If he will make a statement on the impact of his budget on the incomes of pensioners. [159873]

As a result of our personal tax and benefit changes in Budgets since 1997, pensioner households will be on average £600 a year better off. The basic pension has increased from April by £5 a week for single pensioners and £8 a week for couples. I can also confirm that we value the winter allowance, the Christmas bonus and free television licences for over-75s and that they will be retained. We will reject options that put at risk the basic pension.

Does my right hon. Friend agree that the interests of pensioners in my constituency could only be grossly damaged by the Tories abysmal plans for pensions—

Order.

Order. The hon. Gentleman's question is out of order.

Does the Chancellor of the Exchequer really believe that pensioners—people who have lived a very long time—are going to be fooled by a pension increase that he gives them just before a general election? Will not pensioners' enduring memory of this period of office be that they were given a miserly 75p by the Chancellor of the Exchequer? Was that not only one of a series of major gaffes that the Chancellor has made, and is it not the case that he has started this election campaign with a series of gaffes on tax and public spending that have left his economic policy in disarray?

What the electors of this country remember is that the right hon. Gentleman was in the Treasury when VAT was put on fuel. Let us consider what has really been happening in the past few years. First, there was the winter allowance, which Conservative Members opposed. Secondly, there were free television licences for the elderly, but Conservative Members opposed them. They also wanted to abolish the Christmas bonus, and they do not want the pension credit.

This morning, the shadow Chancellor said on television, "You are perfectly right that if people choose to take the option to move out of paying into the national insurance fund, there would not be as much money to pay current pensioners. So we have to fill the pump, and we can do that by a variety of ways, but for a start by selling gilt. Some of you will have spotted that if people are moving out of the national insurance fund there will be a hole in it. Yes, that is true."

So now we know that not only do Conservative Members oppose the winter allowance, free television licences, the pension credit and the Christmas bonus, they are putting at risk the very basic state pension by their proposals to allow people to opt out of the basic pension and to privatise it. They would run up massive borrowing and debt. They are not competent on pensions, and they are not competent to run the economy.

No one will believe that nonsense from the Chancellor, but people will remember him as being completely insincere, completely ineffective and completely irresponsible. He is the Chancellor of the Exchequer who was elected to deal with the welfare state, and he was the man who said that he would reform welfare. However, now that the Opposition have made a proposition to make future generations of pensioners much better off and remove the liability on future generations of taxpayers to pay taxes into the future, all he can do is try to make cheap political points.

It is the Conservative party that has the courage to look to the future and the idealism to aspire that future generations of pensioners should be better off. He is the Chancellor of the Exchequer who, by taxing the pension funds and by drawing ever more people into means-tested benefits, has ended up with 700,000 more people living in poverty.

It is very interesting that at the last Treasury Question Time of this Parliament, the shadow Chancellor cannot answer the question that has been put to him—[Interruption.] This morning, when the shadow Chancellor was asked on television how he would finance the basic pension in future years as a result of proposals that would allow thousands, perhaps millions, of people to opt out of the basic pension, his only answer was, "Well, we would have to discuss that with financiers. It might be bonds. It might be any system."

After four years in opposition, Conservative Members come to the electorate with pension proposals for people to opt out of the national state pension, that would raid the national insurance fund and put pensions at risk for millions of pensioners who are now insecure as a result of those announcements by Conservative Members, yet they cannot tell us how they would fund their proposals.

I will tell the House who the losers are: in Kensington and Chelsea, 12,000 pensioners are benefiting from the rise in the state pension; 13,000 are benefiting from the winter payment; and 6,000 are benefiting from free television licences. The Conservatives cannot be trusted on the economy; they cannot be trusted on tax; and now they cannot be trusted on the basic state pension.

The Chancellor has been peddling this nonsense all morning. Nobody believes him and he might as well give it up as it will not run. In just one respect, however, he was getting near the truth: the next time we meet across the Dispatch Box, I will be answering the questions. I will introduce a novelty to the House in respect of the past four years as I will answer the questions.

In opposition, the Chancellor told us that he would end means testing for elderly people. He has wantonly increased the numbers of people who live in poverty and have to come cap in hand to the state in order to get a living wage and to pay the stealth taxes that he has imposed on them. Our alternative agenda is to allow pensioners to keep more of their money. We will never forget that it is the pensioners money. It is not the Government's money, the Chancellor's money or Gordon Brown's money. It is the people's money and we will allow people to keep more of their own money. We will increase by —2,000 the amount that pensioners can keep before they pay tax. Does not the Chancellor agree that that will be a winning policy with pensioners in this country?

What I agree on is that the Conservatives have put in their manifesto a proposal that millions of people could potentially opt out of the basic state pension. That would mean that the national insurance fund would not have the money that was necessary. The Conservative Centre for Policy Studies has calculated that to be —6 billion. The Actuary has calculated it as —6 billion within three years. The question that the Conservatives must now answer is how they will fund the national insurance fund contributions that are necessary for the basic state pension without cutting the basic state pension or running up massive borrowing. When asked this morning whether he could fund the basic state pension, all the shadow Chancellor could say was, "I will have to discuss this matter with financiers. It could be bonds. It might be any system." So Conservative Members, some of whom are making a valedictory appearance, will have to explain—and we will get down to the detail—in every constituency in the country how their opt-out plans can go ahead without raiding the national insurance fund, putting the basic pension at risk or running up massive debts and massive borrowing that would have to be paid for with higher interest rates. Although the shadow Chancellor refuses to answer the question today, and Conservative Members have now fallen silent, they will have to answer that question in each constituency up and down the country.

May I suggest that my right hon. Friend ignores the rantings of the shadow Chancellor and spends his energy and effort on developing the pension credit? A fully developed earnings-related pension credit could be the future new deal for pensioners in constituencies such as mine.

I am grateful to my hon. Friend and I applaud the work that he has done during his parliamentary career in support of pensioners and employment in his constituency. He is absolutely right. The Conservatives opposed our plan for the new pension credit. Nor is it supported in their manifesto. They are against the winter allowance and free television licences; they are against the minimum income guarantee and the pension credit and now they propose putting the basic state pension at risk. If that is the Conservative pledge for pensioners, I doubt whether they will want to give it out to pensioners in any constituency.

Why should any pensioner trust this Chancellor when he has just stung elderly people in care homes with a new stealth VAT charge which will cost some of them more than the miserly 75p a week increase in the pension? Will he promise to abolish it? Will he support abolition and will he apologise to all the pensioners who will be stung yet again by his dreadful stealth charges?

That is completely incorrect. I would have thought that the right hon. Gentleman would have wished to acknowledge the authorship of the opt-out pension plans. After all, he and others wrote pamphlets in the 1980s saying that people should opt out of the basic state pension. He is now controlling the policy of his Front Benchers from the Back Benches, but he, too, will have to answer to his constituents. Why does he put the basic state pension, the winter allowance and the pensioner credit at risk? Each Conservative Member will have to answer those questions.

What steps he is taking to increase the proportion of national income spent on public investment. [159874]

What real terms increases he plans in investment in public services in each of the next three years. [159876]

When the Government came to power, public sector net investment was equal to 0.5 per cent. of national income. The plans set out in the 2000 spending review will increase net investment to 1.7 per cent. of gross domestic product by 2003–04—a doubling of net public investment. The Government, with our expenditure and investment in health, education, transport and the infrastructure, are turning around 20 years of underinvestment and modernising our public services.

I thank my right hon. Friend for that reply, because increased investment in my constituency means a modernised accident and emergency department, new school buildings and work starting on major transport infrastructure projects. After years of Tory neglect, my constituents know that we need that investment to continue if we are to regenerate the area properly. Can my right hon. Friend give me that commitment and will he also give a high priority to housing investment, so that a hallmark of the next Government will be a decent home for all?

I am grateful to my hon. Friend for the work that she does on behalf of her constituents. She is absolutely right, and additional investment in housing is included in the public expenditure review. Equally, 68 hospital projects are proceeding as a result of decisions made since 1997, 17,000 schools have been improved and we are recruiting more nurses, teachers, doctors and consultants. That is the way forward to rebuild the public services. The choice at the election will be between those who would invest in the public services and those who would cut investment. Conservative Members will have to go back to their constituencies and explain which hospitals and schools they would cut, which nurses they would make unemployed and which teachers they would make redundant.

I thank my right hon. Friend for his reply. The investment so far in the schools and hospitals that serve my constituency has brought definite improvements and is most welcome, but what is needed is a second Labour term in which a sustained radical programme of investment, in partnership with local government and other public bodies, would provide the quality services that the people of this country deserve and demand. Will he guarantee that?

I am grateful to my hon. Friend and I thank him for the work that he does. Education expenditure is rising by £4 billion a year and it will continue to rise by £4 billion a year under our spending plans. Equally, health service expenditure is rising by £5 billion a year. It is rising from £49 billion to £54 billion to £58 billion to £64 billion. When have the Conservatives ever been able to talk about measures of investment as good as those and on a sustainable basis? I know that the choice in the coming campaign will be between more investment under this party and cuts in investment under the Conservatives.

Would the Chancellor advise voters to take more account of his plans for public spending or more account of his record? Will he for once admit that his record on public spending is as bad as that of the Conservatives, with average spending on health and education in this Parliament lower as a proportion of national income, not higher? Will he also admit that even at the end of the current spending review, Labour will spend less in 2003–04 as a proportion of national income than the Tories did in 15 out of those dreadful 18 years?

The hon. Gentleman asked me to talk about my record as well as my ambitions. Schools capital will have risen from the £600 million we inherited to £3.2 billion. Some 17,000 schools are benefiting from modernisation. In individual schools, an extra £3,200 brings the total amount paid to many primary school head teachers to £9,750. A typical secondary school head teacher can get up to £115,000 for the school.

That is what we have done already, but in addition we plan to make available an extra £4 billion every year. I remind the hon. Gentleman, now that we are considering the past as well as the present and future, that the Government introduced a windfall tax on the utilities when we came to power. More than £1 billion of that money has gone to schools, but the Liberal Democrat party opposed the windfall tax. Will he say whether he still opposes it, as that is money that has gone to schools and education?

Has the Chancellor noted that the International Monetary Fund and the European Commission have both publicly warned him that his public expenditure plans are unsustainable, that they are incompatible with the European stability pact to which he unwisely signed up, and that they must inevitably lead to both inflation and higher taxes?

First, the stability pact that the hon. Gentleman finds so unacceptable was signed not by me, but by the previous Conservative Government. Secondly, he puts himself into a difficult position given his history as an ally of the European Commission. I will tell him what I told the Commission, which is that we will stick to our spending plans. They are the right spending plans for this country, and mean more hospitals, schools, teachers and doctors. They are what the people of this country want. The choice is between investing more under a Labour Government and major cuts in investment under a Conservative Government. The hon. Gentleman no doubt supports those cuts, but the Conservative party will have to explain them.

First, I thank my right hon. Friend for putting extra public investment into housing, which was desperately needed after the previous Conservative Government slashed billions of pounds off housing investment. Will he commit to putting further investment into housing over the next four years to ensure that the homeless have a hope of a home, and that council tenants can enjoy security and investment in their homes? Does he agree that the Government's investment pledges are in sharp contrast to what the Opposition propose? The previous Conservative Government slashed investment in housing, and in their dying days removed the safety net for the homeless. More recently, the Opposition have blocked the Homes Bill, thus preventing further hope for the homeless. They now plan to sell council homes over the heads of their tenants, who will have no choice in the matter.

As always, my hon. Friend puts her constituents case very well. We will continue our spending plans on housing, health and education, because they are right for her constituents and for the constituents of every Member of Parliament. People will look at the Conservative plans for spending cuts, but they will also see that huge additional spending commitments have been slipped into the Conservative manifesto. They include family scholarship schemes, progress centres outside schools, a cops-in-shops initiative, secure training centres—[Interruption.] Tory Members are now cheering public expenditure.

The problem for Conservative Members is that they will have to explain why none of their figures add up. They have made tax promises that are way in excess of what the country can afford. They say that they will cut spending, but are unable to deliver. Then, to please different sections of the electorate, they make spending commitments that they cannot afford. There are so many people on the Conservative bandwagon that there is not enough room left for the band.

How many people have been affected by the abolition of the married couples allowance. [159875]

We are replacing the married couples allowance with the children's tax credit as part of a package of measures to focus resources on families with children. The children's tax credit is worth over twice as much as the married couples allowance and will benefit about 5 million families.

I declare an interest in the answer to this question, as I am getting married in 15 days. Does the Paymaster General accept that the abolition of the married couples allowance was in effect a stealth tax on marriage, and that about 5 million couples who benefited from the allowance do not benefit from the child tax credit system? Does she also agree that 1 million of those who could benefit from the child tax credit system do not, and will not, because they have not applied for it? As a result, 6 million families are worse off. Would not it be much more straightforward to reintroduce a married couples allowance that would benefit all families with children under 11 years of age? I am glad to say that that will not include me.

I congratulate the hon. Gentleman on his marriage in 15 days' time. I am sure that he would accept that he is not in need of any financial encouragement to get married and does not believe that he would have benefited from the married couples allowance.

The resources used for the married couples allowance were paid regardless of marital status. The allowance was paid to single parents, divorcees and couples. The Government have focused those resources on supporting families with children. Some 85 per cent. of those who are entitled to receive the £520 a year through the children's tax credit have applied for it. I am sure that after the hon. Gentleman's wedding, he will join the Government in campaigning to ensure that the remaining 15 per cent. receive that money as well.

I served on several Finance Bills during the previous Parliament, in which the Conservatives cut and cut the married couples allowance without any compensating action for families. Is it not the case that the majority of people welcome the Government's focus on child poverty, and that they welcome not only the children's tax credit but the record increase in child benefit, the working families tax credit and child care tax credits, which have benefited families more than twice over, as my hon. Friend has said?

I understand that this will be my hon. Friend's last appearance in this House as he takes up his full duties in the Scottish Parliament. His campaigning for the Government to tackle child poverty is well known. He has made a substantial contribution to the development of the policies on the working families tax credit, the increase in child benefit and the increase in income support levels. Those policies have ensured that the Government have already lifted 1.2 million children out of poverty, and intend in the next Parliament to lift another 1 million children out of poverty.

What plans he has to review the taxation of pensioners. [159878]

As a result of our policies, seven out of 10 pensioners pay no tax or pay tax only at the l0p rate. As my right hon. Friend the Chancellor said, following our personal tax and benefit changes, pensioner households will be £600 a year better off on average since 1997.

Given that the savings ratio has fallen to its lowest level since 1963, that millions of pensioners face billions of pounds worth of extra taxes, and that half of all pensioners are get to be on means-tested benefits by 2003, why does the right hon. Gentleman not increase the age-related personal allowance by £2,000 and take 1 million pensioners out of tax altogether? Those are Conservative policies to help people who work hard, who save hard, who try to be independent of the state and who believe in this country.

We are helping all pensioners with the increase in the basic state pension and the introduction of the minimum income guarantee, giving greatest help to the poorest pensioners. We introduced the winter allowance, which Conservative Members opposed and would abolish. We will not adopt their proposals because they would do nothing to help the majority of pensioners. The distribution effects show that more than 90 per cent. of the benefit goes to the richest third of pensioners in the country, confirming 3et again that the Conservatives stand for the few whereas we stand for the many.

The pensioners in my constituency who face the greatest difficulties are those who were badly affected by the scandalous collapse of Chester Street Holdings and who suffer from asbestos. related diseases. As this is the last Treasury Question Time before the election, does my right hon. Friend have any news for those people?

I shall be setting out details in a written answer shortly, but I am delighted to confirm to my hon. Friend that we have reached agreement with the insurance industry that the claims of Chester Street victims will be met by the industry using appropriate policyholder protection schemes. I am grateful for the flexibility shown by the insurance industry in helping to cut through what was an extremely complex legal situation. I congratulate my hon. Friend and other hon. Friends on their campaign, which has ended the uncertainty that was hanging over the victims and their families.

May I do something that is extremely relevant at Question Time? On this occasion, I thank the Minister for that reply to the question from his hon. Friend the Member for Clydebank and Milngavie (Mr. Worthington). I, too, have campaigned with Members on both sides of the House to obtain justice for those who are dying from asbestos-related diseases—in particular, my constituent, Mr. Donald McCreery, who has only a few months to live. The announcement, in the dying hours of this Parliament, will bring great happiness to him and his family. I thank the Minister and the Government for the work that they and Back Benchers have done to bring about justice. Surely, that is what the House is about.

I thank the hon. Gentleman for his generous remarks. As he says, there was an all-party commitment to resolve the matter. I am only too pleased that, as he says, in the dying hours of this Parliament we have been able to achieve that security and justice for people suffering from terrible diseases, who, with their families, would otherwise have been left in unendurable anxiety. I am pleased that they can look forward to the compensation to which they are entitled.

The 13,240 pensioners in my constituency are extremely grateful for the extra income that they have received under the Labour Government after 18 very hard Tory years. Will my right hon. Friend give wide publicity to his plans for the pensioners tax credit, which will reward those pensioners who have been thrifty and saved hard all their lives?

Yes, my hon. Friend can look forward to extensive publicity promoting the benefits of the pensioners tax credit during the coming weeks and, thereafter, along with the other extra help that we have given pensioners, which is ensuring real increases in their living standards and real investment in the services on which they depend.

Does the Minister recognise that pensioners Feel worse off under Labour? They resent the indignities of the means test, and they want to decide for themselves how their pension is invested. In the circumstances, will he support our policy of cutting tax on pensioners, of cutting tax on hard-earned savings and of reforming the annuities rule? In short, is not the best advice that he could give pensioners for the next election: vote Conservative?

The hon. Gentleman was cranking up the spending commitments like nothing on earth. However, the truth is that the Conservatives cannot pay for their proposals because they cannot identify the savings on which they claim those proposals depend. Their proposals would leave a black hole in the national insurance fund. As my right hon. Friend the Chancellor pointed out, the shadow Chancellor—when challenged this morning about where he would find the money—could say only that he would talk to financiers, that it might be bonds or that it might be any other system. What it certainly would be is borrowing, which would destabilise the economy, push up interest rates, cut real living standards for everybody and hit pensioners worst of all.

Will my right hon. Friend give a commitment today that the winter fuel allowance and free television licence for those aged 75 and over will remain tax-free? Can he explain why, before the Government took office, not a single penny was given to pensioners for heating, whereas under the present Government such assistance was given from the beginning?

I congratulate my hon. Friend and thank him for the work that he did on the campaign on television licences. The answer to his question is yes, we can guarantee that those will be free of tax and, yes, it is true that when the Conservative party was in government it did nothing to help pensioners in those ways. That summarises clearly the difference between the parties and the choice facing the people in the general election. We are standing up for pensioners' interests, keeping our promises and delivering rising living standards and better services, but all that would be at risk under the Conservatives.

When he expects that his five economic tests for British participation in EMU will be fulfilled. [159881]

The Government's position on the five economic tests for the euro was set out in a 1997 statement to the House. The Government have said that the assessment will be made early in the next Parliament, so that British business is prepared for the introduction of euro notes and coins in 2002 in the euro area. I am today in consultation with business, publishing additional case studies showing how British businesses across a range of sectors have prepared for the introduction of the euro, thus helping British business to compete effectively in the single market, whether we are in or out of the euro.

Last week, the Chancellor got into the most terrible huff when the European Commission criticised his conduct of the economy. We all know from the Gould memo and from indiscretions on television that the Prime Minister wants to bundle us into the euro, against the wishes of the British people. As that will reduce the role of the Chancellor of the Exchequer of the United Kingdom to that of office boy for the European Commission, will he now go through each of the five tests and give his interpretation of where we stand today?

The Government's position is as set out on previous occasions. While we see the benefits in principle of the single currency, we shall subject it to five economic tests, which will be rigorously made early in the next Parliament. If we were to recommend that we join the single currency, we would report to Parliament, and then the people of this country would have the final say.

The difference between our two parties is that we are prepared to say that we support the single currency in principle, but will subject it to tests. The Conservative party cannot tell us whether it supports it in principle or is against it in principle. Indeed, some of those in the Conservative party support it in principle and some are against in principle. During the election campaign, they will have to make up their mind.

When my right hon. Friend comes to consider the five economic tests, particularly the question of whether the British economy is converging with that of the euro area, will he take into account the effect of enlargement on the economy of the euro area, and specifically the possible effect of enlargement on the value of the single currency?

All matters that are relevant will be taken into account in making the assessment, and we shall consider the effects on investment, employment and financial services. We shall consider whether we have the flexibility and we shall consider whether there is sustainable convergence. Those are the economic tests for Britain.

What the country will not support is a Conservative party that appears to want to rule out a single currency on grounds of dogma and is not prepared to examine what is in the national economic interest. I believe that, at the end of the day, people will want this decision to be taken on the basis of the national economic interest. By refusing even to support preparations by business, the Conservative party is not only the anti-European party in this country but the anti-business party.

In advocating the single currency, will the Chancellor make sure to remind the British people that every time that we have been on fixed exchange rates, unemployment has increased astronomically? Will he also tell the British public that the choice of rate at which we would join the single currency is not left to this country to decide, because under article 109 of the treaty it has to be decided in conjunction with other countries? In other words, we cannot pick a rate to suit this country and the economy of this country.

The hon. Gentleman's problem is that while he appears to be subjecting the single currency to the tests of employment and everything else, he has ruled out the single currency as a matter of dogma. His position is not to support it if the economic tests are met but to oppose it under all circumstances.

The Conservative party will have to make up its mind. The shadow Chancellor told Welsh Conservatives on one occasion that his policy was to keep our options open on EMU. He also said that a single currency would mean giving up the government of the UK. The Conservative party must make up its mind in this campaign. Is it against a single currency in principle, and therefore for ever, or against it only for one Parliament?

Is my right hon. Friend aware that one reason why he is in a position to tell the Commission and anybody else, including the International Monetary Fund, to get stuffed is that we now have the most successful economy in all my 31 years as a Member of Parliament? When the election is fought, one thing will be cettain: we shall not need any lectures from people who were experts in building deficits. This Government have managed not only to wipe out the debt left by the Tories, but to create a successful economy, which will provide more money for the health service, more money for schools and more money for the welfare state. I look forward in the next four or five years to more redistribution of wealth from the rich, who are represented by the Tories, to the many, who are represented on the Labour Benches.

I am grateful to my hon. Friend and thank him for his campaigning, particularly on behalf of pensioners.

Any Conservative party claims to economic competence have been undermined not only by what it did in government, but, today, by a manifesto that is unaffordable and not properly costed. When it comes to the campaign, the deputy Director General of the CBI has said that the Tory party's more eurosceptic view is not one that most CBI members would feel comfortable with, and that it is not in our commercial interest to have a eurosceptic Government. He also said that the CBI was once considered the corporate arm of the Tory party, but that most businesses. would take their hat off to this Government for getting Britain's message across better. In other words, the Conservative party is not just the anti-euro party but, indeed, the anti-business party.

Given the Chancellor's objections to and embarrassment at receiving orders from Brussels to cut his overspending plans, why does he continue with the silly pretence that a Labour Government's decision to join the euro would be based on objective economic criteria? The country well knows that the issue is a fundamental constitutional one, not least whether Britain should retain the ability to manage its own economy.

That really sums it up. I asked whether the Conservatives are against the single currency on principle or owing to the national economic interest. The hon. Gentleman has now proved that he is against the European Union altogether. It is hardly surprising that he had to apologise for calling for a renegotiation of our membership of the European Union. At this election, as I have seen from the Conservative party's manifesto issued this morning, it is against not only a single currency and helping business prepare for its introduction, but the treaty of Nice and single majority voting—and the hon. Gentleman is against the EU altogether. It is no wonder that businesses oppose the Conservative party.

When he will introduce VAT relief for community sports clubs. [159885]

What estimate he has made of the benefit to community and amateur sports clubs of his Budget proposals for tax relief. [159888]

The Government announced in the 2001 Budget their intention to consult on possible support through the tax system for community amateur sports clubs, which we recognise play a positive role in promoting health and cohesion in their communities. We intend over coming months to consult key organisations from the sports and voluntary sector, and to draw up a detailed proposal, which will be published for final consultation this year before the Government take it forward.

I thank my hon. Friend for that response, but will she take into account during the consultation the fact that many clubs have had to take up the slack as a result of the Tories flogging off school playing fields, and have had to spend more on providing sports facilities for young people?

The answer is yes. That issue will be taken into account, because we recognise the valuable contribution that such organisations make.

I am delighted that the Government have taken up my ten-minute Bill and I hope that, as soon as possible, I shall be able to see it proceed through its final stages in the next Parliament.

Does my hon. Friend agree that it is vital for sports clubs to benefit from the relief because they offer young people the opportunity to participate? The issue is not just about sport; it is about health, education and crime. The proposal is a prime example of joined-up thinking. It will ensure that people benefit from Government policy and shows the important role that sport plays.

I congratulate my hon. Friend on his ten-minute Bill and on his ability to influence the Government and to represent his constituents so well in the House—long may that continue. He will know that the Treasury and Customs and Excise are working with the Department for Culture, Media and Sport for precisely the reasons that he identified. Unfortunately, this is a complicated area of the tax system because of the various structures of sports clubs. However, we intend to take the measure forward and I hope that, when he sees the final proposals, he will be encouraged to continue to press the Government on such matters.

Does the Paymaster General not understand that hundreds of thousands of pensioners will take a dim view if the Government extend relief for VAT to community sports clubs at the same time as they impose a new stealth tax of VAT on pensioners living in care homes? The Chancellor is so ashamed of that stealth tax that he would not reply to the question that my right hon. Friend the Member for Wokingham (Mr. Redwood) asked about it.

It is a shame that the hon. Gentleman seems to be declaring that the Conservative party will oppose the Government when we introduce any reliefs for community and amateur sports clubs. On his allegation about VAT changes with regard to pensioners, I point out that there are no VAT changes—and I hope that he heard that. There will be no change in the proposals that are currently operational with regard to these services.

Although the Paymaster General's announcement is to be welcomed, does she agree that there is still a long way to go before the Government put back into sport and community organisations the large amount of tax that they take from them?

No, I do not agree with the hon. Gentleman. The Government have a fine record in supporting sports and community activities. The review that was carried out on the taxation of charities showed our commitment to supporting voluntary and charitable organisations. Clearly, the review of reliefs for amateur sports and community clubs adds to the contribution. He was quite wrong in his assertion.

What assessment he has made of the impact of his Budget measures on employment; and if he will make a statement. [159886]

Thanks to the tough choices and the platform of economic stability that my right hon. Friend the Chancellor's Budgets have put in place, we have the lowest unemployment for a quarter of a century and 1 million more people in jobs.

Does my right hon. Friend accept that people in Scotland particularly welcome the successive Budgets introduced under our Government? Because of those Budgets, 31,500 people have found work through the new deal, 120,000 have benefited from the minimum wage and the working families tax credit is helping 108,000 families to make work pay. Does he agree that the Government's economic strategy goes hand in hand with our social policy agenda, which is tackling poverty? Does he also agree that, while jobs are good for individuals and the country, having a job is also the best way out of poverty?

I agree with my hon. Friend. It is right at the heart of the Government's purpose to ally the economic conditions for growth and job generation with the opportunities and the help that people need to take advantage of those chances. We extend a hand up to those in the weakest position.

I congratulate my hon. Friend on his work in chairing the all-party poverty group and on the energetic and close support that he has given the new deal from its inception. Throughout the United Kingdom, the new deal has helped more than 290,000 young people off benefits and into jobs and more than 66,000 of the long-term unemployed have been helped to move from welfare to work. The promises that we made at the last general election have been kept, and we shall build on them in the future.

Will the Minister accept that since the Budget thousands of people have lost their jobs as a consequence of foot and mouth hitting both agriculture-related services and, in particular, tourism?

In that context, will the Government consider—even at this late stage of a Parliament—extending an interest-free loan system to help those firms that are in danger of going out of business, and introducing a grant system to help to relaunch businesses that might otherwise find that difficult to do?

We are very mindful of the acute difficulties that are being caused by the impact of foot and mouth disease, especially in rural communities. Help is being provided by the rural taskforce and other Government measures. such as the extra resources that we are giving to the small firms loan guarantee scheme and the extension of business relief. Moreover, we are deferring national insurance, income tax and value added tax payments, which gives tens of millions of pounds of help to hard-pressed businesses. As a result of consultations with the taskforce and others, the Government will continue closely to monitor the situation and consider the evidence to determine where further help is needed. The best thing that we can do is to get the footpaths and parks open—where it is proper and safe to do so—and the tourists back into our rural communities.

Will my right hon. Friend accept that all Labour Members celebrate the fact that we have achieved the lowest unemployment figures for 25 years? May I also welcome the Chancellor's commitment to achieving full employment in every region? Will his concept of full employment include bringing back into the labour market disabled people, lone parents and people over 55?

Again, I congratulate my right hon. Friend on his commitment to successful welfare-to-work policies, not only in his constituency, but across the country, and on the distinguished contribution that he makes in chairing the Employment Sub-Committee. Our commitment to full employment is about extending opportunities to disabled people, lone parents and others who have been cut out in the past. That is why we have the disabled persons tax credit, the new deal for disabled people and the new deal for lone parents. Each measure helps thousands of people to move from dependency to greater independence as part of the provision of opportunities for all, for which the Labour party and the Government stand.

Will the right hon. Gentleman accept that his reply to the right hon. Member for Caernarfon (Mr. Wigley) was pitifully inadequate? Does he not realise that there is great deprivation in rural areas as a consequence of foot and mouth disease? The measly measures that the Government have offered to try to meet the dire problem are absolutely inadequate. Will he address the issue, from his position of urban ignorance, and seek to do something about it?

That was an unworthy remark from the hon. Gentleman. We have been energetic in introducing help where help is needed. I have received letters of appreciation for the help that the Inland Revenue and Customs and Excise have given in deferring tax obligations. We have also extended extra help through the small firms loan guarantee scheme, and provided another £24 million just last week through the regional development agencies. In addition, the rural taskforce will continue its work during the general election, in consultation with all interested and affected parties, to ensure that we get our rural communities back to normal and to their former levels of prosperity and economic activity, to which we should all be committed. Those communities can draw scant comfort or help from the Conservatives, who want to cut public expenditure even when their Back Benchers say that they want more of it.

Will my right hon. Friend confirm that £6 billion pays for 30,000 nurses and 75,000 doctors, and provides minimum income guarantee payments for 2 million of our poorest pensioners? If he found a black hole in his budget, would he have the gall to explain to those people exactly what that meant? Would he be confident that he would get away with his life, given such wonky arithmetic?

It will not have escaped my hon. Friend's attention that the shadow Chancellor of the Exchequer has left the Chamber already. Perhaps he has left to speak to financiers to learn how he will plug the black hole in his funding. My hon. Friend is right: the Conservative party's prospectus threatens jobs. public services, living standards and investments. The electorate will not forgive Conservatives for putting forward such incompetent plans. Conservatives cannot show how they would be paid for, and they would put at risk economic stability and the social justice that the Government are providing.

If he will make a statement on the work of the Debt Management Office. [159889]

The Debt Management Office supports the Government's policies of minimising debt financing costs over the long term, taking account of risk and managing the cash needs of the Exchequer in the most cost-effective way.

I thank the Minister for that answer. The management of the Debt Management Office is a vital part of managing the economy. Now that the Institute of Fiscal Studies has identified a massive gap of £5 billion a year by 2004. will the Labour party cut its disastrously unsustainable expenditure plans, will it disastrously increase taxation or will it unsustainably increase debt? To fill the gap, should the British people mind the gap and vote Conservative at the election?

That was an extraordinary question for the hon. Gentleman to ask. In the year before the last general election, the Conservatives ran up borrowing of £28 billion. In the year before the impending election, we have a net repayment of £15 billion. The DMO is operating within a very different environment, in which the Government have sound public finances and sound money, as opposed to the spendthrift millstone of debt that the Conservative; put round our necks, and would do so again if they had the chance.

As for the performance of the DMO, the hon. Gentleman would have done well to read the Select Committee report that was published in May 2000, which stated:

"We were pleased to note that several witnesses who have regular contacts with the DMO, particularly in relation to debt management, praised the agency's performance and transparency."

There is a better financial situation that is being better managed with Labour.

Are not the general public entitled to one more statistic? How many thousands of millions of pounds of Government debt that we inherited from the previous Tory Government have the Labour Government paid off since 1997?

First, I thank my hon. Friend for his distinguished service and contribution to the House—[HON. MEMBERS: "Hear, hear."]—which he will notice is applauded on both sides of the Chamber I thank him also for the principled, energetic, good-natured, friendly and supportive way in which he goes about his work, which was reflected in his question. The answer is that we are reducing debt from the 44 per cent. of gross domestic product under the Conservative Government to 31 per cent., and a sustainable 30 per cent. for the years ahead.

Those are not merely statistics. The numbers reflect the money that is taken from working people's pockets. It was taken in the past to pay for the boom-and-bust instability of a Conservative Government, who ran up debts because they could not manage the economy effectively. In the coming weeks, our case will be built on the tough decisions that we have taken and the platform of stability that we have put in place. We can invest and grow, and generate further jobs for the future. All that would be at risk with the Conservatives.

If he will make a statement on the tax burden on poorer families. [159890]

By October 2001, as a result of the personal tax and benefit measures introduced over the Parliament, families with children in the least well-off fifth of the population will, on average, be £1,700 a year better off in real terms.

According to the Government's own figures, since they came to office the poorest fifth of households have had their tax burden increased by 12 per cent. Do the Government recognise that running a car is a necessity for many of even the poorest families, particularly in rural areas? They have introduced a regressive tax—there has been a massive increase in car taxation. Will the Minister join the Conservative party in cutting tax on petrol by 28p a gallon?

No, less well-off families are much better off, as independent research by the Institute for Fiscal Studies shows. Of course, the data to which the hon. Gentleman referred include only about a quarter of a year's worth of working families tax credit data and do not include subsequent increases in income support child credits and other improvements. He needs to explain to his constituents the fact that our measures will have taken 1.2 million children out of poverty during the course of this Parliament. There have been huge improvements, particularly for the least well-off families.

I beg to move, That the House disagrees with the Lords in the said amendment.

With this it will be convenient to consider the following: Lords amendments Nos. 7 and 8 and consequential amendments Nos. 1 to 7 thereto; Lords amendments Nos. 9 to 15 and Government motions to disagree thereto; Lords amendments Nos. 16, 17 and 68; Lords amendments Nos. 82 and 83 and Government motions to disagree thereto.

In setting the scene for the amendments, it is important to stress that this is a major Bill. It puts in place many of the measures and powers that are needed to modernise the NHS and to implement the NHS plan, which was launched last July with widespread support from the NHS, its staff, professional organisations and patients groups. The plan underpins the unprecedented investment in the NHS that this Government are making, but which the Conservative party would put under threat.

I am grateful to the Minister for allowing me to speak. I gather that the Bill is the flagship Bill of the Government in their dying days. Is there any particular reason why the Secretary of State is not here to present the Bill and speak to the amendments?

The hon. Lady knows that I have handled the great bulk of the stages of the Bill, and I am doing so today. My right hon. Friend the Secretary of State is taking part in a visit which in principle has been planned for many months.

For the first time in the history of the NHS. nursing care for the elderly will become free in nursing homes from October this year. Just in the past few days, the Conservative party has again made clear its preference for private insurance as the answer to long-term care. The Bill will protect patients and be fairer to GPs by improving the regulation of GPs and other primary care professionals. It will extend prescribing rights. It will strengthen joint working between the NHS and social services by allowing care trusts to be established. It will protect the essential work of cancer registries and other vital parts of the NHS by protecting the information flows that it needs. [Interruption.] As we approach the closing stages of the Bill none of those must be put in jeopardy. [Interruption.]

Order. The Minister knows that we are talking not about the general terms of the Bill, but about Lords amendments to it. He should speak to them.

I am grateful to you, Mr. Speaker. I was about to point out that because the Bill is so important we must not put its provisions in jeopardy at this stage in its progress through Parliament. The Lords amendments deal with two substantive issues: the reform of patient representation and patient information. This group of amendments deals with patient representation.

In all the challenges we face in modernising the NHS, the need to make the NHS patient-centred is one of the most fundamental. In the past 25 years too little progress has been made in that area. No matter how good each individual episode of clinical care is, too often patients feel that they have to make their way round the system instead of the system being built around their needs. They have to wait for an appointment that is inconvenient instead of being able to book one. They return time and again for different tests instead of having all the tests done on one day. Their passage from one part of the system to another, perhaps from the health service to social care, is not smooth and seamless as it should be. Too often simple problems, complaints and misunderstandings are not dealt with quickly, some then becoming major problems.

We are already taking action to tackle those issues, but we know and patients know that change will be faster, more effective and more lasting if patients and carers have a voice at the heart of every part of the NHS.

In the NHS plan we set out proposals for a radical change to the system of patient representation. In each trust and primary care trust a patient advocacy and liaison service will be able to tackle emerging problems there and then. A practical answer—

On a point of order, Mr. Speaker. Would it be in order for the Minister to tell us whether he is agreeing or disagreeing with the Lords amendment and, indeed, what he is talking about? We have one hour only.

The Minister is in order at the moment.

Only just.

The Minister is drawing a fine line.

I have sought to set the context. The Lords amendments set out proposals and amended proposals for a system of patient representation and empowerment. I hope that it will be possible to set out the Government's intentions in this Bill in trying to reform the system of patient representation, how the Lords amendments would affect that and the reason for the position that we take on the Lords amendments. I am very much in your hands, Mr. Speaker, but I hope that that approach will be acceptable.

In my experience amendments tend to be narrow and it is best to keep to the amendment before the House.

We set out radical reforms to the system of patient representation in the NHS plan. As the Bill progressed, the system was incorporated in many amendments. The Bill provided for patients forums, and we said that we wished to co-ordinate their work locally. We established a group to consider the representation of patients through a national patients body. It recommended that the body should be statutory, and such a provision was included in thy; Bill in the House of Lords. Government amendments and those tabled by others, such as my hon. Friend the Member for Wakefield (Mr. Hinchliffe), led to a radical and powerful Bill for patient representation. However, the amendments that were made in another place wreck the Government's approach, to which the House of Commons had made amendments.

The key amendment is technically and legally unworkable, and it would not provide the structural change based on independent patients forums or the important shift towards the direct representation of patients and carers that lie at the heart of the Government's proposals. The part of the Bill that we are considering is controversial, and I believe that, before the Lords amendments, the measure was a significant improvement on the original. It reflected much of the discussion that took place inside and outside Parliament. Many people, including many in community health councils, will be disappointed that the provisions will be withdrawn.

At this stage of a Parliament, progress on Bills depends on the rapid agreement of both Houses. Several Bills have already fallen because such agreement was unattainable. The most disgraceful example is the Tobacco Advertising Bill, which has fallen because of Conservative party—

On a point of order, Mr. Speaker. Is it pertinent for the Minister to mention a different Bill when we have only one hour to debate the measure?

Regardless of the time available, all hon. Members, including Ministers, must keep to the amendment that we are considering. It is a narrow amendment.

I hoped to draw attention to the fact that other Bills had suffered the same fate as the part of the measure that we are considering. We made significant efforts to find an agreed way forward in the light of the Lords amendments. However, given the time constraints imposed by an impending general election, it is clear that the Bill would be jeopardised unless we removed the clauses that related to patient representation.

We are determined to empower patients more. However, we are also determined to lift the burden of nursing costs from elderly people and their families as soon as possible; indeed, from October. We shall give up the clauses because we are not prepared to put at risk free nursing care for the elderly. We are determined to fulfil our commitment to pensioners.

The amendments that we have tabled, alongside the Lords amendments, will remove the necessary clauses from the Bill. We agree with Lords amendments Nos. 7 and 8, which remove the clauses on patients forums and patients councils. We disagree with Lords amendments Nos. 14 and 4 to remove any link between independent advocacy and patients councils. Lords amendments Nos. 16 and 17, with which we agree, ensure that CHCs will continue. We must therefore disagree with Lords amendment No.15, and thus remove the national patients body. We regret its loss and believe that the proposed wider role and membership, and the opportunity to include voluntary organisations that represent patients, would be a considerable step forward. However, we cannot have two national statutory bodies that both seek to represent patients and the public. We must therefore withdraw the proposals for the new body.

We must reconsider how to pick up the proposals from the feasibility study, that we established on national patient representation. It was carried out for the Department by a consortium of leading patients' organisations. We do not wish to lose sight of the vision that it set out in its report.

We oppose Lords amendment No.6, which seeks to transform CHCs into patients councils and reduce patients forums to mere sub-committees of CHCs. As I said earlier, that does not offer the basis of a realistic or workable way forward. The clause is technically deficient. If it were left on the statute book, it would lead to future arrangements for patient representation being decided in the courts rather than in the House. Consequential to that position and the removal of patients forums and councils are our amendments Nos. 1, 2, 3, 5, 6, 7, 82 and 83, which remove clauses 14, 15 and 16, and further technical changes. The Government also disagree with Lords amendments Nos. 10, 11, 12 and 13, which would have amended the clauses relating to patients councils and forums.

It might be helpful if I summarise the effect of the Government's proposals on the relevant legislation and policy. Although the effect of the amendments would be to leave the legislation governing community health councils as it stands, the Bill will still introduce significant changes. Overview and scrutiny committees of democratically elected councils will scrutinise the NHS, a change that has been supported in both Houses and was unaffected and unchallenged by the Lords amendments. The change has broad support and we will want to ensure that it is implemented. Among other things, overview and scrutiny committees will be given the role of referring local service change proposals to the Secretary of State and the independent reconfiguration committee when the committee does not think the proposals are in the interests of the local population.

The Secretary of State will still have the responsibility introduced in this place to ensure the provision of an independent patient advocacy service, which also will be widely welcomed. The first patient advocacy and liaison services are now being established in trusts across the country, often involving former CHC staff.

My right hon. Friend the Secretary of State has recently set out our plans to have far fewer, but more strategic, health authorities. The move to 30 strategic health authorities has been widely welcomed.

On a point of order, Mr. Speaker. Could the Minister be asked to clarify to which Lords amendments those specific points relate?

We must allow the Minister to express himself as he wishes to express himself.

It might be useful to the House and for the benefit of Conservative Members—I have no intention of talking out this debate—if I set out as clearly as possible the legal and policy position that would pertain if the House were to follow the advice that I am giving on the Lords amendments that we wish to accept, the Lords amendments with which we disagree, and the Government's own amendments. I am briefly setting out that scenario.

I have made it clear—perhaps I need to repeat the points—that, although the legal position governing CHCs would remain as it is, there would be consequential changes to the Bill. Overview and scrutiny committees would take on the role that we have set out for them, and the Secretary of State will have a responsibility to provide independent patient advocacy services.

The move to 30 strategic health authorities is one of the matters that will govern change in the future. The change has been widely welcomed as part of our commitment to devolving power and resources to the front line. It would be ludicrous to assume that patient representation can be championed effectively by ever-more remote committees. What is needed is patient representation within every NHS organisation. We shall still seek to establish patients forums, which are an essential tool if patients are to challenge and change each part of the NHS. Although we would need further legislation to give them the statutory independence that we would like them to have, non-statutory forums can be established in the interim.

Change is therefore inevitable. We will have to return to those matters after the election and further legislation may be necessary. However, as we have said from the beginning, any change must be as seamless as is practical and make the best and most appropriate use of the skills and expertise that are already within the system.

Before I call the next hon. Member, I must draw the House's attention to the fact that privilege is involved in Lords amendments Nos.15 and 66. If the House agrees to either of those amendments, I shall ensure that the appropriate entry is made in the Journal.

I shall be relatively brief. None of us expected quite such a rapid victory for common sense as we have been seeing in the Chamber today. I share my hon. Friends' disappointment that the Secretary of State could not attend this debate and eat humble pie himself. It seems that he finds that diet unpalatable, and that the Prime Minister's three-week humility does not apply to all his Cabinet Ministers.

The Minister was scrambling round for a description of the Government's position as a consequence of their position on the Lords amendments, but I shall try to help him. Climbdown, U-turn and humiliation are all reasonable descriptions of his position today.

1 pm

As for the Minister's unmitigated drivel about the need to protect free nursing care, which is Conservative party policy, it really was a very poor excuse indeed. However, I am sure that he will have the gratitude of at least some of his Back Benchers for abandoning one of the most ridiculous and disastrous policies to emerge from the Department of Health in the past four years. We shall not divide the House, as we agree with the position that the Minister has taken on the Lords amendments. The effect of what the Government are saying today will be simply to return us to the status quo, which is where we wanted to be all along.

There would have been no need to have ridiculous and lengthy debates on the subject only to arrive back where we started, if only Ministers had been willing to listen to representations that were made the length and breadth of the country, by those of all party political persuasions and none, to the effect that this was a poor decision that was not in the interest of patients and only in the interests of those who wanted a lapdog rather than a watchdog for patients.

The Lords amendments will return us to the position that community health councils are currently in, acting as a one-stop shop for patients. The community health councils that were created by a Conservative Government in 1973 offer free labour to the NHS worth £8 million a year. Each year, community health councils assist about 30,000 people, yet they were kept in the dark about the Government's plans.

When Ministers were asked about consultation they did not accept that ACHCEW—the Association of Community Health Councils for England and Wales—or the CHCs themselves had any legitimate expectation of consultation on the proposal that CHCs should be abolished through primary legislation to be introduced in Parliament in due course. That arrogance was one of the main reasons why their Lordships were unwilling to accept the Government's plans. In addition, apparently the Government had no idea of what would happen to CHC staff or the records that were kept by CHC. All that made a poor situation overwhelmingly unsatisfactory. The overwhelming view on both sides of the House, which is held by everyone except those on the Government Front Bench, is that there should now be a reform rather than abolition.

Government Back Benchers who might have taken some short-term comfort from the Minister's words may not be so happy when they read the Department of Health press release that says that, should the Government be re-elected, they propose to continue with the abolition of community health councils. It will therefore be increasingly clear up and down the country that those who have been helped by community health councils, those who assist community health councils and those who work for community health councils will know that a vote for the Conservatives will keep the community health councils and a vote for Labour will abolish them.

I very much welcome the fact that the Government are going back to the drawing board on this issue. That will come as no surprise to anyone who has heard my previous comments on the Bill. On Second Reading, I said that the Bill

"contains many positive measures, but also some that need to be given further thought … Of particular concern are the proposals in clauses 7 to 14, regarding scrutiny and complaints … I feel that there has not been adequate public consultation and discussion … I get the distinct impression that the proposals regarding CHCs and scrutiny were something of an afterthought."—[Official Report, 10 January 2001; Vol.360,c.1104-105.]

As the Minister is well aware, my main concerns related to the fragmentation of the system that was being proposed to replace CHCs—the lack of independence and the lack of clear proposals for independent patient advocacy. I welcome the fact that the amendments on advocacy reflecting the concerns of the Select Committee on Health have been retained. We all accept that that is a major step forward.

On Report, I moved the new clauses in respect of patients councils in order to create an umbrella body that would draw together the various forums, reflecting the role that CHCs have undertaken over many years and the advocacy service to which the Government have agreed. I said:

"I make no bones about the fact that I am proposing a framework that needs to be examined in more detail."

I recognised that a lot more work needed to be done and said:

"We must consider continuity between any change and the new system. I genuinely hope. that some of those who have served so well on CHCs will make a major contribution within the new system."—[Official Report, 14 February 2001;Vol.363,c.395–96.]

That was what I felt needed to be done in the House of Lords. I am conscious that the deliberations in the other place were constructive, because the official Opposition changed their position between the Commons and the Lords. The Conservatives in the Lords actually backed the idea of patient councils as a reform that could improve the position of patients. I recognise that there were differences over du detail, including the issue of the relationship between patients councils and forums.

The Lords amendment does not reflect the importance of the patients forums, which will be front-line bodies that will play an important role. I understand the reservations of my right hon. Friend the Minister on that point and I also understand the difficulties involved in the continuity question. I welcome the Government's willingness to make further proposals in that area.

The hon. Member for Woodspring (Dr. Fox) said that we were back to the status quo, but he is wrong. He nodded a moment ago when I mentioned independent advocacy, which is a major step forward, and I am sure that he—and the Liberal Democrats, given their previous position—will support that reform.

If I may clarify the position, I meant that we are back to the status quo for the CHCs, and we welcome the additional proposals. Will the hon. Gentleman return the favour by telling us whether he will campaign in the general election on his party's ticket to abolish CHCs?

I made my position clear on Second Reading, when I said that the CHCs' functions need to be radically reformed, and the hon. Gentleman is well aware of that. I was a member of my local CHC for many years, and its members know that I believe that we need to modernise that scrutiny function and reflect the marked change in the whole direction of the NHS that has taken place, rightly, under this Government

I would welcome the assurance of my right hon. Friend the Minister on whether the advocacy arrangements proposed in the Bill will ensure, as the Health Committee suggested, that the advocacy function can be placed temporarily with CHCs, so that patients have a clear, independent voice. I would also welcome his comments on where the advocacy function will be placed, as the Bill stands, and on the current position of CHC members, who are hard-working volunteers and need some assurances about their future role.

I am also concerned about the position of the staff of CHCs and of the Association of Community Health Councils for England and Wales. Serious questions have been raised about their their job security and future role. Those people have done a good job in many respects and I would be grateful for my right lion. Friend's comments. I also wish to praise the work of Donna Covey at ACHCEW; she has attempted to work closely with the Government and other parties, in difficult circumstances, to reach some solution that will reflect the concerns of those who want a modernised system.

Patients also need some assurances about the interim period. Will they still have access to CHCs carrying out the functions that they now perform? Can my right hon. Friend confirm my hope that the advocacy function will be available, once the Bill takes effect, within CHCs to assist patients in a way that many of them are not now assisted?

The Government's proposals started out as a curate's egg and ended up as a dog's breakfast. We have taken the view from the beginning that what the Government proposed had three essential flaws. The first was a lack of independence in the arrangements. The second was a lack of cohesion—we were concerned that the system would be so fragmented—and the third was that no national body was proposed that would provide a voice for patients at national level.

During the progress of the Bill, some of those issues have been addressed in part. For example, the patients forums were taken away from the trusts, which originally were to fund and establish them. The provisions for independent advocacy also increased the independence of the new arrangements. The Government conceded in the other place that there should be a national body to represent patients at national level.

Just as the Bill was leaving this House, an amendment tabled by the hon. Member for Wakefield (Mr. Hinchliffe) proposed the creation of patients councils. That would have gone some way towards addressing the point about cohesion. We believe that patients councils could have become very worthwhile bodies, especially given the bigger health authority footprint that is now being talked about, and that they should have been responsible for the independent advocacy service.

The House of Lords, when it considered the amendment, wanted to put patients councils on a firmer footing. Their Lordships wanted the councils to be clearly marked out as successor bodies to the community health councils. It is regrettable that the Government did not feel able to accept that, but they seem to have concluded that it would be better to go back to a blank sheet; and we do not intend to obstruct them in that.

We will have to return to this matter, both during the election campaign and after it. If we are going to start from a blank sheet of paper, I hope very much that any decision made by the House about future arrangements for patient representation will provide for a set-up that is strong, independent, coherent, properly funded and represented by a national body.

The Government will feel some embarrassment that they have had to withdraw their proposal at this stage of the Bill's progress. The proposal was always flawed, but I have every hope that, after the election, we will arrive at an arrangement that is in the best interests of patients.

There are times when one's faith in the democratic process is confirmed, even in this Parliament under this Government. I raised the matter of the widespread opposition in the country to the Government's peremptory proposal to abolish CHCs at one Prime Minister's Question Time last year. I received a dusty answer and was told that consultation was being held and that a report on that consultation would be made to the House. Only three days later, the Prime Minister sent me a grovelling letter signed. as seems to be his habit, "Yours ever. Tony". In it, he admitted that a decision had been made and that the Government were not going to consult on the abolition of CHCs after all.

The abolition proposal was set out in the small print of the middle chapters of last summer's NHS plan. I am delighted that the Government's craven climbdown at this late hour means that the excellent Chester and Ellesmere Port and Cheshire Central CHCs will be able to continue their good work, under their respective chief officers Mr. Geoff Ryall-Harvey and Mrs. Jean French.

Those chief officers have not been assisted by the Government's brutal and mindless approach to the welfare of CHC staff and volunteers. I talked to Mr. Ryall-Harvey this morning. I thought that today's debate might turn out as it has, but of course was not able to say as much. The irony is that Mr. Ryall-Harvey told me that he had just returned from an out-placement session that was held because it was believed that the Government were confident that they would succeed in getting the abolition proposal through the House.

I am glad to say that the Government have failed, and that opposition to the proposal has emerged among hon. Members of all parties, including Labour Back-Bench Members, and in the other place. We have been deeply upset on behalf of patients, staff and NHS users at what amounted to an appalling attack on the independence of patients and on their confidence that they can discuss the difficult issues that arise when things go wrong. That is when people with grievous and worrying problems are at their most vulnerable and need people of independence and authority who can inspire confidence that solutions can be found.

These issues were highlighted during an excellent debate in Westminster Hall. I pay tribute to my hon. Friend the Member for Woodspring (Dr. Fox), the shadow Secretary of State for Health, and his team for having championed the retention of CHCs so successfully. It is common ground across the House and among CHCs that they need updating and reform. However, all the good work that they have done does not need to be undermined by the Government's wish to abolish them, which has done untold damage. The wind-down, in anticipation of abolition, has caused grievous morale problems.

1.15 pm

It must be made clear that, despite this shoddy process, the Government's shabby conduct and a shameful policy, this is only a temporary reprieve. If a Labour Government are returned, they will again campaign for the abolition of CHCs, and it will cause their Back Benchers no end of difficulty. We, however, will be saying. in any campaign and challenge that is put to Conservative party candidates in the forthcoming election, that we will retain CHCs, reform them and commit ourselves to their independence.

I am proud to have played a small part in the campaign to retain CHCs, and I am glad that the Government have given way at last on this terrible policy.

The House is grateful to my hon. Friend the Member for Eddisbury (Mr. O'Brien) for getting the Prime Minister, in effect, to mis-speak. In the follow-up letter, it was made clear that there had been no consultation before the Government's decision to abolish community health councils as legal entities.

I think that the reaction of the Association of Community Health Councils for England and Wales, which joined in the campaign strongly after a slow start, was based on what my hon. Friend the Member for Eddisbury did and also on the actions of the Worthing district community health council. It wrote to the association asking what action it would take. Then we discovered that what the Government assumed to be a done deal across the country was not one, and that community health councils had been objecting strongly. [Interruption.] Some Government Back Benchers must have pager messages saying "smile" at this point, but it is no laughing matter. It matters a great deal to people with hospital appointment problems, those who have concerns or who want to draw Ministers into the reconfiguration of hospital services. If the Government said that they had a fragmented responsibility to the CHCs to bring general practitioner services into their field, that would make sense.

I have in my hand a letter from one of my constituents, who is 71. His family doctor referred him to a specialist clinic. The letter he got back said:

"You have been referred to … the Pain Management Unit at St. Thomas's Hospital. We are writing to confirm that you are now on our waiting list, and we hope to be able to offer you an appointment in 15 months' time."

[Interruption.] The Government Whip may ask what this has to do with community health councils. CHCs would, rightly, ask how on earth that person was supposed to bear his pain for 15 months while the hospital decides whether it can offer him an appointment. That does not necessarily mean treatment. The Minister looks upset about this. He jolly well should be; so is my constituent.

People are doing more and more at Worthing hospital, but it should be plain. even to a Health Minister, that more is being left undone than was the case four years ago. The right hon. Gentleman may say that that is not so, in which case I refer him to his own answers, which show the proportion of people waiting for in-patient treatment for more than a year, how that figure compares with four years ago, and how it compares with the figure for the health authority covering the Prime Minister's constituency.

It would be propel for the Worthing district community health council to take up the question of a 47-week delay in seeing a consultant in Worthing hospital. If the Government want to extend CHCs' powers to include the family practitioner service, the overload there is probably just as great. Regrettably, family doctors in Worthing, south of the railway line—which has probably the greatest concentration of those over 85 in the country—have closed their lists to new patients and will now take only those referred through the health authority. For that to happen, after four years of the Government's stewardship, is something that CHCs should take up.

Ministers know that holding the election 12 months early has helped to save community health councils. They should drop the Labour party desire to abolish community health councils and seek all-party agreement to extend the CHC role to cover family doctor services. CHCs can thus help health workers—doctors, nurses and others; they are willing to take up complaints and, most of all, they ensure that there is a public, independent, knowledgeable and continuous voice to make plain that what is happening at present is unacceptable.

Ministers seem to fear people saying that what is happening is unacceptable, but waiting 15 months or 47 weeks to see a consultant and the closing of GP lists are certainly not acceptable to me. I doubt that they are acceptable to Labour Members either. CHCs have a proper role to play in ensuring that the situation changes and changes fast. Do not abolish CHCs.

I add my voice to that of my hon. Friend the Member for Wakefield (Mr. Hinchliffe). When we considered this matter in the Health Committee, we were convinced of the need for a less haphazard advocacy system that was genuinely independent. Advocates must be independent of the hospital trusts that employ them and which they investigate. We certainly need the advocacy system to be more widespread. The system must be strengthened by making it coherent and common to all trusts. It must be genuinely independent. I am glad that the Government have listened and that more acceptable proposals have been made.

I am grateful to my hon. Friend for reinforcing the points that I made in my speech. As this may be my hon. Friend's last contribution in the House, I feel it appropriate to pay tribute to him for his work on the Health Committee, and in representing his constituents in Morley and Rothwell and in local government over many years. He is still widely respected for his work as a member of West Yorkshire county council. I am sure that we all wish him well in his retirement.

Hear, hear.

I join in the tribute to the hon. Member for Morley and Rothwell (Mr. Gunnell) for his work on the Health Committee. As he will remember, he and I have jousted in Committees on several occasions. I, too, wish him well in his retirement.

I am extremely pleased that there has been a reprieve for the East Herts and North Herts community health councils, both of which have a valuable function in my constituency. They check on cleanliness in hospitals, investigate food quality and, at their statutory meetings with the health authority, have been instrumental in teasing out some of our financial problems.

My concerns about the proposals related to independence and continuity. The CHC representatives who carried out inspections of Queen Elizabeth II hospital in Welwyn Garden City and highlighted problems with cleaning contracts have a continuity of experience with that hospital. The representatives of the North Herts CHC who inspected Lister hospital, looking into diet and the quality of food preparation, also have that continuity of experience. They are independent; they say what they see.

It may not be convenient for Governments to have such independent people telling them what is right or wrong with local health services. However, as a Member of Parliament, it is helpful to me to know that there is a truly independent sounding board, which has continuity. The statutory meeting of the East Herts CHC certainly brought out—through questioning and contributions from the health authority—some of the financial difficulties that had occurred during the past few months in East and North Hertfordshire. That process was extremely helpful.

Can the hon. Gentleman identify a single way in which the patients forums or the patients councils, as we proposed them, would be less statutorily independent than CHCs?

One of the greatest achievements of the community health councils has been casualty watch. It is to have a national body—

rose—

Let me finish the point. It is to have a national body. which will be able to co-ordinate these matters, and which will be independent and able to communicate fearlessly the picture for the country as a whole. Governments do not like that, but the public at large and Members of Parliament certainly appreciate it.

Why would the national body as set out in the Bill have been in any way less, able to do casualty watch than the CHCs are at the moment? We have made it clear that it could do so equally well.

We want something that is genuinely independent, and we want it—[Laughter.] The Minister laughs, but independence is important. We are used to a Government who constantly spin figures and change the basis of figures—a Government who are all about spin rather than reality. If it is independent—

Does my hon. Friend agree that the problem is that the patients councils and patients forums as proposed in the Bill would be established by secondary legislation—regulations introduced by the Secretary of State—and would not be enshrined in primary legislation, as CHCs are?

My hon. Friend is right about that. All too often, we are asked to accept assurances. We know what the community health councils and the national body do at the moment. We are expected to give the Government carte blanche because they are nice people giving us assurances, but that is unacceptable. We want it in the law.

I am grateful to have had the opportunity to make this short contribution to the debate.

I am very disappointed with the situation that we now face. People have put a great deal of work into trying to find answers to a multitude of questions, but those questions remain on the table and all the work will have to start again.

A lot of work has been put in over the past 10 months to make sense of a set of proposals that, to start with, were fragmented and posed more questions than they answered. When the Bill left the House on Third Reading, it contained a much better set of proposals. The new structure for patient representation was not nearly as fragmented as it was when it was first suggested, thanks to the Government's acceptance of the amendment tabled by my hon. Friend the Member for Wakefield (Mr. Hinchliffe), and thanks to a great deal of work that had been done outside this place, by civil servants and others, to which the Government paid attention. With patients councils forming the overview and the administrative cohesion that was missing from the initial set of proposals, we had a structure that would have worked and would have made sense locally.

The statutory, independent patients forums would be very important for every part of the local health service. They would not perpetuate the traditional emphasis on hospitals—the acute sector—but would give equal importance to the primary care sector, and to community health services. Patients councils would have been well able to play the important role of fitting that structure together. They would also provide a means of disseminating and receiving information, locally, regionally and nationally, and a means of informing local authority scrutiny committees.

We have not returned to where we started, but the situation is unsatisfactory and unresolved, and people will still have in mind questions that they will pose in the weeks and months ahead, to which the Government will need to return in future.

Will the Minister give one assurance? Will he acknowledge that no system that deals with patient representation and patient empowerment will work unless it has the good will of all the people who are already involved in those areas? Most of them serve on CHCs and most are volunteers, but many work for other voluntary organisations, as my right hon. Friend will know. Their good will and work needs to be acknowledged. The Government could have begun the process in a better way with regard to those people. The process began 10 months ago and there has been constructive consultation since, but there will certainly have to be a great deal more of it to deal with these matters when the Government return to power.

I should like an assurance from my right hon. Friend that the views of those in the voluntary sector—voluntary members of CHCs as well as staff—will be taken on board, so that such people will be fully involved in returning to the drawing board to consider the new structure. We need the involvement of those people to make any new structure work.

We really should not be having this debate. If the Government had listened to what people had to say and genuinely consulted at the outset, as they pretended they had, they would have realised that the Bill's proposals were unacceptable. They are unacceptable to the Conservative Opposition, to all other parties in the House and, indeed, to the great majority of Labour Back Benchers. They are unacceptable to outside bodies representing patients and to most commentators on the subject. It is only the Government's arrogance that has resulted in their having to make such a humiliating climbdown at the 11th hour.

The Minister is wrong to suggest—indeed, the Labour party was wrong to suggest in last night's press release—that the climbdown is somehow in order to save the principle of free nursing care. I believe that all parties in the House have expressed their support for the introduction of free nursing care.

Clause 56 removes from local authorities the statutory duty to provide or procure free nursing care, and the power to do so. There is no reason why, if clause 56 had fallen and the Bill had not become law, the Government could not have introduced free nursing care by directing health authorities to pay for it—unless the Minister is suggesting that the country is littered with local authorities that would insist on paying for such care even when their health authorities were offering to do so and to provide it.

I do not want to take up too much of the House's time, but I should like to ask the Minister one or two specific questions: he has come to the House supported by the usual invisible army, and I know that he would be disappointed if I did not do so. How has he reconciled the retention of community health councils with the creation of overview and scrutiny committees? There will be significant overlap of their functions and a potential for conflict between them.

Will the Minister explain Government amendment No. 4, which proposes to leave out subsections (6) and (7) of proposed new section 19A, under clause 17, which deals with the introduction of independent advocacy services? Proposed new subsection (6) provides that, before making arrangements for independent advocacy services, the Secretary of State should consult the relevant patients council and any other persons "as he considers appropriate". Obviously, there will be no patients councils to consult, so it is entirely appropriate to remove that reference. However, why should the Secretary of State not consult

"such other persons as he considers appropriate"?

By removing the subsection, the Minister will be allowing the Secretary of State to introduce regulations for the provision of independent advocacy services without a requirement to consult anybody on doing so.

Government amendment No. 7 addresses schedule 5. It is not clear why the House should be minded to agree to the removal of a definition of a patient advocacy and liaison service, and to giving the Secretary of State free rein to define such a service through any regulations and in any way he chooses. I would be grateful if the Minister could elaborate on those two points, because they are not merely consequential amendments, but significant changes to the process that the Secretary of State will have to undertake.

Throughout, the Government's case for abolishing the CHCs is that they want to introduce something that is much stronger and much more effective. Their problem has been that no one believes them. It is true that CHCs are a thorn in the side of Health Ministers. The Minister knows that and my tight hon. and hon. Friends have told me the same thing. The function of CHCs is to be a thorn in the side of Health Ministers.

One of the most common outputs of CHCs that Members receive is the excellent publication "Casualty Watch". Let us consider the Government's version of their motivation. The Secretary of State was sitting one morning in his office reading a copy of the Daily Mail with the headline, "The abandoned patients—Catalogue of shame as hospitals leave elderly waiting on trolleys". The article beneath it added:

"A survey by Community Health Council workers across London revealed horrific examples of sick patients"

and so on. We are asked to believe that the Secretary of State said to his advisers, "I have a great idea. Why don't we strengthen these bodies? Why don't we make them more independent and more effective so that they can produce more of this type of documentation and circulate it to the press and Opposition Members of Parliament?" That is a totally implausible scenario.

Instead of waving about the publications of the CHCs, would the hon. Gentleman explain why the previous Conservative Government cut the budget of CHC News, which kept the members of CHCs, like myself, informed of the issues that the CHCs were taking up with the Government? That measure made CHCs less effective.

The hon. Gentleman might remember that the previous Conservative Government created CHCs precisely to undertake a scrutiny function.

The Government have got themselves into a position in which Labour candidates will go into the general election pledging to abolish CHCs. Those candidates will have to defend the indefensible position that the Government have adopted in wishing to destroy these independent watchdogs and voices for patients. As the hon. Member for North Devon (Mi. Harvey) said, the Government have created a dog's breakfast.

We are delighted that CHCs have been reprieved by the Government's climbdown today, but we would much prefer to hear that the Government permanently accept the advice that they have received from both sides of the House and from all sections of opinion outside that the CHCs should be retained and reformed, Instead, I hear from the Minister that this is a measure of expediency and that a Labour Government, if re-elected, would move swiftly to abolish the CHCs and remove the independent voice that they provide for patients.

When I outlined the Government's position, I was able to set out exactly what would happen as a consequence of the amendments. I shall not respond to the Conservative party's caricature of our position as I have set out the policy that we shall pursue in the weeks to come.

The debate has been revealing because not a single Conservative Members has engaged with the fundamental challenge that we set out to tackle. The fact is that, despite much hard work and good will, 25 years on, we do not have a patient-centred NHS or the structures that mean that it has been organised around the needs of patients. Nothing other than that fact motivated my right hon. Friend the Secretary of State, me and other Ministers to introduce the proposals in the NHS plan. They remain our commitment.

I do not criticise hon. Members who want to praise the work of their local community health council, but the debate revealed the extent to which the Conservatives have tried to caricature what the Government proposed. It simply is not true that we wanted lass independent and less powerful bodies, that were not as able to speak up for patients or to carry out activities—such as those performed by Casualty Watch—as the CHCs. We wanted to achieve a system of patients councils, patients forums and a national body that, taken together, would have been stronger, more powerful and, indeed, more independent than today's arrangements. I believe that we could have achieved that and had greater consistency across the country because everyone accepts that services are patchy and inconsistent. The hon. Members for Worthing, West (Mr. Bottomley), for Eddisbury (Mr. O'Brien) and for North-East Hertfordshire (Mr. Heald) clearly had not attempted to read or understand the Bill before it went to the other place or after it was initially amended there.

There is one reason—and only one—why the Government have reached this decision. Everyone knows that, at this stage of a Parliament, unless both Houses of Parliament agree on all aspects of a Bill, it will fall. In this case, the provisions for free nursing care would have fallen with it. If the hon. Member for Runnymede and Weybridge (Mr. Hammond) really believes that this primary legislation is not needed, it is a little late for him to speak up now. He did not say that previously. We need primary legislation so that we have a secure statutory base for what we intend to do. We are not prepared to lose free nursing care because both Houses cannot agree on other aspects of the Bill. That is a fundamental principle and the right position to take.

Will the Minister acknowledge that I raised that point in Committee?

I had not realised that the hon. Gentleman was also wrong in Committee, but if he wants me to confirm that, then fine. Doing things by direction does not provide a satisfactorily—

On a point of order, Madam Deputy Speaker. The Minister asked why I did not raise the matter before, and I told him that I had in Committee.

That is not a matter for the Chair

I apologise for not realising that the hon. Gentleman was wrong twice. I thought that he was wrong only once. For the record, however, I confirm that he was wrong twice.

Let me stress that we are not prepared to lose free nursing care because the two Houses of Parliament fail to agree.

I suspect that I will not have time to cover in detail all the issues raised. On the overview and scrutiny committees, we will need to consider in depth, after the election, the way in which their new powers will fit with the legal powers of CHCs. That is important. We will have to consider the best way of delivering advocacy services, to which my hon. Friend the Member for Morley and Rothwell (Mr. Gunnell) referred. Given the support of the CHC staff association for the Bill a few weeks ago, I regret the fact that there might be some uncertainty about it. We will want to work with them in the weeks and months to come to ensure that their position is properly looked after.

I beg to move, That this House agrees with the Lords in the said amendment.

With this we may discuss Lords amendment No. 39.

The amendment to section 8 of the Misuse of Drugs Act 1971 would facilitate police action against closed drug markets, such as crack houses. Under the 1971 Act, it is currently an offence for the occupier or manager of premises knowingly to allow illegal drugs to be produced or supplied on them. However, liability for the use of illegal drugs extends only to smoking cannabis or opium. That reflects the drug misuse patterns that prevailed when the Act was introduced. We believe that Lords amendment No. 15 will play an important part in updating the powers available to the police and the courts in tackling drug abuse, and it is supported by the police.

As we argued both on Report and in Committee, we felt that the change was not necessary. However, the official Opposition did not accept that view either on the Floor of the House or in private discussions that I had with the right hon. Member for Maidstone and The Weald (Miss Widdecombe). In the light of concerns about a lack of clarity in the legislation, we decided that it would be better to accept Lords amendment No. 15 than to have a rather arcane discussion about the legalisms involved in the particular circumstances. Consequently, both in the other place and in this place, we have accepted the amendment, which we hope will have the effects that have been widely advertised.

I am very glad that the Minister expressed his concession as he did. The amendment is the result of a very long-running campaign by the official Opposition which has been led by my right hon. Friend the Member for Maidstone and The Weald (Miss Widdecombe) and, in another place, by my noble Friend Lord Cope. My noble friends Baroness Buscombe and Baroness Hanham also have continued to press the Government on the issue.

We knew all along, as the Minister has very fairly conceded today, that the police were desperate for an amendment to the 1971 Act that enabled them particularly to clamp down on crack houses. As my noble Friend Baroness Buscombe said:

"These amendments represent the closing of a frustrating, glaring loophole in the law given the now sadly prevalent use of crack cocaine by illegal drug, users."

My noble Friend also mentioned the fact that, back on 23 January, Baroness Hanham had

"laid down a challenge to the Government to crack down on crack houses."—[Official Report, House of Lords, I May 2001; Vol. 624, c. 1759.]

A moment ago, in our previous debate, I mentioned some important amendments that have to be made to the Bill, and Lords amendment No. 15 is one of the most important of them. All of us know, and police are particularly aware, that crack cocaine is one of the most dangerously addictive illegal drugs. Very sadly, crack houses have become increasingly prevalent in our society, especially in inner cities and town centres.

The Opposition have been surprised that it has taken the Government so long to accept our arguments on this vital issue. Nevertheless, there is even greater joy in heaven over a sinner who repenteth. Even at the 59th minute of the 11th hour of this Parliament, the Government's acceptance of our view is welcome. We think that the amendment will add a strong weapon to the police's armoury in dealing with one of our society's most important scourges—illegal drugs, and particularly crack cocaine, which is one of the most dangerous.

I therefore welcome the Government's concession, although I wish that they had made it a great deal earlier. Nevertheless, even at the last minute, it is greatly to be welcomed.