Westminster Hall

 Westminster Hall

Tuesday 3 November 2009

[Robert Key in the Chair]

Affordable Housing (Rural Areas)

Motion made, and Question proposed, That the sitting be now adjourned.—(Kerry McCarthy.)

09:30:00

Tim Farron (Westmorland and Lonsdale) (LD)
It is a pleasure to serve under your chairmanship, Mr. Key. I am extremely grateful for the opportunity to debate affordable housing in rural areas. I shall start on a controversial note, and say that I am happy to take on any Member, here or not, in defence of my assertion that Westmorland and Lonsdale is the most attractive constituency in the country.

It is my privilege to represent a vast part of the Lake district, large parts of the Yorkshire dales, and vast swathes of south Cumbria that are so attractive that they could not find a national park for them. I am a fourth-rate fell runner in those lands, and my normal running route takes me to the top of Heversham head. At that vantage point, I often stop to compose myself and take in the view. From there I can see nearly all of my patch. It is stunning. One can completely understand why people who have plenty of brass should choose to join us and move to the area. We are delighted that people should choose to move to our area, to work or to retire, but I put in a bid for today’s debate because of my concern for those who have to move away. They go not out of choice but because they have no choice, and they leave communities much the poorer for their departure.

The average wage in South Lakeland, the district in which my constituency is based, is £19,000 a year. The average house price is just over £250,000. Responsible lenders give mortgages of up to three and a half times annual salary, but the average house price is 13 times the average wage. The average family is stuffed—I apologise, Mr. Key, if that is an unparliamentary word—when it comes to buying a home.

South Lakeland district council has 4,000 council properties and an extra 1,500 housing association homes to call upon. There is a waiting list with 4,000 names on it; it is growing all the time as a result of repossessions and the ever-widening gap between incomes and house prices. At that rate, most people on the list will never find a social rented property. I said that there were 4,000 council homes; once upon a time we had 13,000 in the South Lakeland area, but some clever so-and-so decided to sell them off without replacement. Council houses built for local families are now on the market for as much as £400,000. It is depressing, dare I say it, that we are 12 and a half years into—and very likely six months from the end of—a Labour Government, but have seen no action to undo the outrageous ideological assault made on rural communities by the last Conservative Government.

The lack of affordable housing exists nationwide, in urban as well as in rural areas, but the problems that affect rural Britain are acute, and they require action specific to the needs of rural communities. The National Housing Federation reported in July that residents in rural areas faced the prospect of waiting more than a lifetime for new affordable homes. The report stated that rural housing waiting lists had hit a record level of 750,000. However, the rate at which new affordable homes are being built means that families in the 10 most challenged local authorities would have to wait an average of 90 years before getting a home, and in one case a staggering 280 years. That figure, of course, is academic, but it is none the less depressing.

For people like me who live in and have the privilege of representing part of rural Britain, it is clear that Government policy largely fails to address its specific needs and challenges. Hon. Members will, I am sure, be familiar with the Rural Coalition, which represents non-partisan groups such as the Campaign to Protect Rural England and the Country Land and Business Association. The Rural Coalition states:

“For 50 years or more, policy has undervalued the countryside and failed to meet the needs of rural communities...the result is starkly apparent. Rural communities have slowly but relentlessly become less and less sustainable and less and less self-sufficient.”

I agree with that statement. As the Rural Coalition says, that is not just the result of the present Government’s failure; it is a failure of government across the board over half a century. It falls to us to reverse that.

I return to South Lakeland’s housing waiting list, which is 4,000 strong. Where do 4,000 families go while waiting for affordable homes? Well, they live in often overcrowded and inappropriate private rented accommodation. I was recently in Kendal knocking on doors and I came across a household of eight people—three families—squeezed into a two-and-a-half bedroom house. We have a hostel in Kendal that is clean and well run. It was built to provide temporary accommodation for young single people. Today, it is crammed to the gills with families, who are there indefinitely. It is heartbreaking.

Many of those 4,000 families simply disappear, especially the young ones, and the community loses its lifeblood as a result. What is more, the housing waiting list is just the tip of the iceberg; countless more families never apply to get on the list because they do not see the point. As a result of the affordable housing crisis, we in south Cumbria lose 30 per cent. of our young people each year, and they do not come back. The average age in Britain is 39, but in South Lakeland it is 50. That evidence shows that the community is losing its youth because it cannot house it.

The social rented option is the quickest and most reliable way of providing affordable homes, but it is not the only way. The council in South Lakeland has led the way by enabling the building of shared ownership and shared equity properties, and other affordable homes for purchase. However, as the recession bites, the very people for whom those homes were built are being excluded.

The village of Holme in my constituency recently gained a new development, yet several of the affordable homes built there stand empty because the banks, including those that the taxpayer now owns, refuse to give mortgages on properties with an affordability restriction on them. Those banks that will do so demand a minimum 30 per cent. deposit. If people could afford a 30 per cent. deposit, they would not be in the market for an affordable home. My first request is this: will the Minister agree to ask the Chancellor to instruct the taxpayer-owned banks to lend responsibly, to ensure that people seeking to buy affordable homes are given the same mortgage deal as any other buyer?

I juxtapose the 4,000 families on the waiting list with the 6,000 or 7,000 properties in my constituency that lie empty for most of the year. I am talking, of course, about the real problem of excessive second home ownership in rural areas. I am not talking about holiday lets that add real value to the local tourism economy, but about properties that just lie empty for most of the year. I was in Chapel Stile in the Langdale valley the other day. The last time that a property in that village was bought by someone who actually chose to live there was 20 years ago. Every property bought since the 1980s was purchased as an investment, or a bolt hole. Meanwhile, local families look on in despair. Where are they meant to go? In Coniston, 50 per cent. of properties are second homes. In Dent, the figure is 50 per cent., and in Troutbeck it is about 60 per cent. In the Langdales it is around 70 per cent.

Mark Williams (Ceredigion) (LD)
Does my hon. Friend accept that the knock-on effect is that such communities—I empathise with them; my constituency has similar problems—become seasonal service providers? As a result, the banks shut, the post offices shut and many stores and other shops shut, which means a worse quality of life for those who are able to stay in those communities.

Tim Farron
My hon. Friend is absolutely right. I shall refer to the problem in a moment. Many of the rural communities that I represent—like those represented by my hon. Friend—are seasonal communities when it comes to the provision of services. Many permanent residents are older and disconnected from services. In one village—I shall not name it today—the closure of the post office, which was the last all-year-round service in that community, effectively meant that half a dozen older individuals whom I can think of ceased to be able to live independently. They then needed a care package, and have had to move out of the village over the past year or two, because there is no longer the infrastructure needed to look after them throughout the year. The cost of that to the taxpayer—unseen, of course—is much greater than the cost of ensuring that proper services remain available.

It is an outrageous tragedy that local families should be forced out of the community in which they grew up simply because the two-up, two-down cottage in the village is sold for an inflated price to a Mancunian barrister, a London banker or, as happened on one recent occasion, a Government Minister. It is not that I have anything against such people, but when someone’s right to a second home compromises someone else’s right to buy a first, I know on whose side I am.

As my hon. Friend mentioned, the impact of excessive second home ownership on the community as a whole is immense. Every community can absorb a few second homes, but beyond a certain level, the very sustainability of the community is threatened. In the village of Satterthwaite in my constituency, more than half the houses are simply not lived in. Demand for the local bus service, the post office and the school sunk to such a low level that all of them were lost. It is now three years since Satterthwaite lost its primary school. The tragic irony is that the old school is being converted into seven affordable homes. If there had been seven affordable homes three years ago, the school would never have closed.

Given the damage that excessive second home ownership does in rural communities, through lost services and inflated house prices, will the Minister consider allowing local authorities to end the council tax subsidy that we pay to second home owners, and consider allowing them to set a higher council tax level for those with second homes in areas where second home ownership has become excessive and detrimental? Will she then allow those local authorities to plough that money into the creation of affordable homes for local people? My local authority has made an excellent start in that area. Members will know that second home owners automatically get a 50 per cent. discount on their council tax, but councils now have the power to reduce that discount to 10 per cent. I should say something positive here: I congratulate the Government on introducing that power some years ago.

In South Lakeland, the council has used the additional funds that that extra 40 per cent. has brought in to provide grants of up to £30,000 a time to encourage farmers and housing associations to get together and convert disused and underused farm buildings into affordable homes. The council has also varied its planning policy to allow such conversions to take place. With Government support, that scheme, which we call “Home on the Farm”, could allow hundreds of families to be housed affordably in rural areas, and would breathe new life into rural communities. Will the Minister agree to back the scheme, so that we can build thousands of affordable homes across rural Britain, in the backyards of people who actively want them there?

On top of the issue of excessive second home ownership, there is the additional problem of properties that are used not rarely, but never. Those empty properties should be brought back into use. Will the Minister strengthen the powers of councils across the country, and provide them with the resources forcibly to bring those houses into use as affordable homes for rent?

In Haverthwaite, 20 homes on a newly developed site are lying empty because the firm of developers collapsed. We should have the power and the resources to bring such properties into public use at once. Will the Minister allow South Lakeland district council to do so? Over the past four years, South Lakeland has put an end to the annual net loss of social rented properties by building new affordable homes. It was a great honour to cut the ribbon around the five new housing association homes in Hawkshead. South Lakeland council has already met its housing target for 2012 and is now going on to meet the needs of some of the 4,000 people who are still waiting to be housed. However, most of those developments have happened despite Government policy, and not because of it. As many hon. Members will know, we are forced to go through the processes of the Government’s dictatorial and counter-productive regional spatial strategies, when we should be empowering local communities to build homes with community backing.

In the 1980s, Michael Heseltine referred to planning as DADA—decide, announce, defend, abandon. The regional spatial strategies are a recipe for more and more DADA. Will the Minister agree to scrap the regional spatial strategies and give the communities the power to create the homes that they need, in the places where they are needed? Do not doubt that we will build the homes that are needed. In South Lakeland, we have proved that we are not nimbys, but imbyps—“in my backyard, please.”

To that end, I applaud the Government’s decision to give a small amount of funding to help the establishment of community land trusts; £500,000 was announced in August. However, given the value that community land trusts can have in freeing up land for the development of affordable housing and in ensuring that local people have control over the allocation of such housing, should the Government not take a more proactive role in making the community land trusts a substantial and regular part of the armoury when it comes to providing affordable homes, rather than allowing them to be the rarities that they are? What about backing organisations such as the Cumbria Rural Housing Trust, which is leading the way in providing advice and support to community land trusts? Such trusts are struggling financially, largely because of the Government’s withdrawal of support for the rural housing enabler scheme. Will the Minister agree to consider ways in which we can strengthen such organisations, as they have done so much to win community support for what might otherwise have been controversial housing schemes? The lack of affordable housing in rural areas is only half the problem; the other half is the lack of well-paid work.

Lembit Öpik (Montgomeryshire) (LD)
I congratulate my hon. Friend on his erudite and insightful speech. Does he agree that the issues that he raises are common to areas such as mid-Wales and Montgomeryshire? On house building, has he investigated the work of certain companies, including J-Ross Developments in my vicinity, which have introduced the impressive concept of modular house building? That means that we can have very high quality and environmentally friendly houses for relatively low prices.

Tim Farron
I do not know the company that my hon. Friend mentions, but I am familiar with modular housing as a concept, and with companies in my area that are trying to push ahead with it. We must look very carefully, particularly in national parks and areas of national or international beauty, at how we can strike a balance between attractive properties and affordable homes. We need to make some compromises. In my constituency in the Lake district and the dales, we are always delighted to have visitors, but how likely are people to visit such communities if those communities are dead? We must find ways of building homes that are affordable to the builder and, therefore, to the buyer.

Lembit Öpik
Just to reassure my hon. Friend, the modular constructions that I have in mind are of high quality, and are attractive, too. Perhaps at some point outside the debate, I can introduce him to those ideas, because they may go some way towards providing a solution to his problem.

Tim Farron
If my hon. Friend has a chance later today, I should like to discuss the matter with him. He is absolutely right. Many of the homes in my constituency have been built affordably. The recent developments in Hawkshead, and the Northern Affordable Homes development in Kirkby Lonsdale, were built affordably but to a very high specification, and they are very attractive homes that will stand the test of time.

I will finish in a moment, Mr. Key, but let me touch on the other side of the problem, which is the need for well-paid work to enable people to live in and sustain their families in rural communities. The Government must look to rural Britain as an engine room of creativity, on many fronts. The right hon. and learned Member for North Warwickshire (Mr. O'Brien), when Minister with responsibility for renewable energy, kindly met me, and representatives of the business community in Cumbria, to discuss our attempts to create a new, green business park for the renewables industry near Kendal. If successful, that would create 900 jobs in south Cumbria. The Government must get behind such schemes and be imaginative about ways in which we can exploit the hydro energy industry.

What better way to boost local economies and provide the homes that rural families are crying out for than to scrap the artificial barriers that prevent the building of new local authority housing, so that councils can respond seamlessly and without delay and bureaucracy to the needs of their communities? The Minister has six months to undo this most appalling hangover of Thatcherism. Will she ensure that her name goes down in history as the one who made that happen?

I started off by mentioning the national parks, which were created by a Labour Government who wanted to preserve the countryside for the benefit of the whole nation and ensure that our most beautiful places were accessible to working people. The problem today is that a combination of Government ignorance of the challenges faced by rural Britain and the continuation of a doggedly free-market, laissez-faire approach to the development and protection of affordable housing has led to a situation in which people on middle and low incomes are being squeezed out of those beautiful places.

I want the countryside to be accessible to all, and it should be home to those on modest incomes, as well as those who are wealthy. I want a countryside with balanced, thriving communities of young and old. We will not achieve that if we continue as we are. As I said, the Government must tackle the problem of affordable housing in urban and rural areas. They must understand that rural areas have significantly different problems, when it comes to providing affordable homes, and that we therefore need significantly different solutions.

09:49:00

Mr. David Drew (Stroud) (Lab/Co-op)
I am delighted to take part in this debate, which is on a subject that seems to be debated regularly. Hopefully, we will make some progress today.

I certainly agree with the analysis of the problem by the hon. Member for Westmorland and Lonsdale (Tim Farron), although I have some slightly different solutions to those that he put forward. Nevertheless, many of the solutions will cross over.

This crisis has been coming for a long time. It is a crisis with three strands. First, in many of the villages in my constituency, there is quite simply no affordable housing—that is the reality. We are not talking about the odd unit; they have all gone. I will go on to say what the repercussions are.

Secondly, on the back of that loss of housing we have lost services. That is a key reason why post offices have closed. Government policy has not helped, but the reality is that few people in rural areas either want to use or can use those facilities. Thirdly, there is a lack of social mix in many of our communities now, which is often underrated. It is a very bad thing, because it feeds into the other two factors and is a consequence of them.

To be fair, if the Government accepted the recent report of the Commission for Rural Communities on the issue, it would be a move in the right direction. I know that we have been here before; reports from the Countryside Agency have laid down clearly what the problems are and have come up with solutions. However, let me start from a slightly different perspective from the hon. Member for Westmorland and Lonsdale; I put this perspective four-square and I hope that the Government are at long last listening. The reality is that we will not solve the problem until the state takes the lead on housing. We need about 300,000 units a year, but obviously, we are barely building half that number at the moment, because of the recession.

The way that we got to that figure of 300,000 units a year is completely misunderstood. Looking at history, particularly the ’60s and ’70s, we can see that it was only ever achieved when the state was leading the housing market. It is a myth to pretend that it is a private enterprise-led initiative. Of course, the market has a part to play, but not the leading part.

The Government need to get real and look at how the state drives the process forward, which it can do in a number of ways. Principally, the Government have to put money in. We are beginning to put in some serious money, although it is a bit little and a bit late. Secondly, it is about finding land and about the nature of the provision. I am a complete supporter of local authority housing. I am not a supporter of bad local authority housing, but the local authority has a role to play in the process, because it is trusted and where it does well, it delivers well.

Where are we with regard to rural areas? One of the great successes of the ’45 Labour Government was that they actually provided housing in our rural communities—in every community, from memory. Everyone got housing. We provided that row of local authority housing; it did not necessarily have to be provided in a row, but the houses are all there. Of course, they are not owned by local authorities any more; they are not even housing association properties. They have all been sold off over time, and the hon. Member for Westmorland and Lonsdale used a very good example when he said that such properties often go for hundreds of thousands of pounds now. That is fine for the people who received the capital benefit, but the next generation have been sold out, because those people can never get into the housing market.

Sir Alan Beith (Berwick-upon-Tweed) (LD)
I reinforce what the hon. Gentleman is saying. Before I came to this place I was a rural district councillor in a local authority where members of all parties were entirely united in the view that their priority was to ensure that there was sufficient affordable housing in each village community. That process continued until central Government started to intervene and did not understand the need that councillors of every party were prepared to meet in their own communities.

Mr. Drew
I thank the right hon. Gentleman for that point; as always, he is right on the button. Let us not fool ourselves—the right to buy in rural areas has been an unmitigated disaster. It has been an unmitigated disaster as a policy overall, because it has completely skewed the housing market and the effect has been generational. The generation that had the ability to buy and sell on has done very well but, of course, that has been at the cost of future generations. At long last, the Government have made it much more difficult for the right to buy to operate. The trouble is that there are so few properties left that it is a fairly irrelevant change in policy.

The hon. Member for Westmorland and Lonsdale is absolutely right; it is no good building houses in the countryside if we do not provide jobs to go alongside them. Again, however, it is a complete myth that there is no work in the countryside. That is what is so annoying. Those of us who live in rural areas know that there is plenty of work there—in the public services, in the care industry and providing the basic core services that we need. There is, of course, also a growing provision and need in rural areas related to crafts industries, because those industries can operate and deliver from anywhere. If we can get broadband to some of our more isolated rural communities, people can work from home.

I hope that the Government, with their new planning policies, recognise that. It is no good having planning policy statements 3 and 7, which look at both housing and sustainable development, if we do not invest in the future of work in the countryside. Of course, that investment is absolutely vital at this stage. I must also say that it would help if we could provide some building jobs in the countryside, because that would of course provide some work. In that regard, we must understand that the big developers will never be able to help us in the countryside. They will only be interested in the larger sites. That is part of the problem. We must disaggregate the way in which the construction industry works.

Lembit Öpik
Regarding employment, I was able to attract a company called Regal Fayre, which is a burger manufacturer, to my area. The problem, however, was that the bank was resistant to lending money to the company. Therefore, does the hon. Gentleman agree that there is an opportunity for a proactive strategy, to get companies that might assume that they should be in an urban environment to invest in a rural environment, with the quality of life, low crime rates and good industrial relations that go with it?

Mr. Drew
Yes. That point is something that binds my argument. It is also something that I would like to ask my hon. Friend the Minister about, because I would be interested to know how the Government are driving forward rural policy, in terms of employment generation and trying to find innovative solutions, not just in housing but in job creation. That is a real challenge for the Government. As I said, it would have been helpful if that thought had occurred to them some years ago.

There are some indications, notwithstanding some of the mistakes that have been made in getting rid of rural housing enablers and in not giving enough support to local communities. In a sense, the boot is on the other foot; even if central Government want to do all these things—provide the resources and look for land—it will be no good if the communities themselves are not willing to take on the challenge. That is something that most of the communities in my constituency are willing to do, but some are not, and there needs to be some parity of treatment in the way that we expect local areas to provide sufficient affordable housing. It is possible through the exceptions policy, but too often, the policy is seen as too difficult. I know that in some cases where we have made provision, usually for housing associations, it is a bit like walking through treacle—it sometimes takes as long as a decade to implement. Again, I challenge my hon. Friend the Minister to find ways to reduce the period of time that it takes from planning to getting the money together—as the hon. Member for Westmorland and Lonsdale said—to deciding on the appropriate housing and then, of course, to getting people into that housing, which is not always easy. The exceptions policy is a good policy, but it is often underused and it is often too difficult to implement.

That brings me to my penultimate point, which is that I totally agree—as people would expect—with what the hon. Gentleman said about community land trusts. However, we should be wary. As the hon. Member for Welwyn Hatfield (Grant Shapps), who is the Conservative Front-Bench spokesman, knows, we have one of the pioneering community land trusts in Stroud, at Cashes Green—I cannot remember if the hon. Gentleman has visited that trust, but he certainly knows about it and he is a supporter of community land trusts. However, delivering on that project is not just like walking through treacle; it is like walking through concrete—it is absolutely devilishly difficult, both in terms of English Partnerships and the Homes and Communities Agency. I will point the finger now; they have failed to deliver on the Cashes Green site. We are still at least a year away from being able to bring together all the different parties so that we can deliver on the project and I just do not know why.

I could argue that I am part of the problem, because I want the whole Cashes Green site to be used. It is a former hospital site and it is ideal for the type of delivery that community land trusts would allow, but I am willing to negotiate. The trouble is that every time I get parties together, we seem to have gone backwards rather than forwards. We have a planning application in place, but there are months and months of drift. Surely, one of the things that the HCA can do is to drive things forward. I want to see a mutually-driven community land trust, which would be pioneering. That is what we should be doing in rural areas; we should be looking for different types of scheme and driving forward different types of solution.

Mr. Roger Williams (Brecon and Radnorshire) (LD)
The hon. Gentleman speaks positively about community land trusts, and rightly so, but my experience is that every time we wish to implement one, we seem to have to reinvent it, with a lot of effort. One thing that the Government or the agencies could do is to derive a model that could be used consistently and persistently.

Mr. Drew
I agree strongly. I thought that there were just two models: the mutual housing model and the equity release model. Someone—I cannot remember who, because I have met so many wild and wonderful people over the years who were supposedly experts in the matter—found 11 or 12 models. I do not know what they are because no one could ever show me, but I was told that there were many different models that were appropriate in different places. That just causes confusion.

I wish that we could get on and examine the two main models. I am not saying that the mutual model will work in every situation, but it is at least worth trying. That is what we have done in the 13 or 14 pilots. My hon. Friend the Minister might want to say where those pilots have got to. Some have delivered, some are still delivering and some—I must say that this is the case with mine—have yet to deliver. We need to get on with it.

Grant Shapps (Welwyn Hatfield) (Con)
I have visited the community land trust project in the hon. Gentleman’s constituency. It is most impressive and could deliver 70 or maybe even 100 homes. Does he agree that following English Partnerships’ insistence on repeating the work already carried out by the community land trust by re-surveying all local residents, at a cost to the public of about £100,000, it could be argued that English Partnerships, now the Homes and Communities Agency, is hindering the project rather than helping it?

Mr. Drew
I agree. As I said, it is like walking through concrete. I thought that having got to the stage where the community knew that the site was going to be developed, it was completely irresponsible and unhelpful to go back and ask them what they wanted to develop it for. That is completely at odds with where we should be.

Community land trusts are important because they are community-led and can provide a solution in rural areas, but we need to get on with it and consider how they can deliver thousands of houses in many different areas, not see them as small projects that grind on. There are other things that we can do as well. I am aware that the Government have moved and are moving, but they need to move a lot further. My last question to my hon. Friend the Minister is this. Of the substantial increase in money for housing, what allocation can we in rural areas expect? We are not asking for a ring fence; we are asking for some notion of what will be allocated to rural areas. Unless we get state pump-priming, the rest is irrelevant.

10:03:00

Mr. Andrew Turner (Isle of Wight) (Con)
I thank the hon. Member for Westmorland and Lonsdale (Tim Farron) for securing the debate and congratulate the hon. Member for Stroud (Mr. Drew) on his common-sense view, which I wish were shared by those on his own Front Bench. This debate gives us the opportunity to discuss one of the most pressing issues in many of our communities. Affordable rural housing and the lack of adequate provision have been addressed before, but with a conspicuous lack of progress.

In 2003, in “Sustainable Communities”, the Government acknowledged that

“The availability of housing, especially social and other affordable housing, is a critical issue in many rural areas”.

In 2006, the Affordable Rural Housing Commission stated that

“to meet the scale of the need in rural communities in all regions, the issue must be addressed in its own right, and with urgency, rather than only after urban needs have been met”.

The 2009 Taylor review on rural economy and affordable housing stated:

“Without change we will simply repeat the mistakes of recent decades…we will fail to stem the trend of smaller villages becoming dormitory settlements of commuters and the retired, ever less affordable for those who work within them.”

Yet report after report has led simply to shortfall after shortfall.

I acknowledge that action has been taken, but too little is still being done too slowly to address the problem. By the Government’s own figures, they have missed the target of 2,800 units for rural housing by 13.7 per cent. for 2009-10. Research by the Countryside Alliance paints an even bleaker picture. Need has been identified for 235,000 new affordable homes, but it is estimated that only 51,000 will be created in 2009-10, representing only 22 per cent. of the number required.

Although I acknowledge that the recession makes it harder to deliver the solution to the problem of affordable rural housing, it also worsens the problem itself. Wages are, on average, £4,600 lower in rural communities, while house prices for first-time buyers are £16,000 higher. Someone earning £17,000 a year might be able—just—to buy a home in 50 per cent. of urban wards, mostly in the north of England, but in only 28 per cent. of rural wards. Such disparities create barriers to opportunity. Local people, particularly the young, are unable to afford rising costs on lower incomes and are forced to move away from villages to find cheaper housing. A family moved from the village of Brook on the Isle of Wight to the capital, Newport, 10 miles away. We may find that affordable housing is moving not simply elsewhere on the island but to the mainland. Such an exodus fragments communities and families.

Those who choose to stay in rural areas and small towns also face problems. Though the rural population is increasing, local population is decreasing and the quality and availability of local services is declining. Some are getting better—Chale, with a population of 500, has a superb shop and post office—but others are getting worse. Roughly 10 post offices have closed in the past few years.

The elderly in rural communities are specifically affected by people moving away. Many elderly people are isolated as younger relatives leave villages and are forced in turn to rely on public services, where before, relatives would have looked after them. Furthermore, they often depend on lower-paid welfare workers who themselves find it difficult to live in the communities where they work. Daily commutes increase environmental costs as people travel from urban homes to rural workplaces.

That is why we must address the issue in the same manner that it affects people. Rather than attempting to provide a specific number of houses nationwide, the Government should treat each locality as a specific case with specific needs. Granting greater planning powers to councils and parishes would be a step towards that.  The powers should grant councils the opportunity to provide more ably for local people, rather than to interact better with national targets as at present.

We find time and time again that targets have not been met. As I have noted, the Government are 13 per cent. below their own target for this year. Revising targets down while house prices go up, as this Government have done, creates a chasm between the desire to get a foot on the housing ladder and the opportunity to do so.

Communities should be at the heart of rural development. Too often, new rural housing is simply deposited in existing communities with little thought for how it will integrate. For example, increasing the amount of hard surfaces in rural areas can increase flood risk. New rural housing should therefore seek to extend and complement communities, not simply exist as an urban appendage of a rural village. Houses must be constructed in proportion both to a village’s need and its capacity to sustain such a need. The need for those measures is accentuated by the influx of more affluent people in rural areas. The movement of people from urban to rural areas reduces the number of homes available to local people who cannot compete with the purchasing power of those who benefit from higher urban wages.

I do not advocate a right for local people to live locally. I believe that local homes should be more available to local people. More must be done to achieve that. Landowners must be encouraged to play a greater role in rural housing. Where necessary, people should be relieved of the burden of having to own the soil under their feet to put a roof over their heads. Housing costs would be lower if landowners could retain the land that properties are constructed on, possibly through a series of tax incentives. If portions of land were effectively free to buyers and sellers, local people would have greater opportunity in the housing market. Such a scheme could be started immediately on new sites that are unsuitable for commercial development.

Finally, reducing VAT on maintenance work for current houses would encourage the re-use of almost 1 million empty properties in the UK. Before any new houses are built, we must free up the ones that are not in use. Such a scheme would have a lower environmental cost than building new homes from scratch.

This issue holds a mirror up to our society. It is not as small as just providing for a need, nor as complex as the problems it creates. Affordable rural housing is at the heart of what we think our society should be: fair and equitable. That should be our starting point and our ultimate destination. If it is, we will be able to see statistics as the lives that they represent and families will be supplied with the homes that they deserve. The opportunity that we have can become a potential fulfilled.

Robert Key (in the Chair)
I will call the Front-Bench spokesmen at 10.30 am.

10:12:00

Mr. Roger Williams (Brecon and Radnorshire) (LD)
I intended not to make a speech this morning, but to attend the debate and perhaps make an intervention. However, I am surprised by the lack of enthusiasm for this subject because it must be a constant theme that representatives of rural areas encounter in their surgeries. I did not think that housing would be a big issue when I was elected, but it has turned out to be one of the most important. I congratulate my hon. Friend the Member for Westmorland and Lonsdale (Tim Farron) on his comprehensive approach to the subject. I will touch on a few of the points he raised.

At the end of the recess, I led a small group that included representatives of the National Housing Federation and the English young farmers clubs to meet the Secretary of State for Environment, Food and Rural Affairs on the issue of affordable rural housing. There were many encouraging comments and many aspirations were expressed. However, the delivery of houses is what is important. Many policies are in place, but they are not matched by a determination to bring them to fruition.

One Department for Environment, Food and Rural Affairs initiative that has proved effective is the position of rural housing enabler, which was established with pilot funding from the Department. Over time, that funding has been transferred to local authorities. Unfortunately, some local authorities have not continued to employ rural housing enablers because of the financial pressures they are under. The hon. Member for Stroud (Mr. Drew) said that making progress on this issue is sometimes like wading through treacle, or even concrete. Rural housing enablers have the time, persistence and energy to do that.

I met the rural housing enabler in my area recently. Some excellent work is being done in the village of Clyro. For example, land that is owned by local authorities and other public bodies is being identified to see if it can be made available to other organisations for the construction of social housing. The rural housing enabler has proved effective in Crickhowell, where a development has been built that is proportional to the size of the town. As is common, parts of the community were not hugely enthusiastic about the development. In the past, housing associations have been given targets for building houses and have built in communities without doing the necessary housing needs assessment. As a result, communities have been left with more houses than they needed and have not benefited.

Many people believe that we cannot achieve a decent level of affordable rural housing without changing the planning system. However, there are examples throughout England of local authorities that have delivered for the people they represent while working within the planning guidelines and policies. One such authority was South Shropshire, which unfortunately no longer exists because it was taken over by Shropshire unitary authority. The work that was done in south Shropshire has been transferred to the whole of Shropshire. The authorities in that area have succeeded in delivering a suitable amount of affordable housing.

A problem with planning is the definition of a sustainable community, which is used to decide whether a community could or should be expanded and developed. Some communities are deemed unsustainable because they do not have a shop, church, chapel, pub or some other facility. Often, they do not have such facilities because they were closed when development was not allowed. That is a chicken and egg situation.

My hon. Friend the Member for Ceredigion (Mark Williams) will raise the issue of obtaining mortgages for properties with local ownership conditions, so I will not trespass on that ground. It is an important issue that banks that are subsidised by taxpayers’ money are not aiding policies to provide rural housing development.

As I have said before, the problem we are debating is one of the key issues in rural areas. If we are a civilised society, we must ensure that we have enough housing for the people we represent. Anybody who solves this problem is worthy of an award with the status of a Nobel prize.

10:18:00

Mark Williams (Ceredigion) (LD)
It is a pleasure to serve under your chairmanship, Mr. Key. I congratulate my hon. Friend the Member for Westmorland and Lonsdale (Tim Farron) on securing this critical debate. This subject is one of the biggest issues in my constituency postbag and at my surgeries.

It is a pleasure to follow the hon. Member for Stroud (Mr. Drew), who spoke about council housing. A large part of Aberystwyth looks as though it is made up of council housing. Many people who come to my surgeries believe in that myth and think that they will soon be able to access council housing. Sadly, half of the Ceredigion housing stock has been sold off. As he said, some villages have a row of six council houses, all of which have been sold off, leaving no provision of council housing in those communities.

As a Welsh MP, much of what can be done in my constituency to assist first-time buyers and to improve the provision of housing is rightly the responsibility of the Welsh Assembly Government. They are trying to secure renewed legislative competence in this area, including the power to suspend the right to buy in areas of acute concern. It is a pity that that provision did not exist somewhat earlier, when we had council housing to protect in that way.

Mr. Andrew Turner
Does the hon. Gentleman accept that although he has referred to problems, there are also successes, such as Nettlestone on the Isle of Wight, where a decision has been taken locally to build houses for people to live in, and I think five or six houses have been built there recently?

Mark Williams
I thank the hon. Gentleman for that intervention. I can trace my ancestry to the Isle of Wight, although not to that particular community. I accept the point that local initiatives need to be taken, and I will come on to that later. I simply wish to make the point that there is also a requirement for council housing and that we have lost a huge amount of that stock.

Like much of rural Wales, Ceredigion has for a long time been one of the least affordable parts of the United Kingdom. According to the most recent figures, the house price to earnings ratio is about 6.4. As I say, there is a chronic lack of social housing and, as of September, 2,594 people were waiting on the council housing list.

After the fall in house prices—some evidence was provided by the Countryside Alliance among others to suggest that the fall was much lower in sparse rural areas—prices are rising again and rental prices remain largely static, as more people choose to rent if they can, rather than attempt to buy. In my constituency, such a situation is compounded by steady migration into the county, which, of course, we welcome, and a burgeoning second home sector, to which my hon. Friend the Member for Westmorland and Lonsdale alluded in relation to his constituency. The problem is also compounded by the success of the two universities in Aberystwyth and Lampeter, which puts huge pressure on the rental sector.

Ultimately, the obvious problem, which has been mentioned, is supply and demand. Until enough houses are built to meet the needs of communities, any measures to assist in making housing more affordable are likely simply to tinker around the edges of the problem. The hon. Gentleman mentioned the English figures on the targets for delivery and the figure of 22 per cent in relation to England. The figure is a little better in Wales, but not much, at 31 per cent. Of course, actual delivery is likely to be significantly lower, given the economic climate in rural areas.

My main concern is, where there is private sector housing as a product of market development, those developments remain at a standstill in many cases because of the difficulty in obtaining mortgage finance. I could literally take the Minister and her Welsh equivalents to scheme after scheme that is at a standstill in my constituency. For example, there are schemes where, out of 10 houses, three are deemed by planning to be affordable and there is a planning requirement for them to be built first, yet both developers and prospective residents tell me that they are being hampered by the inability of prospective purchasers to access mortgages.

For many of my constituents, accessing mortgages is nigh impossible. Yes, we need a banking sector that is more risk averse, but it is frustrating that people who should by rights be benefiting from schemes that local authorities have introduced to make housing more affordable have had a patchy experience. The concern raised by lenders is that such 106 properties have template agreements that ensure that if houses remain on the market for a certain period—perhaps six months—the restrictions are gradually released. However, that is not always suitable, particularly in small rural communities where there is acute need and where restrictions are put in place for good reason. I appreciate the work of the Minister’s Department and the Assembly Government on the development of templates for 106 agreements, but I question the wisdom of the Council of Mortgage Lenders, although it makes the point that those templates are not routinely or consistently used by local authorities.

How much flexibility do those 106 templates afford local authorities and how far does that impinge on local circumstances and specific conditions? Sometimes those conditions necessitate that properties are deemed affordable for perpetuity, and require that there are occupancy controls for key service workers and that sales are restricted on the basis of local incomes. Those are the realities of the need in many of our rural constituencies. The Council of Mortgage Lenders has acknowledged that what it deems to be restrictive clauses lead to what it describes as a “diminished appetite to lend.” That is the reality for a growing number of my constituents, who have come to see me. What discussions has the Minister had to address the matter of the section 106 templates, so that she can ensure her discussions with the banks mirror the needs on the ground?

It is bewildering for many of my constituents that some commercial high street banks are able to offer services in this area when others are not. As my hon. Friend said, it is bewildering because a vast amount of public money has been pumped into the banking system—of course, there has been more on that in the news today. My fear is that many mortgages that could have been agreed if the right situation and arrangements were in place have been lost because of this issue. Without redress, that will continue to happen. Although such experiences represent a minority of cases—the letters I have had from the commercial banks say that it is only 3 or 4 per cent. of cases—the figures are significant for those of us in rural communities. Some banks have a positive record—Lloyds has even helped the local authority in Ceredigion to construct its section 106 agreement—but I am afraid that others, such as Abbey, Northern Rock, Royal Bank of Scotland, HSBC and Nationwide, are not accepting the 106 criteria in my constituency.

Mr. Roger Williams
An example of that in my constituency is in Newbridge-on-Wye, where a development for 12 affordable houses has not gone ahead because the condition that the local authority wanted to put on them meant that no mortgage provider would provide the facilities to purchase them.

Mark Williams
That is precisely the point. The situation is worse than that. There has been a marked lack of communication within the banks, which means we have reached a ludicrous situation where mortgage offers are given to constituents when they have meetings in the high street branch, but when the offer is forwarded on to offices higher up the banking structure, the branch is told that it was not entitled to make such an offer. My hon. Friend makes a good point. I know Newbridge-on-Wye and that the issue is a problem there just as much as it is elsewhere in Ceredigion.

These problems run deep. I am particularly concerned about the implication on service provision in our villages and the effect on young people. Going back to July 2008—things have become markedly worse since then—the Taylor review identified that only 17 per cent. of purchases were made by first-time buyers. This is anecdotal, but a young couple came to see me in 2005 because they had no housing opportunities. She worked as a carer on a low wage and he worked as a part-time employee at our national library in Aberystwyth. If they had stayed in the area, they would have become part of the hidden homeless, living in a spare room in a parent’s house, rather than being able to access accommodation themselves. The couple were forced to leave the locality.

Over 20 years, the proportion of young people in rural areas has fallen from 21 to 15 per cent. It is a sobering thought that without homes and jobs, there is no community left to support local shops, schools and services. It is no coincidence that we are also having a debate in rural areas about the vibrancy of our schools, and that we have had debates about the lack of post offices and the loss of shops and pubs. Such issues are intrinsically interconnected and we need a holistic approach from the Government to deal with them.

10:28:00

Andrew George (St. Ives) (LD)
I am pleased to wind up for the Liberal Democrats. I congratulate my hon. Friend the Member for Westmorland and Lonsdale (Tim Farron) on the manner in which he introduced what is an extremely important debate for much, if not all, of rural Britain, given the pressures on the countryside and the difficulty of finding affordable housing for many local families. I will, of course, have to overlook his contentious opening remarks about the beauty of his constituency, particularly as mine covers west Cornwall and the Isles of Scilly, which everyone knows is far better by comparison.

Although the statistics may vary in different parts of the country, certainly many of those mentioned relate to my part of the world as well, and we could read that across to many other areas. It is important that my hon. Friend’s analysis of the problem concentrated on moving towards solutions, and that the debate has not simply been about raising a series of gripes and criticisms of Government policy—instead, it has concentrated on the way forward.

The hon. Member for Stroud (Mr. Drew) mentioned the usefulness of the exceptions approach and the role of community land trusts, which are developing over time but which have to overcome enormous hurdles to achieve desired outcomes. The hon. Member for Isle of Wight (Mr. Turner) made an important contribution and emphasised the need to devolve greater planning powers to local communities and local authorities. The Government should listen to comments on that theme, to which I shall return.

My hon. Friend the Member for Brecon and Radnorshire (Mr. Williams) made an important and telling contribution. He pointed out that although it is possible to work within the existing planning system, and although some local authorities, such as the former South Shropshire authority, were able to work with the limited tools available to them, there is no room for complacency. The difficulties that local authorities have to overcome to meet local housing need are enormous and, if anything, getting worse.

My hon. Friend the Member for Ceredigion (Mark Williams) emphasised the need for powers to be devolved—to Wales in his case. He also emphasised the important role of the banks and lending institutions in oiling the wheels to help the intermediate market properly take off. Those of us who have taken up casework in our areas and who are trying to assist such developments, particularly those with section 106 obligation agreements attached, have found that the lending institutions have not been particularly helpful.

I should declare an interest. Before I was elected to the House, I was a rural housing enabler before rural housing enablers were invented. I worked with a local charity in Cornwall and the Isles of Scilly, and I was one of the first shareholders in the Cornwall Rural Housing Association, which was established in 1986.

I shall concentrate primarily on two issues, the first of which is the fundamental problem of the dead hand of centralised control and its impact on the ability of local authorities properly to address the need for affordable housing in their areas. Regional spatial strategies have been mentioned by several speakers. The Government’s overall objective of building 3 million homes by 2020 is the totemic objective that drives policy. They simply ignore the need for the more subtle and localised approach that is required in many rural areas as they drive on with their top-down, prescriptive approach, which is inappropriate for rural areas. It is a tragedy for many rural areas that the Government are grinding on with a strategy that has failed successive Governments, who have simply attached housing development numbers to structure plans—now regional spatial strategies—in a manner that does not necessarily address the intricacies of the situation in rural areas.

The Government have confused the means with the end. The end is to meet housing need, and the means to do that is to build 3 million houses by 2020, but that target seems to have become the end of the Government’s policy. They have become so obsessed with building those homes that they fail to recognise why they are building them. Let me give an example from my part of the world, Cornwall, where the housing stock has more than doubled in the past 40 years—indeed, we are the third-fastest growing place in the UK. Like my hon. Friend the Member for Westmorland and Lonsdale, I say that we are not nimbys; we are very much imbys. We have accepted and welcomed development in our fast-growing area, which is densely populated for a rural area. However, at the end of those 40 years of perpetual growth, the housing need situation for local people is worse.

One conclusion that we can draw from that example is that simply building houses is not the answer. People who follow housing policy in rural areas will recognise that being a one-club golfer—simply building more and more houses without recognising and adapting to the intricacies of the situation in rural areas—is part of the problem. I think we all recognise that there is a difference between land values in rural areas—between the value of agricultural land and the value of development land. That is the elephant in the room. The stroke of a pen at a local planning committee can increase the value of an acre of land from £3,000 or £4,000 to the equivalent of a lottery win. We know that the planning system is fuelled by greed rather than need, and that fundamental problem has made it extremely difficult to meet housing need. The need for a policy that meets housing need while retaining the integrity of the planning system and not simply turning it into a developers’ charter is something that local authorities fully understand, and they need to take those considerations on board when they address these issues.

We need to expand the exceptions approach that the hon. Member for Stroud touched on. We also need to expand the intermediate market. Yes, the lending institutions need to be more on board than they are, but we also need to give local authorities the power and tools to address need. We cannot simply get around the problem by building cheap housing. I do not think that my hon. Friend the Member for Montgomeryshire (Lembit Öpik) meant or implied that we were talking about cheap housing for people who are in housing need. As my right hon. Friend the Member for Berwick-upon-Tweed (Sir Alan Beith) said a moment ago, in the past, local authorities knew about meeting local housing need and they built decent houses. What we are doing at the moment is cramming people into unfeasible spaces and creating ghettos for the future. We will regret that approach in years to come.

My second point is about second-home ownership, which has been mentioned by my hon. Friend the Member for Westmorland and Lonsdale and others. The issue is not about the politics of envy. We have achieved the removal of 40 per cent. of the 50 per cent. council tax discount that was costing the taxpayer about £200 million a year. It was clearly morally unacceptable to subsidise the wealthy for their second homes while thousands of rural folk could not afford a first home, so that subsidy had to be done away with. I remember a debate in this Chamber with the hon. Member for Sunderland, South (Mr. Mullin), when he was a Local Government Minister. I had been carrying on about the issue for years, and I told him that all I had heard from the Government were complacent responses, and he said, “Well, I’ve been reading complacent responses for too long,” and put his notes down. We had a little chat afterwards, and the policy changed thereafter. I would like Ministers to take that kind of initiative.

I have undertaken surveys of estate agents in my constituency for many years. The last one I conducted demonstrated that three times as many properties were sold to second-home buyers as to first-time buyers. I am sure that many people will feel that that should be addressed, but before we can address the problems that second-home ownership creates, we must define what it is. The Government have always used the difficulty of defining second-home ownership as an excuse for not addressing the issue. We could use the capital gains tax register or references to form that definition. The recent exposure of MPs’ misuse of the system of electing where their primary residence is demonstrates why that area of tax and tax record needs to be properly tightened. Using the electoral register, the council tax register, the business rate register and local knowledge, I believe it would be possible to define where second homes are. Once we had achieved that, we could bolt other policies on to it, such as tax and planning controls that would allow local authorities to determine whether someone should be allowed to turn a permanent residence into a second home. I hope that the Minister has been listening and that she will pass my comments to her ministerial colleagues, and that we will get some movement on the issue.

10:39:00

Grant Shapps (Welwyn Hatfield) (Con)
I congratulate the hon. Member for Westmorland and Lonsdale (Tim Farron) on securing this excellent debate, which has been of far better quality than some housing debates I have attended in this Chamber. I also congratulate the Minister, whose constituency of Stevenage neighbours my own, on her new role; it is not an easy job because the problems of rural housing, as hon. Members have explained this morning, are enormously complex and acute.

I will not spend too much of the precious time available repeating the figures that have been mentioned this morning, other than to emphasise the extremeness of the position. Six of the 10 least affordable places to live in Britain are in rural areas, the second least affordable being the south-west. There really is an emergency out there, and we have only seen the crisis get worse over the past few years.

If the problem is big, what are the solutions? I was struck by the contribution made by the hon. Member for Stroud (Mr. Drew), who spoke of the need for the Government to get more stuck in and produce more homes. He argued for a more top-down, centralised approach to housing. I did not agree with that part of his speech because it strikes me that such an approach has not worked over the past few years, but I most certainly agreed with his second point about community land trusts, particularly the excellent one in Stroud, which I shall talk about in a moment.

I also acknowledge the excellent speech made by my hon. Friend the Member for Isle of Wight (Mr. Turner), who described in detail the problem of unaffordable housing for the inhabitants of the island, many of whom are forced to move off the island to find somewhere reasonable to live. That problem was reflected in different ways by the hon. Members for Brecon and Radnorshire (Mr. Williams) and for St. Ives (Andrew George).

I turn to some of the solutions. We all agree that community land trusts could provide a large part of the solution, but the problem is that very little is actually happening. Some time ago I met Sir Bob Kerslake, shortly after he had become chief executive of the Homes and Communities Agency, who proudly told me that his ambition was for the HCA to help deliver four community land trusts by the end of this year—only four. I do not know whether it is on track to meet that target and I will be sure to ask him when we meet this afternoon, when I shall also ask whether one of those trusts is in Stroud. It seems to me that the goal is nothing short of pathetic.

The idea of community land trusts has been around for decades. Indeed, I set up a community land trust taskforce last year to try to find out why they had not succeeded, and a contributor to the taskforce explained that he had first stumbled across the idea 30 years ago. It is a mystery why things have taken this long, which the taskforce is unravelling. One of the problems, as the hon. Member for Stroud mentioned, is that even after a collection of people have got together, decided on an idea and gone out to consult the public, other bureaucratic obstacles get in the way. He said that can lead to a 10-year delay, but I can tell him that the village of Essendon in my constituency has been waiting for between 20 and 30 years for a few houses to be redeveloped, even though they are nothing more than asbestos-ridden, post-war bungalows that are falling down and derelict. I went to a village meeting in Essendon to listen to local concerns about housing and assumed that people might talk about the Government’s plan to stuff 10,000 to 15,000 homes nearby, but in fact they wanted to talk about the lack of affordable housing in the village and explain to me how long they had been waiting for something to be done.

Having visited Stroud, Rock in Cornwall and most of the pilot community land trust schemes across the country, we developed the idea of local housing trusts, which would be like community land trusts. Land would be locked in perpetuity for the benefit of the local community, answering local need for affordability. However, there would be one significant difference: a local housing trust would be able to grant itself planning permission to build. During the last few months of this Government, will the Minister give serious consideration to enabling local housing trusts to go out there and do their job?

Having visited places across the country, I am convinced that there would be a large demand once local people are given the direct power to say, “This is our community and we are not prepared to sit back and wait for someone else to ride to our rescue, because we know what needs to happen here”, rather than having to rely on a regional spatial strategy that orders them to place the housing in a particular area or wait for the local authority to sign off on the development of just a dozen houses in a village. The land might come from the parish, the local authority, a benefactor or a landowner, or people might have to buy the land themselves, but because that land would be on an exception site, the only buyer in town would be a local housing trust, so one would expect the houses on it to be built at a reasonable, in-between price.

That is how we can start to solve the affordable housing crisis in our rural communities. It would allow people to reinvigorate the parishes and villages that are suffering from falling populations and finding as a result that the village school cannot stay open, that the post office closed two years ago or that they cannot sustain a GP surgery. Putting people back in control and allowing them to innovate for their own communities is far more likely to achieve a solution than the vast array of quangos set up by the Government.

I invite the Minister, in her response, to take some of those ideas on board. It cannot make sense to have regional spatial strategies with a whole string of quangos under them, such as EEDA, CEDA, ERA, SERA, NERA, DERA and many more besides, none of which has delivered the kind of housing numbers we require, particularly in our rural areas. I invite her not only to match the idea of local housing trusts, with power to grant themselves planning permission, but to match our policy of allowing local areas to keep the council tax. They should keep not only the council tax that is collected at the moment, but 100 per cent of it, pound for pound, matched in addition for every single new home that is built for a period of six years. To ensure that sufficient numbers of affordable homes are built, they should keep 125p for every pound of council tax collected. That is the way to incentivise local communities and ensure that they get something back from regeneration and additional housing. If we put local people in control, trust them and give them the power, tools and incentives, I guarantee that more homes will be built. If the Minister will not do that, we will certainly be happy to.

10:47:00

The Parliamentary Under-Secretary of State for Communities and Local Government (Barbara Follett)
It is a pleasure to serve under your chairmanship, Mr. Key. I congratulate the hon. Member for Westmorland and Lonsdale (Tim Farron) on securing the debate and on giving us an opportunity to air this vitally important subject once again in this Chamber. He obviously belongs to the William Cowper school of thought; like the poet, he believes that man made the town, but God made the country, but he extends that to the assertion that God made his constituency and did not seem to have much of a hand in any of the other 645 in the country. I will not argue about that here, as the hon. Member for Welwyn Hatfield (Grant Shapps) and I both inhabit extremely beautiful constituencies and would be prepared to argue that point outside.

I do not intend to talk much about the vitally important subject of the rural economy, mainly because the debate is about affordable housing, but I know how the two interlock and how important businesses are to rural economies, as my hon. Friend the Member for Stroud (Mr. Drew) mentioned. I know that not only as a constituency MP, but as Minister for the East of England, which has significant rural representation. In that role, I would like to counsel the hon. Members for Welwyn Hatfield, and for Westmorland and Lonsdale, not to discard completely regional spatial strategies, which have their role. The Taylor report rightly pointed out that we need to keep track of the impact of those strategies on rural areas. Indeed, a report on that impact is shortly to be published.

Grant Shapps
With regard to the Minister’s plea to keep regional spatial strategies, is she aware that in both her constituency and mine it is now the RSS that is delaying homes being built?

Barbara Follett
Much as I hate to contradict the hon. Gentleman, I believe that it is the fact that the county of Hertfordshire is taking us to court over the RSS that is delaying homes being built. Also, I fear that the instruction that the hon. Member for Meriden (Mrs. Spelman) has given to Conservative councils—there are many more such councils than Labour or Liberal Democrat ones—to take the Government’s money and not build houses but just lodge planning objections is having a slowing effect on building projects such as the one west of Stevenage. I believe that there have been attempts to build that for 25 years. That kind of conservatism, with a small and a large c, is putting up barriers to many of the things that we are trying to do. Charles Darwin said that it is not the biggest or the smallest species that survive, but the species that are willing to adapt, and I regret that the hon. Gentleman’s party has not learned that lesson yet.

Andrew George
Much as I regret having to intrude in a local spat, I wonder whether I could bring the Minister back to the primary issue, which is the relevance and impact of regional spatial strategies, which several people have mentioned? In particular, I bring her back to the fact that because they represent the dead hand of central control, they do not allow local authorities to show their initiative, to cut deals and to address local housing need.

Barbara Follett
There are two ways of looking at control: as a dead hand or as an enabling hand. I see it as enabling—one just has to know how to work the system well. I would like to make progress, because a vast number of questions were raised, and I am not sure that I shall manage to answer them.

I know that the latest statistics from the Commission for Rural Communities show that, on average, house prices in rural areas are more than seven times higher than household income. I am even more aware that that compares unfavourably with figures for urban areas, where prices are 6.3 times the average household income. For that reason, among many others, rural housing and housing as a whole are high on the Government’s agenda.

We will invest £7.5 billion in housing as a whole, from which one cannot divorce rural housing, in England between 2009 and 2011 to deliver 112,000 new affordable homes. In the past 12 months, we have built 47,000 affordable homes, 2,400 of which were in small, rural communities of fewer than 3,000 people. Given that we were—and still are, to some extent—in the middle of one of the worst recessions in living memory, that is no mean feat.

Grant Shapps
Will the Minister give way?

Barbara Follett
I am sorry, but I have to make progress.

Throughout the recent downturn, we have taken steps to secure housing growth and to support the construction industry. Measures such as the 2009 Budget stimulus package, the housing pledge and the local authority home building programme—yes, indeed, it has started again—commit the Government to invest a further £1.5 billion to build 20,000 more new affordable homes by the end of next year.

The Kickstart programme, which, as its name suggests, aims to get stalled sites building again, is also moving ahead. Indeed, of the 37 approvals in Kickstart round 1, 14 are in rural areas, where schemes for up to 30 units were allowed to bid for funding. By contrast, in urban areas, schemes had to have at least 50 units to be eligible. In addition, as part of the housing pledge, the Government have allocated £7 million to rural authorities to build more than 200 new social rented homes in small settlements across the country.

We know that rural areas face particular challenges, such as a shortage of suitable sites and a lack of infrastructure, which make it more expensive to deliver an affordable home in a rural area than in an urban one. That makes the targets that we set at the beginning of the current spending review period for the delivery of affordable homes in rural areas even more challenging than those set for other areas. [Interruption.] I am about to deal with that.

Sadly, the target of the Housing Corporation—now known as the Homes and Communities Agency—which was originally for 10,300 affordable homes to be delivered in small rural settlements between 2008 and 2011, has had to be reduced to 8,500, thanks to the toughest market conditions in living memory. However—this is important—that target is an ambition, not a limit. We hope that we can secure more new affordable dwellings through Kickstart and local authority new-build programmes.

As the hon. Member for St. Ives (Andrew George) said, planning has a major role to play in the delivery of affordable homes in rural areas, and planning policy statement 3, which the Government introduced in 2006, makes local authorities responsible for providing housing that contributes to the creation and maintenance of sustainable communities in market towns and villages. It also gives local authorities some of the power for which hon. Members have been asking. We allow local authorities to set site size thresholds that are below the national minimum, and, where practical, they can grant permission for 100 per cent. affordable housing on small sites that would not normally be released for housing.

Since the rural White Paper of 2000, all Departments have had to rural-proof their policies. In 2007, the hon. Member for Truro and St. Austell (Matthew Taylor) was invited by the Prime Minister to report on

“the application of land use planning to facilitate the provision of land for greater economic and social sustainability within rural communities”.

The hon. Gentleman’s report, entitled “Living Working Countryside”, was published in 2008, and my Department, along with the Department for Environment, Food and Rural Affairs, has published a joint response, which sets out the actions that we will take to implement it. In April, one of those actions resulted in £500,000 going into a three-year project to establish a sustainable community land trust sector, in which independent, not-for-profit organisations own and control land and facilities for the benefit of the community.

We have also done a great deal to allow people to purchase homes under our low-cost home ownership schemes, and here I would like to try to deal swiftly with the access-to-loans issue that hon. Members have raised. It is a real problem, and, as both a Department for Communities and Local Government Minister and a regional Minister, I have meetings with the banks to ensure that those who wish to buy affordable homes can get the credit that they need to do so. We are working with lenders on that, and HomeBuy Direct, Halifax, the Royal Bank of Scotland, Nationwide, Woolwich and HSBC have all agreed to loosen some of their risk-averse practices, but we still have to work hard to get the money flowing again.

Section 106 has proved a real problem, but we shall introduce community infrastructure levies, which are currently out to consultation. We hope that they will be in force in 2010, and that they will be a more efficient and more sustainable means of delivering infrastructure via the developer and the local authority. I wish to end by saying that affordable housing in rural communities is a problem, but one that this Government are doing their best to solve, and I would welcome the co-operation of other parties on the matter.

 Farm Animal Welfare

11:00:00

Mr. Chris Mullin (Sunderland, South) (Lab)
I intend to highlight the importance of public sector food procurement and the role it has to play in improving animal welfare standards for meat and poultry in the United Kingdom and abroad. I will concentrate on one key area of public procurement—eggs—although the argument could equally apply to pork or any one of a number of factory farmed products. I call on the Government to introduce legislation that will prohibit the public sector from buying eggs produced by caged hens and encourage the purchase of eggs produced to higher animal welfare standards, progressing on a sliding scale from barn eggs, to free range to organic, including eggs that are purchased individually as well as those used as ingredients. In doing so, I wish to make a larger point about public sector food procurement, which is that fine words and lofty sentiments are not enough. The Government must take the lead by introducing mandatory health and sustainability standards for all public sector food. I place on the record my thanks to those estimable organisations, Sustain, Compassion in World Farming and the Royal Society for the Prevention of Cruelty to Animals, for the part that they are playing in helping to achieve this goal.

There are four legally recognised categories of eggs: caged, barn, free range and organic. Caged eggs are produced to the lowest standards of animal welfare, from hens in cramped, tiered cages with sloping mesh floors. Each hen has an equivalent living space of 550 sq cm, which is less than an A4 piece of paper. The strength of public opposition to cage-produced eggs resulted in a decision by the European Commission to outlaw the sale of caged eggs by 2012. Barn eggs, free range and organic eggs are reared to considerably higher standards: they come from hens that have access to litter and to the nest site of their choice. They can flap their wings, exercise and explore their environment.

History shows that achieving real improvements in the health and sustainability of public sector food is only possible by introducing mandatory standards. The Government’s success in revolutionising school food was achieved because legislation was passed to introduce mandatory nutritional guidelines monitored by the School Food Trust. Indeed, the problem with public sector food has not gone unnoticed by Government. There has been a rash of activity, which no doubt the Minister will tell us about in a moment, aimed at improving the nutritional value and sustainability of public sector food by voluntary means. Although well-intended, such projects have failed precisely because they were introduced as voluntary initiatives and missed out on the concrete benefits that would have been achieved by introducing mandatory standards.

Millions of pounds of taxpayers’ money has been wasted on such initiatives. The £40 million spent on the better hospital food initiative in 2001, for example, which introduced new menus for hospital food devised by a celebrity chef, did not achieve a step change in the nutritional quality of hospital food. A more integrated attempt to improve public sector food under the six-year public sector food procurement initiative, managed by the Department for Environment, Food and Rural Affairs, which was introduced in 2003 and wound up this year, is another example of good intentions that did not lead to real change—at considerable cost to the taxpayer. An evaluation conducted by Deloitte tactfully concluded that

“take-up of the initiative was limited.”

Both schemes had some short-term successes, but they were expensive and did not achieve long-term change. The moral of the story is clear: voluntary schemes do not work; real change depends on introducing mandatory standards.

David Taylor (North-West Leicestershire) (Lab/Co-op)
My hon. Friend is focusing on egg production, but chicken meat and other areas are just as important. The Minister, who is a decent and able man, may respond by saying that Departments are required to seek best value, from which we infer that they obsess to an extent on price. Does my hon. Friend agree that husbandry, locality and quality should be incorporated within that best-value concept and that that will drive up nutritional standards, as well as the welfare standards in respect of the animal products we use?

Mr. Mullin
Yes, I agree. I will touch on some of those points later.

Dr. Andrew Murrison (Westbury) (Con)
Does the hon. Gentleman agree that price has to be important, because we are talking about public bodies? One reason we have price inflation is because the consumer—the bulk of those purchasing foodstuffs in this country—is unable to differentiate between products that are produced to our own high welfare standards and those that are produced elsewhere to a standard that falls far short of that. Would it not be best if we were able to give consumers proper choice? If that happened, the competitive disadvantage of our own producers would be, to some extent, erased and one would hope that prices would fall as a result, generating a win-win situation for both public sector bodies and animal welfare.

Mr. Mullin
Yes, I am in general agreement with the hon. Gentleman on that. However, price is not the only consideration. I have always believed that we have to take into account the consequences of our actions. As all those hon. Members who have taken an interest in factory farming know, it involves some disgusting practices that many farmers deeply regret; in fact, many farmers feel forced into pursuing such practices by the continuous drive to the bottom that occurs if price is the only factor. The hon. Gentleman is right: there is no point making the reforms here if imports produced in countries that do not observe the same standards are dragged in. We have to bear that in mind.

Procurement standards across the public sector vary widely. Some public sector organisations have made tremendous progress in buying healthier food from sustainable sources. Lancashire county council, for example, must be credited for its decision to go cage-free. The council uses more than 500,000 eggs a year and has changed its supply to free-range eggs for its schools and care homes, which will liberate more than 2,000 hens from battery cages every year. So far, about 40 local authorities, out of a total of 468, have followed Lancashire’s example and committed to going cage-free. Were others to follow suit, it would surely have a powerful impact on the welfare of hens and would help lower costs and prices and would, therefore, encourage the private sector to do likewise.

I am pleased to report that numerous schools, hospitals and universities are also switching. Other taxpayer-funded organisations are going cage-free, including the BBC, the British Library, Transport for London and the House of Commons. However, caged eggs continue to be served across the public sector, in schools, hospitals and care homes. There is a postcode lottery in public sector food procurement. The missing ingredient required to address that is compulsion. I fear that further voluntary initiatives, such as the healthier food mark, will simply use more public funds on ineffective interventions that will achieve neither better quality food, nor healthier consumers.

The public are ready for change. There has been a huge increase in consumer awareness of the appalling animal welfare standards involved in caged egg production and a significant increase in sales of eggs that meet higher welfare standards. Nearly half of all eggs sold in UK supermarkets now come from higher welfare systems. So we have made considerable progress.

Mr. Roger Williams (Brecon and Radnorshire) (LD)
The hon. Gentleman makes an important point about the market driving improvements in animal welfare, with 50 per cent. of eggs sold in supermarkets being free range. Surprisingly, all the eggs served by McDonald’s, for instance, are free range now. That is a testament to the power of the market.

Mr. Mullin
It certainly is because, as we know, McDonald’s is ruthlessly moved by the power of the market, and where it goes the public sector should surely be able to follow.

Last year, concern about the link between intensive farming and the emergence of virulent forms of flu, including swine flu from pigs, has increased pressure on meat and poultry producers to examine the conditions in which their animals are reared. In the poultry industry, the unhealthy and overcrowded conditions endured by intensively farmed chickens may have contributed to the creation of virulent strains of avian flu. Such concerns have, in part, influenced consumer opinion, which has begun to swing resoundingly against caged eggs. Witness the fact that Sainsbury’s, Marks and Spencer, Waitrose and the Co-op have already taken action and banned the sale of caged eggs in their stores. Commercial operators are subject to the whim of their customers, and decreasing demand for eggs reared in caged conditions represents public feeling. A MORI poll in July 2005 showed that a majority of UK consumers believe that cages are cruel and should be outlawed. It is time that the public sector caught up with what has become best practice in a large part of the private sector.

Mr. David Drew (Stroud) (Lab/Co-op)
Does my hon. Friend accept that part of the problem is that the EU has dragged its feet and that, to be fair, the UK Government would have gone further and faster? Limitations must be properly constructed to ensure that third country imports of poor quality produce do not come here. Otherwise, people will be cheated.

Mr. Mullin
I absolutely accept that, and I touched on it in my response to the hon. Member for Westbury (Dr. Murrison). Perhaps I should also have said that consumers are entitled to much better information about where their meat comes from, which requires proper labelling.

It has not been possible to calculate the exact percentage of caged eggs purchased in the public sector, but it is a matter of record that the dreaded race to the bottom in public sector food procurement—where organisations are required to find the cheapest price for food products regardless of other considerations—often results in the purchase of the least healthy and least sustainable food option available. That is no fault of public sector caterers, but merely reflects the environment in which they must work. Progress has been slow. Only 40 of 468 local authorities have followed the example of Lancashire county council. Sadly, it remains the case that the overwhelming majority of eggs purchased in the public sector are caged eggs. As the hon. Member for Brecon and Radnorshire (Mr. Williams) said, that is at a time when companies such as McDonald’s, Subway and Starbucks buy free range eggs.

The trend towards free range and organic eggs has resulted in a strong supply base for those products. Market results from last year show that 47 per cent. of the UK’s egg market is for non-caged eggs, and that sales of free range eggs have increased by 12 per cent. since the previous year—a trend that is expected to continue.

If the fact that the commercial sector is leading the way on higher animal welfare standards for eggs is not sufficient motivation for the Government to prohibit the purchase of caged eggs, there is a simple business case for doing so. Prohibiting public sector procurement of caged eggs would bring down the cost of barn, free range and organic eggs over time by achieving economies of scale secured by long-term public sector contracts.

Compass Group, the biggest contract catering company in the world, has already expressed support for the introduction of mandatory standards for the procurement of public sector food. In evidence to the Council of Food Policy Advisers, a body created by the Minister’s Department, Compass stated that mandatory rules would simplify the procurement process, bring more local suppliers into the supply chain, and bring down the cost of food that meets higher sustainability criteria, including animal welfare standards.

Abundant evidence suggests that healthier and more sustainable public sector food would not increase the cost to the public purse, but bring it down. The East Ayrshire schools’ food for life partnership showed that buying organic local produce had an almost immediate effect on the local economy by creating jobs and increasing profits. It also anticipated longer-term public savings in reducing diet-related ill health and carbon emissions.

The British egg industry would also benefit. It has come a long way in recent years. British egg producers should be rewarded for high-quality eggs reared to high animal welfare standards. A ban on caged eggs in the public sector would be a huge boost for the British egg industry because their supply is more easily available and cheaper when sourced in the UK. We should not forget that there are still more than 300 million laying hens in Europe, more than two thirds of which are housed in battery cages. Without mandatory standards, a cheap and tempting alternative market exists for public sector caterers who want to continue bumping along the bottom.

Taxpayer’s money should be spent on public sector food with a positive rather than negative impact, and for the benefit not just of animal welfare, but of our health, the environment and local economies. The only way to be sure that public sector food serves that purpose is to lead by example.

David Taylor
Will my hon. Friend pick up an idea that many of us on the Select Committee on Environment, Food and Rural Affairs promoted some years ago that Departments should be prohibited from purchasing food that is produced to anything less than the standards incorporated in the red tractor scheme?

Mr. Mullin
Yes. That is a reasonable, desirable and achievable goal, given the necessary political will.

More than £2 billion of taxpayers’ money is spent on public sector food each year. The average British taxpayer forks out approximately £70 a year on food purchased, prepared and served in the public sector. Numerous benefits can be achieved by introducing mandatory health and sustainability standards for the food that that money pays for. Public sector food should help to solve environmental health and social problems, rather than exacerbate them.

The United Nations calculates that the global food system is responsible for between 20 and 30 per cent. of the world’s greenhouse gas emissions. Introducing mandatory sustainability standards for public sector food would have a significant impact on changing what we buy and eat in the UK, and on the environment in due course. That could be achieved by setting an example of sustainable consumption for public sector food consumers, and would have a big impact on bringing down the cost of sustainable produce for the benefit of all consumers.

That would be only a first step. The arguments applying to eggs apply equally to other produce. Creating demand for sustainable produce in the public sector would bring down the cost of organic fruit and vegetables, sustainable fish, and animal welfare-friendly meat and poultry. Mandatory health standards for the public sector would improve health, not least for schoolchildren, hospital patients, and members of the armed forces, many of whom eat public sector food three times a day. It has been estimated that in the UK alone 70,000 premature deaths are caused by diet-related ill health. Public sector food should aim to bring that figure down rather than drive it up.

In a nutshell, a Government commitment to purchase only free range eggs would improve animal welfare, support British farmers, and not increase costs. That can be achieved only with mandatory standards, not by yet another voluntary initiative. It would command great public support and bring public sector food into line with the food that people generally consume at home. That is what is commonly referred to as a no-brainer. I rest my case.

11:19:00

Tim Farron (Westmorland and Lonsdale) (LD)
I am on early, but I probably will not keep my speech going for 40 minutes. In fact, you would not be grateful if I did, Mr. Key.

Mr. James Paice (South-East Cambridgeshire) (Con)
I hope not.

Tim Farron
I concur with the comment from stage right; I will not be long at all.

It is a great pleasure to serve under your chairmanship again this morning, Mr. Key. I sincerely congratulate the hon. Member for Sunderland, South (Mr. Mullin), who secured the debate, on seeking it in the first place and on raising a tremendously important issue. The bulk of his speech was about caged eggs, which is a seriously important issue. Movement away from caged eggs towards humane forms of farming is essential, and UK poultry farmers are leading the way in ensuring that the most humane forms of egg farming become the norm. It is important to say that at the beginning.

We are encouraged to think of ourselves these days as active consumers, not passive participants, and we exercise that power positively and negatively. Like many other hon. Members present, I suspect, and others here, I exercised my own personal boycott of companies that gave succour to the apartheid regime in South Africa, for example. On a positive note, like many others present—probably most of us—I use my consumer power to buy Fairtrade products and locally sourced food.

However, our power as consumers is surely never greater than when our collective power is exercised through public bodies, acting on behalf of us all, choosing to purchase goods and services ethically. How we spend the £2 billion of taxpayers’ money that goes on food each year is immensely important. It is even more important than my refusal in the 1980s to allow Barclays the privilege of managing my student overdraft. We can influence an awful lot of producers and, as we have heard, an entire market with £2 billion. This debate allows us to hold the Government to account for their failure to use that influence positively to date.

David Taylor
The hon. Gentleman is right to point to the scale of the concerns with which we are dealing. Is he aware that the number of chickens bred for meat in this country is about 800 million a year and that the scale of cruelty quite often involved in their breeding and slaughtering is such that anyone who cares about the way in which we treat sentient animals that we are to use for food would be grossly offended? Should we not be focusing on that, as well as on the worthy intentions of my hon. Friend the Member for Sunderland, South (Mr. Mullin)?

Tim Farron
Yes. One measure of a civilised society is how we treat our fellow animals. What I am concerned about and what I know the hon. Gentleman is concerned about is how we use the power of the public purse to achieve the transformation to which he refers. It is incredibly important. The Government have not used their power appropriately or sufficiently and have failed to build animal welfare and other, broader ethical concerns into their procurement policies when they could have done so.

In response to the intervention from my hon. Friend the Member for Brecon and Radnorshire (Mr. Williams), the hon. Member for Sunderland, South referred to the reality, which is that McDonald’s is ahead of the UK Government. I would have thought that was a serious embarrassment to the UK Government and an indictment not only of the policies of central Government, but also of the many different agencies and bodies that spend taxpayers’ money.

There is much to be horrified by, as has been said, but we can be encouraged by the fact that animal welfare standards in the UK are just about the best in the world, and that includes welfare standards at farms that are industrial in scale. As a consequence of our high standards, consumers, including me, buy British as a fairly reliable proxy for shopping ethically. Buying British not only reduces food miles while supporting local farmers, but rewards producers who put animal welfare at the heart of everything that they do, not just in egg production but with regard to all food production.

Mr. Roger Williams
My hon. Friend is making very important points. Egg producers in this country often complain that eggs are imported from areas that have lower welfare conditions, but they also complain that eggs are imported not only as whole eggs but as egg products—liquid egg and powdered egg—so it is almost more difficult to ascertain their source of origin. Those products go into the manufacture of confectionery and so on. The Government ought to be addressing egg products as well as eggs.

Tim Farron
That is absolutely right. My hon. Friend raises a range of issues, one of which I shall come to in a moment—that farmers who farm ethically can find themselves at a competitive disadvantage. There is the broader issue about honesty in labelling, although one hopes that public sector procurers understand what they are buying. If products being purchased in bulk are reconstituted and come from producers with poor animal welfare standards, the consumer needs to be protected generally through honest and accurate labelling, but surely the state—the public sector—will not have the wool pulled over its eyes; it will know what it is buying. There is no excuse for central Government and Government agencies.

Mark Williams (Ceredigion) (LD)
Does that not go to the heart of the matter? The new draft standards for the Government’s healthier food mark still assert that those bulk-buying products have been subject to

“high standards of animal welfare”,

despite the fact that we are still using battery eggs and factory-farmed pork and chicken.

Tim Farron
Absolutely. My hon. Friend makes an extremely good point and it leads us on to what we need to do to support those farmers at home and—dare I say it?—abroad, who are doing the right thing. The hon. Member for Sunderland, South correctly stated that if we back humane egg producers and, indeed, humane farming of all kinds, we shall see an increase in the size of that sector and in its economic health, which will lead to economies of scale and drive down costs. That is tremendously important.

The Government say that they back animal welfare standards at a high level, but when it comes to putting their money where their mouth is, they fall well short. They do not take the lead, which is what we expect of a Government, yet this is a matter in which it is quite simple to take the lead. It is not a case of persuading others to do the right thing; it is something that they can do almost with the stroke of a pen.

The public sector spends approximately £2 billion every year on food procurement, providing more than 1 billion meals for Departments, schools, prisons and hospitals. The national health service is the largest purchaser of food in the country. It spends £500 million, which is nearly a quarter of the total public sector food budget. However, as much as 75 per cent. of the meat products used in our hospitals are imported from abroad.

In Whitehall, the problem is just as bad. I do not think that I have ever had the privilege of going to the Treasury and consuming anything there, but only 60 per cent. of the meat served to staff and visitors to the Treasury is sourced from British farms. The same applies to the proportion of meat sourced from the UK by the Department for Work and Pensions. As has been said, no doubt cost minimisation is the major criterion for those in charge of food procurement, but surely we should ensure that Government policy is not compromised by the rush to get a cheap deal.

In 2005, the British Pig Executive estimated that 70 per cent. of the pig meat imported to the UK was reared in conditions that would have been illegal in this country. Is it right that when it comes to public procurement, taxpayers’ money should be used to endorse and encourage what would be in this country illegally low standards of animal welfare?

The reality is that Departments subcontract catering and often, therefore, procurement to private firms, but it is not acceptable for Ministers to wash their hands of the responsibility. It is entirely possible for tender documents to specify conditions based on quality, animal welfare and local sourcing, and this debate gives the Minister the opportunity to say that he will ensure a change of policy to make that happen.

Ensuring strict animal welfare standards across the European Union is hard because not every member of the Union places the same value on animal welfare as we do. As we have mentioned, that means that standards in the UK are significantly above those of many of our competitors, and it also means that the costs incurred by our farmers are higher. It is not right that our farmers should be at a competitive disadvantage for doing the right thing.

We need to do more than simply employ sticks to beat our farmers if they do not comply; we should also offer a carrot, rewarding and encouraging them for leading the way on animal welfare. What better way to do that than by using taxpayers’ money to buy their produce?

There should be an enforced code of conduct across all Departments and the wider public sector, including the NHS, quangos and other Government agencies and arm’s length bodies. It should include criteria for procurement that ensure that food is sourced locally from within the UK and from producers who comply with the highest animal welfare standards. I urge the Minister to confirm that he will agree to institute and enforce such a code as a matter of urgency.

11:30:00

Mr. James Paice (South-East Cambridgeshire) (Con)
I am slightly disappointed that there has not been more interest in the debate from hon. Members on both sides of the House, although we are obviously all conscious of the pressure on Members’ diaries. None the less, I congratulate the hon. Member for Sunderland, South (Mr. Mullin). In former times, when he was a DEFRA Minister, he and I debated some of the issues before us, and I know how strongly he feels about them. I do not think that there is anybody in the House who is not enthusiastic about improving animal welfare—the issue is how we go about ensuring that we have genuine improvement, rather than something that simply salves our conscience by letting us think that we are doing something about the issue.

At the start, I want to pick up one of the points that the hon. Gentleman made. At one stage in his speech, which I endorse and support, he seemed to confuse sustainability and welfare with the health issues raised by the quality of one’s diet. It would be unwise to imply that eating caged eggs, for example, was any less healthy than eating free-range or any other eggs. One can make all sorts of arguments for not buying caged eggs, but we must be careful not to imply that they are any less wholesome. Indeed, perversely, they are probably slightly safer if anything, because it has been shown that the level of salmonella in them is considerably lower than in free-range eggs. That is an issue, and we have to be careful not to mislead the consumer.

Before I address public procurement, there is another animal welfare issue that we have to consider. When we introduce measures and pass regulations in this country, we have to be certain that we are not simply exporting lower standards to other countries. We did that in the pig industry in 1992—I say this as a former member of a Conservative Government—when we banned stalls and tethers. There was massive support for that, but it is one reason why our pig industry has halved in size since then. The ban is not the only reason why that happened, and it would be wrong to blame it alone, but it put something like 5p per kilo on the cost of finishing pigs. It was quite a serious issue, but we almost certainly did nothing at all for pig welfare, because the industry simply moved to countries that continued to use stalls and tethers. The EU has now taken steps to ban tethers, which is welcome, but the measures are not in place yet, so we are, as the hon. Member for Westmorland and Lonsdale (Tim Farron) said, importing large quantities of pigmeat produced from pigs kept in stalls and, indeed, tethers. We have not, therefore, helped the welfare of pigs overall, even though we might have done something, as I suggested earlier, to salve our conscience.

Mr. Mullin
The hon. Gentleman is making a perfectly reasonable point, but I urge him not to be too hard on the measure that his Government introduced many years ago. It is just possible that it was one of the things that forced the generally somnambulant EU into trying to ban tethers across the region, although I appreciate that it is taking a frustratingly long time to introduce the ban.

Mr. Paice
I am happy to accept that it may have been one of the reasons why the EU was eventually persuaded to apply the same rules across the whole Union.

That brings me conveniently to the issue of eggs, on which the hon. Gentleman concentrated, and on which I want to ask the Minister a couple of questions. As the hon. Gentleman said, the EU has banned conventional battery cages from 1 January 2012. Working backwards from that date, and bearing in mind the lifespan of a chicken, we can see that the eggs from which the last batch of chickens in cages will hatch will be set to incubate next spring, so we are not far away—one or two other things may hatch next spring, but we shall see. The eggs will be incubated next spring, and the pullets will grow up and be put into cages about this time next year. They will be the last batch to go into battery cages.

The time scale is therefore tight, and I am already concerned about two things. First, quite a lot of British producers have not yet invested in alternative systems, and they are going to find life very difficult. Many of them have been to see me, as I am sure they have been to see the Minister, to press for derogations. Personally, I am not particularly supportive of derogations, because there has been plenty of notice, but—this is a big but, and it prompts my request to the Minister—producers are now telling me that a number of countries actually have derogations, Poland being one example. I hope that the Minister will be able to give us details of the derogations that the EU has granted to allow some countries to continue using conventional cages, because such measures will fly completely in the face of attempts to raise standards. That will mean, given the single market, that we will still be able to import eggs produced in conventional cages, and our producers, who will have made the necessary investments, will be at risk of being undercut. This is therefore a serious issue, and I hope that the Minister can address it. My view is that there should be no derogation and that animal welfare should be improved across the whole EU at a particular stage to minimise unfair competition.

As the hon. Member for Brecon and Radnorshire (Mr. Williams), who has just left the Chamber, said, a significant amount of egg is brought into the country in powdered or liquid form. Quite a lot comes from the United States, and it also comes from elsewhere in the world. I am not suggesting that it will be easy to deal with the issue, and I do not know whether such products have the levels of traceability that we would like, but it is a pretty clear bet that they will be from caged eggs, which will be a significant part of the cost of production.

Let me move on to the labelling of food before trying to draw the different threads together. The House has been debating food labelling for many years, and certainly since the era when the changes in pig welfare that I mentioned were made. Governments have frequently said that they are working with industry to improve things, but as Conservative party studies have demonstrated—we referred to this earlier this year—the public are clearly still being misled. People will say that is unlawful and that the law bans misleading labelling, but I am not sure whether the Minister could point to any prosecutions. Public surveys in which members of the public have been shown labels show that people are clearly confused by them. The Minister’s predecessor, the right hon. Member for Liverpool, Wavertree (Jane Kennedy), was quite struck by how deceptive labelling was when she and I did a Jamie Oliver programme about the labelling of pigmeat products.

Nothing has really changed. We now find that the Food Standards Agency, dealing with EU regulations on the Government’s behalf, is voting against EU proposals that would help to clarify food labelling legislation. On the DEFRA website, we read:

“The Food Standards Agency…advises that if meat is described as British it should be made clear where the animal was reared and slaughtered and where processing took place”.

Frankly, that is not good enough. If meat is described as British the animal should have been born, reared and slaughtered in this country. There should be no scope for misleading people about that, which is why my party has committed itself to legislation—although our campaign has been so successful that a large number of supermarkets, including Tesco, have voluntarily set about altering a lot of their labelling. We are obviously very pleased about that.

That approach is essential, because the only way the consumer can exercise choice, whether on price, welfare standards, country of origin or anything else, is by being correctly and properly informed about what is available, and sure of buying what they think they are buying. Once that has been got right, there is an opportunity for the industry to market its wares and exploit the higher welfare standards and, indeed, to be negative about the standards of some imports. It is for the industry, not Government, to grasp that opportunity, but Government should create the framework that enables it to happen.

The debate is about public procurement, and as the result of much pressure in the past few years the Government are moving in the right direction on that issue. It would be churlish of me to deny that. However, I do not think that they have a great deal to be complacent about, because there is a long way to go. I shall refer to some figures in a moment, but it is important to note that when comparing Departments one is dealing with widely differing budget levels, and it is necessary to be a bit careful. I found one table on the Department’s website, headed “Comparison of average total percentages of commodities of UK origin”. It gives the total average of each commodity—meats, vegetables and so on—for 2006-07 and 2007-08, and demonstrates a 2 per cent. increase on the total average. It is an average of averages, and I know that you, Mr. Key, are wise enough not to take too much notice of averages of averages. It is fairly meaningless, and, when one adds to that fact the massive difference between the budgets of Departments, clearly, averaging averages is even more absurd.

The same website has a table of contracts specifying certain objectives. The total value of food provided under catering contracts for the Department for International Development, for example, was just £280,000—one of the lowest amounts. For the Prison Service the value was £1.72 million. For the Ministry of Defence, obviously, the figure was considerably more, and for the NHS it was several million pounds. Thus 100 per cent. of one Department’s food budget would, in the wider context of public procurement, mean nothing by comparison with the budgets of the big Departments.

That leads me to some percentages. If we consider some individual commodities—concentrating on the animal foods sector, because we are debating welfare—we find that just 15 per cent. of poultry meat for the Ministry of Defence is of UK origin. The figure is 0 per cent. for bacon, and 19 per cent. for mutton and lamb. Those figures are atrocious, and they are percentages of a very large budget. I quoted the figures pertaining to DFID’s very small budget, but actually even its percentages are not very good: just 28 per cent. of its poultry meat, 87 per cent. of its mutton and lamb and 15 per cent. of its bacon are of UK origin. In the Department for Children, Schools and Families just 33 per cent. of poultry meat, 9 per cent. of beef, 0 per cent. of mutton, lamb and bacon, and 6 per cent. of pork are of UK origin. Those are horrendous figures.

What should be done about that? Mention has already been made of the little red tractor, and I make no apologies for the fact that we believe it is completely wrong and immoral to spend British taxpayers’ money buying food that is produced to standards that would not be allowed in this country, because Parliament has set rules about how farmers must produce food. We can argue about the adequacy of those rules, and the hon. Member for Sunderland, South and I may differ slightly on that point, but the fact is that we have passed laws about welfare standards in this country, and we import meat that may not meet those standards. That is unacceptable and immoral, and it should change, which is why all public procurement contracts must be moved towards requiring farm assurance—little red tractor—standards. I know that we cannot insist that the food should have that mark, because that could be construed as insisting on UK provenance, but we can ensure that the food is produced to the same standards. That is the best way forward, and it is why we are committed to that approach for all central Government budgets. We are currently considering how to extend it through the devolved area of schools and hospitals. We believe, because of our principles of localised decision making, that they should make their own decisions.

The hon. Member for Sunderland, South and other Members referred to the good examples of public bodies, such as schools, some hospitals and at least one or two local authorities, which have gone about doing what we would all probably propose, demonstrating that, contrary to the argument constantly put forward by central Government that we must bulk-buy because it is so much cheaper—I do not blame the present Government uniquely—when devolved power is driven down to local bodies, those bodies can procure food just as cheaply, and probably to a higher standard.

There are many good schools in my constituency, but I want to mention St. Mary’s primary school in the city of Ely, which took responsibility for its catering back from the county school food service. It gave the budget to the school cook—none of this arty-farty food technician nonsense—and she goes out and buys food locally. It may not always be of local provenance, but it is good quality food. She has substantially increased the uptake of school meals, which are much nicer. The quality is good and the cost is no more than it was under the old centralised system. It is excellent, and I go there at least once a year to have lunch with the children. Other schools are following suit, and indeed another Ely school asked St. Mary’s for support with its catering, because of that success.

There are countless other relevant examples. The county of Cornwall, which I accept is run by a different party from mine, has done a great deal to source Cornish food for its requirements; it can be done. However, it can be done only with a dramatic change of mindset among bureaucrats at all levels, so that they say “Let’s devolve and give responsibility to the people in charge, who will actually prepare the meals.” In that way we shall make substantial strides towards ensuring, as everyone has said, that the £2 billion of taxpayers’ money that is being spent really creates the example we expect others to follow.

23:48:00

The Minister of State, Department for Environment, Food and Rural Affairs (Jim Fitzpatrick)
It is a pleasure to see you in the Chair, Mr. Key. I congratulate my hon. Friend the Member for Sunderland, South (Mr. Mullin) on securing this important debate, and I welcome it as an opportunity to outline the Government’s absolute commitment to the improvement of the welfare of animals.

The UK has the highest animal welfare standards that we have ever had; they are among the highest in the world. For example, this year we reached agreement on a new regulation on the protection of animals at the time of killing, as well as on an EU ban on the trade in seal products. At home, we have introduced new legislation, the Animal Welfare Act 2006. Now anyone responsible for an animal must take steps to ensure that its welfare needs are met. In addition, the Welfare of Farmed Animals (England) Regulations 2007 set requirements in respect of general welfare, inspection, housing and feeding for all farmed animals. Enforcement action can be, and is, taken against farmers who do not comply with that legislation, which is supplemented by species-specific welfare codes. Stock keepers are required by law to be familiar with and have access to those codes, which encourage high standards of husbandry.

Furthermore, last autumn we ran a very successful campaign to help laying hen producers to make informed business decisions. The campaign outlined the options that will be available to them when conventional cages are banned in 2012. It is vital that we work in partnership with the agricultural sector, and we were very grateful for the industry’s support for the campaign. In July, I wrote to the industry restating our commitment to the 2012 EU-wide ban on conventional cages, but reassuring the industry that we would do all that we could to ensure that those UK producers that have already converted from conventional cages were not disadvantaged. To that end, we pressed the Commission for an intra-Community trade ban on eggs produced by hens in conventional cages after 1 January 2012.

In response to the question asked by the hon. Member for South-East Cambridgeshire (Mr. Paice), let me say that we understand that no derogations are in place. I am sure that he is right that some countries will seek derogation, but one of the protections that we would try to put in place, if such derogations were allowed, would be to say, “Okay, you can perhaps ring-fence, temporarily, but you can’t export any products.” That would keep up the pressure. It would also give our producers some solace to know that they will not be disadvantaged. As the hon. Gentleman knows, those discussions are ongoing.

We have also pressed the Commission to introduce into the EU egg marketing regulations a code 4, to signify eggs produced by hens housed in enriched cage systems—those required to have nest boxes, litter, perch space and claw shortening devices—so as to differentiate those eggs from conventional cage eggs, which remain classified as code 3. That will be an additional protection to designate the improved status of those hens. That will aid enforcement and create an improved economic environment for those producers that have already converted.

I accept what was said by the hon. Member for South-East Cambridgeshire, my hon. Friend the Member for Sunderland, South, and others on clearer labelling generally. The House will know that we are working hard with the food industry to improve labelling in the UK, and we are working hard within Europe on all aspects of labelling—country of origin, provenance and so on—for the benefit of consumers.

On the alternatives to conventional cages, there is no scientific evidence to favour one legal production system over another. Each has its strengths and weaknesses. Research has shown that free-range and barn systems may result in higher mortality, an increased occurrence of painful fractures and a greater risk of feather pecking, cannibalism and predation than a system of enriched cages. However, enriched cages offer the challenge of allowing hens the freedom to express normal behaviour. The EU Commission, in its 2008 report on the welfare of laying hens, and the Farm Animal Welfare Council, which advises the Government on on-farm animal welfare issues, both recognise the welfare benefits of enriched cages, and they have given their support to that system of production.

Although we have been working hard to ensure that the supply side supports ever-higher welfare standards, we have also been trying to increase demand for healthier, more sustainable food by showing leadership in the public sector. The public sector food procurement initiative—the PSFPI—has been a driver for change. A review of the PSFPI last year showed that there had been clear progress against its objectives, which include promoting animal welfare. However, we know that there is still room for improvement, which is why we are continuing to take forward a number of initiatives.

One of the key challenges raised with us by stakeholders from all sides is the need for the Government to set out a consistent and coherent view of what the food system should look like in the future. That is why we are developing a food strategy to bring together the various elements of food policy, with the aim of setting out a vision for the food system in 2030. The part on animal welfare will echo the wording in the leaflet “The Future of our Farming”, published in August, which says that good farm businesses are those that produce high-quality food to high environmental and welfare standards.

The first of those elements is the healthier food mark. For the first time, there will be a national food procurement scheme that seeks to combine both nutritional and sustainability criteria. More than 60 public sector organisations volunteered to be part of the first phase of the pilots. The healthier food mark includes two criteria that address the issue of animal welfare. The first criterion, which aims to ensure that

“100 per cent. of meat and meat products are farm assured…as a welfare minimum”,

has been included in the list of proposed criteria for the healthy food mark. Public sector food procurers are not restricted to sourcing produce from the UK. Indeed, everyone will be aware that they are legally required to ensure that tenders are open to all suppliers. However, by including that criterion we are ensuring that meat and meat products procured by the public sector meet UK animal welfare standards, which in many respects go beyond EU minimum legal requirements.

[Jim Sheridan in the Chair] 

The hon. Member for Brecon and Radnorshire (Mr. Williams), who is not in his place, asked about egg products as well as eggs. The healthier food mark pilots will be asked to consider that issue, and will extend beyond eggs.

Mr. Mullin
My hon. Friend makes a powerful case for the direction of travel that the Government have taken over the years. May I ask him to address the question of compulsion versus voluntary codes? That was one of the main points that I was trying to make.

Jim Fitzpatrick
My hon. Friend makes an entirely valid point. I know that his position is that we should travel down the route of compulsion. He is correct to say that I am trying to make a case for the good progress that has been made, and to outline what we are trying to do through encouragement. As I shall explain, we are trying to approach procurement in a quasi-voluntary way, but with a clear identification of higher standards that can be measured by those in public procurement positions. That is on top of measures introduced through the Animal Welfare Act 2006, and measures that we are securing in the EU, through our discussions about cages, stalls and the rest of it. That is a multifaceted attempt to drive up standards by means of the carrot and the stick—through voluntary as well as legislative measures. I shall say more about that in a moment. The healthier food mark will indeed be voluntary initially, but in 2012 we will review the scheme to see whether we could and should make it mandatory.

Mr. Mullin
Is not the evidence so far that voluntary measures do not really work? I mentioned the fact that, so far, only 40 of 468 local authorities have gone cage-free. Good though that is, it is very slow progress. I come back to the evaluation to which, I think, my hon. Friend speedily referred. That evaluation by Deloitte—if that is what he was referring to—said that

“Take up of the initiative was limited”.

Jim Fitzpatrick
I did not mean to speed over points deliberately, or not to pay them appropriate attention. Like other colleagues, I anticipated there being more speakers in this debate. I therefore edited my comments to ensure that others had as much time as possible.

On the progress that is being made under the present infrastructure, several Members pointed out that the use of consumer power reinforces their argument that there has been movement when it comes to the ethos of eating and procurement. The best example is McDonald’s. My hon. Friend the Member for Sunderland, South, referred to that company’s sensitivity and its position in the market. The fact that McDonald’s has moved demonstrates that it recognises public opinion. It is getting ahead of the game, so that it can try to maintain, if not increase, its market share. In the marketplace, blue-chip corporations involved in food supply are moving forward, and I shall give at least one more example of progress in the public sector, too. That shows that we are talking about a moveable feast, if you will excuse the pun, Mr. Sheridan, and it is moving in the right direction—the direction that my hon. Friend wants us to take.

The second animal welfare criterion being considered as a potential entry on the healthier food mark list is the aim of having

“100 per cent. of eggs…sourced from systems which do not use conventional cages.”

Owing to stakeholders’ concerns about the number of criteria, that is only listed as a potential criterion; we consider that the impending ban on the use of conventional cages will drive the outcome.

In February 2008, we issued a notice to all public sector contracting authorities to alert them to the ban on conventional cages from January 2012. The purpose of the alert was to enable buyers to reflect the new regulations in forthcoming contracts, and that, in part, answers the question that the hon. Member for South-East Cambridgeshire asked about lead-in times and the ability of producers and purchasers to make adjustments in respect of the new regulations.

The Department for Environment, Food and Rural Affairs is working with the Office of Government Commerce on the collaborative food procurement programme, which aims to use collaboration between public sector buyers to generate better value and higher quality, and to embed sustainability and animal welfare in procurement decisions right across the public sector.

In the summer, I wrote to Ministers in every Department to ensure that they were aware of how much importance the Government attach to the higher welfare standards. I accept the points made by the hon. Member for South-East Cambridgeshire about averages, and I would not quibble with him. However, we do not want to camouflage the progress that has been made; in some areas, it is better than in others. None the less, we are trying to address the issues and to make even better progress. I have begun meeting other Ministers, starting with those in charge of the biggest food-buying Departments, to discuss procurement issues. We will look at those who are doing well to identify how they have been able to make such progress. We will also look at those who are not doing so well and listen to them to find out what obstacles they may be encountering. We will share best practice across the Departments, and that will then feed down to the wider public sector. For example, I will examine the purchasing of the Department of Health and then move on to the NHS. Likewise, I will examine the purchasing of the Department for Communities and Local Government and then move on to local government, and so on, to try to ensure that we can make additional progress.

I was interested to hear the point that the hon. Member for South-East Cambridgeshire made about his cook in Ely. One issue that has come up recently in our meetings with the Food Standards Agency and the Council of Food Policy Advisers is the fact that, because of devolved budgets, there are now some 35,000 purchasing points within the public sector. It is possible that the skill level of some of those procurement officials is not appropriate. For example, they may be great at purchasing stationery, because that is their background, but they are now having to purchase food for the Department. We must consider the skills set of the people in those purchasing areas. The cook obviously knows exactly what she is purchasing and is making positive choices, getting better value for money and producing healthier meals. However, she probably does not represent the majority; she may be a very good representative sample, but we must ensure that everyone in the public sector has the appropriate skills to make the appropriate choices.

Mr. Paice
I thank the Minister for what he has said. He is right that there is an issue with buyers being responsible for stationery, desks and everything else, including food. That is the problem. The person buying the food should be not the purchasing officer but the person responsible for preparing the food. If we drive decisions further down, we will get the benefit.

Jim Fitzpatrick
The hon. Gentleman makes a fair point. In the exercise that I am conducting with other Ministers and within DEFRA, I am trying to identify what is working well, and am then sharing that best practice to ensure that it is as effective as possible. I should inform my hon. Friend the Member for Sunderland, South that DEFRA’s caterers have made their own decision, and buy only free-range eggs and UK-sourced meat. Again, no legislation compelled them to do that. I am talking about a private sector catering contractor that is making a judgment based on what it thinks the consumer wants. It believes that by doing what the consumer wants, it will sell more of its products, thus making its business more efficient.

In conclusion, I agree with my hon. Friend on the importance of the welfare of animals in our care, and I agree that there is some way to go before we can really say that we have reached the desired standards. We must do things that reflect the public appetite for change as well as the need for value. We must ensure that our food and farming industry moves with us to deliver the change that we all want, and the change that allows us to work with our international trading partners for a secure, sustainable and fair food supply, now and in the future. I congratulate my hon. Friend on securing this important debate and would like to express my appreciation to all hon. Friends and hon. Members who have contributed.

12:05:00

Sitting suspended.

 Thames Valley Police

12:30:00

Mr. Richard Benyon (Newbury) (Con)
It is a great pleasure to serve under your chairmanship, Mr. Sheridan.

I secured this debate to represent the views of my constituent, Paul Fidler, and the employees of his company, Wessex Recovery Ltd. I believe strongly that they have been the victims of a miscarriage of justice. Wessex Recovery Ltd is owned entirely by Mr. Fidler. It was formed in 1991 and since 1993 has had a contract with Thames Valley police for the recovery and storage of light and commercial vehicles across a large part of the force’s area. In 2007, the contract ran out and operators tendered for the new contract with a new management company, Recovery Management Services Ltd. Wessex Recovery secured the contract and appears to have proceeded with an unblemished record from Thames Valley police and those it serves.

On 23 February 2009, Mr. Fidler was summoned to a meeting with John Marks, the chief executive officer of RMSL, John Brigham, a legal adviser to RMSL, and Phil Newberry, the RMSL scheme manager. The meeting was called by Mr. Newberry following a phone call the previous Friday regarding “a contractual matter”. At the meeting, Mr. Fidler was informed that Thames Valley police had requested the termination of Wessex Recovery’s contract and that RMSL required the suspension of Wessex Recovery. RMSL said that the suspension had been requested without any explanation, other than that there was a “problem” with Mr. Fidler—not with Wessex Recovery. John Marks had asked Thames Valley police for further explanation, such as that an arrest was imminent or that there was an ongoing investigation concerning Paul Fidler. Thames Valley police answered no to both questions.

RMSL considered a number of operational possibilities. The upshot of the meeting was that Thames Valley police would accept only certain options and had certain conditions. The first option was a share sale of Wessex Recovery Ltd by 4 pm on the same day. The second was that the company be signed over to an independent person in a caretaker capacity and that Mr. Fidler provide a declaration that he would not set foot on his premises at Halfway depot, which is near the A4 between Newbury and Hungerford. Additionally, because Mr. Fidler’s house was adjacent to the depot, a new driveway was to be constructed so that he did not have to step on any ground covered by the operations of the depot. The third option was that Mr. Fidler could live elsewhere and initiate the immediate sale of his house. A further condition was that the internet protocol address for the depot’s CCTV system be made available to Thames Valley police so that it could ensure that he did not enter the premises.

Mr. Fidler’s business is worth between £2 million and £4 million. It is perverse and extraordinary to ask an individual to sell a company without giving any reasons. Selling a company is not an easy business. It requires a lot of due diligence work and cannot be done within a few hours. The first thing Mr. Fidler did was to try to find out the reasons for the decision, but answer came there none. He therefore visited my surgery at the end of May 2009 to seek my assistance.

I first contacted RMSL by telephone and was told that it was not obliged to give me any further information. I followed that up with an e-mail to the chief constable on 29 May. Her reply gave no information about why the decision had been taken, but said that it had not been taken lightly. I followed that up and received a letter from the chief constable on 22 June that added no further information. However, she wrote to Mr. Fidler, setting out the reasons for the suspension of his contract. The reasons related to two allegations of improper conduct with females.

The first allegation was made by a former member of staff at Wessex Recovery on 15 July 2008. Mr. Fidler had been arrested on 17 July 2008 and had strenuously denied the offence. I have no intention of going into the details of the case. However, the more I look into it, the more I feel that it would not have stood up to scrutiny in court due to the many conflicting factors. On 4 September 2008, the complainant made a further statement withdrawing the allegation. No charges were brought against Mr. Fidler in respect of the incident.

The second allegation concerned a previously unknown allegation made by a Thames Valley police scene of crimes officer on 21 July 2008. The allegation related to something that had occurred eight months previously in November 2007. The incident was not reported at the time and the complainant was adamant that she did not wish to support any proceedings against Mr. Fidler. She carried on working at the same location and in the same environment for many months after the alleged incident and did not bring it to anyone’s attention. She said she was reporting it on 21 July 2008 because she had become aware of the other allegation to which I have referred. Mr. Fidler was not arrested or interviewed about the allegation, no charges were brought and no statement was made. It appears that Thames Valley police was supporting its decision on the basis of pure hearsay.

At the end of her letter to Mr. Fidler, the chief constable wrote:

“I can assure you that the approach of Thames Valley Police was not arrived at lightly, or without serious consideration of all options”.

When Mr. Fidler showed me this letter, it left me with more questions, not fewer. After much thought, I wrote to the chief constable on 30 June. First, I pointed out that it seems bizarre to tell the owner of a company with a large, seven-figure turnover that his options include selling the company that day to another operator. As I have said, the sale of a company is a complex business that requires due diligence and all manner of contractual arrangements.

At the root of the problem are the allegations. I understand that Thames Valley police has to look seriously at an individual who interfaces with its staff and against whom a complaint of sexual harassment has been made. However, any organisation contemplating the removal of a contract that would be a devastating blow on an individual, his family and his employees—in this case 65 employees—should carry out the fullest possible investigation. At the least, the two individuals concerned in the allegations, Wessex Recovery staff and the police officers who dealt with the complaint should have been interviewed. Under the rules of natural justice, I believe that Mr. Fidler should have been interviewed, and at great length if necessary. I therefore question the assertion that

“serious consideration of all options”

had been carried out and that the decision had not been taken lightly.

I wrote to the chief constable again on 29 July to ask whether the independent investigator from the professional standards department interviewed Mr. Fidler, the two women at the centre of the allegations and the police officers who investigated the allegation. I have had no response to those questions. All I heard from the chief constable, for whom I have the highest regard in all other matters, was a further assertion that the decisions were not taken lightly. She also wrote:

“I am not sure that you and I will be able to take this matter much further in correspondence”.

She seemed to leave the situation open for Mr. Fidler to take legal action. However, as hon. Members know, such legal action is expensive, especially for somebody who has been put in a difficult financial position by the initial decision.

My next step was to consult Mr. Fidler’s local councillor, who also happens to be West Berkshire’s representative on the Thames Valley police authority. With Mr. Fidler’s agreement, I laid out all the facts, as I know them, for Councillor Anthony Stansfeld. He had much the same reaction as I did, and took matters up himself with the chief constable and others. However, he has hit the buffers with this investigation in the same way as I have, and I am therefore seeking the assistance of the Minister to try to unravel what has happened.

On at least two occasions, I have said to the chief constable that if she were to say to me that there is much more to this matter than meets the eye and that she is simply unable to give me the details, I cannot say that I would be happy, but I would be less inclined to follow up the matter, as I am doing today. In our roles as Members of Parliament, we are frequently visited in our surgeries by people who give us cases that, on the surface, seem cut and dried, but bitter experience has shown us that there are two sides to every argument. In this case, I am getting only one side of the argument and the more I investigate the matter, the more I feel that an injustice has been done.

I understand Thames Valley police’s concern about the safety of its staff and that that might require it to make difficult decisions from time to time. However, I am worried that this decision has been taken without proper investigation or regard to the rules of natural justice in a way that shows either an organisation that is too risk averse, or that makes such decisions in a slap-dash manner in the hope that, because it is a large organisation and Mr. Fidler is an individual, the problem will just go away in due course.

The more I am involved in the case, the more certain I am that I wish to follow it through to some sort of conclusion. We might get some degree of closure today in that, on hearing these words, the Minister might conclude that an investigation needs to be carried out by an independent body or individual into the exact circumstances of the termination of the contract. At the very least, I hope that this debate will encourage Thames Valley police to look very closely at its procedures. I simply cannot understand how any public body can be prepared to remove the livelihood of an individual and  his family, and potentially the livelihood of 65 employees, without being prepared to give any reasons for the removal of that contract.

I leave the Minister with two points. Wessex Recovery Ltd, with its 100 per cent. shareholding by Mr. Fidler, retains a contract with Hampshire police for work similar to that which it carried out for Thames Valley police prior to 23 February. The contract with Hampshire came up for renewal after the contract with Thames Valley police was suspended and, in the full knowledge of that suspension, Hampshire police has re-awarded Wessex Recovery Ltd its contract. If for no other reason, I submit that that makes Mr. Fidler’s case yet stronger.

My second point is that seven months elapsed between Mr. Fidler’s initial arrest and the decision to terminate the contract. Thames Valley police contacted RMSL, gave it one working day to terminate the contract and attempted to force through a sale of the company in just a few hours. However, I repeat: seven months had elapsed. Thames Valley police cannot have been as concerned as it now says it is if it was prepared to allow seven months to elapse before it took action.

As things stand today, a cloud hangs over Mr. Fidler and will do so for the rest of his business life, as he has to declare that he has been suspended from a contract in all future tender documents. In addition, a cloud has been placed over his character and reputation based on the flimsiest of evidence and investigation. I urge the Minister to consider the level of injustice and to instigate a full and independent inquiry without delay.

12:44:00

The Parliamentary Under-Secretary of State for the Home Department (Mr. Alan Campbell)
It is a pleasure to serve under your chairmanship, Mr. Sheridan. I congratulate the hon. Member for Newbury (Mr. Benyon) on securing the debate and on the way in which he has raised what is clearly a serious and important constituency matter for him. There are strict limitations on what I am able to say to the hon. Gentleman today, but at least he has had the opportunity to raise in Parliament what he clearly believes to be a miscarriage of justice.

The Home Office is responsible for setting the level and structure of the charges, but we cannot become involved in contractual arrangements between individual police forces and managing agents or vehicle removal operators, or any police decision that leads to the suspension or termination of a contract with an individual recovery operator. I cannot therefore specifically comment on Thames Valley police’s decision or on the specific circumstances that led to the suspension of Wessex Recovery’s contract with RMSL, which is the managing agent for the Thames Valley police vehicle recovery scheme.

This is a very sensitive issue and I understand from the chief constable of Thames Valley police that the force took the decision that it could no longer support the involvement of Wessex Recovery in its vehicle recovery scheme on the grounds of public protection and that, in doing so, it carefully balanced the impact on the owner of Wessex Recovery and other staff, following consideration of alternative options. I understand that the chief constable has written to the owner of Wessex Recovery to explain the reasons for the decision and that the chief constable has been engaged in detailed correspondence with the hon. Member for Newbury on the issue.

Mr. Benyon
The chief constable wrote to Mr. Fidler only when I wrote to her. Does the Minister not agree that it is a strange way of doing things to tell the contract manager to terminate the contract, not giving any reason why and not giving any reason to the MP concerned until I contacted her and she approached Mr. Fidler?

Mr. Alan Campbell
I suppose we can conclude that however frustrated the hon. Gentleman is about the process, there was a written response. I shall go on to how he might want to seek redress if he is not satisfied when he reflects upon how the whole process has been handled.

Of course, as the chief constable made clear, Mr. Fidler may wish to seek redress on the matter by obtaining legal advice. I understand the limitations that individuals might have in doing that, but nevertheless the option remains available. At the end of the day, this is a contractual matter; it is not a matter that the Home Office can get involved with in the way that the hon. Gentleman seems to be requesting.

I want briefly to explain the limited role that the Home Office has in the important business of the removal, storage and disposal of vehicles on police instructions. The removal and recovery of vehicles from roads or any land in the open air by contractors acting for the police is an important day-to-day activity in all forces. The Government and the police value the work of the contracted recovery operators who remove vehicles on police instructions. However, the precise arrangements adopted by police forces for the safe recovery of vehicles, including the engagement of contractors, either directly or through managing agents, to carry out that work are an operational matter for individual chief officers of police. The Home Office has no remit to become involved in such commercial and contractual matters and it certainly cannot comment on the individual circumstances of a particular case.

I want to reiterate that if the hon. Gentleman’s constituent is seeking redress on the issue of termination of the contract and the circumstances that prevailed, he should pursue a legal route. Ministers cannot become involved in the issue and it would not be appropriate for Ministers to comment on the way in which particular individual allegations are investigated by the police or on the decisions that followed from those investigations. Those are matters for chief officers.

There is a due process. If the hon. Gentleman believes that due process has not been followed and if, having complained to the police—I understand that he has done so and that the investigations have been looked at—he remains unhappy with their response, his constituent may wish to refer the case to the Independent Police Complaints Commission. I know that the hon. Gentleman will be disappointed.

Mr. Benyon
I am grateful to the Minister for responding to the debate, and I understand the limitations on him and the Home Office. I should like to put on the record again that I have a very good working relationship with the chief constable; I hope that good relationship continues after today. However, the purpose of MPs, every now and again, is to stand up for people whom we feel have been brow-beaten by a large organisation, particularly if it is a public one. There must be a method whereby ordinary Members of the House can represent their constituents on issues such as this if they feel that an injustice has been done, rather than individuals having to go through the courts themselves.

Mr. Campbell
I understand that. Standing up for people is a key part of what Members do. The hon. Gentleman is doing that, and there is some force in his argument. Whether the issue concerns public organisations or not, active and committed Members of Parliament such as him have a right to raise these matters. However, it is not for Ministers to second-guess decisions or to comment on procedures if the responsibility for those procedures, and for their investigation, lies elsewhere. If he and his constituent are not satisfied about the way in which the contractual aspects of this case have been dealt with, a proper and independent view of the matter could be gained by taking it to court.

Let me address the hon. Gentleman’s concern about police forces. I am delighted that he has full confidence in his chief constable, as do I, and I am quite sure that their respect for each other’s role will ensure that his decision to pursue a matter that has her force at the centre will make no difference to their relationship. I repeat that it is not for Ministers to second-guess or to investigate individual matters such as these. The hon. Gentleman or his constituent may wish to raise the matter with the Independent Police Complaints Commission and get its view. That is one of the responsibilities that we have given that body.

I understand that having raised the matter in the House, the hon. Gentleman will be disappointed by the response, but I hope that he will appreciate the limitations on us and the need to be cautious and not overstep our responsibilities. Some of his comments have raised issues about the policy framework in which certain decisions are made. If he feels it would benefit him, I shall be pleased to meet him to discuss those policy matters, with reflection on this case. However, that offer is placed within the strict limitations of what is available to Ministers, and the same will apply to any advice that I can offer him.

12:52:00

Sitting suspended.

 MG Rover

13:00:00

Richard Burden (Birmingham, Northfield) (Lab)
I am grateful for the opportunity to raise with the Minister the results of the investigation into the affairs of Phoenix Venture Holdings Group, MG Rover Group and 33 other companies. I am pleased to be joined by my hon. Friend the Member for Birmingham, Hall Green (Steve McCabe), who has taken a close interest in the issue, and I know that many other hon. Members with constituencies in Birmingham or the west midlands who cannot be here today are concerned about the issue.

The investigation was commissioned in 2005 by the then Secretary of State for Trade and Industry, my right hon. Friend the Member for Kingston upon Hull, West and Hessle (Alan Johnson), soon after the collapse of MG Rover Group at Longbridge in my constituency. The investigation was headed by Gervaise MacGregor and Guy Newey QC. It had been set up under section 432(c) of the Companies Act 1985 and had a wide range of powers and a high degree of independence, both of which were important for its credibility.

The inquiry certainly had to look at some highly complex issues, but I am not alone in questioning why it took more than four years to report and cost around £16 million. I ask my hon. Friend the Minister to consider how we can ensure that future comparable inquiries will be neither excessively costly, nor so long drawn out, without compromising their independence or thoroughness.

Some have suggested that much of what is in the inspectors’ report had already been said or alleged before. There is something in that, but it does not alter the fact that the their findings are significant. The report’s 830 pages meticulously catalogue how the companies associated with MG Rover were structured and then restructured and how money was moved around between 2000 and 2005. The report is damning of the actions of the directors of Phoenix Venture Holdings, the so-called Phoenix four, during that time. That they paid themselves a lot of money during their stewardship of MG Rover was well know a long time before the report. I was one of those who asked questions about some of those things years ago, and my criticism at that time of the Phoenix four’s largesse towards themselves is on the record.

However, what is devastating about this report for the Phoenix four is not what it reveals about the amounts they paid themselves, or that they saw considerable personal gain as a desirable or justifiable consequence of building a successful company, but that personal gain—some would say greed—was their central objective from the start of the Phoenix takeover of Longbridge. That objective took precedence over the interests of MG Rover as a car maker and the interests of the employees, from whose efforts the Phoenix four benefited.

I do not have time to go through all the report’s findings, or even most of them, but I will offer a flavour of some of the things it contains. It provides evidence that from the word go at least some members of the Phoenix consortium were seeking to make around £75 million for themselves, not from engineering cars, but from engineering company finances. They did not reach that target, but they got a long way towards it. The report shows how losses were locked into the car-making business with profits going elsewhere. Despite what was claimed at the time, many of those profits were not recycled back to support the car manufacturing business.

The Phoenix four made sure that their own stakeholdings in the business brought them significant personal remuneration and the power to make decisions. The shares they distributed to their employees, however, brought neither income, nor influence over company decisions. The Phoenix directors still awarded themselves millions for their own sacrifice in making those employee shares available.

Phoenix invented a range of money-spinning schemes, which some people might call scams. The names were sometimes bizarre, like Project Patto or Project Lisa, and sometimes the names spoke volumes in themselves, such as with Project Aircraft. Not all of those schemes saw the light of day, but all seemed designed principally for personal or corporate gain. Phoenix Venture Holdings’ advisers, such as Deloitte and, to some extent, Eversheds, helped to design some of those schemes, and the millions they got in fees for their trouble raises important ethical questions. Perhaps even bigger ethical issues are raised by the report’s revelation that one Phoenix director, Peter Beale, chose to install a programme called “Evidence Eliminator” on his computer the day after the investigation was announced in 2005.

I would like to say a little more about one project, Project Platinum, which established MGR Capital, the vehicle through which the former BMW loan book for Rover was acquired during the Phoenix years. Acquiring that loan book was the right thing to do for MG Rover as a car company, but there are and always have been real questions about why MGR Capital was set up outside the Phoenix group of companies. The result, of course, was that when the money finally came in it would be shared between members of the Phoenix consortium and their partners at Halifax Bank of Scotland, rather than ploughed back into investment in MG Rover. I and others questioned the Phoenix directors about MGR Capital as long ago as 2003. It was also one of the subjects on which the inspectors suggest that I, and Parliament itself, received misleading replies and information from one or more of the directors.

Therefore, I welcome the decision of the Business, Innovation and Skills Committee to invite the Phoenix directors back to Parliament to explain these things. The Phoenix four should accept that invitation. It is not good enough for them simply to rubbish the inspectors’ report through their PR firm without answering the report’s central charges. If the Phoenix four have answers, we all deserve to hear them, and we deserve to hear them in public and on the record.

I was never one who joined in the backstairs briefings against Phoenix Venture Holdings even before it signed the deal with BMW to take over Longbridge. Indeed, I criticised some of those responsible for those briefings because they never seemed worried that their words might not only highlight genuine concerns about the conduct of a bunch of directors but destabilise the future of MG Rover itself, threatening the livelihoods of the thousands of MG Rover workers, from those on the shop floor to senior managers, who were genuinely trying to make a go of the company, a company that was so important to manufacturing in the west midlands as a whole.

Let us not forget that in the circumstances we faced in Longbridge when BMW pulled out in 2000 it was not wrong to ask BMW to consider alternatives alongside the deal it was proposing to do with Alchemy Partners. It was certainly not wrong to back the only alternative in town when negotiations between BMW and Alchemy broke down on 28 April 2000 and Longbridge faced the real prospect of closure, with the likely loss of over 20,000 jobs in the west midlands and beyond.

Perhaps the Phoenix four are all resigned to going down in history as greedy, but I am sure that they would also want to be remembered for genuinely trying to build a future for car-making at Longbridge and, when that failed, finally doing the right thing by all those who worked for them. They do not have much credibility left, but for what remains of that credibility, and because it is the right thing to do, I ask the Phoenix directors to agree to the following. First, there should be no more delays in putting money into the trust fund they set up for their former employees. They say that there are still all kinds of procedural impediments causing delays nearly five years on from the closure. That may be the case, but I say bluntly that that is their problem. They made sure that there were no impediments when they paid themselves millions each to insulate themselves from the consequences of company failure. They now have a responsibility to their employees which they should honour without delay.

The second thing concerns MGR Capital. It is unclear where the wind-up of MGR Capital is up to, but there are reports that there could be proceeds of between £16 million and £22 million. My understanding of the structure of the company is that the money could be shared by HBOS and members of the Phoenix consortium. I say no to that. Let the proceeds from MGR Capital be at least one positive legacy of the Phoenix years. I say to the Phoenix consortium that it should put part of its share of MGR Capital’s profits towards the trust fund for its former employees and the rest of it into a community development trust so that local people can have a direct say in, and direct benefit from, redevelopment of the Longbridge site and the surrounding area.

And HBOS, the Phoenix consortium’s partner in MGR Capital, should show that the banking sector itself is recognising some social responsibility by investing its profits from MGR Capital in the venture, too. Those things are unfinished business. They are things that could still happen, and I ask my hon. Friend the Minister to do what he can to make them happen.

13:12:00

The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Ian Lucas)
It is a pleasure to appear before you, Mr. Sheridan, I believe for the first time. I thank my hon. Friend the Member for Birmingham, Northfield (Richard Burden) for calling this debate. I know that he has worked assiduously for many years on matters concerning the Longbridge site, first in 2000 when this story began, through 2005 and in the years since. I welcome my hon. Friend the Member for Birmingham, Hall Green (Steve McCabe), who has worked with my hon. Friend the Member for Birmingham, Northfield on these matters.

Whenever a redundancy situation occurs in any of the communities that we represent, it is extremely serious, so back in 2000 when BMW was about to divest itself of its interests in the Longbridge site, it was entirely understandable and explicable that the community as a whole took the steps that it did. The hard work that was done and the public support at the time for the Phoenix consortium are evident from the report. It is against that backcloth that we have to consider subsequent events and the actions of members of the Phoenix consortium.

The collapse of MG Rover in 2005 reverberated not just through communities in the west midlands but across the United Kingdom. More than 6,000 people lost their jobs, individual employees and families were hit extremely hard, many creditors were left with unpaid bills—the total was £1.3 billion—a major UK car manufacturer went into liquidation and many suppliers lost a key customer. The west midlands region was dealt a body blow, and I am sure that the impact is still being felt today.

It was important and absolutely right that the Government set up an independent inquiry to find out what led to the collapse. Those who were affected need to know the truth about what happened, because there have been many allegations and ill-informed rumours. The report sets out in great detail—more than 800 pages, as my hon. Friend said—the extremely complex history of events leading up to what happened in 2000 and in subsequent years. The report is important as a point of reference for people. The story is complicated and the report contains a great deal of detail, but it is there for the public to see. The inspectors painstakingly studied a complex structure of 33 companies that made up the MG Rover Group and its parent, Phoenix Venture Holdings. They also looked closely at the role played by certain directors.

When a company controlled by John Towers and his fellow directors bought MG Rover from BMW in 2000, they were welcomed by the workers, the suppliers and the local community because it appeared that they would save jobs and the business, but it is evident from the report that, from the outset—it was true throughout—they needed a joint venture partner to ensure the long-term survival of the business. Although there were several attempts to find a partner, five years later they had not signed one up, and losses were accumulating, car sales were falling and insolvency loomed.

However, it is clear that throughout that five-year period of such difficulty for the company, the Phoenix directors were prospering. The so-called Phoenix four had spent considerable time and effort designing projects to shift assets away from MG Rover to other companies in the group owned by them, instead of using the money to support car manufacturing. The report details not the tens of thousands or hundreds of thousands but the millions that were paid to the individuals concerned. The inspectors found that during those five years, the directors took

“unreasonably large, financial rewards, totalling tens of millions of pounds.”

Inspections of that kind take time and invariably cost considerable sums—in this case, £16.3 million. That is why they are so rarely deployed. The inquiry was complex and has clearly cost more than anyone would have liked. I take on board what my hon. Friend the Member for Birmingham, Northfield said about the time that the inquiry took, and its cost. However, it was important that the inquiry be independent. The difficulty from the Government’s point of view was that interference at any stage in the conduct of the inquiry would have led to allegations that they were seeking to intervene in the inquiry in some improper way. Certainly any interference by the Government once the inquiry had been set up would have been entirely inappropriate, but there are lessons to be learned from the situation. The position and the terms of reference of the inquiry at the time that it was set up should, perhaps, be looked at for the future.

In addition to setting out the story, the inspectors also suggested that changes should be considered to financial reporting standards and guidance to increase transparency. The aim would be to help users of company reports and accounts better to understand a company’s financial position, including the value of assets. The Financial Reporting Council is looking carefully at the lessons from this case. Work is under way to bring legal proceedings against the relevant directors with a view to seeking their disqualification by the court, or their offering to undertake not to be involved in the management of companies for a period of time.

My hon. Friend referred to the trust fund. I took questions in the House when the report was released so I know that it is a matter of profound concern to everyone—to Members and, more widely, the west midlands community. The reason the trust fund was set up in the first place—at the time of the collapse of the company—was to assist a west midlands community that had been dealt a body blow, and to dispel concerns that were being expressed about what had happened before that.

We all know that, until now, the trust fund has simply not delivered in any respect. The justification that has been provided for the trust fund’s not delivering is that we were awaiting the outcome of the inspection report. The report is now available. If there is to be no distribution or investment in the trust fund, we need to know why that should be so at this stage, because the community has had to deal with the consequences for almost five years. Individuals have had to rebuild their lives and the community has had to rebuild itself during that period. It is about time that the commitment given voluntarily in 2005 is lived up to by those who gave it. We ask no more than that individuals follow the lines that they outlined in 2005 and make a commitment to the community in material terms, not just in words.

I note closely what my hon. Friend said about MGR Capital. The evidence we have is that funds are available in MGR Capital—it is outside the remit of MG Rover itself and outside the remit and control of the liquidator, but money is there. If those who had influence in MG Rover in 2005 and when the trust fund was set up, and who now have influence relating to MGR Capital, want to live up to the expectations that they created, they should use available funds to support the community that my hon. Friends in the Chamber represent. That is a moral obligation on them. I say to my hon. Friend the Member for Birmingham, Northfield that I will do anything that I can both in respect of that moral obligation and to support exploration of whether any  legal obligation is involved that would enable action to be taken. I will look into that on behalf of my hon. Friend and his constituents in the west midlands.

The community has had to move on. Important regeneration work is going on there. The Longbridge area action plan is designed to redevelop the MG Rover site, and my hon. Friend has been working on it with his parliamentary colleagues for a number of years. The total project cost is £66 million, with direct Government funding from the Learning and Skills Council of just under £54 million. In particular, the new Bournville college will deliver a much-needed boost for the Longbridge area with the creation of a first-class learning environment on a par with other LSC capital schemes.

The community is rebuilding, but those who have benefited to the tune of millions of pounds from the sad story of MG Rover’s collapse, which has been set out in so much detail, need to support the community from which they have benefited. I call on them to do everything that they can to support the community and to deliver on the promises they gave when MG Rover collapsed in 2005.

13:23:00

Sitting suspended.

 Muscular Dystrophy

13:30:00

Mrs. Caroline Spelman (Meriden) (Con)
I have called this debate to draw attention to the need for specialist, multidisciplinary care for everyone with muscular dystrophy and related neuromuscular conditions. Around 75 people in my constituency and more than 60,000 people in the UK are sufferers. I have a personal interest in the matter as a maiden aunt, with whom I grew up, suffered from a degenerative muscular condition, which left a great impression on me as a child.

I thank the Muscular Dystrophy Campaign for bringing the issues to my attention, and I record my gratitude to the hon. Member for Blaydon (Mr. Anderson), who has put a huge amount of work into supporting sufferers of muscular dystrophy, and is chair of the all-party group on muscular dystrophy.

Let me set out the background. Muscular dystrophy covers many types of conditions involving complex and progressive multi-system disorders, including Duchenne muscular dystrophy, which afflicts young boys particularly, and of which there are estimated to be 100 cases in the United Kingdom, spinal muscular atrophy, myotonic dystrophy, limb girdle muscular dystrophy, facioscapulohumeral muscular dystrophy, myasthenia gravis, and more than 60 other related conditions.

Muscle diseases weaken and/or waste muscles, may affect the heart and lungs, and may cause lifelong disability and/or premature death. They may be inherited or acquired, and may affect people of all ages, backgrounds and nationalities. There are no cures, and without specialist multidisciplinary care most patients experience a further reduction in quality of life and, for some conditions, shortened life expectancy. Specialist multidisciplinary care is vital, as it improves quality of life and can dramatically extend life expectancy.

I was shocked to see data from the south-west showing that the mean age of death was 19 for patients with Duchenne muscular dystrophy. For similar patients in the north-east, the mean age of death was 30, and that age has since increased. That proves that it is possible for areas to make funding decisions that enable specialist care to be provided. That shocking statistic shows that we lag behind other European countries in the provision of specialist services, and it highlights the fact that in any civilised society such variances are unacceptable and are evidence of service failures that must be addressed with the utmost urgency.

I pay tribute to the parents of children who are diagnosed with muscular dystrophy and related conditions, and commend them on the way in which they have campaigned for improvements in their children’s quality of life. I recently saw a moving short film produced by the Rosenfeld parents about their son—I believe that the Minister is aware of it—showing how hard it is for parents of children who are suffering from that type of muscular dystrophy to contemplate their child’s life ending prematurely before their life is extinguished.

Neuromuscular specialist consultants need to be part of a multidisciplinary team with a specialist physiotherapist, a neuromuscular care adviser, and good links to respiratory  clinicians, cardiologists, speech and language therapists, orthotists, rehab consultants, geneticists, orthopaedic surgeons, and occupational therapists.

I want to focus today on specialist care for sufferers in the west midlands, but I hope that the debate will go some way towards encouraging other regions to reconsider how their care services meet the needs of sufferers. I was recently invited to attend a meeting of the West Midlands Muscle Group in Cheswick Green in my constituency. There, I met Stuart Reid, who is in his late 20s and is affected by Duchenne muscular dystrophy. He is an eloquent speaker, given all the disabilities that he must overcome, and gave oral evidence to the all-party group’s inquiry on national specialist care. I was shocked to learn from Stuart and others how the west midlands fares in comparison with other areas.

The west midlands is fortunate to have a number of dedicated and hard-working neuromuscular clinicians, including Dr. Ros Quinlivan, Dr. Helen Roper, Dr. John Winer and Dr. Nick Davies. It also has accomplished respiratory clinicians, such as Dr. Dev Banerjee and Dr. Martin Allen. However, the level of care in the west midlands is sub-optimal, compared with that in other regions. The service is overstretched, unco-ordinated, and reliant on charitable funding and the good will of the lead clinicians. Clinics are overbooked, and patients may have a long wait for follow-up appointments, despite only 50 per cent. of patients receiving specialist care.

Patients face massive problems in trying to access ongoing physiotherapy, hydrotherapy or psychological support. There are also issues with accessing speech and language therapy, and with funding for essential respiratory equipment. Some participants at the public meeting told me that they had to travel as far as Chester for specialist help.

Vitally, wheelchair services in the region are far worse than in many other parts of the country. Birmingham East and North primary care trust and South Birmingham primary care trust have admitted that children with muscular dystrophy must wait an average of 18 months, which is a long time in the life of a child suffering from such a condition, to receive a powered chair. That compares with a national average wait of 19 weeks. A wheelchair for a child with muscular dystrophy is far more than a mobility aid. In the short film that I watched about the Rosenfelds’ son, Gavriel, it was clear that the wheelchair plays an important role in aiding breathing and supporting the spine.

Children and adults who are affected by these rare and progressive conditions are competing for equipment with patients with injuries such as leg fractures. Some children and adults with neuromuscular conditions are considered to have profound disabilities, and the assessment process requires greater knowledge and expertise than is often available in local wheelchair services. That may mean that people are not being properly assessed or offered appropriate equipment. There seems to be a process logjam in the provision of wheelchair services in the west midlands that goes wider than sufferers of muscular dystrophy. I hope that the Minister will help me to unscramble that logjam.

For the 5,000 people in the west midlands with a neuromuscular condition, there is only one care adviser. It has been suggested that care advisers are vital, because they reduce pressure on consultants’ time by providing additional information and support in clinic, as well as advising patients about their overall well-being. Crucially, they recognise when a planned admission is needed, which reduces the cost and stress associated with unplanned admissions and emergencies. The south-west of England, which has a similar population, has five NHS-funded neuromuscular care advisers. I am an advocate of local primary care trusts being able to assess priorities in their regions, but that serves to show that the system in the west midlands could be better modelled.

Unplanned emergency admissions for neuromuscular patients are not only stressful and dangerous, but hugely costly. Work by the public health team at the West Midlands strategic health authority has shown that in the last financial year, my local Solihull care trust spent £271,746 on unplanned emergency admissions for local patients with muscular dystrophy and related neuromuscular conditions. Ours is a comparatively small PCT, with a population of 200,000, so that is a significant amount to spend on unplanned admissions. That is part of an overall £6.6 million spent in the region on unplanned emergency admissions for local patients with muscular dystrophy and related neuromuscular conditions.

The most costly emergency admissions are caused by respiratory crises, cardiac problems or falls. Although there will always be some emergency admissions for patients with such complex conditions, the figure can be greatly reduced. The Muscular Dystrophy Campaign has estimated that reducing it by only half would save PCTs more than £3 million. That is a very achievable target. One clinician in the region has had only a handful of emergency admissions in the past year out of a total of 850 patients. Clinicians’ evidence suggests that people are 20 times more likely to have an unplanned emergency admission if they do not receive specialist care.

It seems to me that encouraging pooled budgets would mean better and more tailored care for patients. A single assessment process, incorporating both health needs and social care needs, would be a more effective way of administering treatment. In such a process, an individual and their carer would be given the flexibility and empowerment to choose their providers. They should be able to exercise that flexibility across the social and health care divide. Many patients do not realise that they are crossing a divide between two departments, but I think that we all agree that it is high time that the system was joined up, so that people do not find that there is a crack as they drop down between the two.

In January, the 17 PCTs that make up the west midlands specialised commissioning group will have to decide whether to accept the recommendations of the regional neuromuscular services development group to develop a co-ordinated, planned specialist service for all patients affected by muscular dystrophy and related neuromuscular conditions. I strongly endorse local health authorities being able to take decisions for themselves and not having top-down approaches forced on them, so I welcome the fact that regions such as the north-east are providing the services deemed so necessary to sufferers. I encourage the west midlands service providers to work together to ensure that muscular dystrophy sufferers have access to the essential specialist care that it has been shown can extend their life expectancy and improve their quality of life. We know that multidisciplinary specialist care has worked for sufferers in other areas of the country, and we desperately need it in the west midlands.

I dedicate the debate to my courageous young constituent, Stuart, who has outlived the mean life expectancy for his condition and demonstrated that he has the courage to drive himself forward, keep going and even write a novel and come to give evidence in Parliament when, as he put it—rather poignantly—to me, “I really shouldn’t be here by now.”

13:43:00

Mr. David Anderson (Blaydon) (Lab)
It is a great pleasure to see you in the Chair, Mr. Sheridan. I congratulate the hon. Member for Meriden (Mrs. Spelman) on her contribution to a debate that is taking place across the country. Yes, there are problems in the west midlands, but I would not want anyone to get the idea that the west midlands is alone in that. I am the chair of the all-party muscular dystrophy group, and in August, after some seven months of intensive inquiries, we produced a report that brought together professionals working at the highest level in neuromuscular care, people doing day-to-day basic care work with those suffering from these conditions, and, in particular, the families taking care of people with these diseases. The truth is that we need real improvements throughout the country.

I shall give one example. The hon. Lady spoke about Duchenne muscular dystrophy. One hundred young boys will die this year—two a week—as a direct result of that disease. Because care is sporadic across the country, some will die in their teens. Thankfully, some will not die until their late 20s. That is a direct result of the differences in care. In Denmark, however, they will die in their mid-40s, so we have a long way to go before we can say that we are doing what is best.

The term “postcode lottery” has been used, but that is not how things work. We are talking about a question of luck, history and geography. If a person happens to live in a part of the country where someone decided, many years ago, to specialise in neurosurgery, they might just have access to a team of people who happen to be linking up with another group of people who are developing work on, for example, sickle-cell disease and similar conditions.

That is not good enough. We need a strategic approach and we need the development, throughout the country, of specialised centres for everyone. Particularly in places such as the south-west, people are travelling ridiculously long distances to receive the treatment that they need. Indeed, the distance that they are travelling is making their condition worse. That is not the care that they should be receiving.

The all-party group is linking up with the specialised commissioning groups. This morning we had a meeting. We already have reports from 13, I think, of the groups on where they are in what they are trying to do. Some are positive, some are negative and some are neutral. We will not let go; we will continue campaigning with them to make the issue a priority. There is huge public support for the issue. We launched our report on 24 August, and in the days that followed, we had at least 200 pieces of coverage across the media, from BBC 1 through to local press and the specialist press. There is huge interest in the issue, because what is happening could be avoided.

13:46:00

The Parliamentary Under-Secretary of State for Health (Ann Keen)
I warmly congratulate the hon. Member for Meriden (Mrs. Spelman) on securing this extremely important debate and, in particular, on the way in which she talked about her own family and, of course, Stuart, who is now very much in my mind. I know that public discussion is particularly important to families coping with the realities of muscular dystrophy, in that it raises awareness of the issues that they face. I am grateful to the hon. Lady for giving the House the opportunity to focus on the impact of muscular dystrophy on their lives.

The hon. Lady spoke eloquently about muscular dystrophy and the devastating effect that it can have on people living with the condition, their families and those who care for them. In fact, both she and my hon. Friend the Member for Blaydon (Mr. Anderson) raised the issue of the ages to which people with muscular dystrophy live and the differences in those ages. I cannot add to the description given. I should like instead to concentrate on the main thrust of the hon. Lady’s speech by responding to her concerns and those of the all-party group that the national health service is failing the thousands of people affected by this condition.

At this point, I pay tribute to my hon. Friend the Member for Blaydon, who is the chair of the all-party muscular dystrophy group, and to the other members of the group for their far-reaching inquiry into access to specialist neuromuscular care. I apologise for not being present at the meeting today: I was speaking at a conference this morning. That inquiry and its subsequent report have raised a number of important issues for my Department to reflect and act on. It highlights the shortcomings in existing services and makes it clear that we need to do more to improve services for people living with muscular dystrophy.

The Walton report, which is the report from the inquiry, is sadly only one of a series of hard-hitting reports to have highlighted the significant variations in standards of care that still exist for those living in some areas of England and Wales. It is totally unacceptable that people with muscular dystrophy are not being offered the full range of care and support that they need. From my many years of experience as a nurse and community nurse before I entered the House, I know the tremendous impact that conditions such as muscular dystrophy can have on patients and their families. I will not accept excuses that the problem lies with competing priorities or with the availability of resources.

I want to respond positively on that range of issues. Let me be clear: we want to ensure that people with this condition live as well as possible for as long as possible and that they do not just live with it—suffer it—but have a real life.

In 2005, the Government published the national service framework for long-term conditions, which is a 10-year plan that addresses the very issues highlighted in the report: the inequalities in access, the lack of integrated service provision, the work force shortages and the variable quality of care across the country. The NSF is based on the core NHS values of modernisation, breaking down professional boundaries and creating partnerships between agencies.

Achieving the standards set out in the NSF is clearly a huge challenge for some local providers, although others meet that challenge and tackle problems forcefully. There are no central targets or milestones, so it will be for people working at the front line, who best understand local needs, to decide local priorities, and it will be for commissioners to commission appropriate services.

Mrs. Spelman
I am listening carefully to the Minister, but does she agree that the situation that she describes is precisely the problem? Muscular dystrophy does not have a target or a priority attached to it in this system of targets, so there is a danger that it will be given lower priority when providers and commissioners try to decide how to make use of resources.

Ann Keen
I am a fan of targets and I am pleased that the hon. Lady is, too. As I go on, perhaps I could offer suggestions on the issues that she raises.

As we approach the mid-point of the NSF’s 10-year implementation period, it is fair to say that there is no comprehensive and detailed picture of the extent to which the NSF has been implemented or of the difference that it is making to the lives of people with neurological conditions. However, there are many examples of good, innovative practice, and the successful implementation of the NSF over the next five years will depend on our ability to identify and disseminate that good practice, although the NHS is not always good at looking at good practice and learning from it. We therefore need to identify the champions who can support the weaker services.

We have commissioned a mid-point review in 2010 to show what progress has been made towards implementation, to identify what works and why, and to lead to the adoption of good practice elsewhere. That will help us all to make better decisions in the design and delivery of services.

The all-party group and others see the development and implementation of clinical standards and guidance as a means to drive up quality and secure improvements. The National Institute for Health and Clinical Excellence is an independent body, which welcomes suggestions for future guidance from a wide range of sources, including health care and public health professionals, patients, carers and the general public. Health professionals are free to use their clinical judgment and any national and international best practice guidance to develop appropriate health and social care services to meet the needs of those living with muscular dystrophy.

As the hon. Lady recognised, the new NHS is locally driven and looks outwards, not upwards. It is designed dramatically to improve the quality of care and the value that we get from our resources. Strengthening commissioning is, of course, at the heart of delivering that agenda, and that is where we have been concentrating our efforts to provide leadership on this crucial issue.

It is important that I commend the West Midlands strategic health authority and the West Midlands specialised commissioning group. In response to the Walton report, they are undertaking a review of muscular dystrophy and related neuromuscular services to produce proposals to allow PCTs to improve services. I say to the hon. Lady and my hon. Friend that I will now urge the regional specialist commissioners to liaise with the all-party group and I will ask the national team to co-ordinate. We are still learning about commissioning, and some people are more advanced than others.

The hon. Lady mentioned emergency admissions, and I am asking for a special study to look at the issue. As a former community practitioner, I believe that we will avoid emergency admissions if we invest in community care and a multidisciplinary team so that they can be as effective as possible. That requires us to have really positive champions and real clinical leadership.

Mr. David Anderson
This morning, the all-party group heard evidence from a specialist working in the west midlands about the practical, day-to-day problems that arise when someone with one of these diseases goes into a normal emergency service because they have fallen over and broken their leg or because they have a headache, but they end up being kept in for much longer than they need to be because their disease is not recognised. The Minister mentioned resources, but by speaking to people on the ground we can see that money can be saved by giving people direct access to the specialist services that they need, and that money can be reinvested in looking after them properly.

Ann Keen
I absolutely agree with my hon. Friend, and the point was made clear to me when I had a meeting with young people and their relatives in my office some time ago. It is clear that we still have a lot of work to do on getting best practice out to all clinicians.

The group overseeing the review includes service users, carers, clinicians and the Muscular Dystrophy Campaign. I understand that their work will draw on a substantial amount of the best practice that the Muscular Dystrophy Campaign has already promoted in the west midlands. I can tell the hon. Lady that the moving film I saw in my office made it clear that access to wheelchairs is absolutely crucial. I have been informed that the review has also looked at wheelchair access and that it will recommend that wheelchair provision should be a specialised service. It will also recommend that there should be wider collaboration between PCTs on the issue of wheelchairs, and that wheelchairs should be included in the planning and commissioning of provision for those with neuromuscular conditions.

Access to a specialist multidisciplinary service is key and can, as the hon. Lady demonstrated, significantly increase life expectancy as a result of overall care monitoring and the maintenance of services. Again, the appropriate commissioning of services is vital. I have asked the national team, through the deputy director, Steve Collins, to work with the Muscular Dystrophy Campaign. On best practice commissioning, a workshop in the new year would be very helpful, and Steve Collins, who is with me today, is keen to have one.

Nationally, the long-term conditions delivery and support team has been supporting improvements to commissioning for the services that we are discussing. Earlier this year, the team delivered a number of regional “Levers for Change” events to spread understanding  about the different mechanisms that can be used to promote implementation of the national service framework and, where appropriate, of NICE guidance.

Long-term neurological conditions, and particularly the NSF’s quality requirements, will be referenced in a commissioning guide, which is under development as part of the wider long-term conditions agenda. I have to stress again, however, that one reason for the variations in local services is the lack of clinical leadership on this issue. We are working alongside those involved with long-term conditions to pull together all our regional clinical champions, who will work with local NHS organisations.

I am conscious of the time, so I want to tell the hon. Lady and my hon. Friend of the Prime Minister’s commission on the future of nursing and midwifery. I am pleased that my profession of nursing is always at the forefront when carers and users want specialist nurses. Specialist nurses can have the time and commitment to give families, and that is one of the key issues that the commission is looking at.

People with muscular dystrophy and their families are concerned about access to new drugs and treatments, and it is absolutely understandable that they want potential treatments to become available as soon as possible. We need to ensure that the quality, safety and efficiency of any potential treatment are not in doubt. We are a world leader in health research, and I congratulate our scientists, who have done so much for those with this disease.

I cannot conclude without acknowledging and thanking the all-party group for the Walton report. I must also tell Stuart, whose story has touched me today, that we will do our very best and that we will continue to work to bring about improvements for people living with muscular dystrophy.

Question put and agreed to.

14:00:00

Sitting adjourned.