Commons Chamber

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House Of Commons

Wednesday 16 January 2002

The House met at half-past Two o'clock

Prayers

[MR. SPEAKER in the Chair]

Oral Answers To Questions

Northern Ireland

The Secretary of State was asked—

Devolution

If he will make a statement on relations between the UK Government and the devolved institutions in Northern Ireland. [25591]

We are working constructively and in partnership with the devolved institutions in Northern Ireland to enable them to work as effectively as possible in the interests of the people of Northern Ireland.

Every decent person from both communities in Northern Ireland was outraged by the despicable murder of the young postman Daniel McColgan—a tragedy for him, his family and the entire community. Does my right hon. Friend agree that such acts of violence deliberately undermine the devolved institutions, which are the bedrock of the peace process? Will he tell the House what the Government, the Northern Ireland Assembly and all the other agencies are doing to protect those public sector workers who have been cruelly threatened?

Yes. As I said a few days ago, the vicious sectarian murder of Daniel McColgan is nothing less than a war on all the people of Northern Ireland, including those who are the youngest, schoolchildren, the weakest, old people, and the most exposed and vulnerable, public sector workers who work in the community because of their own dedication and commitment. I believe that part of the aim of those involved in such sectarian murders is indeed to undermine the progress that we have made and the stability, including that of the new devolved institutions, that we have in Northern Ireland as a result of that progress.

I believe that we owe it to Daniel McColgan and all the other victims of sectarian hatred to speak out with one voice across Northern Ireland. Indeed, there is a growing tide of revulsion at the activities of the paramilitaries. That is why I welcome all expressions of solidarity with what we are trying to do to create peace in Northern Ireland, including the trade unions' initiative to hold rallies on Friday lunchtime to express their contempt for the sectarian hatred.

As for my staff, I have made it plain and ensured that the 3,500 civil servants who work with me in the Northern Ireland Office and its agencies will be able to attend those rallies if they wish. These are extraordinary circumstances, and I understand that they call for an extraordinary unity of purpose throughout Northern Ireland. I hope that that will be widely supported and accepted by everyone involved.

May I associate myself entirely with everything that the Secretary of State and the hon. Member for Cumbernauld and Kilsyth (Rosemary McKenna) have said about the murder of Daniel McColgan and, indeed, about our concerns about recent events in Northern Ireland? The Secretary of State is right to say that elements in Northern Ireland—dissident republicans and elements in loyalism—want to undermine the devolved institutions and the progress, precarious though it is at times, that we have made, but does the right hon. agree that one of the hopeful signs about the disturbances in north Belfast in the past week is that the residents of the Upper Ardoyne-Glenbryn area were not willing to reinstate the protest at Holy Cross primary school? Does he agree that the fact that no protests took place is a sign of the progress that we have made and the way in which the devolved institutions, working on the socio-economic issues and with the Secretary of State, who remains responsible for security issues, is paying off?

Does the right hon. Gentleman agree that it is crucial in this situation that everyone does what he or she can to support the work of the police in Northern Ireland? We have had very serious reservations about what the Government have done to the police in Northern Ireland, and we feel that that has done a lot to undermine their effectiveness in the present situation, but at the same time, we will do all we can to support the police. In that context, is it not highly regrettable that republicans still withhold support from the police and that republicans appear to—

Order. I realise how sensitive and difficult this matter is, but this is Question Time and I call for short questions and, of course, short replies.

In that case, Mr. Speaker, yes, I did note the fact that protests were not staged at Holy Cross last week, and I commend all those who took that decision. It would have been the right decision under normal circumstances; it was even more welcome under last week's extraordinarily tense circumstances. Yes, I agree with the right hon. Gentleman on the need to support the police.

Most people will be bemused when they hear some people in the community in Northern Ireland demanding action from the police and demanding that the police stand up against that form of thuggery and violence, but when the police turn up to do just that, they are attacked from the back with petrol bombs and blast bombs, sometimes from members of the very communities that demand that the police take such action. The only way to stand against such violence is by remaining united and by having one voice and one purpose right across the community. That is the way to ensure that the police can be effective in defeating this violence.

The Bloody Sunday inquiry, once started, must obviously be allowed to complete its marathon. However, does my right hon. Friend agree that the costs of the inquiry, in particular the huge earnings being taken out of it by the legal profession, are in danger of discrediting the exercise in Northern Ireland? To create a gold mine out of such terrible and tragic events must surely be wrong. Does my right hon. Friend agree that the legal profession should consider the matter and consider making a voluntary reduction in its earnings from the inquiry? If it is unable to do that, will it consider making a hefty contribution to the victims funds in Northern Ireland?

We are always mindful as a Government of the costs of any enterprise, including inquiries. So concerned was I by some of the proposed increases in fees for lawyers at inquiries that I have caused the matter to be taken to judicial review. I am somewhat constrained in what I can say about it while the review is proceeding.

It is perfectly reasonable to say that the inquiry was a necessary part of investigating the truth to close a chapter on a very sorry episode in Northern Ireland's troubled history and, at the same time, to agree with the sentiments expressed by my right hon. Friend that we should not allow its substance to be detracted from by the enormous costs that appear to be being incurred. That would also detract from the real purpose of the investigation. Holding both views is entirely compatible.

Hon. Members on both sides will rightly condemn the atrocious murder of Daniel McColgan. One feature has been the widespread condemnation of that atrocious event and the threats against workers, both Catholic and Protestant, and school children, both Catholic and Protestant, in north Belfast. All such threats, violence and intimidation are to be condemned by all sides.

Does the Secretary of State agree that we have seen an upsurge in violence from elements on the loyalist side and from the republican side as well with the discovery of pipe bombs and the increase in the number of so-called punishment beatings and shootings? Will he therefore provide reassurance to my constituents in north Belfast who have yet to see any of the benefits of the peace process? In view of the murders and violence that we have seen, those people have a right to ask that the police and security are not run down and that the Chief Constable will be given whatever resources are necessary to combat the upsurge in violence. Will the right hon. Gentleman also give serious consideration to the introduction of measures such as closed circuit television in interface and flash-point areas, in an effort to provide immediate reassurance?

Unusually, I agree with almost everything that the hon. Gentleman said. Yes, the resources will be made available if necessary; yes, we will see what we can do to address the security problems in north Belfast; and, yes, as the hon. Gentleman knows, the First Minister, the Deputy First Minister and others are engaged in trying to address some of the social problems.

Even in the midst of the troubles that we face now and the terrible deaths, the one part of the hon. Gentleman's contribution that I do not agree with is that neither his constituents nor the people of Northern Ireland have benefited at all from the peace process. That is patently not the case, but I am the first to admit that we have an imperfect peace, as we have an imperfect democracy. We have a long way to go on both.

I join the Secretary of State and the House in condemning the terrible murder of Daniel McColgan and the murder of other people in Northern Ireland.

I say this with some shame, but does the Secretary of State agree that, in recent months, there has been an expression of naked sectarian hatred in certain areas of Northern Ireland that has been battened on to by the paramilitaries for their own political and mercenary ends? Does he further agree that the upsurge in revulsion on both sides of the entire community, right across the political spectrum, is perhaps a glimmer of light—a slight glimmer of hope—that we can start to lay our terrible heritage to rest?

I agree with my hon. Friend. In order for such evils to continue, it is necessary only that good people do nothing. That is why I welcome the unity of purpose, the declarations of intent and the practical demonstrations of opposition to both this violence and the sectarianism that is so often at its roots. Sectarianism is an evil that, once spread, will contaminate everyone.

I also agree that very often those sectarian causes that are supposedly espoused by some people on both sides of the community are a cover not so much for purposes of self-glorification but for the lining of their own pockets. We have to be very careful not to forget that paramilitary activity blights Northern Ireland not just with political objectives that it aims to achieve through violence, but with its degeneracy into organised crime, which my hon. Friend mentioned. Both of those will be ruthlessly opposed by the Government and, I hope, everyone in Northern Ireland.

I want to endorse on behalf of the Opposition every word that the Secretary of State and other right hon. and hon. Members on both sides of the House said about the hideous cold-blooded murder of Daniel McColgan. I also endorse what has been said in support of Catholic postal workers and teachers in north Belfast, and in support of all the people from both communities in Northern Ireland who, by continuing to go about their jobs and leading a normal life, are not giving in to violence and intimidation.

In the second half of last year, the Government launched on their lamentable course of not insisting on and waiting for the implementation of the Belfast agreement. When they went beyond it by making unilateral and unreciprocated further concessions to Irish republicanism, one of the many obnoxious things that they did was to agree at Weston Park to introduce an amnesty for on-the-run terrorists by the end of 2001. What is the current status of that promise?

First, may I welcome both the hon. Gentleman's support for the position that the Government are adopting and his presence in, and attempts to identify with, Northern Ireland during the past 48 hours?

Secondly, however, I take issue with the hon. Gentleman's proposition that we can govern and make advances in Northern Ireland merely by keeping to those arrangements that were specifically agreed in the Belfast agreement. There are many other things to take into account, including combating electoral fraud, and visits to the Province by Her Majesty. We could endlessly debate those because they are not in the Belfast agreement, but they are a natural part of good government.

Thirdly, on the hon. Gentleman's question, we have agreed to resolve the issue that arises from those fugitives who have not benefited under the terms of the early release scheme. When we have practical proposals on that, we will bring them to the House.

I take some comfort from the fact that 31 December 2001 has come and gone without the Government making that further concession to republican terrorists. I want to say once again from the Dispatch Box that, if we are to have a successful peace process in Northern Ireland, it is extremely important that two things occur. One is that the Government are rigorous in insisting that all parties fulfil their commitments under the Belfast agreement. No one should get any advantage, let alone new concessions, for failing to fulfil their undertakings. The second is that the Government need to maintain a balance as between the different communities in Northern Ireland, so that it does not seem as if just one party to the Belfast agreement is getting all the concessions.

Finally, I remind the right hon. Gentleman that the other day we discussed the difference between a concession and something that is done on its own merits. From his response just now, it seems that he still has not grasped the essential distinction. Of course we will agree with measures that are introduced on their own merits, but surely he cannot say that the amnesty for on-the-run terrorists is being introduced not as a concession but on its own merits.

I do not think that the terms of the Belfast agreement were merely a series of concessions to one side or the other. The other night, I pointed out that I regard the acceptance by republicans of the principle of consent not as a concession to Unionists but as a natural and right thing to do. The same is true of many other principles of the Belfast agreement. We resolved and made it public at Weston Park that we would tackle and resolve anomalies arising from the early release scheme; when we have plans that we want to lay before the House, we will do so.

Organised Crime

When the organised crime taskforce last met; and what was discussed. [25592]

The organised crime taskforce, which I chair, last met on 12 December to discuss how to build on the successes already achieved. Since then, on 10 January, a joint Customs and police operation seized a fuel-laundering plant in South Armagh that was capable of stealing £75,000 per week in unpaid taxes.

I congratulate my hon. Friend on the work being done by the taskforce. It is well known that organised crime raises money for terrorism. To what extent are the taskforce's successes stopping money going into the coffers of paramilitary groups, and to what extent is the taskforce contributing to the seizure of arms from paramilitary groups, especially those that are not signed up to the peace process?

At the heart of the Government's approach to tackling organised crime are efforts focused on—[Interruption.]

Order. Will the House allow the Minister to be heard? There is a great deal of noise.

Thank you, Mr. Speaker.

At the heart of the Government's approach and the task force's efforts is our recognition of the impact of organised crime on Northern Ireland's society. Organised crime undermines civic values the world over; the problem is compounded in Northern Ireland, where, unfortunately, paramilitaries have the apparatus and the will to commit crime for profit.

Money laundering is only one of many aspects of the development of organised crime of which we are aware, and the taskforce is assisting the organisations that comprises—public agencies that have come together to tackle organised crime—by utilising the best minds and the best trained financial investigators available. We are aware of the need to crack down on groups involved in organised crime; the debate on the previous question leaves no doubt that it is a factor that must be borne in mind. When faced with the sort of violence that we have witnessed in the past week, we must bear in mind the fact that the paramilitary organisations engaged in that violence are equally capable of turning their hand to organised crime. The role of the taskforce is therefore essential.

The Minister will share the revulsion felt by the vast majority of Northern Ireland's people against criminals masquerading as paramilitaries who are involved in drug dealing and driving drugs into our society, especially when their activities are directed towards young people and schoolchildren. She will also be aware of my strongly held belief that the only way to tackle drug dealers and put them out of business is to pass a law that allows phone tap evidence to be admissible in court. Will she put that item on the agenda of the taskforce's next meeting and draw evidence from the success in Italy, where, by using such a law, the Government have had great success against the Mafia and organised crime?

The hon. Gentleman has, rightly, raised that point before. We keep under constant review all the tools that may become available to the Government, with the assistance of the police and security forces our main focus. We have to continue the fight against organised crime and constantly bear in mind the link between organisations engaged in organised crime and paramilitary associations in Northern Ireland.

The taskforce has said that, along with money laundering and fraud, fuel smuggling is one of the most serious crimes committed in Northern Ireland, given its social impact. Does the Northern Ireland Office hold discussions with the Treasury to let it know that the land border between Northern Ireland and the Republic has a devastating effect because differential duty rates are applied? One of the easiest ways to handle the problem would be tax harmonisation between the two parts of the island of Ireland, which would remove the opportunity for smugglers to be involved in this trade.

My hon. Friend makes a strong point. We have considered this issue, and discussions have taken place on all the factors that affect organised crime in Northern Ireland. Fuel tax evasion is a crime in itself, irrespective of the tax regime, and should be vigorously opposed. I support my hon. Friend in saying that it is important that the whole of Northern Ireland society unites behind the police service and other organisations, including the Inland Revenue, to assist them in their efforts to bring to justice those involved in organised criminality, which includes those crimes that are difficult to tackle. The police can have an effect, and successes will continue so long as society unites to assist them in their efforts.

I agree with the Minister about the scale of the threat posed by organised crime. Would it not be better for the Government to redirect the tens or hundreds of millions of pounds from the scandalous gravy train that the Saville inquiry has become to the police, so that they can fight organised crime more effectively?

The police in Northern Ireland, Customs and Excise officers, the Inland Revenue and the other organisations in the taskforce are doing a superb job in tackling organised crime. The Government are not complacent. We are conscious of the scale of the problem, but the police have the resources, expertise and skill, and they are having successes. On the latter part of the hon. Gentleman's question, I refer him to the answer that my right hon. Friend gave a few moments ago.

Decommissioning

If he will make a statement about progress on decommissioning. [25593]

The Government are committed to seeing all illegally held weapons put permanently and verifiably beyond use. As the commission has reported, it will pursue its mandate, which is the decommissioning of all paramilitary arms.

I thank the Secretary of State for that response. Given that the Government have shamefully further appeased terrorists by allowing them another five years to decommission, and given that violence continues, will he accept that there needs to be far greater transparency in the decommissioning process to boost morale and confidence in the flagging peace process?

It is a bit of a tragedy that the Conservatives are reverting to type on this issue. There may be legitimate questions and arguments on all these issues, but to see every compromise necessary to put an end to the longest running dispute in British history as merely appeasement or a concession is to make cheap political points when we need statesmanship and leadership.

We want to see and will continue to press for the decommissioning of all paramilitary weapons, including those of the Irish Republican Army. The hon. Gentleman should not diminish the historic significance of the decommissioning that has already taken place.

On the methodology, it would be better to leave that to the integrity of General John de Chastelain, who operates under the statute, the remit and the modus operandi that were agreed by the House of Commons.

Accepting that the Unionist section of the community in Northern Ireland feels that various concessions, with which I agree, towards republican paramilitaries are a bridge too far, may I ask the Secretary of State what assurance he can give that he will take specific measures to build confidence in the Unionist community? He could, for example, provide an assurance that anybody who is on the run and has yet to be tried will not be given an unconditional amnesty, but will have to face a trial, whether or not they are subsequently released on licence.

The best assurance that can be given to any member of the Unionist community, which by definition has as its principal objective the union of Northern Ireland and the United Kingdom, is the democratic consensus, which is now accepted by everyone, and that the future constitutional status of Northern Ireland will be in the hands of the people of Northern Ireland. That is not a concession to Unionism but a democratic right. On the anomalies arising from the release of paramilitary prisoners, which we have pledged to resolve, when we have concrete proposals on that, we will of course bring them to the House.

Prime Minister

The Prime Minister was asked—

Engagements

Q1. [25657]

If he will list his official engagements for Wednesday 16 January.

This morning, I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further meetings later today.

My right hon. Friend knows that in Staffordshire we have some very good public services provided by dedicated public sector staff, but historically Staffordshire is one of the lowest-funded areas in Britain. We always appear at the bottom of any funding league table for education, health and the police. Will the Prime Minister give us hope that in future the funding formula will be open and transparent, that it will be fairer and that it will close the gap between areas that receive an average amount of funding and those at the bottom of the table? That will allow dedicated public sector staff to provide even better services for people in Tamworth and the rest of Staffordshire.

I can at least assure my hon. Friend that the review of the funding formula is intended to ensure that it is fairer. He will know that in Staffordshire, as elsewhere, additional resources have been going to education, health and the police. That means that education results have gone up, police numbers have gone up, waiting lists have gone up—[Laughter.] The number of nurses has gone up and waiting lists have gone down. As a result of that investment, services can improve. That contrasts with the position of the Conservative party, which with its proposal to cut public spending to 35 per cent. of GDP would take £60 billion out of our public services and decimate them.

When did the 10-year plan for transport begin—in December 1999 when the Deputy Prime Minister announced it, or on Monday when the Secretary of State for Transport, Local Government and the Regions announced it again?

The strategic plan in 1999 set out the overall level of money for investment, and the strategic plan announced on Monday showed how that money will be spent. [Laughter] I am sorry if the Conservatives cannot see the difference between the overall amount of money and how it is to be spent. We are in favour of investment, and that stands in contrast to their proposals to cut investment for transport.

That would make more sense if it were not for the fact that in the past two years the Government have announced the same policy five times and the same money at least four times. During that time, the Prime Minister and his team have both backed privatisation and renationalised the network, and he now wants to go cap in hand to private industry to get extra funding. Yet the figures show that throughout that period the delays on the railways had risen by 61 per cent. even before the strikes. That is 1,300 more delayed trains every single day. Will the Prime Minister tell us how much more it will cost him, as a result of that mismanagement, to get private money into the service?

First, let me correct the right hon. Gentleman on delays. Until Hatfield in October 2000, punctuality increased and there were more trains running. After Hatfield, when it became clear that the track infrastructure needed a total renewal, it is true that punctuality went down, as a result of decades of underinvestment. The difference between the Government and the Opposition is simply this; we are putting in some £33.5 billion of public investment in the next few years. Incidentally, £6 billion of private sector investment has already been committed and more will come. We are in favour of that investment going in. Is the right hon. Gentleman?

The Prime Minister may well be in favour of that investment going in, but the reality is that he will not get it put in. Private investors are now going to demand danger money for having anything to do with the Secretary of State for Transport, Local Government and the Regions after what he has done to Railtrack. A quick glance at the City will show that all those investors have now written investment in the Government down below investment in Mexico. They would not invest in the Government before investing in Mexico. As a result, they will now demand £1 billion extra to cover their risk. Does that not make the Transport Secretary the most expensive Cabinet Minister in history and should not the Prime Minister save the travelling public's money and sack him?

The right hon. Gentleman says that no money will come in from the private sector. I have just pointed out to him that £6 billion has already been pledged; the train operating companies have said that they will indeed put money in; and the director general of the CBI has welcomed the plan. The question that the right hon. Gentleman has to answer, but did not, is this: does he support public investment in the railways? It is almost a statement of the obvious to say when we look at the railways today that the problem is decades of underinvestment. The Government have a proposal to increase investment dramatically so that over the next few years investment at about three times the level will be going in. We are in favour of that investment; the right hon. Gentleman is in favour of taking it out. Whether in education, health or transport, we believe in investment; he does not.

My right hon. Friend will have seen stories and photographs in the press about the treatment of al-Qaeda prisoners by the United States. Does he share the concerns of many people in this country that the west is in danger of losing the high moral ground as a result of the treatment and possible mode of trial of those prisoners?

First, I hope that the whole House realises that there is still a situation of very great danger in Afghanistan for American troops, British troops and others; there are still pockets of resistance from the Taliban and, even as we speak, there are reports today of a fresh of cache arms being found, with a conspiracy to kill American troops, and no doubt British troops if they were in the vicinity. We are dealing with highly dangerous people.

Secondly, of course I totally agree that anybody who is captured by American troops, British troops or anyone else should be treated humanely in accordance with the Geneva convention and proper international norms. For that very reason, a British team will see those people claiming to be British citizens detained in Cuba; we will make sure that they are being properly and humanely treated. I simply say to my hon. Friend that we have been in discussions with the Americans, who assure us that those people are being humanely treated. They are getting fed properly and are being allowed to exercise and shower properly; they are being looked after properly with medical treatment; each is being given individually, should they wish, a copy of the Koran and the time to make their religious observances.

Rather than believing exactly what is reported in the media straight away, it is important that we get to the truth of the matter. The international Red Cross will go and see those individuals; British officials will see the people from Britain. There should be no doubt about two things. First, as I said, we are dealing with very dangerous people. Secondly, however, we are a civilised people and will treat prisoners in a proper and humane way.

Further to the question raised by the hon. Member for Hull, North (Mr. McNamara), given what we know already, will the Prime Minister make clear, where British citizens are concerned, his views on their being hooded, shackled, sedated and kept in cages?

Let us wait and see exactly how the prisoners have been treated. It is important not to say anything that prejudices their defence to the charges that have been made against them, but nobody should be in any doubt that the members of the al-Qaeda network are highly dangerous people. It would be unsurprising if they were subject to strict security measures, but of course they should be properly and humanely treated—in exactly the way that the Taliban would not treat their prisoners.

The entire House is united in wishing to see those responsible for the appalling atrocities of 11 September brought to justice, but will the Prime Minister recognise and stress to the Americans that if we are to maintain the global opinion which has been so successful in the fight against terrorism, we must demonstrate that our values remain above those of the people who seek to destroy them?

Of course, but with respect, the right hon. Gentleman should listen to what I have been saying over the past few minutes. Of course it is correct that we make sure that people are humanely treated. That is precisely why a British team will visit those who claim to be British citizens. The international Red Cross will see those people. We understand that they are being humanely treated, being given proper medical advice, food and allowances for their religion, and being allowed to shower and to exercise properly and so on. I repeat that it is important for us to get to the facts of how that group of people, 50 in number, is being treated, rather than simply reacting instantaneously to reports in the media.

Following my right hon. Friend's answer to my hon. Friend the Member for Hull, North (Mr. McNamara), what exactly is the justification for continued bombing of Afghanistan?

The justification is the very reason that I gave a few moments ago. There are still pockets of resistance by the Taliban. The discovery today, which is emerging now, of a conspiracy to kill American troops in and around a particular American camp, and the discovery of a large amount of weapons and ordnance, are an indication that the campaign is not over yet.

I can tell my hon. Friend that when I met the representatives of the new interim Government in Afghanistan, put together by the United Nations, they regarded the actions of American, British and allied troops in Afghanistan as a liberation of the people of Afghanistan. They believe that as a result of the defeat of the Taliban and their removal from government, people in Afghanistan have, for the first time in years, the prospect of a decent future. War is always a bloody and difficult business. We should carry it on until we have squeezed out the last remaining remnants of the Taliban. Then our task is also, as we will show at the Tokyo conference soon, to reconstruct Afghanistan and give it a proper future.

Q2. [25658]

In a week when eight-hour trolley waits have become a reality at the three-star Blackpool Victoria hospital, I draw the Prime Minister's attention to the remarks made by the Under-Secretary of State for Health, Lord Hunt, at a recent conference, when he said that the national health service has two years to win back public confidence, or other forms of funding will be considered. Does the Prime Minister agree with his Under-Secretary on the timing issue? Can he tell the House what are the other forms of funding that are under consideration?

First, in relation to the national health service, of course it is important that it wins back confidence, which is why the report from the modernisation board last week—which, incidentally, and contrary to what the Conservatives said, included representatives of the royal colleges, such as the Royal College of Nursing, and the British Medical Association—was clear that the NHS is making progress, and that most of the indicators are now moving the right way. Of course there will be big pressures over the winter, but there are more beds now, more nurses and more doctors, and the waiting lists are indeed coming down.

Secondly, in respect of alternative systems of funding, the right hon. Gentleman knows what we believe. We believe that, as is the case in Denmark, where I gather the shadow Health spokesman has been, the health service should be funded out of general taxation. The alternative is the proposal from the right hon. Gentleman's party, which would force people to pay and would cut public spending. Hon. Members can point their fingers as much as they like, but the proposal of the Conservative party is to cut public spending and to force people to pay. That is the difference between a party that believes in the national health service free at the point of use, and a Conservative party that would cut spending and charge people.

The Government have recognised the problems that British seaside resorts face owing to the decline of the domestic tourism industry, and the urgent need for regeneration. Can the Prime Minister therefore tell me what funding will be made available to regional development agencies so that they can implement the coastal strategies that they are currently drawing up to help to regenerate seaside resorts such as Morecambe?

I cannot give my hon. Friend off-hand the exact level of funding for Morecambe or indeed coastal resorts generally. She is right to say that the regional development agencies now have a specific remit to encourage economic development. In areas such as hers, that means the coastal resorts. Of course, additional finance is being put into tourism at the moment. I think that my hon. Friend will agree that it is necessary to ensure co-ordination on a regional basis and that it would be very unfortunate if we adopted the Opposition's proposals and abolished the regional development agencies.

Q3. [25659]

Is the Prime Minister aware that band D council tax payers in Suffolk will shortly be receiving bills of about £1,000—a staggering 60 per cent. increase since he took office? As my constituents reflect on the quality of services provided by the Labour-Liberal Democrat county council, may I ask him how he can reconcile his clear commitment not to raise taxation with this huge stealth tax increase for the people of Suffolk, which over five years has averaged no less than six times the rate of inflation?

In actual fact, we have put more money into the local authority settlements than the Government the hon. Gentleman supported ever did. Of course, that money is delivering better education for his constituents—he did not mention that—and better social care and services. It is precisely for that reason that we believe that it is important that this money carries on going into our public services. Of course, the hon. Gentleman believes in taking it out.

Q4. [25660]

Following this morning's highly successful launch of the anti-hunting campaign "Countdown to the Ban", will the Prime Minister confirm that the Government's pledge to enable Parliament to reach a conclusion on the issue still stands? Will he advise the House as to when we can expect a vote on a ban on hunting with dogs?

The commitment in our manifesto does indeed stand. We promised a free vote in the Queen's Speech. There has been no decision yet on the timing of the vote, but the Government will make an announcement at the appropriate time.

When the Health Secretary told NHS executives that he would

"come down like a ton of bricks on anyone who has anything to do with the private sector",

what did he mean by that?

The Health Secretary has announced a whole series of partnerships with the private sector. I should have thought that it is very sensible that where it is important to use the private sector, we do so, but nobody should be in any doubt that of course the purpose of that is to provide a better service within the national health service. That is quite different from what the right hon. Gentleman wants to do, which is force people to pay for their health treatment and privatise the national health service.

Yesterday, the Prime Minister and his Health Secretary apparently hated the private sector. Now it is clear that today they are turning to it in desperation. Who knows what they are going to do tomorrow? Almost anything, it seems. The Prime Minister should pay attention, because the Health Secretary told the House six months ago that there should be "one monopoly provider" of health care. He says now that the NHS should

"no longer be a monopoly provider of care".

Which is the correct statement of Government policy?

The statement is set out very clearly in the national health service plan: where we can work with the private sector, we will do so. The reform programme in the health service is delivering more beds and more nurses—some 27,000 more nurses. It is delivering real improvements both in waiting times and in waiting lists, which are down on those under the previous Government. It is also, for example, delivering changes in the way in which cancer patients are seen; more than 90 per cent. of them are now seen within two weeks. Cardiac waiting times are also improving. These are changes that are being delivered by a Government who believe in reform and investment. When I asked the right hon. Gentleman whether he supported the investment in the railways, he gave us no answer. Now let him get to his feet and tell us—it is very simple—so that we can have a proper debate: does he support the additional investment going into the health service or not? If he does, how does that lie with his commitment to reduce spending to 35 per cent. of GDP?

It is no good the Prime Minister asking me what I support when he does not know what his Government support. On health, as on everything else, they do not have a clue. The right hon. Gentleman forced school bullies to be kept in school, but now he wants them kicked out; he dispersed asylum seekers, but now he wants them all to be kept in the same place; he wanted a democratic House of Lords, but now he wants a House of cronies; he said that he wanted to renationalise the railways, but now he is begging for private money. Is this not a case of power without purpose, politics without principle and a Government without direction?

I suppose that, for the right hon. Gentleman, that passes for stinging rhetoric. He said that we did not know what we support for the health service. With respect, we do. We support the extra investment, which has reduced waiting lists and given us more nurses, doctors and beds. Those who work in the health service said last week that they were turning the corner and that it was getting better. We know the difference between the two political parties: we support investment and reform because both are important; the right hon. Gentleman does not support the extra investment. He wants to run down the health service so that he can say that everyone gets hopeless care on the NHS and he and his supporters can justify privatising it.

The difference is the same as it always has been. We created the health service—the Conservatives opposed it. We invest in the health service—they cut the investment. We want a health service that is free at the point of use—they would make people pay for it.

After the examples of Equitable Life, Railtrack and even Johnson Matthey, why should we hand over chunks of the health service to private sector managers? How will the whizzkids from the private sector transform the health service, especially when, as the Prime Minister rightly said, it is getting better under Labour?

Two groups of people will oppose our plans. My hon. Friend says that he opposes using the private sector, but I disagree with him. On the borders of my constituency, a new hospital has been built under the private finance initiative. That also applies to other facilities in my constituency. The PFI is improving health care within the NHS. The reform programme in the health service will continue because it is right; it will deliver better health care.

The other source of opposition is on the Conservative Benches. Conservative Members may be in favour of reform, but they are against investment. The new Labour Government have adopted the right position: yes to investment, and yes to reform because both will deliver a better national health service, not an old-fashioned health service, or a privatised system, which Conservative Members want.

Q5. [25661]

The Prime Minister is aware of my total support for the Unionist cause in Northern Ireland and for the role of our armed services in the campaign against terrorism worldwide. Will he therefore tell the House the cost of the Saville inquiry, not least because the Parachute Regiment which is currently engaged in operations in Afghanistan is involved? I understand that the cost exceeds £60 million. Can that figure be justified?

The cost of the inquiry is £52 million. The reason for the inquiry is that it was important to lay to rest some of the claims that have been made over many years. Public inquiries cost a lot of money; the BSE inquiry cost around £30 million. However, it was important in the context of the peace process in Northern Ireland that we made progress and held such an inquiry.

The hon. Gentleman and other Conservative Members have criticised the peace process, and I heard the attacks on my right hon. Friend the Secretary of State for Northern Ireland this afternoon. I hope that they also realise how much money and how many lives have been saved by the Northern Ireland peace process. Conservative Members may currently oppose it, but hundreds if not thousands of people are alive today who otherwise would not have been; there is investment in Northern Ireland that would never have been made and there are jobs that would never have existed without the peace process. Hope and prosperity are at least available to people in Northern Ireland. If we went back to the old days of the Conservative Government, both would be missing. [Interruption.]

Order. Before we proceed, I must ask the hon. Member for Isle of Wight (Mr. Turner) to be calm—very calm indeed.

I welcome the review of student finance that was announced recently. If there is to be any delay in making changes, will consideration be given to finding extra finance for students from poorer backgrounds, who are finding things very difficult at the moment?

It is important that we get the right balance of contributions from the individual and the state, and that is precisely what we are looking at at the moment. I hope that my hon. Friend will accept that, contrary to some of the things that were said a few years ago, the number of people going to university is up, not down. We must focus in particular on those people from poorer social backgrounds who perhaps do not get the chances that they need. I know that my hon. Friend would want me to point out that 50 per cent. of those who go to university do not pay tuition fees, as a result of the Government's changes.

Waste Refrigeration Equipment

Q6. [25662]

What action he has taken to co-ordinate the work of Government Departments in connection with the (a) disposal, (b) recycling and (c) re-use of refrigerators.

A number of Departments, including the Department for Environment, Food and Rural Affairs, the Department of Trade and Industry, the Cabinet Office and the Treasury, have been working closely together to devise the most efficient means of recycling old refrigerators, with the overall aim of reducing damage to the environment.

About time too. In 1998, the Government signed up to a directive about the disposal of fridges without understanding the implications of that directive. It was a further two years before they understood what they had agreed to. They then faffed around for some 18 months and failed to request a delay in implementing the directive. Will the Prime Minister tell me why we are in the ludicrous position of having 3 million fridges to dispose of, without having a single plant in the United Kingdom capable of doing the job? Who is going to pay for this fiasco? If ministerial responsibility is to mean anything—

Order. I call the Prime Minister.

It is not correct to say that no preparations have been made. Indeed, we have recently announced some £6 million-worth of extra funding—as the hon. Gentleman may know—precisely to help with the issue of recycling that he raises.

Engagements

Q7. [25663]

Is the Prime Minister aware that many people—I would say the majority of the British people—believe that his efforts and those of his Government on foreign and defence policy since 11 September are exemplary? May I seek an assurance from him that he and his Government will not lose sight of the fact that the treatment of the Palestinian people by Israel is perceived to lie at the heart of the problems of the Islamic world? Will he do everything in his power to ensure a peaceful and equitable solution to the problems in the middle east, based on United Nations resolutions?

We will certainly do what we can to assist the parties to make progress in the middle east. As I have said many times before, that must be based on two very secure principles. The first is a 100 per cent. effort by the Palestinian Authority to crack down on the violence and terrorism that are causing such destruction and misery in Israel, and—in my view—a guarantee from the Arab world about the security of the state of Israel. The second is a proper, viable Palestinian state in which Palestinians and Israelis can live side by side in justice together. We will certainly do all that we can to make progress on this issue.

Q8. [25664]

Many hundreds of my constituents working at Huntingdon Life Sciences, its shareholders and funders are being subjected to a massive campaign of intimidation from animal rights terrorists. Like other terrorists, they organise internationally and use extreme violence to further their views. Does the worldwide international fight against terrorism extend to Huntingdon and what does the Prime Minister intend to do to stop the violence against my constituents?

First, let me say to the hon. Gentleman that the violence against his constituents and against Huntingdon Life Sciences is totally and utterly beyond the pale. It is totally wrong. Those are criminal acts. For that very reason, we are tightening the law to ensure that we deal with these people in a more satisfactory and quicker way. Through the hon. Gentleman, I want to say to his constituents and to Huntingdon Life Sciences that one of the proud traditions of this country is that of scientific inquiry. People are perfectly entitled to their strong views on animal welfare, but it would be deeply regrettable if we lost any part of scientific endeavour in this country. The hon. Gentleman's constituents and that company will have our full support in making sure that the actions of these people do not succeed.

On a point of order, Mr. Speaker. The Prime Minister has just told the House that the cost of the Saville inquiry is £52 million. As he ought to know—the House has already been furnished with written answers—that is only the cost to the Northern Ireland Office. The cost is already more than £14.5 million to the Ministry of Defence and the estimate of costs to the Northern Ireland Office is £100 million. That does not include costs to other Departments such as that which pays Lord Saville's salary. What opportunity is there for the Prime Minister to return to the House to correct the record?

Why does not the hon. Gentleman try next Wednesday?

Travel Concessions (Young Persons)

3.32 pm

I beg to move,

That leave be given to bring in a Bill to permit local authorities to include persons at or under the age of 25 in travel concession schemes.

The city that I represent, Milton Keynes, has a young population and the highest number of under-25s per 1,000 people of any city in Europe. The figures for 2000 show that 75,000 of the 209,000 population are under 25 and that there are 24,000 young people aged between 17 and 24. Whenever I speak to them about what affects their lives, the issue that is always top of their list is transport, and more specifically, the cost of public transport and how that reduces their access to training, employment, leisure and other services.

Young people rely on public transport. A recent survey by Milton Keynes Community Foundation shows that whereas an average of only 43 per cent. of city residents use public transport, the figure increases to 57 per cent. for 16 to 24-year-olds. The national travel survey shows that 17 to 20-year-olds use buses twice as much as the rest of the population. They make 13 per cent. of all journeys by bus compared with only 6 per cent. for all ages. That reflects the absence of alternatives for most young people. Only 41 per cent. of 17 to 20-year-olds hold a driving licence compared with 71 per cent. of adults.

In relying on public transport, young people are very similar to the over-65s and, like pensioners, they tend to have lower incomes than other adults. Unlike pensioners, however, they are not offered travel concessions unless they fall into certain restricted groups.

The Transport Act 1985, which applies to local authorities in England outside London and to Scotland and Wales, allows councils to provide travel concessions for elderly people, the blind and the disabled, and children under 16 or those between 16 and 18 in full-time education. My Bill would amend the Transport Act to permit local authorities to provide concessions for under-25s so that all young people were covered, whether in full-time education or not. Similar changes would be required to the Greater London Authority Act 1999 to give the same powers to London boroughs.

My experiences talking to my young constituents in Milton Keynes have highlighted to me the barrier that is placed before them by the current cost of public transport. Of course there are some young people who are employed in well paid jobs, but I suspect that most of them will own a car and will be among the minority of young people who do not use public transport at all.

The majority of young people are on low incomes. The national minimum wage levels for 18 to 21-year-olds is only £3.50 an hour. Young people under 25 receive lower levels of housing benefit, income support and jobseeker's allowance. Wage levels in general are often lower for young people, reflecting their lack of experience. Students at further education colleges get little or no financial support, although I am pleased that this Government have begun to recognise the needs of this previously neglected group of students. Unemployed young people are in an even worse position. For all these young people, the cost of public transport is a major problem.

I am indebted to the YMCA, which works with young people across the country, for evidence that shows that the problems identified by my young constituents in Milton Keynes are shared by young people throughout the country. In 2001, the YMCA responded to the consultation by the social exclusion unit on "Transport and Social Exclusion". Questionnaires were sent out to all 160 local YMCAs, working in 230 communities. The responses from young people and youth workers showed the ways in which lack of affordable public transport affects the ability of young people to make the most of the opportunities available to them.

In Nottingham, a YMCA resident—a trained joiner and cabinet maker on jobseeker's allowance—is faced with fares of nearly £4 return to travel to job interviews in nearby Ilkeston. The YMCA had to lend him the money, but the youth workers have commented that they do not publicise the YMCA fund because demand would then exceed supply. Chester YMCA echoes the point that

"transport problems are the most common problem, from getting to youth projects through to inhibiting job seeking and studying."

In Romford, the YMCA often has to make up the shortfall in people's travel costs; otherwise they cannot travel to job interviews or training further afield.

A worker at Bishop's Stortford YMCA highlighted the additional problem of the penalty in fare costs of changing from one bus to another:

"If young people have to take several buses to sign on, or to get to an interview, that begins to get expensive."

Mendip YMCA in Wells drew attention to the problems in more rural areas where support services are widely based. Young people from Wells have to travel to Glastonbury or Frome—over an hour's bus journey—or even to Yeovil to obtain a crisis loan. In urban areas, the probation service, the benefit office and the Employment Service may all be on different bus routes.

If young people find employment, particularly if they are on the youth rate of national minimum wage, the added costs of travel can often more than cancel out the financial benefit of working. Romford YMCA often has to fund travelcards for young people on the new deal when they first start work, or they would be unable to afford transport to work. The lower rate of housing benefit for those under 25 means that they often cannot afford to live in the more expensive areas near their work or training, thus adding to transport costs.

A resident of Milton Keynes YMCA signed off benefits to work for the Post Office over Christmas but could not afford to pay transport costs before his wages were due at the end of December. He had to stop work and go back on benefits. Colchester YMCA highlighted the further education students who face costs of up to £15 a week to get to courses.

The examples collected by the YMCA mostly concern relatively disadvantaged groups of young people, but although the majority of young people may not face severe problems in transport to their education or training, most still find the cost of transport limits their access to sporting and leisure facilities. This has two worrying side effects. The first is that young people may be tempted to accept lifts from people they do not know, or to walk home alone late at night because they cannot pay the transport costs. The second is that young people, unable to afford the transport to city centre activities, tend to congregate aimlessly around suburban shopping centres, drifting into vandalism through boredom.

It has long been accepted that local councils should have the powers to offer travel concessions to pensioners, because access to affordable public transport is seen as crucial to allowing pensioners to lead full lives. Indeed the Transport Act 2000 gave elderly people an entitlement to a half-fare concession on local bus travel. As I pointed out earlier, young people are similar to pensioners in being very reliant on public transport, having low access to private cars and being on lower than average incomes. My Bill recognises that young people, too, need access to affordable public transport to lead full lives. By encouraging young people to use public transport we may also be helping the environment in which we all live, by building a habit that carries through into later life—the habit of using public transport more and the private car less.

I would ask hon. Members to think of the experiences of young people in their constituencies, and to listen to the views collected by the YMCA and echoed by young people all over the country. I ask hon. Members to support my Bill and help our young people to gain a greater freedom of movement and ability to lead fuller lives through access to affordable transport.

Question put and agreed to.

Bill ordered to be brought in by Dr. Phyllis Starkey, Charlotte Atkins, Richard Burden, Mrs. Anne Campbell, Vernon Coaker, Phil Hope, Helen Jackson, Mr. David Lammy, Margaret Moran, Mr. Martin Salter and Ms Claire Ward.

Travel Concessions (Young Persons)

Dr. Phyllis Starkey accordingly presented a Bill to permit local authorities to include persons at or under the age of 25 in travel concession schemes: And the same was read the First time; and ordered to be read a Second time on Friday 21 April, and to be printed [Bill 82].

Opposition Day

[7TH ALLOTTED DAY]

Railways

I have selected the amendment in the name of the Prime Minister.

3.42 pm

I beg to move,

That this House notes the failure of the Government to tackle adequately the growing crisis on British railways; and believes that the salary of the Secretary of State for Transport, Local Government and the Regions should be reduced by 1.8 per cent. and that payment of a further 22 per cent. be withheld until 31st March 2003.

I shall begin by agreeing with the Secretary of State that the state of British railways is, as he said, "unacceptable". With some justification, right hon. and hon. Members can point to the failure of past Governments to invest adequately in our railways as a possible cause. No doubt that was even true of past Liberal Governments. Past investment has, at times, been lamentable. With justification, many right hon. and hon. Members will also point to the problems of fragmentation caused by aspects of rail privatisation. Criticism may also be levelled, as it was by the head of the Strategic Rail Authority on Tuesday, at some of the management of our railways system—notwithstanding the excellent work done by many railway staff.

The Liberal Democrats accept that past underinvestment, privatisation and some poor management have all undoubtedly played a part in the current rail crisis. However, we have had a Labour Government for nearly five years and it is reasonable to question what they have done in that time to seek to rectify the problems of our railways. Have the Labour Government improved the situation or has it got worse? Public opinion is clear. The YouGov poll in The Mail on Sunday last weekend showed that 70 per cent. of people believe that the situation on our railways has got worse since Labour were elected in 1997.

I acknowledge that not all is bad; for example, there has been an increase in passenger numbers and in private investment in the railways, and the Strategic Rail Authority has been established. However, we also note that between 2000 and 2001 train delays increased by 70 per cent., meaning that, collectively, passengers wasted at least 4,600 years last year waiting for delayed trains. Cancellations increased by 45 per cent. in the same period. There is massive overcrowding—39 per cent. of rail journeys are overcrowded; as I pointed out yesterday, it is somewhat bizarre that the Government have introduced legislation to tackle the overcrowding of chickens but have taken no action to reduce the overcrowding of humans on trains.

The Government have said that they want our stations to be safer. They are right. Train use will not be encouraged if people have to wait in unlit, unstaffed stations at night, if information is inadequate, or if car parks are insecure. However, although the Government announced a secure station initiative in 1998, nothing was done. As a result, only about 120 of the 2,500 railway stations have so far achieved accreditation. At that rate, it will take a staggering 76 years before all stations are deemed safe.

What about affordability? Britain's railways are the most expensive in Europe—almost the most expensive in the world. In this country, passengers can travel, on average, 55 miles for £10. That compares with 128 miles in France and 806 miles in the Czech Republic for the same amount. Under the ridiculously complex fares structure through which passengers must wade, many of our fares are excessive; yet the Government have made no serious attempt to tackle that problem.

We need a safe, reliable and affordable railway system but we do not have one.

Does my hon. Friend agree that the Government need to get a grip because the problem affects our reputation abroad? It affects investment in this country and the perceptions of foreign business and our trading partners when they see a railway system that does not deliver. Does my hon. Friend agree that the sooner there is a safe and correct decision on the London underground and the sooner there is investment, commitment and action as regards the rail network, the sooner the City, the business community—the chambers of commerce and the CBI—will feel that they can go back to selling Britain abroad, as they want to do and as I hope the whole House wants them to do?

I entirely agree with my hon. Friend. Despite our criticisms of the current state of the railways, I hope that all hon. Members want our railways to succeed for the very reasons given by my hon. Friend. I certainly agree that not only must we have a quick decision from the Secretary of State on the London underground but it must be the right decision. I very much welcome the suggestion made today by the right hon. Gentleman that he may be more prepared than heretofore to consider alternative proposals—including the one first made by the Liberal Democrats—for a bond issue arrangement for the London underground.

I am sure all hon. Members in the Chamber want the railways to succeed, but would that be helped if passengers took the advice of the hon. Member for Winchester (Mr. Oaten)? On Meridian television, on Sunday at lunchtime, the hon. Gentleman advised people to break the law by refusing to show their tickets to railway staff. Is it right to incite passengers to break the law and to take out their frustration on the hard-working staff of the railways?

The hon. Gentleman will be aware that the legal requirement is to have a valid ticket for travel. He will also be aware that many rail passengers are extremely fed up with the current state of our railways and the Government's failure to tackle it. I suspect that on 1 March many of them will find some way—whether through the suggestion of my hon. Friend or in some other way—to make known their concern about the current crisis and to put pressure on the Government. I note with interest and some pleasure that later today the Secretary of State is to meet some representatives of the passengers who are so deeply worried about the situation on the railways.

Will the hon. Gentleman give way on that point?

I will a little later, but I want to make some progress.

As the Secretary of State said just two days ago in the House, we do not have a railway system that is fit for the 21st century. I welcome the right hon. Gentleman's candour then, and the candour that he showed earlier today when he was asked why Lord Birt had been brought in to advise on the railways. The right hon. Gentleman's succinct reply—that it keeps him occupied—betrays a great deal.

Even more forthright than the Secretary of State was the Minister for Europe, who told The Spectator magazine that we had the worst railways in Europe. Rail passengers are only too well aware of the problems of delays, cancellations, overcrowding and excessive fares. No wonder they are lobbying the Secretary of State later today.

Sadly, however, some information about the state of our railways is being denied to passengers. The Government seem unwilling to provide some very important facts. Just before Christmas, I submitted some 200 parliamentary questions about the state of the railways. The House may be interested in some of the replies.

I asked, for example, about collisions involving mark 1 rolling stock—the slam-door carriages. The Department answered by suggesting that the information was not available, yet I assure the Secretary of State that it can be found on page 94 of the Health and Safety Executive's annual safety report. The data show that, of the 106 train collisions that occurred in 2000–01, 58 were due to trains colliding with the open door on a slam-door carriage.

I also asked for a regional breakdown of speed restrictions, but the Department again felt unable to oblige. However, discussions with the train operating companies, and the data that they have supplied, mean that we know that the information is available.

I asked also for details of the proportion of track that does not meet minimum required standards. I was told that the information was not available to that level of detail. That was an odd response, as the information can be found in Railtrack's network management statement.

Many of my questions referred to safety improvements. I am sure the Secretary of State would agree that restoring confidence in the safety of our railways is crucial. Safety recommendations must be implemented swiftly and the public must be kept informed of progress on implementation.

Does the hon. Gentleman share the concern of many people in south Wales about the reports that emerged over Christmas and the new year regarding the condition of the track bed on the line between London, Swansea and Cardiff, which is subsiding? Does he share my concern, with regard to safety, that the Strategic Rail Authority's plan, published this week, makes no mention of any work being done on the line in the next 10 years? We will have to wait half a century before that line is upgraded.

I agree, and the same applies in the south-west of England. Cornwall has been given objective 1 status by the Department, yet it does not enjoy a similar status when it comes to improvements in rail facilities.

With regard to safety, last week I met Chris Gibb, chief executive of Wales and West Passenger Trains. The meeting had been planned before Christmas, and we discussed the line that runs from Manchester, through Shropshire and Herefordshire, and down to Cardiff. He told me that when he lays on extra trains for rugby international matches at the Millennium stadium in Cardiff, he has to borrow coaches from a museum, as he has so little in the way of resources or infrastructure. Does my hon. Friend think that that is a safe way for passengers to travel to a rugby match?

I suspect that my hon. Friend will not be surprised to hear that I do not believe that that is the right way to go forward. I am sure the Secretary of State will have heard what my hon. Friend said, and I hope that he will respond later.

Will the hon. Gentleman give way?

No; I want to make progress because many other hon. Members wish to speak.

The point is that safety recommendations need to be implemented swiftly. Following the dreadful Paddington crash, Lord Cullen made very many safety recommendations, 41 of which were due to be implemented before Christmas, by 19 December. When Lord Cullen published his report on 19 June, he recommended that a review of compliance with his recommendations should be conducted on behalf of the Health and Safety Commission within six months of his report, and that those reports should be published.

On the same day, the Secretary of State said that he wanted a report on implementation by 19 December. Despite asking questions about those 41 Cullen recommendations, we still do not know whether they have been implemented, yet I have received a letter from the Under-Secretary of State for Transport, Local Government and the Regions, the hon. Member for Southampton, Test (Dr. Whitehead), that states:

"The review of compliance has been completed."

It goes on to say that checks on "areas of uncertainty" are being made and that the report will be published next March. That is simply not good enough; any accurate information on this crucial issue should be published immediately.

Yesterday, I incorrectly stated that the information was on the Secretary of State's desk. He has assured me that it is not, so I unreservedly apologise to him, but that raises a fascinating question: given that he wanted that report by 19 December and that the review of compliance has been completed, why is it not on the Secretary of State's desk? Why does he not demand that it be put on his desk immediately? Why does he not agree to publish the accurate information that it contains straight away?

For the simple reason that, as the hon. Gentleman will know, the Health and Safety Executive is an independent body. At the moment, it is clarifying some of the reports that it received from the industry with regard to compliance by 19 December. It will report to the Health and Safety Commission in February, and I will receive a report after that. That is the sequence of events, and I am afraid that it is the price we pay for having an independent HSE that is not dictated to by party politicians.

If the HSE is not dictated to by party politicians, it is slightly odd that the Secretary of State said in his press release on 19 June that he wanted that report by 19 December, and I hope that he will take that up with the HSE.

I hope that the Secretary of State will be prepared to intervene one more time. One of Lord Cullen's key recommendations was that signal improvements in the Paddington area should take place by 19 December. Does the Secretary of State know whether those improvements have taken place? Clearly, he has nothing to say. The travelling public will note that he could have obtained that information and asked for an answer to that specific question, yet it appears that he has failed to do so. That is typical of so much of what has happened under this Labour Government. The Minister for Europe also said in that article in The Spectator:

"We started transport investment far too late … We should have been more radical earlier."

I hope that the hon. Gentleman will agree that investment is key and that people judge politicians not on what they say, but on what they do. Will he remind the House of how much additional money, above and beyond the Government's public expenditure plans, was included in the Liberal Democrat's alternative budget last year?

Yes, I certainly can, and I shall come to that very point—[Interruption]. The answer is £250,000—[Interruption.] A figure of £250 million was included in the Liberal Democrats' alternative budget, but given that the hon. Gentleman is interested—

Will the hon. Gentleman give way?

No, I will not give way; I am still answering the hon. Gentleman's first question. As the hon. Gentleman is interested in government investment in the railways, I hope that he will do me the courtesy of waiting a couple of minutes before I tell him precisely what the Labour Government have invested in the railways.

Does the hon. Gentleman agree that an additional £250 million in the context of an additional £33 billion is technically called "peanuts"?

The hon. Gentleman is not comparing like with like. First, he has multiplied his Government's figure by 10 and compared it with a single year's figure. Secondly, in his comparison, he is referring not only to Government money but to expected and anticipated private sector money. If the chaos on the railways continues at its current level, there is fat chance that the Government will get the private sector investment that they expect.

rose—

Although I wish to make progress, I shall give way to the hon. Gentleman.

With an interesting statistic earlier, the hon. Gentleman spoke about the travelling public's aggregate waiting time for trains. With the aid of a ballpoint pen and the Order Paper, I have worked out that, since 1 May 1997, the electorate of the United Kingdom have waited an aggregate of 200 million years for a clear exposition of how the Liberal Democrats will finance their transport policies, and of where the taxes will fall.

If the hon. Gentleman wants clear exposition, I will be more than happy to provide him with a copy not only of the Liberal Democrat manifesto—which was the only manifesto to contain full costings—but of the very detailed alternative Budget that we set out. It contains all those details. He need wait no longer; they will shortly be coming his way.

rose—

I shall not give way, as I wish to make progress.

The real question is whether the Labour Government have made progress in solving the problem on our railways. I suggest that one reason why they have not made progress is that they have schizophrenia about the whole issue of privatisation. The House will be well aware that, when the Labour party was in opposition, it opposed rail privatisation. However, within two years of coming into power, it published the fascinating document "Releasing the Power of Rail", which offered a rather different view of privatisation.

I have referred to the document before, but it certainly deserves a second outing because it contains what a Labour Government said about railway privatisation. It states:

"Railways are back … Trains are cleaner, safer and often a good deal faster … There is, as a result of privatisation, new energy and enthusiasm in the industry."

Despite what the Government now say about fragmentation, the document even boasted:

"There are now 25 operating companies, instead of just one."

It concluded with this wonderful sentence:

"The arrival of competition has produced a surge of talent and innovation."

With such confidence in the system, it is hardly surprising that so little action was taken to get to grips with the problem.

The hon. Member for Harlow (Mr. Rammell) raised the issue of money. On Monday, I asked the Secretary of State whether it was true that the Government will have spent less on the railways in their first five years than the Conservative Government spent in their last five years. He gave me a perfectly correct figure about total investment—public and private combined—over a 10-year period and, as I said earlier, I accept that there has been increased private sector finance. However, he failed to answer my question.

I will therefore answer the question for the Secretary of State from figures provided by the Library of the House of Commons. In the first five years of the Labour Government, total Government spending on the railways will have been £8.2 billion. In the last five years of the Conservative Government, total Government spending on railways was £13.3 billion. On the crucial issue of investment in the railways, the disparity is even more marked. In their first five years, the Labour Government will have spent £0.7 billion on investment whereas, in their last five years, the Conservatives spent not £0.7 billion but £5.7 billion. Little has been done. Despite the high-level meetings that the Deputy Prime Minister had when he was in charge of the railways, he did little and achieved little.

Then we had a new Secretary of State. Was he going to do anything? Initially, his departmental press release of 18 June, headed "Government Pledges Certainty to allow the Industry to tackle the tough job ahead on our railways", quotes him as saying:

"So I am not going to embark on big structural changes. What the industry needs now is a period of stability and certainty".

That was before his famous U-turn when he took action on Railtrack. We agree with the direction that the right hon. Gentleman wants to take on that. After all, it was a Liberal Democrat proposal of many months earlier. The point is, however, that the way the right hon. Gentleman handled that process has led to further confusion in our railways and worsened the situation.

Has the hon. Gentleman also noticed that as recently as this week the SRA—the creature of the Secretary of State—praised privatisation for the 34 per cent. increase in passenger numbers and the 40 per cent. increase in freight achieved since privatisation? Even the Secretary of State is muddled over whether it is a good or bad thing.

I think that many right hon. and hon. Members are confused about the Labour Government's view of privatisation. On Monday, the Secretary of State said that the third way is fraying at the edges and that the private sector was not necessarily the best way forward. The next day he supported the SRA, advocating the continuation of privatisation through the use of private sector money. We also heard the Secretary of State for Health talk about the privatisation of the national health service. I am as confused as the right hon. Gentleman about the Government's approach to privatisation.

Will the hon. Gentleman give way?

No, I want to make a bit more progress.

We have also seen the SRA's strategic rail plan, to which the right hon. Member for Wokingham (Mr. Redwood) referred. I welcome it, although I would argue strongly that it has come far too late. Unfortunately, it contains much that is not new. Plans to introduce train protection warning systems have already been announced, as was the decision to buy new rolling stock to replace slam-door carriages.

The plan has little detail on reducing fragmentation, excessive fares or overcrowding. Indeed, in the light of the earlier 10-year plan, the Government seem to be rowing back on some of their aspirations. On excessive fares, the 10-year plan says:

"Punctuality, reliability, affordability and comfort are what most passengers want from their trains. We will seek real reductions in the cost of rail travel".

The SRA plan simply says:

"We must focus on performance and reliability, the key issues that passengers say time and time again. The SRA will be carrying out a review of fares policy."

I hope that affordability does not drop off the agenda and that a wider range of fares will be regulated.

Does the hon. Gentleman agree that one of the many defects in the 10-year plan released this week is that it has little to say about journey times and rail services in the far south-west? In particular, will he and his hon. Friends get behind the excellent campaign, now spearheaded by the Plymouth Evening Herald, to reduce the average journey times of trains to Plymouth to three hours? Does he agree that in the 21st century it is a disgrace that journey times from London to Plymouth are consistently around the four-hour mark? Will he back a three-hour campaign?

I am delighted to give the hon. Gentleman the opportunity to guarantee him coverage in the next edition of his local newspaper. He has heard me say that rail transportation from Paddington to the south-west and to south Wales is totally inadequate. Unfortunately, it seems to be slipping further and further down the Government's list of aspirations with regard to the things they want improved.

Will the hon. Gentleman give way?

No—no more.

Under the Labour Government, we have had far too many false dawns. What are the successes of the national punctuality taskforce that was set up at the insistence of the Deputy Prime Minister in February 1999? What has happened to the train reliability action groups that the Government set up? How many different dates have we been given for getting back to normal? What happened to that fresh start for the railways promised by the Deputy Prime Minister in April last year?

Now the Secretary of State expects us to draw a line in the sand, but before doing so and moving forward to what we all hope will be a better and brighter future for our railways, let us not forget the five wasted years of Labour Government. The right hon. Gentleman wants to be held to account by the next election, but he must also be held to account for his and his Government's inaction to date. The Government are keen on performance-related pay, so with 22 per cent. of trains delayed, we should delay paying that proportion of the right hon. Gentleman's ministerial salary; with 1.8 per cent. of trains cancelled, we should cancel that proportion of his salary. Unless there are significant improvements on our railways before long, the Secretary of State's mother may defend him, but no one else will, and nor should they.

4.11 pm

I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof:

"believes that the railway infrastructure was badly damaged by decades of underinvestment and a flawed privatisation; recognises that the Government made tough decisions in the first two years of the last Parliament to deliver the economic stability that means it can put record levels of investment into the railways; notes that annual average total investment in rail over the 10 year plan will be £4.3 billion, compared to £1.4 billion for the period 1989/90–1996/97; congratulates the Government on its decisive action over Railtrack, so undoing a failed Conservative privatisation; welcomes the SRA's Strategic Plan that sets out an effective agenda for the railways; calls for the resolution of the present industrial disputes through negotiation not strike action; and believes that the steps taken have laid the groundwork for a railway system that will be fit for the 21st century.".

I congratulate the hon. Member for Bath (Mr. Foster) on introducing this timely debate on the state of our railways. I agree with him—in part because he was quoting me—that we do not have a railway system fit for the 21st century. That is despite the fact that many dedicated, highly motivated people work in the railway system. They are frustrated that they are not working in an organisation that is delivering for the travelling public. It is important that we acknowledge the good work being done by many people in the industry.

As I said in Monday's statement on the strategic plan, there are two principal reasons why we do not have a railway system fit for the 21st century. First, for decades now there has been chronic underinvestment in the railway system. The grand schemes of the 1950s and 1960s of modernisation being achieved through British Rail led us to the 1970s and 1980s when, to be frank, there was political disinterest in the railways. No real priority was given to the subject by Governments, both Labour and Conservative, during that period. In the 1990s, the railways were used to push forward privatisation, first with the train operating companies and then, later in the 1990s, with the privatisation of Railtrack.

I have British Rail's 1980 annual report in which the then chairman, Sir Peter Parker, said:

"Planned limits on railway investment have remained virtually unchanged for nearly 10 years … If a rising profile of investment is not agreed, and desperately soon, much improvement in service quality … will be long delayed."

Does my right hon. Friend agree that the current calls for long-term investment should have been considered in 1980, when the Tories had the opportunity to invest?

The record will show that I made it clear that both Labour and Conservative Governments did not invest during the 1970s and 1980s. At the time, many of us in the Labour party argued against the public expenditure cuts that were being made—that takes me back a few years. None the less, my hon. Friend makes an important point about the need to invest in public services.

The 10-year plan launched by my right hon. Friend the Prime Minister set out for the first time a framework in which not only railways but transport overall could develop and expand in future. We now need to respond to the extra demand within the system. More passengers are being carried and freight has increased significantly in recent years, but the system has not been able to cope with that increased demand. We must now ensure that we can meet the demand that has been created, and that we can achieve the increase that we want to see, which is one of our key targets in the 10-year plan.

We were meant to have a plan at the end of 1999. A plan was launched in the summer of 2000, and another was launched on Monday, which was thin gruel with a few spin doctors' scraps in it. That so-called plan says:

"We need one plan"

and achieving that

"is a key target for 2002".

Even the plan is delayed. When will we get the real plan?

When the right hon. Gentleman has studied the plan, I hope that he will agree with me that it provides a comprehensive statement of exactly what benefits and improvements the travelling public can expect. Some people are critical because they do not think that the timetable is quick enough, and others ask questions about priorities. People may criticise, but for the first time the stall has been set out and people will be able to judge delivery.

The important point made in the plan is that this is not the end—it is not just the plan and that is it—it is a beginning, and there will be another plan next year, because it will need to be revised and reviewed in the light of experience. That is how it must be. It would be a terrible mistake if we thought that the plan was set in concrete and could not be changed in the future. The strategic plan was clear about what needs to be done.

The first reason for the under-performance in the railways is the chronic underinvestment over many years.

The Secretary of State has outlined past experience in the railways and the problems created by the chronic underinvestment, and I think that everyone agrees with him on that. Will he now put his mind to the chronic underinvestment in Wales in the next 10 years under this plan? Does he accept the figures produced by the Wales Transport Research Centre at the University of Glamorgan under Professor Stuart Cole, which show that the plan has only 17 per cent. of what the railways in Wales need for the next 10 years?

Is not the Secretary of State concerned that he could be storing up problems for the future in Wales by continuing the underinvestment under this plan, and that he could have the same problems as the Government had with the health service, when they addressed the problem of numbers on the waiting lists? They should be addressing the crucial infrastructure issue, rather than the number of passengers travelling in and out of London. Does the right hon. Gentleman accept the huge underinvestment in his plan for Wales?

No, I do not accept that there is an underinvestment in Wales. The strategic plan shows that, for the first time, the Strategic Rail Authority, working with the United Kingdom Government and the Welsh Assembly, is identifying what needs to be done with regard to rail provision in Wales. We will open up the Vale of Glamorgan line for passenger traffic between Barry and Bridgend, which is a real improvement. Early next year, we will have a new franchise for Wales and the borders, which will significantly drive up and improve standards in Wales, and overcome some of the difficulties that we have heard about from Opposition Members. That is a significant move forward. I welcome the close working relationship that has already developed between the Strategic Rail Authority and the Welsh Assembly. Engaging in a proper and effective dialogue is the best way to address the concerns of the people of Wales.

rose—

I shall give way to my hon. Friend the Member for Don Valley (Caroline Flint).

Does my right hon. Friend agree that the Government have a role in driving the pace of change through the franchising process? I am sure that, like me, he welcomes the agreed two-year extension to the Great North Eastern Railway east coast main line franchise, which has resulted in 11 extra services running from Leeds to London. GNER will refurbish every train in the fleet and rebuild every locomotive. Is not that good news for the travelling public and for those of us who are taking action on the franchising process to make the private operators put in the required investment?

When hon. Members have the opportunity to see the details of today's two-year franchise extension for GNER, they will realise that it will have real benefits for the travelling public. Most importantly, they will understand why there was a need to introduce a two-year extension at this time.

Will the Secretary of State give way?

I want first to make the point about GNER because it is of concern to many Members. The extension is for two years because the detailed work to upgrade the east coast main line was not carried out by Railtrack. That work can now be done. When we come to re-let the franchise after the two-year extension, we will be able to consider awarding a five, 10 or 15-year extension for the franchise on that line. The nature of the upgrade will mean that the franchise lends itself to such a lengthy extension.

rose—

I have a wonderful trio of Members to choose from. I will stick with Wales and the borders for the time being and give way to the hon. Member for Montgomeryshire (Lembit Öpik).

I acknowledge that there is significant investment for parts of Wales, but will the Secretary of State make a commitment to reconsider the plans for the more rural parts of Wales, particularly mid-Wales, which have not received the degree of attention that he implies they should have done?

I shall draw the hon. Gentleman's comments to the attention of the Strategic Rail Authority, as I know that it is considering how it can respond to the needs of particular communities.

Does not the extension to the GNER franchise mean that the Secretary of State has reneged on the commitment that he made in July to replace the existing rolling stock on the east coast main line? Is not that another indication that the 10-year plan is really a solution for London and the south-east? Does the right hon. Gentleman agree that there is a growing perception that it offers very little for Scotland?

The agreement announced today offers real benefits to people in Scotland. For example, there will be an extra carriage on each of the high-speed trains. My announcement last summer was basically a negotiating position aimed at finding out what the Strategic Rail Authority could secure from GNER. We never believed that all those objectives would be achieved. People will recognise the benefits that the changes will bring to passengers on the east coast main line and travellers to Scotland.

rose—

Hon. Members are trying to divert me to Scotland. I shall visit the south-west in due course, but I shall go via Hereford.

The Secretary of State knows that he will be very welcome in Hereford whenever he wants to visit. Returning to Wales and the borders, the current owners of the franchise there told me that because they will not know for another 12 or 15 months whether they will be successful in retaining the franchise, they will not make any significant investment at all, which is understandable. Is there not a need for longer franchises to give a period of stability so that companies can invest as they should be doing?

When the hon. Gentleman has the opportunity to read the new franchising statement from the Strategic Rail Authority he will see that it is considering a 15-year franchise, broken into three parts so that it is reviewed after five years. To be frank, I am concerned about what the position would be if, after five years of an extended franchise of 15 or 20 years, the company was clearly under-performing on its contract. It is important that we have break clauses in such franchises, and that is the direction in which the Strategic Rail Authority wants to go.

rose—

I shall make a quick visit to Scotland and then I shall go to the south-west.

Does the Secretary of State accept that his need to pursue private finance means that there is a danger that the money will go where the people are, as those are the areas in which private investors will be interested? Surely with a not-for-profit Railtrack he has a responsibility to invest in the infrastructure in areas such as the north of Scotland to ensure that businesses and people have choice and access to markets. Those areas should not be entirely dependent on their ability to attract private finance. Is the right hon. Gentleman aware that people on the Aberdeen to Inverness line are saying that they will no longer travel by train, not because the trains are not frequent enough but because they are so overcrowded that passengers cannot get on?

The hon. Gentleman makes an important point. There will be parts of the rail network where the private sector is keen to be involved, but we should never forget that the network is for the whole country and there is public service provision in the railways. Some lines are not economic, but it will be a disaster for the network if we close them down to save money in the short term, because in the long term that will deny passengers to the main lines. We must not make that mistake. We know from the way in which the rail network has been misused over the years that easy decisions can be made, but in the end some lines will not be cost-effective and they will need a public subsidy. The 10-year plan contains scope for the public sector to make provision to secure those routes.

Before my right hon. Friend leaves Scotland, there is a special problem which is something of a nightmare—the key Forth rail bridge, the greatest monument to 19th century engineering, with which there are expensive maintenance problems. I am not asking my right hon. Friend for an answer off the top of his head, but could he get his officials to look at where the boundary for responsibility lies between the Scottish Executive in Edinburgh and his Department? There are urgent matters and it may be a question of a stitch in time saving nine.

My hon. Friend makes an important point. Yesterday I had a meeting with the Scottish Minister for Transport and we looked at a range of issues to do with rail in Scotland. I am acutely aware of the need to make sure that the bridge is maintained safely and securely. Probably the best thing would be for me to do some detailed work and write to my hon. Friend so that he is fully aware of exactly what is being done.

I am impressed by the Secretary of State's detailed knowledge of rail services in Wales, Scotland and all round the country, which is very much to his credit. However, will he turn his attention to the people living west of Exeter in the far south-west? Does he understand the dismay that there is literally nothing in the 10-year plan to encourage anyone living in Devon, Plymouth or Cornwall that unacceptable journey times will be speeded up during the next 10 years? Will he give hope to regular rail users and business people in the far south-west that during the course of the 10-year plan something will be done to speed up the time that it takes to travel west from Exeter so that we can have a three-hour journey from London to Plymouth and down into Cornwall? The situation is serious.

In an effort to join the hon. Gentleman on the front page of his local newspaper, I had the opportunity to speak with the editor of the Plymouth Evening Herald at a reception at No. 10 Downing street last week. He pointed out the importance of the rail link between Plymouth and Paddington, so I am acutely aware of the problem. Improved frequencies are mentioned in the strategic plan, but I accept the hon. Gentleman's point that journey times are important; I am sure that the SRA will want to consider that.

Will the Secretary of State give way?

I want to make progress, but Cornwall is in the right direction.

To enable the Evening Herald to represent the views of the three parties, I point out that the Secretary of State has just touched on one of the major issues that we face in the south-west. He referred to the journey time to Plymouth, but there is a world beyond Plymouth; people do not realise just how far Penzance is beyond Plymouth. It is extremely important to recognise that we have a national railway system, to which he referred in the context of Scotland. If he does not represent the public interests of the more peripheral parts of the United Kingdom, nobody else will. The private investor never will.

When I was appointed Secretary of State, there was criticism of the fact that a non-driver had been appointed. However, when we have a debate such as this, it is useful to have a non-driver at the Dispatch Box. I have taken the train on most of those routes and I am aware that there are many miles the other side of Plymouth. There is a great need to make sure that Cornwall and many other counties in the south-west are effectively served by rail. The point is well made. I re-emphasise the fact that we are talking about a railway network. Of course, 70 per cent. of passenger journeys are in London and the south-east and there needs to be a concentration of resources to solve problems there, but not at the expense of other parts of the United Kingdom. The important thing is that the additional money that we have secured means that there will be funds to make improvements in those areas and ensure that we can discharge our responsibilities in London and the south-east where the bulk of passenger journeys takes place.

I was explaining that there were two principal reasons why the railway system was failing; the first was underinvestment and the second related to the failure of Rai1track. The House has debated that on many occasions, so I shall not go into great detail now. I just want to say something about the money that we are committing, as that was raised by the hon. Member for Bath (Mr. Foster). In the next 10 years, £33.5 billion of public money will go into the railways. I gave evidence to the Select Committee on Transport, Local Government and the Regions and know that there is concern. I was told that it was good to have that money going in, but I was asked whether I could ensure that there was not large-scale underspending in the Department, which would prevent money from being spent on transport and railways.

As the Select Committee heard this morning, at the end of March 2001 there was an underspend on capital of £350 million for that financial year—an underspend which is unacceptably high. As Secretary of State, I have tried to make sure that our capital programme is forecast correctly and spent on schedule. We are taking significant steps to achieve that. It was to make sure that we do not have a large underspend at the end of the present financial year, that on 28 November I wrote to all budget holders of capital spending in the Department and in our agencies. I shall quote from the letter, as it shows how seriously I as Secretary of State take the issue of making sure that we spend the money that has been allocated.

The letter stated:

"As a Department, we are responsible for a large proportion of the Government's capital investment programme.… I am therefore concerned to ensure that we should be doing all we can to keep underspending to a minimum, consistent with value for money. I am, of course, aware that there is always a risk of slippage, particularly for large and complex capital programmes, and that there are other constraints relating to capital programmes. However, I attach great importance to ensuring that, with good management and forecasting, slippage should be kept to an absolute minimum. Where investment in one project is slipping, to compensate you should consider advancing spend on other committed projects."

That is necessary to make sure that money that is allocated is spent when it is needed. The measures that we have introduced in the Department will make sure that we overcome a large degree of underspending, while still achieving value for money.

One of the areas where the underspend was greatest was on the channel tunnel. Can the Secretary of State give me an assurance that the problems that freight trains have had getting through the tunnel because of asylum seekers will be ended, and that the underspend will not occur again?

The underspend on the channel tunnel did not arise for that reason, but because there was no slippage. Delivery came in below the amount of money that had been allocated. That was good management. The project is going extremely well. It is on budget and on time.

The entire House agrees that we cannot allow people to enter our country illegally through the channel tunnel. We take a robust position on that. We have a good relationship and we have reached a satisfactory conclusion with the French in respect of Eurostar. We have effectively closed that route. We are putting great pressure on the French to adopt robust physical measures, such as fencing and proper lighting, and to ensure a police presence to deal with the problems of freight. Those issues must be addressed in a way that does not disadvantage the British freight business. We are urging the French to move. The Government are aware of the seriousness of the problem, and we will do all that we can to overcome it.

The hon. Member for Bath mentioned the spend under the previous Labour Government from 1997 onwards. We must acknowledge that in the first two years of that period, public spending was restricted to the programme laid down by the Conservative Government. It was not an easy decision to take. I was Chief Secretary to the Treasury for part of that time, so I bear some of the responsibility. I shall explain to the House why we adopted that approach.

When we came into office in 1997, the national debt stood at £350 billion. That was 44 per cent. of our gross domestic product and was costing £25 billion a year in debt repayments. National debt was not falling, but going up. In 2001–02, because of the measures that we introduced and the tough spending round for those first two years, debt will fall to about 31 per cent. of GDP, costing £18 billion a year to service, so already we have £7 billion a year extra for essential services—money which is not being spent on servicing the debt because the national debt has been reduced.

That was not an easy decision to take in those first two years, but the tough regime that we introduced ensured that, at a time when we were getting the economy right and it was growing, we could use the money to start to repay the national debt. As I said, the regime ensured that £7 billion a year extra is now available for investment in transport, health, education and so on. In addition, we reduced not only the national debt, but unemployment. The number of people in work has increased by 1 million since April 1997. As a result, we are now spending £4 billion a year less on unemployment.

So, those tough decisions that were taken early on have provided us with about £11 billion a year extra that we can spend on essential services, and we obviously have the benefits of the growing economy as well. Those are the reasons why we took those decisions. The Liberal Democrats can criticise us for that and complain about the spending levels that resulted, but because of the steps that we have taken we can deliver through the 10-year plan long-term, sustained investment in the railway network. The railways, perhaps more than any other area, need not merely the odd one or two years of investment, but a long period, and 10 years will make a marked difference to the railway infrastructure.

I note with interest that the Secretary of State has not denied the proposition that I put to him on spending. I said that the Labour Government had spent less in real terms on the railways in their first five years in office than had been spent in the previous five years, during which a Conservative Government were in power. The right hon. Gentleman is now seeking to give the House the impression that there is to be a huge bonanza in additional Government money for the railways. Will he confirm whether my figures are correct, not least in view of the merriment about the additional £250 million a year proposed by the Liberal Democrats? Will he confirm the Library figures? On a 1999–2000 price base, they show that, in the last eight years under the Conservative Government, the total annual Government spend on the railways was £2.4 billion a year, while the figures in the 10-year plan suggest that that will rise to a staggering £2.5 billion—an increase of only £100 million a year.

The figures are clearly set out in the plan. The important point is that somebody travelling on the train will not be bothered too much about whether public or private money has been used to buy, for example, the rolling stock. People will want to know only that the train is in decent condition, that it will get to the destination on time and that it is safe. Such a division does not make sense in the real world. Surely, the key issue is the total investment that is being made in the railways, not whether it is public or private. A big increase is occurring in terms of public investment and I am confident that we will secure the private investment that will be necessary to support the railway network.

rose—

I have a great choice. I give way first to the hon. Member for Brentwood and Ongar (Mr. Pickles).

I am most grateful to the Secretary of State. We generally agree that it does not matter where the money comes from, but may I remind him that, although he has just spent about five minutes explaining why he could not put any money in and telling us that happy times were here again, he has not only failed to deliver a single penny piece extra of public money for the railways, but has put private money in jeopardy by making his ill-considered attack on Railtrack?

The hon. Gentleman returns to his refrain about the private sector not wanting to invest in the railways because of the action that the Government have taken on Railtrack and says that private companies will walk away. Interestingly, when we discussed the matter on 15 October last year, he said:

"Where is the £34 billion of private investment to come from? The best we can hope for is a 12-month delay in investment in such vital services as the west coast and east coast main lines".—[Official Report, 15 October 2001; Vol. 372, c. 957.]

[Interruption.] It is said that that is exactly what happened. Well, today, GNER has announced £100 million of private sector investment in the east coast line. That happened this morning.

It is for rolling stock.

It is private sector investment; it is new money. Last year, the hon. Gentleman said that there would be a 12-month delay in private investment in the east coast main line, yet today GNER is making a contribution of £100 million. Let us consider how the money will be used. There is a contribution to the infrastructure upgrade—that is the track, not rolling stock; £10 million for stations and integrated transport; money for rolling stock reliability and static converters, and for improvements to rolling stock and extra coaches. Every pound and every penny of the £100 million constitutes private sector investment. So much for the hon. Gentleman and the 12-month delay in private sector investment.

Will the Secretary of State give way?

No, I have given way to the hon. Gentleman, and it was a bit embarrassing. [Interruption.] Oh, go on then.

Let us be clear. Does the Secretary of State claim that the upgrade to the east coast and west coast main lines can be covered by such relatively small sums of money? Is that why he is trying to get out of phase 2 of the west coast upgrade? Is that why he is trying to negotiate to ensure that we do not get trains that travel at 140 mph? In the world that he occupies, are such little gifts regarded as major triumphs?

We have 25 franchises, many of them for much longer than two years. A two-year extension secures £100 million of private investment. Conservative Members like to claim that the private sector is walking away from investing in the railways; it is not. When it perceives a good investment and a good return, as GNER and the rolling stock companies did with the east coast main line, it will make the investment.

The transport plan and the 10-year plan is clear and precise about the way in which the money will be spent. There will be a public sector contribution, much of which will be invested in the infrastructure, and private sector investment, partly through special purpose vehicles and partly through the new franchising arrangements.

Is my right hon. Friend aware that the last Conservative Chancellor gave only £500 million to upgrade the whole west coast main line? When Railtrack went into administration, the predicted cost for upgrading that line was £10 billion. It would have been cheaper to build a brand new line.

My hon. Friend has followed the vagaries of the west coast main line in considerable detail. He knows that the project was dogged first by a failure of political commitment by the Conservative party. We have tried to drive it through. As time goes by, the new management of Railtrack is beginning to realise the state of the project, and greater difficulties are becoming apparent.

However, it is important to acknowledge the significant contribution and investment that Virgin has made in the new rolling stock that it has earmarked for the line. That is another good example of private sector investment; the new trains are impressive. We must recognise Virgin's commitment. We have to work with Railtrack and the SRA to make sure that we conclude an agreement that will deliver on the west coast main line and make a genuine difference to the travelling public.

In the Select Committee meeting this morning, the Minister said that he favoured fewer train operating companies, perhaps because so many operate at a loss. Will GNER be one of the train operating companies that is likely to disappear?

The fact that GNER has made a commitment of £100 million suggests that it will be around for the long term. I am confident that it will be involved in the refranchise when it happens because it offers a good service on the east coast main line. However, it is right to go through the franchise process to ensure that we make a genuine difference.

Conservative Members have often made points about private finance in the current circumstances. Much has been written in the Financial Times and other newspapers about the clear distinction that the City makes between the financial state of a private company such as Railtrack, and the sort of public-private partnerships and special purpose vehicles that we envisage for investment in the railways in the future. That is how it should be, and I think that there is a recognition that that is the case. GNER has clearly demonstrated this morning, with its £100 million investment, the way in which the private sector wants to continue to be involved.

I shall conclude with a few points about the SRA' s plan, which was published on Monday. The short-term priorities identified in the plan reflect the need to tackle problem areas such as poor performance, to develop a new industry structure following the Railtrack administration, and to implement much needed improvements throughout the country. For the medium term, the Government have set three core targets for the railway industry through our 10-year plan, all of them to be met by 2010. Those targets are passenger and freight growth of 50 and 80 per cent. respectively, and a reduction in overcrowding in the London area. The 10-year plan also sets out a broader range of objectives for the railways, including improvements in safety, performance and quality.

The Secretary of State has raised the issue of safety. Does he know whether Lord Cullen's recommendations on improvements in signalling in the Paddington area were implemented by 19 December last year, as they were expected to be?

I understand that the train protection warning system was introduced fully in Paddington during the autumn of last year. The hon. Gentleman is right to pick me up on Cullen, because he raised the issue earlier and I must address it. Cullen asked for an investigation into whether compliance had been achieved by 19 December. That work has been concluded, and certain issues are now being clarified. As I said in my earlier intervention, the conclusions will be published in March. However, the delay that has been incurred has exposed a weakness in the Health and Safety Executive.

The delay came about because the HSE was not properly staffed to deal with that level of work in the time in which we all agree it needed to be done. I have made sure that it is to be staffed at a proper level. In 1999, there were just 56 railway inspectors at the HSE. I agree with the hon. Gentleman that this is a vital area, and the work was not being done quickly enough so far as I was concerned. As a result of the action that we have taken, there will be 196 railway inspectors at the HSE by March this year. The sort of delay that we have seen will not be repeated, and we can treat safety issues as a priority in the way in which the hon. Gentleman wishes us to do, in relation not only to Cullen but to the whole range of safety issues in the industry.

The broader range of objectives for the railways includes safety, performance and quality. Although the strategic plan focuses on the short and medium term, the longer term is not neglected. I have no doubt that the condition of the railways in the United Kingdom is not one of which anyone can be proud. I say that as Secretary of State for Transport, Local Government and the Regions. I took the decision that we were not going to tinker around at the edges of the problem, or muddle through; rather, we would take the necessary decisive action.

I have come in for a great deal of political criticism from Opposition Members for the actions that I have taken. I do not regret the decisions that we have taken, because decisive action was necessary if we were to create a railway system fit for the 21st century, and the one that the fourth largest economy in the world deserves. We have not got that yet, but I am confident that, because of the decisive action that we have taken over time—there are no quick fixes so far as railways are concerned—the travelling public will be able to see real improvements by 2005. By 2010, at the end of the 10-year plan, we shall have had the significant sustained investment that the railways need, which will change dramatically the quality of experience so far as the travelling public is concerned.

Priority will be given to railways; that is my commitment as Secretary of State. It is a commitment on which I intend to deliver for the Government and for the travelling public. On that basis, I ask the House to support the amendment.

4.49 pm

I refer the House to the declaration that I made on Monday 14 January, which can be found in Hansard at column 33.

There can be no doubt that the state of the transport system in this country, and of the railways in particular, is a matter of prime concern to everyone. Central to that is the performance of the Secretary of State for Transport, Local Government and the Regions. He has repeated this afternoon what he said to The Guardian on Monday 14 January:

"There can be no more excuses. It's now our responsibility … I am taking responsibility."

So said the Secretary of State. Of course, his responsibility is at the heart of today's debate, because the motion is about whether we think that he is doing a good job on the railways.

It will surprise no Member of the House to hear that I think the Secretary of State is doing a pretty bad job. [HON. MEMBERS: "Oh!] I realise that that is a revelation to every Labour Back Bencher, but nobody who has read the press or listened to commuters in recent weeks can be in any doubt that that view is widely held outside the House. Indeed, if the silence on the Labour Benches on Monday when the Secretary of State made his statement on the Strategic Rail Authority's 10-year plan is anything to go by, he can take little comfort in thinking that his colleagues have a better opinion of his performance.

It so happens that Newcastle's The Journal recently asked the Secretary of State about his performance:

"Are you confident you're up to the job?"

He replied:

"I've got no doubt. People will not take my word for it. They'll look to see what we deliver in practice. That's the acid test."

He is delivering in practice a 45 per cent. increase in train delays and what the Minister for Europe tells us is the worst railway in Europe.

We know that the Secretary of State has been undermined by the Prime Minister's appointment of Lord Birt to consider transport policy, and I am grateful to the hon. Member for Bath (Mr. Foster) for his reference to the fact that the Secretary of State thinks the Prime Minister has appointed Lord Birt in order to keep him occupied. The Secretary of State has been undermined elsewhere. He told readers of The Guardian that he might perform a U-turn on the London Underground public-private partnership, but the Prime Minister told us that the tube PPP is definitely going ahead.

The Secretary of State cannot now rely on the other blue-eyed boy of new Labour, the Secretary of State for Health. On Monday, the Secretary of State told us in his interview with The Guardian:

"There is not a love affair with the private sector."

However, the Prime Minister reminded us this afternoon that the Government's health service strategy is all about private sector partnerships for the future of the NHS.

In fact, the Secretary of State cannot even rely on himself. I wonder whether he remembers telling The Guardian:

"I do believe in the Third Way".

On Monday, he told us that he is backtracking from the third way because it is becoming "flaky". All that would be an amusing farce were it not for the fact that underlying it is something that matters to the quality of life of everybody in this country—the state of the railways. Passengers' quality of life is not the only issue, because the impact on the economy of having a decent railway system, or one that is not working properly, is also involved. The problem is not just the state of the railways today, but their state in the future.

Dragging us back to the point, how much more would the hon. Lady like to be invested above and beyond the 10-year plan? Would she re-privatise the railways?

I find the hon. Gentleman's second question a little surprising, because the train operating companies are still in the private sector. I apologise, because I cannot remember whether he was one of those who applauded the Secretary of State when he put Railtrack into administration.

I was.

Excellent, but the hon. Gentleman may think twice about the Secretary of State's actions when he discovers that the company to replace Railtrack will be a private sector company. Far from changing the structure of the railways, which the Labour party has always said has so many problems, the Secretary of State is keeping the structure between Railtrack, the replacement Railtrack and the train operating companies exactly as it was under privatisation. The hon. Gentleman needs to find out more about his party's policy before intervening.

My hon. Friend might refer to the Secretary of State's very own SRA plan, which says that

"almost all new projects will be financed by Public Private Partnerships"

and not through capital support from public funds. He is hiding behind a private sector strategy in the document.

I am grateful to my right hon. Friend, who is absolutely right. Now that this has been pointed out to Labour Members, I hope that they will start to understand a little more about what the Secretary of State's promises actually mean.

I would like to refer to investment, and I shall do so briefly. I am grateful to the hon. Member for Bath for placing on the record the Library figures that compared the investment record of the last five years of the last Conservative Government with that of the first five years of this Government. The facts are clear. Investment in the railways during the last five years of the Conservative Government was higher than in the first five years of this Labour Government. The figures quoted by the Secretary of State on Monday are repeated in the Government amendment today, namely the investment in rail of £4.3 billion for the 10-year plan, compared to £1.4 billion for the five years up to 1996–97.

I have discovered how the Department came across these figures. I understand that it took the £49 billion of total public and private investment from 2000 to 2010, divided it by 10 and adjusted it for cash-expected prices. The Department then looked at the SRA national rail trend statistics on the SRA website—there are two different sources for the statistics—referring to Government support only, and averaged only public sector investment over the last five years of the last Conservative Government. The Secretary of State says that actually what people care about is the total amount of investment and not where it comes from, but they also care about the Government giving the facts correctly and not trying to spin fantasy figures to tell a political story that is not true. I hope that the Secretary of State will in future quote the right figures when he talks about investment.

Is the hon. Lady aware that if one takes the much-vaunted £180 billion of investment for the 10-year transport plan overall and, instead of adding accumulatively the various amounts, studies it on a constant price basis, it comes to only £157 billion? By the time one takes out all of the money that is regularly spent each year, the hon. Lady will agree that it amounts—to use a phrase coined by a Labour Member—to not much more than a string of beans.

That point about the Government's fantasy figures was taken up in the leader column of the Financial Times yesterday, which concluded:

"There can be only three conclusions. The promised enhancements will not happen; much greater public subsidy will be required; or the amount of double counting in the government's £180 billion 10-year transport plan is much greater than was previously clear."

We know that the Government double and triple count, and they have done that in terms of the railways and transport investment, but people know the reality because they know what they experience every day when their trains are not running on time or are cancelled.

Investment is a key issue in looking ahead to improving the railways for the future. There is a black hole at the heart of the Secretary of State's plans. He prays in aid the Financial Times in terms of looking at private sector investment for the future and says that the private sector will come forward with all of the investment, but yesterday the Financial Times posed a very important question to the Government:

"In its 10-year plan for transport, the government estimated that it could persuade the private sector to invest £34 billion in the railways over the period … The question is: where will the revenue come from to finance this new private investment?"

Even if money comes forward, it will do so at an increased cost; the price to the taxpayer or to the passenger, through fares, will be higher. We have had estimates that it could be as much as an extra £1.5 billion over two years. Again, I am grateful to the Financial Times, which said:

"If fares raise £3.4 billion, this achieves a maximum of £1.7 billion extra a year at the end of the plan. Not nearly enough to provide a commercial return on £34 billion of new private investment."

If the Secretary of State gets his money, it will be at a higher price to the taxpayer or the fare payer.

When the Minister for Transport sums up, perhaps he will tell the House what the Government estimate will be the extra cost of obtaining that £34 billion from the private sector, as a direct result of the Government's actions with regard to Railtrack, which have so damaged private sector confidence. [Interruption.] The Minister for Transport is laughing at that question so perhaps he would like to answer another one. How much of the private sector investment that is forecast in the 10-year plan from the SRA will he guarantee will have been put in to the railways by the time of the next general election?

The Government have created a problem for themselves through the way in which they handled Railtrack and put it into administration. That problem is accepted by the SRA which says in its plan that one of the milestones that needs to be passed on the way to delivering the strategic plan is the resolution of the Railtrack administration and the implementation of any financial and structural reforms that are needed as a result. [Interruption.] The Minister for Transport yawns when I mention the 10-year plan, but I thought it was the plan to end all plans and would give us all the answers on the railways. He is the same Minister for Transport who informed us that while the Secretary of State was on holiday in India he had not been in touch with the Department: it was not necessary, the Minister for Transport told us, because he was in charge so everything would be all right. He now seems to be bored by the issue.

Perhaps the Minister would explain to us when he thinks Railtrack will come out of administration and the costs will be closed down. The administrators have told me—it has been confirmed in written answers—that the cost up to March will be £2.9 billion. That is what they have asked the Government for. If Railtrack stays in administration for as long as is now predicted by commentators—until the middle of next year—an extra £7.5 billion will be needed to pay the costs of administration. The problem with that is the impact that it is having on the railways that the travelling public use. Delays have increased and people are suffering cancellations, but the 10-year plan gives no hope that they will see the increased capacity in the system that is needed if overcrowding is to be reduced and the quality of journeys improved.

The issue is not only about individual passengers, but about the impact on the economy. As the British Chambers of Commerce has pointed out to me:

"A coherent and comprehensive transport strategy is essential to UK business competitiveness … the Government has missed a once in a generation opportunity to plan ahead sensibly for the long term sustainable development of the UK rail infrastructure."

The problem is that the Government have not put that new capacity in place.

Other aspects of the plan should worry rail passengers. It suggests a reduction in the number of train operating companies and the merger of some franchises, but the SRA has also stated its aim of giving priority to express services, and that could lead to a worrying situation. I shall give an example from my constituency. Maidenhead and Twyford stations are served by Thames Trains. First Great Western goes from Paddington through to Reading without stopping at Maidenhead or Twyford. The SRA proposes that First Great Western and Thames Trains should merge. When they do and if express services are given priority, how many services that currently stop at Maidenhead and Twyford will be cut as a result of the Government's plan? Will the names of Byers and Bowker go down in the annals of rail history alongside that of Beeching? How many local services and stations will be at risk?

The Secretary of State says that he is responsible for the state of the railways. He promised us a 10-year plan that would give us a railway fit for the 21st century, but the real problem for passengers is that the 10-year plan does not deliver the increase in capacity that is necessary to improve services. The real problem is that the right hon. Gentleman does not know whether he can deliver a 10-year plan because he has no guarantee of future private sector investment or even of the public sector investment that he proposes. He is not delivering capacity, he is not improving services, and he gives passengers no hope.

Recently, in an interview, the Secretary of State said that his decision on Railtrack was high politics. It is time that he stopped playing high politics and started delivering the railways that passengers want and the economy needs.

5.5 pm

I speak in favour of the amendment and against the motion. In fact, the motion would have been better if it had included the words "When the Secretary of State is successful he will receive a huge bonus." I am convinced that my right hon. Friend would indeed receive that bonus.

I congratulate the Secretary of State on the good work that he is doing. I was delighted when he said that he wanted to stay in the job for many years. When we consider the history of transport in this country, we realise that one of the problems is that Transport Ministers do not stay in post for very long. I notice that the right hon. Member for North-West Hampshire (Sir G. Young)—a former Transport Minister—is in his place. Under the Conservatives, there were about a dozen Transport Ministers during 18 years, and under the Labour Government there have been four. That has added to some of the problems.

I hope that the Secretary of State and his team stay in their jobs. There is one reservation, however: we need a Secretary of State who has responsibility only for transport and nothing else. We should remove all other responsibilities. That was a problem under the previous Government. We should focus on transport, as it is important for the people of Britain and has an essential role for our future. It is wrong to add further responsibilities to the role of the Secretary of State. The role of a Secretary of State for Transport would be every bit as important to the daily lives of people in this country as that of the Foreign Secretary or the Secretary of State for International Development. I want the restoration of a Ministry of Transport.

Recently, the Secretary of State has been criticised unfairly—not least for his decision to ask that Railtrack be put into administration. There is no doubt why that criticism was made. Many wealthy and influential people lost a large amount of money. There was no cry from the Labour Back Benches or the general public to the effect that my right hon. Friend's decision was wrong—we think it was the right decision. However, some of the wealthy people who lost money are extremely influential—especially in the Conservative party.

Is the hon. Gentleman suggesting that more than 90 per cent. of Railtrack employees, some of whom lost their life savings as a result of the Secretary of State's action, are all wealthy?

I am suggesting that I represent hundreds if not thousands of railway workers, but I have received only two letters from railway workers who actually lost shares. The rest of them accepted that Railtrack was not working, that the Conservatives had made a mess of things and that the only way to put things right was to put the company into administration and then into a not-for-profit trust.

My information from friends in the rail industry is that they want secure jobs in an industry that will be secure in the future. They have written off their shares in Railtrack—they largely blame that on the Tories.

I wholly agree with my hon. Friend. If people want a job with a secure future, those jobs will be on the railways. I come from three generations of railway workers, but when I left school in the 1960s my father told me not to look to the railways for work because there were no jobs in the industry. The situation has changed and the industry now offers a secure future. Indeed, there are now too few skills in the industry—too few people know how to run a railway—and we need more skilled people.

Is my hon. Friend aware that sickness rates among Railtrack staff plummeted after the Secretary of State's announcement that he was putting the company into administration? Is not the fact that the Government are taking an active hand a measure of the confidence of the staff?

I think that the high sickness rates were a measure of the lack of confidence in the people running the railways. The trouble with Railtrack was that it was run by accountants and not by railwaymen. [Interruption.] Perhaps the hon. Member for Maidenhead (Mrs. May) wishes to declare an interest.

Back-Bench Labour Members support the decision to place Railtrack into administration, as does the vast majority of the general public. The decision came as a surprise, and it was a welcome reversal of Government policy. I remember asking my right hon. Friend the Prime Minister two years ago whether he would consider reversing the decision on rail privatisation. He told me that that was not necessary and that the SRA and extra investment would sort out the problems. Only recently has my right hon. Friend agreed that that strategy had failed.

On 23 March last year, I introduced a private Member's Bill. If it had been passed, it would have earned a rather grand title—the Railways Act 2001. The proposal was simply that we should look at how the rail infrastructure was being managed and controlled, and that a report should be prepared containing alternative options. I proposed six options, which included nationalisation, regionalisation and the establishment of a not-for-profit trust. Safety would have been the main priority of such a trust, with any surpluses being ploughed back into the infrastructure.

I am sad to say that the Government opposed my Bill very strongly. My hon. Friend the Under-Secretary of State for the Home Department, my hon. Friend the Member for Coventry, North-East (Mr. Ainsworth), was the relevant Minister at the time. He spoke against the proposals with some conviction and passion, and anyone who reads column 639 of the Hansard record of 23 March 2001 will see the reasons for the Government's position at that time.

I am conscious of the fact that the present Secretary of State was not involved in the debate on my Bill. I was delighted when he took the decision about Railtrack—it sent the message that this country's rail system could never work under a privatised Railtrack. I would not disagree completely if the Government were to argue that they had given Railtrack an opportunity and that it had become obvious that the company was going to fail. I am pleased that we are where we are today, and I am sure that we can go on to better things.

I deal now with the west coast main line. I am sure that my right hon. Friend the Minister for Transport would not expect me to make a speech on the railways without talking about that line, which has been in a terrible state for many years and which is still crumbling. I formed the all-party west coast main line group 10 years ago this month. The group is very active, and we had the pleasure of the company of my right hon. Friends the Secretary of State and the Minister yesterday. A total of 50 people, from both the Commons and Lords, attended the meeting.

When she was Prime Minister, the then Mrs. Thatcher cancelled the advanced passenger train, also known as the tilting train. The Swedes and Italians subsequently pinched the technology for such trains, which are now being imported back to Britain for the west coast main line. That Conservative Government made no investment in the line, even though it is the country's main rail artery. Hon. Members from Scotland and Wales complained earlier about the lack of investment, but they must realise that an upgraded west coast main line is essential for improved services to north Wales and to Scotland.

The west coast main line has been allowed to decay to a terrible extent. I mentioned earlier that the last Conservative Chancellor, the right hon. and learned Member for Rushcliffe (Mr. Clarke), suggested that the difficulties could be put right by the application of £500 million of Government money. The latest estimate is that continuation of the plans for the line proposed by the privatised Railtrack would cost £10 billion, and that it would be cheaper to build a brand new line.

I accept that the SRA is right to look at the project again, but it is a misconception to believe that work has not started on upgrading the line. A lot of work has already been done, and the first stage of the project should be complete by 2003. By the summer of this year, the first Virgin tilting train should be running, taking guests and competitors from London to the Commonwealth games in Manchester.

Within a year, 53 new train sets should be running on the west coast main line, giving us a good new service. I understand that the old rolling stock is to be scrapped, as it deserves to be, but decisions remain to be made. The first is whether to accept the proposal that trains on the west coast main line should be allowed to travel at a maximum speed of 140 mph. The first stage of the project will allow tilting trains to travel at 125 mph, but the trains are designed to do 140 mph, so the matter needs to be debated and discussed.

A second matter for discussion is the mix of services on the line. The hon. Member for Maidenhead mentioned her constituency, and it is clear that we must think about local traffic, cross-country traffic and freight traffic as well as express services. The SRA must come up with the mix that is best for the railways.

I was pleased that my right hon. Friend the Secretary of State was able to tell the all-party group that by the end of February the SRA will have produced a definite blueprint for the west coast main line.

The hon. Gentleman will have read the SRA's document fairly carefully. It does not give any commitment as to when PUG2—passenger upgrade 2—will be completed. Was his all-party group able to obtain any commitment on that matter from either the Secretary of State or the Minister for Transport? Or does he think that the new Pendelino trains will run at 125 mph for the rest of their life?

I was in the chair at yesterday's meeting, which meant that I had the advantage of being able to put the first question to my right hon. Friend the Minister for Transport. That was the question that I asked, and his reply was that the matter would be decided by the SRA before the end of February. I believe that in some areas of the country it will be relatively cheap to allow trains to run at 140 mph, but that it will be very expensive in other areas.

A decision therefore has to be made, but there is no doubt that the original costings that caused Sir Richard Branson and Virgin to buy trains that could travel at 140 mph were sadly flawed. Those costings put the total amount of money involved at around £2 billion or £3 billion, not £10 billion. I believe that the train companies using the west coast main line will come to a sensible agreement on the matter.

Finally, I turn to that part of the SRA report that deals with the need for a National Rail Academy. I am pleased that it has finally been accepted that there is a massive skills shortage on the railways. I asked my right hon. Friend the Deputy Prime Minister and First Secretary of State about that two years ago, and he replied that serious problems existed. The SRA clearly accepts that.

Earlier in 2000, I had discussions with the then Minister for Lifelong Learning, my hon. Friend the Member for Croydon, North (Malcolm Wicks). He came to Carlisle and we gave him a good demonstration of how the National Rail Academy could work. We showed how it could be funded, where it should be based and how quickly we could get the project off the ground.

My right hon. Friend the Minister for Transport will not be surprised when I tell him that all the available data pointed to the fact that the academy should be based in my constituency. However, if the SRA is serious about reducing the skills shortage quickly, a quick decision on the National Rail Academy is needed. Carlisle is one of the options for its location. If we do not get the skills, we will not complete the 10-year plan. It is simple as that, and it will not matter how much money is spent or whether it comes from the private or the public sector—if we have not got the skills, the plan will not work.

In conclusion, the Secretary of State has my full confidence. He has taken some hard decisions and a lot of criticism—he seems to be able to take a lot of criticism, and I applaud that as well—but he has to change the Government's policy on the railways and Railtrack, and the decision that he has taken will bear fruit in the future.

5.20 pm

Whatever disagreement the hon. Member for Carlisle (Mr. Martlew) may have had with the last Conservative Government, we did at least have his support on one issue—the fact that there was a separate Department of Transport for the whole period from 1979 to 1997, whereas Labour put transport back into a much larger Department. I clutch at that straw from his speech as a sign of support of the Conservative party's transport policy.

When I saw the Liberal Democrat motion on the Order Paper, my first feeling was one of sympathy for my successor but one at the Department of Transport—it is a difficult portfolio and a subject on which every citizen has a view and the press can be pretty merciless—but when I saw the Government amendment that feeling of sympathy soon passed.

In the weeks since Railtrack's collapse, the Government have sought to defend what they did by saying that privatising the railways was wrong, that it was a privatisation too far, that the structure was too fragmented and unsustainable and that there was therefore something of the inevitability of a Greek tragedy about what has happened in recent months. As one of those who was directly involved, I should like to put the opposite case, not just to explain why we did what we did, but, more important, because we will get the wrong solution if the wrong analysis is made of the current crisis. Simply parroting the words "botched privatisation" or "fatally flawed" gets everyone nowhere.

There was one overpowering argument for privatising the railways: privatisation would unlock the capital needed to modernise the rolling stock, the permanent way, the signalling and the stations and to build new links such as Thameslink 2000. Decades of underinvestment had to be confronted. That investment was, in turn, the key to a balanced and sustainable transport policy, reducing dependence on the car and the lorry by developing attractive alternatives and seeking to contain the never-ending demand for more roads. But there were other reasons as well.

Will the right hon. Gentleman give way?

This speech will not stop at many stations, but I shall give way to the hon. Gentleman in a moment.

British Rail was inefficient, monolithic and hidebound by tradition. The skeleton of the advanced passenger train at Crewe is a monument to the problems that the public sector had in introducing new technology. British Rail's culture stifled the good management potential that was locked inside.

Privatisation was going to transform an industry that looked inwards to the Department of Transport for support into one that looked outwards to its market for custom. It was going to bring into a rather introspective and protected industry successful operators of other transport modes. It was going to reduce the subsidy for running trains, by removing some of the cosy practices that had grown up unchallenged for decades and freeing up the money for other public services. So the policy was not some mad ideological transfer—John Major was a pragmatist with a deep suspicion of ideology. We both wanted a better railway, and privatisation of transport was part of an approach to improving public services that had worked successfully elsewhere.

That starting point was underlined by my experience of getting money for transport when the railways were in the public sector. I would appear before EDX, or whatever Cabinet Sub-Committee was adjudicating on public expenditure, usually chaired by my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke). My colleagues would declare their pleasure at seeing me, saying how imaginative my view on the future of the railways was and how well presented was the associated bid for funds, but they would say, "But, George, you have to understand that our priorities are health, education and law and order. Colleagues in other spending departments have put forward equally interesting proposals, more central to our manifesto. We are sure you will understand if your bid is cut back, and your presentational skills will enable you to defend the settlement."

Although much has changed since 1997, that feature has not. In Labour's first term, only one section of the transport industry was starved of the capital that it needed—the only section still in the public sector: London Underground. Passengers faced fare rises higher than those on the railways, and the backlog of investment got worse.

As the Secretary of State said on Monday, passengers do not mind where the money comes from, and when the industry was moved from the public sector to the private sector, which is where I believe it should be, the dead hand of the Treasury was lifted. The constraint on expenditure was no longer how much I could get out of the Chancellor, but how fast the train operators, the train manufacturers and Railtrack could sensibly invest.

People might accept the strategic decision on privatisation, but have doubts about the structure—the so-called fragmentation. That is a highly complex issue on which I wish to make two brief points. The first point is simply that industry today is more disaggregated than it was 40 years ago. People make less themselves and buy more in from others. There is more specialisation, more subcontracting and greater flexibility in the market. Car manufacturing is a good example, with the manufacturers basically assembling bits made by other people. That specialisation and subcontracting is not just a feature of industry; it happens in medicine, education, the sciences and services. So the British Rail monolith was no longer the best model.

There is a second, more specific, point, however: the safest and most successful transport industry in this country is the most fragmented—civil aviation. That industry is subdivided into far more component parts than the railways. The stations—the airports—are in multiple ownership. Some of them are owned by the British Airports Authority, some by local authorities and others by bus companies. Signalling—air traffic control—is totally separate from the airports and the airlines. There are tens of different train operators—the airlines—and if a new airline puts on a new service from Luton to Glasgow, we do not say that it is an unwelcome fragmentation of the industry; we welcome the new service. The airlines do not own the aircraft; they lease them, and they are maintained and serviced by others. Someone else does the baggage handling and other companies do the catering. Civil aviation is a disaggregated, specialised industry, linked by contracts. Critics might call it fragmented, but it is safe, successful and popular.

Will the right hon. Gentleman give way?

I will briefly stop at Surbiton—an important suburban station.

Does the right hon. Gentleman have no regrets about the structure of the railways that he chose? For example, Japan went for a privatised railway that was regionalised but vertically integrated, and its railway has been terribly successful—unlike the model that he chose.

I do not agree with the hon. Gentleman. We looked quite hard at that model. It is very inflexible, and it is difficult to get in a succession of train operators if they also own the infrastructure. We set up a basic structure of unified network ownership: Railtrack; train operating companies, which run the services on franchises; and the so-called ROSCOs—the rolling stock companies—which own the rolling stock and lease it to the train operating companies.

Will the right hon. Gentleman give way?

No. I must make progress.

There is also a transparent and independent system of regulation. As my hon. Friend the Member for Maidenhead (Mrs. May) said from the Front Bench, that core structure has rightly been virtually untouched by the Government.

However, another factor was at work before 1997, and it was every bit as important as the structure. We all know of some very odd structures that work well because people want to make them work. Before 1997, all the players were determined to work together to build a better and safer railway.

After privatisation, Ministers, Railtrack, the train operating companies, the franchising director, the regulator and all the new people who we attracted in from the other transport industries, such as shipping, aviation and buses, worked together with the excellent managers who joined from British Rail. We all believed that that was a new chapter in the history of the railways, in which we could access the funds we could never get from the Treasury, reverse decades of decline and play a key role in a more balanced transport policy. It may be an old-fashioned word, but there was trust between the key players.

Initially, things went well, and the number of passengers started to rise. Indeed, more people now travel on the trains than at any time since 1945. More train services were put on. Indeed, there are now 25 per cent. more trains. Freight was attracted back off the roads. Safety and punctuality continued to improve, and key fare increases were pegged to protect commuters. The subsidy paid to the franchise operators was less than the subsidy paid to British Rail to run the network, and the planned investment in new rolling stock and stations increased substantially. Railtrack began ambitious plans to build new links between the lines north of London and those to the south of it and, as we have just heard, to modernise the west coast main line. Those who were running the system genuinely believed that there had been a renaissance in our railways and that, after decades of underinvestment, a new future was opening up.

Then we lost the 1997 election. It would be naive to blame everything that has gone wrong on the change of Government in 1997. I am not politicising the problem, and nor would I wish to. One of the difficulties that I faced was the absence of a consensus on how the railways should be run. Had we been re-elected in 1997, I am sure that we would have wanted to make modifications in the light of experience—as we had done with other privatisations—but I am convinced that we would have avoided the debacle of last October.

The key factor that I have just mentioned—the determination to make the new system a success, with everyone working as a team—began to be eroded after June 1997. The new Government had opposed privatisation, but they had neither the funds to renationalise the railways nor the political will to make privatisation work. Ministers started to settle old scores, sniping at some of the new train operators and at Railtrack. The team spirit gave way to the blame culture. The regulator was sacked, and a new and at times aggressive rail regulator began to make it difficult for Railtrack to raise the capital it needed. A new Strategic Rail Authority was set up between the Government and the industry, making things more complicated rather than simpler. The letting of new franchises was suspended, with short-term renewals instead of long-term contracts, and personality conflicts got in the way of the industry's needs.

Crucially, there were management failures at Railtrack and elsewhere. I was interested to read page 15 of the strategic plan, which states:

"Whilst it is true that some structures can be more unwieldy than others, it remains fundamentally the case that neither contracts nor regulation manage companies: people do. It is the failure of the management process in the railway industry that is at the heart of what needs most to be corrected."

I agree. Management failures, principally at Railtrack, began the process of erosion of public confidence. After Hatfield, Railtrack lost its nerve. Then Gerald Corbett resigned and it lost the confidence of politicians and the City.

Without being party to the negotiations with Railtrack last summer, it is difficult for an outsider to comment on what went wrong. However, something clearly went wrong in the management of the dialogue between Railtrack and the Government. It may be that a key ingredient was missing—the will to find a way through the problem. The Secretary of State may never have wanted a deal, or the Treasury may have made it clear that it would not fund one at any price.

If that is the case, Railtrack should have spotted what was going on and not overplayed its hand. If Railtrack's dividend policy was a problem, it should have put that issue on the table for discussion with the Government. If its policy on executive pay was a problem, that should also have been put on the table for discussion. If the Government had doubts about the competence of management, those doubts should have been talked through.

What actually happened, however, was that the Secretary of State was leaning over the patient discussing a cure at the same time as he had his foot on the oxygen pipe. Not surprisingly, the patient expired. Eventually, we will find out what went wrong, but the breakdown of that dialogue was a disaster. I have no doubt that the National Audit Office and the Public Accounts Committee will want to inquire into the actions of the Department for Transport, Local Government and the Regions. They rightly did that for the privatisation process and I have no doubt that they will do it with equal vigour for the de-privatisation process. I hope that they ask whether the Government costed the alternative when they pulled the rug from under Railtrack.

If the Secretary of State thought that he had a new, inexpensive and popular solution, he was wrong. His action has raised more questions than it has answered. The railways now face a period of uncertainty, with a question mark over investment and a field day for the lawyers. There will be more disruption, more delay, more discontinuity, more short-term franchises and an exodus of talent. I have no doubt whatever that the taxpayer and the passenger will pay more than they would have done if a sensible deal with Railtrack had been arrived at and that improvements will take longer.

The private money that was going to be invested by Railtrack in modernising the railways—£34 billion—is no longer available on the same terms, if at all. The Government will have to find more money themselves, and the history of the railways shows that Governments do not put up the money that is necessary. The action that the Government have taken to put Railtrack into receivership will have repercussions way beyond the railways. They will reverberate throughout the growing dialogue between the public and private sectors on joint ventures, and make the City and international investors ultra-cautious about investing in projects in partnership with the Government.

I note in passing that the Government's policy for the railways sits uneasily with their policy for London Underground. With the underground, the Government want to keep the operation of the trains in the public sector but use the private sector to modernise the infrastructure. However, with the railways, the Government are leaving the running of the trains in the private sector while the public sector assumes responsibility for the infrastructure. It is difficult to see a coherent approach in their transport policy.

What happens next? Let us look to the areas of agreement across the Floor. I accept, as do the Government, that there should be unified ownership of the railway network—the bits that do not move—and that the company that owns it, the son of Railtrack, should look to the private sector for the capital that is needed to modernise it. That should be off the Government's balance sheet. I have no difficulty with special-purpose vehicles, which are a new form of financial rolling stock.

We agree that the trains should be run by companies in the private sector on franchises that are competitively bid for. Those companies can be sacked if they under-perform. We could never sack British Rail, so we have created something that we never had before—a competitive train operating industry. We agree that the companies should lease their trains from others if they want to. We also agree that there should be transparent and independent regulation of the industry to ensure fair play. So there is a quite a lot of common ground.

What is fragmented is the Government's response, with the Secretary of State and his Department being second-guessed and shadowed by Lord Birt and others in a number of unaccountable bodies at No. 10. It must be up to the Transport Secretary, who is accountable to Cabinet and answerable to this House, to come up with the strategy.

We have to sort out Railtrack quickly because that lies at the heart of the system. Without Railtrack or its successor functioning properly—instead of being run by receivers—there is nothing on which to build. If there is a way through the litigation and the various bids, it must be pursued. New long-term franchises must be let before blight descends, and we must stem the exodus of skills from the industry.

Finally, it is vital to restore the confidence of the private investor, as the Treasury will never fill the funding gap. That can be done if the will is there and if trust can be rebuilt. However, I do not believe that the current Secretary of State—admirable qualities though he may have—is the right person for that task. Having drawn his line in the sand, he is on the wrong side of it. The Prime Minister should ask someone else to begin the process of rebuilding.

5.38 pm

I shall use my time in the debate to be somewhat parochial and to consider what the strategic plan means for Wales and Welsh railway services.

I have been here since the start of the debate and listened to the arguments of Conservative Members. I am stunned that, in every contribution that they have made, there has been no whisper of an apology for the fact that rail services are in their current state as the result of what has happened, not overnight, but over 20 or 30 years. I shall cite some examples from my area that show that it is a travesty that the Opposition have not had the courtesy to apologise for the fact that this debate has had to be called today. The hon. Member for Maidenhead (Mrs. May) referred to the Secretary of State taking responsibility. However, from a Back Bencher's and rail user's point of view, that is a refreshing and welcome change. Opposition Members have never taken responsibility.

I welcome the Strategic Rail Authority's plan and what it means for my area. I welcome the investment but, perhaps more than just the money, I welcome the overall co-ordination of rail services. I hope that we can stop the buck being passed, because I know from listening and talking to my constituents that one of passengers' major concerns is that, when they have a problem with the railways, they do not know where to go to obtain redress. That is why they come to me. They are stumped, in short. I write to rail companies and their responses often blame another rail company. Pinning them down has been one of the major problems for my constituents and passengers from west Wales.

The railways are important to west Wales. From the days of Isambard Kingdom Brunel, who saw the potential of having a railway junction in west Wales, which was also where ships could dock for transatlantic travel, we have had a long and noble tradition in the railways. We were fortunate to keep our rail link through the 1950s and 1960s and the days of Dr. Beeching. The railways are important because two ports still rely on them—Stena at Fishguard and Irish Ferries at Pembroke dock. Many of their passengers are foot passengers who travel by rail to cross to Ireland.

Our area is dependent on tourism. Part of our economic development strategy has been to preserve the beauty of the area and to encourage people to come to us by rail. We have tried to increase cycling and walking holidays, which has meant encouraging people to come by train. There are social considerations, too. Many people in Milford Haven, in my constituency, do not have personal transport. The rail link between Milford Haven and Haverfordwest is a valuable lifeline to our county town.

I mentioned the lack of an apology from the Tories. We can talk about money and the facts and figures until the cows come home, but it is the evidence on the ground that is important. In the 1980s, we lost our sleeper service to London. In the 1990s, before 1997, we lost our daily 125 service to London. That was an important factor for economic development; it prevented individuals from taking a day trip to London for business purposes or other reasons, because they cannot get back to Pembrokeshire and west Wales in the same day.

That problem was compounded by flawed privatisation, which is the most apt description of privatisation. Pre-privatisation, it took two hours 45 minutes to get from Paddington to Swansea; it now takes three hours. A cynical person could say that the extra 15 minutes were added on so that the privatised rail companies were less liable for compensation if things went wrong. Several hon. Members—notably from south-west England—have complained about journey times. I wonder whether their experience is the same as mine, because journey times in west Wales are certainly 15 minutes longer than they were pre-privatisation.

The other problem we face—again, it may be common to the south-west—is the replacement of train services by bus services. I inquired about that when it first happened because there seemed to be no logical reason, such as conflicting services, why the train should not carry on. The answer was simply a shortage of drivers. Since fragmentation and privatisation, drivers have been employed by different companies, so there is no pool of drivers to call on to take the trains to the end of the line. In addition to having an impact on links to the ferries, it also affects elderly and disabled passengers. They often catch the train because of the facilities and services that it offers and so that they do not have to lug their luggage on and off a bus.

Another important problem is that of local train connections. They have had a dramatic impact on train services to our area. The local linking train used to wait in Swansea for passengers from the mainline train. Post-privatisation, that changed. The train waits for a maximum of seven minutes because, after that, the other train operating company becomes liable for compensation. What are the benefits of that for passengers and customers? In my experience, privatisation has detracted from the service and removed choice and quality.

I mentioned my personal experience of passing the buck. I welcome the change at the top of the SRA. As a Member of Parliament who wrote to it, I have been unhappy that it appeared to be an apologist for the rail companies. The plan and the change at the top will, hopefully, lead to an improvement and to those companies being called to account across the board so that the buck can no longer be passed.

A pie chart in the SRA's strategic plan shows that Railtrack is responsible for 42 per cent. of rail delays whereas the train operators are responsible for 43 per cent. I had a meeting the other day with First Great Western trains. It gave me another pie chart that showed that Railtrack was responsible for 74 per cent. of the delays. Other reasons for delays, including the state of the fleet, were down to 26 per cent. That again shows the need for the vision and co-ordination that the SRA will offer from now on.

In my meeting with First Great Western, we obviously focused on a Welsh perspective. I want to draw the attention of the House to one or two things that I think can improve services in Wales. I also want to show that investment further up the line can have a dramatic impact on our services. It has been brought to my attention that there is no signalling in the Severn tunnel, which means that there is a seven-minute gap between every train that goes through it. If signalling were put in the middle of the tunnel, capacity would be increased and trains could go through every four minutes. Clearly, that would have a dramatic impact on the service to Wales in terms of capacity and reliability. I am told that only £2 million of investment is needed to do that, which seems a small sum in terms of the benefits that it could bring to Wales.

Junctions at Cardiff and Newport, which are especially slow, add to journey times and affect track capacity. That is another issue. First Great Western raised several problems further down the line. With regard to Swindon and Didcot, the joint use by slower freight trains has an impact on services to Wales. There are also concerns about the Reading bottleneck. That is a good example of how investment all the way down the line in the UK has an effect on the whole of Wales.

As a rail user, I have one small additional matter to raise: car parks. In my area, it can be a 40-mile journey to the nearest station to get a long-distance train. One problem is the lack of car parks and the security in them. Friends of mine have returned after four days to find the wheels missing from their cars. If we are to meet the Government's targets for rail use, it is vital that the problem of secure car parking be addressed.

Finally, one welcome feature in the strategic plan that has not been mentioned is the idea of providing accessibility for all and what that offers for disabled people on trains. The fact that all new vehicles will be fully accessible and that additional funding will be available to make all stations accessible is important, especially if rail is to play an increasing role in public transport in this country.

5.48 pm

I do not think that the hon. Member for Preseli Pembrokeshire (Mrs. Lawrence) should be in any way apologetic for taking a parochial view in the debate. If the debate is to serve any purpose, and I think that it serves many, it is for us to express on behalf of our constituents the cri de coeur that derives from their daily experience of public transport. If there is one thing that unites the House, it is the lamentable state of the railway system.

All hon. Members recognise that the travelling public's patience with the railway system is exhausted. They have to go through a daily misery, whether it is on the trains, the tube system in London or in the alternative forms of private transport on the roads that they choose to use instead of public transport—there is a knock-on effect. The most common sentiment that I discern among my constituents is a fatal resignation to the idea that the trains will not do the job that they want them to do. They are resigned to the fact that they will not arrive when they expect them to and that things are not getting any better.

Not only is that view expressed by people throughout Britain, but it is alarming to note that it is also expressed abroad. I draw the House's attention to an article in Le Monde this morning—I shall not attempt to read it out in French. Under a heading that includes the phrase "the worst railway misery in Europe", the article states:

"One cannot begin to find an end to the list of the difficulties that millions of users live with every day: breakdowns, accidents, delays, overcrowding in the coaches … "—

I suspect that that series of dots leads on to a gallic shrug. If that is the impression gaining currency both in this country and abroad, something must be done.

My constituency is served by several railway systems, not least of which is South West Trains. I do not want to dwell on SWT's problems today, save to say that the mud wrestling in misguided pursuit of machismo that has featured in industrial relations within that company does neither the railway industry nor passengers any good. The sooner a settlement is reached, the better for all concerned.

For every person in my constituency who struggles with SWT, there is a person who shares the experience of the hon. Member for Preseli Pembrokeshire of trying to use First Great Western, which operates the alternative route to London, or someone who has attempted to use the almost mythological cross-country service—everyone knows that starting in the south-west and trying to get anywhere other than London involves at least a day's journey, because the connections simply do not work—or local services. I am not over-sentimental about filling the gaps that Dr. Beeching left behind, although I remember as a child seeing from my bedroom window the old Cheddar Valley steam train. That track will not be brought back into service, but there are serious questions to be answered about infrastructure and the provision of better local services.

The knock-on effect of not providing a rail service is misery on our roads. It is instructive that on the first day of the industrial action on SWT it was almost impossible to use the A303 and M3. I am told that the traffic was backed up from London all the way to Winchester, which is not something that anyone with an appointment in London was prepared to countenance.

Our constituents expect, and it is reasonable to do so, reliability, efficiency, safety and affordability in their train services. They are sick and tired of the merry-go-round of excuses. The hon. Member for Preseli Pembrokeshire mentioned the buck passing from one company to another, each denying responsibility for the day's delays in the service. There is a merry-go-round of excuses at official level, among Ministers, Departments, and the various bodies charged with regulating the rail industry. Those merry-go-rounds are now matched by the carousel of consultants, some of whom have scant experience of the rail system, who have been brought into advise Ministers and the rail service. What on earth John Birt's role can be, I do not understand. No expert on the police, he does not appear to have improved that service, and he is certainly no expert on trains—indeed, it is reported with some degree of authority that he is averse to using trains in both his personal and business life.

Now we have the strategic plan. As is typical of the railway system, it is late in arriving, we are not quite sure in which direction it is going, and there is no indication that it will ever reach its destination. Those of us from the west country who read that compendious document find little to support investment in the west of England. The best expression of any interest in the west country is the glossy picture in the section headed "Conclusions", which shows Bristol Temple Meads station. Unfortunately, there is no train in sight, only a rather nice new bus. That says everything about the services we can expect to receive.

Does the hon. Gentleman not approve of integrated transport?

Yes, I would, if a railway element were included; currently, however, none is.

On Monday, the Secretary of State told us that

"The strategic plan for railways draws a line in the sand and represents the point at which we say enough is enough."—[Official Report, 14 January 2002; Vol. 378, c. 33.]

We agree—enough is enough. However, the amnesia that has afflicted members of the previous Government—as evidenced by the speech of the former Transport Secretary, the right hon. Member for North-West Hampshire (Sir G. Young)—has spread to the current Government. When Ministers talk about decades of underinvestment in the railways, they forget that we have had half a decade of underinvestment under a Labour Government.

Where did all the promises made by the Deputy Prime Minister during his period of responsibility for the railway get us? How did they improve the system? Instead of improvements, the right hon. Gentleman bequeathed a system in chaos to the current Transport Secretary, who now wants to start with a blank sheet. It is a nice trick—if it can be pulled off—to start with a blank sheet half way through a Government, but I doubt that the travelling public will accept that, or that they will judge the Government's performance by any yardstick other than whether their travelling experience improves or continues to deteriorate.

My hon. Friend is rightly highlighting the growing cynicism of a public who were faced with the fuel escalator, which gave huge revenues to the Exchequer but did not result in any investment in the public transport to which they were asked to switch. Now, they have no confidence in the future of the plan. Not only the short-term objective of a decent transport and communications policy, but confidence in our ability to get people off the roads and reduce emissions in accordance with our long-term Kyoto commitments, are being undermined by a Government who have failed to inspire confidence in the future of public transport as a viable alternative to the roads.

My hon. Friend is absolutely right. That is the crux of the matter. If we are to attract people back to public transport and the railway system and get them to leave their cars at home, we must first reverse the disintegration of the railway system that resulted from privatisation and has been continued by the current Government. Secondly, we must create a fair fares structure to encourage people to believe that they can afford to use the railways.

Thirdly, we must secure the infrastructure investment and development that are needed. I have a modest request to make on behalf of my constituency. We have been trying to use the Great Western line to Penzance as a means of providing local services by reopening stations at Somerton, Langport and Witham Friary. Although that reached "feasibility" stage under Railtrack, the plan has now disappeared from the map, which is regrettable.

We need a safe system. I was alarmed by the Secretary of State's comments on the Cullen recommendations for Paddington. Those of us who use the station want to know that Paddington is safe to use, but it appears that the right hon. Gentleman himself does not yet know whether the recommendations that emerged from Cullen have been implemented. That is a disastrous omission on the part of the Secretary of State and his advisers.

My hon. Friend might be even more alarmed to learn that when purportedly giving information about signalling improvements in the Paddington area, the Secretary of State assured the House that the required TPWS—train protection warning system—improvements had been made. My hon. Friend is aware, although the Secretary of State clearly is not, that Lord Cullen made two wholly separate recommendations. We still have not heard about the recommendations on signalling.

That is precisely the case. The Secretary of State does not know whether signalling improvements have been made. He is waiting for the Health and Safety Executive to report—three months late. He is apparently not curious about whether that critically important safety improvement has been made—an improvement that would allow passengers to travel safely into Paddington. That speaks volumes about the Government's priorities.

Privatisation was a terrible adventure for the rail industry. Coupled with underinvestment over a long period, it has had disastrous consequences. The fact remains that the Government were elected five years ago to do better. They have failed to improve the system over that period, and for the public it is now time for delivery or removal.

6 pm

This is the fourth occasion in recent months when Opposition parties have initiated a debate on aspects of the railways. The Conservatives have secured three debates, and the Liberal Democrats have selected the topic for today's debate. I do not think for one minute that anyone in the House would criticise Opposition parties for raising the subject of the railways, because it is clearly an important issue that concerns the public. Many Members experience rail travel in their daily lives.

I suspect, however, that members of the public who have followed the debates in the past few months would not have been impressed by what we have heard from the Opposition parties, such as the Conservative party spokesperson's staggering refusal to explain its policy on the railways. The hon. Member for Maidenhead (Mrs. May) was pressed by my hon. Friend the Member for Croydon, Central (Geraint Davies), and she failed to answer his question about what the Conservatives would do and how much money they would put into the railways. If a member of the Conservative Front-Bench team replies to the debate, perhaps they could at least give us an inkling of Conservative party policy on the railways—how much money it would put in, what it would do about Railtrack as it now stands and whether it supports or opposes the Strategic Rail Authority's 10-year plan. I do not think it too much to ask for the House to be given an inkling of Conservative party policy on the railways.

I listened carefully to the opening speech of the hon. Member for Bath (Mr. Foster). I was genuinely interested to find out about his party's constructive policies on the rail network, but I did not hear too much about that.

The hon. Gentleman may be aware that on 14 February we published our detailed proposals for the future of the railways. We are delighted that the Secretary of State has now adopted some of those proposals on the future of Railtrack. We are hopeful that he will shortly adopt our proposals for the future of the London underground too.

I am obliged to the hon. Gentleman. It seems that the Liberal Democrats support the Government's proposals on Railtrack and the 10-year plan, which makes me wonder why the motion was tabled in such terms. Perhaps the Liberal Democrats should support the Government amendment.

I am sure that the public welcome the fact that the SRA has a 10-year plan, which, together with the Government's 10-year plan, provides a real strategy for improving rail services. Some of the improvements in the rail network that have already been made since the election of a Labour Government have been possible despite the lack of investment in safety and the fragmentation of the network that we inherited.

In a few months, for the first time in 40 years, rail services will return to a line in south-east Edinburgh, where two new stations have been provided with funding from the Scottish Executive and the SRA. Those improvements can be built on under the SRA's plan, and I welcome that strategic plan and the Government's response to it.

Of course many of us would like to expand on the SRA's proposals. We have our own ideas. Because of the nature of the transport sector, it is almost impossible to please everyone all the time, because people have their own strongly held views on this area of policy.

Even in a sector that tends to be critical of initiatives from Governments of whatever colour, there has been a guarded but positive response to the SRA's plan from the industry and from industry commentators. That suggests to me that the SRA is acting on the right lines, at least in broad terms.

Having raised in parliamentary questions and in correspondence my concerns about the future of rail services in and around Edinburgh, I want to put on record my acknowledgement of the response from the SRA and from Ministers to concerns expressed by me, by other hon. Members and by many outside bodies. I welcome the decision announced today on the two-year franchise for GNER. Unlike the hon. Member for North Tayside (Pete Wishart), who has now left the Chamber and has been the only member of the Scottish National party present during the debate, I recognise the benefits that travellers in Scotland and in the rest of the country will enjoy as a result of that two-year extension of the franchise.

My right hon. Friend the Secretary of State listed some of the improvements that have been made. I refer also to the improvements to the diesel train sets, which provide the train service to north-east Scotland and which the hon. Member for North Tayside did not acknowledge in his criticism of the Government.

I particularly welcome the decision to give the go-ahead to the rebuilding of Edinburgh Waverley station, which is essential for the east coast main line upgrade. It is also essential for the planned improvement to local services in the Edinburgh and south-east Scotland area, and is vital for the better development of Edinburgh city centre.

I also welcome the confirmation that the east coast main line upgrade is to be included in the medium-term programme. I note that the SRA will be bringing forward detailed proposals in the near future. That upgrade is vital not just for Edinburgh but for cities and communities along the line from Edinburgh to London. It is vital for tourism, business, leisure travel and freight.

I note that the SRA makes it clear that it will take the lead in the joint venture set up to take forward the east coast main line upgrade. I strongly urge the SRA to ensure that it provides strong leadership, because none of us wants the east coast main line upgrade to be bedevilled by the problems that affected the west coast main line upgrade because of the complexity of the contractual relationships that were necessary to take that project forward.

I welcome many other aspects of the SRA plan. They bring benefits to my constituency and to Scotland as a whole. Even the improvements in the east coast main line outside Scotland will bring benefits to people in Scotland. They travel to London and use trains that start in London. Their trains are affected by delays in the south-east commuter network. Benefits from the upgrade further south will also be felt in Scotland.

There are always more things that can be done and further improvements that can be made. The SRA is right to give a high priority to achievable objectives in the short term, but what I find particularly exciting about its proposals is that it identifies a list of longer-term projects that should be investigated for possible future development. Those projects would revolutionise rail travel in many parts of the country. From my constituency perspective, and as a Member from Scotland, I am excited about the vision of a new north-south, high-speed line, which would offer immense possibilities for leisure, tourism and business travel, would take pressure off the road network and air services, and would also help to bind the United Kingdom together as a concrete embodiment of the benefits to Scotland of our links with England.

I hope that the Minister will favourably consider the proposals for a new high-speed line from the south of England to the north. Such projects require costings and value-for-money analysis, but they also require a leap of faith. I urge the Government to take that leap of faith, and to take the SRA' s lead in developing that idea. What better monument could there be to the Government's commitment to modernising the rail network than to open such a line? It would mean that people in this country would no longer look to the continent for its high-speed, modern services and look in despair at the largely 19th century railway network in this country. I urge the Government to do what they can to take that proposal for a high-speed line further forward at the earliest opportunity.

6.10 pm

I have declared my interests in the Register.

I had hoped that we would have a proper debate on the so-called 10-year plan, which was issued on Monday with such a fanfare and received a pretty disappointing press thereafter. Perhaps we have not done so, other than some interesting detailed observations from Members with constituency interests, because there is so little in the plan before us. Perhaps it has dawned on Labour Members that they have been rather let down.

If we look to the plan for a promise that 140 mph trains will be bought and will operate on the west coast main line, we look in vain. If we look to the plan for a guarantee that the full west coast main line upgrade will go ahead, we see instead that it is subject to review and very likely to be downgraded. If people in my part of the world, the Thames valley, seek the promise of a solution to the problems of conflict and lack of capacity on the lines through Reading into Paddington and Waterloo, they will be answered only with a deafening silence.

There will be no solution to the obvious problem that after a very successful period immediately after privatisation, in which there was a big surge in the usage of the railways, the Government have, during the past five years, failed to make the commitment to invest in the new capacity that is so obviously needed to respond to that successful growth.

We see the schizophrenia on this issue not only in the statements of various Ministers and, as my hon. Friend the Member for Maidenhead (Mrs. May) admirably pointed out, in the contradictory statements made by the Secretary of State, but in the words of the newly appointed chairman of the Strategic Rail Authority. In his foreword to the plan, he points out that privatisation has been a great success, and he draws great comfort from the fact that there has been a 34 per cent. increase in passenger usage of the railways, a 40 per cent. increase in freight and a 20 per cent. increase in train usage of the network.

Is it not the case that the main factor behind that increase is the recent growth of the economy under a Labour Government, and in fact it has nothing to do with privatisation?

I do not accept that, because we had periods of substantial economic growth when the industry was nationalised, and it never succeeded in increasing passengers and freight as it did in the beginning of the railways' remarkable renaissance after privatisation. I know from experience in my own area that we had a strong economy in the late 1980s, and we did not see anything like that growth in passenger usage of the railways in those days. When we introduced privatisation, there was successful growth in the industry—services improved and companies accommodated more passengers. That growth was, rightly, proudly trumpeted by Ministers until recently, and in the plan it is proudly trumpeted by the chairman of the SRA.

The chairman goes on to explain, however, that all is woe on the railways because of the obvious failure, which has been most pronounced in the past five years, to make any response to that success or to make a commitment to the new rail capacity and the investment required to cash in on that success and further expand the railways. The chairman's prose is not particularly elegant, but its meaning is devastating. He says:

"We have to rediscover the service ethos and an accountable delivery culture, rediscover industry-wide investment planning and rediscover how to train, manage and motivate our people so that the team works together like an efficient machine."

This is after five years. It is after the Government introduced their chosen vehicle, the SRA, appointed a boss, gave him his head and then, for some unknown reason, decided to sack him and replace him with someone else.

How long will it take for the Government to get the SRA up and running in the way that they would like? Why is it that, five years in, we hear from their recently appointed nominee this devastating indictment that practically all the measures that the Government said are necessary to perfect privatisation have not been taken because they chose the wrong person and did not get the SRA straight?

Does not the right hon. Gentleman admit that the privatisation introduced by his Government is the reason for the current fragmentation and disjointedness in the rail service to which he is referring? It is not down to people's failure to work in teams; privatisation was flawed and has led to the breaking up of the railways. Under this Government, the SRA is trying to put strategy and vision back into our rail service.

I wish that that were true, but I take the view that the original structure as set out by my right hon. Friend the Member for North-West Hampshire (Sir G. Young), the Transport Secretary at the time, was beginning to work extremely well. There was a great increase in rail usage, but the intervention of the SRA and the Deputy Prime Minister, in his role as Secretary of State for the Environment, Transport and the Regions, completely undermined the working relationships in the industry and put on ice quite a lot of the investment. The Government deliberately stopped investment by refusing to renew or extend franchises for companies that would otherwise have made big investment commitments. They worked away gradually to undermine Railtrack, leading to its administration, as we saw.

The hon. Member for North Durham (Mr. Jones) smiles and he is sure that he is right, but he ought to read the plan because it is a great admission of failure. It is all about the failure of the Government's body, the SRA, which was going to solve the problems that they thought existed but which has clearly made them all worse. The chairman goes on to say in his foreword:

"We will change the way the SRA is structured and managed to deliver this new railway."

Here we are, five years on, and two or three years after the SRA got up and running, and we are told that the body was completely wrong. That is the view of the Government's chosen agent, and the SRA must now be fundamentally restructured. Will the Minister tell us how long that complete restructuring of the SRA will take? How long will it be before the SRA stops looking at itself and engages with the chief executives and chairmen of the private companies running the industry, gets them on side, gets us back to work and gets the industry investing again?

This is not so much a plan as a plan to have a plan. Again, the chairman lets the cat out of the bag in his remarkably forthright foreword. He says that we need one plan, and that is the key target that he has set himself for 2002. This is not the plan; it is a plan to have a plan. The plan is even more delayed than the trains that it is talking about. The Government say that they believe in planning; they set up a body to make a plan; they have two launches of a plan that is not a plan, and they then decide that the latest plan is a plan to have a plan at some unspecified date this year.

It has nice pictures though.

Some of the pictures are quite jolly, but the Government seem to be interested in photographing buses and empty railways because they are rather embarrassed by the shortage of good train shots caused by the cancellation of so many trains due to strikes, absent plans and the failure of investment because franchises have not been renewed in time.

We are told that the Government have embarked on creating a new type of vehicle. They should be rather more honest with their supporters about what is going on. The Secretary of State has been absolutely masterful in leading many of his Back Benchers, who never really liked privatisation, to believe that in some mysterious way he is renationalising the main part of the railways, Railtrack. Some of them are happy because they think that that is what is happening. However, if they read the plan carefully they will be deeply disappointed.

We have a private company that was put into administration by a Secretary of State who wanted to waste taxpayers' money and give far more money to the receiver than he would have had to give the company to keep it flourishing in the private sector. We now have a private company, run by private sector accountants in a private sector administration, which the Government are looking to sell on to another private company in due course. The Government say that they may come up with a new type of private sector bid—a company limited by guarantee that is not for profit—but it will be difficult to attract capital into a venture that makes no money for its shareholders.

From what I have read in the newspapers this week it will be even more difficult to raise bond finance for such a company. I hope that Labour Members understand how serious the matter is. Apparently, a group of convertible bond holders voted against the scheme of arrangement for the bond finance in Railtrack which the Government hoped would go through. The Government are now in an invidious position, and some people believe that they, through the administrator, may not meet all the payments on the debt. If we get into an Argentinian situation with Railtrack bonds, the Government will find it difficult to raise money from the City for a future vehicle, if they manage to construct one that is a front for the Secretary of State.

The Minister has leave, if he wishes, to intervene and assure me that the Government will make every payment on those bonds and guarantee that the bondholders will have all their interest and money repaid. I am happy to give way if he wishes to give that assurance. The fact that he cannot do so and is trying to smile and pretend that it does not matter means that I have touched a sensitive nerve; the Government are trying to launch a company on bond finance but, at the same time, they cannot give a guarantee that they will be any better than the Government of Argentina on a bad day in meeting obligations incurred by a company that has almost become a creature of the state.

The Secretary of State has enormous influence and a lot of responsibility for the railways. He made a big error in putting a private company into private bankruptcy, but now hopes that he can get it back into the private sector. He has underwritten the position, presumably because the Treasury insisted that he do so, by stating, through the chairman in the 10-year plan, that practically all the projects of the new Railtrack will be privately financed; that will be done through public-private partnerships, not private capital. For a long time, I have tried to get the Government to tell the markets and the travelling public their plans for granting money to the new Railtrack, whether it is taken on by a company limited by guarantee, as they wish, or some other private bidder.

That question is not unreasonable; the Government will have to reveal the answer before they can have a competition to get Railtrack moved back into the private sector, up and running and perhaps investing again. Answer came there none until we had the strategic plan, which includes a little clue. It says that out of the £33.5 billion of public money, some £26 billion will subsidise the existing railway, quite a lot of which will be routed through the train operating companies. Only £7.5 billion therefore could conceivably be for Railtrack-type investment over the whole 10-year period, which demonstrates that unless something dramatic happens, there will be a fall in investment in mainline railway activities compared with the poor totals managed in the years prior to privatisation. That is an extremely disappointing outcome, which Ministers should take more seriously.

The chairman of the SRA has a delightful sense of humour. In his foreword, he gives one of his aims:

"I want to see fewer accountants, fewer lawyers and fewer consultants. Instead I want to see more engineers, more operators, more project managers".

To assist the chairman, the Government put all of Railtrack into the tender loving care of a set of accountants in administration, then went off and hired a whole load more consultants, lawyers and accountants to advise the Secretary of State. Railtrack plc, which is in administration, has to have that sort of advice, as does Railtrack Group. It is therefore turning into a field day for a lot of hard-working and intelligent lawyers, accountants and consultants.

I have previously estimated that the total cost of Railtrack administration in lawyers' fees, administrators' fees, accountants and consultants will be more than £100 million. No Minister has ever been prepared to gainsay that figure, and I am now beginning to feel that my expectation is far too modest; the legal complexities, with failed bondholder issues and possible lawsuits from Railtrack group, will be such that millions more pounds could be spent on those fees.

The right hon. Gentleman and I may fundamentally disagree about the ideal future for son of Railtrack, but would he at least agree that he has just made a significant point, which is amplified by the bizarre situation? The administrators Ernst & Young, with all their consultants and advisers, are currently working up a number of alternative models while, at the same time, the Secretary of State is bringing in further advisers to come up with his own preferred model. That will then be put to Ernst & Young which, in turn, will have to put it to the Secretary of State who, at the end of the day, will make the decision and choose his preferred option. Why Ernst & Young is wasting all that time and spending all that money is frankly beyond me.

Perhaps I can help the hon. Gentleman. The Secretary of State is in such a complex and difficult legal position that he has to allow work to continue on other options besides his favoured option. He has to be careful, if he thinks that he can make those decisions himself, not to be conflicted when he comes to make the ultimate judgment. It would be difficult for him if his company limited by guarantee were up and running and had put in a bid, but it was not quite the best bid on the table. If he were behaving honourably, as I am sure that he will, he would have to award the contract to the best bidder. However, if the two bids are dissimilar—if a direct comparison is difficult and it is arguable which is the best bid and which is not so good—he has to make sure that he has avoided any conflict during the process and has given a fair chance to the other bidders. It would be much better if one Minister were the advocate for the company limited by guarantee and someone else made the decision; otherwise the Government could well have even more expensive legal actions on their hands.

For reasons of natural justice, the Government need to be fair-minded, but they must also satisfy a series of legal problems. First, they must demonstrate to the administrators and, through them, the Railtrack shareholders, that the best possible deal has been done for the shareholders, who still have rights. As my hon. Friend the Member for Maidenhead always points out, many of them are railwaymen and many are pensioners living on their pension funds; they are not rich and would like to get something back from this awful mess.

The Secretary of State also has to satisfy European competition law. If it appears that he only ever had in mind one option, which then wins the competition, there could be difficult questions to answer in Brussels and the European Court about whether European competition law had been properly observed. A private sector company is in private sector administration, and has to be properly open for tender and bid. It is also a private sector company with a strong Government interest—the Government are the subsidiser of last resort—and has a strong monopoly position in a particular sector of the British transport market, which means that regulators and lawyers will take a strong interest in it.

We see from the document that an important part of the task of the chairman of the SRA in 2002 is to try to attract private capital for the railways. Hallelujah—that is exactly what is needed. Many Members have said that it is difficult to see how all the money in the modest plan will be drawn in. It is certainly difficult to see how there will be anything but delay in the really big sums needed in 2002 and 2003, given the uncertainties. The problem for the SRA and the Government are the contradictions. They say that 2002 is the year for delivery and the year to bring in private capital, but they are not making the decisions that they need to make today to maximise their chances of attracting that capital.

I put two simple points to the Government; if they seriously want lots of private capital, the first thing that they should do is get Railtrack out of administration and into workable ownership and management as quickly as possible. If reports are true—they may well be—and there is no chance of Railtrack being out of administration before this autumn, and possibly not until next year, we will have wasted more than a year. There can be no effective negotiations on private financing in conjunction with Railtrack because everyone will say, "We need to know who will own the company, what the rules are and what its balance sheet is before we can make an assessment."

The second thing that Ministers should do if they want private capital is settle the franchise position, which they undermined by granting short franchises or delaying franchise renewals. Instead of apologising for that mistake and agreeing proper franchise periods which could lead to those companies making a lot of new investment in new trains, which my constituents and others want, Ministers have compounded their error by saying through the SRA that they now wish to amalgamate franchises. The amalgamation of franchises is not a simple task. It means asset swaps, asset mergers, takeovers; all sorts of complicated corporate finance and legal activity; great complexities in bringing the franchises together under new and existing owners; and sorting out the resulting financial and asset complications, which would result in much more delay. By their decision, the Government have guaranteed a big gap in the order pattern for new trains in many parts of the country while we sort out who will run the franchises and when they will be up and running.

The chairman of the SRA says:

"The clear message … is that the prospects for Britain's railway have never been better."

However, that does not seem to follow from all the other things that he said in his foreword. A few paragraphs earlier, he told us of a state of confusion; the Secretary of State has given him the impossible task of trying to stabilise an industry when the Government are making up policy as they go along. This is the man who is told that most of the money must be from the private sector, but we must not tell the Labour Back Benchers because they think that it will be a public sector operation.

My constituents and I want a big expansion in railway capacity. We want to be able to drive to the station, park in a decent car park with proper security, and find that there is a regular service to London and other important towns in the neighbourhood. We want four or five trains an hour to London, not two or three, as we have at present. I can promise Ministers that there is plenty of business out there if the companies are allowed to get on with it.

I have been asking endlessly for Ministers to give an assurance that a scheme that I have backed, and which is wanted by the local train operating company and the local council, and was wanted by Railtrack before it went into administration, for a new station and better waiting facilities and for work to begin on improving the track, would go ahead despite the administration. There is no such reassurance, and there can be no such reassurance, I fear, because although Ministers have heavy influence and are paying very big bills, they are not in control, nor is the SRA, and they are not driving forward the better railway that we want.

When the story comes to be written in a few years' time of the Secretary of State's decision to put Railtrack into administration, it will go down as one of the biggest bungles in the interface between politics and business over which any Minister has ever presided. We will discover during the next two years that it will have been massively more expensive to have that animal in administration than it would have been to do a deal with a private sector company. We will discover that the Government do really want to get it back into the private sector, because the Chancellor does not want all the money on his Budget for the massively expensive upgrades and improvements in the railway.

We will discover that while the Government and their lawyers, accountants and consultants are busily arguing with each other and trying to protect the Secretary of State against a minefield of legal actions, the travelling public have walked away, bought a load more new cars, and are sitting in traffic jams because they have no choice.

6.32 pm

I have very little time, so I shall make just a few key points. I regret that the Liberal Democrats have chosen to throw barbs at my right hon. Friend the Secretary of State, instead of the brickbats that are due to the Conservatives, who caused all the problems. My right hon. Friend is doing a tremendous job in extremely difficult circumstances. He has my strong support and that of my hon. Friends. I look forward to his success in future years.

The right hon. Member for North-West Hampshire (Sir George. Young), in his own elegant way, put a wonderful gloss on a national transport disaster perpetrated by his Government. We are trying to pick up the pieces—rather belatedly, I think. We should have taken action in the first week of May 1997. We have taken action only now, but we are at least beginning the process, which will be long and difficult.

My right hon. Friend has taken the first necessary step, but he must go a lot further. He should look at the state-owned, integrated national railway systems on the continent, which are light years ahead of our railway system. They are integrated and publicly owned and rely on public investment. We must review the way in which we invest not only in the railways but in other parts of the public sector and question the Treasury rules on borrowing. Many other countries in the European Union park such investment off their public sector borrowing requirement so that they can get inside the borrowing limits of economic and monetary union and the stability and growth pact. They are right to do that and we should follow their example. If they can get away with it, so can we. We could solve many problems in the public sector if we did that.

There are two fundamental problems arising from privatisation—fragmentation, about which we have heard much, and the fact that it is finance driven, not public service driven. I take issue with the right hon. Member for North-West Hampshire, who compared railways with airlines. If airlines have a route that is failing, they take it off. There is no problem. However, we cannot take off the Circle line. It is part of the fundamental infrastructure that is necessary for the functioning of our country, not to mention its capital city. There is a difference between the vital infrastructure of the railway network and airlines, which can change.

We heard reference to Railtrack being the problem, whereas the train operating companies seem to be blameless. According to the strategic plan published this week, the total delays caused by train operators were 43 per cent., and the total delays caused by Railtrack were 42 per cent. so they are equally to blame. We heard today that the train operating companies have serious financial problems. We must look to reintegrate the train operating companies, the track and the engineering work into one integrated railway industry—we must get back to what we had before.

The problem with British Rail was not that it did not work, but that it was starved of finance. If we had invested in British Rail in the way that the continentals have invested in their railways, we might be where they are now. I recently visited SNCF in France and saw developments that we will not see in this country for a decade, even with the best will. I spoke to an SNCF engineer and asked where the finance came from. He said, "In France, when we speak of PPP, we mean public, public, public." I urge my right hon. Friend to consider the possibility of going back to a properly integrated state-owned railway system.

6.35 pm

I thank my hon. Friend the Member for Bath (Mr. Foster) for introducing the debate in his usual forceful and entertaining manner. He painted a bleak but accurate picture of the railways today: train delays up 70 per cent., cancellations up 45 per cent. and overcrowding running at 39 per cent.

My hon. Friend focused on some of the key unanswered questions in relation to Lord Cullen's recommendations, which were due to be implemented by 19 December, and he set out a number of Liberal Democrat proposals which, if adopted, would ensure that the line in the sand drawn by the Transport Secretary would not be washed away by the waves created by the next multi-billion pound infrastructure overrun, or the failure to secure the very high levels of private investment that are needed to deliver his 10-year plan.

Significant contributions were made by other hon. Members, and I shall touch on those briefly. I echo the comments of the Secretary of State about the dedication and commitment of the people who work in the railway industry, and I welcome his honesty about the state of our railways. The hon. Member for Maidenhead (Mrs. May) posed a number of pertinent questions to the Minister, particularly about the cost implications of the fact that Railtrack has been put into administration, and how that will affect the private finance that the Government seek to secure, in relation to both the rail industry and the PPP for London Underground.

The hon. Member for Carlisle (Mr. Martlew) made an interesting bid in support of past Conservative policies to reintroduce a Department of Transport. The right hon. Member for North-West Hampshire (Sir George Young), who is in his place, used a French term—renaissance—to describe the railways under the Conservatives. I would use another French phrase to describe his attitude—"Je ne regrette rien." However, I agree with the right hon. Gentleman's point about contradictions between the Government's policies in relation to rail and to the tube, where the approaches that they have adopted with regard to who runs what are diametrically opposed.

The hon. Member for Preseli Pembrokeshire (Mrs. Lawrence) said that she would make parochial points. There is nothing wrong with that; our constituents often want us to raise matters that are relevant to them. My hon. Friend the Member for Somerton and Frome (Mr. Heath) said that the mud-wrestling at South West Trains must stop, and I agree with him entirely. On Lord Birt's involvement, that is startling.

Does my hon. Friend agree that it is rather odd that Lord Birt has been appointed to his new role? When he was at the BBC, he took a unified structure, split it into little pieces, set them against each other and put a bureaucracy on top. Given that the Tories did that with the privatisation of the railways in the first place, what useful contribution can he now make?

The Transport Secretary stated what Lord Birt's involvement will be. His involvement with the railways is simply to keep him occupied, although I hope he does no damage in the process.

The hon. Member for Edinburgh, North and Leith (Mr. Lazarowicz) wanted to know more about Liberal Democrat policies. Several of his hon. Friends are consulting our paper "Transport for People", so I advise the hon. Gentleman to speak to them about that.

I have indeed examined "Transport for People", which has a very catchy title. I congratulate the Liberal Democrats on specifying—although they have not used any figures—where they would get some of the extra investment that they propose. The proposals include congestion charging and workplace parking taxation. Does the hon. Gentleman accept that that will be a revelation to Liberal Democrats in my constituency, who have been criticising the Labour party for allegedly taxing motorists off the road?

I thank the hon. Gentleman for his intervention, although I had hoped that it would be slightly shorter. The Liberal Democrats are happy to let local communities make their own decisions on congestion charging.

I agreed with the comments of the right hon. Member for Wokingham (Mr. Redwood) about the plan. If there is anything in it, it is simply reheated existing policies. It is certainly long overdue. He will not tempt me, however, into talking about Argentina's economy—a matter for another debate. The hon. Member for Luton, North (Mr. Hopkins) said that there was a difference between aviation and the Circle line, as one cannot shut down the Circle line, but I am afraid that London Underground currently does that far too frequently and easily.

In the remaining few minutes, I should like to concentrate on two matters that have not been discussed in any detail: the supply of power to trains and carriages, and the future of London Underground. If the issue of power is not resolved, it is extremely unlikely that the Transport Secretary will be able to deliver his plans. We know that the SRA strategy has announced 1,700 new trains, although they are not really new trains and this is not news, as they have been on order for some time and their delivery is already way behind schedule. Some 2,019 new carriages have been ordered, but only 195 have so far been delivered. The train operating companies will have to get 12 of the vehicles into service every week. Will the Minister tell us how the Government will ensure that they do so? That target sounds extremely ambitious.

None the less, when and if the trains are delivered, they will need a power supply. The arrangements in Railtrack southern region are in disarray. It is thought that the power network cannot be upgraded there by the deadline of the end of 2004. It appears that many millions of pounds have been spent on trains that cannot be used for a number of years. Who is responsible for the blunder? According to the Secretary of State, it is pre-administration Railtrack. However, Modern Railways magazine disagrees. It believes that Railtrack simply did not have enough notice to upgrade the power supply in time. As I said, that means that the commitment of £1 billion-plus on new carriages and trains could be jeopardised, as those trains will not be able to run on the system once they are available. Southern region representatives say that it will take at least another six months before even the scale of the upgrade is known. Additional work needs to be done in respect of 630 substations and so on. Apparently, the equipment could be ready for that, but there is a significant problem—I know that the Secretary of State is aware of it—in terms of the manpower that will be needed to do the work.

Will the Minister tell us whether he believes that that is a failure of Railtrack, as the Secretary of State said, or of the train operating companies or, as Modern Railways suggests, the Strategic Rail Authority and possibly the Department for Transport, Local Government and the Regions? I await his response. I hope that he will answer a very simple question: will the power be ready at the right time and in the right place to allow all the trains to run when they are available for service? A simple yes or no will do.

The second issue on which I want to focus is the London underground. Many hon. Members are as perplexed as I am about the fact that the Government appear to be committed to recreating on the London underground many of the structural failures that we have seen on the railways. Indeed, they are almost building in the same faultline. Furthermore, the tube PPP has many other faults. One of my main concerns is the almost excessive secrecy and commercial confidentiality that have been involved, which seems incompatible with the democratic need for accountability. That has led to some disturbing incidents.

In 1999, the Deputy Prime Minister said that a £4.5 billion saving would be achieved through the PPP. Since he made that statement, I have been trying to pin the Department down on the subject. I received a response on 14 November 2001 telling me that the £4.5 billion figure was meant only to "inform the debate". Can we really believe any of the figures that are spouted by the Government, or must we assume that they are all about spin and have no financial substance? The obsession with commercial confidentiality means that we have to rely on the media to find out—we hope—about the state of the PPP.

Does the hon. Gentleman realise that if the rumours are true and the Government have become bored with the PPP and do not think it can work, massive cancellation fees will have to be paid to the unsuccessful bidding parties, on top of the £100 million that has already been incurred in advisory fees?

I have pursued the Government on that subject, but they have been unable to supply me with information about the additional costs not only of consultants but of the whole process.

As I have only one minute in which to conclude my remarks, I return to the motion and our proposal to dock the Transport Secretary's pay on the grounds of poor performance. Part of the remuneration of the chairman of the Strategic Rail Authority, who has just been appointed by the Government, is received in a bonus, and train operating company managers are also paid by results, so I think it is entirely fitting that the Transport Secretary's pay should also be performance related. To date, his achievements are less than remarkable. As I said at the very start of my speech, train delays are up by 70 per cent., cancellations are up by 45 per cent. and overcrowding is running at 39 per cent. The right hon. Gentleman is presiding over a rail system that is on the verge of collapse. Madam Deputy Speaker, it is fortunate for him that we have a minimum wage, because his performance to date warrants nothing more.

6.47 pm

I do not know whether the hon. Gentleman's comment was in the same league as a remark made by a departed colleague, Simon Mahon, a long-standing member of Bootle council who prefaced his peroration in the Chamber, "Finally, Mr. Mayor." I am sure that you will let the comment pass with your usual graciousness, Madam Deputy Speaker.

Fortunately for you, Madam Deputy Speaker, you did not have to sit through the debate. This was not a great parliamentary occasion. Indeed, the motion set the tone for the debate. No answers and no policies were given by Opposition Members. There was also considerable confusion. My hon. Friend the Member for Newcastle-under-Lyme (Paul Farrelly) drew attention to the Liberal Democrats' policy of paying for the railways out of congestion charges and workplace parking charges. Their spokesman answered that it was their policy to let local communities make their own decisions on congestion charging. Perhaps they will not accept my suggestion that that is not exactly the firmest base for financing the national railway system, let alone that there might be some disparity between the two.

is the Minister really suggesting that the national railway system should be financed through local congestion charging schemes?

Of course not; I was citing paragraph 317 of the Liberal Democrat document. If the Liberal Democrats have their way, it will be difficult to fund anything out of congestion charges. My hon. Friend the Member for Newcastle-under-Lyme suggested that there were local differences, so I checked today. I asked whether any Liberal Democrat councils were progressing with proposals on congestion charging. For once, the right hon. Member for Wokingham (Mr. Redwood) is right: the answer is none. I am willing to stand corrected, but as far as I know, no Liberal Democrat-controlled authorities are pushing for congestion or workplace charging in their areas. There is a slight hole not only in their policy but in their finances.

The Minister is right; I know of no Liberal Democrat-run council that currently proposes congestion charging. However, in London, where the first scheme is most likely to take place, the Liberal Democrats are backing it, unlike Labour members of the Greater London Authority, who refuse to support a proposal that was introduced by a national Labour Government.

I understand that Liberal Democrats are happy to jump on someone else's bandwagon whenever possible, but taking responsibility is different; that is why the motion contains no details about their policy or any alternatives. We are considering a franchise party, which has a rag bag of policies. I note that the hon. Member for Shrewsbury and Atcham (Mr. Marsden) is not here today; he is continuing the habits that he had when he was a Labour Member. What other party that believes in increasing fuel prices would welcome into its ranks the only Labour Member who said that we should have given in to the fuel protesters and cut fuel prices? What a shower!

The hon. Member for Kingston and Surbiton (Mr. Davey) issued a rail users survey. He asked what we should do about it. I expected him to present a policy.

I put forward Liberal Democrat policy.

Let us consider Liberal Democrat policy. Liberal Democrat Members believe that the company that runs the trains should also be responsible for the tracks and signalling. However, their document states that their proposed form of Railtrack should take care of the tracks and signalling. Their policy is, "Tell us what you want, and we will propose it." However, they did not propose much tonight. There was therefore some confusion on the Liberal Democrat Benches.

Before I consider the rest of the Opposition, I want to refer to the positive and thoughtful speech of my hon. Friend the Member for Carlisle (Mr. Martlew). He has long played a positive role with regard to the west coast main line and he drew attention to some of the genuine problems that have to be faced. I shall deal with their origin shortly. He mentioned potential conflict between express, local and freight trains.

The hon. Member for Maidenhead (Mrs. May) made the same point, although her surprising conclusion was that proposals for one operator for each London terminal would exacerbate the problem. It is generally agreed in the industry that those proposals would improve matters. We are prepared to consider the problems that she believes might arise, because doing that, and examining the way in which we create extra capacity, can lead to their resolution.

My hon. Friend the Member for Carlisle rightly identified the skills shortage in the industry, much of which was created by management failures at the time of privatisation. For example, the train operators made approximately 1,000 drivers redundant. The results have been only too clear in recent weeks. The same applies to track engineers. Much expertise left Railtrack; in some cases, it went to the subcontractors, but in others it left the industry. According to the Railtrack mantra of the times, skill and expertise in the industry were perceived as a cost which had to be driven out. Instead of regarding the skills base and the experience as an asset, Railtrack viewed them as costs to be reduced.

I was slightly surprised and disappointed by the contributions of the right hon. Members for North-West Hampshire (Sir George Young) and for Wokingham (Mr. Redwood), who were joined at one stage by another old lag, the right hon. and learned Member for Rushcliffe (Mr. Clarke). They presided over doubling the national debt in five years, adding £175 billion to it. That constituted a huge burden on future generations and an enormous problem that the Government had to solve. We have done that. Conservative Members often talk about the confidence of financial institutions and the City. The financial community probably has more confidence in a party and a Government who have put the national finances on an even keel than a party that doubled the national debt in only five years.

The right hon. Member for North-West Hampshire identified one of the difficulties. He said that Gerald Corbett had resigned and that Railtrack had lost the City's confidence. That was a charitable admission that Railtrack's problems had long and deep roots in its senior management. Contrary to the scare stories that some newspapers are publishing, the majority of the reduction in the value of the shares—from nearly £18 to £2.80—happened as a result of the judgment of the markets on Railtrack's management. Not once did Opposition Members give the slightest indication of what they would have done with a Railtrack that was failing organisationally and financially.

Railtrack management approached our predecessors in the Department in April and secured a commitment of some £1.5 billion. That was honoured. However, the company returned in July and claimed that without new and additional money, it would not be able to describe itself as a going concern.

Will the Minister give way?

I shall give way if the right hon. Gentleman tells us what he would have said to Railtrack managers came back with a begging bowl, in the words of the regulator, in only a few months.

Anyone sensible would have sat down with Railtrack's management, haggled, negotiated and Worked out what the Government wanted to secure in terms of strengthening the board and in return for promises of money, and provided the money. The Government had already promised some money. A deal then would have been billions of pounds cheaper than their current actions.

The right hon. Gentleman claims we should have done a deal with that company when we had sat down, negotiated, haggled and done a deal with its representatives in April, only for it to return in a few months—not influenced by Hatfield or any other event—to say that the money was not enough and that it had no idea about the amount of the final bill. Not only Ministers, but others in the industry judged that Railtrack had no control over its costs. That was apparent on the west coast main line. The hon. Member for Brentwood and Ongar (Mr. Pickles) asked about that line, on which the costs rose by some £2.3 billion to more than £7 billion.

rose—

The Opposition did not mention John Armitt, the new chairman of Railtrack. He is a highly respected civil engineer, who is pulling things round. Although the right hon. Member for Wokingham sneered at the appointment of Richard Bowker to the SRA, I believe that the new team will provide a new vision for the industry.

I have said a number of times in previous debates that the Tories were not only unfit to be the Government but unfit to be the Opposition. I suppose that meant that there was a vacancy for an Opposition. Well, it was certainly not filled today by the Liberal Democrats.

rose—

Order. The Minister is obviously not going to give way.

The only party dealing seriously with transport is the Labour party, and that is why I have no hesitation in calling for the rejection of the Liberal Democrat motion and the carrying of the Government amendment.

Question put, That the original words stand part of the Question:—

The House divided: Ayes 207, Noes 339.

Division No. 134]	[7 pm
AYES
Ainsworth, Peter (E Surrey)	Beggs, Roy
Allan, Richard	Beith, Rt Hon A J
Amess, David	Bellingham, Henry
Ancram, Rt Hon Michael	Bercow, John
Arbuthnot, Rt Hon James	Beresford, Sir Paul
Atkinson, David (Bour'mth E)	Boswell, Tim
Atkinson, Peter (Hexham)	Brady, Graham
Bacon, Richard	Brake, Tom
Baker, Norman	Brazier, Julian
Baldry, Tony	Breed, Colin
Barker, Gregory	Browning, Mrs Angela
Baron, John	Bruce, Malcolm
Barrett, John	Burnett, John

Burns, Simon	Jack, Rt Hon Michael
Burnside, David	Jackson, Robert (Wantage)
Burstow, Paul	Jenkin, Bernard
Burt, Alistair	Johnson, Boris (Henley)
Cable, Dr Vincent	Keetch, Paul
Calton, Mrs Patsy	Kennedy, Rt Hon Charles (Ross Skye & Inverness W)
Cameron, David
Campbell, Gregory (E Lond'y)	Key, Robert
Campbell, Rt Hon Menzies (NE Fife)	Kirkbride, Miss Julie
	Kirkwood, Archy
Carmichael, Alistair	Knight, Rt Hon Greg (E Yorkshire)
Cash, William	Laing, Mrs Eleanor
Chapman, Sir Sydney (Chipping Barnet)	Lait, Mrs Jacqui
	Lamb, Norman
Chidgey, David	Lansley, Andrew
Chope, Christopher	Leigh, Edward
Clappison, James	Liddell-Grainger, Ian
Clarke, Rt Hon Kenneth (Rushcliffe)	Lidington, David
	Lilley, Rt Hon Peter
Clifton-Brown, Geoffrey	Luff, Peter
Collins, Tim	McIntosh, Miss Anne
Conway, Derek	MacKay, Rt Hon Andrew
Cormack, Sir Patrick	Maclean, Rt Hon David
Cotter, Brian	McLoughlin, Patrick
Cran, James	Malins, Humfrey
Curry, Rt Hon David	Marsden, Paul (Shrewsbury)
Davey, Edward (Kingston)	Mates, Michael
Davies, Quentin (Grantham)	Maude, Rt Hon Francis
Davis, Rt Hon David (Haltemprice)	Mawhinney, Rt Hon Sir Brian
Djanogly, Jonathan	May, Mrs Theresa
Dodds, Nigel	Mercer, Patrick
Dorrell, Rt Hon Stephen	Mitchell, Andrew (Sutton Coldfield)
Doughty, Sue	Moore, Michael
Duncan, Alan (Rutland & Melton)	Moss, Malcolm
Duncan Smith, Rt Hon Iain	Murrison, Dr Andrew
Evans, Nigel	Oaten, Mark
Ewing. Annabelle	O'Brien, Stephen (Eddisbury)
Fabricant, Michael	Öpik, Lembit
Fallon, Michael	Osborne, George (Tatton)
Field, Mark (Cities of London)	Ottaway, Richard
Flight, Howard	Page, Richard
Forth, Rt Hon Eric	Paice, James
Foster, Don (Bath)	Paterson, Owen
Francois, Mark	Pickles, Eric
Garnier, Edward	Portillo, Rt Hon Michael
George, Andrew (St Ives)	Price, Adam
Gibb, Nick	Prisk, Mark
Gidley, Sandra	Pugh, Dr John
Gillan, Mrs Cheryl	Redwood, Rt Hon John
Gray, James	Reid, Alan (Argyll & Bute)
Grayling, Chris	Rendel, David
Green, Damian (Ashford)	Robathan, Andrew
Green, Matthew (Ludlow)	Robertson, Angus (Moray)
Greenway, John	Robertson, Hugh (Faversham)
Grieve, Dominic	Robertson, Laurence (Tewk'b'ry)
Gummer, Rt Hon John	Robinson, Mrs Iris (Strangford)
Hague, Rt Hon William	Robinson, Peter (Belfast E)
Hammond, Philip	Roe, Mrs Marion
Hancock, Mike	Ruffley, David
Harris, Dr Evan (Oxford W)	Salmond, Alex
Harvey, Nick	Sanders, Adrian
Hawkins, Nick	Shephard, Rt Hon Mrs Gillian
Hayes, John	Shepherd, Richard
Heald, Oliver	Simmonds, Mark
Heath, David	Simpson, Keith (Mid-Norfolk)
Heathcoat-Amory, Rt Hon David	Smith, Sir Robert (W Ab'd'ns)
Hendry, Charles	Smyth, Rev Martin (Belfast S)
Hermon, Lady	Soames, Nicholas
Hoban, Mark	Spelman, Mrs Caroline
Hogg, Rt Hon Douglas	Spicer, Sir Michael
Holmes, Paul	Spink, Bob
Horam, John	Spring, Richard
Howard, Rt Hon Michael	Stanley, Rt Hon Sir John
Howarth, Gerald (Aldershot)	Streeter, Gary
Hughes, Simon (Southwark N)	Stunell, Andrew
Hunter, Andrew	Swayne, Desmond

Swire, Hugo	Weir, Michael
Syms, Robert	Whittingdale, John
Tapsell, Sir Peter	Widdecombe, Rt Hon Miss Ann
Taylor, John (Solihull)	Wiggin, Bill
Taylor, Matthew (Truro)	Wilkinson, John
Taylor, Dr Richard (Wyre F)	Willetts, David
Taylor, Sir Teddy	Williams, Hywel (Caernarfon)
Thomas, Simon (Ceredigion)	Williams, Roger (Brecon)
	Willis Phil
Thurso, John	Wilshire David
Tonge, Dr Jenny	Winterton Mrs Ann (Congleton)
Trend, Michael	Winterton, Nicholas (Macclesfield)
Turner, Andrew (Isle of Wight)	Wishart, Pete
Tyler, Paul	Young, Rt Hon Sir George
Viggers, Peter	Younger-Ross, Richard
Walter, Robert
Waterson, Nigel	Tellers for the Ayes:
Watkinson, Angela	Bob Russell and
Webb, Steve	Mrs. Annette L. Brooke.

NOES
Abbott, Ms Diane	Clelland, David
Ainger, Nick	Coaker, Vernon
Ainsworth, Bob (Cov'try NE)	Coffey, Ms Ann
Alexander, Douglas	Cohen, Harry
Allen, Graham	Colman, Tony
Anderson, Rt Hon Donald (Swansea E)	Connarty, Michael
	Cook, Rt Hon Robin (Livingston)
Anderson, Janet (Rossendale)	Corbyn, Jeremy
Armstrong, Rt Hon Ms Hilary	Corston, Jean
Atherton, Ms Candy	Cousins, Jim
Atkins, Charlotte	Crausby, David
Bailey, Adrian	Cruddas, Jon
Baird, Vera	Cryer, John (Hornchurch)
Banks, Tony	Cummings, John
Barnes, Harry	Cunningham, Rt Hon Dr Jack (Copeland)
Battle, John
Bayley, Hugh	Cunningham, Jim (Cov'try S)
Beard, Nigel	Cunningham, Tony (Workington)
Beckett, Rt Hon Margaret	Curtis-Thomas, Mrs Claire
Begg, Miss Anne	Dalyell, Tam
Bell, Stuart	Darling, Rt Hon Alistair
Bennett, Andrew	Davey, Valerie (Bristol W)
Benton, Joe	David, Wayne
Berry, Roger	Davidson, Ian
Best, Harold	Davies, Rt Hon Denzil (Llanelli)
Betts, Clive	Davies, Geraint (Croydon C)
Blackman, Liz	Davis, Rt Hon Terry (B'ham Hodge H)
Blears, Ms Hazel
Blizzard, Bob	Dawson, Hilton
Blunkett, Rt Hon David	Dean, Mrs Janet
Boateng, Rt Hon Paul	Dhanda, Parmjit
Bradley, Rt Hon Keith (Withington)	Dismore, Andrew
Bradley, Peter (The Wrekin)	Dobbin, Jim
Brennan, Kevin	Dobson, Rt Hon Frank
Browne, Desmond	Donohoe, Brian H
Bryant, Chris	Doran, Frank
Buck, Ms Karen	Dowd, Jim
Burgon, Colin	Drew, David
Byers, Rt Hon Stephen	Drown, Ms Julia
Caborn, Rt Hon Richard	Dunwoody, Mrs Gwyneth
Cairns, David	Eagle, Angela (Wallasey)
Campbell, Alan (Tynemouth)	Eagle, Maria (L'pool Garston)
Campbell, Mrs Anne (C'bridge)	Edwards, Huw
Campbell, Ronnie (Blyth V)	Ellman, Mrs Louise
Casale, Roger	Ennis, Jeff
Cawsey, Ian	Etherington, Bill
Challen, Colin	Farrelly, Paul
Chaytor, David	Field, Rt Hon Frank (Birkenhead)
Clapham, Michael	Fitzpatrick, Jim
Clark, Mrs Helen (Peterborough)	Fitzsimons, Mrs Lorna
Clark, Dr Lynda (Edinburgh Pentlands)	Flint, Caroline
	Flynn, Paul
Clark, Paul (Gillingham)	Follett, Barbara
Clarke, Rt Hon Tom (Coatbridge)	Foster, Rt Hon Derek
Clarke, Tony (Northampton S)	Foster, Michael (Worcester)

Foster, Michael Jabez (Hastings)	Liddell, Rt Hon Mrs Helen
Foulkes, George	Linton, Martin
Francis, Dr Hywel	Lloyd, Tony
Gapes, Mike	Love, Andrew
Gardiner, Barry	Lucas, Ian
George, Rt Hon Bruce (Walsall S)	Luke, Iain
Gilroy, Linda	Lyons, John
Godsiff, Roger	McAvoy, Thomas
Goggins, Paul	McCabe, Stephen
Griffiths, Jane (Reading E)	McCafferty, Chris
Griffiths, Nigel (Edinburgh S)	McCartney, Rt Hon Ian
Griffiths, Win (Bridgend)	MacDonald, Calum
Grogan, John	MacDougall, John
Hain, Rt Hon Peter	McFall, John
Hall, Mike (Weaver Vale)	McGuire, Mrs Anne
Hall, Patrick (Bedford)	McIsaac, Shona
Hamilton, David (Midlothian)	McKechin, Ann
Hamilton, Fabian (Leeds NE)	McKenna, Rosemary
Hanson, David	Mackinlay, Andrew
Harris, Tom (Glasgow Cathcart)	McNamara, Kevin
Havard, Dai	McNulty, Tony
Healey, John	MacShane, Denis
Henderson, Ivan (Harwich)	Mactaggart, Fiona
Hendrick, Mark	McWilliam, John
Hepburn, Stephen	Mallaber, Judy
Heppell, John	Mandelson, Rt Hon Peter
Hesford, Stephen	Mann, John
Hewitt, Rt Hon Ms Patricia	Marris, Rob
Heyes, David	Marsden, Gordon (Blackpool S)
Hill, Keith	Marshall, David (Shettleston)
Hinchliffe, David	Marshall, Jim (Leicester S)
Hoey, Kate	Marshall-Andrews, Robert
Hood, Jimmy	Martlew, Eric
Hope, Phil	Meale, Alan
Hopkins, Kelvin	Merron, Gillian
Howarth, Rt Hon Alan (Newport E)	Miliband, David
Howarth, George (Knowsley N)	Miller, Andrew
Howells, Dr Kim	Mitchell, Austin (Gt Grimsby)
Hoyle, Lindsay	Moffatt, Laura
Hughes, Beverley (Stretford)	Mole, Chris
Hughes, Kevin (Doncaster N)	Moonie, Dr Lewis
Humble, Mrs Joan	Moran, Margaret
Hurst, Alan	Morgan, Julie
Hutton, Rt Hon John	Mullin, Chris
Iddon, Dr Brian	Munn, Ms Meg
Illsley, Eric	Murphy, Denis (Wansbeck)
Jackson, Glenda (Hampstead)	Murphy, Jim (Eastwood)
Jackson, Helen (Hillsborough)	Murphy, Rt Hon Paul (Torfaen)
Jenkins, Brian	Naysmith, Dr Doug
Johnson, Alan (Hull W & Hessle)	Norris, Dan
Johnson, Miss Melanie (Welwyn Hatfield)	O'Brien, Bill (Normanton)
	O'Brien, Mike (N Warks)
Jones, Jon Owen (Cardiff C)	O'Hara, Edward
Jones, Kevan (N Durham)	Olner, Bill
Jones, Martyn (Clwyd S)	O'Neill, Martin
Joyce, Eric	Organ, Diana
Kaufman, Rt Hon Gerald	Osborne, Sandra (Ayr)
Keeble, Ms Sally	Owen, Albert
Keen, Alan (Feltham & Heston)	Palmer, Dr Nick
Keen, Ann (Brentford & Isleworth)	Pearson, Ian
Kemp, Fraser	Picking, Anne
Khabra, Piara S	Pickthall, Colin
Kidney, David	Pike, Peter
Kilfoyle, Peter	Plaskitt, James
King, Andy (Rugby & Kenilworth)	Pollard, Kerry
King, Ms Oona (Bethnal Green)	Pond, Chris
Knight, Jim (S Dorset)	Pope, Greg
Kumar, Dr Ashok	Pound, Stephen
Ladyman, Dr Stephen	Prentice, Gordon (Pendle)
Lammy, David	Prescott, Rt Hon John
Lawrence, Mrs Jackie	Prosser, Gwyn
Laxton, Bob	Purchase, Ken
Lazarowicz, Mark	Purnell, James
Leslie, Christopher	Quin, Rt Hon Joyce
Levitt, Tom	Rammell, Bill
Lewis, Ivan (Bury S)	Rapson, Syd

Raynsford, Rt Hon Nick	Stuart, Ms Gisela
Reed, Andy (Loughborough)	Sutcliffe, Gerry
Robertson, John (Glasgow Anniesland)	Tami, Mark
	Taylor, Rt Hon Ann (Dewsbury)
Robinson, Geoffrey (Cov'try NW)	Taylor, Ms Dari (Stockton S)
Roche, Mrs Barbara	Taylor, David (NW Leics)
Rooney, Terry	Thomas, Gareth (Clwyd W)
Ross, Ernie	Thomas, Gareth R (Harrow W)
Roy, Frank	Timms, Stephen
Ruane, Chris	Tipping, Paddy
Ruddock, Joan	Todd, Mark
Russell, Ms Christine (Chester)	Touhig, Don
Salter, Martin	Trickett, Jon
Sarwar, Mohammad	Truswell, Paul
Savidge, Malcolm	Turner, Dennis (Wolverh'ton SE)
Sawford, Phil	Turner, Dr Desmond (Kemptown)
Sedgemore, Brian	Turner, Neil (Wigan)
Sheerman, Barry	Twigg, Derek (Halton)
Sheridan, Jim	Twigg, Stephen (Enfield)
Shipley, Ms Debra	Tynan, Bill
Short, Rt Hon Clare	Vaz, Keith
	Vis, Dr Rudi
Simon, Siôn	Walley Ms Joan
Simpson, Alan (Nottingham S)	Ward, Ms Claire
Skinner, Dennis	Wareing, Robert N
Smith, Rt Hon Andrew (Oxford E)	Watson, Tom
Smith, Angela (Basildon)	Watts, David
Smith, Rt Hon Chris (Islington S)	White, Brian
Smith, Geraldine (Morecambe)	Whitehead, Dr Alan
Smith, Jacqui (Redditch)	Wicks, Malcolm
Smith, Llew (Blaenau Gwent)	Williams, Mrs Betty (Conwy)
Soley, Clive	Winnick, David
Southworth, Helen	Winterton, Ms Rosie (Doncaster C)
Spellar, Rt Hon John	Wood, Mike
Squire, Rachel	Woodward, Shaun
Starkey, Dr Phyllis	Worthington, Tony
Steinberg, Gerry	Wray, James
Stevenson, George	Wright, David (Telford)
Stewart, David (Inverness E)	Wright, Tony (Cannock)
Stewart, Ian (Eccles)	Wyatt, Derek
Stinchcombe, Paul
Stoate, Dr Howard	Tellers for the Noes:
Strang, Rt Hon Dr Gavin	Mr. Phil Woolas and
Straw, Rt Hon Jack	Mr. Graham Stringer.

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith, pursuant to Standing Order No. 31 (Questions on amendments), and agreed to.

MADAM DEPUTY SPEAKER forthwith declared the main Question, as amended, to be agreed to.

Resolved,

That this House believes that the railway infrastructure was badly damaged by decades of underinvestment and a flawed privatisation; recognises that the Government made tough decisions in the first two years of the last Parliament to deliver the economic stability that means it can put record levels of investment into the railways; notes that annual average total investment in rail over the 10 year plan will be £4.3 billion, compared to £1.4 billion for the period 1989/901–996/97; congratulates the Government on its decisive action over Railtrack, so undoing a failed Conservative privatisation; welcomes the SRA's Strategic Plan that sets out an effective agenda for the railways; calls for the resolution of the present industrial disputes through negotiation not strike action; and believes that the steps taken have laid the groundwork for a railway system that will be fit for the 21st century.

Care System

Will Members please leave the Chamber as quickly and quietly as possible? We now come to the debate on the state of the care system. Mr. Speaker has selected the amendment in the name of the Prime Minister.

7.15 pm

I beg to move,

That this House believes that the underfunding of social care by successive Governments has led to bottlenecks and delays in the NHS, reducing health care capacity and increasing waiting times; further believes that it is the most vulnerable elderly who suffer the consequences of inadequate care; regrets that the piecemeal approach of the Government to hospital delayed discharge simply shifts the pressures from one part of the care system to another; condemns the Government for its mishandling and misunderstanding of the care home sector and the consequent loss of homes and beds; regrets that the failure to adequately fund social care has produced serious staff shortages and reduced choice and quality for those in need of care; and calls on the Government to undertake a whole system review of funding for social care to tackle staff shortages, increase capacity, promote choice and ensure that people get the right care at the right time.

I am pleased that my hon. Friends and others are staying for this important debate on the state of the care system and the crisis in it. The national health service is always in the news, but the Government often overclaim for it and for their delivery. In fact, it frequently under-performs. As with the railways, they have been too timid and from day one they failed to invest in our health care and our health systems.

The results of that are there for all too see: long waits in our accident and emergency departments, more people waiting for treatment, more people waiting to get out of hospital after being treated. The NHS is short-staffed and struggling to deliver, but it is only part of the picture. Step back and take a look at the bigger picture—the care system outside our hospitals. The Cinderella status given to social care and the failure to invest in the care system are fuelling the pressures on accident and emergency departments and hospital wards.

There are countless victims of this Government's failure to invest in the care system—every year, 700,000 elderly people find themselves stuck in hospital and unable to leave because there is not enough care provision outside. Grotesquely, elderly people are left in hospital waiting for someone to die in a care home before the council will fund their care home place. In parts of the country, two people have to die before one new care place is funded. People are labelled bed blockers as if it is their fault that they are stuck in hospital. It is the Government's fault, but those 700,000 are just the tip of the iceberg.

My hon. Friend refers to "bed blockers" and suggests that the Government blame elderly people for being in those beds. Should not we use the expression "bed lockers", because it is the lack of Government funding that ties elderly people to beds?

My hon. Friend makes a fair point. As a consequence of the Government's failure to invest in social care and the care system outside our hospitals, there is increasing gridlock in the care system. As a consequence of that, people are suffering and receiving bad care.

What is happening to people waiting for treatment? We know that in the five years since the Government came to power at least 5,000 years of bed time have been lost to the NHS as a result of delayed discharges. Who pays the price for that incompetence—5,000 years of time wasted? In the first quarter of this year alone, 22,000 more people could have been treated if the care system did not leave people stuck in bed once they are well. If we managed to treat those people in the health service and get them out quicker, we would be able to reduce or perhaps remove the need for them to fly abroad or rely on private health care for treatment.

Madam Speaker, looking at the figures for the first quarter—

Madam Deputy Speaker.

Maybe in the future. Let us guess how many operations have been cancelled in the first quarter of this year. For want of an NHS bed and appropriate treatment, 20,000 people had their operations cancelled.

I have listened carefully to the hon. Gentleman's argument. Although the Government are open to criticism for the way in which they fund social services authorities, does he not agree that some authorities hardly assist in ending bed blocking? For example, the Rev. David Barker of Nettlestone in my constituency is concerned that the Isle of Wight council, which is of course led by the Liberal Democrats, is not providing the necessary support for people who are sent home, so they are left in beds.

It is a great pity that the hon. Gentleman is not backing his council to make sure that it has the resources to do the job. It will be noted in the Isle of Wight that he is not standing up for the Isle of Wight to ensure that it has the resources; many of his hon. Friends do defend their social services departments.

Will the hon. Gentleman give way?

No, the hon. Gentleman has made his point. [Interruption.]

Order. I am afraid that the hon. Gentleman has made it clear that he is not giving way for a second time.

I am afraid that the hon. Gentleman may not have liked the answer, but that is the answer he is going to get.

There is a chronic shortage of staff and a substantial loss of care home beds, and care increasingly is being rationed. These are the hallmarks of a Government who have neglected the care system. Last year the King's Fund report "Future Imperfect" warned the Government of the increasing difficulty in recruiting and retaining staff, with vacancy rates in excess of 20 per cent. and turnover rates in excess of 16 per cent. It is no wonder that some home care agencies have hit crisis point and have gone out of business.

Before my hon. Friend leaves the causes of bed blocking and the subject of social services departments, does he agree that there has been a gross neglect of district nursing services by all health authorities in recent years? District nurses are getting older and unable to cope. People are not going into the profession, because of the pay and conditions. However, they are crucial to relieving bed blocking from hospitals.

District nurses are an essential part of the team that is needed in the community to facilitate appropriate and prompt discharge from hospital. In too many places, as my hon. Friend has rightly said, they are not there in the numbers needed to do the job.

Added to that is the issue of the new standards for domiciliary care and the fact that a high proportion of home care workers are not far off retirement. As a result, things are set to get worse before they get better in that sector. The same difficulties beset the care home sector.

My hon. Friend is being extremely generous in giving way. Before he leaves the subject of the domiciliary sector, is there not now a real problem in recruiting domiciliary assistants not only in the public sector, but in the private and voluntary sectors? Is it not the case that the standard spending assessment for personal social services across the country fails to deal adequately with that problem this year, which means that the situation can only get worse?

My hon. Friend is right, and I wish to refer to the social services SSAs in due course.

I was about to say that the same difficulties beset the care homes sector. The Association of Residential Care said recently:

"With some supermarkets offering £8 per hour to stock shelves overnight it is hard to attract staff to a complex and often stressful job for much less money. In some parts of the country the only people applying for vacancies are those that Mcdonald's and Tesco have already rejected."

It is a frightening thought that our care homes are so dependent on the rejects from McDonald's.

Staff shortages are no excuse for a minority of care homes that resort to the restraint and chemical management of residents instead of offering decent care. The Local Government Association has warned the Government about staff shortages: in particular, the vacancies of about 10 per cent. in management posts which have led to a cycle of heavy workloads, low morale, long hours and high staff turnover.

Care staff are voting with their feet. As many as one in five care staff, social services staff and others are actively seeking new jobs. No wonder two out of three social services departments are reporting recruitment difficulties. We are faced with the real prospect of importing staff from abroad, only to export elderly people to the continent to be cared for.

In the care homes sector, there is no escaping the fact that a combination of falling incomes and rising costs has resulted in a substantial loss of beds. In the last three years alone, 35,000 beds have been lost and the number of new registrations has dropped dramatically.

If the hon. Gentleman feels so strongly on this point, can he explain why, during its eight years of running East Sussex county council, his own party came consistently bottom of the national league table for the rates it paid to care home owners?

Probably for the same reason I gave to the hon. Member for Isle of Wight (Mr. Turner): the council in question was not properly funded in terms of social services. Yet again the hon. Gentleman plays into the hands of the Government by dividing councils and accusing them of failing to deliver, when in fact they have not been given the resources to do the job in the first place.

As a result, care home fees have been driven down so far that we are in a situation where it is impossible to be certain that continuity of provision can be maintained. With figures as low as £225 per week for residential care and £336 for nursing care, how are owners supposed to comply with the new standards, let alone staff their homes and care for the residents?

I have some sympathy with the points that the hon. Gentleman is making. But how does he reconcile the difficulty that he describes, of new care standards—which he criticises—and of staff whom he describes as McDonald's rejects? Surely if we want the right staff in place, we must have the standards to encourage them.

The hon. Gentleman is quite right to say that standards must be appropriate and that there is a need for extra training. But training is not cost free; it requires money. The problem is that the Government have not recognised that and they appear to be in denial when it comes to the extra costs that are a consequence of compliance with the standards. That is where the problem lies and that is why we are bringing the matter to the House tonight.

On issues of funding, we see that private payers and so-called preserved rights residents are subsidising the shortfalls in state-paid fees. In the case of preserved rights residents, this was in excess of £50 million last year alone. Charities that run care homes are using as much as £185 million of their own funds to plug the gap in state funding for care. That is 19 per cent. up on last year and it is still rising. Money given by the public for charitable purposes is used to prop up state-funded care that is inadequate because it is not properly funded.

On top of that funding shortfall and the staffing crisis in care homes, care homes are also faced with the new care standards coming in this April. Higher standards will mean fewer residents and even less income. Try selling that to a bank manager: "We want to make adaptations and changes to our care home and we need extra capital to pay for that. But we will have less income once we have made the changes". I do not see many bank managers signing up to that.

It is no wonder that, faced with mounting difficulties, care homes are often realising a better rate of return on their capital by selling the property. The victims of this are the frail and vulnerable elderly who are forced to pack their bags and move to another home. The trauma can and does kill. Despite mounting evidence of the extra costs of complying with the new standards, Ministers seem to remain in denial.

Earlier today I was briefed by Leonard Cheshire Homes, which had done some calculations on the costs of complying with the standards for young adults. It found that the weekly cost per resident in one of its homes for disabled adults will rise from £680 to £1,092, a 62 per cent. increase to comply with the training and other standards laid out by the Government. In addition it has estimated that it will need to find an extra 237 nurses to deliver the standards. Where are 237 extra nurses coming from? The NHS? I do not think so. The Government need to spell out where the extra resources are coming from.

Home care fares no better. Under the Government, there has been a 19 per cent. reduction in the number of people receiving home care—93,000 fewer people a year receiving home care in just four years. The Government amendment says that more people are living independently. Perhaps that is what it means—93,000 extra people not being supported in their own homes.

The rules have been rewritten so that only the most frail and dependent are looked after and the rest have to fend for themselves. To make money stretch a little further, care is increasingly being rationed. It is being rationed by denying help to those with moderate care needs or with a carer at home. It is being rationed for those who have high care needs by having them wait in hospital beds or, more likely, having them wait unseen in their own home. It is also being rationed by setting limits either on how much the council is prepared to pay or on the quantity or quality of care to be provided.

According to the LGA, six out of 10 councils have tightened or proposed to tighten the way in which they ration care, as a way of controlling their spending. All we are talking about tonight are things that are not luxuries—help with getting in and out of bed, getting dressed, keeping clean, eating a reasonably balanced diet, having nails cut, using the toilet, having clean laundry, living in a decent environment. We are talking about a person's basic dignity. That is why Liberal Democrats remain committed to the principle that personal care should be free, on the basis of a person's need.

Increasingly, personal care involves services that would have been seen in the past as nursing care, such as changing catheters and dressings, preventing or treating pressure sores and managing medication. That is why Liberal Democrats say that nursing care should be free on the basis of need, not according to who provides it.

The Government's answer to the crisis in the care system is to treat the symptoms and not the causes. The £200 million initiative to tackle bed blocking that was announced last year falls well short of what is needed to tackle the staff shortages, capacity constraints and rationing of the care system that are causing delayed discharges. The £200 million has to be set against a long history of underfunding.

Year by year, the gap between what councils spend and what the Government think needs to be spent on social care has widened. The gap has increased from 3 per cent. in the early 1990s to 8 per cent. in the mid-1990s; in the past three years, it has widened to a gulf of 12 per cent. More than £1 billion has to be found by local councils through council tax to meet statutory duties and respond to yet more Government initiatives and priorities. As a direct consequence, over the past two years three out of four social services departments have overspent their budgets. How much worse would the problems in the NHS be if councils spent down to the level the Government think is necessary and clamped down on overspending?

Against that backdrop, the absence of any extra cash for social care in this year's local government settlement is mind boggling. Social care has been short-changed to the tune of £113 million in the coming year—money that was pencilled in by Ministers in the spending assessment in 2000, but not actually delivered this year. As a consequence, overspending will continue to rise.

Health and social care are two sides of the same coin: underfund one and the other is undermined. It is for that reason that the Government must undertake a whole system review of funding social care. Such a review must go beyond the Government's sticking-plaster solution of cash to tackle delayed discharges. What is needed is long-term, sustained investment in social care, informed by a realistic assessment of what is needed to deliver real improvements.

Social care is stuck in crisis management mode. Those with less acute needs drop off the queue, only for the vicious circle of lack of support, leading to increased dependency and greater calls on high intensity care, to start all over again. That is a false economy that is doing great harm. The true cost of running the system in that way is measured in two ways—in ministerial failure and in human misery.

rose—

I call Mr. Hinchliffe. [Interruption.]

I apologise. I thought that the Minister was holding back.

7.33 pm

I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof:

"welcomes the Government's strategy for modernising social care services through unprecedented real terms increases in resources, which enables and promotes better joint working between the NHS, social services, and the independent care sectors, develops a national framework for standards and quality and ensures a greater emphasis on users and patients in the design and delivery of services; notes that this has led to more independence for older people, fairer funding of long term care, reduced levels of delayed discharge and greater choice for users; and condemns the Liberal Democrats for their obsession with producer interests over those of users and patients and their failure to recognise that investment must be matched by reform."

I am sorry, Madam Deputy Speaker, but the peroration of the hon. Member for Sutton and Cheam (Mr. Burstow) was so underwhelming that I had not realised that he had finished speaking.

The care system plays a vital role in ensuring that vulnerable people of all ages receive the care that they need, and I should like to start by commending the efforts of those social workers and care staff in both the public and independent sectors who, every day of the week, provide support and opportunity to people in need. Incidentally, those staff will not have been impressed by their description by the hon. Gentleman as rejects from McDonald's. That reference might have been noted outside the House.

rose—

I hope that the hon. Gentleman intends to withdraw that slur on our care staff.

It was an attributed quotation from an organisation. That is all.

The hon. Gentleman has not apologised, but he has attempted to pass the buck.

However, it is clear that we can all do more to ensure that the care system provides the right care at the right time and in the right place, that it promotes independence and choice and that it puts the user and the carer at the centre of services.

The hon. Gentleman made much of delayed discharges and we are all agreed that we need to make sure that people do not have to wait in acute hospital beds when they could be better cared for elsewhere. That is, of course, not a new problem and, in fact, the proportion of older people who have to wait while their discharge is arranged has fallen steadily over the past four years. It is true, however, that we need to consider the issue seriously.

A serious consideration of this issue must start with an honest look at the figures. Today we have heard ludicrous claims about the number of people who have their discharge delayed. This evening, the figure went up to 700,000. Throughout the day, the figure has varied by about 200,000, depending on which edition of the press release is being referred to. The hon. Gentleman's calculator may have been red-hot today, but I am afraid that taking a figure from a parliamentary answer and then multiplying it by the number he first thought of might make for good stories, but it does not get us any further in the important task of ensuring that everybody gets the care they need when they need it and where they need it.

We have all learned to disbelieve figures quoted by the Liberal Democrats, but will the Minister comment on the figures published on Friday by Eastbourne district general hospital that show that, despite the extra money that has been invested recently by the Government, the number of beds blocked has risen since June—when it stood at 46—by so much that the acting chief executive said that the hospital had 75 beds blocked and a consistent flow of patients who need them?

I do not have the figures for Eastbourne at my fingertips, but I know that like other areas it will have benefited from the extra investment and will be subject to the targets for reducing delayed discharges. Of course we need to tackle delayed transfers in order to make sure that the whole system works effectively, but I have to point out to hon. Members that, contrary to what the hon. Member for Sutton and Cheam suggested, more operations are now being done in the NHS and waiting lists are down.

We know that there is more to be done. That is why, in October, we announced an additional £300 million—not £200 million—during this year and next for councils to work with their health and independent sector partners to tackle the delays and the causes of delay.

The Minister mentioned a figure of £300 million, but the directors of social services estimate that £1 billion is required. What will fill the gap between the £300 million that the Government are providing and the £1 billion that the experts in the field say that they need?

That is not the first example, and I am sure that it will not be the last, of the Liberal Democrats calling for more money regardless of how we change the system. I will say more about the extra resources that the Government are putting in to personal social services over and above the £300 million, but the point remains that we have been willing to invest that sum in order to ensure that we can tackle delays.

Is the £300 million intended to deal only with delayed discharges from hospitals or also with delayed admissions from the community?

I thank my right hon. Friend for that intervention and I know of the good work that he has done in Birmingham on the problem of delayed discharges. As I will explain later, the investment in social services, and that £300 million in particular, has to deal with all the problems in the system, including funding projects that will ensure that people do not end up having to go into hospital, perhaps by providing better support in their homes, as well as ensuring that we have the capacity and the necessary services to get them out of hospital in a timely manner.

Everything that the Minister says shows that my hon. Friend the Member for Sutton and Cheam (Mr. Burstow) is right to say that the Government are in denial. For example, is it not the fact that in Somerset the extra money that has been provided to deal with bed blocking is almost exactly matched by reductions in grants for other parts of social services? That means that no improvement is possible.

No, it does not mean that, as I shall explain later. I monitor carefully the figures for delayed discharges and can assure hon. Members not only that the trend is down but that since last September there are fewer blocked beds and fewer people wait more than 28 days. The investment and the new services that it has brought are working, and the health service and its social care partners deserve congratulations on the progress that is being made.

The hon. Member for Sutton and Cheam made some points about care home capacity. The Government are well aware of those issues. Once again, however, the truth has been misrepresented. Figures show that the loss of beds during the past few years is nowhere near as high as the figure of 35,000 cited today, or the figure of 50,000 that has often been cited. Indeed, residential care and nursing home capacity is roughly the same today as it was four years ago.

It is nonsense to consider closures in isolation. Laing and Buisson's figures, for example, show that more than 33,500 beds were created between 1996–97 and 2000 as a result of new registrations. The net loss of care home beds during that period, according to Laing and Buisson, which has no axe to grind in the matter, was about 19,000. To claim a higher figure is both mischievous and misleading. After this debate, 1 hope that figure will not be used again.

What must we do to maintain that capacity and to ensure that standards are what we would expect for our constituents who use those services?

I am listening to the Minister's comments with interest, but let us put the dispute over the historical figures to one side for a moment. When I visit care homes in my constituency, I am told that the wholly erroneous standards specified in the Care Standards Act 2000 are forcing them to make real decisions about the future. They have to decide whether they can afford to make those so-called improvements even though their homes already function perfectly. The owners are all drawing up plans to sell their large old houses for flats. What impact will the Act have on the number of future places in homes? Has the Minister made an assessment?

I thank the hon. Lady for her intervention. We are witnessing a certain amount of confusion among Liberal Democrats this evening—certainly as regards their historical position. The hon. Lady seems to be suggesting that we should oppose the whole idea of setting up national standards, while the hon. Member for Sutton and Cheam supported it. I take the impact of standards extremely seriously, as I shall explain later.

Does my hon. Friend share my concern that the Liberal Democrats seem to be denying the need for care standards to protect elderly people who desperately need them? Is she aware that, when the Government held their widespread consultations on care standards, most care home owners in Lancashire told me that the standards were, by and large, examples of good practice. Those owners were already implementing such standards. If they had a concern, it was about building regulations. The Government responded to that concern by extending the period needed to convert the buildings to the new standards.

I thank my hon. Friend for that intervention. I know that she has a close and good relationship with the care homes in her constituency. I shall talk about care home standards in a moment.

It is also worth pointing out that the Liberal Democrats have turned their fire on domiciliary care. Those services have never been regulated. I am interested to know whether the Liberal Democrat approach is that there should be no regulation of the whole sector that deals with care services provided to people in their own homes.

rose—

Hopefully, we shall now receive clarification.

I am more than happy to make it clear, as we did throughout the passage of the care standards legislation, that we support the introduction of national minimum standards but, as we pointed out, higher quality comes at a cost. The problem is that the Government are not prepared to write the cheque.

I am glad that I gave the hon. Gentleman the chance to correct the impression that he gave in his original comments.

It is important to remember why national standards are being developed—that relates to the point made by my hon. Friend the Member for Blackpool, North and Fleetwood (Mrs. Humble). The old regulatory system for care homes is riddled with gaps and anomalies. Existing standards for care homes are set and administered in different ways by different authorities, and some homes are not regulated at all. I am sure that hon. Members will have heard—as I have—the complaints of care homes and users about the current inconsistencies.

The introduction of national minimum standards will mean that providers will be clear about the standards that they have to meet, and users and their carers will know what they can expect as a minimum. It is right to provide that protection and assurance for the vulnerable people who use our care system.

The fundamental point is that, although we welcome the introduction both of care standards and of the increase in the minimum wage, there is an increasing mismatch with the money provided to social services. The Minister knows that, next week, I shall be meeting her with a delegation of representatives from health authorities, social services and the independent sector to raise the issue of that increasing gap between the cost of meeting the welcome standards and improvements in the residential sector and the money provided for social services. That problem affects not only Cornwall but many parts of the country. The Minister must address that gap.

I thank the hon. Gentleman for making that point. I have lost count of the number of Liberal Democrat demands for extra money but I shall deal with his point.

The way that we implement the standards is crucial. In particular, the focus of the National Care Standards Commission, when it takes over regulation and inspection in April, will be to work with providers to help them to meet national minimum standards. In practice, that means that if standards were not being met in a few respects the commission would note that in its inspection report and would write to the home owner giving reasonable time in which to make the changes.

Of course, the point of national standards is to ensure consistent high standards throughout the country, not to close good homes. That is why, when we heard the results of the consultation, we made changes to the standards, putting off the environmental space standards until 2007 and ensuring that space could be used flexibly. However, I am determined that the standards will be introduced in a way that will safeguard users and maintain good homes. I will be discussing with industry representatives and with the National Care Standards Commission the details of the environmental standards, and how we can ensure that they are introduced in a way that promotes higher standards for users but does not drive high-quality care homes out of business.

Local authorities are rightly responsible for decisions about the fee levels that they pay. It was interesting to hear Liberal Democrat Members speak about the failure of some Liberal Democrat councils to live up to the enthusiasm of their Members of Parliament. However, fee levels should reflect the quality of care that we expect from care homes for our older people. That is why I welcome the fact that local authorities are using funding from the £300 million building capacity grant to buy additional places in care homes.

A number of councils have drawn up new agreements—which include increased funding—with the independent sector, to stabilise the sector and ensure that standards of care are maintained. That will help to ensure that capacity is maintained locally, so that the right range of care services can continue to be provided to older people in the future.

The debate about care goes wider than care homes alone. The Government have also introduced a range of reforms to the long-term care system. Free nursing care in nursing homes was introduced on 1 October, as we had promised. The benefit is felt by more than 42,000 people, who could save as much as £6,000 per year. Councils have had extra money to introduce deferred payments, so that people do not have to sell their homes to go into residential care. Since last March, the value of a property has been disregarded for 12 weeks in the residential care means test, and capital limits have been increased.

It is important to maintain capacity and make the system fairer, but more of the same just will not do if we want to provide real choices and independence for our older people. I am encouraged by the figures that show that 5 per cent. more households were receiving intensive home care packages in 2000 than in 1999. About 1.5 million people now receive care packages of all types in their own homes.

In addition, the national service framework for older people, published in March last year, focuses on raising standards and promoting independence in services for older people.

Is not the Minister concerned that the 5 per cent. more people receiving intensive care packages at home might have come at the expense of the 93,000 fewer people who receive all types of care packages at home? Stealing from one group of vulnerable people to provide for another such group is a cynical tactic, not something of which she should be proud.

I am sure that Liberal Democrat councils around the country will be interested to hear that Liberal Democrat MPs think that they are stealing when they make local decisions about resources. The important point is that local authorities and their health partners are using the extra resources that have been made available to find new and different ways to support old people's independence. That is to be welcomed.

Central to raising standards in the national service framework is the increased development of intermediate care services to provide rehabilitation, to support independence, to prevent people from going into hospital into the first place, and to help them back into their own homes after a spell in hospital. The extra investment in these services has already led to more beds, more places and more people receiving these services.

A new advice and information line, Care Direct, went live in the south-west from 1 October, providing advice and information on health, housing, social care and social security issues. These types of services—new services that promote information and independence for older people—will be developed across the country. These and other initiatives already being delivered, totalling £1.4 billion from 2001 to 2004, will support older people more effectively and independently.

The Minister is generous in giving way again. She is good at blaming Liberal Democrat councils for what they do or do not do, as if we controlled the world. No party is in overall control of Devon county council, but the leaders of all the four political groups in that county—Liberal Democrat, Conservative, independent and Labour—came to lobby Devon MPs last week. They had but one message: that funding for Devon is inadequate, and that there is insufficient money for the SSA for services for the elderly or for children. Devon's problem is that it cannot deliver enough money to the independent care homes. It recognises that, as do the independent care homes. How can the council improve the care standards—

Order. An intervention is meant to be brief.

I had started to speak about the extra resources going into local authorities. Some of those extra resources are, rightly, finding their way into new services and into increases in fees.

The hon. Member for Sutton and Cheam called the Government's policies quick fixes, or words to that effect.

Sticking plasters.

The hon. Gentleman called the policies sticking plasters, but not one of them is a quick fix. The accusation is ironic, coming as it does from Liberal Democrat Members, who think that the only fix is more money, more quickly.

Of course we need to reform the system further: we need new services, new choices and new ways for health, social care and their independent partners to work together. That is why my predecessor established a high-level strategic commissioning group to give greater direction to the commissioning of care services for adults.

The agreement published by the group, which brings together representatives from a variety of organisations, sets out responsibilities and expectations for central Government, local government, the NHS and independent providers. It stresses the need for councils and the independent sector to enter into long-term agreements on placing people into care homes or giving them other forms of support. It will lead to improvements in the commissioning of services and therefore more choice and security for older people.

The Government have broken down the legislative barriers that prevented health and social services from working together, so that services are now beginning to be designed around what older people actually need and want rather than what fits administrative boundaries. We need to see even more of that type of working. Of course, that needs more investment and resources and, yes, social services have been underfunded. That is why the Government have increased social services funding by more than 20 per cent. in real terms since 1996–97—an average annual real terms increase of 3.2 per cent.

Incidentally, before we hear from the Conservative Opposition spokesman, I should say that that increase stands in contrast to an average annual real-terms increase of 0.1 per cent. in the last five years of the previous Government and no promise to match our social services spending at the last election.

Perhaps we can have a quick reality check. Will the Minister confirm that the gap between what the Government say social services need to spend and what they actually spend amounts to £1 billion—a 12 per cent. difference? That is the reality, is it not?

We are working with the Local Government Association to ensure that, as I have said, we continue to put extra resources into social services. In fact, the gap has narrowed in the past year. We are working to attract more staff through a recruitment campaign that we launched last year, and it has already attracted at least 14,000 responses. We are investing in training support to ensure that our care workers have the skills that they need.

Today, Liberal Democrat Members have been big on calls for more money and short on vision or ideas for reform. The Tories will be big on complaint and low on investment. What people will get from a Labour Government is more investment, higher standards, more services, more choice, more independence and more hope for the most vulnerable people in our society. I commend the amendment to the House.

7.57 pm

I certainly welcome this debate, but I must say that listening to the increasingly bitter exchanges between the Minister and the hon. Member for Sutton and Cheam (Mr. Burstow), I began to feel that I was intruding on private grief—it seems that the love affair between the Labour party and the Liberal Democrats is well and truly over if the early stages of the debate are anything to go by. It is amazing to think, Madam Deputy Speaker—and even you can think about it—that there was a great cosy love affair only 18 months ago. Lord Ashdown, the right hon. Member for Berwick-upon-Tweed (Mr. Beith) and the right hon. and learned Member for North-East Fife (Mr. Campbell) were all involved in a Cabinet Sub-Committee—the first time that that has happened since the time of Lloyd George. Tonight, we can well and truly see that that love affair is over. The bitterness of both sides is more than apparent, given the way they were at each other's throat.

Just yesterday, it was widely reported that the elderly in Britain are being penalised by the NHS because of widespread health care bias and discrimination. Although that is deeply alarming, such discrimination is not a wholly new revelation. Indeed, such prejudice towards the elderly has increasingly manifested itself in another aspect of Government policy since 1997—long-term care for the elderly. Between 1998 and 2001, the number of general nursing homes in England fell by 13 per cent. During that relatively short period, nearly 22,000 nursing homes beds were lost and about the same number of hospital patients had their discharges delayed because there were no places available to look after them properly in the community.

Less than one year ago, there were 525,900 places in residential settings for long-stay care for elderly and physically disabled people across all sectors.

I am a little concerned by the fact that the debate seems to be concentrating on beds when community care should be about preventing people needing beds. How do countries such as Denmark, with a similar proportion of elderly and very elderly people, manage without any care homes whatever?

The hon. Gentleman raises an important issue concerning domiciliary care, and I will refer to it in my speech. The simple answer to his question is that the debate has revolved around beds because it is about the crisis in care. Unfortunately, the Government's record on what has happened to the number of beds over the past few years has helped to contribute significantly to the crisis. That is why the issue will be an integral part of the debate. I know that the Government do not like to hear bad news or, in many cases, the truth when it is unpalatable, but they will have to listen to it this evening without the fantasy, the spin or the denial of Ministers.

rose—

I will give way when I have made some progress.

As I was saying, less than one year ago there were 525,900 places in residential settings for long-term care for the elderly and for physically disabled people across all sectors. That is a drop in capacity of almost 50,000 places since 1996–97. Indeed, 760 care homes were closed in 1999 alone, resulting in the loss of more than 15,000 beds. In anyone's mind—except that of the Minister, who does not seem to think that it is happening—that is an extremely alarming situation.

I do not know about the Minister's constituency, but in mine two care homes have closed in the past 12 months. I suspect that most hon. Members—certainly those on the Opposition Benches—will probably have experienced the same tragic situation. For some reason, it is not obvious to Ministers, who want to perpetuate the myth that everything is fine and that any fact or statistic that suggests otherwise is not true.

I remind the hon. Gentleman that his Government introduced the National Health Service and Community Care Act 1990. When the then Secretary of State for Health announced its introduction, he agreed with Sir Roy Griffiths who had been commissioned by the then Government to produce a report and who said that 25 per cent. of care home beds would be lost as a result of that legislation because it was deliberately designed to move people out of residential care and into a home care setting.

The hon. Lady must understand that one of the fundamental principles of community care was to examine where it was possible to allow people to remain in the familiarity and security of their own homes with domiciliary care packages. If there were a static population, that would lead to the loss of some beds because they would not be needed. The hon. Lady is talking about what happened 10 or 11 years ago and the elderly population has increased significantly since then. For a variety of clinical and funding reasons, many people have not been to able to remain in their homes. In recent years, care homes have closed and beds have been lost not because there is no demand for them, but because it is not viable for a variety of reasons—some financial and some bureaucratic and administrative—for them to be retained.

The other problem is that the closure of homes is not taking place where there is spare capacity. More often that not, it is happening in the south-east, the south-west and the eastern region, where there is the greatest demand, and that creates a greater problem. The situation is critical. A survey in May 2001 showed that more than 70,000 pensioners were forced to sell their homes in 1999 to pay for the cost of residential nursing care. That represented a near doubling of the 40,000 pensioners in the same circumstances when a similar survey was carried out in 1995.

Even more worrying is the survey of 104 councils which showed that

"potentially more than a quarter of a million"

pensioners have been forced to sell their homes to pay for care costs since Labour came to power. Is that what Labour meant when it claimed that things can only get better? That is not how most elderly people who have gone through that tragic process or who are fearful that it might happen to them would define getting better.

Will the hon. Gentleman give way?

I want to make some progress first.

The Government have failed to address the problem for far too long. The average age of this country's population is increasing. Some demographic projections indicate that the provision of nursing home beds needs to expand by around 65 per cent. by 2031 if the population is to be adequately cared for. Yet with the number of beds falling, an even greater expansion—possibly as much as 100 per cent. over the next 30 years—will be needed to meet the target.

Will the hon. Gentleman give way?

No, I am going to make progress.

The Government can continue to spin the situation, to fiddle the figures and to call it what they like, but the stark fact is that there is a crisis in long-term care. They may refuse to recognise that, but Opposition Members are not the only people who live in the real world and understand what is going on. Frank Ursell, the chief executive of the Registered Nursing Home Association, has commented:

"The Government can rightly be accused of fiddling while a vitally important part of the health care sector declines before its very eyes. Inaction by the Government, coupled with chronic underfunding of services for older people, could mean that there will be insufficient long-term beds available in the years ahead."

The National Assistance Act 1948 is long out of date. Fortunately, the provision and the policy of caring for old people has moved on from the undignified and sole-destroying placement of the elderly in long-stay hospitals, where they had little comfort and little self-respect or dignity. That has gone, and I suspect that no one would object to that.

We have to ensure that community care is developed—I strongly support this policy—so that it provides the back-up and the freedom from fear that the elderly deserve in the 21st century. I am afraid that despite some welcome strides forward, such as the raising of standards, more has to be done to address the problem. The knock-on effect of the loss of nursing homes and beds is causing a critical problem with delayed discharge, or bed blocking. A vicious circle is emerging. The increasing number of residential home closures has led to further delays in discharging older people from acute hospital wards. Not only does that prevent them from leaving hospital, but it lengthens the waiting times for patients who want hospital treatment.

The situation is ridiculous. On 9 October last year, the Government claimed that approximately 6,000 beds were blocked by patients who were well enough to be discharged. On 15 October, the Daily Mail revealed that the real number of delayed discharges was 100 times higher. [Interruption.] The Minister says, "It's wrong." It is not. I am worried that a Minister can sit there and, almost ostrich-like, blind herself to the reality of what is going on in the real world.

Although the Minister says that the article was wrong, after the Daily Mail had pointed out that the Government's figures were wrong, the Government admitted that they were wrong: they had referred only to those beds blocked in NHS hospitals on any one day, leaving out the other 364 days in the year. There is no point in the Minister repeating like a parrot, "It's wrong." It is not wrong. The Daily Mail also revealed that Department of Health statistics showed that over the course of the year, there were more than 680,000 elderly bed blockers. The Government insult the country by systematically refusing to accept what is happening. How are we to believe Ministers if whenever they are given information they do not like, they say it is not true?

Last year in inner London, 11 per cent. of acute beds were blocked. In December, in response to a written question tabled by my hon. Friend the Member for Woodspring (Dr. Fox), the Minister acknowledged that 36 per cent. of patients subject to delayed discharge were delayed in hospital for more than 28 days. That equates to almost 245,000 patients. How many patients could have received acute treatment had those beds been available and not blocked by people who had nothing wrong with them but had nowhere else to go?

The Government's policy and the knock-on effect of delayed discharge is having a profound effect throughout health care provision. Insufficient care facilities in the community mean that elderly people are being kept inappropriately in hospital, which in turn prevents those who need hospital treatment getting a bed.

We recognise that hospital is not always the most appropriate environment in which to care for elderly people. Wards tend to be noisy and overcrowded, with individuals afforded little privacy. The Government have failed to meet their deadline for ending the use of mixed-sex wards. Even more disturbing is the high risk of elderly people in hospital acquiring infections: almost one in 10 of all hospital patients contract an infection during their stay.

Although I welcome last October's announcement by the Government that they would release £300 million over two years to tackle delayed discharge, I agree with Sheila Scott of the National Care Homes Association, who described the sum as a "sticking plaster". With 680,000 bed blockers last year, 1,000 extra beds will do little to alleviate the problem that the money is intended to tackle. The vicious circle will continue to revolve until the problem of bed blocking and delayed discharge is brought under control. In the meantime, all care suffers. Under new Labour, we have been put in the ridiculous position whereby one is put on a waiting list both to get into hospital and to get out of hospital.

The Government have failed on another key aspect of health care: free nursing care. Before the last general election—under new Labour, these things always happen just before a general election—the Prime Minister and the Secretary of State promised that there would be free nursing care in England as soon as its introduction was viable. Since then, the implementation of the policy from 1 October has not lived up to the expectations raised by that promise.

Many people feel betrayed because they took the Government's words at face value and believed that everyone would receive free nursing care. They failed to realise that it was the Government who would define nursing care and personal care. Now, a significant number of people who thought they would be entitled to receive free nursing care have been told that they will not get it, because the care they need has been categorised as personal care. Some sufferers from Alzheimer's disease or dementia, for example, may not receive nursing care because it is judged that their care is personal care, and under the new policy personal care is not paid for by the system.

I seek clarification. Is the hon. Gentleman advancing the view that personal care, like nursing care, should be free? Can he explain why his Front-Bench team, who in opposition took that measure through in the last Parliament, did not pick it up and did not deal with the complications of the Government's free nursing care scheme?

We fully support the provision of free nursing care, as we did before the last general election.

Not personal care?

No, free nursing care. Like the Government, we also said at the last general election that we would not give a commitment to free personal care. We fought the last election on that policy, and so did the Government. I know the Liberal Democrats had a different view, but I am stating the policy on which we fought the last general election.

Far too many people feel that they have been let down over the free nursing care promise, which has not lived up to expectations. The Government wring their hands and will not accept evidence that any constituency MP is more than familiar with, especially if they live in the south-west, the south-east or the eastern region. They see homes closing down and being sold off for other endeavours. Homes are under tremendous financial, bureaucratic and administrative pressures. They are desperately trying to provide the highest standards of care for their residents.

We all support the idea of more provision of domiciliary care for people for whom it is a viable and rational option, so that they can remain in the security and familiarity of their own homes. However, there is a crisis, as the title of the debate on the Order Paper shows. It would be far better for the elderly of this country if the Government recognised the arguments and did more to help alleviate the problem, rather than pretend that it does not exist or that it will merely fade away.

8.17 pm

I welcome the debate. I shall probably break the consensus that has existed so far. I do not subscribe to the view that the success of community care policies can be evaluated on the basis of the number of beds in private care homes. I worked in the care sector for many years, including in care homes. My mother ended up in a care home, and that was the worst experience of my life. I do not want to end up in a care home. I think that we can do a damn sight better for our elderly people than sticking them in institutional care. As the Minister implied, it is about time that we showed vision and courage by moving in a more radical direction.

I felt depressed when I listened to the criticisms of the Government, which were almost wholly based on the decline in the number of care beds. If community care is working, of course there will be a decline in the number of care beds. Reference has been made to people such as Sheila Scott, the chairman of the National Care Homes Association, and others whom I have known for a long time. I probably know more private care home owners than most hon. Members, and I have never known any who have been poor. Someone somewhere is making money out of the sector. I have not seen them walking away from the private care sector.

I want to explore key areas that have not been touched on so far. I was surprised that the hon. Member for Sutton and Cheam (Mr. Burstow) did not mention the structural problems that have occurred as a result of the split between health and social care since the 1940s, which is a major area. I understood that Liberal Democrat policy was to do something radical about that, but perhaps they have moved away from that position.

Somebody mentioned the National Assistance Act 1948, which set out local government services that were to be means-tested. There was also the National Health Service Act 1946, under which care was to be free. Since then, we have had difficulties in matching up the two parallel systems. In 1974, the Conservative Government moved more elements of local government health care into the health service, complicating matters even further. I worked in social services at that time, so I am aware of the difficulties involved in getting the two elements of the care system to work closely together.

We have talked about the royal commission on long-term care, which was proposed by the Labour party when I was a Front-Bench spokesman on community care policy. I claim no credit for the proposal, because it was the idea of my right hon. Friend the present Home Secretary, who is a good friend. It was right to try to develop a consensus on the direction that the long-term care of the elderly should take. Personally, I believe that the conclusion in the majority report was correct. The split between nursing and social care is unsustainable, and nobody has managed to define the two types of care. At the moment, the definition of nursing care is anything that a nurse does. What absolute nonsense. I think that the definition will be challenged in law; it is impractical and it will not last very long.

My Government have made tremendous progress on community care, and I concur with much of what the Minister has said. I fully and actively support many of the Government's reforms, but I do not believe that we yet have the right policy to tackle the divide between personal and nursing care. We will have to revisit that matter. I would go further and tackle the separate structures for health care and for social care. I do not want to rehearse arguments that I have been making for many years about having a common system delivering health and social care, but until we get that we will have problems.

The hon. Gentleman and I have worked together over the years and I know of and share his concern. However, I must enter a caveat. In Northern Ireland, health and social services work together, but we still have the same problems with the availability of beds. We must deal with the financial structures so that one section is not holding back from another.

I have the greatest respect for the hon. Gentleman, whom I have known a long time. He has had a passionate concern about health and social issues for all the years I have known him. Obviously, he knows the Northern Ireland system far better than I do, but I understand that the problems there arise from the fact that although there is one common organisation, there are still separate budgets.

That brings me to my next point, which relates to the figures on delayed discharges which were given to the Health Committee. In October, we were told that 6,000 beds are blocked on any one day. That was the Government's figure. I do not know whether it is correct, but I have not seen a revised figure. We were also told that the cost of an acute bed averaged out at £120,000 a year, so a quick calculation tells us that blocked beds cost £720 million a year.

I would bet my bottom dollar that for a small proportion of that sum, we could have got those people out into the community and cared for them more cheaply, more effectively and, from their point of view, more happily and in a more settled environment if we had a coherent organisation running the whole show. I make a plea for a common health and personal care organisation—a plea that I have been making in the House for the past 15 years. I hope that by the time my career in this place ends, I will have got somewhere on this issue. I look forward to the Minister tackling that point in her winding-up speech; my hon. Friend is really suffering this week.

I turn now to a point that was not dealt with in great detail by the Liberal Democrats. The difference between the marked and welcome increases in NHS funding under this Government and the less positive developments in personal and social services funding is having a serious effect on our ability to unblock beds and tackle difficulties in the community. The Government told the Health Committee that the total gross expenditure on the NHS had increased by 8 per cent. in the last financial year. That is an impressive increase, and I welcome it. The budgeted personal social services expenditure for the same year went up by only 1.4 per cent. That is a big difference, and I am sure that the Minister understands the consequences.

I was reminded of the consequences at my surgery only last Friday night, when a lady came to see me about her mother, an elderly lady who had been in hospital for a hip operation. She was on an orthopaedic ward and was told, to the surprise of her daughter, that she was fit to be discharged into a private care home. The daughter was told that she had to get on with getting her mother out because she was blocking a bed. The daughter felt that her mother ought to be transferred to a geriatric ward or into intermediate care, but she was told that her mother had to go into a private care home.

The daughter obtained a private care home place for her mother. Interestingly, she was told by the ward sister that because her mother had private resources she could fund her care and there was more pressure on her to leave than there would be on someone who would be funded in that care home by the local authority. I do not know whether that is true or not. If after making local investigations I find that that is happening, I may well draw it to the Minister's attention because I will be concerned; I am certain that she will share my concern.

I differ from Conservative and Liberal Democrat Members on the use of the private market. In a week in which the Government have talked about making more use of the private market, it is important to look at the implications of relying on the private market in care provision. The hon. Member for West Chelmsford (Mr. Burns) appeared to accept no responsibility for the current situation in the care home sector. However, he knows full well that his Government decided in 1981 to allow supplementary benefit payments to top up private care home fees. That unpublicised decision led directly to a massive explosion in private institutional care. As a result, huge numbers of nursing homes and care homes sprung up across the country. Mrs. Thatcher believed in stimulating the market; consequently, we are bogged down in the community care system and locked into the kind of debate that we are having tonight in which we worry about the number of beds that we have.

The huge explosion in private institutional care arises directly from the market's involvement. Figures that I obtained from the Library show that, between 1981 when that decision was taken and 1993 when community care changes were introduced, the Conservative Government spent £10 billion subsidising private care homes. How much could a proportion of that money have done to keep people in their own homes? There was money to put people in institutional care, but not to keep them out.

Will the hon. Gentleman help me? Is it not the policy of his Government and the Secretary State to use the private sector in the provision of acute health care as well?

I am still trying to explore what has happened this week; it has been an interesting experience for one or two of us. I referred to the use of the private sector in care because I fear the consequences of its use in the NHS, as the hon. Gentleman knows full well; he knows my feelings in great detail.

Following that point, does my hon. Friend agree that as a result of the Griffiths report the previous Government wrongly decided to demand that 85 per cent. of all moneys be spent in the so-called independent sector? They spoke about a mixed economy of health and social care provision, but it was nothing of the sort.

My hon. Friend is right; that decision pushed people into permanent, expensive institutional care when in many instances they did not need it.

I have not lost the thread of the hon. Gentleman's fascinating argument, which is being followed closely by his own Whips. Will he comment on places such as East Sussex, where well over 90 per cent. of care home beds are provided by the private sector?

I did quite a bit of research while advising the Labour Front-Bench spokesmen on community care for a number of years. In a sense, the problem in East Sussex arises from the use of the market. We found from my research that the market had gone for areas where there were large houses and where, in some but not all cases, there were larger elderly populations. We found that people were being moved out of inner London to places such as Sussex and Surrey, where there were more private care homes. The investment was not in the areas where they were living.

My concern is that the Conservative Government allowed the market to provide what was in the interests of the care home owners, not what was in the interests of the people who ended up having to occupy those homes. The solutions that those people got were not what they wanted. They wanted care in their own homes, or at least near to where they lived. Precisely the opposite happened.

My main concern about the use of the private sector is the way in which it invested in wholly outdated models of institutional care. There was no recognition that most old people do not want to go into a care home. Our country is unique in our reliance on institutional care. In Denmark, which is the obvious example, care homes were made illegal in 1988. Other models of care exist there, because care homes are deemed to be a humiliating form of care.

The models developed by the private sector in this country until recently were based on our old workhouse institution. Some of the care homes are not much better than some of the workhouse institutions of many years ago. I am sad to say that, and I am sorry that there have been attacks on the care standards legislation from the Liberal Democrats. [Interruption.] There certainly seemed to be attacks. I shall check the record. I was actively involved in exposing standards in the private care sector, where people were genuinely suffering.

When he checks the record, the hon. Gentleman will see that our concerns have been about care standards that have not been funded and are therefore threatened. When he criticises care homes that are doing their best with the resources and staff that they have, he should reflect on the implications for the care home staff. Are they workhouse staff?

Of course not. I am speaking of the model of institutional care, which is a direct consequence of the workhouse system. It is its historical successor, whether the hon. Gentleman likes it or not. In 2002, it is about time that we moved away from a system set up in the 1600s. None of us here wants to end up in an institutional setting, but the debate assumes that we all want to end up there and that we all want to see more care home beds. I, for one, do not. I should like to see a gradual reduction in institutional models and a move towards the models that exist in other countries—

Will the hon. Gentleman give way?

No. I have given way enough.

I should like to see a move towards models such as care link schemes and housing with care schemes. There are many in the private sector, as well as in the public and voluntary sectors, where intensive care packages are available so that people are not permanently institutionalised in their old age. The key challenge is to move away from costly, outdated institutional care and to develop alternative models of care within the community. That is what people want and it is about time we delivered it.

I have studied the Liberal Democrat motion. As the Government amendment states, it relates more to the producer interest than to the consumer. The motion refers to the

"loss of homes and beds"

and is rooted in grossly outdated thinking. The Government amendment more accurately reflects my personal concerns and contains some vision of future developments. I am happy to support the Government this evening.

8.33 pm

I am delighted to have the opportunity of taking part in the debate, and I am particularly pleased to follow the hon. Member for Wakefield (Mr. Hinchliffe). We all feel for him in his personal voyage of discovery, as he finds out what modern Labour party policy is towards our health care system.

It is breathtaking to witness the sheer opportunism and cynicism of our Liberal Democrat friends in some of the matters that they choose to bring before the House, especially in view of the experience of some of us in East Sussex. For eight long, painful years the Liberal Democrats ran East Sussex county council. As I mentioned in an intervention, in every year they succeeded in hitting the bottom of the national league table as the lowest payers to the private sector of any council in the entire country. Interestingly, Sedgefield council was at the top of the table, but that is another matter. There was a combination of incompetence and political dogma. The Liberal Democrats were getting a bit excited about the remarks of the hon. Member for Wakefield, who speaks with great authority and knowledge on these matters. I do not want to upset him, but I must say that they are philosophically very close on these issues. I am convinced that the attitude of the Liberal Democrats in East Sussex during the eight years to which I have referred was based on dogma and the notion that people should not be able to make a profit out of running private care homes. I am sure that that is what drove their attitude to private care homes in my county. Other people's experiences may differ and I am sure that we will hear more about that.

Value for money.

I hope that the hon. Gentleman will say that to the people running private care homes in East Sussex—especially those that have gone out of business in recent years.

As I said, several different pressures were faced. First, the area was the worst paid of any in the country. Secondly, there was the dogmatic insistence of the Liberal Democrat-controlled county council on keeping open its county council-operated homes. My hon. Friend the Member for West Chelmsford (Mr. Burns), who is gracing the Front Bench, may not remember an Adjournment debate on 19 February 1997 on social services in East Sussex, which I initiated. He was the Minister who responded to the debate, in which I pointed out the disparity between what East Sussex county council was paying the private sector and what it was paying per bed per week for its own homes. At that time, the gap was a staggering £150 a bed a week. He said:

"When a local authority is complaining that it does not have enough money, I cannot understand how it can justify spending about £152 a person a week extra just by placing them in its own homes."—[Official Report, 19 February 1997; Vol. 290, c. 898.]

He calculated that the total amount that was being wasted from the social services budget in that way was £5 million.

More recently, in July 1999, I secured a debate on a similar subject. By that time, East Sussex was paying the private sector £209 a week, but it was paying for its own homes the equivalent of £401 a week. That is a difference of almost £200 for every single person in its homes. I am sure that that figure is now even bigger. In those days, it was difficult as a local Member of Parliament—I anticipate the points that the Liberal Democrats might make—to lobby the Government, whether Conservative or Labour, for more resources when the existing ones were being squandered by the county council.

The third factor that has been hitting care homes in my area very hard is the new standards that will be introduced in April this year. In principle, we are all in favour of better standards. It is right that there should be constant pressure to improve standards and make life better for people in care homes throughout the country. We have no problem with that, but the reality on the ground is that many homes have rooms that are the wrong size and do not have the facilities or the area of land that is necessary to expand their resources in the way the rules demand.

The details of the regulations were made available extremely late in the day. We should bear in mind the fact that this is a question not only of care home owners and operators, but of their bankers. For some time, banks that have previously been heavily committed in the care homes sector have stepped back and decided to wait and see how the new regulations impact on their existing and potential customers. That, too, has had a major impact on care homes in my constituency,

It is worth considering the figures that were provided in answer to a parliamentary question that my hon. Friend the Member for Wealden (Mr. Hendry) tabled on 9 January 2002. The reply stated that in 1999, 48 residential care homes closed in East Sussex alone, and that in 2000 the figure had increased to 69. Five nursing homes closed in 1999 and 10 closed in 2000. Those figures are worrying. A rapidly escalating number of private homes are being forced to close through a combination of the factors that I have outlined.

We could face circumstances similar to those in Australia, where Government neglect over many years meant that the private care sector died, went out of business and had to be reinvented by the Government at vast expense—many billions of dollars—because there was clearly a need for it. East Sussex is not unusual in having such a high proportion—more than 90 per cent.—of care beds provided by the private sector.

More and more of our older people will need such facilities and they will have to rely increasingly on the private sector. As I said, East Sussex county council kept its homes open for several years. Some of them are simply not up to the task in the 21st century. Recently, I revisited such a home, Parker house, in my constituency. It was built in the early to mid-1960s, and its fabric is crumbling. The facilities do not fulfil existing requirements, and will certainly not fulfil the new requirements that come into force in April.

The now Conservative-controlled county council has consulted on whether Parker house should be closed. I do not want to pre-empt the process or suggest that I have any inside knowledge. However, I should be surprised if the consultation did not conclude that the home should be closed. However, in the run-up to the local elections in May, some prominent local Liberal Democrats will be beating their breasts and claiming that closing the home would be outrageous, and that old people would be thrown on the streets. We should tackle such cynicism head on, and I intend to do that. Liberal Democrats would be saying, in effect, that some of our older people should be consigned to third-rate facilities and care. That is a reflection not on the dedicated and caring staff but on facilities that do not meet existing standards, let alone new ones.

Does the hon. Gentleman believe that the home should close or remain open and be refurbished? Does he have a view?

I thought that I had expressed my view, but I repeat that I suspect that a decision to close the home will have to be made. I surmise that it could be refurbished, but at inordinate expense. If I had a magic wand, I would start again on the site and build something more modern and in tune with the needs of local older people, such as a resource centre that would meet many needs that are currently not satisfied. Again, that is not to due to the staff. I shall be interested to read "Focus" on the issue. I hope that Liberal Democrats are forewarned that their actions will be met with the force of the argument that I have just presented. I am sure that there are similar facilities around the country in which similar arguments apply.

I want briefly to move on to the question of bed blocking, or delayed discharge, as I think it is more fashionable to call it nowadays. I have laid as much blame as I think appropriate at the door of the Liberal Democrats for the chaos in which they left the social services budget, and for their dogma over paying for the private care homes sector. However, the Government cannot escape blame, for two reasons. First, immediately on taking office, they changed the calculation formula for standard spending assessments so that the number of old people resident in East Sussex is no longer properly and fully taken into account by the formula.

Secondly, we have this issue of bed blocking. We keep being told that it is being solved by extra inputs of cash from the Government. At one time, bed blocking seemed to be a phenomenon that occurred in the winter months. Nowadays—at least if Eastbourne district general hospital is anything to go by—it is a phenomenon that starts in the summer and gets worse in the winter. Indeed, it is an all-year-round phenomenon.

The hospital had a major problem with bed blocking before the last election, and—lo and behold—under pressure from myself and others, the Government put in extra cash to tide it over during the election period. Last summer, there was also a major problem. Speaking from memory, I think that 45 beds were blocked in June. That is the equivalent of a couple of wards, if we want to look at it in that way. More recently, the Government have put in some extra funding. But last Friday, the district general hospital commented that the number of blocked beds not only matched but was now rising above the figure for last June, despite the extra funding. The acting chief executive, Glen Douglas, said:

"Bed blocking is causing a considerable problem at the DGH. We currently have 75 beds blocked and a consistent flow of patients who need them."

I have to tell the Minister that, whatever extra funds the Government have put into this problem, it simply is not working. We still have a major bed blocking problem.

I am grateful to the hon. Gentleman for giving way, especially as I missed the first few minutes of his speech. I share his concern about bed blocking, which affects my constituency too. Is he aware that the money provided by the Government has been allocated first and foremost to Hastings, despite promises by the county council? One of the reasons the problem of bed blocking in Eastbourne district general hospital has not been solved is that allocation by the county council.

It would have been helpful if the hon. Gentleman had been here for the first hour and 45 minutes of this debate, but it is nice to have his company none the less. I am not in the business of making knockabout party political points, and I would have hoped that he would agree with me that the extra funds that the Government have produced are not doing the job. Whether the money is allocated to Hastings or Eastbourne is neither here nor there, particularly as a merger of the two hospitals is on the cards in any event.

Will the Minister please promise to look again at the situation in Eastbourne? I appreciate that there are hospitals up and down the country that always have a story to tell about a lack of resources, but here we seem to have a genuine problem. I do not know whether the problem is administrative or endemic, or whether the money is not being disbursed properly, as the hon. Member for Lewes (Norman Baker) might have been suggesting. Whatever the practical reason for the problem, this extra money is not doing the trick. Far from bringing the figures down, we are heading towards them being twice the level they were at last summer, when they were already severe grounds for concern.

To echo my hon. Friend the Member for West Chelmsford (Mr. Burns), the Government have created a situation in which we still have significant waiting lists not only to get into hospital, but to get out.

8.49 pm

The state system for providing medical or social care is crucial and I welcome the Liberal Democrats' choice of topic for this Opposition day debate. However, I was taken aback by the language used by the hon. Member for Sutton and Cheam (Mr. Burstow). I neither recognise the situation that he described nor believe that the elderly or the great majority of my constituents in Stockton would describe the care that they receive in similar terms. They most certainly do not see social services as Cinderella services. They see them as historically underfunded, but they also recognise the professionalism of the staff who run them, so they would object most strongly to the use of such language and the notion that they must wait for someone to die before they get a place.

Let me explain to the Liberal Democrats. We have too many places and too many homes, not insufficient capacity. There is over-provision, so my constituents would find your argument untypical of the situation that they face. It has been said that district nurses are getting older. We have young district nurses. Many are being trained and many are impacting on the community that I represent. Your use of language suggests to me that you are seeking press coverage.

Order. The hon. Lady must use the correct parliamentary language.

I am appropriately corrected. The language used by the Opposition seems to court press coverage, but it does not reflect reality.

I shall not pepper my speech with statistics—an awful lot of those have been bandied around—because I want to talk about the reality that my constituency faces. Our health and social provision has developed into a health and social services partnership that has been awarded beacon status. It is innovative and it has high standards. There is a clear, professional and qualitative relationship between health and social security professionals. I hope that the Minister has time to acknowledge the value of the partnership's innovative capability. It is one of only five such partnerships to achieve beacon status and I say to Stockton, "Well done." However, I would not say that everything is fine.

The partnership's policies are often innovative and they challenge a culture in which elderly and old people's residences are seen as coincidental. We do not see things that way and it is clear that my authority does not see things that way. I do not suggest to the House that the partnership is working to maximum effect. I am very realistic. I know that it needs time and that more, serious money is required. It needs space to accommodate individual needs, but my realism is appropriate. A dose of realism would stand Opposition Members in good stead.

Inevitably there are problems and some are historical. We do not need to be told what the Conservative Government did for 18 years. We all know what they did. We know that there are demographic problems and that there is an ageing population to accommodate. There are undoubted problems because we are challenging a culture. The remark of my hon. Friend the Member for Wakefield (Mr. Hinchliffe) was so appropriate—the elderly do not always want to go into homes and residences. I talked to elderly people when I worked in Sunderland and I talk to them in Stockton. Often they would choose to stay at home.

I am not saying that there are no problems, because problems are inevitable when we propose change. I am especially conscious of the fact that stand-offs always arise when we change a policy relating to vulnerable people. People say, "We would rather things stay as they are because we are not too sure of the quality that you will provide." We understand that and I am not saying that the partnership in Stockton is achieving all. I simply say that it is innovative, achieving change, responding to higher expectations and delivering better services. It is responding in such a way that individuals feel that they are prized in the community.

A lot more has to be done, but a lot is being done. By speaking about my local authority and its relationship with the Government, I am speaking the truth. I am neither exaggerating nor underestimating the problems and opportunities.

It is difficult to see new policies delivering appropriate services, so it is valuable for all of us to hear the language used by professionals in my constituency on the Government's approach. The language of local policy-makers is invariably positive. Members might say that I would not quote them were it not. They would be wrong. It may be difficult but, as a policy-making Government, we have to face up to the problems as well as the opportunities.

The language used shows that partnership is valuable, as is supporting a fundamental change in culture. Establishing relationships between different professionals that are based on co-operation and support is valuable. Many of us in the House have professional backgrounds, and we are here because we want to deliver a policy or create a new approach. The partnership arrangements lead to co-operation. The days of ambivalence are becoming fewer and there is less indecision about whose responsibility a person is. Although all the problems have certainly not been solved, they are withering on the vine. Health and social needs are being handled holistically by partnerships such as mine, and we are achieving a much higher quality of care and support.

The director of social services for Stockton has said:

"Labour has done a lot",

adding that local flexibility was liked. The Secretary of State's remarks about freedom for local hospitals and local social services will provide the opportunity to develop services that respond to local needs. Stockton's social services director warmly welcomed that, and believed that it showed that his staff's professionalism was being recognised. The director said that they believed that a relationship of trust was beginning to develop.

This is not pie in the sky; it is something that we hope to achieve. We have to start somewhere, and my local authority is starting a positive relationship with the Government because the Government have given them the opportunity.

My local authority has adopted a principled approach to helping the health and social needs of the elderly in a care package known as homes for life. There is determination to establish a service that encompasses the needs of all older, vulnerable people within the broader community, and in which the richness of being part of a community remains. The elderly and the vulnerable have rights and they must have easy access to family and friends. Independence must be a fact of life. This well-rounded and well-thought-out policy maintains the individual's connections with the community. It should not require two bus journeys for a family to visit an elderly person, or a difficult journey for an elderly person to visit their family.

There are problems, and it is early days. We are in a period of transition, but at least we are in that period. Homes for life is a clear and principled approach, and a policy that will support independence.

I wish to respond to the arguments about the private care sector and to refute categorically the challenge in the motion that Government policy has mishandled, and misunderstood, the home care sector, causing a loss of homes and beds. In Stockton, we have not lost any beds. I am the first to acknowledge that the relationship between the local authority and the private sector is not always easy, but no beds have been lost. Concern has been expressed about the amount of money that the local authority is prepared to pay for care and support of the elderly, but those concerns are now being resolved. Private owners are saying that that is because the Government have carefully organised the funding of social services in Stockton to allow private owners to pay appropriately. There has been disagreement, but it has been resolved and negotiations have taken place. Therefore, people in Teesside will wonder what on earth the Liberal Democrats have been talking about.

We do not have bed blocking either. We have two elderly people who have to be placed carefully in residential care.

Does the hon. Lady ever read a newspaper?

The hon. Gentleman thinks that this is funny. Good for him. The reality is that local people do not laugh about it. They are very grateful. As I was saying we do not have a bed blocking problem, but we have two people who need places. Where is the crisis? From the perspective of my constituency, my council and local private homes, the Government have achieved an innovative care system that is significantly better financed. It has a structure based on a partnership of equals between the public and private sector. It is a service based on the principle that people's individual needs, not profit, come first. It is also accommodating high standards. The local people know that it will take time for all those characteristics to become evident, but they know that we will persist until they do.

There is little evidence in Stockton of shortage of beds or bed blocking. In fact, there is much evidence that our policies are competent and achieving a much better service. There is no crisis. Unfortunately, in tonight's debate, the Liberal Democrats have been playing to the gallery. The language they have used is also used by my Liberal Democrat colleagues—and they are colleagues—on Stockton council. During a council debate, when the homes for life policy was introduced, it was warmly welcomed by the leader of the Liberal Democrats. However, when public opinion began to question the policy and the debate became a little bumpy, the Liberal Democrats immediately decided that a change of mind was the most appropriate response that they could make. I suggest that opportunism is the last thing required when a policy is being developed to respond to the needs of the old, the ill and the vulnerable in our society.

Stockton's approach—"Homes for life, a life in your own home"—is appropriate. That policy came about because the Government have allowed us to innovate and to challenge a culture; they have allowed us to say not only that we want quality, but that independent, individual lives should be accommodated in the social and health care system.

9.5 pm

If only the whole country were like Stockton—it sounds like a paradise. I have never thought of Stockton in that way, but I learned much tonight.

The test of a civilised society is surely the way that it cares for its older people. Although I agree with the hon. Members for Stockton, South (Ms Taylor) and for Wakefield (Mr. Hinchliffe) that we should facilitate independent living wherever possible, it is not appropriate for everybody. Ideally, there will always be a place for residential care in a mix of provision.

At present, the vast majority of people who go into residential care go into the private independent sector, so the state of that sector should be of concern to us all. Despite the paradise in Stockton, that sector is in a state of developing crisis and I shall explain why.

The sector has suffered underfunding for many years. In Norfolk, year-on-year fee increases are below the rate of inflation. Last year, the Labour-Liberal Democrat council budgeted for social services spending of £13 million above the standard spending assessment, but it still overspent by £1 million.

The competing demands faced by social services departments put those departments in an impossible position—for example, as regards their child protection work. In Norfolk, we experienced the awful and desperately sad death of Lauren Wright. Part of the problem is that there are insufficient social workers. I pay tribute to the work they do, but there are not enough of them. Furthermore, there is not enough money to pay for an adequate number as well as providing sufficient funds for the care of elderly people.

In addition to the underfunding in fees from social services, the costs incurred by care homes over the years have continued to rise. They have had to cope with the minimum wage and the introduction of holiday pay. I fully support both those things, but they must be funded. The increases have not been enough to fund those extra costs.

On top of that, there are the new care standards. I repeat the comments already made by my colleagues on the Liberal Democrat Benches. We support national care standards. They are important, but it is essential that they do not act as a straitjacket that makes it impossible for inadequately financed care homes to meet them, with the result that the homes become unviable and have to close.

The effect of all those measures is that a substantial number of homes have already closed—35,000 beds have been lost nationally during the past three years—and there has been a dramatic drop in the number of new registrations. We have also heard about the knock-on effect for the NHS where blocked beds inevitably result in cancelled operations—despite the situation in Stockton—and longer waiting lists.

The homes that are most affected are those that rely on social services-funded residents, so the most disadvantaged residents lose out most as a result of the current inadequate funding. Furthermore, those residents also lose out owing to the problems in the underfunded NHS—problems such as cancelled operations. They are unable to opt out as people with more money are able to do.

Finally, I shall comment on the situation facing care homes for younger adults—residents with learning difficulties. That sector is the real Cinderella service. Recently, I visited an impressive home called Abbottswood lodge, which is situated in Swanton Abbott in north Norfolk. It is highly regarded locally and has received very good reports from social services inspection teams, but staff there are very worried about the impact of the new care standards on the home. They are especially concerned about the limits on the size of units and rooms in the home. They feel that the overly prescriptive approach will have a severe impact on their ability to continue to operate as a care home for younger adults.

The home is wonderful, an old vicarage with delightful grounds. However, the extent of the grounds cannot be taken into account in the prescriptive rules of the new care standards. The introduction of the national care standards requires sensitivity and flexibility.

It is time for some joined-up Government thinking, to quote a new Labour phrase. There needs to be a whole-systems review, so that we can judge the impact on the health service and on the care sector. It is time too that the whole system received proper and sustained funding.

9.11 pm

I shall be brief, but various points remain to be highlighted.

The problem with the debate is that it is stuck in the past, whereas we should be looking to the future. However, I am not going to live in denial: there are problems in Gloucestershire. Recently, I met care home representatives from my constituency. Homes have closed there for a whole range of reasons, some of which have been noted already.

Yesterday, Lord Sutherland, Baroness Greengross and Ian Philp from the national service framework for older people addressed different meetings. Their various perspectives on the matter allowed hon. Members who attended the meetings to see the good things that are happening, as well as some of the problems with which we are all familiar.

My main aim in this debate is to make it clear that I think the mistakes that have been made are not necessarily the fault of this Government, or even of their predecessors. Although we could do some things better, the problem is that many previous Governments have failed to overcome the barrier between social care and health care. My hon. Friend the Member for Wakefield (Mr. Hinchliffe) made that point very clearly.

The Conservative Government may not have been responsible for that mistake but, as I noted in an intervention, it was made worse by the way in which they tried to reallocate funds to personal social services as a result of the Griffiths report. As a result, the NHS was removed from the equation to too great an extent, and there was a failure to understand that it was not a mixed economy of care.

Moreover, that period saw the beginning of the end of county-led provision, certainly in my county. I believe that that was wrong. There was also a failure to realise the opportunities for the mutual sector. I hope that that matter will be looked at again. There is a role for mutuality in this sector, as it overcomes some of the distrust that people feel for the private sector.

I do not want to belittle the private sector. Some of my friends run care homes, and they are open about the fact that they want to make a profit. However, the private sector is not the only solution. We must give credence to mutuality, which is something from which we could gain considerable benefit.

The debate has already touched on various geographical and historical problems. Interestingly, the latest figures from Laing and Bouisson show that demand has not continued to rise exponentially, but has been capped. Perhaps that is a result of the way the funding mechanism operates, but alternatives are already being sought. Demand may grow as the population increases, but we must take demand into account as well as supply. The problem is not merely one of capacity: we must take account of what people want and where they want to go.

There is also a difference in expenditure. Again, I understand from House of Commons figures, drawing on Laing and Buisson's work, that approximately £9 billion is spent in the residential nursing sector, compared with just over £1 billion in the domiciliary care sector. Is that the right balance? Many hon. Members would argue that it is not, and we need to find a difference balance.

In trying to find some solutions, I would argue that the NHS has already moved too far out of the personal care sector. The NHS is invaluable precisely because it is the most trusted of organisations. Despite its various problems, it has a notion of how to deal with people, and we must ensure that that is carried into the personal care sector.

As I have said before in the Chamber and in Westminster Hall, there are different ways in which we can ensure that people are properly accounted for when they enter the system. In the United States, systems called minimum data sets provide a much better understanding of how people in the system can be moved more effectively. I hope that the Government will consider some of the pilot work that has been done in the Bristol area and try to roll it forward towards a national system. That involves using information technology effectively, but if that can be done people will not be lost but will be funded appropriately and they will feel that they are being listened to much more.

Another concept worthy of mention is that of supporting people, which has not been mentioned at all in this debate. It is important because for the first time it genuinely locks housing into social care and health provision. People often want to go home when they leave hospital—they do not want or need to go into the residential or nursing home sector—but perhaps cannot do so for the simple reason that their homes have not been adapted, and we must highlight that problem. I have done a lot of work locally and nationally with Care and Repair, and through other home improvement agencies it can lock into that exciting debate.

A final issue is that of intermediate care. I shall not try to define it here tonight; the Government have much cleverer people than me working on that, but we could consider the way in which the NHS and others can provide the appropriate facilities for older people and the other groups mentioned—the vulnerable people—by pursuing intermediate care.

To give it a quick plug, Standish hospital will no longer be used for acute provision after 2004, so it could be considered for use as an intermediate care centre. In the years to come, I shall write to Ministers to advocate that solution, but that much-loved institution should be considered properly. If such things happen in the NHS, some of the pressure will be taken off the care sector, and we shall ensure that we do not view the solution as lying entirely in private provision. That would be neither fair nor realistic to the private sector; nor would it represent an appropriate use of state resources—people's resources—and we could have a much better system accordingly.

9.18 pm

I shall be very brief. I am one of those hon. Members who still has not decided which way to vote this evening or, indeed, whether to abstain, but I have found all the contributions extraordinarily interesting and very helpful.

I am delighted that we have been reminded of the importance of care in the community, yet I am pleased that the hon. Member for North Norfolk (Norman Lamb) reminded us that care homes are essential. One of my constituent's comments about his father were published in the Daily Mail. My constituent said:

"He spent two weeks in residence and enjoyed it so much that he decided to continue to live there."

So care homes are right for some people.

I welcome the opportunity to expose the enormity of the task that the Government face. I agree with them absolutely that investment alone is not enough unless it is matched by reform, but the enormity remains. If the £300 million investment announced in October is broken down into counties, Worcestershire received £713,000. If all that money had been spent on residential care, it would have been enough to provide less than one extra place a week. I am not criticising the amount, but merely pointing out the enormity of the task.

The cost of care is not met by social services in my county. I would almost like to arrange a visit to Stockton to see how it does that. Care homes in my constituency hope to take large numbers of fee-paying patients because they subsidise those who are paid for by social services.

I shall end my brief contribution with a plea from the chair of the care homes association in Hereford and Worcester that the Minister might have seen. He writes:

"In 2001/2 Worcestershire receives £53 million in respect of payments for Residential and Nursing Care and Domiciliary Care. However, due to political decisions in the Council Chamber, only £33 million is used for the purpose intended".

Will the Minister investigate that claim? If it is correct and if it applies to other parts of the country, will she take action?

9.21 pm

I enjoyed the news from God's own county. It is very much a contrast to life in Surrey. My father is 80 and lives in Yorkshire and I have told him. "Don't come south. Stay in Yorkshire." [HON. MEMBERS: "Go to Stockton."] I am not going as far as Stockton.

Many Members have spoken about what is almost crisis management and the problem is not that we resent it if care homes make a profit. Any business can stay in business only if it makes a return on its investment. The cost of living and the price of property is so high in Surrey that investing in care homes involves a bad return on investment. That is the problem.

We still want good-quality care homes and we support high standards in them. However, we recognise the need to fund the provision of that care. Those of us who have constituents who have been bedridden for more than a year as a result of poor care have plenty of reason to desire improvements to the standard of nursing in some care homes.

We are in crisis, but the Minister would be hurt if I did not recognise the contribution that "cash for change" has made to bed blocking in Surrey. Even though, as in other areas, there have been massive queues in accident and emergency departments and even though people have been virtually imprisoned in wards in the Royal Surrey hospital, some improvements have been made. Notwithstanding that, we need ongoing planning so that care homes can plan. Furthermore, we need the money to train and pay care workers to look after people in their homes. Without that funding and without the recognition that counties cannot pay with money that they do not have, we will make no progress.

Some care workers in Surrey work for 10 hours a day, unpaid for some of the time. They do not have enough time in the day to look after people, and that is not good enough. We need to treat people with decency. One of the problems is that there are not enough care workers in Surrey because they cannot afford to live there. However, we cannot bring them in from overseas, as we can nurses, because they are not at national vocational qualification level 3. People advertise throughout the country, but no one responds and we cannot bring people in from elsewhere. Consideration must be given to that point.

We have not touched on care for those who care for others. Although we have considered the revolving-door syndrome and bed blocking, a report commissioned by Help the Aged shows that one third of all carers over the age of 75 provide 50 hours of care a week. Three quarters of older people who live with the person for whom they care receive no regular visits from health or social services. One in 10 older carers who live with the person whom they look after receive home care themselves. Carers over 75 are more likely to be providing intensive care than those between 60 and 74. By 2031, nearly one in three of the population will be over 60.

We all want people to lead happy and healthier lives, but we have to recognise that we not only have to meet the current crisis but have to plan for the long-term needs of the population. We need long-term, consistent planned growth, based on realistic costs of providing social care of a quality that not only meets Government objectives, but provides plain and common decency for our older people.

9.25 pm

The Government amendment implies that all is improving in care for the elderly. The simple truth is that it is not. Every word of the Liberal Democrat motion will ring true with social services departments, the health service and, more important, users of the services and their carers up and down the land—perhaps with the exception of Stockton.

The Government are not doing enough in the round and the problems start with local government finance. I speak as a past chair of social services in Stockport, where we welcomed many of the social care modernisation reforms demanded by the Government. We are proud of working jointly with the health service and the voluntary sector, and we improved our management and record keeping. Basically, we did our best and the social services department in Stockport continues to do its best against both a backdrop of structural problems associated with local government funding of social services departments and a general backdrop of underfunding of local authorities in many parts of the country.

I wish to explore two issues. The first is the structural problem caused in budgets by the chronic underfunding of children's services. In Stockport, crude standard spending assessment measures do not reflect the levels of need of children within our community. The knock-on effect of meeting the needs of children's services is to steal money from older people's services, with the resultant increases in gatekeeping. That reduces social services departments' ability to provide the right service at the right time for the elderly. All too often, money has to be spent on firefighting instead of ensuring a dignified and supported older age for the infirm. The lack of funding in older people's services leads to bed blocking and to entry to residential care, two outcomes that the vast majority of older people and their carers do not want.

The second issue that I wish to explore is the shortsighted way in which the Government tackle the problems. By the time someone becomes infirm, it is almost too late to engage in issues to do with lifestyle and diet. All the evidence indicates that as our young people get older, their sedentary lifestyle and poor diet, which we know is causing obesity, will lead to greater dependency when they reach an older age. The Government are engaged in pilot schemes such as the school fruits initiative, but they need to do much more to counteract the insidious effect of junk food and drinks machines in school corridors and sports centres throughout the country. Young people used to engage in more vigorous activity in schools, and more needs to be done to establish a better balance between activity and academic work in their lives.

In addition, more attention needs to be paid to the difference that local authority leisure services can make. France, for example, spends eight times as much on sport per head as we do. Leisure services are also often starved of cash because of the needs of other departments, like social services, that are busy firefighting.

I am disappointed that four and a half years on, a Government with a big majority have not come up with proposals to replace the discredited local government finance system. Until they do, SSAs will continue to fail to meet people's needs and the improvements demanded by the Government cannot be implemented.

9.29 pm

We have had a good debate, started by my hon. Friend the Member for Sutton and Cheam (Mr. Burstow), who stated the position clearly and backed up his remarks with evidence. It is important to provide data as well as solutions to the problems we see.

Using House of Commons Library figures derived from Government answers, my hon. Friend demonstrated that there are bottlenecks and delays in the health service. In the last year, 1,400 years of elderly people's time has been spent waiting to get out of hospital. The Minister may dispute those figures—perhaps she thinks it is only 1,300 years. However, the facts are clear and the Government must acknowledge them before they can claim that they are starting to solve the problem.

My hon. Friend demonstrated the loss of beds and homes in the care sector. He pointed out the cash shortages affecting many social services authorities, leading to a macabre game of musical beds wherein people who require funding can be placed only when one or more care home residents who are funded die. What a sad game to which to subject the elderly people of this country.

My hon. Friend further demonstrated the diminishing eligibility criteria caused by cash shortages, which lead to ever fewer people qualifying for any help from social services, as well as the staff shortages, vacancies and high turnover. Sensibly, he called for a review of the social care sector. In a thoughtful contribution, the hon. Member for Stroud (Mr. Drew) pointed out how much thinking is needed in that respect. An independent review of how to get best practice across the country, new thinking and the funding required is long overdue.

Not only have the Liberal Democrats come up with that proposal, but we are prepared to state that we would put in extra investment and to say where that funding would come from. We have talked about extra investment to tackle delayed discharges. According to figures given by the Chairman of the Select Committee on Health, tackling delayed discharges in one year would release £720 million. In addition, we would free councils to raise revenues, as voters elected them to, to meet the needs of local people.

Unlike the Labour party, the Liberal Democrats said at the last election that we would be prepared to increase taxation, including setting a new top rate of 50p in the pound for incomes exceeding £100,000. According to Government figures, that would yield an additional £3.7 billion to spend on elderly people, including those in health care settings.

Ministers may disagree with asking better-off people to pay more to help the most vulnerable in society. I think that to do so is wrong, unreasonable and a betrayal of their principles. They cannot deny that we went into the election with a costed manifesto to deliver whatever cash the Labour Government had to spend plus £3.7 billion derived from having the courage to ask the better-off to help to protect the most vulnerable people in our society.

Ministers and their yes men and women on the Back Benches should be ashamed of having lacked the courage to say before—not after—the election that taxes would have to rise. They ruled out the only fair way to raise those funds, which is progressive direct taxation rather than stealth taxes. I suspect that many Labour Members wish that their Government's policy was different.

The Minister's response was astonishing, but nothing we have not heard before: "Crisis? What crisis?" She was eloquently and loyally—I hope it is worth it—supported by her hon. Friend the Member for Stockton, South (Ms Taylor), who claimed that there was no problem of elderly people requiring earlier discharge or better services. The hon. Lady was prepared to say that there was a "demographic problem" but added that these are the early days of the Labour Government. if these are the early days, lord help those who need help when the Government have got into the swing of things. She said that there were no lost care homes and no problems, and only two elderly people were suffering from delayed discharge. The Government's new policy to modernise the health care system will be to tell people who want to be discharged from hospital to go to Stockton.

By contrast, we heard testimony from my hon. Friend the Member for North Norfolk (Norman Lamb) about the problems in Norfolk, from my hon. Friend the Member for Cheadle (Mrs. Calton) about the problems in Stockport, from the hon. Member for Wyre Forest (Dr. Taylor) about the problems in his constituency, and from my hon. Friend the Member for Guildford (Sue Doughty) about the problems that still exist in Surrey. In my own constituency, care homes that had survived years of Tory cuts had to close under a Labour Government, and now there is a shortage of beds and a huge increase in the number of delayed discharges in my local hospital.

It is remarkable that the Government refused to acknowledge those problems. The Minister admitted that there was a need to stabilise the private care home sector. If it needs stabilisation, that implies that there is already a problem. What does stabilisation mean? It means rescuing the situation, and she should admit that her limited funding is designed to do that.

The Minister's response was clever but unfair. She chose to centralise praise for the Government every time new money was announced, but decentralise blame to local councils when underfunding led to cuts in provision. She was supported in her tactic of blaming local councils—a few of them Liberal Democrat, but most of them not—and attacking the Labour-led Local Government Association by the hon. Member for Eastbourne (Mr. Waterson) and the hon. Member for Isle of Wight (Mr. Turner), who did not even remain in the Chamber to hear the rebuttal of his weakly put point.

The Minister talked about £300 million to tackle delayed discharge and to stabilise the private care home sector. That is not £300 million a year: it is £100 million in the first year and £200 million in the second. We are used to such double counting, but social services departments despair of it. We do not even know whether that will be recurrent. We certainly know that it is not the £700 million that the independent King's Fund has established is required, and we would provide at least as much by releasing those acute beds, as the hon. Member for Wakefield (Mr. Hinchliffe) said.

The Minister does not put enough money in, but claims praise for the money that she does provide. She blames hospitals for delayed discharges by naming and shaming them, and by giving them zero rating when they are unable to discharge patients and do not have the capacity to admit others.

Ministers stand at the Dispatch Box and praise staff in the care home sector, but when care homes cannot afford to pay staff adequately they blame the employers. The Minister claimed that 5 per cent. more people receive intensive domiciliary care, and praised the Government for that. She blamed local councils for the fact that 19 per cent.—93,000 people—receive less care. She probably thinks that it is a triumph that people who do not qualify for care under the tightened eligibility criteria are happily living independent lives, but they are heading more quickly towards high-level care because of the failure of early intervention.

The Minister claimed to have tackled the problem through the establishment of the high-level, strategic commissioning group. Bully for her! That group has come up with fantastic ideas such as long-term contracts. Of course long-term contracts are a good idea, but long-term funding to go with them would be helpful.

The contribution of the hon. Member for Wakefield was interesting. At least he accepted that there was a capacity problem. Like us, he accepted that the ideal would be independent living and less institutional care. Although care homes are suitable for some people, we should not assume that they are suitable for everyone.

The hon. Gentleman said that he disapproved, as he has always done, of the structural divide between health and social care: what the Government describe as a Berlin wall, and what my local trust and social services department describe as a Berlin trench, as they are digging to find the funds to fulfil the extra duties imposed on them by Government. We agree with the hon. Gentleman on that point. He accepted that 6,000 people suffer delayed discharge on any one day, and he pointed out that it would save £720 million if that problem were tackled. Again, he agrees with us and our motion.

The hon. Gentleman said that social services were underfunded compared with the health service, and that the real-terms increase in social services was not keeping pace. Again, he agrees with our point of view. He criticised the Government for their non-evidence-based love affair with private sector provision of social care. He supports us in almost everything, but then announces that he will support the Government in the Lobby tonight. Wheels within wheels. If the hon. Gentleman disagrees with the Government but will vote for them when the crunch comes, it is not scrutiny but tribalism. I say with the greatest respect, because the hon. Gentleman is bigger than me, that those who agree with our criticisms ought to follow the logic of their position.

The hon. Member for West Chelmsford (Mr. Burns), one of the few Conservative Members in the Chamber tonight, confirmed in an honest speech that his party in opposition is committed to funding only nursing care, not personal care. [Interruption.]

I am not going to change my mind. I shall state my position clearly so that there can be no misunderstanding by Liberal Democrats, because we all know what Liberal Democrats do in our constituencies. I said that, like the Government, the Conservative party fought the last general election on a policy of free nursing care, but we did not have a policy of free residential care.

I am glad that the hon. Gentleman repeated his position; I just wish that he had done so a bit more quickly. The hon. Gentleman does not understand, or perhaps he does, that such a policy discriminates against elderly people. It subjects them to the degrading assessment of whether bowel care, catheter care and stoma care is nursing care—that is, a requirement of their health needs—or personal care. What a way to treat elderly people. The Government are saying to them, "If that care need is delivered by a nurse, we'll pay for it, but if it is not, you'll pay for it. Having saved and paid taxes all your life, you will pay for care that you were told would be free from the cradle to the grave."

Does my hon. Friend agree that the policy also discriminates against elderly people who are not only physically but mentally ill?

Absolutely. We know that people who suffer from dementia will have a mixture of personal care needs and nursing care needs, and it is degrading, discriminatory and invidious to try to make a distinction between them. We are prepared to say that we would fund personal care, and we have said where the money would come from. I know that there are Labour Members who know, in their heart of hearts, that that is the right policy.

The hon. Member for West Chelmsford did us the favour of quoting Liberal Democrat research, the aim of which, as I think he accepts, was to show that people still have to sell their home to fund their personal care even though the Labour party, in opposition, used to claim that that was a scandal. Very little has changed.

The charges that the Minister must answer are clear. Discharges are delayed, beds are blocked and elderly people have to wait to receive suitable care in an unsuitable setting, which means that other elderly people who require that care have to wait to get into a hospital bed. Indeed, in many places, they have to wait in corridors, with the resulting lack of privacy. Who would have thought that five years into a Labour regime we would see wards made up in corridors, with no screens, no privacy and no dignity, and health care staff struggling to provide the care that patients need?

The Government stand charged with presiding over a system in which 19 per cent. fewer people are receiving social care because of the shortage of cash. They stand accused of under-resourcing that threatens the quality standards that Liberal Democrat and Labour Members want to see. The Government are committed to more tax cuts for the better-off at the expense of services for the less well-off. They are denying elderly people the free provision of personal care on the NHS and subjecting them to degrading and invidious assessments. They are overseeing the tightening of eligibility criteria by local councils, which they are making the scapegoats.

We want to hear the Minister accept that there is a problem, that funding as well as reform is needed and that the Government have the courage to say where that funding will come from. We believe that the better-off who have done well under this Government should help to provide care for the vulnerable elderly who are getting a raw deal from the Government.

9.44 pm

The Government believe strongly in giving people the right treatment at the right time in the right setting. We have had a wide-ranging debate, but I was particularly disappointed by the contributions of the hon. Member for Sutton and Cheam (Mr. Burstow), who opened the debate, and the hon. Member for Oxford, West and Abingdon (Dr. Harris), who closed it for the Liberal Democrats.

There were good contributions in between, but it was extremely disappointing that the hon. Member for Sutton and Cheam used incredible and unbelievable figures, from which he extrapolated beyond the bounds of comprehension to talk about 5,000 years and 88,000 operations. Where would he get the surgeons to do those 88,000 operations? He was utterly unreasonable and went on to insult care home staff in the most appalling manner that I have witnessed in the Chamber for a long time. To talk about them as rejects from Tesco and McDonald's, when they are putting in time and energy and showing commitment to looking after people in care homes, is dreadful.

I am disappointed that Liberal Democrat Members spoke almost exclusively on behalf of care home providers. That is nothing new. When the hon. Member for Oxford, West and Abingdon moved a motion at his party conference last year, he spoke 26 times about doctors, nurses and staff, but only once about patients; they are important, but he spoke about them only once.

I know that the hon. Lady follows the Liberal Democrat conference carefully; I just wish that she would take note of the fact that the motion was about staff in the NHS. When we talk about staff in the NHS, we talk about staff, not stabilisers or modernisers.

When we talk about partnership, we talk about a partnership of staff and patients working together to shape services; that is the difference between the Liberal Democrats and the Labour party.

We appreciate that the independent care home sector is facing a number of challenges; we are certainly not in denial about the issue. However, the position is nothing like the one represented by Opposition Members. Let us have a bit of honesty in the debate—it would make a refreshing change for the Liberal Democrats. Figures have been bandied about; the loss of care home places was said to amount to 50,000 beds. It went down to 35,000 beds, but the true figure is 19,000 beds. Those figures are ludicrous. I am glad that Liberal Democrat Members reduced their first figure by about half; perhaps by the end of the debate we shall have the proper figures. They did not take into account the fact that 33,500 beds were created between 1997 and 2000 by new registrations. They should be clear about the figures that they submitted.

Our policy is to allow people to remain as independent as possible and be supported at home, which is why 1.5 million people are receiving care packages of various types in their own homes. Last September, the number of people receiving intensive home care packages was 3,500 higher than it was the previous year. My hon. Friends the Members for Wakefield (Mr. Hinchliffe), for Stroud (Mr. Drew) and for Stockton, South (Ms Taylor) spoke imaginatively and creatively—[Laughter.] I am sorry, it appears that Liberal Democrat Members do not recognise imagination and creativity when it stares them in the face. My hon. Friend the Member for Stockton, South spoke passionately about the local partnership in her community that is beginning to design facilities around the needs of patients. My hon. Friend the Member for Wakefield said correctly that we must not judge our success in community care by a simple number-crunching exercise involving the number of beds. We must look at the kind of services that we provide to support people in the community.

My hon. Friend the Member for Stroud mentioned, extremely importantly, the role of the mutual sector in drawing up new solutions to those problems. The Secretary of State in his speech yesterday talked about new models of care. The mutual sector has a role to play. I have recently been made aware of a project in St. Helens in which the co-operative movement is looking at providing a range of services—not just residential care, but supported housing with care services in place. When someone begins to become frail, they can get day care; when they are a little more frail, they can get sheltered housing; when they need residential care, they move into that; when they need nursing care, they move into that. They do all of that within the same village community in which their carers and families are involved. That is the kind of new model of care that local people want, and which the Government, with their creativity and imagination, will begin to put in place. The Liberal Democrats have simply spoken about more money for business as usual and the same old system. That simply will not wash.

Solving delayed discharges is important to us and we have made tremendous progress. Since last September there has been a 10 per cent. drop in the national number of delays. We are keen that the figure should fall even further, which is why we announced the investment of £300 million. I am pleased to tell the House that by 6 January 501 beds had been freed across the country.

I thank the Minister for graciously giving way. She makes the situation sound rosy, but can she explain the following statement from all 15 local authorities in the south-west, including Labour-run local authorities? They state:

"Local Authorities are placed in an impossible situation with no recourse other than to hold back spending on older people in order to provide marginally safe and adequate services for children and other adults."

Is that the rosy garden that the Minister is painting?

I was not painting a rosy picture. I acknowledge that there are problems. The Government are not in denial. We are dealing realistically with problems in the community. If local authorities are taking that position, after they have received extra resources from the cash for change programme, it is outrageous that they are not putting in place services for older people. We will look into the matter.

About 2,500 more people will be able to leave hospital at the appropriate time as a result of the extra funds that we have allocated. The hon. Member for Eastbourne (Mr. Waterson) stressed the need to ensure that that happens in his area. I shall examine the distribution of the allocation of those funds in his area, but I understand that the Conservative-controlled county council there has cut grants to carers, leaving them without respite care. That is a serious matter, which will not help the situation.

Before the hon. Lady hands out brickbats, she should bear in mind that a few short months ago, the Conservatives took over a social services budget in chaos, brought about by the Liberal Democrats. I hope that she will also address the point that I made—that the Government changed the SSA calculation for East Sussex to disadvantage central Government funding for older people.

If the hon. Gentleman wants to argue with the Liberal Democrats, I shall not intrude.

The agreement last year, "Building Capacity and Partnership in Care", set out a new way of providing long-term care for older people. It envisages long-term partnership, joint commissioning, new forms of service and the development of new models. It will give us the sustainable system that we need. The hon. Member for Cheadle (Mrs. Calton) spoke of the need for long-term planning. That is the aim of the agreement.

Several hon. Members mentioned free nursing care. On 1 Oct 2001 we delivered on our commitment to provide free nursing care for everyone in England. Some 42,000 people will save money on their nursing home costs. We are moving away from a means-tested system of nursing care to one based on clinical need.

We have been much maligned for failing to follow the Scottish Executive and offer free personal care to all, but to implement free personal care for everyone in England would cost approximately £1.5 billion a year. I know that my hon. Friend the Member for Wakefield takes a different view, but we decided in the NHS plan to make £1.4 billion available per annum to improve services and standards for older people. Spending a vast amount of public money on free personal care would not guarantee improvements for older people. We firmly believe that we have targeted resources so that those most in need will receive high-quality care at no cost. It is important to decide the right priorities. It is right for a Labour Government to target funds on those in most need.

The Minister defended her refusal to follow up the recommendations of the majority of the long-term care commission by saying that the funding required would have to come from other vulnerable groups. What about the proposal to raise the funding from the better-off in society through fair, progressive, open taxation?

As usual, the Liberal Democrats want to face both ways at once. One could say that they want to have their cake and eat it. They want to ask the better-off to pay and to implement free personal care that will, in many cases, benefit those who are better off rather than those who are in most need. There is a fundamental contradiction in their policies.

It is all too easy to spread a mood of doom, gloom and crisis. I challenge Opposition Members to do some hard thinking. I know that that is not easy for them. It is much easier merely to complain and sit on the outside carping and criticising than to come up with constructive new ideas. I am asking them to propose new models to put people at the centre of the service and to design facilities around their needs, rather than to force them into ideas and traditional care that can sometimes rob them of their dignity and independence.

This debate has highlighted some very real differences between the Labour Government and the Liberal Democrats. We put patients and the public first; they put providers first. We want creative and imaginative solutions; they want more places in nursing homes. We want to promote people's independence; they want them to be passive. We want a partnership between the national health service, local government, the voluntary sector and the private sector; they simply want to concentrate on care home numbers. We are forward looking; they are stuck in the past. We are creative and positive; they are negative. We are committed to reform; they have the same old ideas.

There is a lot more for us to do, but we are putting in the investment and reforming the services. The two must go hand in hand if we are to deliver the top-quality care to which people are entitled in this day and age. As ever, the Liberal Democrats are guilty of political opportunism of the worst kind. They just want more money, as usual—the same old record—but they do not want any reform; they just want the same old system.

The Tories are just as bad, but they are not even prepared to put the money in. The only thing that the hon. Member for West Chelmsford (Mr. Burns) could find to talk about was age discrimination. I am delighted to tell him that the Government's national service framework addresses for the very first time the rooting out of age discrimination throughout the national health service.

The hon. Member for North Norfolk (Norman Lamb) again raised the very sad case of Lauren Wright. I spoke in the Adjournment debate on the case and, as I recall it, the director of social services in the area was honest and open, and recognised that his problems stemmed not from a lack of funding, but from the systems that were in place and the difficulties of joining up the different parts of the care system. The hon. Gentleman needs to be very careful about putting the blame on that individual.

The hon. Member for Wyre Forest (Dr. Taylor) said that he had not yet made up his mind about how he was going to vote at the end of the debate. He now has precisely two minutes in which to do so, so I hope that he can make the decision fairly soon. It is right that his local council will set its priorities. I am afraid that political decisions are made about priorities—that is what we are all here to do and that is what will happen.

The hon. Member for Guildford (Sue Doughty) said that we were in crisis, but then recognised that lots of improvements were being made because of the cash for change money. I do not know whether she thinks that we are in crisis or not. She seemed very confused about that, but I am pleased that she has welcomed the improvements in her area that have resulted from the Government's action.

It is this Labour Government who have the courage to invest in better services and to challenge all our partners in local government, the national health service and the independent sector to work together in new ways to deliver for the people whom we represent. The Liberal Democrats said in their manifesto for last year's general election:

"Three simple words. Freedom, justice, honesty. These sum up what the Liberal Democrats stand for."

We have certainly seen tonight just what they stand for. Three simple words sum them up: cynicism, confusion and opportunism. I ask the House to reject the motion.

Question put, That the original words stand part of the Question:—

The House divided: Ayes 60, Noes 314.

Division No. 135]	[9.59 pm
AYES
Allan, Richard	Kirkwood, Archy
Baker, Norman	Lamb, Norman
Barrett, John	Laws, David
Beggs, Roy	Llwyd, Elfyn
Beith, Rt Hon A J	Marsden, Paul (Shrewsbury)
Brake, Tom	Moore, Michael
Breed, Colin	Oaten, Mark
Bruce, Malcolm	Öpik, Lembit
Burnett, John	Pugh, Dr John
Burstow, Paul	Reid, Alan (Argyll & Bute)
Cable, Dr Vincent	Rendel, David
Calton, Mrs Patsy	Robertson, Angus (Moray)
Campbell, Gregory (E Lond'y)	Robinson, Mrs Iris (Strangford)
Campbell, Rt Hon Menzies (NE Fife)	Robinson, Peter (Belfast E)
	Russell, Bob (Colchester)
Carmichael, Alistair	Sanders, Adrian
Chidgey, David	Smith, Sir Robert (W Ab'd'ns)
Cotter, Brian	Smyth, Rev Martin (Belfast S)
Davey, Edward (Kingston)	Stunell, Andrew
	Taylor, Matthew (Truro)
Dodds, Nigel	Taylor, Dr Richard (Wyre F)
Doughty, sue	Thomas, Simon (Ceredigion)
Ewing, Annabelle	Tonge, Dr Jenny
Foster, Don (Bath)	Tyler, Paul
George, Andrew (St Ives)	Webb, Steve
Gidley, Sandra	Williams, Hywel (Caernarfon)
Green, Matthew (Ludlow)	Williams, Roger (Brecon)
Hancock, Mike	Willis, Phil
Harris, Dr Evan (Oxford W)	Younger-Ross, Richard
Harvey, Nick
Heath, David	Tellers for the Ayes:
Holmes, Paul	John Thurso and
Keetch, Paul	Mrs. Annette L. Brooke.

NOES
Ainger, Nick	Beckett, Rt Hon Margaret
Ainsworth, Bob (Cov'try NE)	Begg, Miss Anne
Alexander, Douglas	Bell, Stuart
Allen, Graham	Bennett, Andrew
Anderson, Rt Hon Donald (Swansea E)	Benton, Joe
	Berry, Roger
Anderson, Janet (Rossendale)	Best, Harold
Armstrong, Rt Hon Ms Hilary	Betts, Clive
Atherton, Ms Candy	Blackman, Liz
Atkins, Charlotte	Blears, Ms Hazel
Bailey, Adrian	Blizzard, Bob
Baird, Vera	Blunkett, Rt Hon David
Barnes, Harry	Boateng, Rt Hon Paul
Battle, John	Bradley, Rt Hon Keith (Withington)
Bayley, Hugh	Bradley, Peter (The Wrekin)
Beard, Nigel	Brennan, Kevin

Browne, Desmond	Grogan, John
Bryant, Chris	Hain, Rt Hon Peter
Burgon, Colin	Hall, Mike (Weaver Vale)
Byers, Rt Hon Stephen	Hall, Patrick (Bedford)
Cairns, David	Hanson, David
Campbell, Alan (Tynemouth)	Harris, Tom (Glasgow Cathcart)
Campbell, Mrs Anne (C'bridge)	Havard, Dai
Campbell, Ronnie (Blyth V)	Healey, John
Casale, Roger	Henderson, Ivan (Harwich)
Cawsey, Ian	Hendrick, Mark
Challen, Colin	Hepburn, Stephen
Chaytor, David	Hermon, Lady
Clapham, Michael	Hesford, Stephen
Clark, Mrs Helen (Peterborough)	Heyes, David
Clark, Dr Lynda (Edinburgh Pentlands)	Hill, Keith
	Hinchliffe, David
Clark, Paul (Gillingham)	Hoey, Kate
Clarke, Rt Hon Tom (Coatbridge)	Hope, Phil
Clarke, Tony (Northampton S)	Hopkins, Kelvin
Clelland, David	Howarth, Rt Hon Alan (Newport E)
Coaker, Vernon	Howarth, George (Knowsley N)
Coffey, Ms Ann	Howells, Dr Kim
Cohen, Harry	Hoyle, Lindsay
Colman, Tony	Hughes, Beverley (Stretford)
Connarty, Michael	Hughes, Kevin (Doncaster N)
Cook, Rt Hon Robin (Livingston)	Humble, Mrs Joan
Cooper, Yvette	Hurst, Alan
Cousins, Jim	Hutton, Rt Hon John
Cranston, Ross	Iddon, Dr Brian
Crausby, David	Illsley, Eric
Cryer, John (Hornchurch)	Ingram, Rt Hon Adam
Cummings, John	Jackson, Helen (Hillsborough)
Cunningham, Jim (Cov'try S)	Jenkins, Brian
Cunningham, Tony (Workington)	Johnson, Alan (Hull W & Hessle)
Curtis-Thomas, Mrs Claire	Jones, Jon Owen (Cardiff C)
Davey, Valerie (Bristol W)	Jones, Kevan (N Durham)
David, Wayne	Jones, Lynne (Selly Oak)
Davidson, Ian	Jones, Martyn (Clwyd S)
Davies, Rt Hon Denzil (Llanelli)	Joyce, Eric
Davis, Rt Hon Terry (B'ham Hodge H)	Kaufman, Rt Hon Gerald
	Keeble, Ms Sally
Dawson, Hilton	Keen, Alan (Feltham & Heston)
Dean, Mrs Janet	Keen, Ann (Brentford & Isleworth)
Dhanda, Parmjit	Kemp, Fraser
Dismore, Andrew	Khabra, Piara S
Dobbin, Jim	Kidney, David
Dobson, Rt Hon Frank	Kilfoyle, Peter
Donohoe, Brian H	King, Andy (Rugby & Kenilworth)
Doran, Frank	Knight, Jim (S Dorset)
Dowd, Jim	Kumar, Dr Ashok
Drew, David	Ladyman, Dr Stephen
Dunwoody, Mrs Gwyneth	Lammy, David
Eagle, Angela (Wallasey)	Lawrence, Mrs Jackie
Eagle, Maria (L'pool Garston)	Laxton, Bob
Edwards, Huw	Lazarowicz, Mark
Ellman, Mrs Louise	Leslie, Christopher
Ennis, Jeff	Levitt, Tom
Etherington, Bill	Lewis, Ivan (Bury S)
Fitzpatrick, Jim	Liddell, Rt Hon Mrs Helen
Fitzsimons, Mrs Lorna	Linton, Martin
Flint, Caroline	Lloyd, Tony
Flynn, Paul	Love, Andrew
Foster, Rt Hon Derek	Lucas, Ian
Foster, Michael (Worcester)	Luke, Iain
Foster, Michael Jabez (Hastings)	McAvoy, Thomas
Foulkes, George	McCabe, Stephen
Francis, Dr Hywel	McCafferty, Chris
Gardiner, Barry	McCartney, Rt Hon Ian
George, Rt Hon Bruce (Walsall S)	McDonagh, Siobhain
Gerrard, Neil	MacDonald, Calum
Gilroy, Linda	McFall, John
Godsiff, Roger	McGuire, Mrs Anne
Goggins, Paul	McIsaac, Shona
Griffiths, Jane (Reading E)	McKechin, Ann
Griffiths, Nigel (Edinburgh S)	McKenna, Rosemary
Griffiths, Win (Bridgend)	Mackinlay, Andrew

McNamara, Kevin	Salter, Martin
MacShane, Denis	Sarwar, Mohammad
Mactaggart, Fiona	Savidge, Malcolm
McWilliam, John	Sawford, Phil
Mallaber, Judy	Sedgemore, Brian
Mann, John	Sheridan, Jim
Marris, Rob	Simon, Siôn
Marsden, Gordon (Blackpool S)	Simpson, Alan (Nottingham S)
Marshall, David (Shettleston)	Skinner, Dennis
Marshall, Jim (Leicester S)	Smith, Angela (Basildon)
Marshall-Andrews, Robert	Smith, Geraldine (Morecambe)
Martlew, Eric	Smith, Jacqui (Redditch)
Meacher, Rt Hon Michael	Smith, Llew (Blaenau Gwent)
Meale, Alan	Soley, Clive
Merron, Gillian	Southworth, Helen
Michael, Rt Hon Alun	Spellar, Rt Hon John
Miliband, David	Squire, Rachel
Miller, Andrew	Starkey, Dr Phyllis
Mitchell, Austin (Gt Grimsby)	Steinberg, Gerry
Moffatt, Laura	Stevenson, George
Mole, Chris	Stewart, David (Inverness E)
Moonie, Dr Lewis	Stewart, Ian (Eccles)
Moran, Margaret	Stinchcombe, Paul
Morgan, Julie	Stoate, Dr Howard
Morris, Rt Hon Estelle	Strang, Rt Hon Dr Gavin
Mullin, Chris	Stringer, Graham
Munn, Ms Meg	Stuart, Ms Gisela
Murphy, Denis (Wansbeck)	Sutcliffe, Gerry
Murphy, Jim (Eastwood)	Tami, Mark
Murphy, Rt Hon Paul (Torfaen)	Taylor, Rt Hon Ann (Dewsbury)
Naysmith, Dr Doug	Taylor, Ms Dari (Stockton S)
Norris, Dan	Taylor, David (NW Leics)
O'Brien, Bill (Normanton)	Thomas, Gareth (Clwyd W)
O'Brien, Mike (N Warks)	Thomas, Gareth R (Harrow W)
O'Hara, Edward	Timms, Stephen
Organ, Diana	Tipping, Paddy
Osborne, Sandra (Ayr)	Todd, Mark
Owen, Albert	Touhig, Don
Palmer, Dr Nick	Trickett, Jon
Pearson, Ian	Truswell, Paul
Picking, Anne	Turner, Dr Desmond (Kemptown)
Pickthall, Colin	Turner, Neil (Wigan)
Pike, Peter	Twigg, Derek (Halton)
Plaskitt, James	Tynan, Bill
Pollard, Kerry	Vaz, Keith
Pond, Chris	Vis, Dr Rudi
Pope, Greg	Walley, Ms Joan
Pound, Stephen	Ward, Ms Claire
Prentice, Gordon (Pendle)	Wareing, Robert N
Prescott, Rt Hon John	Watson, Tom
Primarolo, Dawn	Watts, David
Prosser, Gwyn	White, Brian
Purchase, Ken	Whitehead, Dr Alan
Purnell, James	Wicks, Malcolm
Quin, Rt Hon Joyce	Williams, Mrs Betty (Conwy)
Rammell, Bill	Winnick, David
Rapson, Syd	Winterton, Ms Rosie (Doncaster C)
Raynsford, Rt Hon Nick	Wood, Mike
Reed, Andy (Loughborough)	Woodward, Shaun
Robertson, John (Glasgow Anniesland)	Woolas, Phil
	Worthington, Tony
Robinson, Geoffrey (Cov'try NW)	Wray, James
Roche, Mrs Barbara	Wright, David (Telford)
Rooney, Terry	Wright, Tony (Cannock)
Ross, Ernie	Wyatt, Derek
Roy, Frank
Ruane, Chris	Tellers for the Noes:
Ruddock, Joan	Mr. Tony McNulty and
Russell, Ms Christine (Chester)	Mr. John Heppell.

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith, pursuant to Standing Order No. 31 (Questions on amendments):—

The House divided: Ayes 301, Noes 60.

Division No. 136]	[10.12 pm
AYES
Ainger, Nick	Dhanda, Parmjit
Ainsworth, Bob (Cov'try NE)	Dismore, Andrew
Alexander, Douglas	Dobbin, Jim
Allen, Graham	Dobson, Rt Hon Frank
Anderson, Rt Hon Donald (Swansea E)	Donohoe, Brian H
	Doran, Frank
Anderson, Janet (Rossendale)	Dowd, Jim
Armstrong, Rt Hon Ms Hilary	Drew, David
Atherton, Ms Candy	Eagle, Angela (Wallasey)
Atkins, Charlotte	Eagle, Maria (L'pool Garston)
Bailey, Adrian	Edwards, Huw
Baird, Vera	Ellman, Mrs Louise
Barnes, Harry	Ennis, Jeff
Bayley, Hugh	Etherington, Bill
Beard, Nigel	Fitzpatrick, Jim
Beckett, Rt Hon Margaret	Fitzsimons, Mrs Lorna
Begg, Miss Anne	Flint, Caroline
Bennett, Andrew	Flynn, Paul
Benton, Joe	Foster, Rt Hon Derek
Berry, Roger	Foster, Michael (Worcester)
Best, Harold	Foster, Michael Jabez (Hastings)
Betts, Clive	Foulkes, George
Blackman, Liz	Francis, Dr Hywel
Blears, Ms Hazel	Gardiner, Barry
Blizzard, Bob	George, Rt Hon Bruce (Walsall S)
Boateng, Rt Hon Paul	Gerrard, Neil
Bradley, Rt Hon Keith (Withington)	Gilroy, Linda
Bradley, Peter (The Wrekin)	Godsiff, Roger
Brennan, Kevin	Goggins, Paul
Browne, Desmond	Griffiths, Jane (Reading E)
Bryant, Chris	Griffiths, Nigel (Edinburgh S)
Burgon, Colin	Griffiths, Win (Bridgend)
Byers, Rt Hon Stephen	Grogan, John
Cairns, David	Hain, Rt Hon Peter
Campbell, Alan (Tynemouth)	Hall, Mike (Weaver Vale)
Campbell, Mrs Anne (C'bridge)	Hall, Patrick (Bedford)
Campbell, Ronnie (Blyth V)	Hanson, David
Casale, Roger	Harris, Tom (Glasgow Cathcart)
Cawsey, Ian	Havard, Dai
Challen, Colin	Healey, John
Chaytor, David	Henderson, Ivan (Harwich)
Clapham, Michael	Hendrick, Mark
Clark, Mrs Helen (Peterborough)	Hepburn, Stephen
Clark, Dr Lynda (Edinburgh Pentlands)	Hermon, Lady
	Hesford, Stephen
Clark, Paul (Gillingham)	Heyes, David
Clarke, Rt Hon Tom (Coatbridge)	Hill, Keith
Clarke, Tony (Northampton S)	Hinchliffe, David
Clelland, David	Hope, Phil
Coaker, Vernon	Hopkins, Kelvin
Coffey, Ms Ann	Howarth, Rt Hon Alan (Newport E)
Cohen, Harry	Howarth, George (Knowsley N)
Colman, Tony	Howells, Dr Kim
Connarty, Michael	Hoyle, Lindsay
Cook, Rt Hon Robin (Livingston)	Hughes, Beverley (Stretford)
Cousins, Jim	Hughes, Kevin (Doncaster N)
Cranston, Ross	Humble, Mrs Joan
Crausby, David	Hurst, Alan
Cryer, John (Hornchurch)	Hutton, Rt Hon John
Cummings, John	Iddon, Dr Brian
Cunningham, Jim (Cov'try S)	Illsley, Eric
Cunningham, Tony (Workington)	Ingram, Rt Hon Adam
Curtis-Thomas, Mrs Claire	Jackson, Helen (Hillsborough)
Davey, Valerie (Bristol W)	Jenkins, Brian
David, Wayne	Johnson, Alan (Hull W & Hessle)
Davidson, Ian	Jones, Jon Owen (Cardiff C)
Davies, Rt Hon Denzil (Llanelli)	Jones, Kevan (N Durham)
Davis, Rt Hon Terry (B'ham Hodge H)	Jones, Lynne (Selly Oak)
	Jones, Martyn (Clwyd S)
Dawson, Hilton	Joyce, Eric
Dean, Mrs Janet	Kaufman, Rt Hon Gerald

Keeble, Ms Sally	Plaskitt, James
Keen, Alan (Feltham & Heston)	Pollard, Kerry
Keen, Ann (Brentford & Isleworth)	Pond, Chris
Kemp, Fraser	Pope, Greg
Khabra, Piara S	Pound, Stephen
Kidney, David	Prentice, Gordon (Pendle)
King, Andy (Rugby & Kenilworth)	Primarolo, Dawn
Knight, Jim (S Dorset)	Prosser, Gwyn
Kumar, Dr Ashok	Purchase, Ken
Ladyman, Dr Stephen	Purnell, James
Lammy, David	Quin, Rt Hon Joyce
Lawrence, Mrs Jackie	Rammell, Bill
Laxton, Bob	Rapson, Syd
Lazarowicz, Mark	Raynsford, Rt Hon Nick
Leslie, Christopher	Reed, Andy (Loughborough)
Levitt, Tom	Robertson, John (Glasgow Anniesland)
Lewis, Ivan (Bury S)
Liddell, Rt Hon Mrs Helen	Roche, Mrs Barbara
Linton, Martin	Rooney, Terry
Lloyd, Tony	Ross, Ernie
Love, Andrew	Roy, Frank
Lucas, Ian	Ruane, Chris
Luke, Iain	Ruddock, Joan
McAvoy, Thomas	Russell, Ms Christine (Chester)
McCabe, Stephen	Salter, Martin
McCafferty, Chris	Sarwar, Mohammad
McCartney, Rt Hon Ian	Savidge, Malcolm
McDonagh, Siobhain	Sawford, Phil
MacDonald, Calum	Sedgemore, Brian
McFall, John	Sheridan, Jim
McGuire, Mrs Anne	Simon, Siôn
McIsaac, Shona	Simpson, Alan (Nottingham S)
McKechin, Ann	Skinner, Dennis
McKenna, Rosemary	Smith, Angela (Basildon)
Mackinlay, Andrew	Smith, Geraldine (Morecambe)
McNamara, Kevin	Smith, Jacqui (Redditch)
MacShane, Denis	Smith, Llew (Blaenau Gwent)
Mactaggart, Fiona	Soley, Clive
McWilliam, John	Southworth, Helen
Mallaber, Judy	Spellar, Rt Hon John
Mann, John	Squire, Rachel
Marris, Rob	Starkey, Dr Phyllis
Marsden, Gordon (Blackpool S)	Steinberg, Gerry
Marshall, David (Shettleston)	Stewart, David (Inverness E)
Marshall, Jim (Leicester S)	Stewart, Ian (Eccles)
Marshall-Andrews, Robert	Stoate, Dr Howard
Martlew, Eric	Strang, Rt Hon Dr Gavin
Meacher, Rt Hon Michael	Stringer, Graham
Meale, Alan	Stuart, Ms Gisela
Merron, Gillian	Sutcliffe, Gerry
Michael, Rt Hon Alun	Tami, Mark
Miller, Andrew	Taylor, Rt Hon Ann (Dewsbury)
Mitchell, Austin (Gt Grimsby)	Taylor, Ms Dari (Stockton S)
Moffatt, Laura	Taylor, David (NW Leics)
Mole, Chris	Thomas, Gareth (Clwyd W)
Moonie, Dr Lewis	Thomas, Gareth R (Harrow W)
Moran, Margaret	Timms, Stephen
Morgan, Julie	Tipping, Paddy
Morris, Rt Hon Estelle	Todd, Mark
Mullin, Chris	Touhig, Don
Munn, Ms Meg	Trickett, Jon
Murphy, Denis (Wansbeck)	Truswell, Paul
Murphy, Jim (Eastwood)	Turner, Dr Desmond (Kemptown)
Murphy, Rt Hon Paul (Torfaen)	Turner, Neil (Wigan)
Naysmith, Dr Doug	Twigg, Derek (Halton)
Norris, Dan	Tynan, Bill
O'Brien, Bill (Normanton)	Vaz, Keith
O'Hara, Edward	Vis, Dr Rudi
Organ, Diana	Walley, Ms Joan
Osborne, Sandra (Ayr)	Ward, Ms Claire
Owen, Albert	Wareing, Robert N
Palmer, Dr Nick	Watson, Tom
Pearson, Ian	Watts, David
Picking, Anne	White, Brian
Pickthall, Colin	Whitehead, Dr Alan
Pike, Peter	Wicks, Malcolm

Williams, Mrs Betty (Conwy)	Wray, James
Winnick, David	Wright, David (Telford)
Winterton, Ms Rosie (Doncaster C)	Wright, Tony (Cannock)
Wood, Mike	Wyatt, Derek
Woodward, Shaun	Tellers for the Ayes:
Woolas, Phil	Mr. Tony McNulty and
Worthington, Tony	Mr. John Heppell.

NOES
Allan, Richard	Kirkwood, Archy
Baker, Norman	Lamb, Norman
Barrett, John	Laws, David
Beggs, Roy	Llwyd, Elfyn
Beith, Rt Hon A J	Marsden, Paul (Shrewsbury)
Brake, Tom	Moore, Michael
Bruce, Malcolm	Oaten, Mark
Burnett, John	Öpik, Lembit
Burstow, Paul	Pugh, Dr John
Cable, Dr Vincent	Reid, Alan (Argyll & Bute)
Calton, Mrs Patsy	Rendel, David
Campbell, Gregory (E Lond'y)	Robertson, Angus (Moray)
Campbell, Rt Hon Menzies (NE Fife)	Robinson, Mrs Iris (Strangford)
	Robinson, Peter (Belfast E)
Carmichael, Alistair	Russell, Bob (Colchester)
Chidgey, David	Sanders, Adrian
Cotter, Brian	Smith, Sir Robert (W Ab'd'ns)
	Smyth, Rev Martin (Belfast S)
Davey, Edward (Kingston)	Stunell, Andrew
Dodds, Nigel	Taylor, Matthew (Truro)
Doughty, Sue	Taylor, Dr Richard (Wyne F)
Ewing, Annabelle	Thomas, Simon (Ceredigion)
Foster, Don (Bath)	Tonge, Dr Jenny
George, Andrew (St Ives)	Tyler, Paul
Gidley, Sandra	Viggers, Peter
Green, Matthew (Ludlow)	Webb, Steve
Hancock, Mike	Williams, Hywel (Caernarfon)
Harris, Dr Evan (Oxford W)	Willis, Phil
Harvey, Nick	Younger-Ross, Richard
Heath, David
Holmes, Paul	Tellers for the Noes:
Hughes, Simon (Southwark N)	John Thurso and
Keetch, Paul	Mrs. Annette L. Brooke.

Question accordingly agreed to.

MR. SPEAKER forthwith declared the main Question, as amended, to be agreed to.

Resolved,

That this House welcomes the Government's strategy for modernising social care services through unprecedented real terms increases in resources, which enables and promotes better joint working between the NHS, social services, and the independent care sectors, develops a national framework for standards and quality and ensures a greater emphasis on users and patients in the design and delivery of services; notes that this has led to more independence for older people, fairer funding of long term care, reduced levels of delayed discharge and greater choice for users; and condemns the Liberal Democrats for their obsession with producer interests over those of users and patients and their failure to recognise that investment must be matched by reform.

rose—

Order. It is the convention of the House that the official Opposition occupy the Benches above the Opposition Gangway. Liberal Democrat Members are not Members of the official Opposition. As no Members of the official Opposition are in the Chamber at present, it does not matter that Liberal Democrat Members are seated on the Benches that are normally occupied by the official Opposition, but tomorrow Liberal Democrat Members will be in their usual place. They have only a short loan of the Benches in question.

Sittings In Westminster Hall

Ordered,

That, following the Order of 20th November 2000, Mr. Nicholas Winterton, Mr. John Me William, Mr. Frank Cook and Mr. Edward O'Hara be appointed to act as additional Deputy Speakers at sittings in Westminster Hall during this Session.—[Jim Fitzpatrick.]

On a point of order, Mr. Speaker. Following the observations that you made a few moments ago, are we to take it that if the official Opposition do not turn up tomorrow their Benches may be occupied by others?

In this place, we take one day at a time.

Manufacturing (Denton)

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

10.26 pm

I am grateful to have the opportunity to debate manufacturing industry in Denton, but I am sad that I have to report the tragic state of that industry in my constituency.

In the past four months, in and around Denton, a substantial number of jobs have been lost. Just across the border, in the constituency of my hon. Friend the Member for Ashton-under-Lyne (Mr. Heyes), we have lost Celestica—the former ICL company has completely disappeared from the Greater Manchester area. Strachan and Henshaw has closed. A large number of my constituents work at Woodford and Chariton, where there have also been substantial redundancies. Other engineering firms in my constituency face short-time working.

The real blow for the people of Denton—I feel it too—is the decision by Oldham Batteries to close its operation at Crown Point. The company has been in Denton for more than 100 years and it employed more than 1,000 people not so long ago. It is a sad blow that the firm—the largest manufacturing firm in Denton by far—is about to close.

There is a sorry tale of lack of interest from a succession of the people who owned the company. As long as it was a separate enterprise, there was a willingness to invest, but as the company gradually moved—first into the Mirlees Blackstone group, then to the Hawker group and, more recently, to Invensys—there has been a lack of concern for the people of Denton.

It is especially sad that, recently, Invensys has been sending a managing director to Denton for only one day a week to run the plant. How can anyone have a commitment to a local community when they visit it only once a week? That makes it extremely difficult for shop stewards and other people to lobby and argue for more investment in the Denton plant.

We can see in Denton a microcosm of the problems facing the whole UK. We are allowing manufacturing industry in this country to get into a state of terminal decline. Who is to blame? There has been a succession of people in Whitehall—civil servants as well as Ministers from both parties—whose hearts were not in trying to protect and defend manufacturing industry in this country.

I want to examine some of the factors that are crucial for manufacturing industry. The first is the rate of exchange between the pound and the euro. That has worked against manufacturing industry. If we go into the euro system, we must find an exchange rate that is much more favourable to the industry.

It appears that it is much easier for companies to get rid of jobs in Britain than in many EU countries. I have repeatedly been told by shop stewards that employment laws in France and Germany offer workers far greater protection. Because of that, firms with trans-European interests are much less likely to consider reducing employment in those countries, but find Britain a soft touch.

Perhaps shop stewards always make that point, but Oldham Batteries' managing director, Mr. Rowson, said the same thing when he gave the management's point of view. It is high time the Government gave much better protection to people in British industry, and ensured that they were not the soft touch in Europe when it came to getting rid of staff.

We must also consider how the capitalist system works in this country. Shareholders seem to feel little or no concern about whether companies operate as manufacturers or whether the aim is simply to sell off land. When I look around Denton, I am sad to see the numerous examples of how manufacturing industry has been destroyed by companies that can make more money from selling sites than from maintaining manufacturing.

Such companies include Lancaster Carpets and Sainsbury. I am not quite as critical of the toilet seat company called Celmac, which is turning its site over to Morrison supermarkets. It is moving to another location in Tameside, so at least the jobs are being retained, but it is another example of a company that sees that it can make more money from turning a site over to retail than from continuing in manufacturing.

Oldham Batteries wants to sell its site for retail usage, but the company now complains that it might not be able to. That seems a sad reflection on the attitudes of companies and shareholders in this country. They are just as happy to make money from selling land as from providing jobs.

How far should the Government support industry? It is recognised, on the east side of Manchester, that there is a lack of jobs. However, instead of helping industry, the Government devote money to various regeneration packages. That money does not find its way through into encouraging innovation.

I argue that the Government should encourage innovation with regard to batteries. I accept that, since Oldham made the generating batteries for underground haulage in mines and for cap lamps, the industry was likely to contract. However, there has been great opportunity for innovation in the manufacture of electric batteries for cars, for small vehicles used in street cleaning, and so on. The Government should have encouraged innovation much more.

I shall not go on much longer, as my hon. Friend the Member for Ashton-under-Lyne wants to make a few comments. However, I hope that the Government will act quickly to ensure that companies in Britain cannot get rid of their labour force more quickly than firms elsewhere in Europe.

My second plea to the Government is that, if we are to protect manufacturing industry in this country, we must look at the exchange rate. We cannot consider joining the euro at the present rate.

At present, Oldham's work force is working with the local Tameside council to see whether a rescue package can be produced. One possibility is that the manufacture of miners' cap lamp batteries could continue as a small operation in Tameside. I plead with my hon. Friend the Under-Secretary for at least some help in that regard. It would be much appreciated.

A small number of manufacturers have an attitude different from the one that I have described. For example, the Hyde group that operates in Tameside does not have to worry about making a profit this year and satisfying shareholders in the short term. That is because of the way the shares are held in the company. The group has a record of investing in manufacturing industry in Tameside. The Government should work hard at finding ways to help the group with that, and they should recognise the large amount that it does to help the area.

I spoke to Tony Hodkinson, the managing director of Harvey, which is a part of the Hyde group that wants to make machine tools for the aircraft industry. During September and October it was on short time, but it has the necessary long-term commitment and is trying very hard to fight its way through what in manufacturing terms is a recession. I plead with the Minister to offer some hope to those companies. The Government should realise that some companies are trying to fight the system and keep manufacturing in place, and they should give them some recognition for doing so.

It would be easy for the Chancellor to provide much better allowances for the investment, but the message that I want to get across in this Adjournment debate is that manufacturing industry is in crisis across the country, of which Denton is a microcosm. We cannot go on just with service industries; we need to keep our manufacturing base.

When I was brought up in Greater Manchester, one of the best things that a youngster could do was get an engineering apprenticeship. Over the years, we have destroyed almost all the apprenticeship system because of the decline in manufacturing industry. We now have at least to tell the companies that are trying to do something about that that the Government want to help them, so I have some requests for the Minister. Please let us do something about changing the redundancy regulations in this country, so that we give workers some protection. Let us consider our exchange rate policy, so that it provides manufacturing with some protection. Let us ensure that some help is provided in the Budget to keep manufacturing industry going in this country.

10.36 pm

I congratulate my hon. Friend the Member for Denton and Reddish (Andrew Bennett) on securing tonight's debate on this most important matter, which is hardly less important to my constituents than to his. I am pleased to have the opportunity to make what I promise will be a very brief contribution.

My hon. Friend and I are, of course, next-door neighbours, with the larger parts of our constituencies sitting in the borough of Tameside. Many of my constituents travel to work in Denton, and I am sure that many of my hon. Friend's constituents travel to work in Ashton-under-Lyne. That travel-to-work pattern has been made easier in the past year, since the opening of the final section of the Manchester outer ring road. Junction 22 at Hollinwood and junction 23 at Ashton- under-Lyne serve my constituency, and junction 24 serves Denton in my hon. Friend's constituency.

Although that road's completion was 20 years behind schedule, we all had great hopes that improved access to the national road network would give a much-needed boost to efforts to attract industry and employment to our part of the world. In fact, the reverse has been the case. Despite the energetic and persuasive efforts of local partners—I single out for special mention our local authority in Tameside—there has been an exodus of relatively high-tech manufacturing jobs in the past six months. In some cases, those jobs were located just a few yards from the new motorway.

My hon. Friend has spoken of the problems in Denton, and I share his sadness about hundreds of job losses at British Aerospace in Chadderton and Woodford, where many of my constituents and his are employed, and at Siemens in Hollinwood. More than 800 electronics jobs have gone at Celestica—the remnants of the once mighty ICL, which bestrides the boundary between our constituencies. Many other jobs have gone or are currently under threat.

So how are we to explain what has been happening? One thing is certain: in none of those cases should blame be laid at the door of the workers or trade unions. Productivity levels can match those anywhere else in the United Kingdom or western Europe. Our industrial relations climate has been exemplary. Our labour costs, given the highly skilled nature of many of these jobs, are among the keenest. That, coupled with the skill, dedication and experience of many of our locally based managers, has often given us the competitive edge, until recently.

The global economic forces, structural shifts and exchange rate problems that we have witnessed being played out locally, which my hon. Friend has mentioned, are frankly beyond the ability of our constituents or local agencies to control. My hon. Friend has given his explanation for what has gone wrong and his prescription for action to hold the situation and to start to turn it round. I need not repeat that; I simply wholeheartedly endorse what he said. For the benefit of my constituents, as much as his, I join him in requesting that serious attention be given to what has been said in this debate. I know that I can count on the Minister to take on board our plea.

10.40 pm

I congratulate my hon. Friend the Member for Denton and Reddish (Andrew Bennett) on securing this debate on manufacturing in Denton and my hon. Friend the Member for Ashton-under-Lyne (Mr. Heyes) on his thoughtful contribution.

I wish to express my concern at the loss of the manufacturing facility of any leading company. Manufacturing matters, and it matters to the Government, to the economy, to the people who work in it and to all of us who enjoy its products. It accounts for about a fifth of our national income, with almost £150 billion of output each year. It employs about 4 million directly, and millions more depend on manufacturing for their livelihoods, including 2.5 million people in the service sector. A strong manufacturing sector is the backbone of our economy.

As the Minister responsible for small and medium-sized enterprises, I have visited manufacturers who were pioneers 200 years ago and who are now innovators at the cutting edge of competition. On Monday this week, I visited two leading manufacturers in Cornwall—Precision Audio Products and Allan and Heath—and both are major local employers and leaders not just in the UK but worldwide. They export all over the globe. Many of the components for those companies are foreign sourced so they do not advocate the devaluation that my hon. Friend the Member for Denton and Reddish has advocated. However, I recognise that the exchange rate impinges on companies in variable ways.

Manufacturing is led by some of the most innovative businesses that invest heavily in research and development. It drives innovation in the rest of the economy and creates jobs and prosperity. It is the crucible for productivity improvements across the whole economy, through advances in technology, new goods and processes; but most of all through a highly skilled and highly flexible and dedicated work force. In the last four years, we have helped 3,000 businesses, and supported £6 billion of investment and 135,000 jobs—most of them in manufacturing.

Manufacturing is proportionately even more important in some areas of the country, and Denton is one of them. In Tameside as a whole, around one third of the work force are employed in manufacturing, as against a national average of about 17 per cent.

I was very sorry to hear about the announcement made by Hawker Traction UK that the Oldham Batteries site in Denton is to close. No constituency has a more doughty fighter for manufacturing than that of my hon. Friend. Although such decisions are for the companies concerned to make, they are always extremely regrettable and the effects are devastating for staff and their families.

When redundancies are inevitable, we will not walk away. We will do everything that we can to help people to find new jobs and to get new skills. We cannot, sadly, make up for what my hon. Friend described as the lack of interest shown by successive managements. That is a damning indictment of those managements, but I fear that the Government find that the position is difficult to influence or to reverse.

The company has been in contact with the Small Business Service in connection with the present situation, and the service has provided advice for and assistance with the task of identifying alternative employment opportunities for Oldham Batteries staff. In the north-west, helping businesses is a key element of the North West Development Agency's regional strategy. A number of tools are available to the agency and other Government bodies to help them to assist businesses. In 2000–01, 81 offers of regional selective assistance to businesses in the north-west were accepted. That is the largest number of any English region. The total value of the assistance was close to £20 million, and went towards capital investment of almost £158 million. That had the effect of creating 3,267 jobs and safeguarding 2,056 more across the region. At the same time, 93 offers of enterprise grant funding were accepted in the 12 months to March 2001, with a total value of £3 million going towards capital investment of more than £26 million.

We are always seeking to improve the assistance that we give to companies, and we want to have the right toolkit to do that. Our rapid response units have a creditable record in finding new employment for people who are affected by major job losses. The rapid response unit helped to ensure that about 94 per cent. of the work force at Fujitsu in county Durham found new jobs within 12 months. At Siemens in north Tyneside, the Employment Service played a major role in helping about 90 per cent. of the work force to find new employment. Recently, the Government helped Kirpak Ltd., near Wigan, when its plant was threatened with closure. Plans to move production overseas threatened 169 jobs. Following Government assistance, the company invested £10 million and created an extra 116 jobs. The new plant will be officially opened on 1 February this year.

The rapid response service has shown that it can be effective in the constituency of my hon. Friend the Member for Denton and Reddish. The Canadian-owned company Celestica announced in September its intention to close its plant in Ashton-under-Lyne, with 570 job losses. By the end of the year, 412 employees had sought the assistance of the Employment Service job shop. Some 243 were referred to job opportunities and 71 were referred for training.

My hon. Friend touched on the comparative costs of making people redundant across Europe. He will know more than most that that is a difficult and complex assessment to make. It is not necessarily cheaper for companies to close down plants and make people redundant in the United Kingdom than it is elsewhere in Europe. The Organisation for Economic Co-operation and Development rates the UK eighth out of 15 for redundancy costs. Many firms here pay above the statutory minimum redundancy compensation.

Individual circumstances of employees in companies that are making redundancies can, of course, cause significant variations in the overall cost of each large-scale redundancy. By comparing Britain, France and Germany, economists at the Department of Trade and Industry found, on average, that while it is cheaper to make workers with only one or two years' service redundant in the UK than it is in France or Germany, if a worker has longer service, the cost of making them redundant in the UK is less than it is in Germany.

Does my hon. Friend accept that one of the problems is the amount of consultation, in particular the period of notice in which discussions have to take place? As I understand it, the consultation period is substantially longer in both France and Germany.

I am happy to refer my hon. Friend's concerns to Ministers in the Department for Work and Pensions. However, I chaired a meeting with my hon. Friend the Member for Alyn and Deeside (Mark Tami), a trade union, and key representatives of a plant that was threatened with closure. I put it to the management of that company, which was based in the United States, that the local work force believed that it was keeping the German plant open at the expense of the British plant because it was easier to make people redundant in the UK. The management told me that that was not the case and, separately, that the German plant was being closed as well. There is not a uniform position on that, but obviously I will ensure that the DTI considers my hon. Friend's thoughtful points carefully.

It is of course important that we constantly review the Department's business support activities. My right hon. Friend the Secretary of State for Trade and Industry has announced several important changes to ensure that, in the regions, Government agencies work together to improve the delivery of support to manufacturers and other businesses.

We can no longer compete on labour costs and raw materials alone. With globalisation, low value added goods can be produced more cheaply elsewhere. The challenge for the UK is to shift focus from competing on cost alone to competing on high skills and high value added products and processes based on quality, innovation and know-how—the very qualities demonstrated in many of the manufacturing plants in the constituencies of my two hon. Friends. Like many British manufacturers, companies in their constituencies are responding positively to the new challenges. A good example in the north-west is that of Bodycote International in Macclesfield in Cheshire. Originally a garment manufacturer, it is now a world leader in heat treatment technology.

The Government are committed to providing high-quality help to people faced with redundancy and to companies facing change. To enable them to overcome the difficulties, we have put in place a combination of mechanisms to encourage inward investment and technological investment in UK companies. At the same time, if companies are not able to keep up or catch up with global competitors, we want to enable the work force to be redeployed to more successful companies, and to retrain if necessary.

Will my hon. Friend consider carefully the possibility of helping people, especially the stewards, who want to keep the manufacture of cap lamp batteries in Denton? Are the Government able to give some help to get their efforts off the ground?

We are already in touch with the Small Business Service and the Business Links organisation in my hon. Friend's constituency. I am happy to give him an assurance that we will facilitate a meeting with our key business advisers and Employment Service representatives to ensure that every avenue is explored and that all thoughtful and practical suggestions made by my hon. Friend's trade unionist constituents are taken fully into account.

We recognise that the Government have a clear role in helping companies to face the challenges of globalisation, technological change, and the various stages of the business cycle. We are investing £15 million in a new manufacturing advisory service to spread best practice; that will include a centre for manufacturing excellence in every region. The Government are committed to working in partnership with manufacturing and other business sectors, and with employees, to maintain and develop a strong British economy.

We will promote closer links between education and industry, with a view to improving the skills base on offer in all the regions of this country. The Government's policies for delivering stable and steady growth are working, and we shall continue to pursue them as the best means of supporting manufacturing and British industry generally in a global and competitive economy. British manufacturing and business will change, as they must, but we will ensure that they match the best in the world.

Question put and agreed to.

Adjourned accordingly at six minutes to Eleven o'clock.

Correction

Official Report, 15 January 2002: in column 265, Division No. 133, in the Noes, insert Mr. Gerald Howarth (Aldershot) and leave out Mr. George Howarth (Knowsley, North and Sefton, East)

Volume 378: debated on Wednesday 16 January 2002

House Of Commons

Prayers

Oral Answers To Questions

Northern Ireland

Devolution

Organised Crime

Decommissioning

Prime Minister

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Waste Refrigeration Equipment

Engagements

Travel Concessions (Young Persons)

Travel Concessions (Young Persons)

Opposition Day

Railways

Care System

Sittings In Westminster Hall

Manufacturing (Denton)

Correction