in a way that works for the market and for our national security. I know that the hon. Lady will take a close interest in both the primary and the secondary legislation, which will fill in some of that picture.
My right hon. Friend the Member for Vale of Glamorgan was right to imply that while we are now more dependent as we move away from Huawei, we have an opportunity to work both with the existing incumbents—primarily Nokia and Ericsson—and new incumbents. We are already working towards increasing the presence in our markets of those incumbents and, crucially, towards that Open RAN future of interoperability and far greater opportunities for our companies to thrive.
I underline my point that many of the component businesses to which I referred will have the opportunity to work with Ericsson and Nokia, as well as with other leaders in the field that are alternatives to Huawei, so the UK can play a prominent role even if it is not the headline, first-tier organisation.
My right hon. Friend is absolutely right. That is why the Government have been working as fast as they can on the 5G supply chain diversification strategy, which not only meets our short-term needs but prioritises the bold and ambitious approach that, as we both agree, makes it possible for our companies to make the most of their place in a global market, not just the UK. To reiterate what has already been said, that approach is built around supporting incumbents and attracting new suppliers, and also around accelerating the development and adoption of the Open RAN interoperable standards. They are all major opportunities, both nationally and internationally.
As discussed, the decision taken on high-risk vendors means that the UK is more resilient in respect of Nokia and Ericsson, and although 5G is now available in over 90 towns and cities with the support of those two companies, we need to seize the emerging opportunities to grow that number as rapidly as we can. That is why the Government are looking through a series of R&D interventions of the sort that the catapult has been so pivotal in accelerating.
Of course, we also want to bring new suppliers into the UK market. It is worth saying, as the hon. Member for Newcastle upon Tyne Central did, that the presence of the NEC global centre of excellence in the UK is not just an important sign of what is already there, but an important signal of the esteem in which the global supply chain holds the UK’s enthusiasm for adopting 5G.
I will take the opportunity to say that we have no intention whatsoever to delay the 2027 target for the majority of the UK population to be covered by 5G. It is already in 100 towns and cities, and the figure is increasing all the time. I also take the opportunity to point out that the chair of the taskforce mentioned by the hon. Lady, which is expert in both commercial and academic senses, is Lord Livingston of Parkhead. I am sure she knows that Parkhead is a part of Glasgow and is some way north of Bristol, but we are keen to focus on the diversity and expertise of that taskforce. Ultimately, we have prioritised expertise in the taskforce rather than the geographic location. She makes a fair point but, as I say, Glasgow is consistently north of Bristol.
I think we have covered the geography of Glasgow.
We are working to remove the barriers for new market entrants, and the taskforce is a crucial part of that, but our ambition will not stop there. We will be keen to make sure that our global ambitions are a part of the work of both the taskforce and the diversification strategy, and that will persist well beyond the process that we go through with the Telecommunications (Security) Bill and with the diversification strategy.
My right hon. Friend the Member for Vale of Glamorgan noted our existing expertise and mentioned Open RAN, which will be hugely important in future. He will know that Vodafone has already launched a trial in Wales. That is the first, we think, of a significant improvement in the percentage of Open RAN, and we will seek to ensure that that persists. He also mentioned the potential of the low earth orbit satellite and OneWeb. It is important that we are open-minded when it comes to what technologies can be developed both through the Catapult and elsewhere. As the hon. Member for Newcastle upon Tyne Central said, we should not simply look at 5G when it comes to making sure we connect as much of the country as we possibly can.
I will address the comments made on behalf of the Scottish National party. The hon. Member for Aberdeen South (Stephen Flynn) is completely right that when we talk about 5G, it is important not to forget that significant parts of the country need a step change in their connectivity. The shared rural network, a £1 billion partnership between the UK Government and the mobile networks, will see 4G connectivity, particularly in Scotland, accelerate rapidly between now and 2025. That is hugely welcome, as he and others in this Chamber are keenly aware. Scotland is challenging geography to wire up, but it is crucial that we do so as rapidly as we can.
My hon. Friend the Member for Wakefield (Imran Ahmad Khan) was absolutely right to mention the opportunities for us in this project. We should see the next few years as a crucial opportunity to grow a really important UK market. The hon. Member for Newcastle upon Tyne Central said that she had never had the opportunity to work for a major British telecoms company. I say to her that the night is young.
If we get this right, opportunities will come in Britain and elsewhere. All of this will require investment, and the Government will put forward an initial funding package, to be set out in the spending review tomorrow, along with a boost to the Ofcom budget to reflect its enhanced security role under the Bill that we have laid today. The funding package will drive early progress and ensure that our diversification strategy not only bolsters the resilience and security of our digital infrastructure, but creates opportunities for competition, innovation and prosperity in all four nations. It is a huge opportunity that I hope we will be able to seize rapidly over the next few years, not just in 5G but through the UK’s gigabit programme as well.
This country already benefits hugely from the digital economy. This programme and this debate are part of doing that better. They are part of building back better, and I am confident that we will look back and say that we took a decision about Huawei that improved our national security and drove our ability to seize economic opportunities. I thank my right hon. Friend the Member for Vale of Glamorgan for securing the debate.
It is a privilege to have the opportunity to respond to a debate in which everyone has been in agreement. I pay tribute to the Minister and the shadow Minister for the healthy banter between them.
We recognise the real economic opportunity in parts of the UK where there are specific economic challenges. This is a great opportunity for the levelling-up agenda and for making great advances in technology in the UK—in the 5G network in the UK and globally. They come together, and the UK can play a prominent part.
I am also grateful to the hon. Member for Aberdeen South (Stephen Flynn) and my hon. Friend the Member for Wakefield (Imran Ahmad Khan) for their contributions. They recognise the challenges that the Government have faced and the opportunities ahead of us.
We need to move away from the headline, first-tier organisations, because most of the expertise lies in a diversified supply chain. We have named some of the organisations in the supply chain, but there will be many more that we are not aware of, such as start-ups that have broken through in some of these fields. Ministers in DCMS, BEIS and beyond need to play a facilitating role in responding to the latest emerging technology and in creating a framework where companies can come together to further enhance the research and excellence in the field. They must take this opportunity for the UK to play a prominent part not only through its own network, but in the exports sought by those nations around the world that do not have that base level of excellence and research.
Question put and agreed to.
That this House has considered business and economic opportunities after Huawei’s exclusion from the 5G network.