The Government took action against two types of avoidance schemes involving the leasing of plant or machinery at PBR 2007. Further disclosures and other evidence indicates that two further types of avoidance schemes involving the leasing of plant or machinery have placed, and could continue to place, substantial sums of tax at risk.

Tax avoidance is unfair on the majority of taxpayers and can undermine the funding of public services. The Government are determined to take appropriate and prompt action to counter tax avoidance. Therefore the Government propose to introduce appropriate legislation in the 2008 Finance Bill that will be effective from today, 13 December 2007.

A draft of the material that will be contained in Finance Bill 2008, together with draft explanatory notes and background material, will be published today on HMRC’s website at: http://www.hmrc.gov.uk. HMRC’s technical note giving the relevant background to this measure has been deposited in the Libraries of both Houses and is also accessible on HMRC’s website.

I announced to the House on 7 November 2007 that the Government had decided to delay final implementation of the Companies Act 2006 until October 2009, in the light of advice from the Registrar of Companies that he can not be absolutely confident of implementing the necessary changes to Companies House systems and processes by October 2008. I also explained that we would consult key stakeholders about the commencement date for provisions due to be commenced in October 2008 which do not necessitate changes to Companies House systems and processes.

In the light of our discussions and meetings with key stakeholders, the Government have decided that the following provisions, listed in my earlier statement, should be commenced with effect from 1 October 2008:

sections 69 to 74: objection to company names;

sections 82 to 85: trading disclosures;

sections 155 to 159: provisions relating to corporate directors and under-age directors;

sections 175 to 177: general duties of directors in respect of conflicts of interest;

sections 182 to 187: declaration by a director of an interest in an existing transaction or arrangement;

repeal of the restrictions under the Companies Act 1985 on financial assistance for acquisition of shares in private companies, including the “whitewash” procedure.

In view of the strength of business representations and of further advice from the Registrar of Companies, the Government have decided in addition to commence with effect from 1 October 2008:

the new procedure for private companies to make capital reductions supported by a solvency statement instead of by a court order.

Stakeholders highlighted the major benefit to business of implementation in 2008 of this new procedure. The Government had originally not proposed this, because it would require some changes to Companies House systems and processes. We have looked at this again in the light of the points made by business, and I am pleased to say that the Registrar of Companies believes that the necessary changes can be made by October 2008.

There are also two sets of provisions which we have decided to commence with effect from 6 April 2008:

sections 121 and 128 (register of members: removal of entries relating to former members);

sections 811 (4), 812 and 814: inspection of register of interests in a company's shares.

I aim to make before Christmas a commencement order in respect of all provisions to be commenced in 2008, other than those relating to capital reduction supported by a solvency statement and the removal of special provisions about accounts and audit for charitable companies. The capital reduction provisions (including section 654 on distributions of reserves arising from a capital reduction) will be commenced through a separate commencement order to be laid in draft in 2008. There will also be a separate commencement order on the audit of small charitable companies.

I have decided to appoint the new board members listed below:

Professor John Brooks

Peter Allen

Susan Williams

Robert Hough

Cllr Anthony McDermott

All the new appointments will be for a period of three years.

The appointments began on 14 December 2007 and will expire on 13 December 2010.

I have placed further details of the appointments in the Library of both Houses. They were all made in accordance with the code of practice of the Commissioner for Public Appointments.

BIOGRAPHIES

Peter Allen MBE is a Cumbrian hill farmer based near Penrith.

As Chair of the Sheepmeat and Goatmeat Advisory Committee to the EU, he has been involved in reforming and implementing the European sheep regime. Peter for many years was actively involved with the NFU, representing farming and rural issues locally, regionally and nationally. With many others he worked with aspects of industry and Government to control and eradicate foot and mouth disease in 2000-02, and he was the only farmer member of the Royal Society Inquiry into Infectious Diseases of Animals 2001-02. He is currently Chair of the NFU, Mutual Northern Area board, Chair of RUMA—(UK body promoting the Responsible Use of Medicines in Agriculture), and a board member of Natural England and the North West Regional Environment Protection Advisory Committee.

He holds no other ministerial appointments and has not taken part in any political activities in the last three years.

John Brooks is the vice-chancellor of Manchester Metropolitan University. In his previous job at the university of Wolverhampton he chaired a regeneration project after the closure of Rover, which involved infrastructure development and small business support.

In 1992 to ’98 he helped to create Bodycote-SHU Coatings, a company that offers tool manufacturers the opportunity to use physical vapour deposition coating machines. He chairs the board of the Equality Challenge Unit, and is on the Boards of Universities UK (and their long term strategy group), the Oxford Road Corridor Partnership and the Universities & Colleges Employers Association.

He holds no other ministerial appointments and has not been involved in any political activities in the last three years.

Robert Hough was Deputy Chairman and latterly executive director of Peel Holdings for over 13 years and a non-executive director of a number of other companies, including Cheshire Building Society, Alfred McAlpine plc and Provident Financial plc. Peel’s businesses include airports, ports, land use, planning, development, waste, energy and the environment.

A board member of the university of Manchester and a member of the North West Regional Assembly executive board, he also chairs New East Manchester Limited (one of the first urban regeneration companies to be established) and is a member and former Chair of the North West Business Leadership team.

He lives in Bowdon in Cheshire.

He holds no other ministerial appointments and has not taken part in any political activities in the last three years.

Tony McDermott MBE is a resident of Widnes and leader of the Council. He was educated at St. Edward’s college Liverpool, and Manchester University. He taught in Lancashire and Liverpool for 34 years.

He is a board member of the Local Government Association Improvement and Development Agency, the Mersey Partnership, and the North West Improvement Network. Chair of the North West Regional Transport Group, leader of Halton borough council and former Chair of the North West Regional Assembly.

He is a member of the Urban Commission Executive and the Northern Way Transport Compact.

He is a supporter of Asbestos Victims Support Group and a board member of the Five Boroughs NHS Mental Health trust. He holds no other ministerial appointments.

Susan Williams was a nutritionist for the charity Action and Research into Multiple Sclerosis until 2001. She became Conservative leader of Trafford borough council in 2004.

Member of the Manchester Enterprises board, the Association of Greater Manchester Authorities Economic Development board and the Trafford Local Strategic Partnership board.

She has acted as a political agent for the Conservative party. In 2001 she stood for Parliament in Wythenshawe and Sale East, and in 2006 she was selected as the Parliamentary candidate for Bolton West.

She lives in Altrincham, in Cheshire.

She holds no other ministerial appointments.

I am informing the House that I have signed the Central-Local Concordat on behalf of Her Majesty’s Government. The Concordat was co-signed by Sir Simon Milton, Chair of the Local Government Association.

This historic new written agreement establishes for the first time a framework of principles for how central and local government work together to serve the public. Central Government departments and councils have committed to uphold these principles.

The Concordat meets a key commitment set out in the Governance of Britain Green Paper earlier this year in delivering a fundamental transformation in the way we govern. It sets out the rights and responsibilities of central and local government.

It is explicit that powers are best exercised at the lowest effective and practical level, enshrining the Government’s commitment to decentralisation and devolution of power to councils, communities and citizens.

In addition it sets out key priorities which central and local government will deliver together, including tackling antisocial behaviour and crime, delivering good local services, more opportunities for young people, and promoting enterprise. It is an important step towards building local communities which enjoy economic prosperity, safe and stable streets and estates, a clean environment, and opportunities for all citizens to shape their own futures.

A copy of the Concordat has been deposited in the Libraries of both Houses.

The Government’s commitment to provide decent final salary pensions for those employed by local authorities and other organisations associated with local government is matched by the need to ensure that members’ pensions are secure, affordable and viable, and fair to taxpayers who guarantee their security.

The Government see it as critical to maintain stability of costs in the scheme over the years ahead, particularly in the new-look Local Government Pension Scheme (LGPS) in England and Wales from 1 April 2008. The intention remains to ensure that no additional costs are imposed on taxpayers or employers. This objective is central to any considerations involving amendments to the scheme’s regulatory framework.

A statutory consultation with all scheme stakeholders in England and Wales on proposals to extend the current levels of protection in the scheme for older employees began on 5 July 2007 and ended on 1 October 2007. The protections were originally introduced by the local Government Pension Scheme (Amendment) and (Amendment No. 2) Regulations 2006 and took effect from 1 October 2006. The draft proposals would involve amending the regulations to provide a full, rather than a tapered, protection for the period 2016 to 2020, together with appropriate offsetting savings for the estimated cost of this benefit improvement.

To ensure the continuing solvency of the scheme and to meet the Government’s standing policy on ensuring no adverse effects on taxpayers, the costs of implementing any scheme amendments to improve the level of protections would need to be provided from within the scheme.

The costings for the additional rule of 85 protections were provided by the Government Actuary’s Department (GAD), based on the data provided for the 2004 LGPS actuarial valuation exercise. GAD estimated that the capital cost of removing the current tapered protections between 2016 and 2020 was some £0.35 billion—£0.4 billion. In payroll terms, this equates to about 0.1 per cent. or some £25 million annually for 20 years.

If no agreed means of providing the necessary resources to extend the proposed level of protection emerge from the consultation, then it will be necessary to retain the present level of protection.

The responses received to the recent consultation exercise have been considered carefully and analysed against agreed criteria regarding affordability and legality, as set out in the Department’s consultation letter of 5 July.

The consultation has demonstrated strong views from all stakeholders in terms both of the level of protections and affordability. I wish, however, to be clear about the most recent position in the scheme regarding costs, the likely numbers of potentially affected older scheme members, and the range of other cost-influencing variables.

In the light of these representations, I have taken no final decision on the outcome of the statutory consultation exercise and, in view of the data from the 2007 LGPS actuarial valuations which are due to become available early in the new year, I have decided to ask the Local Government Pension Scheme Policy Review Group, with the assistance of GAD, to undertake a fresh costings exercise using emerging data from the 2007 LGPS actuarial valuations. This will allow a new assessment of the current cost position and also provide an opportunity for all the interested stakeholders to engage fully in the review process.

The exercise for updating of costs is expected to be completed early in the new year. A final decision on the proposed amendment and within the policy parameters of affordability and legality will then be made, taking full account of any further representations which may be made by stakeholders.

This statement follows on from that made by my right hon. Friend the Secretary of State for Defence on 3 July 2006, (Official Report, column 28WS) which covered the intent to close RAF Brampton. Once DE&S units have vacated the site, the Programme to Rationalise and Integrate the Defence Intelligence Staff (DIS) Estate (PRIDE) will relocate those remaining to RAF Wyton. The programme’s aim is to collocate a number of Defence Intelligence Staff (DIS) departments to one state-of-the-art, purpose-built facility at RAF Wyton. New service accommodation will be constructed at RAF Wyton in order to accommodate those moving to the base.

In order to maximise the benefits of DIS co-location at RAF Wyton, PRIDE increment two will move the Joint Aeronautical and Geospatial Organisation headquarters and elements of 42 Engineer Regiment (Geographic) currently based at Hermitage, West Berkshire, to join the Intelligence Collection group headquarters and Joint Air Reconnaissance Intelligence Centre at RAF Wyton. The Royal School of Military Survey, currently at Hermitage, will assimilate with other training elements at the DIS site at Chicksands. Our intention is that these moves will lead to the disposal of the Hermitage site, subject to continued value for money being proven.

The move will directly result in the loss of approximately 30 posts currently based at Hermitage, mostly in the support roles. MOD will work to minimise the impact to those affected by providing all the help it can, relocating personnel and avoiding compulsory redundancies where possible.

I told the House on 4 December that, following the board of inquiry’s report about the loss of Nimrod XV230, I would establish an independent review by a senior Queen’s counsel into a range of broader issues which were outside the scope of the BOI’s investigation. I am now able to set out the details of that review.

The review will be conducted by Charles Haddon-Cave QC. Mr. Haddon-Cave has wide experience of aviation and safety matters, having been instructed in all the major aviation and marine inquiries in England in the last 20 years. His report will be published in fall, subject to considerations of operational security, together with my response to it.

The terms of reference for the review are as follows:

In the light of the board of inquiry report:

to examine the arrangements for assuring the airworthiness and safe operation of the Nimrod MR2 in the period from its introduction in 1979 to the accident on 2 September 2006, including hazard analysis, the safety case completed in 2005, maintenance arrangements, and responses to any earlier incidents which might have highlighted the risk and led to corrective action;

to assess where responsibility lies for any failures and what lessons are to be learned;

to assess more broadly the process for compiling safety cases, taking account of best practice in the civilian and military world;

and to make recommendations to the Secretary of State as soon as practicable, if necessary by way of interim reports.

Appropriate technical expertise will be made available to the reviewer. The reviewer will be able to recommend a public inquiry if he considers this necessary.

The review will have the full support of the Ministry of Defence. All relevant papers will be made available and everyone who can assist the review will be instructed to do so. In order to encourage openness, evidence given during the course of the review will not be used in disciplinary proceedings against the individual who gave it unless there is evidence of gross misconduct. The MOD will also provide Mr. Haddon-Cave, at his request, with a secretariat for the review.

BAE Systems and QinetiQ have confirmed that Mr. Haddon-Cave will have their full co-operation. The MOD and the companies are committed to ensuring that the review has available to it all the technical expertise that it will require. I would expect any other companies whose assistance may be required to follow suit.

Mr. Haddon-Cave will ensure that the families are kept informed of the progress of the review.

It is of the utmost importance that an authoritative and independent analysis is conducted of the background circumstances to the loss of Nimrod XV230. The task which Mr. Haddon-Cave has undertaken will be complex but I have asked him to ensure that information that would assist our understanding of this tragic loss is published without undue delay.

The Ministry of Defence (MOD) has today launched its strategy for creating greater innovation within the defence supply chain. The MOD innovation strategy builds on the Defence Industrial Defence Strategy (DIS) published in 2005 as a Defence White Paper (Cm6697). The DIS set out a commitment to achieve a better understanding of the innovation process within the defence supply chain.

The new innovation strategy identifies the main challenges to innovation in delivery of our defence capability. It expresses actions to address these challenges in terms of five distinct pillars. These pillars show our intent to articulate our capability needs better, provide transparency in how we translate these needs and aspirations through to delivery of capability, highlight our commitment to open architectures which will in turn foster insertion of new or improved technology, demonstrate our commitment to new business models that provide incentives for both customers and suppliers to achieve greater innovation and communicate our desire to maintain the pace of MOD’s acquisition processes.

The Department for Environment, Food and Rural Affairs 2007 Autumn Performance report will be published today. The report highlights progress since the publication of the departmental report in May towards the Department’s outstanding Public Service Agreement targets. Copies will be placed in the Libraries of both Houses. The report is also available on Defra’s website.

I announced on 7 September that I had asked Sir Bill Callaghan to lead a review of the regulatory framework for handling animal pathogens.

The purpose of the review was to take forward recommendations of the HSE’s report on potential breaches of biosecurity at the Pirbright site in 2007 and Professor Spratt’s review of the safety of UK facilities handling FMD virus; in particular to consider:

Any changes needed to clarify and strengthen the regulatory framework for animal pathogens, in the light of that for human pathogens,

Any steps needed to ensure independence and clarity on the separate roles and responsibilities of funders, regulators, customers and the institutions themselves, and

Any steps needed to provide clear lines of accountability, inspection protocols and responses to non-compliance.

Sir Bill Callaghan was assisted in his work by representatives from HSE, HPA , DEFRA, the farming community and Professor George Griffin (Chairman of the Advisory Committee on Dangerous Pathogens). I am very grateful to Sir Bill and his team for the swift and thorough way in which they have completed their task.

I am accepting all of the recommendations set out in the report and I am determined to ensure that DEFRA works quickly with the other Departments and agencies involved to take forward the necessary changes. I set out in more detail below the position in respect of each recommendation.

The regulatory framework for specified animal pathogens was first introduced in 1993, and there have been limited changes since then. The report recognises that there are in fact three overlapping but separate sets of legislation which apply to the handling of human and animal pathogens. This does not reflect the spirit or the substance of Hampton principles and making changes here will also be of benefit to the industry in making the rules that they must work to clearer and more coherent.

I agree with the recommendation that DEFRA should not continue as regulator of laboratories handling animal pathogens because the report finds there was a conflict of interest. This was an area where I was particularly keen to have an independent view, as I felt that this was an issue that needed addressing. I acknowledge the comments that DEFRA’s weaknesses as a regulator in this context were as a result of the regulatory system, rather than because of failings on the part of individual inspectors and because of the level of expertise within DEFRA and the resource allocated to this work.

I also note the report’s comments that the primary responsibility for managing risks must lie with the top management of any facility where work on dangerous pathogens is carried out. Any regulatory system is only as good as the people being regulated. The regulator’s role, whoever that regulator may be, is to provide assurance that the systems in place will deliver the desired objective.

The UK has a very important science base, which has built an enviable international reputation. The research carried out in this country including at Pirbright, plays an important part, not only in supporting our response to disease outbreaks, but also in the international fight against existing and emerging diseases. This position inevitably means that there is a need to handle dangerous pathogens in UK laboratories. The public, farming community and others have a right to expect that all possible measures will be taken to protect them and the environment. That risk can never be zero, but as the report points out, the regulatory outcome we must seek to achieve is one that provides an assurance that the risk of accidental release is as close to zero as possible.

I am depositing copies of their report in the Libraries of both Houses today.

The report is also available at:

http://www.defra.gov.uk/animalh/diseases/fmd/investigations/bill-callaghan.htm

I will keep the House informed of developments.

The Russian authorities announced yesterday that they planned to shut down the British Council’s offices in St Petersburg and Yekaterinburg on 1 January 2008.

Russia’s threatened actions are illegal. The British Council’s presence in Russia is entirely consistent with international law, including the Vienna Conventions. Its presence and activities are also specifically sanctioned by a 1994 UK/Russia Agreement on Co-operation in Education, Science and Culture, signed by Russia, and which binds both the UK and Russia. The British Council is the designated agent of the British Government for the implementation of the agreement. For the past nine years, the UK has been keen to conclude a further Cultural Centres Agreement with Russia. Pending such an agreement being reached, the 1994 Agreement remains in force.

For Russia to carry out its threat would therefore constitute a serious attack against the legitimate cultural agent of the British Government, would show a disregard for the rule of law and would only damage Russia’s reputation around the world.

Damage will also be done to EU-Russia cultural co-operation. We are discussing with partners (including the EU and the G7), the implications of Russia’s threat. I am grateful to the European Commission for expressing its concern to Russia about the situation facing the British Council.

Overall, Russia’s threats set back bilateral and multilateral efforts to improve cultural links, severely affect large numbers of Russians who benefit from the British Council’s presence, and damage Russia’s reputation around the world. We are urging the Russian authorities to reconsider. At the same time we are working closely with the British Council to ensure the welfare of their staff.

I will keep the House informed of developments.

The House will be aware that, with the agreement of my right hon. Friend the Home Secretary, I wrote to US Secretary of State Condoleezza Rice on 7 August to request the release from Guantanamo Bay and return to the UK of five men who, while not UK Nationals, had been legally resident in the UK prior to their detention. These are the only individuals now at Guantanamo who have been identified as having been given leave to enter or remain in the UK under the Immigration Acts.

My right hon. Friend the Home Secretary and I decided to seek the release of the five in light of work by the US Government to reduce the number of those detained at Guantanamo and our wish to offer practical and concrete support to those efforts. In reaching this decision we gave full consideration to the need to maintain national security and the Government’s overriding responsibilities in this regard.

Detailed and constructive discussions have since taken place between the British and US Governments, considering the circumstances of each individual case. The US agreed on 10 December that three of the five men—Mr. Jamil El Banna, Mr. Omar Deghayes and Mr. Abdennour Sameur—will be returned to the UK shortly as soon as the practical arrangements can be made. The Foreign and Commonwealth Office has been in contact with the families and legal representatives of Mr. El Banna, Mr. Deghayes and Mr. Sameur to let them know of this decision.

I should add that the decision to make this request does not constitute a commitment that they may remain permanently in the UK. Their immigration status will be reviewed following their return and the same security considerations will apply to them as would apply to any other foreign national in this country. As always, all appropriate steps will be taken to protect national security.

The US Government has expressed significant additional security concerns in regard to the cases of the other two men covered by the original request—Mr. Shaker Aamer and Mr. Binyam Mohammed. They have so far declined the request for the release and return of Mr. Aamer and we are no longer in active discussions regarding his transfer to the UK. We are still discussing with the US the case of Mr. Mohammed although again the US Government is not inclined to agree to his release and return.

Moving ahead, we will continue to discuss with the US Government how best we can work with them to see the closure of the Guantanamo Bay detention facility. We will continue to encourage our allies to consider taking steps similar to our own to reduce the numbers of those detained at Guantanamo Bay, such as accepting the transfer of eligible detainees, thereby hastening the closure of the detention facility.

The Government regret the unilateral decision by the Russian Federation to cease compliance with its obligations under the Conventional Forces in Europe Treaty (CPE) from 12 December. Russia has sought to explain this decision principally on the grounds that members of the North Atlantic Treaty Organisation (NATO) have not ratified the adapted version of the CFE treaty. Together with our NATO allies, the United Kingdom has made a public statement (http://www.nato.int/docu/pr/2007/p07-139e.html).

This Russian decision is unjustified. The United Kingdom, along with NATO allies, has made clear our commitment to ratify as quickly as possible the adaptation of the CFE treaty, which would provide the basis for addressing most of Russia’s concerns about the current CFE regime. But it remains right that Russia should in parallel honour its own commitments, made at the 1999 Organisation for Security and Co-operation in Europe summit in Istanbul, to regularise the status of its forces and equipment in Georgia and Moldova. The principle that host nation consent is required for the stationing of foreign forces is central to effective security and stability in Europe. NATO has engaged intensively with the Russian Federation to seek ways of overcoming differences over how to ensure both these sets of commitments are delivered.

The Government also consider that the Russian Federation’s “suspension” of their obligations cannot be justified either under the provisions of the CFE Treaty or on the grounds set out in the Vienna Convention on the Law of Treaties. Accordingly, on 11 December, we sent a Note Verbale, via the Treaty Depository, to all CFE States Parties, making this clear.

We judge, however, that European security is not fundamentally or immediately threatened by this Russian action. In the short term, we understand Russia will stop exchanging data or sending notifications on the whereabouts and composition of its conventional forces, and will refuse to allow verification inspections. However, if Russia were to persist in this course of action, in the longer-term that would erode the transparency and predictability which the CFE regime contributes to overall stability in Europe.

To help maintain that stability, the United Kingdom will until further notice, along with its NATO allies, continue to honour all our obligations under the CFE Treaty, including towards the Russian Federation. We will assess the impact of any non-compliance by the Russian Federation, and consult with NATO allies on a further joint response. With NATO allies, we will also continue to promote engagement with the Russian Federation with a view to reaching an agreed way forward.

The Employment, Social Policy, Health and Consumer Affairs Council was held on 5 and 6 December 2007. The health part was held on the 6 December. I represented the UK.

The Council adopted conclusions on the Portuguese presidency theme of health and migration in the European Union. In a policy debate, Ministers discussed the challenges and opportunities in health presented by migration.

Ministers welcomed the Commission’s EU health strategy, on which council conclusions were adopted. There was agreement that the EU strategy needed to complement national strategies, and that sudsidiarity must be respected. I highlighted the importance of tackling health inequalities.

Conclusions were also adopted on organ donation and transplantation and on nutrition and obesity responding to Commission communications on these subjects, and the presidency presented a progress report highlighting recent activities on the fight against HIV/AIDS.

Over lunch there was an informal discussion on health services, on which Commission proposals are expected shortly. Ministers urged caution: it was important to avoid creating inequalities through a system that allowed a few to shop around for care. The proposals should not go further than the ECJ jurisprudence, and member states should be able to use prior authorisation systems for hospital care.

Slovenia outlined their priorities in health for the forthcoming Slovene presidency. Cancer would be their main priority. They would also be taking forward work on anti-microbial resistance, and highlighting the implementation of policies to tackle alcohol-related harm and co-operation in the area of pricing and reimbursement of pharmaceuticals.

I am pleased to announce today the 2008-09 revenue allocations for primary care trusts (PCTs) and the NHS Operating Framework for 2008-09.

All primary care trusts will receive a cash increase of 5.5 per cent., a total cash increase of £3.8 billion, bringing the total revenue allocations to £74 billion. In addition, £1.7 billion of non-recurrent budgets are also being issued, meaning that 82 per cent. of the total NHS revenue budget will be issued direct to primary care trusts compared to 72 per cent. in 1996-97. Overall, we have trebled investment in the NHS from £35 billion to £110 billion by 2010-11.

I am keen to continue to raise the transparency and accountability of the NHS and, consequently, I have written individually to all hon. Members in England detailing their relevant PCTs’ allocations for 2008-09 and have noted how their current allocations compare to those for 2007-08. I have also included with this written statement a table detailing 2008-09 PCT allocations.

As I announced on 22 November, the revenue allocations will be for 2008-09 only, as the Advisory Committee on Resource Allocation (ACRA) has asked for additional time to finish their review of the current resource allocation formula. ACRA will complete their work shortly and we intend to announce allocations for 2009-10 and 2010-11 by summer 2008.

As the House will recognise, the NHS has made substantial progress over the past 10 years on investment and reform. Patients wait no more than four hours in accident and emergency, the health service has more doctors and nurses than ever before; and we have witnessed the largest hospital building programme since the NHS was founded.

As the NHS enters its 60th year, we must continue to drive forward with ever-greater determination, and so for the year ahead, the NHS has five principal priorities:

first, improving standards of cleanliness and tackling healthcare associated infections;

secondly, improving access to care through the achievement of the 18-week referral to treatment pledge and improving access to GP services, including at evenings and weekends;

thirdly, keeping adults and children well, improving their health and reducing inequalities, by focusing on improving care for cancer and stroke, and paying particular attention to children’s health, particularly in the most deprived areas of the country;

fourthly, improving patient experience, staff satisfaction and engagement; and

fifthly, preparing to respond in a state of emergency, such as an outbreak of pandemic influenza.

In addition to the national priorities, PCTs need to continue to improve at understanding the particular needs of their local populations and take concrete steps to address them. In order to meet their own local needs, PCTs will need to work in step with local government through local area agreements that focus on improving health and well-being.

Local priorities will build on evidence about current PCT performance and regional variation, and also plan for the future by incorporating work being done in local service reviews. Whether it is reducing mixed sex accommodation, personalising services for patients with learning disabilities or responding to the Healthcare Commission’s recommendations, local services need to respond to local needs.

Over the last 18 months, the NHS has continued to drive up the quality of care delivered to patients. This has been made possible by two significant achievements:

bringing the NHS to financial balance and going on to deliver a surplus; and

embedding patient choice, practice based commissioning, payment by results and foundation trusts, which all lead to better patient care.

In order to support this year’s NHS Operating Framework, we must continue to develop the necessary structures and leadership in order to enable world class commissioning.

The NHS must meet the needs of its patients and their families, the expectations of the public and the aspirations of its staff. At all times, the NHS must be safe, effective, personalised and fair. The more responsive and personalised the NHS gets, the better the care it will provide and the more confidence the health service will inspire.

I am pleased to inform the House that I have today placed in the Library the annual report of the Animals (Scientific Procedures) Inspectorate for the year 2006. This is the third annual report published by the Inspectorate.

Publication of the report honours a commitment given by the Government in response to a recommendation of the House of Lords Select Committee on Animals in Scientific Procedures in July 2002 that more information should be made available about the work of inspectorate.

The inspectorate’s third annual report published today explains what the inspectors do and how they do it, and provides details of the inspectorate’s staffing and structure, ways of working, professional background and skills, and training and development.

The report explains the inspectorate’s role in assessing, and advising Home Office Ministers and officials on, applications for personal and project licences and certificates of designation under the Animals (Scientific Procedures) Act 1986. It also provides details of the inspection system, through which compliance with licence authorities granted under the 1986 Act is monitored and about visiting patterns and practice and the number of visits carried out during the year.

The report explains the important role of inspectors in gathering and transmitting information on good practice and provides examples of the many events and initiatives to which the inspectorate made significant contributions during the year. In addition, this year’s report contains special features on scientific work conducted outside the laboratory setting and on poultry and also contains a report on a survey of local ethical review processes.

I commend the report to the attention of Members.

In September I announced that I was establishing an Advisory Committee on Civil Costs and that its chair would be Professor Stephen Nickell. I undertook to make a further announcement on the membership of the Committee and its programme of work.

The members of the Committee are Steve Brooker (National Consumer Council), Dominic Claydon (representing Association of British Insurers), Senior Costs Judge Peter Hurst, Professor Simon Roberts, District Judge Monty Trent and Fraser Whitehead (representing the Law Society). Additional members may be co-opted on to the Committee for specific issues, if appropriate. The Committee will commission research, collect data and receive submissions as required from a wide range of stakeholders to ensure that recommendations are evidence based and underpinned by economic analysis.

The first thing that I have asked the Committee to do is to provide advice to the Master of the Rolls on the guideline hourly rates for solicitors for the summary assessment of costs. The Committee will then consider any fixed recoverable costs proposed following our consultation: “The case track limits and the claims process for personal injury claims”. It will subsequently review the fast track trial costs. I will then make further decisions on the future programme of work. The Ministry of Justice will fund the Committee and provide the secretariat.

I am today announcing the publication of detailed operating proposals to deliver the commitments made in the Government response to the Home Affairs Select Committee inquiry into young black people and the criminal justice system. Details of these arrangements are contained in an action plan, copies of which have been placed in the Libraries of both Houses, the Vote Office and Printed Paper Office. The details will also be published on the Ministry of Justice website.

The Government responded to the Committee’s report on 18 October 2007 (Cm 7214), and committed to publishing detailed operating proposals for delivery of the commitments made in the main response. This statement summarises the governance structure and reporting arrangements that will drive and support delivery and enable Government to monitor and report progress on reducing the over-representation of young black people in the criminal justice system.

Ministerial Champion

I will act as the ministerial champion for this work.

Ministerial Leadership

The National Criminal Justice Board (NCJB) will provide ministerial stewardship and oversight of delivery of the action plan, reporting to the domestic affairs sub-committee on justice and crime as appropriate. Delivery of the commitments made and the associated work programme will be monitored, driven and reported through the Public Service Agreement (PSA) framework and existing departmental reporting arrangements. There will also be additional annual progress reports.

Official Leadership

The chief executive of the Office for Criminal Justice Reform is nominated the senior responsible owner for this work programme. Oversight at a senior official level will be provided by existing cross-Government groups with a specific focus on race issues.

External Advisory Function

The Equalities and Human Rights Commission will provide independent scrutiny and challenge functions for this work programme. In addition, a series of structured engagement events involving key commentators and community workers will be undertaken on a quarterly basis to draw on the knowledge and expertise of a wider group of individuals and organisations.

Today I have deposited copies of the Freedom of Information Act 2000 - Statistics on Implementation in Central Government. Q3 - July - September 2007 in the Libraries of both Houses. Copies are also available in the Vote Office and the Printed Paper Office.

This is the quarterly monitoring statistics report analysing the performance of central Government in the third full year of Freedom of Information.

Earlier this year, the then Parliamentary Under-Secretary of State for Justice, my hon. Friend the hon. Member for Bradford South (Mr Sutcliffe), outlined the Government’s intention to review the forum for preventing deaths in custody as one aspect of its continued commitment to bring about real changes and improvements to reduce deaths of people being held in our custodial care, and to report on progress to the house within six months (Official Report, 16 May 2007, Column 662).

I am pleased to report that the Government’s review of the forum is nearing its conclusion. A person entirely independent of the forum—Robert Fulton, a former Home Office director—is conducting the review and Ministers anticipate that he will deliver conclusions and recommendations by the end of the year. A further announcement will be made as soon as is practicable once Ministers—including those in the Home Office and Health with responsibilities for the custodial sector beyond prisons—have considered and decided upon these recommendations. The review has broad terms of reference and is taking account of other relevant organisational models; the forum’s independence from Government; its interaction with Ministers through the ministerial round table on suicide (which I chair); its membership, powers, resources and capacity; and the forum’s collective and individual accountabilities.

The review is making good progress. Mr Fulton, whose conclusions and recommendations will be made publicly available, has already seen a wide range of people with a close interest in this subject area and researched other relevant organisational models. I understand that he is likely to recommend substantial changes to the current arrangements with respect both to the forum and to the ministerial round table on suicide. Ministers will look at Mr Fulton’s recommendations quickly and sympathetically, with a view to strengthening the current arrangements within available resources.

I am launching today a consultation exercise on proposals and recommendations arising from the Electoral Commission review, led by the independent expert Mr. Ron Gould, into the conduct of elections to the Scottish Parliament in May 2007. In my oral statement to the House on 23 October, when Mr. Gould published his report, I accepted immediately the five core recommendations which taken together will have a direct beneficial impact on the experience of voters at future elections to the Scottish Parliament.

I confirmed to the House in my October statement that a number of other recommendations in the report would require wide ranging consultation with outside interests, including those responsible for the administrative conduct of elections in Scotland. At the same time, I stressed the importance of engaging with voters in these matters and will be seeking through the consultation exercise to reach as many as possible by both formal and informal means.

The paper is being sent direct to all MPs with Scottish constituencies and copies have been placed in the Library of both Houses. I hope as many hon. Members as possible will take the opportunity to let me have views on the points raised for consultation as well as any other relevant comment on ways of improving, particularly for the voter, these elections.

The consultation exercise will run to early March 2008 and I hope to publish a formal response to the Gould report, taking full account of views submitted during the consultation process, shortly thereafter.

The Gould report made also a number of proposals relevant to the conduct of local authority elections in Scotland. These are a matter for the Scottish Executive to determine.

The Employment, Social Policy, Health and Consumer Affairs Council was held on 5 December in Brussels. I represented the UK, except for the items on the working time directive and the agency workers directive where the UK was represented by my right hon. Friend the Secretary of State for Business, Enterprise and Regulatory Reform. Health, and consumer affairs issues were taken on 6 December.

The Council failed to reach an agreement on the worker mobility directive on supplementary pensions. The area of concern for other delegations was the maximum length of the period before a worker’s pension rights become unconditional. This will be taken forward by a future presidency.

There was also no agreement on the working time or temporary workers directives. The prospects for moving forward on these were discussed over lunch. My right hon. Friend the Secretary of State said the current working time text was a significant improvement on previous versions and whilst the UK still had some reservations, he believed that agreement was close. On agency workers, the presidency concluded—and member states agreed—that the text needed more work. The UK made it clear that it stood ready to support the presidency in future work to address outstanding issues.

The European Commission said it would consider withdrawing both directives but this suggestion was opposed by most member states including the UK. The presidency concluded that progress had been made but further in-depth discussion was needed on both directives, with the aim of an early and broad consensus.

Agreement was reached on parts of an implementing regulation for social security co-ordination Regulation 883/04, specifically on the chapters covering administration of unemployment and family benefits and the corresponding parts of an annex to the regulation.

The Council had a policy debate based on the recent Commission communication on services of general interest. I stressed, as did the majority of others that social services were important, both to individuals and more widely, and that quality was crucial. I also emphasised the need for subsidiarity and local and flexible delivery. While there was some common ground, the debate identified great diversity of situation and approach within and between member states and Ministers stressed the need for subsidiarity and exchange of experience and best practice. It was concluded that further work was needed in this area.

The Council adopted conclusions on flexicurity and endorsed a joint opinion of the Employment and Social Protection Committees on the subject. The Council also adopted conclusions and endorsed an Employment Committee opinion on future prospects for the European employment strategy in the context of the new cycle of the Lisbon strategy. The Council also adopted conclusions on active inclusion of people furthest from the labour market, women and poverty as part of the Beijing platform and on balanced roles for women and men as well as a resolution on follow-up to this year’s European Year of Equal Opportunities for All.

Slovenia outlined their priorities on employment and social policy for their forthcoming presidency starting in January, which will include “Employment of the Young”, “Equal Opportunities” and “Demography” as their three key presidency themes.

I notified the House on 23 October that the European Court of Justice has decided that for the purposes of European Law, three benefits—Disability Living Allowance (care component), Attendance Allowance and Carer’s Allowance—are incorrectly classified as special non-contributory benefits.

As a result of the judgment, these benefits are, in certain circumstances, exportable within the European Economic Area (EAA) and Switzerland. Customers will, of course, have to meet existing entitlement criteria to receive the benefits. Department officials met recently with officials from the European Commission to clarify the extent of the Government’s responsibilities following this judgment and discussions are continuing on this complex area of European legislation.

The Disability and Carers Service is currently preparing new guidance for staff and making arrangements to handle cases from abroad. In particular proper controls must be put in place to gather medical evidence from abroad to ensure that UK decision-makers are properly able to assess claims. We expect to provide full details on eligibility criteria on: www.direct.gov.uk by 5 April 2008. We anticipate that first payments could be made to eligible claimants shortly afterwards.

Today I am publishing “Ready for work: full employment in our generation”, the Government’s response to the Green Paper on welfare reform published in July 2007.

“Ready for work” sets out the strategy to create a society in which as many people as possible can share in the rewards of work—rewards that go far beyond financial independence, important as that is, because work is inherently good for people of all ages: good for their health, good for families and good for communities.

Today Britain is recognised by the international community as a leader in promoting employment and tackling disadvantage in the labour market. However, there are still too many people living on benefits who could work if they were given the right support.

Our response will be to move to a new system of active rather than passive benefits.

We want to see an employment rate of 80 per cent., up from the current baseline of 74.5 per cent., putting full employment at the heart of our anti-poverty strategy and enabling Britain to seize the opportunities afforded by a dynamic global economy.

In a new and radical approach, we will therefore increasingly look to move people from being spectators on the margins isolated at home—as recipients of passive benefits—to becoming participants, actively seeking and preparing for work with access to training and job-focused activity.

And we want to ensure that benefit claimants can train and improve their skills so that they are not only helped into jobs but also helped to stay and progress in work.

Currently benefit rules prevent JSA customers from studying full time for more than 16 hours per week, for more than two weeks per year. We will reform this. As I announced in November we will put in place the funding arrangements to ensure that JSA customers who would benefit from longer term, full time intensive and employment focused training would have the opportunity to do so by moving to a training allowance.

We will also remove the ‘16-hour rule’ in housing benefit completely for short-term recipients of incapacity benefit so that they, like long-term claimants, will always be able to take up training to enable them to return to work.

Lone parents who can work will be required to actively seek work once their youngest child is 12 or over from October 2008, 10 or over from 2009 and seven or over from 2010, supported by a flexible system of pre-work preparation and in-work support, and by the £21 billion we have invested in childcare since 1997.

Incapacity benefits for new claimants will go, replaced by employment and support allowance with the emphasis on what a person with a physical or mental health condition can do rather than cannot.

The new deal will be modernised so that it better meets the employment and skills needs of those who have been on benefit for a long time or who have struggled to find a stable pattern of work.

Jobcentre Plus has built up a truly world class record, and will remain at the heart of the system—working in partnership with public, private and third sector specialist providers which will have an enhanced role through new contracting relationships which we will set out early next year. Jobcentre Plus will also work in partnership with the Learning and Skills Council and Devolved Administrations to deliver an integrated employment and skills service. And with employers, opening up more jobs to disadvantaged people through Local Employment Partnerships.

In an era of record employment and with 680,000 vacancies to fill, our aim is to get British benefit claimants into British jobs to become British workers.

And we will do more to ensure that the long term unemployed, lone parents and those currently on incapacity benefit are better off in work even after reasonable transport costs.

The reforms that we are bringing in have a central goal: work for those who can, support for those who cannot, combating poverty through full employment.

That remains our welfare commitment and that is our way forward.