With permission, Mr. Speaker, I would like to make a statement on the planning system. This year marks the 60th anniversary of the Town and Country Planning Act 1947, one of the great civilising reforms of Attlee’s Government. The Act laid the framework for a planning system that has helped create thriving towns, protect our most beautiful countryside, and ensure green spaces around our cities. Its adaptability has been key to years of success. Further reform will help ensure its success for the future, too.

But today we also face significant and growing challenges that could not have been imagined 60 years ago, from climate change, to globalisation, to energy security in an uncertain world. If we are to meet those challenges successfully, planning must be part of the solution. In its current form, it is simply not up to the task. Both Kate Barker, in her review of land use planning, and Sir Rod Eddington, in his review of transport infrastructure, have highlighted the shortcomings of the planning system.

First, an inaccessible and sometimes baffling system makes it hard for people to have their say on issues that can have a big impact on their quality of life. Too often it favours the well-resourced over the less well-off. Secondly, decision making can be painfully slow, causing costs and prolonged uncertainty that are in no one’s interests—not in those of individuals, communities or developers. Thirdly, where good and necessary development is held up, it can mean society missing out on the reliable transport, secure energy, clean water or public amenities that we all need. The costs of not acting are clear, and will only grow more acute in future: energy shortages, mounting congestion, loss of jobs and a worse quality of life. Indeed, an effective planning system is vital for delivering Government policy across a wide range of areas.

The White Paper that I am publishing today sets out a series of proposals to meet the challenges of the future and continue to reform the town and country planning system. The White Paper represents the result of joint working across Government, in particular with my right hon. Friends the Secretaries of State for Trade and Industry, for Transport and for Environment, Food and Rural Affairs. Let me first address the proposals on how we take decisions about major infrastructure, such as transport, environmental, waste or energy projects—everything from roads, to reservoirs, power plants and wind farms.

The system for taking those decisions has grown up piecemeal over decades with complex, unwieldy and overlapping rules. Some developments have to get approval under a number of different pieces of legislation, and make numerous separate applications. We need a simpler system to respond to the challenges that we face. The White Paper will ensure that decisions are taken in a way that is transparent and timely, and achieves the right balance of interests.

There are three key elements to our proposed new procedures for national infrastructure projects. First, Ministers will issue national policy statements about the infrastructure that the country needs for the next 10 to 25 years. Those statements will be subject to parliamentary scrutiny and intense public debate, making sure that people have early input into the formulation of the policy, rather than rehearsing the same arguments over and over again in different local inquiries.

Secondly, we are replacing the numerous and sometimes overlapping consent regimes for major infrastructure projects with a single system. That will provide a far clearer and more accessible application process than at present.

Thirdly, we propose to create a new independent infrastructure planning commission. That will bring together experts from key sectors, including planners, lawyers, environmentalists and others. Guided by the national policy statements, the commission will oversee the planning inquiry process on specific major developments and take the final decisions on whether they should go ahead. It will listen closely to local concerns, and where the commission approves an application, it will be able to specify measures to mitigate the impact on a local area. It will be accountable to Ministers and Parliament for its performance. We believe that it will bring greater objectivity, transparency and accountability to the decision-making process.

Some interest groups promote a false choice between speed and public engagement. Our reforms will achieve both, providing opportunities for better public engagement at every step in the process. There will be public engagement in the formulation of the national policy statements, at the scheme development stage and during the inquiry process. We are backing that up with a new legal duty for developers to consult the public. Consultation must not be a box-ticking process, but a genuine opportunity for local people to have their say in shaping the places where they live. In addition, we are increasing resources for bodies such as Planning Aid, which will help more communities and individuals get access to free professional planning advice.

As well as new procedures for major infrastructure projects, the White Paper outlines measures to improve the town and country planning system. Kate Barker’s report recognised the progress that had been made in recent years to speed up the system and make it more effective, but it also stressed the need to reform further for greater flexibility, responsiveness and efficiency.

Our White Paper responds to those recommendations. Our aim is to create a level playing field that better integrates economic, social and environmental objectives. We will do that by building on the success of the plan-led system with sustainability at its heart. New planning policy statements on economic development and climate change will clarify the national policy on those vital issues. We will also streamline our planning policy documents to devolve where appropriate to local decision makers.

We will continue to promote prosperous and thriving town centres. Our town centre first policy has been a real success, with more than two fifths of retail development now in town centres, compared to just a quarter in 1994. It will remain in place, but there is scope for it to be more effective. The current needs test can sometimes be a blunt instrument to gauge the impact of development on town centres. In future, we will require better assessment of how new developments will affect town centres, including the impact on high streets and local shops. Development outside the town centre should not go ahead where it will impact detrimentally on the town centre. We are also reaffirming our commitment to the fundamentals of green-belt policy. It has served us well for 60 years and will continue to do so in the future.

It is vital that planning plays its part in tackling climate change. We will make it easier for householders to reduce their fuel bills and carbon footprint by installing small-scale renewable technologies such as solar panels. In addition, building on the progress made on new homes, my hon. Friend the Minister for Housing and Planning will work with industry to deliver a significant reduction in carbon emissions from new offices and shops.

We are strengthening the role of local government in planning, too. We want to enable local authorities to use planning effectively as a tool to achieve their vision for their area. We will continue to work with partners, including the Local Government Association and the planning profession, to improve performance. With this growing local expertise we aim to devolve further decision making to local communities and to reduce the number of town and country planning cases called in by the Secretary of State.

Our reforms will make town and country planning applications more efficient. We will make it easier for people to make minor improvements to their homes, such as building conservatories or small extensions, while continuing to protect the interests of neighbours and local communities. That will enable councils to focus resources on the genuinely difficult cases. We will also both simplify planning applications and speed up the appeals system.

Our reforms will be good for citizens, who will have greater opportunities to have their say at every stage in the process and the chance to make minor improvements to their homes more easily. Our reforms will be good for communities, by supporting sustainable and vibrant town centres and helping to create safe and healthy places to live.

Our reforms will be good for business, giving greater certainty about the national policy framework to encourage investment and faster decisions on developments. Our reforms will be good for the country, with better access to reliable transport, secure energy, clean water supplies and better local amenities. Finally, our reforms will put climate change and sustainable development where they belong: right at the heart of the planning system.

Our proposals build on Attlee’s legacy and give us a planning system fit for the 21st century. I commend the White Paper to the House.

First, I thank the Secretary of State for letting me have a copy of the White Paper at the same time as the statement.

It is just three years since the Government’s last attempt at planning reform and some of the guidance reached councils only last month. Does the Secretary of State accept that the Government are having to re-do the exercise because the Act designed to speed up the process and engage local people has only made planning more sclerotic and left communities feeling more disempowered?

How does the Secretary of State explain that, after 10 years in power and with all the rhetoric about increasing home ownership, the number of home owners is declining for the first time in recorded history and the number of houses being built fell again last year?

Of course we all want to see a planning system that is simpler, swifter and seen to be fair. So why not start by abolishing the Deputy Prime Minister’s regional planning bodies, which are unelected, unaccountable and unwanted? Does she not realise that the centralised planning, micromanaged targets and plethora of contradictory edicts that have snarled up the planning system have emanated from the Government and reflect their core philosophy of top-down control, with the bureaucrats in Whitehall knowing best?

It was the Chancellor who hired Kate Barker to review the planning process and he has bought her case for a centralised and undemocratic planning quango. How does that square with his promise last week to

“devolve power to localities and listen to the people”?

The promised engagement and consultation are not the same as decision making, so why are local people being offered less say under the Prime Minister-elect than under his predecessor?

We all accept that there are some projects of strategic national importance that have been too delayed in the past, but is that a reason for creating an unelected and unaccountable quango as a means of passing the ministerial buck? Conservatives will vigorously oppose this erosion of local democracy.

We welcome the news that the Government have rejected Kate Barker’s recommendation that regional planning bodies should review the green belt, but is that rejection meaningful when the present regional spatial strategies propose housing targets that compel the use of green belt to meet the housing quota?

I am sure that Members on both sides will be concerned about plans to relax restrictions on out-of-town retail development. How can the Government justify abolishing the needs test for out-of-town shopping when so many of Britain’s towns have been turned into ghost towns by the dominance of retail parks on their peripheries? My right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer) created a life support machine for high streets with planning policy guidance note 6—PPG6—that the Government are about to switch off.

We welcome more relaxed planning on home improvements, particularly the green energy measures that would have made the life of my right hon. Friend the Member for Witney (Mr. Cameron) a lot easier. Does the Secretary of State accept, however, that the huge increase in such applications arises when people have to extend their homes because they cannot afford to move? Should not the Government apologise for presiding over a house price crisis stoked by increases in stamp duty and a doubling of council tax?

On the subject of tax, I shall turn my attention to the planning gain supplement. We support the campaign to put i before e—infrastructure before expansion—but how can the Minister be so sure that infrastructure funding will find its way out of the Treasury and back to the local community? We accept that more homes need to be built, but why not seize the opportunity and regenerate the suburbs around Britain’s cities and use vehicles such as community land trusts to get local homes for local people in Britain’s towns and villages?

I am disappointed that there is no recognition that garden-grabbing is an ongoing problem. The White Paper praises the increased use of brownfield sites, but what percentage of them are, in fact, gardens? Is it any wonder that appeals are up, when such development is so unpopular?

The Government have presided over a housing crisis of monumental proportions. Despite all their schemes, targets and meddling, key workers cannot afford to live near their work; the young cannot get a foot on the housing ladder; homelessness is higher than it was under the last Conservative Government; and the rate of social house building is down.

Only last week, the Chancellor pledged to stop politics being a spectator sport and to provide a voice for communities, but does not this White Paper show that the reality falls far short of the rhetoric and that when it comes to planning this Government choose centralised bureaucracy over local democracy every time?

I was going to say that I was disappointed by the hon. Lady’s response, but frankly I am staggered. After five minutes listening to her, it is still not clear whether she favours the proposals. This is a serious set of proposals to meet some of the challenges that we face as a country, particularly on major infrastructure. Is she in favour, or is she against? Whenever the Government put forward the substance of a policy, the Opposition duck it. Whether it is planning or increasing housing, which the hon. Lady obviously does not support in any single part of the country, when faced by long-term, difficult challenges, she has nothing to say.

The hon. Lady has said that the process will be somehow inaccessible to the public. I think that she misunderstands how the current planning system works for major infrastructure projects. The process for terminal 5 took seven years to complete, and there were 37 different applications and seven different pieces of legislation for different Ministers to consider throughout the process. At the end of the process, Hillingdon borough council had to withdraw from fighting the appeal through lack of funding and resources. That is not a system in which local people had the opportunity to have a real say.

We are putting forward policies where there will be an opportunity for early input from local people, environmentalists and different stakeholder groups on the national policy statement. There will be an opportunity for engagement before the development application is made when the scheme is being worked up, and there will be an opportunity for the public to have their say during the local inquiry process, too. The process will deliver greater speed and certainty, so people will have the opportunity to have their say. We will back that up with more planning resources to help hard-to-reach communities get involved.

The hon. Lady has argued that we are somehow centralising those measures, but throughout the White Paper we make it clear that we are taking decisions at the appropriate level. If a decision is made on a national infrastructure project, it is right that we have a national policy debate. When local decisions are made, it is right that we devolve more of them to local communities. We have said that some decisions currently taken by Ministers will, we hope, be taken by local authorities. That is one reason why the Local Government Association welcomed the proposals today—the Tory-led Local Government Association, dare I say.

I welcome the hon. Lady’s support for making microgeneration easier. She also said that the issue of back garden development should be on the table. However, that does not add up to a serious policy proposal from the Opposition.

Let us consider the hon. Lady’s town centre policy proposals. She says that we should not remove the needs test. Does she not accept that the needs test can have a perverse effect on town centres? We need a policy that promotes the vitality and sustainability of our town centres. [Interruption.] The hon. Member for Rutland and Melton (Alan Duncan) asks from a sedentary position how we are going to do it. I shall give an example. If a developer put in an application for an edge-of-town-centre development that would drain that town centre’s vitality, it could be refused on the basis of a needs test saying that there was already existing capacity in relation to another developer who had an out-of-town site. That does not help town centres. In future, we want a stronger impact test that considers the impact of any development on the town centre.

I am incredibly disappointed by the hon. Lady, who has failed to meet the challenges for the future. She has failed even to say whether she welcomes the White Paper that has been put before the House. This package will be good for citizens and will deliver speed and certainty for business. I commend it to the House.

The White Paper proposes an increased role for parliamentary scrutiny but also suggests that public representations would be taken prior to such scrutiny. Will the Secretary of State clarify whether that means that there would not be any direct interaction between parliamentary scrutiny and further public representations?

My hon. Friend makes an important point. The public have a right to be fully engaged in the formulation of national policy statements, and early on in the process. When a national policy statement is drawn up, it is right that people should have an opportunity to get involved and to make clear their points of view, which will be reflected in its formulation. The national policy statement will then be scrutinised and debated in this House. That is a sensible way of drawing up national policy statements. We should determine need at the right time in the process rather than at various moments during local planning inquiries, where sometimes arguments are rehearsed repeatedly, leading to a waste of time and money.

Liberal Democrats welcome the Secretary of State’s statement and the publication of the White Paper, although not necessarily everything in it. I look forward to reading it first-hand rather than having to rely on the newspapers.

At the heart of any national planning policy statement must be a balance between environmental sustainability and economic sustainability. Without that, we will not have the social sustainability that is the foundation of healthy communities. Can the Secretary of State explain why she is tilting things away from environmental sustainability in favour of big business and big projects? The key to all this will be how the new national policy framework is implemented, what the Government propose, and what opportunities the House has to take sensible, binding decisions on that national policy framework. How will that aspect of her proposals be taken forward? If that goes wrong, anything that the independent commission does will be stuck in a cul de sac.

Will the independent commission have the power to refuse a project, or will it merely be a rubber stamp or a paper tiger? Unless it has the capacity to refuse a project despite what the Government or the House might have said about national objectives, its credibility and that of the whole system will quickly crumble. At the moment, we have the gravest doubts about it.

I welcome what the Secretary of State said about town centre development, but we are not sure what the mechanics of delivering it will be. The devil will be in the detail. What discussions has the right hon. Lady had with major retailers? How did they respond to the plan that she has brought to the House today?

We strongly welcome a new duty on developers to consult local communities. I would like to hear that mobile phone companies are included in that. We also welcome, in the Secretary of State’s words, “a level playing field”, although her next phrase—that she intended to build on it—was not so encouraging. Will the right to speak and vote on planning applications be restored to local councillors? If there is to be more community engagement, which will involve the hard-to-reach groups, surely it is wrong for those groups’ elected representatives to be unable to participate in the process that the Secretary of State wants. I am sure that she knows that we have tabled an appropriate amendment, which will be discussed tomorrow, to the Local Government Bill. Will she support it?

We welcome the opportunity that the White Paper presents to hold a national debate on such important issues. We look forward with deep interest to the detail that may come in the planning Bill in November.

I welcome the hon. Gentleman’s more balanced approach to the proposals. His first point was about the balance in the proposals between the environmental, economic and social considerations. There are two parts to the proposals: the major infrastructure projects and the town and country planning system. In the latter, we have deliberately not taken an approach that favours one aspect over another. Indeed, sustainability in the plan-led process is at the heart of local planning. I hope that he welcomes that. However, we want people to think positively about planning, which is why we will revise the principles of the planning system and introduce a new planning policy statement on economic development.

I believe that I have already dealt with the point about major infrastructure projects in reply to the hon. Member for Meriden (Mrs. Spelman). The system will produce greater timeliness, greater transparency and the ability for local people to have their say in the process. When the hon. Member for Hazel Grove (Andrew Stunell) has time to examine the detail, he will realise that, for the first time, there will be a statutory duty to consult local people. To answer his specific question, local people will have the opportunity to have their say in hearings during a planning inquiry as the system moves from favouring those who can afford to pay lawyers’ fees to enabling those who are hard to reach to influence the outcome of the inquiry process.

The independent planning commission will have the power to turn down an application even if it is consistent with the national policy statement if, for example, a proposal’s local disbenefit or cost to a community is greater than its perceived national benefit.

The hon. Gentleman said that the devil was in the detail on town centre development. I grant him that: it is a complex subject. We have been discussing those issues with stakeholders and so on. They have not had an opportunity to read our proposals yet and I am sure that they are listening intently to the debate. However, we will introduce a stronger impact test, which we will formulate and publish so that people have the opportunity to have an input into its development, thus enabling us to promote our town centres and continue our town centre first policy. The sequential test will remain in place.

The package of proposals is sensible and will work for the benefit of citizens and communities as well as businesses, environmentalists and other groups.

The Secretary of State knows that Heathrow lies in my constituency and that 10,000 of my constituents could lose their homes as a result of the proposals for the third runway and a sixth terminal. There are genuine concerns that, in the proposals that she set out today, the local community voice will be overridden and the democratic processes of Parliament will be undermined. Will she give more details about the support that will be provided to local communities, the resources that will be available and when they will become available, because the planning application process for Heathrow could be imminent?

My hon. Friend is right that it is important for his constituents to have an appropriate and early input into discussions on issues such as a new runway. As well as building up the planning capacity of local councils, we intend to double the amount of money that we spend on Planning Aid. It provides free legal and professional advice on planning to communities, particularly hard-to-reach communities. We will also provide guidance on how local authorities should consult those communities to ensure that they are adequately involved in the process. The key factor is that an incredibly long process, such as the one on the new terminal, does not benefit anyone. It certainly does not enable local people who are hard to reach to have a say. The new system should be more transparent. Together with the other measures that we are proposing, it will make it easier for local people to have a say.

While I doubt that the Secretary of State’s proposals will be greeted with unbridled enthusiasm by my former colleagues at the planning Bar, I have long thought that some reform of the arrangements for dealing with national projects of major significance would be desirable. Does the Secretary of State acknowledge that all national projects have local aspects and local impact? In reply to a question from the hon. Member for Hazel Grove (Andrew Stunell), she referred to oral hearings. Will she give an assurance that the planning commission that she proposes to set up will sit locally and in public to hear representations on those local implications of the national projects?

I welcome the right hon. and learned Gentleman’s statesmanlike tone. It is absolutely right that he realises that, although we need to deal with the major infrastructural challenges of the future, we also need to do so in a way that recognises that local communities must have an appropriate influence on the national policy statement. Clearly, public investment is different from private sector investment, but where the plans are spatially specific—perhaps where the public sector outlines major road spending—it would be right for the local communities to be able to influence the drawing up of the national policy statement in the first place. It is right, too, for the infrastructure planning commission to sit locally and hear local input directly in order to bring that into its deliberations.

I acknowledge that certain projects such as terminal 5 and Thameslink 2000 can get mired in process, but does my right hon. Friend accept that some schemes thought necessary and desirable by the great and the good can be the cause of much local concern? I am thinking particularly of the east London river crossing in my constituency and the local community uniting against the building of a six-lane motorway through Oxleas woods—a unique site of special scientific interest that would have been destroyed. Sometimes these good and necessary schemes are not in the public interest and certainly not in accordance with any environmental impact studies. Will my right hon. Friend give an assurance that, first, local communities will still be able to stop the great and the good imposing such schemes on them and, secondly, that in what she proposes today the environmental impact will be front and centre of any consideration?

I can give my hon. Friend a categorical assurance on both counts. If the local disbenefits outweigh the national benefits, it is absolutely right that local people should be able to have an influence and that the IPC should be able to turn down any such proposals. It is right too that the environment is taken into account in the drawing up of the national policy statement. It is a key consideration that an environmental appraisal be part of the national policy statement; it would look not just at the overall impact of the statement, but at specific local impacts.

Does the Secretary of State accept that the planning system exists to mediate between different views of what is in the individual, the local, the community and, indeed, the national interest, and that therefore we face competing public goods? I think, for example, of the landscape of the Yorkshire dales as against renewable energy, or the roofline of a Georgian terrace in an urban conservation area as against wind turbines or solar panels. Will she ensure that the processes of consultation are such that in our anxiety to make the environment more sustainable we do not threaten it?

I completely accept the right hon. Gentleman’s point. That is why a full national debate and parliamentary scrutiny of national policy statements is essential. I hope that he acknowledges that early input into the process from environmental groups and others with an interest will make it more likely that we get the policy right, which would have better results for the environment as well as for the economy and society. There is a potential win-win situation, with greater clarity and transparency as well as greater opportunity for influence.

As a former chair of a local authority planning committee, I welcome today’s White Paper. The present system is confusing and can be time-consuming. As the representative of an historic city with more than 900 listed buildings, however, I must ask the Secretary of State for reassurance that nothing in the White Paper will undermine the protection and safeguards that we give to important listed buildings.

I can give my hon. Friend that assurance. She is presumably aware of the recently published heritage White Paper that proposed a new, streamlined regime for listed buildings. There is nothing in today’s White Paper that dilutes those necessary safeguards.

I am sure that there are things in the White Paper that, on close study, will prove useful, but does the right hon. Lady accept that her Government have been telling us for a long time now that planning applications for large numbers of houses, particularly in the south-east of England, where we acknowledge they are needed in some places, will be matched by infrastructure to support that level of building, but so far there is absolutely no sign of that happening anywhere? For example, in the major proposal for East Grinstead, there is no infrastructure at all planned by the Government. Will the right hon. Lady give me some assurance that the Government will reconsider those plans in the light of what she has said today?

It would be useful if, before I answer that question, the hon. Member for Meriden were to acknowledge the country’s need for the 200,000 extra homes identified in the Barker review. The hon. Gentleman is right to say that extra homes need to be accompanied by extra infrastructure spending, and the Government have a proposal to meet that extra spending: the planning gain supplement. I have yet to hear anything from the hon. Lady on the Conservative Front Bench about where that money would come from.

Although I support the general approach of this policy, the devil will clearly be in the detail. Will the Secretary of State tell us who will be able to make a referral to the independent planning commission? Will local residents and citizens, particularly those with environmental concerns, be able to make a referral? How will the commission sit with the planning inspectorate?

When the independent planning commission holds a local inquiry on a local planning application, there will of course be opportunities for local people to have a direct say, in oral hearings or through written representations. They will be able to approach the planning commission. It will also be possible for Members of Parliament to get involved and to have a say. The list of statutory consultees is set out in the White Paper. The planning inspectorate will continue to have a role to play in the town and country planning system, which is designed to deal not with the major infrastructure projects that we have been discussing but with more local planning matters.

The right hon. Lady has made many references to local people having their say, but she has been somewhat silent on local decision making. Who, for example, would uphold a unanimous decision that had been reached democratically in accordance with a borough plan, a local plan or a structure plan, if a Minister were to come in and allow 120 houses to be built on a natural flood plain, as has happened in Colchester? Where is the local accountability there?

I am sure that the hon. Gentleman will understand that I cannot comment on a specific planning application. The planning White Paper sets out our proposals for reducing the number of call-ins that are made either by officials in Government offices on behalf of Ministers or directly by Ministers themselves. It also contains proposals for local members to hear appeals on local planning decisions more frequently.

I welcome the Secretary of State’s emphasis on local decision making and a level playing field. It is clear, however, that she has never sat on a planning committee or been involved in the planning process. In planning law, there is a presumption to agree a planning application. Therefore, however many platitudes we come out with about level playing fields or giving more money to ineffective organisations such as Planning Aid, we will end up with a lot of frustrated and unhappy people, whose hopes have been built up but who will not be able to carry out their plans. I do not actually welcome the reduction in the number of call-ins, because there are occasions when the public need protection from politically corrupt local planning committees.

My hon. Friend has already spoken to my hon. Friend the Minister for Housing and Planning about some of those issues. The key is to have a local vision of what is right for a local area, agreed with local people and implemented through the plan-making process. If an application is made in line with the plan, clearly, it would normally be approved. What is at issue is an application that is submitted outside the limits of a plan, in which case we want a system in which the environmental considerations are given priority alongside the social ones, so that a clear view is taken across all.

What impact will the Secretary of State’s statement have on national parks? As for small extensions, how would she describe a small extension to Chatsworth house?

Very funny! On national parks, I have made it clear that our policies do not change our fundamental approach either towards green belt or protected public spaces. I am sure that the right hon. Gentleman would welcome that approach.

Does my right hon. Friend accept that the sequential test, the needs test and other tests, as part of PPG6 and then PPS6, have been largely successful in revitalising our town and city centres? Will she explain precisely what will be the effect of the change from the needs test to the greater and stronger impact test? What will be the effect on the balance of development between out of town and city and town centre locations? Does she accept that developers need long-term certainty if they are to assemble sites and carry out the complicated work of development in city and town centres, and that significant changes to the planning system can undermine that and stop developments going ahead?

I do accept my hon. Friend’s point, which is why we will consult on the new, stronger impact test to make sure that it takes such considerations properly into account. The impact test will be stronger because, for some of the reasons that I set out earlier, the needs test does not always work in favour of town centre development at the moment. The needs test can prevent appropriate town centre development from going ahead by protecting out-of-town developers who already have capacity and who can argue that no need exists for new town centre development. That does not promote the vitality or sustainability of town centres, help consumer choice or respond appropriately to market forces. In developing the new test, we have a real opportunity to underpin the reforms so far and to continue to create thriving, sustainable town centres in future.

The Secretary of State says in her statement that she wants to strengthen the role of local government and devolve further decision making to local communities. May I suggest one area in which doing so would receive widespread approval in the House: the impact of PPG3 and the density to which builders are allowed to build? I do not know whether it is happening in her constituency, but in towns across the country, such as Stratford-on-Avon, the look of streets of family houses with gardens is being ruined when one house is bought by a developer, knocked down, and houses are crammed on the site at 15 to the acre. That is not appropriate, and local planning authorities need to have greater discretion over whether they approve such developments.

I completely agree with the hon. Gentleman, which is why we recently introduced a new draft planning policy statement 3. Its purpose, among others, is precisely to give local councils more flexibility to set their own densities. I urge him and his local council to study the new planning policy statement, as I think it gives exactly the flexibility for which he is asking.

Is the Secretary of State not concerned that by setting up an infrastructure planning commission we are reducing democracy in this country by effectively devolving powers to an unelected commission that is accountable to Parliament only for its performance and not for its decisions, and that major issues such as nuclear power stations could be pushed through without any democratic vote or voice whatever?

No, I do not agree with my hon. Friend. I would not argue for a second that the current system allows democratic input at the final stage of a decision-making process by Ministers. Ministers act in a quasi-judicial role when they make decisions on planning applications. They cannot exert independent political judgment on those issues. They have to take decisions based on the evidence presented in front of them. In fact, by being more streamlined and more transparent, and by specifically involving local people at every stage of the process, the new process will make it easier for that democratic debate to happen and for early input into the process to influence the outcome.

In the Secretary of State’s statement, she mentioned power plants once and energy projects once, raised the spectre of energy shortages once, and spoke about energy security three times. Given that Ministers will be able to issue national policy statements, there is a real concern that the White Paper and the legislation that falls from it is simply designed to pave the way for the early building of new nuclear power stations, which are massively opposed in Scotland. Will she confirm that any legislation that falls from the White Paper, while it may be applicable in England and Wales, will not apply to Scotland in that regard?

Although I think that the hon. Gentleman misunderstands the proposals, I can give him the confirmation that he seeks. That matter applies to England and Wales, and not to Scotland, which has devolved responsibility for some of the issues. Perhaps I should have referred to wind farms more than I did to energy security.

I welcome the easing of planning application requirements for minor alterations to properties, but will the Secretary of State assure me that there will be no retrospective changes to the protection offered to estates such as the Moorpool estate in my constituency, which got an article 4(2) direction only last year requiring planning applications for porches and minor changes?

In the future regime, as set out in the White Paper, we envisage that local authorities will still have the power to put in place appropriate safeguards in their areas where they think that is necessary for heritage or other reasons. I can give my hon. Friend the assurance that she seeks.

How big will the commission be? How many members will it have? How will they be selected? Will the appropriate Select Committee in this House have the opportunity to vet those members before they are appointed? How can we be sure that the commission will operate consistently? Will the members be full-time, and will they each attend every inquiry?

The hon. Gentleman makes incredibly important points about the future composition of the infrastructure planning commission. We envisage that some of the members will be full-time, some will be part-time. There will be a broad spectrum and range of expertise so that the commission can draw on some of the members’ expertise, depending on the type of inquiry. Clearly, we have asked a range of questions in the White Paper to get opinions from people, so that they can have their say and we can draw up the best possible composition, procedures for appointments and so forth for the infrastructure planning commission. We will set out our proposals in due course.

My constituents are not opposed to brownfield development per se; indeed, in many cases, they actually welcome it. However, from time to time they feel it necessary to challenge over-intensive, unsustainable and downright profiteering applications. Will my right hon. Friend give me an assurance that nothing in the White Paper will reduce their ability to challenge such overblown applications, or the ability of councils to tone them down or reject them outright?

I can give my hon. Friend that assurance. We have the Town and Country Planning Act 1990, and the local inquiry process will proceed as I have set out. There will be opportunities for local people to have an input to challenge applications. Although the appeals systems will be streamlined, it will work more effectively. However, I hope that we will have a system whereby we are less reliant on applications being called in to be determined by Ministers and whereby local people and local council members can determine more of the appeals themselves.

Last Friday, a public inquiry into a National Grid proposal for a gas plant in my constituency was concluded. I will not ask the Secretary of State about it, because in due course she will be advised by the planning inspector and will make a decision. However, her proposals mean that instead of the planning inspector making a recommendation and the Secretary of State, as a democratically accountable politician—accountable to the House of Commons—making a decision, the decision will in future be made by an unelected quango. Why should my constituents have more confidence in the proposed arrangements than in the present system?

The simple answer is that there will be an opportunity for earlier engagement of the hon. Gentleman’s constituents in the drawing up of the original policy. At present, it is incredibly difficult for them to have a say. When a national policy statement involves a specific local impact, that will be taken into account in the way in which it is drawn up. I would argue that there will be more opportunity for public engagement under the proposed arrangements than there is in the current system.

Three years ago, agencies and officials proposed an urban development corporation for North Staffordshire. Thankfully the Government turned down the bid. I for one had little confidence in the quality of the advice provided by unelected local officials, or indeed in their real democratic accountability. Before the Secretary of State changes the system, will she reflect on the fact that for Members of Parliament working with enlightened councillors of all political persuasions, influencing planning committees is often the only effective leverage against large-scale inappropriate development?

Secondly—

Order. There is only a “first” when a Member asks a question.

I understand why my hon. Friend champions the rights of his constituents. However, I think we can make the whole process more effective, and secure better local engagement and influence when it comes to major infrastructure projects, by involving local people early in the debate and ensuring that developers consult them on the options before an application proceeds. The local inquiry will then provide another opportunity for engagement. I believe that the new system will be more acceptable to my hon. Friend’s constituents than the current one.

It took a five-year campaign and a year-long public inquiry to stop Associated British Ports building a huge container port at Dibden Bay on the edge of the New Forest. Does the Secretary of State accept that in many cases the larger the proposal, the wiser it is to allow a long time to elapse before a decision is made? I believe that if that process had been foreshortened, there would now be a huge container port on the edge of the New Forest. I also believe that we would not have heard the admission last September that what the protesters had said all along was true, and that, having denied it for all those years, ABP could massively increase the productivity of its existing container port—which, indeed, it is now proceeding to do.

I do not agree with the hon. Gentleman. The Dibden Bay application process cost £45 million, and ultimately the application was turned down. I understand that part of the reason was the impact on biodiversity. That could have been identified at the beginning of the process, during the drawing up of the national policy statement. In fact, it is precisely the sort of issue that ought to be identified in a national policy statement. If it had been identified then, there would have been appropriate public consultation, the developers would have known the Government’s proposals and policy, and the proposal would either have been accepted or would never have got off the ground, because the policy would have been made clear at the start. That must be a more effective system.

I beg to move, That the Bill be now read a Second time.

Our further education system has seen unprecedented investment and reform in recent years, and continued reform is vital if the United Kingdom is to become a country with world-class skills by 2020.

In the past, education was mainly to do with social progress, but with an economic stability dimension. Now, continued prosperity in our country depends on high-quality education and training for all learners. However, social progress is, of course, still an important dimension. Good-quality training leads to higher remuneration and job satisfaction and a fuller life.

According to Lord Leitch’s review, we need a dramatic expansion of our nation’s skills at all levels. The analysis suggests that by 2020 Britain will need 4.6 million more people with intermediate-level skills and that there will be merely 600,000 unskilled jobs in the economy, compared with 3.2 million at present. The analysis also suggests that at least 40 per cent. of jobs will require graduate qualifications. Leitch also pointed out that 70 per cent. of the 2020 work force have already completed their formal education. The further education system is therefore central to meeting the Leitch challenge.

Our 14-to-19 reforms are steadily opening up a wider range of options through a more intimate association with the workplace, apprenticeships and, from next year, diplomas. The aim is to encourage all facets of lifelong learning—the gaining of skills for employability or social development—but the principal focus must be on giving people the skills they need to secure worthwhile jobs. We want this country to have full and fulfilling employment.

We have increased investment in further education: funding for post-16 learning has increased year on year to £11.2 billion in the current year of 2007-08—a 48 per cent. real-terms increase since 1997. As a result, the FE sector educated and trained more than 4 million adult learners in 2005-06. More adult learners than ever before are taking up basic skills courses, and more employers are telling us that they are satisfied with the training of the staff whom they are employing. According to the Learning and Skills Council national employer survey, the proportion of employers classified as “very satisfied” with FE provision rose by 10 per cent. between 2003 and 2005.

However, our journey is far from ended. Lord Leitch has raised our sights, and we should be grateful. Existing targets are worthy but not nearly ambitious enough. We must aim to put Britain among the very best in the world, recognising that the skills challenge will define the winners and losers in the global race for the top.

The Bill builds on the reforms we announced in our White Paper of March 2006, which itself was modelled on the Foster review. It will lock in the progress we have made so far and boost the capacity of the FE system to deliver. We consulted widely on the White Paper and have debated the issues extensively. I look forward to continuing the debate with Members as the Bill progresses through the House.

I believe that we start from a consensus that recognises the importance of FE for our learners, employers and the economy, that appreciates the potential of our FE system and those working in it, and that accepts the need to make sure that FE provision is of the very highest standard. We have an excellent range of colleges and providers, and I pay tribute to the many excellent teachers and principals who are working tirelessly to meet the 2020 challenge. I also pay tribute to the LSC, which is a valued partner in this process.

On that point, my right hon. Friend will be aware of an exchange that I had with the Deputy Prime Minister about the wonderful West Cheshire college, which is in my constituency and that of my hon. Friend the Member for City of Chester (Christine Russell). It has made representations to me about where it fits in and its relationship with the LSC in respect of the clauses that were defeated in the Lords on the dismissal of senior college staff. I share its view that it would be a mistake to reintroduce those clauses. Will my right hon. Friend give me an assurance that he will listen carefully to such representations?

I can give my hon. Friend an assurance that we are listening carefully to representations, and I shall come on to what we plan to do with that particular aspect of the Bill.

The Bill is divided into four parts. Part 1 relates to the Learning and Skills Council for England. The Bill will restructure the LSC to make it as efficient and effective as possible in managing system reform, and more adaptable to the changing requirements of employers and learners. We propose to remove the 47 statutory local learning and skills councils and replace them with nine regional committees and a network of about 150 local partnership teams. That combination of a statutory regional structure and a flexible sub-regional structure will allow the LSC to respond quickly and effectively to the changing needs of individuals, employers and wider communities. The new slimmer and more focused LSC will promote more flexible working arrangements and reduce administrative costs, with savings of up to £40 million that can be passed on to the front line for the benefit of learners.

Will the Secretary of State tell us what he means by the new sub-regional structure that he has proposed for learning and skills councils?

First, I am delighted to see the hon. Gentleman in the Chamber. May I say how much we support his stance in seeking to convince his party to, in his words, “confront the evidence”? It is a huge compliment to Tony Crosland that the Opposition have someone such as the hon. Gentleman in their Front-Bench team.

Since the establishment of the LSC, all of us thought it was rather strange, to say the least, that although we had set up regional development agencies and a number of other regional structures, the LSC did not have a regional structure but 47 local learning and skills council organisations. That was a mismatch. Four years ago, we gave a regional dimension to LSCs, but the purpose now is to establish a full-blown regional committee.

As for local partnerships, in Greater Manchester one learning and skills organisation covers the whole area, but there will be 10 much leaner, much more flexible versions of the LSC that can deal with the different communities around Manchester. In a sense, that is devolution upwards to the region but, in another sense, it is a much more powerful approach to the LSC locally.

Clauses 11 and 12 allow the Learning and Skills Council for England both to make arrangements with Scottish Ministers and to allow it to take part in arrangements made by such Ministers in relation to assisting people

“to select, train for, obtain and retain employment”.

Will the Secretary of State explain how that will work under the LSC’s new regional statutory basis, as opposed to how it would work under the current framework?

The skills challenge is a United Kingdom issue. Indeed, the commission for employment and skills will be a UK-wide body, so there will be an umbrella organisation covering the whole UK. It is perfectly possible in that situation to make arrangements to ensure that the skills needs in aerospace, for instance, are properly matched, and that the skills needs in other Great British industries do not stop at Hadrian’s wall or, indeed, the Welsh border, and that there is a co-ordinated approach across the United Kingdom.

Having worked in a previous incarnation for a training and enterprise council, and having experienced four reorganisations in the past five years, may I ask whether the Secretary of State seriously believes that the training and skills needs of, for instance, Kingston upon Hull, are the same as those of Northallerton, Selby, Skipton and Ripon? If he does, will he advise the House why that is the case?

No, of course I do not believe that that is the case. However, I believe that we need a strategic overview of skills in each of the nine regions in exactly the same way that there is an overview of all other aspects of economic development. Indeed, since their foundation, the RDAs have said that is necessary.

In fact, the local learning and skills organisation in Hull will be much better, in that it will allow us to concentrate on matters such as logistics and issues relating to the aerospace industry as they pertain to our area. In contrast, the present structure means that a larger organisation covers both sides of the Humber.

I agree with my right hon. Friend’s response to that question, but does he agree that we must ensure that the quality of further education is raised to an equal level across the whole country? In that way, we will establish local flexibility, and equity for everyone.

My hon. Friend makes the crucial point about the Bill. The Foster report, the White Paper and these proposals have all been aimed primarily at lifting quality so that the hugely high standards of FE are uniform right across the country.

Will the Secretary of State square what seems to me to be a paradox? He is embedding the LSC’s planning function at regional level, even though the Leitch report—to which he has quite properly paid attention—says that planning bodies such as the LSC will require “further significant streamlining”. That seems to be a paradox, at the very least, if not a contradiction.

It is not a paradox. The hon. Gentleman has said several times that we should have delayed the Bill and used it as a response to Leitch. We believe that the Bill is about supply, whereas Leitch was concerned primarily with demand. The Bill deals with the specific reference to streamlining in his report. It is a £40 million streamlining of the LSC, which is why Lord Leitch is extremely supportive of the proposals.

Will the Secretary of State give way?

I will give way once more, and then I want to make progress.

The right hon. Gentleman has been extremely generous. He says that the Bill’s restructuring of the LSC will save £40 million, but does not the regulatory impact assessment suggest that the real cost will be something in the order of £55.7 million, a total that is subject to change when we have the final figures? I may have misunderstood what he said, so will he confirm that the LSC’s 2005-06 annual report attributes the £40 million of savings to some 1,300 staff losses? Does that not mean that the £40 million has been rationalised already, without the abolition of the local skills councils?

We are talking about a further reduction, but the £55.7 million is a one-off cost to secure an annual saving of £40 million. An initial investment made a couple of years ago reduced the LSC’s administrative costs from 4.6 per cent. of its total budget to just 1.9 per cent. That is an example of invest to save.

The education and training on offer must be both attractive to prospective students—appealing to a broad range of abilities and interests—and lead to qualifications that are useful to employers. New duties will also be placed on the LSC to encourage diversity, and to increase opportunity and choice in education and training provision.

It is essential that we listen to what learners and employers tell us that they need, and that we put public money to best use by designing provision accordingly, instead of implementing what the Government or FE colleges think that employers and learners need.

I held an event at Highbury college in my constituency last year, which was attended by the Under-Secretary of State for Education and Skills, my hon. Friend the Member for Corby (Phil Hope). We brought together employers, FE providers and young people, but there seemed to be something of a mismatch between what the college was providing and what the employers wanted. Highbury college is very much in favour of being able to award its own foundation degrees. I am sure that my right hon. Friend will come on to that later, but does he think that that will be a key element in making sure that we get that correlation right?

I do, and the interesting fact that Foster pointed out—in a report that I am proud to say I commissioned when I was Minister of State in this Department—was that 80 per cent. of employers never go anywhere near an FE college. That shows that awareness of what employers need is crucial to the future of FE colleges.

We need to ensure that we are providing what colleges and employers need. That is why we have included a duty in this part of the Bill that the LSC must have regard to guidance on consulting employers, learners and prospective students, as it oversees further education provision in a system that is increasingly led by the demands of learners and employers.

Further measures in this part seek to clarify the power of the LSC to form and invest in any type of company in the provision of education and training, with the consent of the Secretary of State, and to design, develop and operate support services on behalf of individuals and educational institutions, again with consent.

On the point about diversity, does the Secretary of State envisage this being about diversity of providers or diversity of courses?

It is obviously about both, providing that we keep to the basic tenet of the Foster report and the White Paper that we are looking to prioritise those skills that are necessary to the future of individuals and the economy. In that sense, there is a huge diversity in provision and courses.

Coming from an industry background, and as a former member of the board of management of Clackmannan college, which is now part of Forth Valley college, I understand what the Secretary of State says about the need for employers to play a bigger role in determining the skills that employees need. However, we are moving into an ever-changing and faster-moving economy, with faster-moving skills and demands. Can we ensure that flexibility is built into the provisions he is discussing so that the educational system can respond with the speed that the economy needs?

That is an absolutely crucial point, which is why, in this part of the Bill, we are including the provision to form and invest in any type of company in the provision of education and training. Other measures throughout the Bill are particularly and precisely aimed at flexibility and the need to respond to changes. My hon. Friend is absolutely right: with the challenges of globalisation, we cannot set out something now based on what we believe the situation will be in 10, 15 or 20 years’ time. Even in terms of Lord Leitch’s report, we have to have the flexibility to change and adapt.

A further duty will be placed on the LSC to implement the skills and training strategies developed by other organisations, at the Secretary of State’s request. In particular, the London skills and employment board will be created—chaired by the Mayor of London—and an adult skills strategy will be developed and implemented by the LSC. That does not change the LSC’s obligation to comply with existing duties, unless I or my successors give express permission for the LSC not to implement a particular strategy.

The clauses in the second part of the Bill relate to further education institutions themselves. One of the most striking reforms—it is mildly controversial—will enable the Privy Council to grant FE institutions the power to award their own foundation degrees, which must currently be validated by a university.

My right hon. Friend will know that some of us have reservations about that because the point of foundation degrees was that they should be not merely stand-alone qualifications but part of a system that allowed people to come in and out of higher education. How will he ensure that the curriculums of foundation degrees granted by FE colleges are sufficiently matched with the curriculums of honours degrees to allow people to go on to shortened honours degree courses if they wish?

If my hon. Friend will forgive me, I will come on to that precise aspect in a second. However, I would just stress that, as I am sure she agrees, although it is important to have progression routes, we must ensure that if people do a two-year foundation degree and are content just to do that, we do not somehow devalue that. I know that my hon. Friend agrees with that. I will come on to the issue of progression.

This reform will make a huge difference to an individual’s ability to advance in his or her chosen career. Increasingly, employees need higher education qualifications to make progress; senior jobs are open only to graduates, and people without such qualifications are denied advancement. Foundation degrees provide a broad knowledge base and a multitude of career options for learners ranging from school leavers who prefer to work while they study, rather than begin a full-time degree, to adults returning to education or training. They are important qualifications in their own right, but—here I come to the point raised by my hon. Friend the Member for Warrington, North (Helen Jones)—they must also allow learners to move on to more advanced studies, including full degrees, should they choose to do so. We believe that 100,000 people will be taking foundation degrees by 2010, which will be a huge success considering those degrees did not exist before 2001. The Bill will make that aim a realistic possibility.

FE institutions must also have regard to guidance on the consultation of employers and learners, including potential learners, which mirrors the duty on the LSC under part 1 of the Bill. The Government are committed to an approach that builds services first and foremost around learners’ needs. All parts of the system must adopt that approach for this to work effectively.

My right hon. Friend will be aware that there is concern among the so-called modern universities—members of the CMU universities group—about permitting further education colleges to award degrees. Is he suggesting that the market will be so large in the future that the provision of universities will not be undermined by further education colleges expanding their degree courses?

I certainly am suggesting that. If 40 per cent. of jobs are to be filled by graduates and we have an ambition for 50 per cent. of 18 to 30-year-olds to be in higher education—not at university but in higher education, which will include taking foundation degrees in FE colleges—we can certainly reassure CMU universities about the concerns that they have rightly expressed.

This part of the Bill also aims to facilitate the way in which services are designed and delivered. It clarifies the powers of FE institutions to form or invest in companies providing FE training, or to form charitable incorporated organisations. In addition, powers to establish further education institutions or to dissolve FE corporations will be transferred from the Secretary of State to the Learning and Skills Council. Such measures are designed to encourage the use of new and innovative delivery models, such as federations, trusts and mergers, as part of our goal to broaden and diversify choice.

Along with a focus on the external influences on delivering FE reform, institutional leadership is vital. Provision is included for the Secretary of State to require college principals to achieve a stipulated leadership qualification before taking up a new post. We are working with partners to facilitate this. CEL—the Centre for Excellence in Leadership—has developed a new programme that, from September this year, all newly appointed FE principals will be expected to complete before they take up a post. Meanwhile, Lifelong Learning UK has published new standards for FE teachers, tutors and trainers and a specification for the role of FE principal. The Quality Improvement Agency has established a forum to allow practitioners and providers to share best practice.

Quality assurance is also essential. Excellence must be delivered as a matter of course, and when that is not happening, fast and effective intervention will be necessary. Members of the House of Lords; sorry, Members of the other place. A junior speech writer, I fear—[Laughter.] Some training will be carried out at a nearby FE college.

Members of the other place expressed concerns about some of our original proposals on interventions, especially the provision to enable the Learning and Skills Council to instruct an FE college to dismiss its principal if such an action were deemed necessary. I have listened to their concerns and we will shortly be publishing new proposals.

We will hold firm to our original intention to take action in instances of underperforming colleges, because without that power we do not believe that we can put forward these proposals with the necessary reassurance. While that intention remains— including instigating the removal of a principal, should that be warranted—in response to the concerns expressed in the other place, we will make sure that the intervention is scrupulously fair, transparent and legally robust.

I am grateful to the Secretary of State for giving way a second time. He is extremely generous. So that the House can be best informed about this aspect of his thinking, can he tell us how often the Secretary of State has found it necessary to use the existing powers, which include the removal of a principal? That would give us some feel for the legitimacy of the position that he is adopting by extending and enhancing those powers.

I do not think that we have used the powers—I will check—but having the provision available is a necessary means of ensuring that it never has to be used.

The remaining two parts of the Bill are shorter and more technical in content.

May I take my right hon. Friend back a moment to FE institutions and foundation degrees? Does he agree that the ability of FE institutions to provide foundation degrees will address some of the difficulties associated with rurality throughout the UK and allow a more equal spread of opportunity through delivery by the FE colleges?

I agree. That is a central feature of our proposals, to which I shall return.

I understand the powers described by my right hon. Friend as being necessary to serve as the ultimate deterrent, but will he confirm that that does not alter the fact that the college is the legal employer, not the Learning and Skills Council?

Yes, since incorporation that is exactly the case. I hope my hon. Friend will look carefully at our proposals. We have genuinely tried to address the legitimate concerns that he and others raised.

Part 3 of the Bill deals with industrial training levies. It seeks to amend the Industrial Training Act 1982 by modernising and streamlining the process that industrial training boards must go through to demonstrate support for a levy proposal among employers in the relevant industry. The measure will simplify the process, and reduce bureaucracy for all involved.

Some of the principles contained in part 2 are covered in part 4, in relation to higher education institutions, including clarification of their power to form and invest in companies, and a new power to form charitable incorporated organisations to encourage new delivery models. These powers are contained in a separate part, as they seek to amend different legislation. The fourth part of the Bill will also enable the Welsh Assembly to introduce FE reforms as it completes its current review.

In conclusion, this is an enabling Bill. It will enable a restructuring of the Learning and Skills Council, generating around £40 million a year in savings for service provision.