Commons Chamber

 House of Commons

Tuesday 17 July 2007

The House met at half-past Two o’clock

Prayers

[Mr. Speaker in the Chair]

private business

London Local Authorities Bill [Lords]

Read the Third time, and passed, with amendments.

Oral Answers to Questions

Transport

The Secretary of State was asked—

Employment (Former Mining Communities)

Jeff Ennis (Barnsley, East and Mexborough) (Lab)
1. What steps she proposes to take to improve transport services to enable better access to jobs for people in former mining communities.

The Minister of State, Department for Transport  (Ms Rosie Winterton)
Local transport authorities in former mining areas have made substantial investment to address local regeneration objectives, including enabling better access to jobs through new roads, improvements to public transport and facilities for walking and cycling.

Jeff Ennis
I welcome my right hon. Friend to her new position in the Government. Is she aware of the issue of access to jobs in the Dearne valley project, which is part funded by the housing market renewal programme? It is creating greater opportunities for access to jobs and services in the Dearne and South Yorkshire area in general. Does she agree that future housing development and housing regeneration projects have to go hand in hand with greater accessibility planning at their core?

Ms Winterton
I thank my hon. Friend for his kind welcome and I acknowledge his interest in the subject, which is extremely important for the South Yorkshire area. I read his speech at a conference in March, in which he set out the importance of transport to enable people to get to their jobs while also highlighting the importance of housing development. In preparing local transport plans, local authorities have to look, particularly now, at how disadvantaged people might get extra services and ensure that they plan public transport accordingly. That is exactly in line with what my hon. Friend said and it is particularly important for former mining areas like ours.

Mr. James Gray (North Wiltshire) (Con)
Corsham in my constituency is very much a mining community, having had 13 stone mines, most of which—bar one—have now been closed. Sadly, Dr. Beeching closed our railway station. That creates a problem for new development in the town, particularly by the Ministry of Defence, which is opening a £1 billion new centre in Corsham. We badly need a new station as so many people have to travel by car. Will the Minister join her predecessor in supporting our venture to have a new station in the town of Corsham?

Ms Winterton
I would be most interested to hear more about the plans for such a local station. The hon. Gentleman is right to say that, in planning well in advance, it is important to look at the integration of transport. Where we have railway stations, we need to ensure that they fit in with local bus transport plans and people’s driving habits, for example.

Mary Creagh (Wakefield) (Lab)
I, too, welcome my right hon. Friend to her new role in the Government. I would like to raise the issue of interchangeability. We are lucky to have the Penistone line and the Denby Dale station, but unfortunately the trains tend to arrive and leave five minutes before and after the bus arrives, bringing people from Wakefield and Holmfirth. That is a critical issue for people trying to commute. We have had huge problems and the parish council has written to me about that and other bus services being taken away in my rural areas. Will my right hon. Friend look into this and try to get some sense and heads knocked together on the problem?

Ms Winterton
My hon. Friend is right. If we are to succeed in getting more people on to public transport, it is absolutely right to look at how we achieve proper integration. We want local authorities to look at all modes of travel, particularly through local transport plans, and to ensure that, if necessary, they sit down with the train companies and bus operators to put forward people’s travel patterns. Frankly, it is to everyone’s benefit if they can get that sort of planning right.

Coventry Airport

Mr. Andrew Robathan (Blaby) (Con)
2. If she will make a statement on the future use of Coventry airport.

The Parliamentary Under-Secretary of State for Transport (Jim Fitzpatrick)
The future use of Coventry airport is a commercial matter for the airport operator.

Mr. Robathan
I welcome the Minister to his new role—I am quite certain that he will enjoy it—and thank him for that rather opaque statement. May I press him further? Many of my constituents are very concerned by a perceived increase in the number of aircraft; they appear particularly to be flying over the Lutterworth area much more. Many others believe that an expansion of Coventry airport in an area of high population would be unwise. Should any plans to expand the airport come before him, would he please ensure that they go out for the maximum possible consultation?

Jim Fitzpatrick
I am sure that I can give that assurance and I am grateful for the hon. Gentleman’s kind words. As he knows, Coventry airport serves a specialist role within the region with a mix of traffic. The 2003 air transport White Paper concluded that the airport could continue to perform that role “within existing constraints”. In the light of our conclusions on capacity elsewhere in the midlands and potential surface access and environmental and airspace constraints, the White Paper did not envisage that any significant further development beyond the current level of passenger throughput would be appropriate.

Keith Vaz (Leicester, East) (Lab)
I agree with the hon. Member for Blaby (Mr. Robathan). The situation relating to Leicester and Leicestershire has become much worse, and any expansion of Coventry will have a serious effect on the environment in my constituency. The best place in which to expand services is Birmingham airport. Will the Minister bear that in mind if he makes any decisions on the matter?

Jim Fitzpatrick
I can only repeat the assurances that I gave the hon. Member for Blaby about the proposals for Coventry and our view of capacity elsewhere in the midlands. The White Paper “The Future of Air Transport”, published in 2003, sets out the strategic framework for the next 30 years. As my right hon. Friend knows, it aims to create a balance between the economic importance of aviation and environmental and other considerations.

Jeremy Wright (Rugby and Kenilworth) (Con)
The Secretary of State’s recent decision not to permit the development of an extended passenger terminal at Coventry airport has been welcomed by many of my constituents who live very near the airport, but one of the difficulties experienced during the lengthy planning inquiry was that Warwick district council had to bear the financial burden of dealing with the matter, in competition with an airline company with extremely deep pockets. Will the Minister consider—in general terms—ways in which in we can help local authorities to deal with substantial planning inquiries of this kind?

Jim Fitzpatrick
That is a fair point, but when planning issues such as that arise, expenditure by local authorities is always necessary so that they can make representations. I can only tell the hon. Gentleman that the Department for Communities and Local Government always listens to representations made by any local authority in respect of the annual settlement—which, as he knows, has been growing over the past 10 years, and will doubtless continue to grow—and reassure him that his local authority’s representations will be taken into account at the appropriate time.

Humber Bridge Board

Shona McIsaac (Cleethorpes) (Lab)
3. When she last had discussions with the Humber bridge board.

The Minister of State, Department for Transport  (Ms Rosie Winterton)
Officials from my Department have had frequent and regular discussions with the Humber bridge board on a range of issues. The most recent discussions took place on 19 June, on the restructuring of the Humber bridge debt.

Shona McIsaac
I thank my right hon. Friend for her answer, and welcome her to her new position. I appreciate that the debt has been restructured, but will she confirm that that means that the board will retain more money, which could potentially be invested in local transport initiatives such as concessions for people travelling to Hull hospitals for cancer treatment?

Ms Winterton
I congratulate my hon. Friend on all the work that she has done in this area, not least with the rather splendid Bill that she promoted some time ago.

It is for the Humber bridge board to decide what to do with the £16.5 million or so that is available following the debt restructuring. If the board wanted to offer concessionary fares we would certainly consider its proposals, but we would have to be assured that it could meet its financial obligations. My hon. Friend might like to consider whether local health authorities would be interested in working with the board to enable people to be transported to hospital.

Local Bus Services

Mr. Khalid Mahmood (Birmingham, Perry Barr) (Lab)
4. What arrangements she plans to make to give local authorities a greater say over local bus services.

The Secretary of State for Transport (Ruth Kelly)
The draft Local Transport Bill proposes changes that will give local authorities stronger levers to improve bus services and work in partnership with bus operators. That includes making bus franchising a realistic option in areas where it is in the public interest for local authorities to take greater control of bus services.

Mr. Mahmood
I welcome the Secretary of State to her new role. Will the draft Bill allow local councillors to determine local routes for their constituents to provide the better service that is needed in local areas?

Ruth Kelly
I can give my hon. Friend a firm assurance that that will be the case. It might be made possible in a number of ways, including a voluntary partnership between a local authority and a bus operator. If the authority so chose, the arrangement could be put on a statutory basis. Alternatively, quality contracts—a form of bus franchising—would enable local authorities to have much more control over bus services. Behind all that is the idea that passengers must come first, and that local authorities must seek the powers that they need in order to ensure that passengers receive the best possible service.

Dan Rogerson (North Cornwall) (LD)
In investigating the furtherance of bus travel, will the Secretary of State revisit the effect on rural transport of limiting the length of bus journeys? Many rural passengers nowadays have to interrupt their journeys and change unnecessarily because of the new regulations on the length of a bus journey before drivers and buses must be changed.

Ruth Kelly
I certainly will do that. The powers we propose under the draft Local Transport Bill will enable local authorities to do as they see fit by working with the bus operator companies to put in place not only routes but frequencies and to determine punctuality and potentially the fares charged. Those powers will go a long way towards making sure that passengers get the facilities that they need. Also, community transport in rural areas will become more viable as it is made easier for there to be buses of different sizes and for drivers to be hired to operate them.

Ms Angela C. Smith (Sheffield, Hillsborough) (Lab)
I think that all Labour Members welcome the Bill’s inclusion in the draft legislative programme, but will my right hon. Friend address concerns that the process set out in the Bill for franchising bus services is too long, especially given the falling levels of bus patronage in metropolitan areas?

Ruth Kelly
I understand that that is a concern, particularly in Sheffield. My right hon. Friend the Minister of State will travel to Sheffield to meet people and discuss their concerns. However, I hope that my hon. Friend realises—as the local authority in Sheffield does—that our proposals will lead to the biggest shake-up in bus services for 20 years and that we are lowering the hurdle by making it much easier for local authorities to take the powers they need. I know that Sheffield is already working towards having a quality contract. We must make going down that route as easy as possible. Under the proposals, we envisage that there will be a timetable of about 14 to 20 months for a quality contract to be assured, which is similar to the length of time that a local authority would usually in any event want to spend making sure that it had got its proposals right. My right hon. Friend the Minister of State will be delighted to discuss the proposals not only with my hon. Friend but with the local authority.

Adam Price (Carmarthen, East and Dinefwr) (PC)
Will the draft Bill include a proposal for a separate traffic commissioner for Wales so that we can finally end the anomaly of the regulation of bus services in Wales being based in Birmingham? Although it is a splendid city in every respect, it is hardly an appropriate vantage point from which to make decisions on transport in Wales.

Ruth Kelly
I hear the hon. Gentleman’s enthusiasm for the return of powers to Wales, but the important point to make is that traffic commissioners must have the powers that they need to hold both bus operators and local authorities to account—and the Welsh Assembly thereto, where appropriate—in order to make sure that buses run on time and serve people well. As the hon. Gentleman knows, we will propose reforms to the traffic commissioner body. He will have to wait for the consultation exercise to be published, but I hear what he says on this matter.

Graham Stringer (Manchester, Blackley) (Lab)
The Confederation of Passenger Transport UK has boasted that it has more influence on bus policy than MPs or local government, and we know from today’s edition of The Times that it has influence in the other place. Will my right hon. Friend check the 4,000 passes to the Department for Transport and assure me that the CPT and its members do not have undue influence in that Department?

Ruth Kelly
I would be delighted to speak to my hon. Friend and any other Member who has concerns about bus policy or its operation at local authority or city level. My right hon. Friend the Minister of State is travelling not only to Sheffield but around the country to meet people who have particular concerns, and I am sure that she would be happy to discuss such matters with my hon. Friend.

Andrew Gwynne (Denton and Reddish) (Lab)
I welcome my right hon. Friend the Secretary of State to her new Government post. If we are to accept the concept of road pricing, those areas making bids to the transport innovation fund must offer better co-ordination and planning of the bus network. What assurances can my right hon. Friend give that, if Manchester’s bid proceeds, the Greater Manchester passenger transport executive will have the powers it needs?

Ruth Kelly
Of course, I will have to look at the bid from Greater Manchester when it comes to my Department for examination, but the principle is that if a local authority or a city wants to pursue road pricing, it is right that the public services, and public transport in particular, work well and in an integrated fashion. Local authorities must have the powers that they need, especially over buses, to make that possible and they must also have the funding to put in place transport that works to serve the needs of the local population.

Birmingham New Street

Mark Williams (Ceredigion) (LD)
5. What progress has been made in reducing train congestion at Birmingham New Street station.

The Secretary of State for Transport (Ruth Kelly)
Network Rail and Birmingham city council have been developing a scheme for the redevelopment of the station. My Department is assessing whether it addresses future needs and represents value for money.

Mark Williams
I am grateful to the Secretary of State for that response. She will be aware that Arriva Trains Wales, which links mid and west Wales and Shropshire with Birmingham, has frequently had to terminate services at Wolverhampton because of lack of platform capacity at Birmingham New Street station. In view of what she has said about the discussions between Birmingham city council and Network Rail, can she confirm whether platform capacity, as opposed to the necessary improvement of surroundings, will be a part of the discussions? There is a great need for that, because many of my constituents think that they receive a lamentable service.

Ruth Kelly
I sympathise with the hon. Gentleman’s constituents. I know that there have been reliability problems with the Arriva Trains Wales service and I urge him to take up those concerns with the Welsh Assembly Government, because ultimately the Aberystwyth line is their responsibility. He mentions capacity at Birmingham New Street station, and that is an issue with which I am familiar. Clearly, capacity will be one of the major priorities of the forthcoming rail White Paper and, given the central importance of Birmingham New Street to the rail network, it will clearly be one of the issues in my mind as I go forward.

Richard Burden (Birmingham, Northfield) (Lab)
I also welcome my right hon. Friend to her new post. From the fact that this question comes from outside Birmingham, she will be aware of the importance of the regeneration of New Street station nationally and not simply to the city of Birmingham and the west midlands. She mentioned discussions: does she need any further information from any of the partners involved to convince her just how vital that project is to the country as well as to the region?

Ruth Kelly
I thank my hon. Friend for his contribution. I know that he, my hon. Friend the Member for Birmingham, Edgbaston (Ms Stuart) and others in the region have been championing the cause of New Street station, not just in terms of passenger capacity, which is clearly needed, but because of the regeneration potential of the plans. My Department has been liaising with Birmingham city council and challenging it to come up with plans that represent clear value for money.

We are currently in a process of iteration, and the local council still has significant work to do to prove its case. I can pledge to my hon. Friend that I will give the issue my close attention and focus especially on the value for money case, while understanding that value for money will include any potential regeneration benefits.

Mr. Speaker
Mr. Philip Hammond.

Hon. Members
Stephen.

Stephen Hammond (Wimbledon) (Con)
I welcome the right hon. Lady to her new role and wish her success in curing the nation’s transport problems. Seven years ago, in the 10-year plan, the Government promised to tackle the very bottlenecks that she has been talking about, but they persist. The real progress in reducing train congestion and increasing capacity at New Street will be secured by the £500 million station upgrade that we all expected to hear in the high level output statement, which was expected yesterday. Was the HLOS delayed because of the emerging crisis in the Underground public-private partnership or the embarrassment caused to the Government by First Great Western and TravelWatch’s performance review at the weekend? When will the Government announce something to help west midlands commuters—

Mr. Speaker
Order. The hon. Gentleman is entitled only to one supplementary question, even if I get his name wrong.

Ruth Kelly
I welcome the hon. Gentleman to his post and I congratulate him on his creative efforts in his questioning. I am sorry that they were not more successful. He is right to say that we have to think about Birmingham New Street station and the capacity issues. I understand that the issues include pedestrian access as well as rail connections outside the station.

One thing that I have not mentioned to colleagues so far is that the recent award of the Cross Country franchise will, I hope, make a significant difference to reliability across the whole network, including at Birmingham New Street station. If trains on that franchise are able to run on time and carry more passengers, that will also help all other trains leaving and arriving at that station.

Mr. Brian Jenkins (Tamworth) (Lab)
I should like to welcome my right hon. Friend to her new post, and I am glad that she is aware of the congestion problems in the west midlands, especially at New Street. The proposed redevelopment, whenever it takes place, will not help that problem, so will she speak to the rail operators with a view to taking some of the congestion away from the station? Tamworth is the crossroads between the main lines to the west coast and the north-east. Will she consider making it a hub station, as that would reduce people’s need to go into New Street during the reconstruction period?

Ruth Kelly
I am sure that my hon. Friend will be pleased to know that I plan to meet the train operating companies next week, when we will discuss their plans to tackle capacity problems at stations around the country. It has been made plain already that many passengers are forced to change at Birmingham New Street station, and that different options are needed. One of the merits of the recent award of the Cross Country franchise will be that fewer passengers will be forced to change at New Street station, but we keep such matters under constant review and they will inform the contents of the rail White Paper to be published shortly.

Rail Fare Regulation

Sandra Gidley (Romsey) (LD)
6. What recent discussions she has had with South West Trains on the regulation of rail fares.

The Parliamentary Under-Secretary of State for Transport (Mr. Tom Harris)
There have been no discussions about either the scope or the level of fares regulation. There has been some discussion about the forthcoming investment in modern smartcard ticketing, which may require fares regulation procedures to be changed.

Sandra Gidley
In May this year, South West Trains hiked up prices by 20 per cent. for passengers from Winchester and Southampton who arrive in London between 10 am and 12. No such increases were introduced for people travelling from Basingstoke and Reading, where there is competition from First Great Western. What can the Minister do to prevent companies such as South West Trains from fleecing passengers on routes where there is a monopoly franchise?

Mr. Harris
I of course sympathise with those who find that their fares have gone up by a significant amount. I am sure that the hon. Lady will understand that the Government can intervene in such matters only by extending the scope of regulation. However, there would inevitably be a cost to the public purse, at a time when many more demands are being made on it, both in the rail industry and elsewhere.

Susan Kramer (Richmond Park) (LD)
I welcome the Minister to his post, not least because he provides an element of gender balance in a Department that is becoming very much a female province in this House. The hike in fares to which my hon. Friend the Member for Romsey (Sandra Gidley) referred is not unique to South West Trains, but it runs contrary to the original plan that the Association of Train Operating Companies would try to attract more passengers by providing a range of options for off-peak travel. Will he therefore consider looking at the model recently adopted by Transport for London? It has decided to take the revenue risk involved in running the north London line franchise, in order to get much more integrated travel and to achieve the goal of getting people to transfer from road to rail, rather than from rail to road.

Mr. Harris
I welcome the hon. Lady to her new post and point out that, having been there for 10 months, I am now the veteran Minister in the Department for Transport. The price of a regulated fare in Britain is now 2 per cent. lower in real terms than it was 10 years ago. As for innovative ways to get people on to trains, she will be aware that South West Trains has instituted the so-called Megatrain fares scheme that enables people to buy tickets at very low prices. I do not believe that we should change the current structure of the franchising system: there has been enough change in the industry over the past 10 or 15 years, and the system is delivering for passengers.

Mrs. Theresa Villiers (Chipping Barnet) (Con)
I welcome the whole ministerial team to their roles. Will the Minister tell us what representations he received from South West Trains about the impact on fares when the DFT set the franchise premium payments up to 2014? Has he made any estimation of how much fares will have to increase to fund the increased premium payments set by his Department?

Mr. Harris
In welcoming the hon. Lady to her new position as shadow Transport Secretary, I express the hope that she will not go down the cul-de-sac pursued by her predecessor in suggesting that as long as there is a public subsidy to train operating companies all is well and good but that we should never allow a premium to be paid by train operating companies back to the public purse. South West Trains made the Department aware that some off-peak, unregulated fares would have a higher than inflation increase, but even if the company had not told us that, the fact is that as the fares are unregulated we would not be in a position to change its mind. Unregulated fares do exactly what it says on the tin.

Mrs. Villiers
Is not the reality that the Minister and his Department are responsible for ratcheting up fares because of the ever-increasing premium payments they demand from train operating companies? South West Trains will be paying almost £250 million a year in premium payments by 2014. In total, the five highest value franchises will be paying well over £1 billion in premium payments by 2014—a more than tenfold increase. Is not the Secretary of State using the franchise system to price people off the railways to deal with the overcrowding problems that the Government have wholly failed to tackle?

Mr. Harris
The hon. Lady has clearly decided at an early stage to ignore my advice. However, as I told her predecessor, the Department for Transport at no point specifies any level of premium, or indeed any level of subsidy. If the hon. Lady is to stay in her post for any length of time, it may help her to become slightly more informed about the franchising process. I and my officials would be more than happy to meet her and talk her all the way through the process from the early points, so that she can understand exactly how a franchise is let.

Road Infrastructure (North-West)

Sir Nicholas Winterton (Macclesfield) (Con)
7. If she will make it a departmental priority to improve the road infrastructure in the north-west.

The Minister of State, Department for Transport  (Ms Rosie Winterton)
The north-west will receive £345 million over the next three years for local authority road and public transport projects and Highways Agency major schemes. We will continue to take advice from the region on how investment should be prioritised.

Sir Nicholas Winterton
Is the Minister aware that the letter from the previous Under-Secretary in her Department to me and others relating to the south-east Manchester multi-modal recommendation has created immense anger among all local authorities—Labour, Liberal and Conservative—in Cheshire, Macclesfield and Greater Manchester? It really is about time that areas such as Cheshire and Macclesfield, as well as Greater Manchester, had a fairer distribution of money for road improvements up to 2022. Will the Minister receive a delegation from me, including Members from all parties, to discuss the matter?

Ms Winterton
I have read the letter that the Under-Secretary sent to Members of Parliament in which the offer was made that a meeting would be arranged with local councils and Department for Transport officials. I believe that meeting will be on 23 July. My hon. Friend the Member for Stockport (Ann Coffey) has already approached me about meeting a delegation of MPs and I am more than happy to do so, but I suggest that we wait until after the meeting on Monday, in order to see what is resolved there.

Ann Coffey (Stockport) (Lab)
I, too, welcome my right hon. Friend to her new job, and I very much welcome the offer she has made to meet all Members of Parliament with an interest in the SEMMS relief road. Will she consider all the options for progressing the road, which is vital to relieving congestion on the A6 in my constituency, including building part or all of it as a toll road?

Ms Rosie Winterton
I can assure my hon. Friend that we are certainly committed to working in close collaboration with the local authorities to look at all the possible funding options. As I said, when the meeting on Monday has taken place, we should sit down and look at the various proposals. I understand her point about toll roads. I hope that we will be able to take this matter forward. As I am sure all right hon. and hon. Members are aware, the cost of the scheme has escalated—looking at some of the funding options—up to £1 billion. We have to recognise that we need to explore the different options very closely.

Ann Winterton (Congleton) (Con)
Is the Minister aware that the recommendations by the regional authorities have caused my constituents great anger? They mean that we have very little infrastructure investment in county roads such as the A34, which runs from Manchester and is a major commuter road south through Congleton to Stoke-on-Trent. When the long-overdue Alderley Edge bypass is completed, that will merely decant vast amounts of traffic into areas in and around the town of Congleton. When are we going to get a bypass, and when will some money be spent in rural areas, rather than just in the large metropolitan areas?

Ms Rosie Winterton
It is important to recognise that the north-west region has a 10-year regional funding allocation of £1.245 billion, and that local transport funding has doubled in the past seven years. However, it is also important to recognise that the Department takes advice from the region about the region’s priorities, which is the right approach. We will continue discussions, but it is important to remember that that is the principle on which we work.

Mr. Neil Turner (Wigan) (Lab)
The Minister will be aware that the north-west has enjoyed unprecedented growth over the past 10 years, yet still lags behind the national average. One of the reasons for that is our poor road infrastructure. May I invite the Minister to meet the Northwest Development Agency and see all the plans that we have in the north-west, and—I hope—put some more money into our infrastructure, so that we can have economic growth at the same level as the rest of the country?

Ms Rosie Winterton
My hon. Friend is right to say that transport infrastructure is an important part of economic growth, particularly at the regional level. I thank him for his kind invitation. I would be more than happy to meet him, and perhaps the regional development agency, to discuss some of the issues that are clearly of such great interest to Members.

Road Safety

Paul Flynn (Newport, West) (Lab)
8. What plans she has for measures to reduce the number and severity of injuries arising from collisions between vehicles and pedestrians.

The Parliamentary Under-Secretary of State for Transport (Jim Fitzpatrick)
The Government, local authorities and road safety organisations are working to reduce pedestrian casualties through education, engineering and enforcement. From October 2005, passenger cars and light vans are required to provide protection for pedestrians in their design. This is the first legislation of its kind. A second stage of requirements will apply from 2010.

Paul Flynn
The Government are to be congratulated on their part in the recent ban on the manufacture and sale of bull bars—what the Americans call killer grilles—the macho fashion accessories that concentrate and multiply the force of an accident at the level of a child’s head and vital organs. However, being a pedestrian is still twice as dangerous as travelling in a car. Have the Government any more plans to restrict the use of very heavy vehicles, particularly those with non-flexible fronts?

Jim Fitzpatrick
May I return the compliment and congratulate my hon. Friend on the campaigning he has done on this issue over a considerable time? The Government are serious about improving the safety of pedestrians and we made a significant contribution to the development of the European legislation that he mentioned, including the personal protection directive of 2003, the frontal protection systems directive of 2005, and the second phase of the personal protection directive of 2003, which will be introduced in 2010. My hon. Friend has contributed to ensuring that from 25 May 2007, new vehicles have had to be fitted with a frontal protection system approved under the directive, and that from the same date, any frontal protection system offered for sale as an accessory must be approved and carry an approval mark. We will continue to monitor these issues.

Mr. John Leech (Manchester, Withington) (LD)
Does the Minister agree that one of the most effective ways of reducing the number and severity of injuries is to reduce the default speed limit on lit urban roads to 20 mph?

Jim Fitzpatrick
That is an issue for local authorities to decide. We have given them the power to introduce reduced speed limits in areas where that is appropriate. The hon. Gentleman is well aware that the Government set out their road safety strategy in 2000 and indicated their targets for reducing the number of people killed and seriously injured by 2010, so it is lower than the average figures for 1994 to 1998. We are well on our way to meeting those targets, but we should not be complacent, because there are some differences in scale. We need to make sure that we press for a reduction in that number, and the speed restrictions that the hon. Gentleman requests can certainly play a part in our campaign.

Port Security

Patrick Mercer (Newark) (Con)
9. What steps she has taken to improve port security.

The Secretary of State for Transport (Ruth Kelly)
My Department works with the ports industry in implementing the international ship and port facility security code, which came into force in 2004. The code introduced new requirements, under which port facilities and ships must work to security plans, which set out the response measures that are to be taken in normal, heightened and exceptional security situations.

Patrick Mercer
I am very interested in the right hon. Lady’s response. Over the past few years, I have made it my business to visit a number of ports and consider their security. When I went to the extremely vulnerable port of Holyhead, I was particularly surprised to find that there were no Border and Immigration Agency or customs and excise officers present, and special branch officers were having to deputise for both. Why was that?

Ruth Kelly
I pay tribute to the work that the hon. Gentleman has done on this subject. I know that he is interested not just in port security, but in the security of our borders more generally, and it is right for me to acknowledge that work in the House. I hope that he will acknowledge that since 2004 security at ports has improved significantly. We monitor security at ports, but they are also independently audited by the EU. Since its last audit, it has said that results have been positive. However, if the hon. Gentleman says that it was not evident what was being done at a particular port, I will take it upon myself to go and examine the situation, or to make sure that it is examined. I will report back to him in writing with my findings.

Mrs. Gwyneth Dunwoody (Crewe and Nantwich) (Lab)
Is it not time that this country unified not only Customs and Excise, but the police forces responsible for aviation and those responsible for ports, and created a proper security system, capable of resisting the real threats posed to this country by terrorism?

Ruth Kelly
I thank my hon. Friend for her comments. It is absolutely right that we work together across Government to protect our borders in the most effective way possible. She will have followed closely the latest reorganisation of the Home Office, which means that it can concentrate on counter-terrorism. My Department, which has responsibility for transport, co-operates extremely closely with Home Office officials. On the front line, under the border management programme, we are making sure that the police, the Border and Immigration Agency, Her Majesty’s Revenue and Customs, and UKvisas work together to share information appropriately, and take action in specific locations as required. I hope that my hon. Friend will agree that that is a serious step forward in making sure that our borders are secure, because protecting our citizens must be one of the most fundamental duties of any Government.

Andrew Mackinlay (Thurrock) (Lab)
The Government are in denial on that point, and the hon. Member for Newark (Patrick Mercer) and my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) are absolutely correct. Is Project Cyclamen now working in all our container ports 24 hours a day? If not, why not?

Ruth Kelly
I have already set out how the security of our ports is enforced and audited, and the results are broadly positive. Clearly, the extent of the security measures taken at any port will depend on the threat level, and it will be determined accordingly—

Andrew Mackinlay
Cyclamen?

Ruth Kelly
As my hon. Friend has particularly mentioned Project Cyclamen, I will establish what the state of play is on that.

Andrew Mackinlay
And will my right hon. Friend come back to the House with that?

Ruth Kelly
I will write to my hon. Friend about it.

Andrew Mackinlay
No, no, come back to the House.

Mr. Speaker
Order.

Duchy of Lancaster

The Minister for the Cabinet Office and Chancellor of the Duchy of Lancaster was asked—

Social Exclusion (Adults)

Mr. Jim Devine (Livingston) (Lab)
19. What plans he has to tackle severe social exclusion among adults.

The Minister for the Cabinet Office (Edward Miliband)
Since 1997 social exclusion has fallen, but we need to do more, so we plan to tackle it through a focus on particular groups of people, such as ex-prisoners and those with mental health problems. Just as through “Every child matters” we have seen better local co-ordination for children’s services, so too through our work we will seek better local co-ordination for adults to tackle people’s multiple and complex needs.

Mr. Devine
I thank my right hon. Friend for that answer, and I welcome him to his new Department and his well-deserved promotion. As he knows, I worked in psychiatry, and people with mental illness are extremely difficult to place in the workplace, not least because of the prejudice of some employers. Can he reassure me that he will co-ordinate work through all Government agencies and the CBI to ensure that we get those people back in the workplace, which is not only good for their self-esteem, but is therapeutic, too?

Edward Miliband
My hon. Friend is absolutely right. In the past 10 years, our recognition of the role of mental health problems in society and the extent to which they affect employment and a range of other issues has increased a great deal. He is right, too, to say that we need to do more work with employers, and that is the focus of the review under way as part of the comprehensive spending review. As part of our employment programmes—this was recently emphasised in the pathways to work programme—we need to ensure that when people on incapacity benefit come to us with a set of problems their mental health problems are recognised. That needs to happen across the board if we are to tackle the problems that my hon. Friend identified.

John Bercow (Buckingham) (Con)
Is the right hon. Gentleman aware that at the last reckoning, no fewer than 2,063 young adults in Buckinghamshire, Oxfordshire and Milton Keynes suffered social exclusion by virtue of the fact that they were not in education, employment or training? Does he share my particular concern that 1,000 of those 2,063 people were in that position because of untreated speech, language and communication impairments? Will he give an undertaking to work across government to improve massively the quality and earliness of intervention, so that many of the problems that manifest themselves at a later stage, to such disadvantage to our society, can be avoided?

Edward Miliband
The hon. Gentleman makes his point extremely eloquently, and I know that he takes a personal interest in those issues. He is absolutely right about the importance of treating and addressing special needs issues early. If those needs are not addressed early—he raised the issue of individuals who are not in education, employment or training—they are not solved, and they come back to haunt those people for the rest of their lives. I will endeavour to work across government on those issues, and I am happy, too, to meet him to talk further about those and other issues.

Rosie Cooper (West Lancashire) (Lab)
In welcoming my right hon. Friend to his new position, may I ask whether he has seen the proposal from the Opposition about a transferable tax allowance, and—[Interruption.]

Mr. Speaker
Order. It is not for the Minister to discuss the Opposition’s policies. If the hon. Lady had phrased her question better, she might have got away with it.

Mr. Francis Maude (Horsham) (Con)
I congratulate the Chancellor of the Duchy of Lancaster and his colleagues on their appointments, and I look forward to many discussions at the Dispatch Box. The new Prime Minister said in the 1990s:

“We will reverse the gap between rich and poor that has affected our society.”

After 10 years in which the right hon. Gentleman had unparalleled powers as Chancellor of the Exchequer, with huge parliamentary majorities, is the Minister proud that today’s report by the Joseph Rowntree Foundation says that

“Britain is moving back towards levels of inequality in wealth and poverty last seen more than 40 years ago”?

Is not what is needed the sort of rigorous analysis undertaken by my right hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith) in the social justice report last week?

Edward Miliband
I thank the right hon. Gentleman for his welcome. Over the past two years, he has tried to make the Conservative party address seriously the issues of social exclusion and social justice. That is an uphill struggle, so he is to be congratulated. On his specific question about inequality—yes, it is a problem in our society, and we should all read and acknowledge the Rowntree report. I would point out, however, that its author, Danny Dorling, said today of the “poorest of the poor” that

“that group had actually reduced in size in the last ten years and it also became less geographically concentrated. And that almost certainly is due to Government policies”.

The hon. Gentleman is right: inequality is a big challenge that we face in our society, but I believe that on the basis of long-term investment—Sure Start and other things that we are doing—we will start to tackle it, and we should all acknowledge that. Finally, a transferable tax allowance will not help to tackle those issues, which is why the Labour party will not adopt that proposal.

Community and Voluntary Organisations

Ann Coffey (Stockport) (Lab)
20. What steps he is taking to support the work of small community organisations.

Anne Snelgrove (South Swindon) (Lab)
26. What plans he has to improve support for the work of small voluntary organisations.

The Parliamentary Secretary, Cabinet Office (Phil Hope)
A sustainable local voluntary sector is essential for vibrant communities. The Office of the Third Sector is introducing a new £80 million programme of small grants to support small community and voluntary organisations, and the community assets fund, with an additional £30 million, will make it easier for community groups to take on the management or ownership of assets.

Ann Coffey
Many small community and voluntary organisations in my constituency would benefit from, for example, an accountancy service that could do the books of several organisations, or from training to help them when they sit on partnership boards, so I welcome the Government’s recognition of that need through the funding that they have given to Capacitybuilders, but I am concerned that the funding does not always reach a very local level. Will my hon. Friend ensure that any future funding for building capacity benefits small organisations and helps them to develop the services that they need at local level?

Phil Hope
First, I commend my hon. Friend for the work that she does in championing the voluntary sector in her constituency. She is right. The £33 million ChangeUp funding programme, which funds local infrastructure organisations, allocates those funds. Allocations are made by an independent body called Capacitybuilders, and it is local consortiums that identify the local priorities. That is under review, and I will draw my hon. Friend’s concerns to their attention. I emphasise that we want to get financial help to the very small volunteer-led community groups as well, and the £80 million over four years in the new small grants programme will start to be allocated this financial year. Grants, from £250 up to £5,000, will be allocated to the smallest front-line community groups that make such a difference to the lives of our constituents.

Anne Snelgrove
Will the Minister join me in congratulating Voluntary Action Swindon on its 75th anniversary? It is good to hear what he said about small organisations. Will he give his full consideration to the request from the chief executive, Chris Lau, that the bidding process be made as simple as possible for small charities, which want and deserve access equal to that of larger charities to commissioning funds and the system?

Phil Hope
Many congratulations to Voluntary Action Swindon: 75 years must be close to a track record in this country! My hon. Friend is right to highlight that concern, which is one reason why we have created a national programme for third sector commissioning. This is a training programme for some 2,000 staff who commission public services across the country; half of them will be from local councils. The purpose is to spread best practice in commissioning arrangements, which will deliver better results for third sector providers and, most importantly of all, for the people whom those third sector organisations serve.

Norman Baker (Lewes) (LD)
Does the Minister accept that small community organisations face two problems? One is the tendency of funding agencies to want to fund projects rather than providing core funding, so the key officials and employees who work for those small organisations are not funded. The other is the difficulty that small organisations have with often complex and time-consuming form filling, which is not guaranteed to provide any funding at the end of the process. What are the Government doing about those two issues?

Phil Hope
The hon. Gentleman is right to highlight those concerns, which have been brought to our attention. That is why we have undertaken the third sector review. We will shortly publish our report on the proposals there. Measures such as three-year funding, for example, will be of great benefit to many voluntary and community groups, ensuring that instead of annual bidding rounds, three-year funding grants and contracts are entered into. That gives local organisations some security, and also means that they do not need to go through the bureaucracy of completing application forms every year. We can be pleased with the measures that the Government have taken. There is always more that can be done, but I hope that the third sector will see the benefits in the very near future.

Greg Clark (Tunbridge Wells) (Con)
The Minister will know that small community organisations rely heavily on volunteers. He will also know that yesterday Capacitybuilders, an organisation in receipt of £150 million of taxpayers’ funds, which is a Government agency, has scrapped its separate dedicated programme to encourage and help voluntary organisations. Does the Minister approve of that decision, has he consulted the new volunteering tsar, Baroness Neuberger, and does it have her support?

Phil Hope
The hon. Gentleman has got his facts wrong. Capacitybuilders has done no such thing as scrapping that programme, but is looking at ways to organise itself better. It is an independent body making decisions to ensure that it can serve and meet the needs of organisations and those who recruit and deploy volunteers to best effect. I am delighted to say that in another place Baroness Neuberger is leading the Government’s work on ensuring that we can engage volunteers in public services, not only for the benefit of users of those services but for the benefits that undertaking voluntary activity can have for people who work in those public services. I am greatly looking forward to her work and her energy in championing that cause.

Lynda Waltho (Stourbridge) (Lab)
I am sure that my hon. Friend is aware of the chaos caused in my constituency when Tory-controlled Dudley council cut all funding to youth organisations. I am glad to say that it has seen the error of its ways, and the announcement of further funding is excellent. However, continuity of funding is important. Will my hon. Friend agree to come to visit two organisations, the What? Centre and KIDS Orchard Partnership, which now have service level agreements but are worried about the continuity of their funding?

Phil Hope
My hon. Friend, too, champions the voluntary sector loud and clear in her constituency, and it is great that she is drawing my attention to two successful projects in which she has taken a personal interest. I would be delighted to come to her constituency when I can, to see the great work that they do. She is absolutely right to say that local voluntary organisations rely on continuity of funding. That is not helped when a political party makes one set of announcements supporting the voluntary sector but then, at local level, councillors in that same political party decide to cut budgets to try to deliver public services on the cheap. That is something that Labour Members reject—and I only hope that the same signal will go out loud and clear from the Conservative Benches.

Early Years Intervention

Helen Jones (Warrington, North) (Lab)
21. What steps he plans to take to promote early intervention in support of social exclusion policy; and if he will make a statement.

The Parliamentary Secretary, Cabinet Office (Gillian Merron)
Early intervention is key to tackling social exclusion and is a guiding principle for the social exclusion action plan, which proposes a range of ways to offer help and support during a child’s early years, such as the family nurse partnership pilot schemes.

Helen Jones
I welcome my hon. Friend to her new post. Could she tell the House what she is doing to ensure that the very successful Sure Start programmes reach out to the families who are most socially excluded but may well not attend a Sure Start centre, so that those parents and their children are supported and the children are given the best possible start in life?

Gillian Merron
My hon. Friend is correct to raise that point. I thank her for her kind comments to me in my new role. She is a tremendous supporter of Sure Start, which is indeed about making life better for children, families and communities. However, we know that we could do more. That is why I welcome the recently published families at risk review, which talks about how public services can be better organised so that we can better service the small but significant number of families whose problems cannot be dealt with in isolation. I look forward to my hon. Friend’s support in doing that.

Mr. Robert Goodwill (Scarborough and Whitby) (Con)
Has the Minister had discussions with Ministers from the Department for Children, Schools and Families to see how resources can be channelled through schools that have been proactive in this respect, such as George Pindar community school in Eastfield, which is tackling the problem of social exclusion on a whole-family basis?

Gillian Merron
The school that the hon. Gentleman mentions is a clear example of the kind of good work that we want to see. I have heard the Department for Children, Schools and Families referred to as the “Every child matters” Department. That explains the importance of our work in ensuring that every child, no matter what their background or circumstances, will have support to be healthy and safe and to prosper. Schools are absolutely integral to that.

Royal Prerogative

Tony Baldry (Banbury) (Con)
22. To what extent he expects his responsibilities to the Queen for the general administration of the Duchy of Lancaster to be affected by the proposed changes to the royal prerogative.

The Minister for the Cabinet Office (Edward Miliband)
The reform of the royal prerogative is designed to make the Executive more accountable to Parliament in important decisions such as going to war and making treaties. Since the appointment of a Chancellor of the Duchy of Lancaster raises no such issues, we do not currently propose change in this area.

Tony Baldry
I am grateful to the right hon. Gentleman for that courteous and informative response, but I was wondering whether he is the Minister for the Cabinet Office or the Chancellor of the Duchy of Lancaster. If it is the latter, why, at the start of the 21st century, do we require a Chancellor of the Duchy of Lancaster? If it is the former, will the right hon. Gentleman please ensure that the Table Office has a list of his responsibilities, and those of other Ministers, so that I and other colleagues do not have to dream up questions on the chancellorship and the royal prerogative for his Question Time?

Edward Miliband
The answer to the hon. Gentleman’s question is that I have both titles: Minister for the Cabinet Office and Chancellor of the Duchy of Lancaster. As to his suggested reform of the role of the Chancellor of the Duchy of Lancaster, it is a personal prerogative of Her Majesty, but I can pass on his representations to the Prime Minister. My responsibilities cover the span of those of the Cabinet Office, such as social exclusion, the third sector, civil service reform, e-government and a range of other matters. As for his question about the Table Office, I am sure that that is not within my area of responsibility.

Third Sector

Sarah McCarthy-Fry (Portsmouth, North) (Lab/Co-op)
23. What assessment he has made of recent progress towards meeting the Government's objectives for joint working with the third sector.

The Parliamentary Secretary, Cabinet Office (Phil Hope)
The third sector and the Government are working more effectively than ever before on a range of shared interests, including creating stronger communities, better public services, a stronger social enterprise sector and a more active civil society. Government funding to the sector has more than doubled since 1997 from £5 billion to £10 billion.

Sarah McCarthy-Fry
Many third sector organisations in my constituency complain that insecurity about funding is impeding their ability to deliver cost-effective, high-quality public services. They welcome the funds for capacity building and pump-priming, but often their funds run out before they have delivered what they want to achieve. What plans does my hon. Friend have to move away from short-term funding to more long-term service level agreements?

Phil Hope
I congratulate my hon. Friend on the fact that Portsmouth was a pathfinder in looking at the kind of barriers that confront voluntary organisations, and in developing an action plan to overcome them. That way of working is now being rolled out throughout the south-east, so I congratulate Portsmouth on that. My hon. Friend puts her finger on an important issue concerning duration of funding. The present Prime Minister made a specific commitment in the 2006 pre-Budget report to ensure that three-year funding will become the norm rather than the exception for voluntary organisations. I am working closely with my ministerial colleagues throughout the Government to ensure that that is the case at every level—national, regional and local.

Mr. Peter Bone (Wellingborough) (Con)
I have a new Sure Start centre and two new children’s centres—[Hon. Members: “Good news!”] That is good news, but the problem lies with the funding. It has been withdrawn from the voluntary organisation that used to provide the very services that are now being provided by Sure Start and the children’s centre. Services have closed down and been switched from voluntary status to the state. Is that what the Government intended?

Phil Hope
I guess that what the Government did not intend, when they gave extra funding to support children and families, was that the local Conservative county council in Northamptonshire would then go ahead and cut services for young people there.

Mr. Bone
indicated dissent.

Phil Hope
I have to tell the hon. Gentleman that although his party’s Front Benchers may say one thing about support for the third sector, I suggest that he goes back to the Conservative leadership of his local council to ensure that it delivers better services to support the third sector in his area.

 Economic Reform

15:33:00

The Minister for Local Government (John Healey)
With permission, Mr. Speaker, I would like to make a statement on local and regional economic reform in England. The Government are today publishing the conclusions of the review of sub-national economic development and regeneration, launched in the 2006 Budget as groundwork for this year’s comprehensive spending review. In this report, we set out the compelling case for reform to give local authorities and communities greater responsibility and opportunity to boost economic growth in their area; to bring consultation and planning for jobs, homes, investment and the environment closer together at both local and regional levels; and to strengthen public scrutiny and accountability of regional plans and the work of regional development agencies, both in the region and in this House.

This report builds on substantial work since 1997 to devolve economic decision making to regions and local authorities. It is informed by Sir Michael Lyons’ comprehensive review, in which he underlined the important economic role of local authorities as part of defining and delivering a vision for the places that they serve. It is also informed by Kate Barker’s recommendations to bring together planning for homes and the environment with planning for economic growth.

The review takes reform a stage further, giving local authorities stronger incentives and greater powers to support economic growth. As the constitutional Green Paper, which the Prime Minister launched a fortnight ago, said, the sub-national review

“will signal a shift of focus to local authorities, open up the possibility of powerful city regions and give a clearer role for the regions of England”.

The report also reflects the Prime Minister’s vision of a modern democracy, in which power is exercised at the lowest level, and those with power are held more clearly to account.

Moreover, the reforms are essential as global economic and technological change places an increasing premium on skills, innovation and enterprise. That means that our Government’s commitment to increase growth in all regions, reduce regional disparities and deliver neighbourhood renewal will, in future, be all the more challenging and important. It means that further freedoms and devolved decision making are required for regions and local areas: first, to respond to rapid economic change; secondly, to deal with persistent local deprivation or poor economic performance, and thirdly, to enable all places to develop to their fullest potential.

Our year-long review has been very open—we have visited every region and consulted more than 300 stakeholders at all levels. I can confirm our main conclusions to the House this afternoon. First, to give local authorities greater powers, flexibilities and incentives, we will consult on creating a focused statutory economic duty for local councils; put economic development and neighbourhood renewal at the heart of the new local government performance framework; and consider options for supplementary business rates, working closely with business, local government and other local experts. We will require regional development agencies to delegate funding to local authorities and sub-regions whenever possible so that they play a more strategic role, and we will move funding for most 14 to19-year-olds’ education and skills to local authorities from the Learning and Skills Council, as announced in the recent machinery of government changes.

Let me deal with sub-regions. To reinforce our cities and larger towns as the engines of economic growth in their areas and to recognise that labour, housing, retail and other markets often do not correspond to council boundaries, we will allow local authorities that work together in sub-regions to strengthen management of transport; develop proposals for multi-area agreements to encourage groups of local authorities to agree collective targets and pooled budgets for economic development priorities; and work with interested city and sub-regions on scope for statutory sub-regional arrangements, which could allow greater devolution of national and regional economic functions.

To strengthen, simplify and improve scrutiny of the necessary strategic role of regions, we will combine the regional economic strategy and regional spatial strategy into a single integrated regional strategy. Following consultation, we will bring together the economic, social and environmental objectives for each region and charge RDAs with executive responsibility to prepare the single regional strategy on behalf of the region. In doing so, they will have a duty to consult widely. They will work closely with local authorities and the first step will be for local authorities to set out a vision for the sustainable development of their area. Regional assemblies in their current form will no longer exist.

The spatial and planning aspects of the strategy will continue to form the regional tier of the statutory development plan, which will remain subject to testing through independent examination in public and will be issued as a statutory document as it is currently. We will strengthen the scrutiny and accountability of RDAs, with the House's new regional Select Committees holding RDAs and others to account in Parliament and with local authority leaders holding the RDA to account in the region and approving the regional strategy. We will consult on how best to implement that.

Finally, at the centre, to improve support and reduce restrictions from central Government we will give the Department for Business, Enterprise and Regulatory Reform single-lead responsibility across Government for performance management of the RDAs and lead responsibility for the regional economic public service agreement; simplify the targets RDAs must meet; and appoint a Minister for each of the regions—we have already done this—to provide a sense of strategic direction to their region and to give citizens a voice at the centre of Government.

The report sets out the principles and direction for future policy and the consultation that we will undertake on our reforms. Important Government announcements will follow: implementing the Leitch report, the housing Green Paper and the welfare reform Green Paper and, in the autumn, the comprehensive spending review. My statement this afternoon is the start of further reform, not the final word. I commend the report to the House.

Mr. Eric Pickles (Brentwood and Ongar) (Con)
I thank the Minister for his courtesy in allowing me early sight of the statement and of the sub-national economic development and regeneration review.

It is clear that the Minister comes here not to praise the former Deputy Prime Minister, but to bury him. The regional assemblies were the apple of the eye of the former Deputy Prime Minister—now little is left of the old regime but rubble, broken promises and chaos. Once the people of the north-east rejected regional government by referendum, the writing was on the wall for the assemblies.

Will the Minister confirm the words of the Prime Minister’s official spokesman this morning that sub-national government was

“just another word for regional government”?

This is a rebranding exercise masquerading as localism. The key tests are these: are the decisions taken locally and are the decision makers democratically accountable to local people?

On page 95, the review makes it clear that RDAs will become the regional planning bodies in place of the regional assemblies. The regional assemblies are unelected, unaccountable and unwanted and we will not mourn their passing. However, is not their abolition just a game of musical chairs, passing their functions from one distant regional quango to another?

We welcome the admission that Labour’s tiers of regional red tape are a hindrance to development and regeneration, with the farce of the regional spatial strategies contradicting the regional economic strategies. The RDAs are already failing to deliver on their existing responsibilities, as both the National Audit Office and the Institute of Directors have warned. Yet loading the RDAs with even more responsibility is hardly going to improve the quality of support that local businesses receive.

On page 94, the review asserts that the regional assemblies are not providing a strong voice for their region. Is not the reality that these unloved institutions have ceased to be the Government’s poodle because they stood up for local communities and local people? Now that the regional assemblies are criticising the lack of infrastructure and sustainability in the Government’s building plans, Ministers are seeking to sideline their opposition. The Government’s control freaks’ response is to abolish them and to hand their powers to a super-quango—rather than improving co-ordination, the different tiers of regional bureaucracy have caused confusion.

The regional spatial plans of the regional assemblies contradict the regional economic strategies of the regional development agencies—so much for joined-up government. If the Government wish to speed up the planning system, should the first step not be to scrap the quagmire of regional planning? How do the new regional economic growth initiatives outlined on page 93 square with protecting the countryside, planning against flooding, reducing carbon emissions and improving quality of life? Is not the environment now just a passing fashion for the Government? I fear that the RDAs now have England’s green belt in their sights. 

The review concedes that there are too many funding streams. Indeed, there are 50 different, fragmented funding streams for social exclusion, housing and regeneration. How many will remain after this announcement? Has Labour not just created a baffling array of conflicting, confusing and inconsistent quangos, grants and agencies? Even the Government’s friend, Lord Rogers, has slammed the overlapping regeneration schemes as diluting effectiveness and reducing the vision of an urban renaissance to “mediocrity”.

We are, of course, receptive to new powers for local councils to fund infrastructure and transport and to promote economic development. Will the Minister guarantee that any additional revenue from a supplementary rate will not be taken into account in central Government grant allocations? Why are local firms not being given a direct democratic vote on any supplementary rate? How high will a supplementary rate go? Will it be 4p on the multiplier or even more? If local businesses can vote on higher rates in a business improvement district, why can they not be given a vote on a supplementary rate? Does the move not risk becoming a back-door way to hike up business rates?

Mr. Philip Hammond (Runnymede and Weybridge) (Con)
A stealth tax.

Mr. Pickles
Good man.

Is the measure not just a stealthy means for the Government to pass the buck of providing infrastructure from the Exchequer to the local taxpayer? Is the move not just higher taxation without any representation?

Month after month since the 2004 “no” vote in the regional assemblies, more and more power has been transferred to expensive and distant regional pen-pushers and politicians. Labour has ignored the voice of the people. Regional government agencies, regional development agencies, regional planning bodies and regional Ministers are all about imposing the will of Whitehall on local communities. Much of the analysis in the report is absolutely correct—it is a catalogue of failure. The problem is that it proposes to reinforce failure with more failure. It risks creating a regional tyranny of governance with no mandate, no legitimacy and no accountability. Only our party will dismantle the regional state, restore power to local communities and make government once more accountable to the people.

John Healey
I am slightly disappointed by the hon. Gentleman’s response, but perhaps I should not be surprised. I would urge him and his hon. Friends to read the report rather than simply rehearse their soundbites. My right hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) has been one of the strongest and staunchest advocates of regional devolution and of giving greater powers to local authorities. He was one of the architects of our regional economic policy and my announcement this afternoon and the report take significant steps further in that.

The hon. Gentleman really must make up his mind on regional assemblies. Five days ago he said:

“The regional assemblies are unelected, unaccountable and unwanted.”

Four days ago, and again this afternoon, he said that regional assemblies had stood up for local people and that that was why we are abolishing them, and that:

“The Government’s move is expected since many of the regional assemblies are criticising the lack of infrastructure and sustainability in its building plans, and Labour wishes to sideline this opposition.”

Nothing could be further from the truth and, as I have tried to explain, our plans will mean that, for the first time, we are able to bring together the important planning functions within the regions and local areas on jobs, homes, infrastructure and protection of the environment. We will be able to do so better than before and better than through two separate processes. Council leaders will have a stronger role in the new system, not a weaker one—much more so, in fact, than they did through the regional assemblies.

Let me make it clear that we are committed to ensuring that there is strong local authority oversight of housing and planning. The hon. Gentleman’s party called for a stronger role for local authorities, and we are delivering that in the plans that I have announced this afternoon. His party also called for simplified arrangements in the regional and local areas, and we have announced such proposals this afternoon.

We have begun to consider options for supplementary business rates, working with business, local government and other experts. We shall continue with that work and report later in the year. We shall also ensure that there is full and close accountability to business in any of the options that we consider.

Dr. Phyllis Starkey (Milton Keynes, South-West) (Lab)
I welcome the general approach of the Minister’s statement in bringing together economic planning with housing, employment and spatial strategies. I want to ask him a specific question, however, about the proposals for the accountability of RDAs. He appears to be proposing accountability of the regional Committees to Parliament, and also, separately, to council leaders through some other, unspecified, mechanism. Will he consider the introduction of a hybrid committee to bring together MPs from the region and local authority leaders to hold the RDA accountable?

John Healey
I applaud my hon. Friend’s interest in this area and the work that she does as Chair of the departmental Select Committee. The principle that we are planning to put in place is that, at regional level, the performance of the RDA in preparing the single regional strategy and in delivering its part of the strategy, as well as the content of the strategy itself, should be subject to greater scrutiny in the region and in Parliament. In the region, that should be conducted by local authority leaders, who will be consulted and charged with scrutinising the preparation of the regional strategy. For the first time, they will also be charged with the role of approving the strategy. In that way, without an elected regional assembly, we shall be able to reinforce public accountability and the democratic oversight of this important work that must be carried out at regional level.

Andrew Stunell (Hazel Grove) (LD)
I thank the Minister for providing advance copies of his statement and his report, although to read the latter in the given time would have required a reading speed of two pages per minute, so if I have missed any of its subtle nuances, I apologise to him.

We do not share the phobic hatred of all things regional expressed by the hon. Member for Brentwood and Ongar (Mr. Pickles). There are aspects of the statement and the report that we welcome, particularly the recognition that it is important to re-empower local authorities if we are to deliver strongly on the economy and other important features for our local communities. We very much appreciate the intention to encourage co-operation between local authorities, allowing them to take up additional powers devolved from the regions and, we hope, from central Government. It is also good news that there is at least an intention to bring some of the thousands of quangos—including the Learning and Skills Council budget, the Highways Agency and Jobcentre Plus, with which many Members have recently had difficulties—back under local democratic control.

There are also aspects that cause real concern, however. There is nothing substantial in the document or the statement about environmental sustainability; it is all about growth and expansion. For example, I notice that a regional economic public service agreement is to be signed off by the Department for Business, Enterprise and Regulatory Reform, yet there is no regional sustainability agreement to be signed off by the Department for Environment, Food and Rural Affairs or agreed with central Government. Will the Minister therefore undertake to add environmental sustainability as a key objective of any regional policy reform?

I also note that the regional Ministers will

“provide a sense of strategic direction for their region”.

We could put that another way and say that this will involve a totally top-down process. Will the Minister explain how such a Minister—perhaps the Minister for the North West or, even more to the point, the Minister for London—will form a view about what the strategic direction for the region should be? Will he take his cue from the Secretary of State, from the regional development agency, from local authority leaders or just off the top of his head? The Minister may well feel that the loss of the regional assemblies is not a great one, but surely he would agree that any sense of strategic direction should come from the grass roots, from local communities and local authorities, rather than being imposed on high through ministerial edict.

Reference is made to moving towards a single integrated regional strategy. We have some difficulty understanding precisely what the Minister has in mind, so perhaps he can provide further explanation. Surely there has to be a diversity of strategies for different regions, and, within regions, the strategies need to be flexible enough to take account of the differences between the centre of Manchester, Carlisle and rural Cheshire. How, indeed, will a single integrated regional strategy apply to the region of London, in particular?

To summarise our view, we see this as a severe case of top-down, economic-growth-centred thinking that is some 30 years out of date, with the environment forgotten, democracy overridden and diversity scorned.

John Healey
I was encouraged by the hon. Gentleman’s early remarks, but somewhat taken aback by the latter ones—especially as I consulted a Lib-Dem policy document published a week ago today, which states:

“We would devolve real power back down to communities and local councils, bring quangos under democratic control and reduce central bureaucracy”.

Perhaps I should have borrowed those words and incorporated them directly into my statement, because that is precisely what our plans are designed to achieve. 

Everyone in every constituency and in every local authority area is concerned about more jobs and more homes, particularly for young people, as well as about taking proper account of the local environment and finding ways up front to fund the infrastructure necessary to support such growth and prosperity for the future. It is by bringing plans for those functions together that we stand the greatest chance of achieving that.

On the environment, let me remind the hon. Gentleman that regional development agencies, which seemed to be the focus of his concern, operate under the legislation that set them up in the first place. They are under a statutory responsibility to pursue sustainable development in the regions. As part of the new arrangements, local authorities will take the first step in the preparation of the new single regional strategy. As I explained earlier, that first step will be to prepare, for their area, their vision of future sustainable development, taking strong account of the needs, pressures and concerns of the environment.

On the question of Ministers, may I gently explain to the hon. Gentleman that the Prime Minister has appointed some first-rate female as well as male regional Ministers, so it is not just a male preserve? If I know anything about my good friends and colleagues who are now the regional Ministers, it is that they will not take their cue from anyone in particular. They will consult and listen carefully, but they will come to their own views and make their own contributions to the debate about what is best for their regions.

Finally, to be as clear as possible, the proposals set out in this afternoon’s review do not apply to London, which has its own arrangements on economic policy planning and its own arrangements for democratic control. The regional strategies are, of course, precisely that: they are strategies for the region. If the hon. Gentleman looked into existing regional economic development strategies, he would find that in many cases they place at their centre the cities and sub-regions that are driving economic growth and prosperity within the wider region, creating new jobs and bringing in new investment. That is precisely what this afternoon’s proposals are designed to reinforce.

Mr. Lindsay Hoyle (Chorley) (Lab)
I hope my hon. Friend recognises that some of us feel that the establishment of regional Select Committees is overdue and welcome this commitment to them, but will the Government ensure that they have real teeth? Will they ensure that the Committees have power to oversee the activities of regional development agencies and all the other quangos, and that Government Departments and agencies are answerable to each of them? If we are going to do this, we must give the Committees teeth and power and make the system effective.

John Healey
As the Prime Minister said two weeks ago, it is important to ensure that those who hold power are called clearly to account. The House has a much greater potential to play a strong role in doing just that at regional level.

I welcome my hon. Friend’s support for the principle of the proposed reinforced scrutiny and accountability arrangements, but I should tell him that the setting up of regional Select Committees, their remit and the way in which they conduct their inquiries are a matter for the House. No doubt he will play a big part in discussions of those matters over the next few weeks, but it is not for me, as a Minister, to pass direct judgment.

Angela Browning (Tiverton and Honiton) (Con)
If the newly empowered RDAs are to be accountable to council leaders in the region, what thoughts has the Minister had about appointments to them? At present it is common practice for council leaders to apply for vacancies on RDAs. Is there not a conflict of interest, in that those who are to scrutinise and hold to account see such vacancies as job opportunities?

John Healey
Our report does not propose any changes to the process of appointments to RDA boards, which are conducted entirely in line with the established code of practice for public appointments. However, the hon. Lady makes a fair point and an interesting suggestion. In future it will be for Select Committees and those who wish to hold RDAs firmly to account in the regions to consider how they might contribute to, influence or in other ways become involved in the process of appointments to RDA boards.

Mr. David Clelland (Tyne Bridge) (Lab)
I welcome my hon. Friend’s statement. The changes he has announced have the potential to provide a stimulus to encourage renewed regional co-ordination and activity, and will be welcomed in the north-east if they provide the clarity and the new vision that they promise.

The regional assemblies brought together local government, business, voluntary organisations and trade unions. Is my hon. Friend satisfied that the new structure he has announced will preserve the best of that inclusiveness, while also improving accountability and effectiveness at regional level? What powers will localities have over bodies such as the Highways Agency?

John Healey
I am satisfied that the Government have set out the right principles and the right direction for the reforms that are necessary to ensure that the work of RDAs and other agencies at regional level is held to account to a greater extent both in the House and in the regions. If I were not, I would not have announced them today. We are ready to consult on precisely how best to implement the arrangements, and will do so later in the year.

As my hon. Friend will appreciate, the appropriate arrangements for local authority leaders in particular to exercise their role in scrutinising RDAs’ work and approving regional strategies in his area will differ from those in the south-east, where there are 74 separate councils. It clearly makes sense to identify, through detailed discussion and consultation, the arrangements that best suit the circumstances of each region.

Mr. David Curry (Skipton and Ripon) (Con)
The Minister delivered his statement with such pathos that I thought we would hear the theme music from “Schindler’s List” at any moment. I agree with him that city regions are very important, and they may well be the bit of regional geometry that is coming, but why is he so reluctant to endow them with effective powers? There is still a kaleidoscope of delegated responsibilities and conferred duties. Would it not make sense simply to ask city regions rather than the RDAs to deal with such matters as skills and economic development, so that they have real meaning?

If the Minister wants the system to work in Yorkshire, will he note that the parts of north Yorkshire that used to be in the West Riding and wish to be part of a city region should not be imprisoned in a unitary North Yorkshire council, and thus incapable of performing their duties and meeting their responsibilities?

John Healey
I shall take the right hon. Gentleman’s last point as a late submission or representation on the local government restructuring that I am currently considering.

During the review, we were urged in some quarters to impose new formal arrangements in sub-regions. We took the view that the best approach was for there to be greater devolution of powers and freedoms to local authorities, and that they should collaborate where their city or region requires an economic effort that goes beyond their city council or borough council boundaries. We want to encourage such collaboration. Where that takes place, there should be opportunities for greater delegation of powers and management control in respect of transport—and also in respect of economic development, planning, housing and some of the 14-to-19 skills plans. If local authorities together wish to move to statutory arrangements—without pressure or prescription from central Government, because it must be their decision to do so—that will open the door for us to consider devolving more powers from national Departments and national agencies and to give sub-regions greater certainty and longer term funding for some of the transport functions that can best be delivered at that level.

Mr. Richard Caborn (Sheffield, Central) (Lab)
First, may I welcome this timely statement? The regional development agencies were set up a decade ago—in 1997-98—and some of the Opposition’s arguments then are the same as those voiced against my hon. Friend today. The RDAs addressed an economic deficit that existed at that time; we inherited a dysfunctional regional policy in 1997, and the RDAs have addressed that. There is now a democratic deficit, and the report and today’s statement start to address that through the establishment of Select Committees and through empowering local authorities to play a proactive role. Therefore, I welcome that report and I hope that my hon. Friend will take no account of what the Opposition say. In the 1990s, the electors of Bradford chucked out the hon. Member for Brentwood and Ongar (Mr. Pickles); he holds no sway with local authorities and I suggest that my hon. Friend continues in the direction that he mapped out in his statement.

John Healey
Alongside my right hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott), my right hon. Friend the Member for Sheffield, Central (Mr. Caborn) was perhaps the principal architect of early moves to devolve economic policy making to the regions. Indeed, he steered through this House the legislation that set up the regional development agencies. He played an important role during his years in government, and I am glad that he welcomes the further moves that I have announced to devolve more to the regions and local authority areas. If we are able to bring together in a single regional strategy those policies that are currently produced by two different processes and two bodies, often using different bases of information and analysis, we will have the basis for a strong regional vision and strategy that allows us to address at the one and the same time policies on jobs, homes, investment in infrastructure and protection of the environment.

We will also have the basis for achieving what my right hon. Friend continues to want: stronger partnerships at regional and local level and a better alignment of central Government and departmental spending that can help economic development and regeneration through the learning and skills councils, Jobcentre Plus, the new homes agency, the Highways Agency and also the Environment Agency.

Sir George Young (North-West Hampshire) (Con)
Why in a relatively small country such as England, where we already have well established counties and districts that people relate to, are the Government persisting in developing an unwanted, remote and undemocratic regional tier which people do not relate to?

John Healey
Quite simply, if matters are left at local authority level, there will be concern about equity across regions. As well as that, some projects and priorities need to reach beyond local authority boundaries to foster strategic development in terms of jobs, homes or infrastructure. That is the simple answer, and I hope that the right hon. Gentleman will accept the relevance and importance of some regional level functions. I hope that he will also accept that that is combined with a clear expectation and requirement for RDAs to devolve the funding to local authorities and sub-regions wherever possible and, by doing that, to reinforce the hand of local authorities to play, for the first time, a greater role in shaping the economy and prospects for their people in their area in the future.

Several hon. Members
rose—

Madam Deputy Speaker (Sylvia Heal)
Order. Many hon. Members wish to catch my eye and, as always, time is limited. I ask for brief questions and answers, so that more hon. Members will be successful.

Mrs. Louise Ellman (Liverpool, Riverside) (Lab/Co-op)
I welcome the recognition of the importance of local authorities, but will my hon. Friend continue to stress the importance of policies decided at a regional level to address regional disparities? Does he commend the north-west’s efforts to invest major funding in Daresbury, which has resulted in the region having one of only two centres of excellence for scientific research in the whole country?

John Healey
Yes, yes and yes.

Mr. John Redwood (Wokingham) (Con)
As someone who wishes to see the South East England Development Agency bite the dust alongside the Assembly, may I ask the Minister to explain why it is that those regions of the UK that have had well financed RDAs for longest—and strong regional planning and intervention for longest—have become progressively less well off compared with areas that have not been blessed with such organisations?

John Healey
Perhaps I should send the right hon. Gentleman the results and the figures that demonstrate that in recent years the progress on skills, employment levels and general prosperity has been faster in the poorest regions than the more prosperous regions, in part because of the economic leadership that RDAs and some local authorities, especially in the cities, have been able to provide.

Richard Burden (Birmingham, Northfield) (Lab)
The statement has many welcome aspects and I certainly look forward to further discussions in relation to the accountability arrangements for RDAs. When my hon. Friend talks about the welcome new flexibilities for local authorities, both joined together and on their own, will he address the fact that some of the bigger local authorities at city level, while important as a powerhouse for the region, can be remote from local areas? It will be vital for such authorities to be encouraged to devolve what powers they can internally inside the area, so that community regeneration may accompany economic regeneration.

John Healey
Indeed, and my hon. Friend is the first advocate that I have heard in the Chamber for triple devolution. That is an important principle and it is entirely consistent with the Prime Minister’s statement two weeks ago and the Green Paper on constitutional reform. It is important that local authorities do just that, and I hope that my hon. Friend will contribute to further debate and discussion on these matters and consider offering his services to the regional Select Committee in the west midlands.

Tony Baldry (Banbury) (Con)
What does the phrase

“develop proposals for multi-area agreements to encourage groups of local authorities to agree collective targets…for economic development priorities; and work with interested city and sub-regions on scope for statutory sub-regional arrangements, which could allow greater devolution of national and regional economic functions”

mean in plain English?

John Healey
In plain English, it means that local authorities that cover a wider city area can come together, pool budgets and decide on the priorities that they think are most important for economic development, transport and some of the skills aspects. They can agree those between themselves and with Government, and that will be how we will judge them, how local people judge them and it is what we want to see for the future.

Graham Stringer (Manchester, Blackley) (Lab)
I welcome the abolition of regional assemblies and the transfer of powers and resources to local democracy, but I remind my hon. Friend that almost all the powers and resources of the scores of regional bodies came originally from local government. Would not it make sense to go the whole hog and abolish all the regional quangos and thus empower the electorate instead of other parts of the quango state?

John Healey
I know that my hon. Friend, a former leader of Manchester city council, is a leading advocate for that city and for city regions led by city local authorities. However, I must correct him: the arrangements that we have put in place and which we are looking to take further involve some devolution of powers and decision making from the centre. My hon. Friend follows transport policy very closely, and I remind him of what took place in the most recent funding allocations. In that process, £700 million of what would otherwise be determined entirely centrally was allocated according to the priorities set by the regions, and about which they had advised the Secretary of State.

Dan Rogerson (North Cornwall) (LD)
I welcome some of the proposals that the Minister has outlined, and especially his recognition that communities of interest, such as the seven counties in the south-west, exist at levels below the Government’s regional architecture. Will he take seriously the aspirations of the people of Cornwall to have a greater say over their affairs, especially given the ambitious proposals for a unified structure of local government in the area? Also, will he look again at the case for a locally accountable Cornish development agency, in light of the important convergence funding from the EU?

John Healey
Cornwall still faces some significant economic challenges. It has been greatly transformed by the objective 1 funding that it has received, and by some of the measures that the South West of England regional Development Agency has put in place. I take the hon. Gentleman’s comments as another late representation to be considered as part of my work on local government restructuring.

Gwyn Prosser (Dover) (Lab)
I warmly welcome the Minister’s statement, and his announcement that the regional assemblies will be abandoned. I am especially pleased that the South East England regional assembly will go, as it never understood housing policy or the needs of the east Kent ports such as Dover and Deal. Does he agree that the new devolved structure will reach out to such areas and allow the voices of deprived parts of Kent to be heard? In the past, they have been drowned out by the prosperity of the wider region.

John Healey
Indeed it will, and it is important that those areas that do not shout the loudest or have the strongest clout are at the centre of our policy concerns, as they are in our regional-level planning. My hon. Friend may be interested in the proposals set out in the review for a more concentrated allocation of regeneration funding, and for ensuring that mainstream funding from central Government agencies does more to support local regeneration efforts in the most deprived areas.

Mike Penning (Hemel Hempstead) (Con)
May I assure the Minister that all my constituents will hear the promises made today to re-empower local government? Will he confirm that that will mean that the 18,000 new homes that have been imposed on my local community are dead in the water and that they will not go ahead if the local authority continues to object?

John Healey
The hon. Gentleman will know that all the regional assemblies are engaged in revising their regional spatial strategies. With the exception of the West Midlands regional assembly, all regional assemblies are due to complete the process by next summer. Under the new proposals, local authorities will be involved in taking the first steps in preparing the regional strategy. They will set out their vision for the sustainable development of their areas, just as 40 towns and cities have raised their levels of housing growth under our growth points programme. The system will reinforce our ability to meet the need for housing, jobs and infrastructure development.

Tony Lloyd (Manchester, Central) (Lab)
I welcome today’s statement, and remind him that the regional policy adopted by Conservative Governments of the past was very unfair, based as it was on the premise that success should go to the successful. If we are to build a genuinely one-nation approach, we must make sure that there is a regional process that delivers to the people whom this Government want to represent. However, people in my constituency will not know that the regional assemblies are to go, as they do not offer the accountability that we need. Will he guarantee that the Select Committee and local authority approach will mean that regional institutions are properly accountable to local people?

John Healey
The plans we are setting out today for stronger public scrutiny and accountability within the region of the work that the regional development agencies and other regional agencies may do will improve public understanding and public challenge of the work being done in the region on the public’s behalf. Clearly, Parliament can reinforce that for the first time, through regional Select Committees, and I hope MPs on both sides of the House will play the most active possible role in making sure that the Select Committees are a success.

Bob Spink (Castle Point) (Con)
Does the Minister agree that infrastructure is the key to local growth and regeneration, and that building before the infrastructure is put in causes damage to local economies? Will he tell my constituents, who want to hear from him today, how the changes will get Canvey Island its much needed additional access road?

John Healey
The hon. Gentleman is absolutely right. I have mentioned that we are considering options for a supplementary business rate and the review also lays out plans for reforming the business growth incentive we introduced just over two years ago for local authorities. In addition, it confirms that we are considering innovative funding methods, particularly to raise early investment capital for local authorities and local areas to develop infrastructure to support growth in the future.

Mr. Kevan Jones (North Durham) (Lab)
I welcome the abolition of regional assemblies and the contribution that will make to lessening global warming by reducing the amount of hot air and strategy papers they produce. I also welcome my hon. Friend’s commitment to sustainable development, but in County Durham the regional spatial strategy outlined at present will actually stop development, so will he go one step further and bin the strategy, which has more to do with Soviet central planning than with a modern dynamic north-east economy?

John Healey
Of course the elements of the spatial strategy as a whole, about which my hon. Friend is so concerned, will be subject to independent examination and public scrutiny and, ultimately, to formal statutory sign-off by the Secretary of State.

Mr. Philip Hollobone (Kettering) (Con)
It would be far better were powers transferred back to county districts and boroughs, but if we are to persist with some form of regional quangocracy what consideration has the Minister given to establishing a region called Milton Keynes and the South Midlands? At present, that absurd sub-region, involving three parts of three different bigger regions, is meant to control all the housing expansion in Northamptonshire but simply does not provide the transport infrastructure that local people require.

John Healey
I have given no consideration whatever to the creation of a new Milton Keynes region.

Mr. Clive Betts (Sheffield, Attercliffe) (Lab)
I welcome the generality of my hon. Friend’s statement, especially the enhanced powers for local authorities in 14 to 19 provision and in economic development, and the flexibility in allowing city regions to develop at their own pace, which is very important. As well as extra powers for local authorities, will he also consider extra mechanisms to enable economic development to take place, and especially, as recommended by the all-party group on urban development, enhancing the ability to enter into public-private partnerships and to use tax increment funding whereby future income streams can be brought forward to enable capital infrastructure to be put in at an earlier date?

John Healey
I respect deeply my hon. Friend’s experience both as a Sheffield city leader before he entered the House and in his work on the Select Committee on Communities and Local Government. He is right to identify the fact that public money must be used to leverage in much greater private sector investment to help with regeneration and development. He will want to look particularly closely at the passage in the review on our work on innovative funding mechanisms, including possible options for regional infrastructure funds, better use of local authority assets and reliable revenue streams against which local authorities may be able to borrow to fund the infrastructure development needed in the future. We will report back on that work by the pre-Budget report this year.

Kelvin Hopkins (Luton, North) (Lab)
I very much welcome my hon. Friend’s statement, but I have a concern about the use of private consultants. For too many years, there has been widespread use of private consultants in local economic development. They have been expensive, incompetent and unaccountable. Will he urge all local authorities to do the job in-house, with directly employed public servants, and not to use private consultants?

John Healey
I thought that I had moved from the Treasury, where I had to deal with questions like that over the previous five years. My hon. Friend is right in general terms to challenge the way in which local authorities and other agencies may use their resources. I hope that he will play a part in doing just that on the regional Select Committee that will serve his region. However, sometimes it is important that expertise that may not rest within a local authority can be brought in so that local authorities can do a better job of analysing the economic circumstances of their area and plotting and planning priorities for the future.

 Ministers for Women (Priorities)

Madam Deputy Speaker (Sylvia Heal)
Will Members who are not staying for this Statement please leave as quickly and quietly as possible? Thank you.

16:26:00

The Minister for Women (Ms Harriet Harman)
I would like to set out to the House how my hon. Friend the Member for Stevenage (Barbara Follett) and I intend to take forward our work as Ministers for Women. We are publishing today a paper setting out our priorities. The Women's National Commission has agreed that it will take forward a consultation outside the House on the priorities and I am grateful to it. Our work in government will focus on three issues: first, helping families who care for older and disabled relatives, as well as those bringing up children; secondly, tackling violence against women and improving the way in which we deal with women who commit crimes; and, thirdly, empowering black and Asian women to help them as a force for good in their communities and as they build bridges between communities.

Families need to have enough time and money to care for older and disabled relatives, and to bring up their children in the way they want. They need proper support from good local services for both older relatives and children. As Ministers for Women, we will build on the strong foundation of support for families which the Government have already delivered to ensure that all families have real choices about how they live their lives. On this, we will be working alongside our ministerial colleagues in the Department for Business, Enterprise and Regulatory Reform, the Department for Work and Pensions, the Treasury, and the Department for Children, Schools and Families.

This first strand of work will also include pressing forward with the Government’s commitment to tackle the pay gap between men and women—a gap that is not only unfair in principle, but which plays such a large part in the unequal division of labour in the home, preventing fathers from playing a more active role in their children’s early years and preventing women from fulfilling their opportunities at work. As Ministers for Women, we will also work with Ministers in the Department of Health, the Department for Work and Pensions, and the Department for Communities and Local Government on how health and other local services can better support families who care for older and disabled relatives.

The second strand of our work will be about women who are victims of violent crime and women who are offenders. Domestic violence still results in two homicides every week. It not only harms women but has a devastating impact on children. Human trafficking takes many forms and blights the lives of men, women and children in many different continents. Britain is a major focus for the global trade in the sexual exploitation of women by traffickers, who trick or abduct young women and force them into prostitution. We have done a great deal to step up action against domestic violence, sexual offences and human trafficking, but there is more to do. We need to ensure that the substantive law is right and make it clear beyond doubt that domestic and sexual violence against women, and human trafficking for prostitution, will not be tolerated. We will be working alongside Ministers in the Home Office and with my hon. and learned Friend the Solicitor-General to tackle this.

On women who commit crimes, my noble Friend Baroness Corston found that many of the women in prison are there for minor, non-violent offences, and that many of them have mental health problems, or problems to do with drug or alcohol abuse. On women offenders, we will work with my right hon. Friend the Secretary of State for Justice on taking forward the agenda so ably mapped out by Baroness Corston. We can and will do more to ensure that women who have offended are rehabilitated, and that women who are at risk of offending are prevented from doing so. As Baroness Corston outlined, we will do so through ensuring effective services for drug and alcohol addiction, and for mental health problems.

Thirdly, we will work on the issue of empowering women in black and Asian communities. Women play a crucial role working together in their communities, whether they are working to reduce crime in their area, like Mothers Against Guns, or working to improve local services by taking part in tenants and residents associations, school governing bodies and parent teacher associations, or whether they are Asian women, like Southall Black Sisters, working to support other Asian women. We want to do more to support and empower those women as they tackle problems within, and build bridges between, communities.

We will work closely with ministerial colleagues in the Department for Communities and Local Government to take our agenda forward. We will also work with Ministers from across Government to ensure that black and Asian women have fair opportunities to work and take part in wider public life, including by becoming councillors and Members of the House of Commons. I hope that we can take that work forward with the support of local government, and supported by, and working with, Members of the European Parliament. We will also work alongside voluntary organisations, women’s organisations such as Women’s Aid and the Women’s Institute, trade unions and employers. We want to work not just with our ministerial colleagues, but with hon. Members, both women and men, on both sides of the House.

Mrs. Theresa May (Maidenhead) (Con)
I thank the right hon. and learned Lady for coming to the House to make her statement today. I certainly welcome the sentiment behind what she has said, and I look forward to working constructively with her, as my hon. Friend the Member for Epping Forest (Mrs. Laing) did with the Minister’s predecessor, to improve the lives of women in Britain. However, I am disappointed by the lack of ambition that has been shown in an area where there is still so much to be achieved. Will she confirm that not a single part of today’s statement is a new policy? I have to ask why, after 10 years in power, the Minister is only launching a consultation on the important issues that were mentioned.

We live in a time of rapid social and economic change. Even in the 10 years since 1997, the workplace and the world beyond it have changed remarkably. Government policy relating to women has to keep pace with that change, but it has not always done so. The issues confronting women are diverse and complex, so instead of having a one-size-fits-all idea of how women should lead their lives, Ministers must pursue a policy based on choice for women who are free and empowered to make their own decisions.

The right hon. and learned Lady said that she would focus on helping families, tackling violence against women, and empowering women in black and minority ethnic communities. Those are laudable aims, and when she comes up with new policies, we will support her if she gets them right, but as usual, the rhetoric exceeded the reality by some distance. She said “the Government have already delivered to ensure that all families have real choices”, but what about the 90 per cent. of families who use a relative or neighbour to care for a child? They do not get the support that is available to those who use Government-approved child care. What about women’s pensions? One in four single women pensioners lives in poverty, yet the Minister did not even mention pensions in her statement.

The Minister said that she will be “pressing forward with the Government’s commitment to tackle the pay gap”, but that implies that the Government are already making progress, and they are not: women who work full time earn 17 per cent. less than men. Does she accept that progress on equal pay has stalled? She mentioned violence against women. The Government have indeed acted on the issue of domestic violence, but does she agree that we need further action—and, I suggest, a change to police attitudes—on stalking, an issue on which the Government have so far done little? The Minister said, “We have done a great deal to step up action against…human trafficking”. The Government signed up to the convention on action against trafficking in human beings, but it still has not been ratified. In questions to the Minister for Women on 5 July, I asked when it would be ratified and what specific policy changes have been made as a result of signing the convention. The right hon. and learned Lady did not answer. Will she do so now?

The Minister said that she will work with the Justice Secretary to address problems with women in prisons. We know his answer to problems in prisons—he tends to let people out—but the crisis caused by the lack of prison capacity exacerbates the problems experienced by female prisoners. In the outside world, women are three times less likely than men to commit suicide; in prison, they are twice as likely to do so. Women prisoners are twice as likely as men to be held more than 50 miles from home. How can the right hon. and learned Lady reconcile the hope of improving the lot of female prisoners with the reality of overcrowded jails?

Today’s statement betrays the problem behind the Government’s approach to women’s issues—a problem that goes all the way back to 1997. While some changes are indeed welcome, there is no coherent philosophy or joined-up strategy that underpins that policy. That needs to change. I welcome the fact that the right hon. and learned Lady has set out priorities for women today, but I do not welcome the fact that there is so little substance in her statement. Women of all types and in all circumstances—mothers with children who are juggling their work-life balance, women in pensioner poverty, and vulnerable women—are looking to her for more than fine words. When she returns to the House to make her next statement on women’s issues, we expect substance, not style.

Ms Harman
The right hon. Lady appears to agree that these are the right priorities—it is right to focus on families, violence against women, and to support women in their communities. I assume she believes that those are the right priorities, but she criticised us for a lack of ambition. If she wants us to be more ambitious, I would welcome her support for our programme becoming more ambitious. It is important that we will the ends as well as the means. It is not right to say that one supports families who want to balance work and home but then vote against the legal rights necessary to help them. It is not right to say that one supports the fight against human trafficking but will not work with colleagues in Europe to deal with a Europe-wide problem. It is not right to say that one supports women in black and minority ethnic communities if one will not support the financial investment in those poor and deprived communities that the Government have made. 

I urge the right hon. Lady to join us in our commitment to do a great deal more, and will the means, not just the ends. Rhetoric—she is absolutely right—does not help a single family, does not protect one single victim of crime, and does not help any minority ethnic woman struggling in her community. We have done a great deal, but we have brought to the House a focus on priorities in areas where we need to do more. I acknowledge that we have not set out a list of new policies. We have said what our three priority areas are so that people in the House and, importantly, people outside it, know what we are focusing on and can work with us to achieve it.

The right hon. Lady talked about choice and people being free to lead their lives how they want. Part of the problem is that the less money someone has and the fewer services available to them, the less choice they have, so I look forward to her support for extra financial support and public services. She talked about the difficulty of families caring for children, and it is true that one of the big demands from families is that people should have more time so that they can care for young children within the family, which is why tax credits and the minimum wage are so important. If someone has to work all hours to make ends meet, they do not have any time with their children, so the minimum wage is not just about money but about time. 

The right hon. Lady spoke about pensions. Women in retirement suffering from inequality and having a poor standard of living is a very important issue for the Government, about which my hon. Friend the Minister for Pensions Reform will say more when we discuss the Lords amendments to the Pensions Bill in the next item of business.

The right hon. Lady said that action on the pay gap had stalled, and she mentioned some figures. It is true to say that the pay gap between women working full-time and men working full-time is about 12 per cent., but the pay gap between women working part-time and men working full-time is 40 per cent., so I agree with her that much more needs to be done to tackle unequal pay, and I look forward to her wholehearted support for more radical measures. I will pray her in aid when I am talking to my colleagues on the subject.

The right hon. Lady said that we had not done anything about stalking. That is not the case. We introduced the Protection from Harassment Act 1997, and we have done a great deal of work with the police, prosecutors and the voluntary sector to deal with the menace of stalking.

On human trafficking, it is not just a question of signing up to and ratifying conventions. It is what we do about the problem, working with the police, prosecutors and the courts. It is what we do about what is happening in our communities. I have a local newspaper, the Ham & High. The whole House should think about this. Here are some extracts from the personal ads:

“New Polish girls”,

“New Japanese & Korean girls”,

“Romanian ladies”,

“New oriental beauty”,

“All girls 18-25”,

“New tropical models”,

“Beautiful girls daily. All nationalities”.

We need to think—

Mr. Shailesh Vara (North-West Cambridgeshire) (Con)
If the Government ratify, we can deal with it.

Ms Harman
No. We need to think of the demand side of the problem. Who is reading those ads? This is a very difficult issue. There is no consensus about how we deal with the demand side—the men, the fathers, the sons, the brothers, the husbands who are reading those ads and who are fuelling the demand side of global sexual exploitation of women.

I welcome the support of the right hon. Member for Maidenhead (Mrs. May) for our focus on women in prison. I think we can make progress on that. We would welcome working co-operatively with her on it. She says that the problem behind our approach is a lack of—did she say ideology?

John Bercow (Buckingham) (Con)
A lack of ambition.

Ms Harman
A lack of ambition, but the right hon. Lady did say something about a lack of ideology. Our commitment is to making sure that we tackle inequality and empower women. I hope she will work with us on that.

Jo Swinson (East Dunbartonshire) (LD)
I thank the right hon. and learned Lady for the courtesy of allowing me prior sight of the statement. I take the opportunity to welcome her to her position. She has an impressive track record of working on women’s issues, and I hope that in government she will be a strong advocate for women on a wide range of issues.

In the statement, the right hon. and learned Lady rightly put support for families up front. One of the biggest challenges facing women is balancing their family responsibilities and their work commitments, although that is an issue for men as well. We should not pigeon-hole it as a women’s issue. Indeed, we will probably be able to conquer the problems only when men, too, are engaged with the changes that are required.

On the pay gap, the figures have already been quoted—12.6 per cent. for full-time work and 40 per cent. for part-time work, and we need to do more to reduce the gap. Will the Minister consider extending equal pay audits to the private sector? On flexible working, the paper published today alongside the statement says that the Government are considering extending flexible working to parents of older children. Does that mean up to the age of 18? Will the Minister go further and accept that extending to all the right to request flexible working would help to change our working culture and reduce some of the resentment that can be created when some colleagues have an opportunity to request flexibility and others cannot?

Clearly, affordable child care is an important part of that, and I welcome the Government’s moves to make child care more affordable. Are new resources being announced to facilitate that? If not, how does the Minister expect that that will be achieved?

I agree with the right hon. Member for Maidenhead (Mrs. May) that the part that was missing from the families section of the statement concerned women’s pensions. Later today we will debate the Pensions Bill. Although there are some welcome improvements for women who have taken time out to care for families, they will be applied only after 6 April 2010. The difference that that will make to women who reach pension age the day before is that they will lose out on £27,000-worth of pension entitlements. I urge the Minister to comment on whether she thinks that is fair. If we are really going to be fair to women on pensions, surely it is time that the Government went one step further and based pensions on residency rather than national insurance contributions, because even under the new plans women with fewer than 30 years of NICs will not be entitled to a full pension.

On violence against women, it is welcome that a lot of cross-Government working is planned. The End Violence Against Women campaign has been scoring the Government in this respect. They got one out of 10 in 2005 and two out of 10 in 2006, so I hope that the trend is on the up. I hope that this will lead to better cross-departmental working, because that is what the campaign says has been missing, although individual strategies have been in place, for example on domestic violence. What steps will the Minister take to create an integrated strategy involving all Departments to tackle violence against women, instead of a piecemeal approach?

The moves on women in prison are welcome. We will of course scrutinise the Government on delivery and the action that is taken. However, given that four out of five women prisoners have a mental illness, it is urgent that the situation is tackled, and we will give the Government support in doing so.

On trafficking, it is welcome that the Government have now signed the European convention against trafficking in human beings and is planning the new legislation that is needed to implement the actions necessary to deal with the problem. The advertisements that the Minister read out from the newspaper will have been shocking and horrific to us all. However, while all these things are being put in place, it would be helpful for the House to have some idea of roughly when we can expect the convention to be ratified.

It is well documented that black and Asian women in communities across the UK suffer more discrimination than white women or black and Asian men, so that is clearly an important issue for the Government to tackle. However, the Commission for Racial Equality recently expressed disappointment about the discrimination law review and is concerned that there may be proposals to wrap the equality duties into one single duty that ends up being weaker. What reassurance can the Minister give that new proposals to simplify existing equality legislation will not result in a rolling back or weakening of the current race and gender equality duties?

Ms Harman
I welcome the hon. Lady to her new position and look forward to working with her. I thank her for her comment about the decades of work that I have done in this area. However, my hon. Friend the Member for Stevenage and I do not find ourselves on our own in taking forward this agenda. As well as the many men on the Labour Benches who support it, 97 women Labour Members of Parliament will ensure that it is taken forward.

The hon. Lady rightly says that this is an issue for men as well as women. If a new baby comes along and the father is earning much more than the mother is, he has to work increased hours to bring home more money while she works fewer hours to care for the child. The difficulty is that there is no choice. Because he is earning so much more, she has to be the one who takes more time off—they cannot share the responsibility equally or even decide that he will be the one who stays at home and looks after the child. Unequal pay is not just a matter of principle but a matter of choice within families at home. We have taken forward greater rights to paternity leave. Families are not just about women. Women shoulder most of the responsibility of the work of caring for young children and elderly relatives, but men increasingly want to share that responsibility, and we must ensure that the labour market and pay rates do not prevent them from doing so.

I agree with the hon. Lady that equal pay is important, but it is difficult to make progress in tackling discrimination in pay, or unequal pay, while it remains hidden. That is why I welcome our commitment to ensure that Departments publish gender pay audits, so that we can see what is happening in terms of pay rates.

The hon. Lady spoke about the right to request flexible working and suggested that everyone should have the right to request it. It is argued by many, particularly the Equal Opportunities Commission, that if everybody, not just those with children, or with disabled or older relatives, were entitled to request flexible working, it might reduce the hostility of those without children, or such relatives, towards those who have them. We must recognise that it is a social policy imperative to ensure good family care and support for children, disabled relatives and the elderly. We have to argue that case to people and say, “If you don’t have those responsibilities, you are freer at your work, and can do more work than those who are working on behalf of their own family and society as a whole in supporting and caring for elderly relatives, or bringing up children.” There is not a public policy equivalence between allowing flexible work in order to let someone play a round of golf, and allowing it so that someone can care for an older relative. I do not agree with the hon. Lady’s line of argument on that.

We have made progress on affordable child care, but—heavens above—we are just at the start. Many families are tearing their hair out because affordable, flexible, high-quality child care is still not available to them. We have a long way to go—there is no doubt about that.

The hon. Lady talked about inter-departmental working on violence against women. We are considering merging the inter-ministerial group on domestic violence and the inter-ministerial group on sexual offences in order to take an overall view across Government on violence against women.

The hon. Lady recommended that in order to tackle the problem of the inequality of men’s and women’s incomes in retirement, we should simply use residence in this country as the main criterion, rather than the contributory system. My view is that we must ensure that people can contribute when going out to do paid work, which should be recognised in their national insurance contributions, but when they stay at home, caring for elderly or disabled relatives, or children, that too should be recognised as a contribution, and they should be credited for it. The problem with our system is not that it has been contributory, but that the only contribution, which has been disproportionately recognised, is paid work, not the valuable unpaid work that women do in their families. That is the historic problem.

I agree with the hon. Lady that overcrowding in women’s prisons is a particular problem. It is cruel for women prisoners with mental health problems, who have offended because they were victims of violence and sexual abuse in childhood, or because of those mental health problems. We have a positive programme concerning women offenders, which has been ably mapped out by my noble Friend Baroness Corston.

The hon. Lady spoke about the review of discrimination law. There is no intention to have weaker legal duties; it is a matter of strengthening the role that the law can play in equality.

Finally, on the ratification of the convention on human trafficking, when I was Solicitor-General—a role that my hon. and learned Friend the Member for Redcar (Vera Baird) now has, and she is doing a terrific job—I worked with prosecutors in Brussels and many European countries, and with Interpol, and I can tell the hon. Member for East Dunbartonshire (Jo Swinson) that what we sign is very important, but beyond that is what we actually do. It is a question of what we do about the demand side. We are talking about billions of pounds of serious, organised crime.

I am in favour of ratification and implementation of any such treaty, but we need to consider some serious issues. What are we going to do about demand? Why is trafficking a multi-billion pound, lucrative serious organised criminal business? It is because men pay for sex with exploited, trafficked girls. We need to consider what we are going to do about that. We need to work further on whether and how to criminalise such exploitation. In Sweden, the problem has been tackled by making paying for sex a criminal offence. We must examine the way in which other countries try to deal with the problem.

Several hon. Members
rose—

Madam Deputy Speaker
Order. Many Members want to speak. May I make a plea for brief, single questions and short responses?

Julie Morgan (Cardiff, North) (Lab)
I thank my right hon. and learned Friend for her statement. It is great to have the priorities laid out at the beginning of her term as a Minister and I welcome the fact that consultation will take place. I especially welcome the section of the statement on carers. What more can we do to help carers who are unable to work outside the home because they look after a disabled or elderly relative and may consequently live in poverty and also be isolated? Has she considered those issues?

Ms Harman
My hon. Friend may well be aware that the Prime Minister announced a review of support for carers. We must all acknowledge that the subject will move up the agenda, given that people with disabilities live longer, older people live to a greater age and family care is the choice of the older person and of the family. The question is, as my hon. Friend points out, how we support people to make those choices without their suffering financial destitution and social isolation.

I thank my hon. Friend for her comments about me and my work. I pay tribute to her work in setting up Cardiff Women’s Aid, which is an exemplar of tackling violence against women, and in child care in Cardiff, including Chwarae Teg, which was a joint organisation of employers, trade unions and women’s organisations for greater flexibility at work.

John Bercow
I warmly welcome the right hon. and learned Lady’s priorities for women in public policy, but they must be reflected in such priorities in the work of the House. Given that she is both Minister for Women and Leader of the House, will she conduct an urgent conversation with herself and then agree with me that it is monstrous discrimination against her that she is allowed to answer oral questions for only 10 minutes a month, that the time should be at least tripled, and that, given that she is Minister for Women, it is only right and proper that, in 2007, we should have a Select Committee on women’s issues?

Ms Harman
The idea of having a conversation with myself and ending up agreeing with the hon. Gentleman is interesting. The point about setting out our priorities is that we will work alongside our ministerial colleagues as they take policies through their Departments, and they will be accountable to the House. Additionally, as women Ministers we are accountable. We must ensure that the priorities and objectives are clear and made mainstream in the work of different Ministers, who are then held to account by Select Committees.

All the time, we need to think about the structures of accountability and how we create a greater focus on the issues that we are considering. I welcome the hon. Gentleman’s comments in that spirit.

Margaret Moran (Luton, South) (Lab)
I very much welcome my right hon. and learned Friend’s emphasis on violence against women and her reference to the impact on children. I know that she is aware of the project that I am currently running with Women’s Aid  called Kidspeak, through which we listen to the experiences of children who are affected by domestic violence. Does she realise that some of the evidence already shows that impacts include truancy, self-harm and poor school performance? There is also a terrible lack of resources to support those children. Will she urgently look into that as part of her priorities?

Ms Harman
My hon. Friend set up the all-party parliamentary group on domestic violence, which made me remember what a long way we have come since the days of Jo Richardson, who was politely ignored if she mentioned domestic violence once in the House and had people muttering behind their hands if she mentioned it twice.

My hon. Friend’s Kidspeak work reminds us that the old view that people should stay together for the sake of the children even while enduring violence misunderstood the effect of domestic violence on children. All the evidence is that even if children are not physically caught in the crossfire—sometimes they are and sometimes they are killed at the same time as their mother—they are always traumatised and damaged by being in a household where there is domestic violence. That is why it is important not just for women, but for children in the family.

Mr. Anthony Steen (Totnes) (Con)
I thank the Minister for her statement; we expect great things from both her and the Under-Secretary of State for Work and Pensions, the hon. Member for Stevenage (Barbara Follett). The Director of Public Prosecutions gave a rousing and informed address to the all-party group on human trafficking yesterday and admitted that trafficking was on the increase. The Minister will not be surprised to know that the statutory police performance targets do not include trafficking, so there is no pressure on the police to apprehend traffickers.

In her consultation, will the right hon. and learned Lady look at the question of compensation for victims when traffickers are apprehended? At the moment, not one penny piece has been given by traffickers to their victims. One of the most important things that the Minister could do is to make sure that the victims of trafficking receive not only the identity cards that give them the right to stay in this country, but compensation for the awful ordeal they have gone through.

Ms Harman
The hon. Gentleman says that he expects great things of myself and my hon. Friend the Under-Secretary. We will make great progress if we all work together on this. Many of these issues are difficult, but we need to recognise the scale of the problem and to take radical action. We have to build on these agendas or we will not make progress; we cannot be cautious. I hope that we can work with the hon. Gentleman, to whom I pay tribute, along with the other members of the all-party group, which does good work. I will consider and discuss with my colleagues his point about targets.

The hon. Gentleman makes an important point about compensation. The CPS has been focusing more not just on apprehending, prosecuting and punishing the offenders, but on seizing the assets. There are vast assets involved and the problem is that someone can spend a couple of years in prison, then come out and live like a millionaire. The more assets there are, the more they get reinvested in bringing more women from different parts of the world to be sexually exploited and raped in this country. The hon. Gentleman is absolutely right about the importance of freezing and seizing the assets. He is also right about the importance of the courts using the powers to order compensation. I am interested to hear that he has already had a discussion with the Director of Public Prosecutions and I will discuss this with my ministerial colleagues in the Ministry of Justice and with the Solicitor-General to see whether we can encourage further progress in this respect.

Several hon. Members
rose—

Madam Deputy Speaker
Order. May I once again ask Members to ask a single question and for there to be a brief response? Many hon. Members are still hoping to make a contribution.

Ms Sally Keeble (Northampton, North) (Lab)
I very much welcome the priority given to women at work, especially tackling the pay gap. Will my right hon. and learned Friend look at the outstanding work being done by the YWCA, in its “More than one rung” campaign, in getting women apprenticeships in areas of skilled work that attract higher pay, such as building, electrical engineering and car work, so that they can earn more pay when they are training and throughout their working lives?

Ms Harman
I thank my hon. Friend for bringing to my attention the work that the YWCA is taking forward. She is absolutely right that it helps to tackle the pay gap. However, the additional point is that if young girls can see a future for themselves and have aspirations, that is the best way of avoiding teenage pregnancy and ensuring that they have financial independence. It was said to me a few moments ago by one of the officials with whom we were talking about teenage pregnancy that the best contraception is aspiration.

Mrs. Iris Robinson (Strangford) (DUP)
As my party’s spokesman on health and women’s issues, I welcome genuine attempts by the Government to improve the lot of women generally. However, I have some issues concerning the objectives. The right hon. and learned Lady has said:

“We are creating the Commission for Equality and Human Rights—a single equality body for race, religion and belief, gender, disability and sexual orientation—and we are currently consulting on the Discrimination Law Review.”

What will the Government do to protect the Christian ethos of the United Kingdom, where currently we cannot have nativity plays or send Christmas cards because that is deemed to be offensive to ethnic minorities? Could the right hon. and learned Lady expand on that?

Also, in relation to recognised—

Madam Deputy Speaker
Order. I have stressed the importance of asking just one question, because so many people want to make a contribution.

Ms Harman
We have introduced legal protection against discrimination on the grounds of religion. There is of course no prohibition on people sending out Christmas cards; indeed, the House of Commons produces marvellous Christmas cards. We all send out box-loads of those cards and none of us has been prosecuted for doing so. As far as nativity plays are concerned, many hon. Members go to many nativity plays in primary schools, and long may they continue to do so.

Lynda Waltho (Stourbridge) (Lab)
Make no mistake: women welcome the Government’s focus on domestic violence and the progress that has been made over the past 10 years. However, those who work with and support victims, particularly women, are frustrated by the plethora of initiatives across Departments. I welcomed the comment about an inter-ministerial group. However, in the spirit of embracing talent, will my right hon. and learned Friend consider bringing on to that body people such as Sandra Horley from Refuge and women who work at Women’s Aid, who are the real experts, to assist that co-ordination?

Ms Harman
The initiatives that we have taken forward on domestic violence, such as specialist domestic violence prosecutors, specialist domestic violence courts and extra support for victims, are important and make a difference. The only problem with them is that they are not yet rolled out so that every part of the country is as good as the best. Because of those initiatives and showing that they work, we have been able to make progress.

I absolutely agree with my hon. Friend about the important work of Refuge and Women’s Aid. They are the organisations that work on the front line and they are the experts. In every hon. Member’s constituency there are women working to tackle domestic violence. They are the experts. We need to listen to them and ensure that we do more. There is a danger, however, in that we must ensure that, while saying that we will not tolerate domestic violence and are determined to act on it, we back that up with practical action, because there is a such a big need for change.

Bob Russell (Colchester) (LD)
A visible example of the inequality in society is the unequal provision of toilet and restroom facilities for women. What will the Government do to try to correct that imbalance in public buildings? Will the right hon. and learned Lady join me in condemning Tory-controlled Colchester borough council, which is building a public building worth £14 million, where 75 per cent. of the toilet provision is for males and 25 per cent. is for females?

Ms Harman
Toilet facilities are a big issue for women whose young children need to go to the toilet—they often find that shops will not let them use their facilities—and for older people, who are disproportionately women. My own view of how to solve this problem is to have more women local councillors. If, instead of only one in four councillors being women, there were equal numbers of women and men, these issues could move up the agenda and be discussed with purpose and without embarrassment.

Ann Coffey (Stockport) (Lab)
I welcome my right hon. and learned Friend’s statement and the Government’s commitment to dealing with issues of concern to women. Will she also press local authorities that are drawing up local social care plans to take into account the needs of women caring for elderly relatives? Those women’s needs often go unrecognised.

Ms Harman
My hon. Friend makes an important point. She has a background of expertise in social care based on a great deal of experience, including her work in the House. However good the social services are, it is important that older people and people with disabilities are also supported by their families. However great the health services, social services and voluntary sector may be, family care is essential as well. As part of that, we need to ensure that our planning does not only involve building lots of housing for nuclear families. The infrastructure of the community must include facilities for children—playgrounds, schools and nurseries—and it must also have housing for old people, including granny flats, sheltered housing and day centres. We need to build “family friendly” into the planning infrastructure.

Philip Davies (Shipley) (Con)
Does the Minister agree that we should be concerned equally about all prisoners with mental health problems, whether they be men or women? And if she really believes in equality between men and women, will she abolish her politically correct position, or at least create a Minister for men?

Ms Harman
When the hon. Gentleman’s party was in government, it had a spokesperson for women who was quite often a man—[Interruption.] The Minister for Women in the previous Tory Government was often a man. The hon. Gentleman will recognise that women are still under-represented in the House of Commons. Indeed, there are still only 17 Conservative women Members of Parliament. To the extent that they are ensuring that he enters the 21st century, we will back them up.

Charlotte Atkins (Staffordshire, Moorlands) (Lab)
I warmly welcome my right hon. and learned Friend’s statement. What steps will be taken to build on the excellent work of the Sure Start schemes, some of whose funding is coming to an end? They have transformed the lives of many vulnerable young children, and their mothers, in my constituency, particularly in Leek and Biddulph. They have done a tremendous amount of valuable outreach work and developed excellent children’s centres, creating a real legacy for the future.

Ms Harman
My hon. Friend makes an important point, and I know that she did a great deal to ensure that those two Sure Start centres were opened in Leek and Biddulph. The Sure Start programme is still being rolled out, and the first centres are in place. We all know from our experience of talking to parents whose children are in Sure Start centres that they are incredibly important for those children. We will be pressing on, irrespective of various bits of research that suggest that they are neither useful nor popular; we believe that they are both.

Steve Webb (Northavon) (LD)
My hon. Friend the Member for East Dunbartonshire (Jo Swinson) mentioned the 2010 pension changes, and I congratulate the Government on those changes, which will be of huge  benefit to many women. However, although some women will benefit to the tune of £20,000 to £30,000 over the whole of their retirement, it seems unfair to bring in the changes overnight, because that could result in someone who is only one day older suffering poverty throughout their retirement. May I invite the Minister for Women to co-ordinate a meeting between me and my hon. Friends and her colleagues in the Department for Work and Pensions to look at ways of phasing in the provision so that more women can benefit from the Government’s very good scheme?

Ms Harman
I know my colleagues in the Department for Work and Pensions are concerned to work with as wide a group of people as possible, and with both sides of the House, as we work together to tackle the pensions problem. The Minister for Pensions Reform will deal with those issues when he discusses Lords amendments under the next item of business before the House.

Mr. Adrian Bailey (West Bromwich, West) (Lab/Co-op)
I welcome my right hon. and learned Friend’s statement. Last summer, I spent a considerable amount of time with the Wolverhampton police domestic violence unit, which expressed real frustration with the problems it faces in getting women who are domestically abused actually to take legal action against their abusers. Will my right hon. and learned Friend undertake to incorporate the suggestions and ideas of groups such as the police—and, indeed, the voluntary sector, which my hon. Friend the Member for Stourbridge (Lynda Waltho) mentioned—in the formulation of her cross-ministerial policy?

Ms Harman
My hon. Friend makes an important point. Those who commit acts of domestic violence should be prosecuted and brought to justice; otherwise, the sense is that someone assaulting a person while walking down the street will be brought to justice, while someone assaulting a wife or girlfriend behind closed doors will get away with it. We need to get the message out that domestic violence is a crime that will be tackled, so it is crucial to bring offenders to justice. The difficulty is that many women fear that if they report domestic violence or give evidence in court, they will be even more at risk. That is why it is so important for support services—Victim Support, voluntary organisations and local authorities—to support women in taking action against perpetrators of domestic violence. I pay tribute to the many women who are prepared to go to court. They know that if they want to walk away from it and get on with their lives, they must ensure that the man does not get on and assault his next girlfriend.

Mr. Philip Hollobone (Kettering) (Con)
In demonstrating the seriousness with which the right hon. and learned Lady takes her role and acknowledging the importance of fair treatment for women in work, will the Minister for Women liaise with the Financial Secretary and the Minister with responsibility for prisons to stop the proposed closures of the tax offices in Kettering and the Prison Service office at Crown house in Corby? The work force at those places are overwhelmingly female, with women often working part-time and having child care responsibilities. In my view, the proposed closures of those offices are completely discriminatory. If the Minister for Women means what she says, those closures should be stopped.

Ms Harman
I am told that a gender impact survey is being carried out on the effect of those changes. I will draw the hon. Gentleman’s comments to the attention of my ministerial colleagues.

Anne Snelgrove (South Swindon) (Lab)
I thank my right hon. and learned Friend for the work as Solicitor-General she did for bereaved families—the Mullane family in my constituency, for example—after women have been killed through domestic violence. Is she aware of the excellent work done by the Wiltshire police, who have made domestic violence a priority, particularly by opening a domestic violence treatment centre in north Swindon? What discussions has she had with ministerial colleagues across Government to enable the lessons from such centres to be learned?

Ms Harman
The domestic violence homicide that took place in my hon. Friend’s constituency was a tragic killing of a woman and her young son. Clearly, important lessons must be learned from that experience. I am pleased to hear about my hon. Friend’s support for the work of the Wiltshire police. I would add that one thing that we should do is ensure that the substantive law is right. I am concerned when it is still possible for a man to escape a murder charge if he goes out, buys a knife, comes home and kills his wife as he has planned. If he can convince the court that he killed her only because he loved her and if he can secure the defence of provocation, the charge will drop down to manslaughter. That is why we need to reflect further on the substantive law and the message it sends out. We cannot allow the victim to be blamed after being killed.

Mr. Colin Breed (South-East Cornwall) (LD)
Does the Minister agree that the incidence of successfully prosecuted rape is significantly low by comparison with the number of cases referred to the Crown Prosecution Service? Is it not time to reconsider the tests used by the CPS, and to determine whether they are appropriate to the prosecution of rape cases?

Ms Harman
The test for a prosecution is, and I think must remain, whether there is enough evidence, whether a jury is more likely than not to convict on the basis of the evidence that there is, and whether it is in the public interest to prosecute. It will almost inevitably be in the public interest to prosecute in cases of rape.

I think that the rate of convictions for rape—convictions as a percentage of reported offences—is falling either because reporting is increasing as a result of an increased incidence of rape, or because women are now more likely to be confident enough to report it. Possibly it is a bit of both. However, we must do more to tackle rape. It tends to be a repeat offence, and unless the perpetrators are brought to justice there is a danger that further victims will suffer.

Dr. Roberta Blackman-Woods (City of Durham) (Lab)
I welcome the statement, and was pleased to hear my right hon. and learned Friend mention the Corston report and the need to implement its recommendations. Can she confirm that it will be a priority for her office to improve the services available to women when they leave prison and that, crucially, they will be available at the point of release to help prevent reoffending and women from falling back into the abusive relationships that often led them to prison in the first place?

Ms Harman
I think it extremely important not just for us to do more to prevent women from falling into offending, but for women who are sent to prison to be better prepared for life outside it. The work of the St Giles trust in my constituency involves former women prisoners meeting women as they come out of the prison gates to help them ensure that their lives stay on track.

Mike Penning (Hemel Hempstead) (Con)
At my constituency surgeries I regularly receive delegations from ethic minority groups, especially Kashmiri-Pakistani and Bangladeshi groups. They tell me that it is difficult for women to integrate and play a part in the community because they do not speak English, and that they are having terrible problems securing funding streams for the voluntary groups that are trying to help those women to speak English and become part of the community. Will the Minister tell us how that money can reach the front line? If she cannot do so today, will she meet a delegation from my community?

Ms Harman
My right hon. Friend the Secretary of State for Communities and Local Government will be examining those issues specifically. We need to ensure that women can work together to support other women in their local communities, and to support women taking up roles at work or in public life.

Mrs. Sharon Hodgson (Gateshead, East and Washington, West) (Lab)
I thank my right hon. and learned Friend for highlighting the Swedish model, and that country’s treatment in law of prostitution. It criminalises the buyer, who is usually a man, rather than the seller, who is usually a woman, which is interesting in view of the fact that its Parliament is rather more representative than ours in terms of gender balance. I believe that the balance is almost 50:50, if not more. Does my right hon. and learned Friend see any correlation between those two facts?

Ms Harman
I think that women’s representation in the Swedish Parliament means that an equal number of women and men have addressed the question of how to prevent women from being trafficked into Sweden and exploited for sexual purposes. The Swedes take the view that prostitution does not involve a working relationship, that it is not a job but sexual exploitation, and that in the 21st century we should hope for a better relationship between men and women than one based on men paying women for sex. I think that they have a point.

PENSIONS BILL (PROGRAMME) (NO.3)

Motion made, and Question put forthwith, pursuant to Standing Order No. 83A (Programme motions),

That the following provisions shall apply to the Pensions Bill for the purpose of supplementing the Orders of 16th January and 18th April 2007 (Pensions Bill (Programme) and Pensions Bill (Programme) (No. 2)):

Consideration of Lords Amendments

1. Proceedings on consideration of Lords Amendments shall (so far as not previously concluded) be brought to a conclusion three hours after their commencement at this day’s sitting.

2. The Lords Amendments shall be considered in the following order, namely 15 to 24, 1, 12 to 14, 28, 2 to 11, 25 to 27, 29 to 73.

Subsequent stages

3. Any further Message from the Lords may be considered forthwith without any Question being put.

4. The proceedings on any further Message from the Lords shall (so far as not previously concluded) be brought to a conclusion one hour after their commencement.—[Mr. Michael Foster.]

Question agreed to.

 Orders of the Day

Pensions Bill

Lords amendments considered.

Madam Deputy Speaker (Sylvia Heal)
I draw the House’s attention to the fact that privilege is involved in Lords amendments Nos. 1, 12 to 14, 16 to 18, 23, 24 and 27. If the House agrees to any of these Lords amendments, I shall ensure that the appropriate entry is made in the Journal.

New Clause

Lords amendment: No. 15, after clause 18, to insert the following new clause—Financial assistance scheme: scheme manager.

5.25 pm

The Minister for Pensions Reform (Mr. Mike O'Brien)
I beg to move, That this House disagrees with the Lords in the said amendment.

Madam Deputy Speaker
With this we may discuss Lords amendment No. 16 and the Government motion to disagree thereto and amendment (a) in lieu thereof, and Lords amendments Nos. 17 to 24 and the Government motions to disagree thereto.

Mr. O'Brien
The Government have great sympathy for those who have lost pensions through no fault of their own. They saved in a pension scheme and deserve certainty in retirement. That is why the Government set up the Pension Protection Fund—to ensure that what happened to 125,000 people does not happen to others. That is also why we set up a more powerful pensions regulator, and it is why this Government—and this Government alone—thought it right to help people whose pension schemes failed in the past.

Many Members of both Houses believe that more help should be made available, even if it should come from the taxpayer. We have already significantly extended the financial assistance scheme, and we have amended the Bill to get more money to more people immediately after it is enacted—it increases the interim payments from 60 to 80 per cent. If the Bill’s progress is delayed, that will delay payments to pensioners. We also set up the review of scheme assets, led by Andrew Young, the senior Government Actuary; and last week the Prime Minister reaffirmed our desire to lift assistance levels closer to 90 per cent. Following the publication yesterday of interim findings, I am optimistic that the Young review will help us to do that.

Mr. Nigel Waterson (Eastbourne) (Con)
Will the Minister give way?

Mr. O'Brien
If the hon. Gentleman allows me to say a little more and he wishes to intervene later, I will happily give way to him then.

The interim findings of the Young review strongly suggest that by making better use of assets within failed pension schemes we will be able to go beyond 80 per cent., and I am confident that we will be able to do so.

Our response to the interim findings constitutes part of our ongoing reconsideration of the ombudsman’s first recommendations. As part of that ongoing reconsideration, I am delighted to be able to announce that the interim findings have persuaded us that more money can be made available. The findings of the asset review do not show that some more money should not be made available.

The Government believe that the cost of extending the FAS towards the 90 per cent. mark can now be met by making better use of the assets remaining in pension schemes, matched by a further contribution from the Government. To achieve that, we will need the co-operation of every pension scheme. The commitment that we are announcing today is to match the extra funds that the review identifies with the goal of moving towards 90 per cent. of expected core pension for all recipients.

Those extra funds will be based on the amount of assets remaining in schemes. Trustees must continue to act in their members’ best interests, but we hope that they will now take the view that those interests might not be served by expending scheme assets on annuities. The Government will match the extra funds that the Young review identifies as and when they are released by trustees, and we expect that to be achieved as quickly as possible. We will write to trustees of the schemes concerned later this week to explain our proposals in more detail and to urge them to co-operate with us in getting a better outcome for all members.

I hope that that commitment will convince the House that the Government’s intentions are genuine and that this group of costly, complex and contradictory amendments should not be supported. They could involve significant undefined Government spending and damage our ability to help those who most need it.

Mr. Waterson
I would not like the Minister’s speech to get off on the wrong foot. Can he please clarify that there is a world of difference between a core pension and an expected pension, so talking about an expected core pension is a total nonsense?

17:30:00

Mr. O’Brien
Some pension schemes start at 60 or another defined retirement age, but we have made it clear that the financial assistance scheme will start at 65. There are some other aspects of particular schemes, including lump sums and so on, that might have been funded out of some of the schemes had they been properly funded. We know that they were not properly funded, but the Conservative party appears to suggest that the taxpayer should fund a lot more—

Mr. Waterson
indicated dissent.

Mr. O’Brien
It appears that the hon. Gentleman is not proposing that the taxpayer should fund such things. He suggests that it should be done, but he is not prepared to will the means to do it—[Interruption.] He accepts that he is saying that things should be done, but he is not prepared to put in place the means to do them. Well, as the Government, we need to ensure that what we promise we can deliver. The Opposition have shown, by the way in which they pursue these issues, that they will make all sorts of commitments but do not have the capacity to deliver on most of them.

Mr. John Redwood (Wokingham) (Con)
Can the Minister tell us how much money he is budgeting for the matching promise, which will be a welcome improvement?

Mr. O’Brien
It is the case that the DWP has within its funds sufficient money to be able to match fund the amounts that may come forward. It is a matched funding commitment and we expect that the Young review will identify some extra funding that will enable us to increase the amount of funding available for the pensioners. We have said that we will look at that issue, and our view is that we will be in a position to match demand in the approaching comprehensive spending review period and deliver the increase from existing departmental assets.

In terms of the Conservatives’ approach, let us consider amendment No. 17, which would launch the Conservative lifeboat—it is in many ways an opportunistic attempt to generate party political controversy on this issue. The interim report of the Young review has, essentially, debunked the notion propagated by the Conservatives that there are large amounts of unallocated assets in pensions and insurance accounts waiting to be plundered. That means that the increased costs of the proposal—the Conservatives want to go right up to Pension Protection Fund levels—would inevitably fall on the taxpayer. That is a potential cost of almost £2.7 billion over the next 60 years or £640 million net present value. The Conservatives have made no real provision for that. They told us that it would cost the taxpayer nothing and could all be paid for by the supposed unclaimed assets.

It is worth reminding ourselves that the Conservatives were repeatedly warned by, for example, Lord Turnbull, who said that using unclaimed assets would represent

“a flagrant departure from the principle of evidence-based policy making.”—[Official Report, House of Lords, 6 June 2007; Vol. 692, c. 1168.]

We now have the evidence from the Young review that shows this to be an uncosted amendment.

Mr. Gordon Prentice (Pendle) (Lab)
Does not the review specifically exclude bank and building society account assets? Would they not make a big difference if brought within its purview?

Mr. O’Brien
The unclaimed assets in bank and building society accounts are not included in the review, but—my hon. Friend may have missed it—those funds have been allocated to young people. I hope that he or the Conservatives, given that their lifeboat has been sunk by the Young review, would not advocate that we should raid the boat of the young and take their assets. That money is spoken for and is going to young people. The Conservatives may be shifting their ground, but we must not rob our young people to pay the old.

Chris Grayling (Epsom and Ewell) (Con)
I have two quick questions for the Minister. If his analysis is correct, why is the Young review continuing to look at the question of unclaimed assets? What is his assessment of the case study in appendix C of the review, which appears to set a clear precedent for recovering assets at a level more than sufficient to fund the lifeboat?

Mr. O'Brien
I notice that the Conservatives are apparently still claiming that there is funding in insurance and pension assets—or are they? It is not very clear what they are suggesting. The Young review said that it is very unlikely that those assets would lead to anything. Shall I read the foreword to the review? I do not want to risk embarrassing the hon. Gentleman.

Rob Marris (Wolverhampton, South-West) (Lab)
Go on, embarrass him.

Mr. O'Brien
I am being encouraged to embarrass the Opposition, but the Young review debunks the Conservative myth about pensions. Those involved in that review are continuing to look at the question of unclaimed assets, because that is what some people—including Opposition Members—have suggested. They do not think that that approach will lead anywhere, but they do believe that some of the assets in current pension funds should be aggregated. They believe that those assets could be sweated more efficiently, and combined so that annuities could be purchased in bulk, more money will be raised than was anticipated under the previous proposals.

Several hon. Members
rose—

Mr. O'Brien
The Young review has made it clear that neither the national insurance fund nor national savings are credible options. It makes it clear that defined benefit pensions and orphan assets will not provide the new source of funding that is needed. The Opposition should accept that their lifeboat amendment has been holed below the waterline: it is sinking fast and the time has come for them to abandon it. Our charge that the Opposition are guilty of fiscal irresponsibility is plain to everyone.

Additionally, the Opposition proposal adds complexity as pensioners could receive income from three different agencies—their pension scheme, the FAS, and the lifeboat top-up. That would make for a mangled bureaucratic nightmare, caused by the Opposition. They complained about the FAS, but now it seems that they want to duplicate it. The real question is whether the Government will do more for people, and what we have said today shows that we are prepared to look at ways of moving forward. In contrast, the Conservatives have merely brought forward uncosted proposals.

Geraldine Smith (Morecambe and Lunesdale) (Lab)
As a former trade unionist, I know a good deal when I see one. I think that what the Government propose is a good deal for people who have lost their pension funds. Will my hon. and learned Friend remind us how much taxpayers’ money is, quite rightly, being used to fund the Government’s scheme? Will he assure me that payments will be speeded up, so that people receive some income as soon as possible? Finally, does he agree that Opposition Members have displayed a touch of opportunism with their amendment?

Mr. O'Brien
I agree that Opposition Members have displayed a touch of opportunism. The Young review has ably demonstrated the vacuity of their lifeboat proposal, which is going nowhere else but down.

My hon. Friend the Member for Morecambe and Lunesdale (Geraldine Smith) is right that there is concern about the speed at which some of the payments are being made. I acknowledge that we have spoken to some of the trade union organisations that want the payments to be speeded up. I went to York recently to talk to the people running the FAS operational unit about why there were such delays. One of the major problems has been getting the required information from trustees, some of whom are good at providing it and others are a bit slower, but others have taken the view, for legitimate reasons, that this is not the right time to provide the information. They have taken legal advice, considered it and come to the view that they do not want to give the information at present. A variety of reasons are involved.

I have looked at how some of the payments are being made and we stand ready to make payments as soon as the trustees decide that information should be forthcoming. Many more people are now receiving payments and we stand ready to make further payments as soon as possible. The money is there. We are ready to make the payments and when we get the information we shall do so.

Richard Burden (Birmingham, Northfield) (Lab)
May I take my hon. and learned Friend back to his comments about the matched funding commitment? The message I seem to be getting from the review team’s interim report is that there could be more money than was initially thought, including well over £1 billion in the assets of failed schemes. When my hon. and learned Friend talks about matched funding up to the level of the core pension, does he realise that above what is designed as core pension there are things such as widows and dependants’ benefits? Can he assure me that he will not impose a limit by saying that those things will not be funded if it turns out that there is enough money from the other assets recommended by the review team and the matched funding commitment he made today?

Mr. O'Brien
My hon. Friend raises an important issue. We have to look at where we are going in terms of the Young review, which was asked to see how much we can sweat out of the assets. My hon. Friend is right to say that the amount in failed schemes is well in excess of £1 billion. That gives us a fair amount of resources and if we can aggregate them, bulk them up and bulk buy, we can certainly go beyond 80 per cent., as the Government have indicated. However, what I cannot tell my hon. Friend at present is how much will be available in terms of the Young review. The review needs to come to fruition and we need the report. It was scheduled for the end of the year, but I have asked for it to be brought forward to November so that we can see it earlier, because I am conscious that a large number of people are waiting on the outcome of the review.

Alan Simpson (Nottingham, South) (Lab)
The Minister places great store by the initial comments of the Young review, but is he aware that in a similar review of unclaimed, orphan assets in banks and building societies in Ireland, it was originally predicted that after the searches had been fully conducted no more than €3 million was likely to be found, but in the event €196 million was found—60 times more than claimed? At this stage, is not it a bit premature to make a presumption that would close the door on the possibility of finding funds in the UK that diverged on a similar scale? Why is the Minister so keen to block off that route, which could get a lot of us off the hook?

Mr. O'Brien
With respect, I think that my hon. Friend is over-optimistic as a result of what happened in Ireland. Andrew Young and his colleagues are looking at a number of schemes and we are aware, broadly, of the amount in them. The question is whether we can more easily access those resources, get the trustees, under their legal terms, to bring the resources together and bulk them up, and then whether we can use them better to purchase annuities. That is the approach Andrew Young suggested. He is not optimistic about the view that we can identify vast other sums that would be easily available, so although I appreciate the situation in Ireland, the Young review does not suggest that it is anything like that in the UK.

17:45:00

Stewart Hosie (Dundee, East) (SNP)
The Minister has talked about sweating assets and bulking up the pot in the first instance, but when the Department for Work and Pensions does the calculation for FAS liability at the moment, it takes the expected pension, multiplies it by 80 per cent.—for the time being—and then reduces it by the notional annuity already produced by transferred lump sums that may have gone to individual scheme members. In the calculations that I have seen—I have an example here from the DWP—the rate of return on that lump sum is quite extraordinary, unsurprisingly leading to a zero FAS liability. Even if the annuities or transferred sums were aggregated, I find it almost impossible to believe that that total capital asset could be sweated any more than it is being at the moment. My instinct is that the end result, in terms of FAS liability, would be the same and the pension going to any failed scheme member would be the same. How does the Minister think that the Government, or another body, could sweat more out of those assets than is currently being done?

Mr. O'Brien
I suggest that the hon. Gentleman read the report by Andrew Young. It bears reading through. It is complex, and involves a lot of issues, but the key point that it raises is that if one were able to bring together the assets in the various failed pension schemes, that would give one a greater purchasing power in the market. If one were able to put those assets into another annuity—a single annuity or a small number of annuities—that would increase the purchasing power of the amount of resources.

I am dealing with a report by the deputy Government Actuary, who knows his business. To some extent, we have to proceed on an evidence basis and the evidence that Andrew Young came up with, after talking to a large number of people in the industry, shows that it is possible to do more than we thought. I do not share the hon. Gentleman’s pessimism, but if he asking me whether I can guarantee that all this can be done, I have to say that all I am relying on at the moment is that the Young review has done a considerable amount of work—it seems a very good job to me—and I hope that we will be able to get a genuine response from that.

Miss Anne Begg (Aberdeen, South) (Lab)
Has my hon. and learned Friend had time to assess whether, if it is possible to roll up those pension funds that have not yet annuitised, primary legislation will be required—particularly for those funds that are pretty close to annuitising—to prevent them from doing that at the moment, to provide a chance to see whether we can get a better deal for pensioners through the proposals in the Andrew Young report?

Mr. O'Brien
My hon. Friend raises an interesting and important point. As I have already indicated, we will suggest to the trustees of pension funds, who have their own legal obligation and will need to take their own legal advice, that they need to look carefully at this matter. If it is the case that bulking up the various funds would enable us better to bulk purchase annuities, that would on the face of it appear to be better for the members, and the trustees have to take that into consideration. In the end, we are going to have to rely on trustees to look at the facts, examine their fiduciary duty to their members and ensure that they make the right judgment. The important thing is that the Bill moves to Royal Assent, so that we can increase the level of initial payments, meaning that more people will benefit immediately. Those are tangible commitments by the taxpayer that will make a real difference to people’s lives.

Amendment No. 24 is about the FAS being at Pension Protection Fund levels. The amendment does not disguise extra public spending as a lifeboat fund or pretend that unclaimed assets could get close to covering the costs. I admire its honesty, while questioning its effect. We estimate that moving from 80 per cent. on the FAS to PPF levels just like that would cost the taxpayer £2.7 billion, or £640 million, net present value. The cost would be low at first, but then rise rapidly as more people retired.

Danny Alexander (Inverness, Nairn, Badenoch and Strathspey) (LD)
Will the Minister give way?

Mr. O'Brien
I would like to make progress, because I have given way quite generously and I am conscious of the time. Other people want to speak and it is a time-limited debate, but I will give way to the hon. Gentleman before I draw my remarks to a close.

We believe that the current FAS benefits of 80 per cent. are helpful, but that does not mean that we think that 80 per cent. is the most that people should get. That is precisely why we asked the assets review how we could get closer to a figure of 90 per cent. through better use of the funds held by qualifying schemes. Amendment No. 24 fails to take account of an essential difference between FAS and PPF payments. If FAS payments had to be equal to PPF payments, without account being taken of the pensions paid by schemes—that is what would happen under the amendment—some members would receive considerably more than PPF levels of benefit, because a member would receive 90 per cent. of their benefit from the FAS in addition to the pension that their scheme was able to pay them. I do not think that that was the intention of those who drafted the amendment; it is just poorly drafted, and I invite the House not to support it.

Let me turn to amendments Nos. 18 to 21 on the proposal to set up a pensions unclaimed assets recovery agency. As I have already said, the assets review exposes the Tory myth that additional spending commitments can easily be funded through unclaimed assets. That is confirmation of the powerful arguments made by Lord Turnbull, the Association of British Insurers and my right hon. Friend the Member for Birkenhead (Mr. Field), who warned the Opposition repeatedly about their opportunism, and the lack of understanding unpinning the proposal. We are already exploring the potential of assets in failed pension schemes, and we have said that we will use them to supplement the FAS payments, if we can do so without incurring an unacceptable risk to the taxpayer.

The Opposition have raised false expectations about the assets that there might be, and setting up an agency of the kind proposed is likely to prove enormously expensive. The cost of setting it up could conceivably be more than the value of the assets; we just do not know. [Interruption.] Well, as far as I can see, it would probably cost more than the sum paid out, so we are probably looking at another £20 million or £10 million. The hon. Member for Epsom and Ewell (Chris Grayling) chunters away on the Front Bench, but I ask him: what will it cost to set up the agency?

Chris Grayling
May I ask the Minister whether he is proud of the fact that his Department has presided over the setting up of a FAS that costs more to administer than it has paid out in pension payments so far? Is that not an absolute scandal and a disgrace, and is it not a sign of the failings of the Government?

Mr. O'Brien
I notice that rather than answer my question, the hon. Gentleman tried to bluster and attack. He can make his points about the FAS, and I will happily deal with them, but he is making another uncosted spending commitment. He does not know the cost of what he wants to do. He is making all sorts of commitments in order to score points. The Conservative party is the sort of party that makes such commitments, but basically it does not know what it is doing. Setting up such an agency is likely to prove enormously expensive, and amendments Nos. 18 to 21 are redundant as a result of the Young review. It is not sensible to try to guess what level of support could be funded. If we can bulk up assets and bulk-buy annuities, we are likely to be able to provide more support; we do not need to go down the route of setting up the pensions unclaimed assets recovery agency, which would be a rather strange body.

Danny Alexander
The Minister is on the important subject of costs, and he makes the point that it would cost £640 million, net present value, to provide PPF-level benefits to people who have an entitlement under the FAS. According to written answers received by my noble Friend Lord Oakeshott in the House of Lords, that would amount to £25 million a year for the next 10 years. To the victims of the occupational pension schemes that collapsed in so awful a manner, that seems a relatively small amount of money to pay to ensure that they get a fair and just level of benefit.

Mr. O'Brien
Obviously, the payments will be made over 60 years, and there will be a sort of bell curve; the amount paid out will start off quite low, and then get pretty big. The hon. Gentleman should recognise that although there will be some smaller early payments, payments will increase as people start to retire. We will be a good way into those 60 years before we reach the point on that bell curve at which the payment levels come down. When he talks about £20 million a year over 10 years, he is being somewhat optimistic. We are looking at an amount just in excess of that over the next two or three years, but then the figure will start to rise.

My hon. Friend the Member for Cannock Chase (Dr. Wright) and others on the Public Administration Committee are concerned about the fact that schemes with solvent employers are excluded from the FAS. That is a complex subject, so we asked those carrying out the Young review to come to a considered view on whether some schemes of that type should be helped by the Government, rather than the employer who made the pension promise. When we developed the FAS, we tried to ensure that taxpayers’ money will not fund assistance where there is an employer who could or should take some responsibility, including in cases where there is a moral, if not a legal, obligation. However, we are aware that there may be some schemes that are currently not covered in which members face a comparable loss to others in similar circumstances.

I cannot provide an assurance that all schemes, irrespective of whether the employer is solvent, will qualify for the FAS. The review indicates that not enough information is available on the circumstances of schemes with solvent employers, and it has begun a data collection exercise that will inform its conclusions later this year. In the meantime, it would not be right to absolve employers or trustees from their responsibilities to members. Some of the schemes are still winding up, and scheme members are hoping to bring pressure to bear on employers, so that they make contributions to the fund. There would be little incentive for trustees rigorously to pursue such cases, or for employers to respond sympathetically, if the Government indicated that all the members were likely to be helped under the FAS.

In a number of cases involving FAS qualifying schemes, employers have gone beyond their legal obligations as a result of trustee persistence. Employers are extremely unlikely to be willing to reach into their pockets if the Government step into the breach in every case, regardless of the circumstances. I do not want to pre-empt the review and make any open-ended commitments involving taxpayers’ money. We provisionally estimate that the cost of including solvent employer schemes would be more than £400 million, but frankly, we do not really know. We are trying to get more information. I understand the concerns expressed by my hon. Friend the Member for Cannock Chase, but I will not sign a blank cheque for solvent employer schemes—as their number still needs to be established, we do not know the cost to the taxpayer, and there is still the possibility of employers being expected to make a contribution. That said, as he knows, a review is under way, and it will report later this year—in November, we hope. Also, there will be a further Bill on pensions, and that will enable such issues to be raised. Given the lack of information, given that we can gain further information by the end of this year, and given that there may be further opportunities to consider the matter later, I ask him to consider not pressing his amendment.

I shall move on as speedily as I can. We understand the thinking behind amendment No. 22, and that is why we commissioned the work of the assets review. In a statement this morning, I said that trustees should consider their approach to annuitisation, given the commitment that the Government have made, and at the start of my contribution I set out the further commitment that we made today. At this stage, it would not be desirable to compel trustees to a particular course of action, but they have heard what I said, and I ask them to take it into account. When they make annuitisation decisions, they will need to consider their legal advice, and how best they can serve their members.

Amendment No. 23 is on account payments. We may disagree about how to fund assistance, or about the level of assistance that should be paid, but we all agree that affected members should receive payments from the FAS as soon as possible. Amendment No. 23 would result in the opposite: it would threaten the timely delivery of assistance to qualifying members. That is my concern. To make the amendment work, hundreds of pension scheme administrators would have to administer what would, to them, be unfamiliar processes. They would expect to be paid for doing so, and that would further deplete the value of scheme assets available to members. That could lead to higher top-up payments, the cost of which would ultimately be borne by the taxpayer. Schemes that had already wound up and had no trustees would still have to rely on the FAS to make payments. To apply for loans, schemes must assess whether they could afford to make on-account payments, which would increase administrative costs and complicate administrative processes for them and for the FAS, further delaying payments and the completion of wind-ups. Ros Altmann herself has said that operating a scheme in line with the amendments would not be straightforward. On this occasion I am pleased to say that I wholeheartedly agree with Dr. Altmann’s prognosis.

The expertise for delivering FAS payments lies with the FAS operational unit. Where data are received from trustees, FAS payments are assessed within about a month. The amendment would mean even greater costs and fewer payments. Lords amendment No. 15 would transfer certain functions to the Pension Protection Fund. I have visited the FAS operational unit and discussed how payments are made. It told me that it is ready to make payments as soon as information is received. I accept the concerns that some hon. Members have expressed, but I am not in a position to make an announcement about the issue.

18:00:00

Mr. Waterson
I appreciate that the report is hot off the press. Is it not inherent in the Young report that it would make sense to fold the administration of the FAS into the PPF itself?

Mr. O'Brien
I hear what the hon. Gentleman says, but if he spoke to the PPF members he would find that they would want an awful lot of reassurance before that was done. The pensions industry, too, would require a great deal of reassurance. If the Lords amendment were accepted, it would create a lot of concern in the City. We can see how the Conservative party is operating in relation to the issue if it is prepared to make decisions without consultation or without ensuring that people who have to deal with those problems understand the full implications. If the measure were to be introduced, that would have to be done after appropriate consultation.

I have spoken at length, and this is a short debate, so I shall conclude. As all parties acknowledge, this is a difficult area and it is important we get it right, both for members who want certainty and security and for taxpayers, many of whom do not have defined benefit occupational pension schemes. The Young review remains our best option for reconciling the priorities of taxpayers and of members of those pension schemes. While a lifeboat fund is superficially attractive, it does not come with the necessary funding. Indeed, it is a sunken lifeboat after Andrew Young’s review. We need to see if we can find a better way of dealing with the issue, and the Andrew Young report shows that there are such ways. It would be irresponsible and cruel of any Government to make promises not knowing where the money will come from to pay for them, so I will not do so.

The interim findings of the Young review are an excellent start. The further commitment that the Government have made today provides additional support for pensioners and shows that we are doing practical things to help them. The Opposition are making wild gestures without looking properly at funding. The Bill must be enacted without the Lords amendments because it will enable us to pay more in initial payments to more people immediately. We have already pledged to raise assistance to 80 per cent., to raise the cap and to get rid of the de minimis requirement. Pensioners are waiting for the money, and we are prepared to pay it to them. We have made a further commitment today. I want our commitments to be delivered, and I want the Young report to be delivered in November so that we have a better opportunity to deliver for pensioners. The Government have ensured that they are addressing those issues seriously, in marked contrast to the way in which the Opposition have behaved throughout.

Madam Deputy Speaker
I must correct the record in relation to the amendments in which privilege is involved. Privilege is involved in Lords amendments Nos. 1, 12 to 14, 16 to 18, 23, 24 and 73, but not Lords amendment No. 27 as previously stated.

Mr. Waterson
I welcome the Minister to our debates on the Bill. It might have helped if he had read the Young report and our amendments properly, but he is new to the job, so I shall try to help him. He spoke for nearly 40 minutes, and we have a total of only three hours to debate all the groups of amendments, so I shall try to do better than him. The next group of amendments is important to many people, including the Equal Opportunities Commission, and it would be a great shame if it was not possible to debate it, particularly as we have just heard a statement about priorities for women. It would show a very odd sense of priorities if the Government did not want to have time to debate the second group of amendments.

Mr. Mike O'Brien
May I protest a little? I accepted a lot of interventions to ensure that Members’ questions were answered.

Mr. Waterson
I take the Minister’s point, and he was characteristically generous in accepting interventions. Let us hope that his colleagues are sufficiently restrained so that we can get on to the rest of the business.

I should like to distance myself from Lords amendment No. 24, which was tabled by the Liberal Democrats in the other place. It is the only amendment that proposes to use extra taxpayers’ money for the problem. May I right the wrong in the Minister’s speech, as that is certainly not the intention in our package of amendments, which stand or fall together? It is an obvious analogy to make, but he said that the lifeboat was holed and was sinking. However, it is the pension victims who are already drowning—the Minister should remember that.

May I pay tribute to their Lordships for giving their support on a genuinely cross-party basis to the amendments, which collectively provide a lifeboat fund to help the victims? We will vote for them as a package. I am sure that I do not need to make the case for helping the 125,000 people who have lost their pensions, as the Minister conceded, through no fault of their own. They have made their own case through their courage, persistence and dignity. We have helped them to make that case in debate after debate and Question Time after Question Time.

In recent weeks, we have heard a great deal about the new Prime Minister’s “moral compass”. He has spoken endlessly of change, and promised an end to the culture of spin. Yet the reality has been more of the same. Over the past few days, the Government have been frantically spinning in the media that the amendments are flawed in some way, that the unclaimed assets do not exist and so on. The Prime Minister likes to claim, as the Minister did today, that as things stand under the FAS, the victims will receive 80 per cent. of their pensions. Indeed, he told GMTV recently:

“Every single one of the 125,000 will get back at least 80 per cent. of their pension.”

We all know that that is wholly inaccurate and misleading. The new Secretary of State is clearly a fast learner. In his first appearance at the Dispatch Box, he confused “expected pension” with the Government-created concept of “core pension”. He was at it again in The Independent today. He said:

“We believe we will be able to move the 80 per cent. guarantee”—

that is the word that he used—

“from the taxpayer further towards 90 per cent.”

The Minister himself talked about the expected core pension, which is a ludicrous concept that puts together the expected pension—what people expect to receive—and the core pension, which is a construct of the FAS. 

Only the other day, in unveiling his “Not the Queen’s Speech”, the Prime Minister referred to an unclaimed assets Bill to be introduced later this year. He challenged us to support it, but failed to make any connection between the use of those assets and helping the pensions victims. It is as if he wished they would disappear. Sadly some of them have done so, and some of them will. That 80 or 90 per cent.—of what is it 80 or 90 per cent.? The truth is that the FAS was set up in a hurry as a political expedient and was inadequately funded from the outset. It had to be set up in a different location with different staff almost to underline the fact that it was always going to be the poor relation to the PPF. Then the Government had to invent the novel concept of the core pension to make it sound even remotely credible. What does that mean in practice?

The PPF includes some inflation linking; the FAS has none. The PPF pays from the scheme pension age, but the FAS only at 65. The FAS does not allow for tax-free lump sums, or ill health or early retirement benefits, except for the terminally ill. The FAS does nothing for dependent children and little for widows. So most victims subject to the FAS will be lucky to get half their expected pension, and many will receive far less.

If the era of spin is at an end, why will the Government or the Prime Minister not listen? They were found guilty of maladministration by the ombudsman. They decided to ignore constitutional law and practice by saying that it was Ministers’ job to second-guess the ombudsman on those findings. The Select Committee told the Government that they were wrong. They ignored it. The European Court said that the Government were wrong. They ignored it, too. The High Court told them, so they decided to appeal.

Now, in an almost unprecedented move, the Select Committee has issued a report aimed directly at today’s debate and giving guidance to hon. Members on how to vote. Reading between the lines, it is clear that when these matters were last debated in the Chamber, the able Chairman of the Select Committee felt that he was led up the garden path by the then Minister. The Select Committee supports the view that those who have lost pensions where a solvent employer has wound up the scheme should also be included. That is the purport of amendment (a). The Committee states that

“the losses suffered by scheme members are identical, whether or not an employer still exists.”

That is the nub of Lords amendment No. 16.

Mr. William Cash (Stone) (Con)
Does my hon. Friend agree that although the proposal announced by the Minister with regard to a review must be taken seriously, that is a step backward from what was said by the former Minister in the House, when far greater emphasis was given to the need to protect those who were affected by schemes that were solvent? We therefore want meetings with the Minister. My constituent, Richard Nichol, and the people who fought valiantly on the matter will look to our Front-Bench team to help them in that, as they have already done.

Mr. Waterson
I am grateful to my hon. Friend for that intervention. Yes, there was some lack of clarity—that is the most charitable way of putting it—about what the then Minister said in response to the hon. Member for Cannock Chase (Dr. Wright), as a result of which his amendment then was withdrawn. The hon. Gentleman is back for another bite at the cherry and I wish him well with that.

The Select Committee has some harsh words for the Government’s current position on trying to force employers to do the decent thing. It says:

“the Government should not use the indigence and distress of those who have suffered considerable losses to try to blackmail them”.

On the pensions lifeboat, the Committee could not be clearer in it support. It states that it supports

“the general principle that FAS benefits should be aligned to those in the PPF”

and it urges the Government to find ways of speeding up payment by the FAS. Amen to that.

Most unusually, in my experience, the Select Committee urges hon. Members to think carefully about using the Bill to get help to those who need it. It says:

“the House should consider any government assurances extremely carefully before it gives up this weapon.”

Once bitten, twice shy.

Dr. Tony Wright (Cannock Chase) (Lab)
For the sake of accuracy, and as he is quoting us liberally, I am sure the hon. Gentleman would want to record the fact that we say:

“Any assessment of the increase in benefit”—

that is, from the review—

“can only be speculative. We do not have the expertise to comment on whether the proposals for a review of unclaimed assets stand a realistic prospect of success.”

I am sure the hon. Gentleman meant to add that.

18:15:00

Mr. Waterson
I am sure that is right. I appreciate that it is not for the hon. Gentleman’s Committee to make such judgments.

The centrepiece of the Minister’s speech tonight—the lifeboat towards which he has been swimming for most of the evening so far, but making little progress—has been the Young report. I agree that it is a useful document, as far as it goes. It is, of course, an interim report and seems to have been rushed out in an attempt by Ministers to bolster their position on the Bill. There is clearly more work to be done by Mr. Young and his colleagues, and I think he accepts that. My overall mark so far is six out of 10—must try harder.

We welcome parts of the report. It is correct to conclude that the funds available for the victims can be boosted by not purchasing bulk annuities. That is not rocket science. We have been saying that for quite a long time and campaigners such as Ros Altmann for even longer, yet Ministers have taken no notice at all. I am pleased to see that in their response to the Young report, Ministers have finally seen the light. But there is a massive danger that faces us this evening. The hon. Member for Aberdeen, South (Miss Begg) touched on it in her intervention. It explains why, forgetting all other arguments for and against, hon. Members in all parts of the House must support the amendments tonight.

As wind-ups of schemes proceed, many of the assets identified by Young could be dissipated by purchasing annuities in bulk before the review team produces its final report at year’s end. We must not allow that to happen, or much of this will become academic. That is the aim of amendment No. 22.

Mr. Edward Garnier (Harborough) (Con)
Is there not a further danger in relation to the purchase of annuities? Recently, compared with previous years, annuities have been performing pretty poorly. They have not been giving annuity holders the income that they might have given, say, 15 years ago. Is that not a further concern for those with broken pensions? Are they not also entitled to be concerned about what has happened to their additional voluntary contributions and about the sloth with which the Government have sought to mend the broken pensions? I am thinking particularly of my constituents who have seen their British United Shoe Machinery Ltd occupational pensions go down the Swanee, and have received little comfort from the present Prime Minister or the previous Chancellor of the Exchequer.

Mr. Waterson
I am grateful to my hon. and learned Friend for that intervention. I know that he has been a doughty campaigner for the British United scheme members who lost many of their pension rights. He is right about the annuities market. An interesting and thoughtful document was produced by the Treasury a few months ago on the subject.

Almost by definition, if pension funds are to be wound up without sufficient assets and the money is to be used to purchase annuities in bulk, the money will not go as far as it might otherwise do. We entirely agree with Mr. Young about that. Belatedly, the Government also seem to agree, but all the Minister can say, rather wetly, if he will forgive me, is that the trustees must take their own advice. It is little more than a nod and a wink, whereas amendment No. 22 would make it crystal clear that they must stop purchasing annuities in bulk for the foreseeable future so that we can get the money going through the system to help the people who need it most.

Danny Alexander
The hon. Gentleman is making a critically important point. If what the Minister said is to be taken at face value, surely at the very least the Government should be advocating voting for amendment No. 22 to stop the assets being converted into annuities, or the money that he hopes will come in November when the Young review re-reports might be unavailable because by then it will have been annuitised.

Mr. Waterson
I am grateful to the hon. Gentleman for that intervention. I repeat what I have already said. If hon. Members are oblivious to all the other arguments on the issue, this is the central argument that should make them vote for the amendments tonight, especially amendment No. 22.

It is good news, at least for the moment, that the report concludes that there are some £1.7 billion of uncommitted assets in FAS eligible schemes. We agree about making better use of those assets. And glory be! Young also concludes that there would be advantages in operating the FAS along the lines of the PPF. The Minister seemed a bit iffy about that, but I recall tabling amendments to the 2004 Bill, as it then was, proposing just that: a separate fund—it must be separate, for obvious reasons—for existing claimants, operated in parallel to the PPF and by the same people, using the same skills set. We have consistently argued more recently that the failing FAS should be scrapped as a separate entity and folded into the PPF administration, which has shown itself to be efficient and cost-effective under the leadership of Lawrence Churchill. However, one of the galling aspects of opposition is that being proved right all along is not good enough.

Mr. Mike O'Brien
I really cannot allow the hon. Gentleman to get away with that. He has been saying all along that unclaimed personal pensions and life assurance policies would provide a lifeboat for the various pensioners. Will he now accept that Andrew Young’s report, published yesterday, makes it clear that unclaimed personal pensions and life assurance policies have a very uncertain outcome and although they might theoretically provide a source of funding, there would be substantial administrative, legal and other difficulties behind such a scheme? In other words, what he kept saying was going to provide the answer in fact provides no answer at all.

Mr. Waterson
I can assure the Minister that I am not going to do what he did, which was just to pick out the bits of Young that helped his case and leave the rest. I will deal with that aspect in detail later, and if the Minister feels that I have fallen short he is welcome to intervene again.

It is a tragic lost opportunity that the Government have been so slow to consider unclaimed assets as a source for topping up assistance to the victims. We raised that during the passage of the Pensions Act 2004; the right hon. Member for Birkenhead (Mr. Field) had raised it much earlier. The mantra from the Treasury at that time was always the same: “Just because these assets are unclaimed does not mean that they do not belong to somebody.” Then suddenly the then Chancellor, now the Prime Minister, turned 180° and announced that he would be looking to use unclaimed assets, albeit for a different purpose.

The Government have made much mischief on this subject. They have sought to rely heavily on some comments—now overtaken by events—from their new best friends, the Association of British Insurers, attacking the possible use of trust-based pension assets. For the record, we accept what the ABI says on that specific category, but—this may be helpful to the Minister—nowhere in our amendments on the lifeboat fund do we seek to specify which unclaimed assets could be appropriate for this purpose. That would be left to regulation and to the Secretary of State, and, arguably, to the final Young report. No doubt that makes organisations such as the ABI somewhat uncomfortable. I can understand that, because its job is to look after the interests of the companies who are its members. However, that does not alter the fact that in different ways, and for varying purposes, both Government and Opposition are looking to turn unclaimed assets to the benefit of people in our community who need help. I suspect that now the ABI’s greater concern is the briefing from Government sources over the weekend suggesting that as part of the ongoing review they were going to look seriously into using the inherited estate of insurance companies—said to amount to some £20 billion.

The Young report avoids the issue of bank and building society assets because, it says, those are being considered by the Treasury, but we can safely assume, for these purposes, that significant amounts of money are available from those sources. Young goes on to deal with some ideas that have certainly not emanated from us, such as windfall taxes or additional levies on business. Perhaps they came from the Liberal Democrats. With wry amusement, I see that Young concludes that voluntary contributions from business are not

“a credible source of additional funding”.

We said that when it was mooted by the then Pensions Minister back in 2004. The report dismisses somewhat tersely the use of unclaimed assets held by National Savings and Investments, and we would wish to look at that again as part of the group’s ongoing work.

Rob Marris
Can the hon. Gentleman distinguish between orphan assets, which have been much talked about in this Chamber for all kinds of pet projects over the years, including for youth provision, and what is commonly termed the inherited estate? I have a life assurance policy that will not pay out what it was expected to, yet the company has inherited estate assets which could be divided between shareholders and policyholders, such as myself and my wife. I do not want the hon. Gentleman coming along, as a result of these amendments or regulations consequent upon them, and nicking money that could come to me as a policyholder.

Mr. Waterson
I am grateful for the hon. Gentleman’s intervention, which was as penetrating as ever. I think he should be more worried about what his own Front Benchers have in mind, given the briefing over the weekend. He is absolutely right. The insurance companies argue that those funds are available to improve the lot of policyholders such as himself and his good wife. At least one or two companies are considering court applications—it must ultimately come down to that—to divide the booty between policyholders and shareholders. [Interruption.] The hon. Member for Wolverhampton, South-West (Rob Marris) says from a sedentary position that I want to take it. He needs to read what has been said over the weekend, which suggests that his own Government are thinking of taking it.

Mr. O'Brien
Before the hon. Gentleman makes an allegation like that, he should remember that it is precisely these sorts of funds that he and his colleagues have been saying are unclaimed assets in insurance and pension funds. We have repeatedly warned him, and he has been warned by others, that they are not available, yet now he is trying to claim that the Government want to access them. The Government have never made any such claim—it has always been made by the Opposition.

Mr. Waterson
I think that the Minister is failing to distinguish between the inherited estate of insurance companies and unclaimed pension assets. However, I will come to that in a bit more detail in a moment.

Alan Simpson
Will the hon. Gentleman give way?

Mr. Waterson
I should like to make a little progress.

The report goes on to talk of the need for primary legislation to enable unclaimed assets to be utilised. We now know, fortuitously, that the Government intend to introduce an unclaimed assets Bill, for the Prime Minister has told us so. Should the amendments fail in due course, that would be a golden opportunity to remedy the situation. Perhaps the Minister could deal with that when he responds. We are heartened that the report concludes:

“there may be additional funds available in further types of unclaimed assets and the Review team will investigate these further before our final report is produced.”

The Minister is wrong to say that the interim report closes the door on the use of unclaimed assets. I note that the review team is intending to continue to investigate the legal and other issues surrounding unclaimed assets, although they reach some provisional conclusions on unclaimed defined benefit scheme assets and so-called orphan assets. Like the Government, we shall consider the implications of those provisional findings. For those who favour the use of unclaimed assets, there is real encouragement in the report—the Minister clearly did not get as far as annexe E—as regards the experience in the Republic of Ireland. A comparison with what it achieved scaled up for our larger population suggests that we might generate £234 million in the first year and £70 million a year thereafter. The report is a good start to the process, and we are told that the final version will appear before the end of this year.

In fact, however, this is all beside the point. I had harboured hopes, based on my respect for the new Secretary of State and the new Pensions Minister, that they would come to these issues with fresh minds. The history of the FAS since its birth in May 2004 has been a dismal disappointment. Things have merely gone from bad to worse. In its annual report, it revealed that it spent more on running itself than it got to the victims. The latest number receiving payments—about 1,300—is only a fraction of the 10,000 who have reached retirement age and need help now.

Let us consider the appalling case of Mr. John Brooks, a constituent of my right hon. Friend the Leader of the Opposition, who has been deeply involved in his case. Mr. Brooks is 68 and suffers from leukaemia. He worked for 38 years for Early’s blanket factory in Witney, but when the business collapsed in 2002 he was left without a company pension. He is one of about 50 people in the same situation. He was recently contacted by the FAS, which offered him 60 per cent. of his full pension in the form, at least initially, of a loan. He said that he would not accept it because he wanted to know if the other 49 people were being offered the same thing. He then got a phone call from someone at the FAS. What he said is quoted in the Oxford Mail:

“I asked him if anyone else from Early’s was being offered money and he said no, you are the squeaky wheel that we have got to grease.”

That sums up not only the gross incompetence of the FAS, but its lack of any kind of moral status in carrying out the proper compensation of these victims.

18:30:00

There are others, such as the Cheshires. Marlene Cheshire, the widow of David Cheshire, contributed to the Dexion scheme for 30 years. He died of cancer in 2005. He could have taken early retirement, instead of retiring at the normal age of 62. His widow will receive just £56.98 a week from the FAS, but he would have expected her to receive an estimated £113, including indexing. Mr. Andrew Parr, a member of the ASW Sheerness scheme, will receive 40 per cent. of his expected pension from the FAS. At the age of 62, he should have been getting £336.96 a week—he will now be getting just £134 a week, and he is still working despite having a heart problem.

It is not just a matter of statistics, but of real people facing real problems. When will Ministers understand that those people and their families need help now? The niceties and technicalities of sorting out underutilised remaining assets in the funds, non-purchase of annuities and unclaimed assets will take time; we accept that. However, if the Government had listened to us, that could all have been happening during the past two or three years. It is precisely because the process will take time, and because those families need help now, that along with other parties and some Labour Members, we are proposing not just a lifeboat fund but that initial funding should be provided through Treasury loans. Those would be repaid in due course and are based on the way in which the Maxwell victims were treated.

Rob Marris
What these people have gone through is awful; we are all aware of that. In the figures that the hon. Gentleman has given, he says that individuals will receive 40 per cent. rather than 80 or 90 per cent. Is he committing his party to pay the full 100 per cent. of expected pensions, and if so, what would that cost the Government?

Mr. Waterson
We are committed to find ways, as set out in the amendments, to ensure that people receive compensation at PPF levels, without incurring further taxpayers’ money, and we think that the Government should be doing that as well. That is why we have suggested that we all talk to each other on a consensual basis to try to reach a solution.

I mentioned the question of loans, the Treasury and the parallel with the Maxwell situation. The then Conservative Government got their priorities right. In due course, they sorted out pensions reform through what became the Pensions Act 1995, but their priority in the short term was to get help to those who needed it because they were facing destitution.

With the exception of the Minister, we have all dealt with these issues of improvement and changes to the FAS before, over and over again, and the Government have been dragged kicking and screaming each time to make further concessions. On past form, Ministers will relent and agree with us sooner or later. Why not sooner?

Mr. Frank Field (Birkenhead) (Lab)
Mr. Deputy Speaker, may I ask you a rhetorical question? Are you, like me, visited by the odd nightmare? That nightmare is one in which one knows the right course of action, but is paralysed to take it. All of a sudden, one wakes up and finds oneself back in the real world. Listening to what was said from our Front Bench today, the comparison with being paralysed and unable to take the right action seemed to be there. The nightmare, however, is visited not on us, but on those of our constituents who have paid into an occupational pension for most, if not all, of their working lives, and have been robbed of that to some degree—sometimes to a great degree.

Let me remind the House of the background to this matter. In 2002, I introduced a Bill that had two parts. One was to establish an insurance scheme, and one was to deal with what we then thought were small numbers of people who could not be insured because their schemes had already gone bankrupt, or would do so before the insurance scheme came into existence. I proposed that taxpayers should not have to foot a penny of the bill of making good the pensions of those in the second group, and that we should draw upon the unclaimed assets of banks and building societies.

What was the Treasury’s response to that? It told us that, although these assets were unclaimed, it did not mean that they did not have owners. The Treasury was not minded to claim such assets, which sometimes were unclaimed for 100 years or more, to foot the pension bill of those who had so cruelly lost out. We now know that the Treasury says not only that the assets will be claimed by the Government, even though they are unclaimed and may have owners, but that pensioners will not have the first claim on them, as first mentioned in this House. Instead, the assets will be used for youth projects. It is not that anyone in the House is against financing youth projects, but we think—as Aneurin Bevan said—that politics is about priorities, and when it comes to priorities, pensioners should be at the top of the list.

The Minister for Pensions Reform is one of our most adroit performers at the Dispatch Box, but at the end of his contribution, I was left wondering what we were offering pensioners. All I knew was that we were not offering them the deal that we should be. Tonight, we should take the opportunity to put an end to the nightmare into which they have been plunged for many a long year. Those on the Treasury Bench know that we have by-elections coming up. Lots of Members on this side of the House, who agree with us in spirit, will not want to be with us in the Lobby because they know that some Opposition Members would exploit that in by-election campaigns.

I hope that Members of the House of Lords would not misread a vote as a lack of determination on this side of the House. When our deliberations return to them, I hope that they maintain their position, and keep sending the measure back to us until we reach the final tape. At that point, the Government will have to give way, if they have not already done so, and we will get justice, at long last, for those pensioners who have been so cruelly treated by the circumstances regarding their pensions funds. All of a sudden, the light of day will then be upon the Government, and they will realise that the funds can be found from somewhere. We might as well do that tonight rather than later on in the Session. We owe that to our constituents, and I hope that we shall vote accordingly tonight.

Danny Alexander
I was struck by the—probably uncharacteristic— partisan tone struck by the Minister in his opening remarks. There has been a lot of talk about building a pensions consensus during the debates on pensions that many of us have been involved in. During this debate, the House has to think about the cross-party interest of many hon. Members in ensuring that the 125,000 victims of the collapsed pensions, to which the right hon. Member for Birkenhead (Mr. Field) referred, have a fair and just settlement. We have an opportunity tonight to ensure that they do, and to ensure that the paralysis, quite rightly described by the right hon. Gentleman, stops and the nightmare for those 125,000 people is brought to an end. Let us ensure that those people are not presented with continuing injustice and a continuing struggle.

Let us not forget that what has brought the matter most vividly to the House’s attention for a period of years was vigorous campaigning. We saw it again today, as many of the victims of collapsed occupational pensions were present in Parliament square, to lobby Members of this House about the justness and fairness of their cause. Let us not say to those people, “You have to keep struggling on.” Let us back the amendments and make sure that those people have the fair and just settlement that they seek, and which they deserve. That settlement is embodied by the amendments, including amendment No. 24, which I shall come to shortly.

The background to the matter is well known. As the right hon. Gentleman said, many people have been affected during the period between the suggestion of such legislation and its coming into law. The Government’s role in the whole sorry scheme has been criticised by several independent bodies, such as the European Court of Justice, the High Court, the pensions ombudsman and the Select Committee on Public Accounts. If a footballer had been shown four red cards in succession, the police would be called to get him off the pitch. The Government need to respond with more alacrity to those findings than they have displayed so far.

Jenny Willott (Cardiff, Central) (LD)
Does my hon. Friend share my surprise that, although the Government finally appear to have accepted some guilt for maladministration after the attempts by the four different bodies that he mentioned, they are still not putting right the financial injustice?

Danny Alexander
I am grateful to my hon. Friend for her intervention and pay tribute to her work in campaigning for her many constituents who have been affected by the problems. I share her surprise that, although the Minister appeared to offer a further small concession, albeit with few numbers attached, he was not willing to go the whole hog. I share the view of the hon. Member for Eastbourne (Mr. Waterson) that the Government will eventually be forced to do that. They have not done so yet, and that is gravely disappointing.

Although I acknowledge that the Government have made progress in expanding the FAS from its original limited basis to a slightly less limited basis—and, potentially, an even less limited basis—they seem to have been dragged kicking and screaming to that point. Any resultant positive feeling among the victims of the scandal has been dissipated by the Government’s niggardly approach to making progress. There is genuine anger about that. I went to the demonstration in Parliament square today and saw many people wearing T-shirts, which claimed that the Chancellor of the Exchequer “stole my pension”. That shows the extent to which the issue arouses genuine and justifiable anger.

The anger derives from the big difference between the PPF and the FAS. The Minister used the phrase “core pension”. He has now invented a new phrase—“expected core pension”. Others have drawn attention to the fact that the term “core pension” is misleading and appears to have been defined uniquely for the purposes of the debate to make it sound as if more is being offered to the people who are affected. All hon. Members should bear that in mind when they cast their votes.

Sir John Butterfill (Bournemouth, West) (Con)
The hon. Gentleman will also realise that the suggestion that a loan somehow reflects what happened in the Maxwell case is factually inaccurate. There was initially a Government loan, but nearly all the assets were subsequently recovered or squeezed out of the banks that had lent against them, so there was not a huge debt to be repaid at the end of the day.

Danny Alexander
I am grateful to the hon. Gentleman for that intervention. The amendments’ point is to say, “Let’s get on with it. Let’s get the Government loan through the system to achieve the PPF level, not the more niggardly proposal.” We can then ascertain the resources that can be released through the Young review process and other processes, and calculate how much of that money the Government can get back.

The Minister is dithering about the financial outcome for the affected pensioners while saying, “We must wait and see.” There must be an end to the dithering. The House and the pensioners who suffered the injustice have waited a long time and consistently demanded PPF level benefits.

My party made it clear in our election manifesto that we believe that benefits should be paid at the PPF level. I previously referred to the figure that House of Lords written answers provided for the cost of that. At net present value, the cost would be £640 million in the first 10 years. That is £25 million a year and, as the Minister said, there is a curb. Perhaps I should not be, but I am prepared to take on trust the word of his colleague in the House of Lords for the correctness of those figures.

The difference between the PPF and the FAS is great. The 80 per cent. that is currently being offered amounts to only 60 per cent. when we consider expected pension, according to the pensions action group. That is because, unlike the PPF, the benefits paid out under the FAS have no index inflation linking. Other benefits, such as widows’ benefits, are more limited under the FAS than they are under the PPF. Other dependants’ benefits are non-existent. The FAS pays out at the age of 65, irrespective of the retirement age of the individual’s scheme.

Even if the Minister goes up to 90 per cent. of his “expected core pension”, it will amount to perhaps only 65 per cent. of actual expected pension—that is, two thirds of the sum to which people would have been entitled had their schemes not collapsed. Hon. Members should bear that in mind when they cast their votes this evening.

18:45:00

The core pension concept, which was invented for the purposes of the scheme, varies a great deal according to individual circumstances. I met one pensioner today who told me that his personal circumstances meant that his core pension amounted to 32 per cent. of his expected pension. There is a wide difference, which means that the Government’s talk of 80 or 90 per cent. is simply not in keeping with many affected pensioners’ individual circumstances.

The PPF method of delivering benefits gives a great deal more certainty and we should aim to achieve that.

Jenny Willott
Does my hon. Friend share my concern that my constituents who are affected are mainly people who worked in the former steelworks and were not on especially high incomes when they were employed? Their expected pension was not generous in the first place and getting two thirds of that can mean a small amount on which to live in retirement. That has implications for pensioner poverty.

Danny Alexander
I agree with my hon. Friend. Many of the 125,000 people whom we are discussing this evening are in the position that she describes. We are not considering pensioners who are expecting—as Cabinet Ministers might expect—large sums in retirement, but people who built up small amounts of pension. We should record our indebtedness to the pensions action group, and especially to Dr. Ros Altmann, for the way in which they assiduously brought such matters, including my hon. Friend’s point, to the House’s attention.

The Minister referred to the Young review. It is an interesting document, which rewards further detailed study—I am sure that all hon. Members have studied it. It includes much that should give aid and comfort to those who support the amendments. For example, it emphasises the importance of stopping the annuitisation of the assets that are left over in the collapsed pension schemes. That is precisely the outcome that amendment No. 22 would achieve. The Minister wants to wait until November, when I presume that we will have the next phase of the report. Who knows how much longer Government action will then take? It could be attached to another pensions Bill. The process could take some time. If, during that time, many of the assets are annuitised, the benefits that could accrue to the FAS will be lost. Even if the Minister rejects all the other amendments—I wish that he would not—amendment No. 22 is in his interests as much as those of everyone else who pursues the matter. 

I fail to understand the basis of the Government’s opposition to the proposals. Although the amount of money required to increase benefits to PPF level— £640 million at net present value—is significant, it is not a great deal of money in overall annual public expenditure terms. I cannot understand why Ministers are so unwilling to do the right thing by a group of pensioners who have been treated so unjustly.

Mr. Gordon Prentice
The hon. Gentleman will agree that the Young review tells us that, of the £1.7 billion in assets that have been identified, £1.3 billion has not yet been committed to annuities. That is why we must act this evening.

Danny Alexander
The hon. Gentleman is right. “Action this day” must govern us. It is not enough to delay a little more and simply take the Government’s word. The Select Committee gave cautious advice about the extent to which we should listen to the Government. We need to act now because, tomorrow, the amount that has been annuitised may be greater. The next day, it may be greater still. We need to act to ensure that that does not happen and that the maximum amount of resources is available to benefit those who have suffered so long because of the collapse of their occupational pension.

The Young review makes the point—perhaps it is a rebuttal to the Association of British Insurers, among others—that there are unclaimed assets potentially available in life insurance policies. However, the main point the review makes is that there is a need to create the lifeboat now. People need the guarantee of the benefits at PPF level. The Minister can have a review to ascertain the level of resources, but let us get the lifeboat going to give people outside the certainty that they require.

Amendment No. 24 is simple and makes it clear that PPF-level benefits should be delivered by regulation as a matter of right. The other amendments make it clear that the process of allocating resources should be gone through, but the uncertainty of the level of resources that might be delivered by the various programmes should not stop us voting for these amendments. There may be a small cost attached—the hon. Member for Wolverhampton, South-West (Rob Marris) has referred to it repeatedly, from a sedentary position and otherwise—but answers to parliamentary questions show that it is not great. Let us float that lifeboat now to give hope to all concerned.

The Minister presented his statement as an attempt to offer progress but it amounted to little more than more dithering and delay. Victims of this scandal cannot wait and, with the exception of those to whom the hon. Member for Eastbourne referred who have sadly passed away, they will not go away. They will knock at our door every day they can. That is another reason why the House should act today. The amendments establish the lifeboat and start the search for the resources to fund it. That is the right order in which to do it. Let us not spend weeks, months or years reviewing the assets that might be available before we decide to float the lifeboat and give the guarantee of the appropriate level of benefits. Let us vote for the amendments tonight.

The Prime Minister has made clear his wish to present an ethical dimension to his Government’s domestic policy. What better way to start than to ensure that the amendments are passed tonight and that the victims of collapsed occupational pensions in the FAS get the levels of benefits that they desire? The Prime Minister has also made it clear that he wishes to restore the role of Parliament. What better way could there be for the House to show that if the Government are not willing to provide that ethical dimension to their domestic policies, then it is? I hope that the House will support the amendments.

Dr. Tony Wright
My right hon. Friend the Member for Birkenhead (Mr. Field) mentioned the word “justice”, which is the right word. Fundamentally, we all have to decide whether we want to do justice to a group of people who, through no fault of their own, lost their occupational pension scheme. Either we do, or we do not. The Government certainly want to help them and today’s announcement is welcome. I am not sure whether it is the fourth or fifth extension of the original FAS scheme; I do not disparage that, and it is welcome. We have travelled a long way, but we have not yet arrived at a position of justice. For all the reasons that we have rehearsed endlessly, there is still a big gap between what we think these people should get, as under the PPS, and what they will get, even under a more generous FAS. That is and always has been the fundamental point.

My hon. Friend the Member for Birmingham, Northfield (Richard Burden) asked the Minister a very good question: was the 90 per cent. core pension entitlement now seen as a ceiling, or as the review continued and assets were discovered would there perhaps not be a ceiling? Might we go as far as we could to get some sort of parity with the PPF? I was not sure what the answer was; perhaps the Minister was not sure. I hope that he will become more sure as it would be helpful to have the answer.

We have made awfully heavy weather of this matter. Many of us simply wanted to vote at some point for a proposition that said that some public money would have to be spent in order to do justice. The Government began by saying that it was not a question of money. As we have finished, we see that it is entirely a question of money. The official Opposition said that they wanted to see justice done, but did not want to spend any public money up front. It would have been better to say, “There is cost involved in doing justice, but it is justified.” This involves the whole House because both main parties are part of the story as to how we have got here and there is a collective responsibility on the House to put this right.

Kelvin Hopkins (Luton, North) (Lab)
I support my hon. Friend. The amount of public money involved has been estimated at £20 million for the first year, although it might rise beyond that. The amount of money that we lose every year from tobacco smuggling alone is £2.5 billion, more than 100 times that amount. There is also VAT carousel fraud and mistakes in benefits. Hundreds of millions, if not billions, of pounds are lost or wasted every year—money that could easily pay these tiny amounts of money.

Dr. Wright
As ever, my hon. Friend and fellow Select Committee member makes telling points.

I would have preferred us to address this matter in a more direct up-front way. We did not, and we now have to do it through an indirect route of a loan and the expectation that assets will be recovered. If that is the way to get the commitment, let us have it by that route; it is better than no route at all.

The Select Committee has become preoccupied with the solvent employer schemes. We have had continuing dialogue with the Government on that and while it may seem arcane to some, people who have lost their pension in those schemes are in exactly the same position as those in all the other schemes. The Government have said that they are prepared to help members of schemes where trustees have agreed to a compromise agreement with employers because the alternative would have been to force the employer into insolvency, but they have not addressed the position, despite much prompting, of those whose schemes were closed before June 2003. That is an important date; it is when schemes could be closed without funding full buy-outs.

The Government, rightly, have repeatedly refined the rules governing the closure of pension schemes, and after 11 June 2003 employers were allowed to close their pension schemes only if they provided a full buy-out value for both those receiving pensions and scheme members who had not yet reached pensionable age. However, before that date employers were able to close company pension schemes provided that certain funding requirements were met. There was no question of trustees being able to prevent it.

19:00:00

We asked the Government directly whether it was correct that until 11 June 2003, it was legal for employers to close a pension scheme funded to the minimum funding requirement level even if the benefits promised could not be secured; and, if so, whether trustees or scheme members would have any legal means by which they might ensure full benefits were paid. The Government said:

“No legal recourse would be available in relation to the employer debt legislation for pre 11 June 2003 wind-ups, if solvent employers had met their legal obligation to pay the debt calculated in accordance with the legislation.”

We know now that the Government and the regulator are considering what more can be done to compel employers. However, it is okay for the Government to talk about the need to compel employers and to talk about their moral obligation, when they clearly do have a moral obligation. There has been deplorable behaviour, but the point is that what was done was legal. For the members of the schemes, the effect is just the same—they have lost their pensions. That is the point from which we should start.

Amendment (a), which reflects the continuing discussion that we have been having with the Government about the importance of the sequence of events and the dates, is intended to secure support for those who suffered because of the inadequate legal framework before June 2003. My amendment answers completely the Government’s worry that somehow the floodgates will be opened and they will not be able to exercise moral suasion on employers. There is none of that, because it simply establishes the legal position. After that date, the Government are right that there is a case for supporting only schemes where the trustees correctly decided that compromise was in the best interests of members. Before that date, compromise, as I understand it, was not a relevant consideration.

The question to be decided now is whether we simply trust to the process that is under way—I understand that the Government want that and have moved in that direction. They have said that we can always take care of such issues through secondary legislation. However, it is only now that we can ensure, through primary legislation, that the solvent employer schemes are brought within the FAS. I accept the Government’s worries about opening the floodgates; but in that case they should bite the hand off with amendment (a), which would give them a circumscribed statement of the kind of schemes that should be properly brought inside the FAS. It is on that basis that I shall be asking the House to support it.

Miss Julie Kirkbride (Bromsgrove) (Con)
I am particularly honoured to follow the hon. Member for Cannock Chase (Dr. Wright), who is Chairman of the Public Administration Committee. His argument about the moral imperative to do something for pensioners who have lost their pensions through no fault of their own is, along with his other arguments, absolutely right. I do not intend to take up too much of the House’s time, because as hon. Members will know there is other business in this group of amendments that is also important, particularly to women. It would therefore be helpful to conclude these arguments quickly.

However, I have a particularly good example from my constituency of the injustice of the current arrangements. I represent two groups of people who have lost their pensions: those scheme members who worked for United Engineering Forgings, the old steel company that collapsed before the Pension Protection Fund came into being, and who therefore have to rely on inadequate compensation from the financial assistance scheme; and the people who used to work for the old Rover car company. Although they lost their jobs in the collapse of that company, mercifully that happened days after the Pension Protection Fund came into being, so they were not in the appalling situation of losing both their jobs and the pension contributions that they had made over the years working for that company.

There are other companies that I might mention, such as Kalamazoo. It would be helpful to put on the record my appreciation for the efforts of Mr. Peter Wheeler from Kalamazoo, who has been one of the major campaigners in getting the Opposition and Government Members focused on the issue, as well as the Government. There is also Turner and Newall, which is another company in our region whose employees have included constituents of mine who have lost their pension provision.

The situation is simple. Those people did absolutely the right thing. They did what society asked of them, what their families asked of them and what the Government could ask of them. Those people sought to look after themselves by forgoing income that they could have spent today, in order to look after themselves and their families in the future. In that sense, the House surely owes it to them to put together a scheme that compensates them for doing what we could ask of them, but which many others do not do. We have a moral imperative to try to protect those people in their predicament, now that they have lost their pension savings.

That is particularly urgent, given that many of the people who have lost their pensions and who have looked to the financial assistance scheme have either died while waiting for the money to be forthcoming or become much more ill or retired, while remaining in a penurious position. It is simply not fair that that group of 125,000 people, whose numbers will not grow, because of the existence of the Pension Protection Fund, should find themselves in the particularly injurious position of not being properly compensated for the loss of pension savings that they made in the past.

The words of the right hon. Member for Birkenhead (Mr. Field) were particularly accurate. The Government could have done something about the problem years ago and saved people from that predicament because they had the assets of banks and building societies, which they could have plundered to protect those people and offer them compensation. However, the Government made a distinct decision to spend that money on something else. Although provision for young people in our communities is welcome, I agree with the right hon. Gentleman that the priority should have been those people who had done the right things by themselves and society. They deserved to be compensated.

It is not good enough for the Government to um and ah, and to keep giving the House a little bit more, in an attempt to buy off any opposition to their plans. They could have dealt with the situation some years ago, but they chose not to do so. However, the House will not let the issue go. I applaud the willingness of Labour Members to put the issue on the table and say that the Government must come forward with proper compensation that matches the protection offered by the Pension Protection Fund, because that is the right thing to do.

I agree with Opposition Members in general that the urgency of the current situation is paramount. We must prevent the £1.3 billion that has been itemised in the Government-commissioned report from being made into annuities, by passing a law in the House today. We must also force the Government’s hand into looking again at offering full compensation, whether through the lifeboat fund or through an alternative scheme that the Government have in mind. Frankly, it does not matter to my constituents; what matters to them is seeing justice done. The justice that is acceptable is to have parity with the Pension Protection Fund. I urge the Minister to listen to the pleas of the House and do just that.

Alan Simpson
I would like to address some of the misleading arguments that have been used to try to create a case for rejecting the Lords amendments.

I begin with the point that my right hon. Friend the Member for Birkenhead (Mr. Field) made. It is just not true that the Young review has sunk the lifeboat argument. His own experience, in floating the argument in the first place, was to be met by direct Treasury opposition, which sought to block a claim that unclaimed assets could be used to meet a public good. The situation now is that the Treasury has changed its position. It has decided not only that those funds can be used, but that it will decide—or has decided—what the public good should be in this case. Saying that someone has pinched the lifeboat is quite different from saying that someone has sunk it. If the lifeboat has been pinched, it is perfectly legitimate for the House to pinch it back and put it on a proper course again.

It would be terrible to suggest that the Young review was the basis on which the claims of the old were to be rejected. I suspect that, if we were to widen the remit of the Young review, that is not a claim that he would make either. The terms set for him specifically involved looking at pension scheme assets, not at those of banks and building societies. It is therefore implausible to say that, on the basis of an area that he has been precluded from considering, he has concluded that there is no case for supporting a lifeboat fund.

Let us think about that for a moment. The reality is probably that a significant proportion of funds accrued as banks’ and building societies’ unclaimed assets have come from people who have died without an estate to pass their savings on to. The majority of those people will be older, rather than younger. Let us try to project ourselves into the minds of such people and ask whether, on their death-bed, they would be more likely to have said, “Give it away to the kids” than “Give it away to my mates. Make sure that people of my generation don’t live in poverty as a result of my dying with an estate that isn’t able to make use of my savings.” It is morally implausible to claim that it is unacceptable for the House to decide that pensioners have a prior claim to those orphan assets.

Lynne Jones (Birmingham, Selly Oak) (Lab)
I am not sure that it is reasonable to speculate on people’s dying wishes. Many elderly people are just as concerned about the needs of the young people in our society. The fact is, however, that the sums involved are relatively small, and if the Government wanted to deal with this matter, they could do so. The Prime Minister, when he was Chancellor, would often pull a rabbit out of the hat and spend lots of extra money, to cheers on the Labour Benches. Surely we ought to cheer if he were to find the £25 million or so a year to deal with this problem.

Alan Simpson
That is absolutely right. The sums involved are relatively small in the context of any of the major functions of the Government Departments. It cannot be beyond the wit or the financial reach of the House to say that we could provide those resources up front to ensure that the lifeboat floats, and that it sails in the right direction.

I want to make a brief point about the insurance companies. We have all received letters from the Pru, lobbying us and saying that such action would be robbing Peter to pay Paul. The hon. Member for Bromsgrove (Miss Kirkbride) mentioned a company scheme that had collapsed. The company was UEF. She could have gone on to say that UEF was owned by the Pru. The Pru has not paid out a penny to help the pensioners who lost their pensions in a scheme that it owned.

The insurance industry is terrified that the House could take a decision to hold a wide-ranging investigation into the scale of the assets that it is sitting on, and that we would find a legitimate case for saying that it should have been paying out from those assets. It is terrified that, were we to hold such an investigation, we would discover that it is sitting on shed loads of money that ought, quite properly, to be part of the subject of this House’s decision making. This is a fundamental decision about democracy. It is a question whether the House has the right and the courage to hold such an investigation, come back with conclusions and to make decisions on an informed basis. To rule out our right to hold such a wide-ranging investigation is an insult to ourselves as much as to the pensioners who are pleading for us to take action on their behalf.

19:15:00

Although I sort of welcome moves in the direction of the payments of 80 per cent. and 90 per cent. of core pensions, the reality is that the 90 per cent. will not turn out to be 90 per cent. any more than the 80 per cent. turned out to be 80 per cent. The idea of core pensions involves taking the member’s expected pension, deducting all the inflation linking, some of the revaluation, the tax-free lump sum, some widow’s benefits and the ill health benefits, and then calculating 80 per cent. of the resulting figure. A further 22 per cent. is then deducted as tax at source to get to the final figure. And this is calculated only from the age of 65, not from the scheme pension age.

That is why Members are correct in saying that many of the scheme-affected members who are included in the FAS will struggle to get 50 per cent. of their expected pension. Those pensioners assail us in Parliament square and on the streets of our constituencies with the absurdity of the claim that they will somehow get 90 per cent. of their core pension; they will get only a sliver of their real entitlement.

Mr. Frank Field
Can my hon. Friend imagine what the reaction in the House would be if our pension scheme went belly up and our expectations of a modest retirement were ripped away from us? Would the House be this empty, or would all the Benches be overflowing with anger?

Alan Simpson
I am a huge admirer of my right hon. Friend, but he sometimes steals my final lines. This is kind of difficult, because that was going to be my concluding point. Were Members of this House to be told that, despite our contributions to our final salary scheme pensions, we were not going to receive the full entitlement that existed on paper, and that we ourselves were to be “FAS-ed”, our response would be unprintable. We would struggle to find a place to sit in the Chamber for such a debate, the Division Lobby would be crowded and we would vote to ensure that what had been promised to us, and what we had paid into, would be delivered. This is the issue that we have to address for ourselves. If that kind of approach is good enough for us, it has to be good enough for the pensioners outside Parliament who have been lobbying us for goodness knows how many years. Throughout their entire working lives, they have been honest contributors to what they believed were honest schemes.

Sir Patrick Cormack (South Staffordshire) (Con)
Will the hon. Gentleman give way?

Alan Simpson
I will not give way; this is almost my final sentence.

We owe a debt of gratitude to the Lords for the amendments that they have passed, which get us all off the hook. Financially, it is a small hook, but morally and democratically, it is a huge hook. The best way in which we can thank the Lords is to vote to support their amendments when we have the chance to do so this evening.

Mike Penning (Hemel Hempstead) (Con)
First, may I put on record what a pleasure it is to follow the hon. Member for Nottingham, South (Alan Simpson)? Listening to someone speaking from the heart as he did on behalf of his constituents for the five or six minutes that I heard him was a pleasure. We could all learn a lesson from the speech that he has just made.

The last time that I stood here and spoke on this subject, my constituent Peter Humphreys was in intensive care in Hemel Hempstead hospital. His wife was by his bedside, and I stood here waiting for a text message to find out how he was. Today, in Parliament square, Peter demonstrated with the rest of the pensioner action group, and I am sure that he will be watching me from somewhere at this moment. He is well, and he is getting better. All that he and his family care about is the campaign for justice for the pensioners who have had their life savings, their future and their children’s future stolen from them.

My hon. Friend the Member for Eastbourne (Mr. Waterson) referred to a lady called Marlene Cheshire, and I am sure that she too is watching me from somewhere. Her husband, David, did not make it. He died while he was waiting for money to come through from the scheme. As I have said in the House before, Marlene told David on his death-bed that she would get the money, and she has now just about got some money through.

We have heard about the scale of the problem this evening. We are talking about 125,000 people, along with their loved ones and families, who have been affected by this terrible occurrence. These are not rich people and they are not asking the state for more because they have not contributed. These are ordinary working people, who did the honourable and right thing that they were told to do—they paid into a safe scheme, and they were told by the Government of the day that the scheme was safe. The Government of the day was my Conservative Government and promises were made subsequently by later Governments.

It is sad to see how Government Members have got into a party political spat. Frankly, that was not necessary. We all know what is right and wrong and accusing hon. Members of jumping on to bandwagons or trying to gain political profit from this affair is, quite frankly, sick. As I say, we all know what is right and wrong here. I was approached by my Dexion group long before I became MP for my area. I read its file—a deep and long one—and its members tested me out, as I have said before, as to whether I had or had not read it. Their case, like many others, was cut and dry. They had gone into a scheme in good faith and paid into it.

On four occasions, the Government have been found guilty in respect of those pensioners. There is no argument about that. That is what the parliamentary ombudsman is for. Frankly, if the parliamentary ombudsman is not willing to stand up to Government—any Government—we should not have one. What is the point of having a parliamentary ombudsman if we cannot take cases to him as MPs when we believe that something has gone wrong? If any Government of any description can turn around and say, “We do not like that; we are going to be judge and jury on the matter”, what would be the point of having a parliamentary ombudsman at all?

Here we are today, after the Government have been dragged through the courts, kicking and screaming about different schemes at different times. I suspect that it is all about trying to get a few more of their Back Benchers not to vote with the Opposition on the amendments. I hope and pray that many of their Back Benchers are tucked away somewhere where the Whips cannot get at them. I really hope so, because this great House must show that it cares about people’s lives and futures. It must know the moral position—what is right and wrong. If we do not follow the moral course, the House will be denigrated this evening. We must do what is right for our constituents.

As we have already heard, we are talking about only a tiny amount of money in the big scheme of things. I have people telling me at my surgeries every week that they have been paid thousands of pounds too much through child tax credit or working tax credit—or Uncle Tom Cobleigh’s credit, frankly. There is money flying about all over the show, particularly within this particular Department, which has a huge financial base. Money is being lost and costs cannot be agreed, but we are talking about people’s lives and only a small amount of money.

I say to hon. Members that tomorrow morning they will have to look in the mirror and stare at someone who voted in a certain way tonight. Can we in all conscience not support these people so that they get the help that they need today? Let us argue about where the money comes from and broaden Young’s remit to look into other sources such as banking assets. It is ludicrous to have such a narrow remit that focuses only on the insurance side of the problem. Let us put that to one side and give these people the help that they need today. If the amount of money that Young talks about is available, we may not need to use the guarantee of a loan from the Government—just as Maxwell pensioners did not have to. The money was there, should it have been needed. Let us stand up for people tonight in a moral and ethical way. I hope that all Members will believe that that is the right way to proceed and will support the Lords amendments. I congratulate their lordships on what they are doing.

Julie Morgan (Cardiff, North) (Lab)
I had hoped that the Government would bring this sad series of events to an end this evening by making a real commitment to the pensioners. I am disappointed that, so far, that has not happened. I accept that progress has been made and I welcome what my right hon. Friend said today. We are creeping nearer to the 90 per cent. figure, but as many hon. Members have said this evening, what does it actually mean? We have heard about other benefits related to the Pension Protection Fund. I cannot understand why the Government will not go that extra step and make a proper commitment. 

It was five years ago that Allied Steel and Wire went into receivership in Cardiff, so this saga has been going on for five long years, during which time I and other hon. Members have had people coming back and forth to our constituency surgeries, saying time and again that they expected a Labour Government to sort the problem out. I feel that the Government have made some efforts and achieved some progress, but they have not gone as far as they should.

Many people have campaigned long and hard on this issue and I know that many will be disappointed that the Government will not finally settle it today. We must pay tribute to the pensioners themselves and to the unions, particularly to Community and Amicus, which took the case to the European Court of Justice in the interest of its members in January 2006. The ruling said that the pension rules were inadequate in protecting the expected pensions of members of occupational pension schemes in the event of their employers becoming insolvent. If those rules had been implemented adequately, none of this would have happened. I still hope that we can settle the issue, but time is certainly running out. It is time that we did the right thing by all those affected—and some of the Lords amendments would achieve that, though I did not wish to reach the position where I felt I would have to support some of their amendments against the Government.

What guides me at this particular moment is the experience of my constituents in Cardiff, North, particularly ex-employees of Allied Steel and Wire. What they have told me has driven me to campaign for justice for those workers. I have seen for myself just what hardship the loss of their pensions has caused. We have all heard first hand just how hard it was for people to learn that they were going to lose first their jobs and then their pensions, despite having paid into an occupational pension scheme—often for decades and on the advice of the Government.

Many of those people worked in the hard environment of the steel industry for all their lives and many have told me about the devastating impact of these events. One man put it very bluntly when he said, “I face a bleak retirement”, yet he had paid into a pension scheme for more than 20 years. Some people have never been able to talk about what happened to them. I have mentioned before that one man’s wife told me that since this happened, he had been unable to say a word about it because the trauma was so great. Some members have died not knowing how much loved ones will have to live on. I do not feel that that can be allowed to go on and on. The excruciatingly long time that it is taking to get justice for all those affected by the collapse of pension schemes has caused untold stress and strain and affected the physical, emotional and mental health of many pensioners and their families.

I welcome what the Minister has proposed tonight, but it still continues the uncertainty. We still do not know what extra percentage will result from the proposals in the Young review. We still do not know how much the final figure will be when the Government match that percentage. My constituents tell me that the stress and uncertainty have gone on far too long and they urge us to bring this sad, appalling and morally wrong situation to a satisfactory conclusion.

The Young report offers some hope, but I fear that we still do not know what it will mean for those pensioners. If the Government offer no certainty today, I feel that I must consider voting in favour of any amendments that will result in payments at PPF levels for my constituents who are currently in receipt of FAS. I support the intention behind amendment No. 24, which is a simple amendment that aims to bring pensions up to PPF levels. I hope that we will have a separate vote on that amendment.

I am reflecting on the other amendments and support my hon. Friend the Member for Cannock Chase (Dr. Wright), the esteemed Chair of the Public Administration Committee, when he said that it would have been preferable not to have gone down the route of loans and lifeboats. It would have been better to have had a straight commitment from the Government and then to have found as much as possible from the sources identified in the Young report. That might have reduced enormously how much public money had to be used. However, as my hon. Friend said, sometimes it is necessary to make a commitment to public money, and I believe that this is one of those occasions.

19:30:00

I very much regret that we, as a Government, have reached this stage today. This is a marvellous Bill, which promises pensioners a much better future and recognises the issue of women’s involvement in pensions in a way in which it has not been recognised before. I would support it wholeheartedly were it not for the problems that we are discussing, and I am very disappointed that the Government have not reached a firmer conclusion. Unless the Minister says anything more definite, however, I shall vote for certainty and a better deal for my constituents.

Anne Main (St. Albans) (Con)
It is a delight to follow the hon. Member for Cardiff, North (Julie Morgan), who echoed what had been said by the right hon. Member for Birkenhead (Mr. Field). We are no clearer about what the Government are proposing; it seems to be a bit more smoke and mirrors and a bit more jam tomorrow.

There was some laughter earlier, but I do not think any of us can really imagine what it is like to lose a pension after 30 years of saving. Many of those involved in this scheme were ordinary hard-working people, who did not expect riches in later life but certainly expected to avoid the poverty trap into which many on state pensions had fallen. They are not feckless spendthrifts waiting to be bailed out. As the right hon. Member for Birkenhead said, many went without during their working lives for the sake of the contingency fund that they thought they were setting up, not just for themselves but for their wives and families.

It was Government advice that those people were following. It is not as if they suddenly decided that some snake oil salesman had come up with a good idea; they were persuaded by the argument that this was the right thing to do. At £87.30, the state pension is hardly a king’s ransom. It is no wonder that many of our hard-working constituents hoped to avoid the possibility of not being able to lead the life that they were expecting, with happiness and a degree of comfort in their old age.

My postbag, like that of others who are present, reflects the views of those who feel that they have been sadly deceived and face an impoverished old age. We must step in tonight, rather than delaying for the sake of the promise of some future benefit that is undefined. When my right hon. Friend the Member for Wokingham (Mr. Redwood) pressed the Minister for figures, he made some party political points that I think did a disservice to the House and to our current argument, but we were given no firm figures. We may not have a perfect system to propose, but at least we are offering a degree of security that was not forthcoming from the Government.

I believe that, as Members of Parliament, we are considered to be honourable, and that is a badge that we all like to wear. But my constituents who have been caught up in the Dexion pension crash may be watching the debate today, perhaps from somewhere closer than some of us may care to think, and they will draw their own conclusions if we do not seize the chance to right what Members on both sides of the House acknowledge to be a terrible wrong. This is not cheap party political posturing because some by-election is taking place somewhere; we are dealing with a long-standing complaint, recognised by Committees that were heavily Labour-dominated. I firmly reject the idea that what is being said tonight is intended merely to win a by-election.

As we have heard, the collapse of the Dexion pension scheme is not an isolated case, but it is a salutary tale which, like others, has prompted calls for action by Government. In 2006, a Select Committee said that the Government were focusing their energy on the findings of maladministration rather than considering the remedies. We have a remedy tonight.

The fact that the Government were not considering the remedies was seen to add to the distress of the people caught up in this mess—for it is a mess. A constituent of mine, Mr. Mike Chapman, is a former Dexion employee, and he and his family believe that the Government are dragging their heels. Although we have heard of similar cases tonight, Mike’s case typifies the enormity of the personal crisis that faces people. In May 2003, 180 Dexion staff were caught up in that crisis.

There should not have been a problem. Those people thought that they were in a secure pension scheme. In fact, their contract insisted that they join a pension scheme. Mike was in the scheme, and having paid the additional voluntary contributions for more than 20 years, he rightly expected a relatively comfortable old age for himself and his family. But, as we have heard, the Dexion pension fund, like others, did not have enough money in the pot to meet the obligations. What is more, work forces and their pension funds are near the bottom of the pecking order when a failed company’s creditors are ranked. A valuation of the Dexion pension fund showed a £20 million shortfall, which was disastrous for the employees.

At 64, my constituent Mike Chapman was within a fortnight of retirement. Can Members imagine that being snatched away from them within a fortnight of retirement? When Dexion—a firm that manufactured shelving—went into administration, it left a gaping hole in its pension scheme. Mike Chapman tells me that rather than gaining a pension of more than £1,200 a month, he and others like him will receive nothing. He is too young to qualify for the financial assistance scheme.

In the four years since Dexion’s collapse, Mike and his wife Valerie have lived on their savings. They had saved, fortunately: like many others involved in pension schemes, they are a prudent couple. They have had to try to make ends meet by working in odd jobs. They have even worked as medical research guinea pigs to generate some income. Earlier today we talked of equality for women, but I can tell Members that for an older person, seeking employment to supplement one’s income is not an easy option. It is not open to many people to seek gainful employment.

Being a sensible man, Mike had followed the Government’s advice to the letter, and he has paid the price for doing so. As we have heard today, people were positively encouraged to act as he did. Mike paid in thousands of pounds of his own money because the Government and his employers told him to do so. He was promised that he would be safe and would receive a generous settlement, but that did not happen.

Shockingly, Mike and others discovered the hard way that final salary schemes were not worth the paper they were written on; they were only as good as the employers running them. I want to quote Mike’s words, and those of others caught up in the scheme. I think that Labour Members who do not share our passionate feelings—[Interruption.] I refer to some Labour Members. Many have expressed the same wishes as us today, but unfortunately those on the Front Bench have not done the same. [Interruption.] I am sure that Labour Members want to hear Mike’s words rather than shouting them down. He said:

“We had saved to pay for the good things in retirement, expecting the pension to take care of the day to day expenses. But life after 60 has been very different to how we imagined it.

After four years of fighting, I won't believe anything until I see the money in my pocket. We're planning on the basis of assuming the worst because we cannot afford to be disappointed.”

The wife of a Dexion victim said:

“I would love to be able to ask Mr. Blair”

—this was before the arrival of our new Prime Minister—

“and those in Government what on earth they think we should do now”

—not next year, but now—

“but of course it is not possible to talk with such lofty folk, I can not even get him to read the letters I send.”

Tonight the Government have a chance to listen to that lady, and to other people such as Mike. Mike is a former marketing manager. He lives in St Albans. He does not expect a quick U-turn, but Members can support him tonight.

Following articles in the media about the plight of Mike and other Dexion workers, they posted their comments on a website. Many drew attention to the moral dimension of the Government’s apparent contempt for the public—that is how the Government are regarded: with contempt. They feel that they have been let down, and they speak eloquently of their experiences. I shall end by quoting comments that reflect the views of the many despairing victims from whom I am sure we have all heard at our constituency surgeries. This is what they tell us:

“Frankly the young might be better off spending their money having a good time while they are young rather than save for a Pension which might be taken away from them. At least they could have some happy memories while sitting huddled over a candle keeping warm”.

“The government do not care about those of us that stand to lose all or part of our pensions because of government mismanagement and misinformation. And this from a so-called Labour Government. But never mind, the MPs can all rest easy that their pensions are safe.”

“Many here”

—on the website, that is—

“have pointed out the moral dimension of the Government's contempt for the public, and failure to help people who are genuinely in need. The attitude of Blair and Brown, however, is rooted in mismanagement and incompetence.”

Those are not my words, but the words of people who have nothing as a result of the Government’s actions. They accuse all of us collectively—all hon. Members—of letting them down. Tonight we have a chance to show them that their comments may be misplaced, and that we can redress what has been done. 

Some Members have seemed to wish to shout all that down, and not to wish to speak to the likes of Mike Chapman. I am the voice of those people tonight. I hope that other Members will join us in the Lobbies, and ensure that we provide at least a degree of financial security for an old age to which people thought they were entitled and to which I believe they have a right.

Mr. Mike O'Brien
The debate has been long and passionate, and I shall reply briefly to it. There is clearly great sympathy in the House for the pensioners affected by companies having closed their pension schemes. No one wants to lose their pension, regardless of whether it is a private or a public sector pension. Concern has been expressed today by Members in all parts of the Chamber about those pensioners, and concern has been expressed in the other place that more money should be spent. There is disagreement about where that money will come from, but the Young interim report is positive about our being able to find more money for the pensioners. Today I have been pleased to announce that it is our intention to match any additional funds the review might bring forward with the goal of moving to the 90 per cent. mark. We also hope that the Young review will help to enable us to respond properly to the issue of solvent employers.

It is in pensioners’ interests that we get them more money as quickly as possible, so let us rapidly secure the Bill’s Royal Assent so that we can deliver immediate payments. We will not do justice to the pensioners by agreeing to the complex, costly and contradictory provisions before us. They will not deliver for the pensioners, which is the key objective. That is why I call on Members to support the motion to disagree.

Lords amendment disagreed to.

Lords amendment No. 16 disagreed to.

After Clause 18

Lords amendment: No. 16.

Amendment (a) proposed in lieu thereof:

Financial Assistance Scheme: eligibility where employers remain solvent

To move the following Clause:—

The Pensions Act 2004 (c. 35) is amended as follows.

In section 286 (financial assistance for members etc.) insert after subsection (2)—

“(2A) Conditions prescribed under paragraph (c) in the definition of “qualifying pension scheme” in subsection (2) shall not exclude schemes which have been wound up in the absence of an insolvency event as referred to in Part 2, provided that such wind-up began before 11th June 2003.”.’.—[Dr. Tony Wright.]

Question put, That the amendment be made:—

The House proceeded to a Division.

Mr. Deputy Speaker (Sir Michael Lord)
I ask the Serjeant at Arms to investigate the delay in the No Lobby.

Division 187
17/07/2007 19:42:00
The House having divided:
Ayes: 250
Noes: 305
Question accordingly negatived.

Lords amendment: No. 17.

Motion made, and Question put, That this House disagrees with the Lords in the said amendment.—[Liz Blackman.]

Division 188
17/07/2007 20:01:00
The House divided:
Ayes: 303
Noes: 253
Question accordingly agreed to.

Lords amendment disagreed to.

Lords amendments 18 to 24 disagreed to.

Clause 1

State pension

Lords amendment: No. 1.

Motion made, and Question proposed, That this House disagrees with the Lords in the said amendment.—[Mr. Mike O’Brien.]

Steve Webb (Northavon) (LD)
On a point of order, Mr. Deputy Speaker. Could you clarify whether the intention was to debate amendment No. 1, which I believed the Minister was seeking to do?

Mr. Deputy Speaker
The Minister has just moved the amendment formally and does not intend to speak at this time.

The Question is, That this House disagrees with the Lords in their amendment No. 1. As many as are of that opinion say Aye—[Interruption.] If Members want to contribute, they must stand to indicate their wish to do so.

Mr. Waterson
Further to the point of order, Mr. Deputy Speaker. My understanding was that the Minister would say something about the Government’s motion on amendment No. I, but if he does not intend to, I am happy to do so.

Mr. Deputy Speaker
I am sorry, but we have moved on. The Minister moved the motion formally, indicating that he did not want to contribute—

Mr. Mike O'Brien
rose—

Mr. Deputy Speaker
Order. If the hon. Member for Eastbourne (Mr. Waterson) now wishes to contribute to the debate, he may do so.

Mr. Waterson
Thank you, Mr. Deputy Speaker. I shall be brief because I know that other Members want to participate.

Many issues relate to amendment No. 1, which is the method proposed by Baroness Hollis in the other place, to allow—[Interruption.]

Mr. Deputy Speaker
Order. Will Members who are not intending either to listen to the debate or take part in it please leave the Chamber quietly?

Mr. Waterson
The amendment was proposed by Baroness Hollis in the other place and carried by quite a handsome majority with support from, I think, Members of all the different parties, including some of my Conservative colleagues. It is designed to help women with broken contribution records to be able to buy back previous years retrospectively—so there is an element of a contribution being made by the women—and to increase the limit to nine years, whether consecutive or not. As I understand it, the rules currently refer to six years and they have to be six consecutive years. There may well be women who get to the end of their working lives and find that they have any number of years still unpaid for. The amendment has the backing of Age Concern, Help the Aged and, above all, the Equal Opportunities Commission.

I have two issues to raise. I do not know whether the Minister will have a chance to reply. The Minister in the Lords said that the cost would be £260 million. Is that netted off against the means-tested benefits, such as pension credit, which the women might otherwise claim if they did not have this advantage? Would this really be an extra spending commitment if the Government, or any Opposition party, were to sign up to it? As I understand it, the proposal is not to change the rules on eligibility, but merely to increase take-up. All Governments, at different times, try to increase take-up by applying different methods to benefits and so on, but does that actually involve a commitment to greater Government spending?

Mr. Mike O'Brien
My right hon. Friend Baroness Hollis proposed the amendment in the other place. We understand, and are very sympathetic to, the objectives of the amendment, and hope that we can deliver its aim of helping women in this country if at all possible. The Government have always been clear about their desire to provide fairer outcomes for women and the measures in the Bill demonstrate that commitment. We recognise the strength of feeling expressed in the other place and we are keen to find a solution that may bring more people into the contributory system for the first time. However, this is a complicated issue, and it is important to explore the complexities and possible implications of the range of options, including the proposal in my right hon. Friend’s amendment.

There are for example options in relation to the number of years that could be purchased, the rate at which additional contributions could be paid, the treatment of individuals overseas, and the interaction with the current system. These have varying administrative, legal, cost, distributional and policy implications, and we need to ensure that we get any targeted solution right. We want to find a way to overcome these problems. We are keen that any solution should deliver a fair outcome for individuals who have experienced complex and fragmented lives, but at the same time we need to be mindful of how any changes would impact on people living overseas.

With that in mind, the Government will commit themselves to looking at the range of options in the coming weeks, including the option to buy additional years as proposed in the amendment, and to provide an update in the pre-Budget report. In doing so, the Government will consider all the options in terms of the following principles: fairness—any solution must help those most in need; affordability—any solution must be affordable and sustainable; simplicity—any solution must be deliverable, simple to implement and understandable to those it would benefit. There is no difference between my right hon. Friend’s wish to help women in this country and our wish, but we need to deal with the practical problems. I cannot make a commitment that we will achieve that outcome today, but we will use our best endeavours to deliver the principles of her amendment. She has authorised me to tell the House that, on the basis of that statement, she is now content and believes that this is a useful basis on which to go forward. I therefore ask the House to reject the amendment from the other place.

Danny Alexander
I will speak very briefly, in the remaining minute of time. The Liberal Democrats believe that this very important amendment will tackle the great injustice faced by many women pensioners. In particular, it will provide more flexibility to those people, especially women, who currently lack the appropriate level of contributions to get a full pension, even under the new system. It will help those whose employment records are broken, for example. It will also help with the cliff edge that people will face when the new system is introduced from 2010. As my hon. Friend the Member for Northavon (Steve Webb) pointed out, currently that cliff edge could confront people whose pension date is just before the new system is brought in and could cost them about £28,500. That is why it is important that the House support the Lords amendment.

Question put, That this House disagrees with the Lords in the said amendment:—

Division 189
17/07/2007 20:25:00
The House divided:
Ayes: 312
Noes: 68
Question accordingly agreed to.

Lords amendment disagreed to.

It being more than three hours after the commencement of proceedings, Mr. Deputy Speaker proceeded to put forthwith the Questions necessary for the disposal of the business to be concluded at that hour, pursuant to Order [this day].

Lords amendments Nos. 12 to 14 disagreed to.

Lords amendment No. 28 disagreed to.

Lords amendment No. 73 disagreed to.

Lords amendments Nos. 2, 3 to 11, 25 to 75, and 29 to 72 agreed to.

Committee appointed to draw up Reasons to be assigned to the Lords for disagreeing to certain of their amendments to the Bill: Danny Alexander, Mr. Wayne David, Natascha Engel, Mr. James Plaskitt and Mr. Nigel Waterson; Mr. James Plaskitt to be the Chairman of the Committee; Three to be the quorum of the Committee. —[Mr. Alan Campbell.]

To withdraw immediately.

Reasons for disagreeing to certain Lords amendments reported, and agreed to; to be communicated to the Lords.

Miss Ann Widdecombe (Maidstone and The Weald) (Con)
On a point of order, Mr. Deputy Speaker. In view of the imminent deportation scheduled for 9.30 tomorrow evening of Samar Rashavi, a Christian lady against whom a death warrant has been issued by the Iranian Government, have you received a request from any Minister to come to the House to make a statement about any change of policy from the usual line, which is that we do not deport when somebody is in serious danger of the death penalty, particularly for a reason that we would not recognise in this country?

Mr. Deputy Speaker (Sir Alan Haselhurst)
I am grateful to the right hon. Lady for giving me notice that she would raise a point of order. I have no knowledge of any intention of any statement being made to the House, but the right hon. Lady has used the device of a point of order to raise the matter, and I am sure that what she said will have been heard by those on the Treasury Bench. I cannot add substantively to that.

Parliament (Joint Departments) Bill [Lords] (Programme) (No. 2)

Motion made, and Question put forthwith, pursuant to Standing Order No. 83A(9)(Programme motions),

That the Order of 19th June 2007 (Parliament (Joint Departments) Bill [Lords] (Programme) be varied as follows:

1. Paragraph 2 shall be omitted.

2. Proceedings in Committee of the whole House, any proceedings on consideration and proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion two hours after the commencement of proceedings on the Motion for this Order.—[Helen Goodman.]

Question agreed to.

Parliament (Joint Departments) Bill [Lords]

Considered in Committee.

[Sir Alan Haselhurst in the Chair]

Clause 1

joint departments of the houses of parliament

Question proposed, That the clause stand part of the Bill.

20:42:00

The Deputy Leader of the House of Commons (Helen Goodman)
As my predecessor, my hon. Friend the Member for Sherwood (Paddy Tipping), said when he introduced the Second Reading debate on the Bill, the Parliament (Joint Departments) Bill is unusual in that it is neither a Government nor a Back-Bench Bill, but a parliamentary Bill, concerned with the machinery of Parliament. The Bill has its origins in the decision of the House of Commons Commission and the House of Lords House Committee to set up a joint Department to manage information and communications technology on behalf of both Houses.

We have a tradition in the House of making decisions about the services that we all need in a non-partisan spirit. I am pleased to say that the Bill enjoyed all-party support in the House of Lords, and that was apparent again when the Second Reading debate was taken Upstairs in Second Reading Committee. I am grateful in particular to the hon. Members for North-West Cambridgeshire (Mr. Vara) and for North Devon (Nick Harvey) for their support. I am pleased also to see my hon. Friend the Member for Aberdeen, North (Mr. Doran) in his place. I know that as Chairman of the Administration Committee, he has taken a particular interest in parliamentary ICT and in the Bill.

Clause 1 establishes the key principle that there can be joint Departments of both Houses of Parliament. Although the two Houses have long since shared the building, they have always maintained separate administrations and staff. To some extent that must always be so, because there are occasions when the two Houses take contrary positions on the issues before them and require separate procedural support and advice. In recent years, however, it has become increasingly clear that it makes sense for the two Houses to share the management of much of our infrastructure. Until now, that has been achieved more or less satisfactorily by one House employing the staff to deliver a particular service and the other agreeing to make an appropriate financial contribution in exchange for a share in the service. For example, the House of Commons has managed the staff who maintain the buildings for both Houses while the House of Lords has managed the staff of the joint parliamentary archives.

20:45:00

Over the past 20 years, Members of both Houses and the two administrations have become increasingly dependent on ICT services. In response, during the 1990s the two Houses created a combination of joint and separate functions to meet the new requirements. In addition, most of the specialised Departments and offices of the two Houses acquired their own computer applications and staff, all under separate management arrangements. The consequence was that at the beginning of the present decade we had acquired myriad overlapping IT systems and teams. That is why, in 2004, the House of Commons Commission and the House of Lords House Committee accepted the recommendation from the Clerks of both Houses that there should be a single strategically managed ICT service functioning, for the first time, as a joint Department. It was agreed then that the new service called the parliamentary information and communication technology service—PICT—should be set up on an interim basis.

As parliamentarians, we all know that our dependency on ICT can only increase—a point tellingly made in the excellent report by the Administration Committee, “Information and communication technology services for members”. High-quality ICT services are essential for all Members to fulfil their responsibilities to their constituents and in Parliament. That requires careful strategic management on our behalf, and it eminently makes sense for them to be managed on a joint House basis. PICT is already operating in a shadow form, but for the longer term it needs a stable framework for joint employment, which is what the Bill is designed to achieve. Clause 1 therefore establishes the principle of joint Departments, and the remaining clauses flesh out the details.

Mr. Shailesh Vara (North-West Cambridgeshire) (Con)
I welcome the Deputy Leader of the House and congratulate her on her appointment. I did so previously in a Committee Room, but this is her first time at the Dispatch Box. I hope that she and I will be able to work together constructively, as I was able to with her predecessor, the hon. Member for Sherwood (Paddy Tipping), in the best interests of all in this House.

As the hon. Lady said, this is not Government legislation but business of the House. As such, it is good to see that it is not contentious and has the agreement of all shades of the political spectrum. Among those who agree with the Bill, I am pleased to see the Chairman of the Administration Committee, the hon. Member for Aberdeen, North (Mr. Doran), and we also have agreement from the hon. Member for North Devon (Nick Harvey), representing the House of Commons Commission.

It is not my intention to detain the House for too long, but I should like to make a few comments. As we have heard, the Bill sets up a joint Department for parliamentary information and communication technology. It is extraordinary that in the 21st century the Palace of Westminster still operates as two separate units, whereby we have separate entities for retaining staff, signing contracts, holding property and the like. Although there has been very close co-operation, it is good that we are at last getting modern in the Palace and recognising the need for joint Departments.

In the case of information technology, there used to be some nine separate units serving all the various people and Departments in both Houses. In January 2006, it was decided to set up a joint Department, and it is fair to say that on the whole the work of that Department has been very good, subject to the odd error at times, but with constant work on improvement. The vital service provided to all of us was rightly highlighted in an Administration Committee report in May of this year. The report spoke of our enormous reliance on information technology and the work that the staff of PICT do on our behalf in this House, and in our constituencies by way of remote services.

The Bill seeks to formalise the initial Department that was set up by creating one with the power jointly to employ staff, on behalf of both Houses, and to safeguard their rights, as well as to protect the rights of future employees, particularly regarding employment legislation, while ensuring the applicability of the Transfer of Undertakings (Protection of Employment) Regulations 2006. The Bill also provides for the corporate officers of the Department to be able to sign contracts and to hold property and the like on behalf of both Houses. Let me emphasise that those corporate officers can operate only with the explicit approval of the House of Commons Commission and the other place.

Finally, the Bill provides for the future creation of other joint Departments, but let me emphasise that such Departments will be created only if there is agreement from both Houses. Given the obvious economies of scale, the pooling of expertise and the likelihood of better services all round, it is good to see that this Bill provides for such a future eventuality. Possible future candidates for joint Departments may well be the proposed parliamentary visitor centre, the Refreshment Departments, the Libraries and the Official Report. Although I understand that there are no plans at present for any further joint Departments, it is worth noting the contents of the Tebbit report on House of Commons management and services, which was published on 18 June. It encourages the House to consider further joint Departments with the other place, but it nevertheless cautions that we should see how this first joint Department operates. With those comments, Mr. Deputy Speaker, I shall conclude for the moment.

The Chairman of Ways and Means (Sir Alan Haselhurst)
Order. I just point out to the hon. Gentleman, and for the benefit of everyone else, that now we are in Committee, I am Mr. Chairman or Sir Alan rather than Mr. Deputy Speaker. That is just a small point.

Sir Robert Smith (West Aberdeenshire and Kincardine) (LD)
Thank you, Sir Alan. I, too, welcome the Parliamentary Secretary to her new post and her first Committee on the Floor of the House. I wish her well because she has an important role to play in ensuring the smooth operation of the House for all hon. Members.

Clause 1 establishes a simpler way of getting joint operations between the two Houses and, as has been said, anyone looking in from outside might be a bit surprised about the situation. However, we have to remember the history of the two Houses and the fact that they are separate constitutional entities. Therefore, over time, they have evolved separate ways of functioning. Now, it makes a lot of sense to bring them together if we can, if we do so for the sake of efficiency and effectiveness.

PICT may have had glitches, problems and so on, but we welcome the extra support that has come from trying to build a larger organisation to support our IT. If I think back over the 10 years since I have been here, I can say that the changes in what hon. Members have been able to do through IT support in remote areas in order to access this building and documents have made quite a difference. The hon. Member for Aberdeen, North (Mr. Doran) recognised that having 650 small businesses to serve is quite a challenge for PICT and it is important to use the new structure to take that forward.

It would be interesting to hear from the Parliamentary Secretary what other joint Departments are in the pipeline. How far advanced are the ideas of setting up other joint Departments to bring other efficiencies to support Members of both Houses? Are there any at the moment, or are we dealing with this Bill purely to ensure that PICT is established, meaning that it will be some time down the line before we see further evolution building on the back of clause 1?

Mr. Frank Doran (Aberdeen, North) (Lab)
I welcome my hon. Friend the Parliamentary Secretary to her new position. It is a much deserved promotion and I look forward to working with her on the Bill and on many other issues in future.

I welcome the Bill, which is long overdue. In my current post as Chairman of the Administration Committee, I have learned that each House jealously regards its distinctive character. It is important to examine ways, as we are doing with PICT, to rationalise—that is sometimes a dangerous word—and improve services. Anyone who reads the Administration Committee’s report on PICT will realise that, even in the short space of time that the organisation has been operating in a unified manner, the service for Members of both Houses has dramatically increased. As the hon. Member for West Aberdeenshire and Kincardine (Sir Robert Smith) said, glitches and problems remain, but we are working hard on them with PICT and improvements will continue. I hope that our report provides a way ahead for that.

On other matters, there is clearly scope for integration. The hon. Member for North-West Cambridgeshire (Mr. Vara) mentioned some of those that are under consideration. We have co-operated with the other place on several issues, most notably on providing an education unit. We have especially poor services for children who visit this place. By co-operating and co-ordinating, we hope to have an improved education unit in the not-too-distant future.

I hope that the experience of PICT and developing the education centre will lead to other developments. It makes sense in this modern world that economies of scale will apply to both Houses. Improvements in services should accompany them and I look forward to that.

Helen Goodman
I am most grateful to all hon. Members who have made such kind remarks and for the constructive support that they offer to the Bill.

The hon. Member for Kingston—

Sir Robert Smith
West Aberdeenshire.

Helen Goodman
I am sorry. Let me say to the hon. Gentleman that the Bill sets out a general proposition for joint Departments because it took slightly longer to bring forward the measure than would have been the case from a management point of view because of the shortage of parliamentary time. There are no plans for new joint Departments, but if decisions are made later, we will not need to wait for full establishment. I hope that that is satisfactory.

Question put and agreed to.

Clause 1 ordered to stand part of the Bill.

Clause 2

Exercise of functions of the Corporate Officers

Question proposed, That the clause stand part of the Bill.

Helen Goodman
The Bill establishes the principle that there may be joint Departments. For the time being, as we have already said, there are plans for only one—PICT. During our earlier proceedings, Members of both Houses expressed a range of views on the desirability of extending the joint Department model to other services used by both Houses, such as catering, the Libraries and Hansard.

The recent review of management and services of the House of Commons by Sir Kevin Tebbit also encourages us to explore further joint working with the House of Lords in the interests of greater efficiency.

I agree with those who have said that we need to adopt a gradualist approach. Organisational change always needs to be tackled sensitively and with proper planning and consultation. As the Administration Committee said in its recent report:

“Such an exercise requires a clear and coherent approach if it is to be successful. Even with such an approach, it will take time for the new organisation to work optimally”.

So the Bill provides for the option of future joint Departments, but it also creates some safeguards. Clause 2 requires that any proposal from the two corporate officers to create or add new functions to a joint Department would have to be agreed by both the House of Commons Commission and the House of Lords House Committee. In the House of Lords, in accordance with the traditions of that House, it would also go to the Floor of the House.

Question put and agreed to.

Clause 2 ordered to stand part of the Bill.

Clause 3

staff

Question proposed, That the clause stand part of the Bill.

Helen Goodman
Clause 3 provides some key safeguards for staff who may be moved into a joint Department of Parliament in the future. It provides that pay will be kept broadly in line with pay in the Home civil service, which is already the case for staff of the House of Commons under the House of Commons (Administration) Act of 1978. It provides the same broad alignment for other conditions of service, with the important proviso that arrangements must be consistent with the requirements of the two Houses; and thirdly, it creates an absolute requirement that staff pensions should be kept in line with the principal civil service pension scheme, again a statutory requirement that already exists for staff of the House of Commons.

Mr. Doran
The Minister is aware that the trade unions have an issue with the changes that might occur to their current position. Under the 1978 Act, they have the right to go directly to the Commission and they are concerned that that right will not be preserved. Undertakings have been given that the right will remain, but it will not be a statutory one.

Helen Goodman
The reason we have not been able to incorporate into the Bill the provisions of the 1978 Act that provide formal access for the trade unions to the House of Commons Commission is that, in this instance, the joint Department is the employer. The trade unions have always made their feelings known to the Commission and they will continue to be effective in doing that. The heads of the joint Department will keep the Commission and the House of Lords in touch with what they are doing.

Access to the Commission, as under the 1978 Act, has been invoked on only two occasions, on both of which the issue was remitted immediately to ACAS for arbitration. That is what is proposed in the draft disputes procedure for the joint Department. In practice, there will be no serious lessening of the real and effective rights of the unions. There is also an effective Whitley structure in the House of Commons and a new Whitley structure for the joint Department is in the process of being established. I hope that satisfies my hon. Friend the Member for Aberdeen, North (Mr. Doran).

Question put and agreed to.

Clause 3 ordered to stand part of the Bill.

Clause 4

staff transfers

Question proposed, That the clause stand part of the Bill.

Helen Goodman
rose—

The Chairman
Order. Before the Minister speaks to the clause, I should mention that if she is going to introduce every clause as helpfully as she is doing, the need for an extensive debate on Third Reading debate may be obviated.

Helen Goodman
Thank you, Sir Alan.

Clause 4 applies the Transfer of Undertakings (Protection of Employment) Regulations 2006 in full to the transfer of staff into a parliamentary joint Department. There has already been a full process of consultation with the trade unions representing our staff at every stage of the exercise. As I have said, both Houses have established Whitley processes, and preparations for a new Whitley structure are being established.

Question put and agreed to.

Clause 4 ordered to stand part of the Bill.

Clause 5

Application of enactments

Question proposed, That the clause stand part of the Bill.

Helen Goodman
Clause 5 ensures that the employment law that already applies to the staff of the two Houses separately would apply to the staff of a joint Department. It also provides that other enactments that apply to either House would apply in the same way to something done by or in relation to a joint Department as it would if it were done by or in relation to each House. For example, the Data Protection Act 1998 would apply to data held by a joint Department on behalf of either House in the same way as it would if they were held in each House.

Question put and agreed to.

Clause 5 ordered to stand part of the Bill.

Clause 6 ordered to stand part of the Bill.

Schedule agreed to.

Bill reported, without amendment.

Order for Third Reading read.

21:07:00

Helen Goodman
I beg to move, That the Bill be now read the Third time.

It is very rare for us to legislate for the administration of Parliament, the last time being in the Parliamentary Corporate Bodies Act 1992. The purpose of the Bill is to facilitate the provision of joint services to both Houses, through a unified management structure under the direction of an official who is accountable to both Houses. The Bill is a sensible evolutionary measure that recognises the reality that the two Houses co-operate in many practical areas of day-to-day administration, even when they sometimes disagree on larger matters. The Bill enables us to co-operate in a new way by employing staff in joint Departments. In doing so it gives full employment protection to our staff in the way that I am sure the whole House would wish and expect. The Bill provides for a management structure that should deliver services more efficiently and provide scope for procurement savings and value for money for the taxpayer. However, the most important thing is that PICT should be customer focused—in other words, that it provide the services that Members want and need in a timely and effective manner.

Between the Bill being published and considered in another place and coming to this House for its Second Reading, the Select Committee on Administration produced its excellent report “Information and Communication Technology Services for Members”. I am grateful to my hon. Friend the Member for Aberdeen, North (Mr. Doran) and all the members of the Committee for their hard work in producing the report. It referred—I know that this will strike a chord with many hon. Members—to what it described as an undertone of dissatisfaction with the services currently provided. There are issues about remote access to the parliamentary network, technical support for constituency offices and the maintenance of equipment.

The evidence to the Committee from Members of Parliament provides salutary reading. It demonstrates that politeness is not a substitute for effectiveness, nor courtesy for competence. The right hon. Member for North-East Hampshire (Mr. Arbuthnot) said:

“PICT does not provide quick and competent support”.

My hon. Friend the Member for Brent, South (Ms Butler) said that PICT staff seem “very inexperienced”. My right hon. Friend the Member for Norwich, South (Mr. Clarke), commenting on his experience as a Minister, said that

“the various software incompatibilities meant that I could not access my diary or update my address books in ways that ran across both of my systems. The consequence of this is constant juggling”.

My hon. Friend the Member for West Lancashire (Rosie Cooper) wrote about her concerns about the contracts with suppliers, and the hon. Member for North Devon (Nick Harvey) mentioned the problems for those of us whose constituency location means that we require remote access in rural areas. The right hon. Member for Fylde (Mr. Jack) wanted more discussion between PICT and users, and the hon. Member for Isle of Wight (Mr. Turner) believed that there were

“fundamental internal communication problems”.

I know that there have been tangible improvements over the past year. PICT has recently opened two PICT local offices—on the first floor of Norman Shaw South and in 2 Millbank—where Members can drop in with problems or requests and also see a model office set-up. I understand that PICT is also refocusing its management structure to deal with the agenda now set by the Administration Committee report, so that there is one director for Members services. I wish to assure hon. Members, however, that the Leader of the House and I understand the very real frustrations that many Members feel. I have met the director of PICT and discussed these serious issues with her.

The establishment of the new Department is also an opportunity for a major step forward in the quality of services. PICT is now considering the recommendations of the Administration Committee report as a possible work plan for the next three years and hoping to address ways of improving performance, constituency support and access, and mobile log-ins. Some of the issues involved—for example, extending the support available to us in our constituencies—might require additional funding, and that will be a matter for the House of Commons Commission to consider when it responds to the Administration Committee report. A menu of costed options will be given to the Commission before the end of the year.

One of the key issues in the Administration Committee report is the need for a regular channel of communication between Members and PICT concerning Members’ needs and service requirements. The Committee has suggested that there should be a Members’ ICT customer forum, chaired by a Member of this House, but also involving representatives of our staff working here and in constituency offices. The House of Commons Commission will respond formally to the report in due course and will take a view, but I am sure that all hon. Members will agree with the principle that PICT must focus on what its customers are saying and on the problems that we have. In order for that to happen, we need to improve the channels of communication.

However, the immediate effect of the Bill will be to enable the first joint Department, PICT, to operate on a stable and sustainable basis and, as I said earlier, to move the management of our critical ICT services to the higher level that a 21st century Parliament expects. Once again, I am grateful to all hon. Members present for their support.

21:12:00

Mr. Vara
This is an important Bill that sets out to improve the services to both Houses of Parliament. It is fair to recognise that it is part of Parliament’s evolutionary process to help it to come forward into the 21st century. We all hope that it will lead to better services, greater efficiency and better use of the taxpayer’s money in running the Palace of Westminster.

I understand that all the affected staff and relevant trade unions have been extensively consulted regarding the joint Department. There is, nevertheless, understandable anxiety on the part of the unions about any future joint Departments. That point was picked up by the hon. Member for Aberdeen, North (Mr. Doran). It is important to emphasise for the record that, if there are to be further joint Departments, it is vital to have full and proper consultation with all the staff concerned and all the relevant trade unions.

May I take this opportunity to thank all the staff of the joint Department. I accept that there are still problems, especially regarding remote services to our constituencies, but efforts are being made to improve the services all the time. An example is the addition of two new offices, one in Norman Shaw South and the other in 2 Millbank. This has been a period of enormous change and uncertainty for the staff concerned, and I hope that, now that the Bill is progressing, matters will settle down for them. In such circumstances, staff are not thanked often enough, and when they are thanked, they are not thanked generously. I think that I speak on behalf of us all when I say that they do a wonderful job. Without them, we would all be very much at a loss, so it is good to have our appreciation put on the record.

May I also thank all those who have taken part in all the debates and those who worked in Committees such as the one chaired by the hon. Member for Aberdeen, North? Although this particular Bill has not seen too many contributors, it is nevertheless fair to say that those contributions have been just as important as when many more have contributed.

May I conclude by thanking all the House Officers for their involvement throughout the process? My personal thanks go in particular to Richard Ware, the director of resources at PICT. His personal help and assistance has been much appreciated.

This is a unique Bill, which heralds the changing way in which the Palace of Westminster will be run in future. Let us all hope that it will be very much for the better.

21:16:00

Sir Robert Smith
I also support Third Reading and I echo the concerns about the anxiety felt by staff at any time of change. Even when there is no intention to cause disruption, there are always moments of anxiety and uncertainty for the staff involved, so the management of that change has to be handled sensitively and effectively through proper dialogue and negotiations.

It is also important to recognise that the benefits from reorganisation will depend on how it is delivered and managed. The Bill is fairly dry and simple legally and technically, but its delivery and outcome will make a difference. As the Deputy Leader of the House highlighted in her Third Reading speech, many practical and active things on the ground need to be sorted and dealt with. That will not come from a piece of legislation alone; the Bill will not change things overnight. It does, however, create a structure through which those things can be managed more formally and handled more effectively. It should therefore provide more stability on which to build for the future. I welcome the Bill and wish those who now have to deliver its promises all the best in bringing it forward.

Question put and agreed to.

Bill accordingly read the Third time, and passed without amendment.

Delegated legislation

Mr. Deputy Speaker (Sir Alan Haselhurst)
I propose to take motions 5 and 6 together.

Motions made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation).

Companies

That the draft Companies (Political Expenditure Exemption) Order 2007, which was laid before this House on 24th May, be approved.

Social Security

That the draft Housing Benefit (Loss of Benefit) (Pilot Scheme) Regulations 2007, which were laid before this House on 20th June, be approved.—[Mark Tami.]

Question agreed to.

Aldrin Quibuyen

Motion made, and Question proposed, That this House do now adjourn.—[Mark Tami.]

21:17:00

Adam Price (Carmarthen, East and Dinefwr) (PC)
I am grateful for this opportunity to raise the case of my constituent, Mr. Aldrin Quibuyen, and his family, who are currently subject to a detention and removal order. I am asking the Minister to consider revoking it tonight by using the powers of discretion at his disposal.

Perhaps I should begin by briefly setting out the facts of the case. Mr. Quibuyen, who is a qualified nurse, entered the UK entirely properly and in accordance with immigration rules in 2003 with a work permit for his employer Craegmoor Healthcare, and was granted leave to remain until 2008. In May 2005, a new work permit application was approved for a change of employment to Caeffair nursing home, but the granting of a new work permit also necessitates a new application for further leave to remain to be lodged within six months. Mr. Quibuyen should have been informed of that by his new employer, but due to a combination of administrative error and some confusion on his part, a new application was not launched for a full 15 months. As a result, Mr. Quibuyen was informed by letter on 29 November 2006 that his application for further leave to remain had been refused. The reason given was that he had breached his condition of stay by continuing to work for an employer without the required permission. His leave to enter was then curtailed as a result and, as that has now passed, he and his family are being asked to leave the UK as soon as practicable.

I would like to say at the outset that it is undeniable that Mr. Quibuyen, in failing to submit the proper form within the allotted time, was in breach of the regulations; and the officials acted perfectly reasonably and within the terms of the rules. I have to say, however, that if I had to leave the country every time I forgot to fill in a vital piece of paperwork, I would have been deported many times over the years. It is an easy mistake to make. I think that there is plenty of evidence to prove that in this case that is precisely what it was—an honest mistake. Mr. Quibuyen remained in contact with the authorities throughout his time here, and thought that he was complying with the regulations. When he realised his mistake, he admitted it and sought to rectify it.

That brings us to the question before us tonight: is the evidence of Mr. Quibuyen’s good character and honest intent sufficient basis to warrant the use of ministerial discretion for which the regulations allow? I think that there are good reasons for applying that discretion in this case. First, Mr. Quibuyen is diligent, extremely hard working and much appreciated by his employer, and by the hundreds of people for whom he has cared during the four years he has worked here. If he were a citizen, we would call him an exemplary citizen. For the first two years he managed to sustain himself, sent money home to his family in the Philippines, and saved enough for a deposit on a house so that his family could join him, as they did in December 2004.

Individuals like Mr. Quibuyen, who work hard, pay their taxes and are never a drain on state resources, are concrete examples of the success of the Government’s immigration policy, with its emphasis on managed migration to plug vital skill gaps in particular sectors and local labour markets. We all know that the national health service, and the care sector more widely, could not function as well as they do without the valued contribution of overseas workers in general, and in particular the high quality care provided by nurses from the Philippines.

The second reason for reconsidering the removal order is the extent to which the family have integrated with the local community in Ammanford. Mr. Quibuyen’s daughter, Phebe, was born here, and his son Buzz—Aldrin—is doing very well at school. He has learned Welsh and English, and recently won a spelling award in both languages. The family are part of our community and the people of Ammanford have taken them to their hearts.

Since December last year, Aldrin and his wife Rhoda have been unable to work or provide for themselves or their family. It is testimony to the high regard in which Aldrin—affectionately known locally as Al—and his family are held that throughout this incredibly difficult time they have been entirely sustained by the financial support of their local church, the Salvation Army and the generosity of ordinary people in Ammanford. I also pay tribute to Carmarthenshire county council, which has been very understanding in dealing with Mr. Quibuyen’s council tax arrears. I am grateful to the council for that.

As I am sure the Minister agrees, that tradition of hospitality and solidarity is the true picture of race relations in this country, and it is something that we should celebrate. The Minister will have seen a petition bearing thousands of names and received hundreds of letters from members of the public asking him and his colleagues to reconsider.

In the times in which we live, of course it is right and proper for the Government to insist on a tightly policed system of rules governing who can and cannot enter and work in this country, but it is also right for there to be enough flexibility for Ministers to use discretion in cases where there is no deliberate attempt to deceive and a punitive approach would clearly not be in the public interest. In instances like this, in which an honest mistake has been made, such an approach might well send the wrong signal to honest individuals who may merely have delayed submitting the forms. They should be told that if they contact the authorities, it will not necessarily be a case of automatic deportation: there should be flexibility, and each case should rightly be judged on its merits. Sending Mr. Quibuyen and his family back to the Philippines would devastate him financially and emotionally. He would lose everything that he had worked for and his family, already uprooted once, would be uprooted again—all because he had overlooked a form of which, regrettably, he was not sufficiently aware.

There are good compassionate reasons to reconsider, but also more hard-headed reasons. It is people like Mr. Quibuyen—people of good character who are prepared to work hard and abide by the rules, and whose skills we desperately need—whom we should keep in this country. Like thousands of others who have come from the Philippines and elsewhere, Mr. Quibuyen came here to answer our call for people to plug the skills gap in the health and care sectors. I think that we should honour those people’s commitment by treating them fairly and reasonably.

The Minister is fair minded and he will have had an opportunity to review the full facts of the case. I hope that he will see the merit of some of the arguments I have presented. I appreciate that rules should be observed and enforced, but on this occasion I think that there is cause to think again about what is the appropriate course of action.

21:25:00

The Minister of State, Home Department (Mr. Liam Byrne)
I thank the hon. Member for Carmarthen, East and Dinefwr (Adam Price) for having initiated the debate. I agreed with much of his analysis of the requirements of our immigration system, and he is right that people such as Mr. Quibuyen have, over the past decade, made an important contribution to the health and social care sectors. About a quarter of the work permits issued to foreign nationals in that period have been for employment in those sectors. Many successful applicants are well qualified and provide compassionate and effective care, and the work they do is important not only to national systems but to local communities.

In the case in question, I think that honest mistakes were made in submitting the application. There is a degree of complexity in how to apply for such work permits, and this case underlines the need for us to simplify the system, which is why we propose to introduce a points-based system next year and to overhaul radically the way in which employers sponsor employees.

The hon. Gentleman has set out the basic facts of the case. In essence, Mr. Quibuyen applied for and entered the country under a work permit with one employer, with 16 months leave, then he changed jobs a couple of years later and reapplied, not realising that he also needed to refresh his leave in line with his new authority to work in the country. Therefore, a little later on he was out of time and the form he filled in was the wrong one, so when it was resubmitted it was rejected as an out-of-time application. Subsequently, Border and Immigration Agency officials—acting properly and in line with the immigration rules—refused the application and curtailed the leave in a way that they thought might be helpful, but which had the effect of striking out appeal rights. All of that led to protracted correspondence, and I am grateful to the hon. Gentleman for persisting with this matter.

I have recently asked for the case to be reviewed. It is clear to me that an honest mistake was made, given the background of the family and the integrity they have shown both in work and in how they have interacted with the Border and Immigration Agency to comply with the reporting restrictions that they were asked to honour. Therefore, this is a suitable case for discretion to be exercised. I propose to grant Mr. Quibuyen and his family a period of leave, to allow him and his employer to remedy the situation.

I am grateful to the hon. Gentleman for bringing the case to the attention of the House. It is important that Members have the opportunity to test on the Floor of the House how policy that we debate in Whitehall and Parliament is translated into practice. Sometimes that translation is not perfect; this was a case in point.

Question put and agreed to.

Adjourned accordingly at twenty-eight minutes past Nine o’clock.