The EU Competitiveness Council took place in Brussels on 1 and 2 March 2010 and the following is a summary of those discussions.

The main Internal Market/Industry Council items discussed on 1 March were on industry policy, intellectual property rights enforcement and the Europe 2020 new long-term EU economic strategy.

Council conclusions on EU industrial policy were adopted after a debate involving divergent opinions between member states, particularly on how much focus there should be on electric cars. The UK (with support from a number of other member states) successfully argued for the importance of a technology neutral approach to EU support for low-carbon vehicle technologies. The UK also emphasised the need for open and competitive markets and for a horizontal rather than sector specific approach to EU industry policy.

A Council resolution on enforcement of intellectual property rights in the EU internal market, which the UK supported, was also adopted. The UK and others called for more transparency in the international anti-counterfeiting trade agreement negotiations. The Commission agreed to raise these transparency issues with the EU Trade Commissioner.

In the exchange of views on Europe 2020, the Commission outlined its main themes as being innovation, green growth and social inclusion. There was broad support for the Commission’s priorities, with emphasis on support for SMEs, better regulation, energy, infrastructure, internal market and competition. The UK stressed the need for increased EU venture capital (particularly for high technology investment) and the importance of the digital economy to the EU. There was general support for the Commission’s proposals on governance and for a more social dimension. The presidency undertook to report the Council’s discussion to the General Affairs Council ahead of the forthcoming European Council debate on Europe 2020.

At a ministerial lunchtime discussion, Professor Mario Monti discussed his preliminary views in advance of his forthcoming report for the Commission on re-launching the EU internal market. He wanted to promote to business and citizens better enforcement, free movement of services, implementing the digital agenda and real economy measures with acceptable regional, social and tax co-ordination policies. The Commission said it planned to follow up the Monti report with a Commission Communication in June 2010. The UK stressed the need to engage with business, to focus on growth and jobs and also the importance of services directive implementation.

The Any Other Business items discussed covered reports on the outcomes of the December 2009 Copenhagen conference on climate change and the February 2010 EU Informal Competitiveness Council on electric cars; updates on the EU internal market scoreboard of member states transposition of EU directives and on the EU internal market information system for administrative co-operation; progress on EU services directive implementation; and a Commission update on a proposed a private-public partnership model on the development of the future internet.

The main Research Council items discussed on 2 March were the research and innovation aspects of Europe 2020, the Global Monitoring for the Environment and Security (“GMES”) programme, a Joint Baltic Sea Research and Development Programme (“BONUS”) and the International Thermonuclear Experimental Reactor (“ITER”) nuclear fusion research project.

The Commission advised that research and innovation would be a central theme for the new Europe 2020 strategy. The UK said that the framework conditions for investment in research and innovation (R&I) should be improved and suggested using the European Investment Fund to raise a further EUR3 billion from the private sector for venture capital. The UK also called for a greater proportion of the EU budget to be spent on these activities. The Commission said a detailed EU research and innovation plan would be launched in autumn 2010 which would focus on tackling “grand challenges” such as climate change, energy, food security, health and an ageing population.

At the discussion of GMES, the Commission stressed that it would have a prominent role within a new European space policy, the requirement for an effective governance structure and the need to identify further funding. A progress report was given on BONUS, with the Commission saying it would be a pilot initiative for research initiatives in other European marine regions.

The Commission also gave an update on ITER, saying it was vital that the project was delivered at a reasonable cost and within acceptable levels of risk. The Commission said that a range of funding options for ITER would be put to the Council working group prior to further discussion at the May Competitiveness Council. The Research Council also adopted conclusions on the European Research Council and on European researchers mobility and careers.

I propose to deliver my Budget statement to the House on Wednesday 24 March.

The 2010 report of the Armed Forces’ Pay Review Body (AFPRB) has now been published. I wish to express my thanks to the Chairman and members of the Review Body for their report. I am pleased to confirm that the AFPRB’s recommendations are to be accepted in full, with implementation effective from 1 April 2010.

In line with the AFPRB recommendations, the basic military salary for officers up to brigadier and equivalents in the other services, and all other ranks, will increase by two per cent. In addition, the rates of specialist pay (including flying pay, submarine pay and diving pay) will also increase by 2 per cent. The Government have also accepted the AFPRB recommendations on a number of targeted measures, including the introduction of financial retention incentives to retain personnel essential to delivering key operational capability and a widening of the eligibility for longer separation allowance. The AFPRB has also recommended that unpleasant living allowance be extended to cover service personnel in forward operating bases and patrol bases in Afghanistan.

Copies of the Armed Forces’ Pay Review Body report are available in the Vote Office and the Library of the House.

I am pleased to lay before Parliament today the Service Complaints Commissioner’s second annual report on the fairness, effectiveness and efficiency of the service complaints system.

The independent oversight provided by the Commissioner, and the assurance and scrutiny that gives to the effectiveness of the process, helps to ensure that we can continue to build and maintain the confidence of our personnel in the complaints process.

Ministry of Defence and the services have worked closely with the Commissioner since her first annual report to take practical steps to implement her recommendations for improving the service complaints process. I and the service chiefs welcome the fact that this second report reflects that spirit of co-operation, and that it recognises the initiatives we have taken and the progress we have made in a number of the areas that were highlighted in that first report.

While progress has been made there is still clearly work for us to do.

I will provide a formal response to the Commissioner once I and the services have had time to consider the report in detail.

The Board of the Food Standards Agency (FSA) has decided to dissolve the executive agency status of the Meat Hygiene Service (MHS) and to bring its staff and functions into the FSA to form the core of a new FSA Operations Group.

The MHS is an executive agency of the FSA and is responsible for verifying that operators of approved abattoirs, cutting plants and game handling establishments in Great Britain fulfil their responsibilities for the production of safe meat and the protection of animal health and welfare.

All of the FSA’s operational delivery functions, including those of the MHS, will be merged together in a single Operations Group to derive a wide range of benefits, including:

a consistent, strategic view of the enforcement of legislation relating to all Food Business Operators, irrespective of whether enforcement is undertaken by local or central Government;

a structure capable of better strategic delivery against external expectations and drivers—for example recommendations of the 2009 Report of the Public Inquiry into the September 2005 outbreak of E.coli 0157 in South Wales and recommendations of EU Food and Veterinary Office Missions;

a more cohesive understanding of education and enforcement interventions that work in increasing Food Business Operator compliance with food hygiene regulations; and

co-ordinated and consistent support to UK businesses in relation to compliance with official controls and other statutory requirements.

Health and Rural Affairs Ministers in England and Wales have indicated their support for the FSA Board’s decision—Ministers in Scotland noted the decision. In line with the process set out in Cabinet Office guidance, formal approval to dissolution of the executive agency status of the MHS has been granted by the Chief Secretary to the Treasury and the Minister for the Cabinet Office. The MHS will be merged into the FSA on 1 April 2010.

The dissolution of the MHS will not create a risk to public health and animal health and welfare. All existing regulatory functions undertaken by MHS operational staff in approved meat premises will continue to be undertaken by the same staff in the same way post-merger. Creation of the FSA Operations Group will increase the effectiveness of the FSA as a regulator in the longer-term and reduce risk. Savings of approximately £2 million will be generated through the merger.

I am responding on behalf of my right hon. Friend the Prime Minister to the thirty-ninth Report of the Review Body on Doctors’ and Dentists’ Remuneration (DDRB), Cm 7837, which has been laid before Parliament today. I am grateful to the chair and members of the review body for their hard work.

For salaried doctors and dentists the DDRB has divided its recommended pay awards for 2010-11 into three groups:

Consultants—0 per cent.;

Registrar grades, specialty doctors and associate specialists (SAS) grades, salaried general medical practitioners (GMPs) and salaried dentists—1 per cent.; and

Foundation house officers (1 and 2) and their equivalents—1.5 per cent.

In addition, the DDRB recommend that a banding multiplier be introduced for foundation house officer 1 posts that only attract basic pay and that this should be set at 1.05 of basic salary.

The Government do not accept that there is a compelling case for the recommended award of 1.5 per cent. for foundation house officers and their equivalents and in line with its evidence believe that all salaried doctors and dentists below consultant level should receive an award of 1 per cent. The remainder of the DDRB’s pay recommendations for salaried doctors and dentists have been accepted in full by the Government.

For independent contractor general medical practitioners (GMPs), DDRB have recommended an increase in contractual payments to practices of 1.34 per cent. designed to result in no increase to GMPs’ average net income after allowing for movement in their expenses. With regard to general dental practitioners (GDPs), the DDRB has recommended a 1.44 per cent. increase in contract values which the DDRB intend to result in no increase in GDPs’ net income after allowing for movement in expenses.

In making these recommendations the DDRB has indicated that it considers efficiency savings made by GP and dental practices should only be taken into account retrospectively, after the scale of these savings becomes apparent in data showing trends in earnings and expenses. The Government do not consider this approach sustainable at a time when most areas of the public sector are having to achieve efficiency savings in order to sustain jobs and income levels. In view of this, and in line with its evidence to the pay review body, the Government have decided to abate the DDRB’s recommendations for GMPs and GDPs by applying a prospective efficiency assumption of 1 per cent. of contractors’ operational costs. This will have the effect of reducing the proposed uplift in the value of contract payments to 0.8 per cent. for GP practices and 0.9 per cent. for dental practices.

The ninth report of the Prison Service Pay Review Body (PSPRB) (Cm 7802) has been laid before Parliament today. The report makes recommendations on the pay of governing governors and other operational managers, prison officers and related support grades in public sector prisons in England and Wales in 2010. Copies of the report are available on the www.ome.uk .com/review.cfm?body=2. I am grateful to the chairman and members of the review body for their hard work in producing these recommendations.

The recommendations covering the headline award include:

A 1 per cent. consolidated increase to the maximum point of all pay scales for the remit group;

An additional 0.5 per cent. for senior officers (giving a 1.5 per cent. increase in total) to ensure a pay differential which offers a greater incentive for prison officers to seek promotion;

A 1 per cent. uplift to the required hours addition (RHA), where payable, to senior managers D and managers E to G;

Endorsement of proposals to ensure probationers recruited from 1 April 2009 are eligible for their first increment after no more than 15 months;

No changes to the rate of any of the main allowances (e.g. specialist, tornado, payment plus); and

No change to the rates of local pay.

I can confirm that the headline awards recommended by PSPRB will be accepted in full.

The pay review body also recommended, on affordability grounds, that NOMS should not proceed with targeted investment to support pay reform such as the further scale compression. However, after careful consideration we have concluded that the planned targeted investment in pay reforms are both affordable within the current NOMS budget and necessary for achieving long-term efficiency improvements. NOMS will therefore proceed with the measures effective from 1 April 2010.

The sixth report of the Prison Service Pay Review Body (PSPRB) on the pay of prison governors, prison officers, prison auxiliaries, night patrol officers, night custody officers, prisoner custody officers and operational support grades in the Northern Ireland Prison Service has been published today.

My right hon. Friend the Secretary of State for Northern Ireland has accepted the recommendations in full. The basic increase will be implemented with effect from 1 April 2010. The cost of the award will be met from within the existing budget allocation for the service.

Copies of the report have been placed in the Libraries of both Houses.

The 32nd Report of the Review Body on Senior Salaries (SSRB) is being published today. This makes recommendations about the pay of the senior civil service (SCS), senior military personnel, the judiciary and very senior NHS managers. Copies have been laid in the Vote Office and the Library of the House. I am grateful to the chairman and members of the Review Body for their work.

The Government have decided to accept some but not all of its recommendations. It is important in the present economic climate that senior staff in the public sector show leadership in the exercise of pay restraint.

Senior Civil Service

For the SCS, the Government have accepted the recommendation of the Review Body that for 2010-11 there should be no increase in base pay or the non-consolidated performance-related pot.

The Government have not accepted the Review Body’s recommendation that the minimum for SCS pay band 1 should be increased to £61,500.

These tough decisions complement existing measures to reduce the cost of the civil service and protect frontline services, including savings of £500 million over three years from reforms to the civil service compensation scheme; savings of £100 million annually within three years from reducing unnecessary civil service bureaucracy and the cost of the SCS; and Ian Smith’s new review into the scope for further civil service relocations, building on the relocation of more than 20,000 posts since the 2004 Lyons review.

Senior Military Personnel

The Government have accepted the Review Body’s recommendations that there should be no increase in the senior military pay scales for 2010-11 recommended in last year’s report, and that the bottom step of the senior military 2 Star scale should be removed.

Judiciary

The Government have accepted the Review Body’s recommendation that the salaries for the judiciary should remain unchanged.

Very Senior NHS Managers

For very senior NHS managers, the Government have accepted the Review Body’s recommendation that there should be no increase in base pay for those whose current salary is £81,800 or more, and no increase in the non-consolidated pay pot.

The Government have not accepted the Review Body’s specific recommendations that there should be a 2.25 per cent. increase in base pay for those whose total salary is less than £80,000, and that there should be an increase in base pay so that the total salary of those currently paid between £80,000 and £81,799 rises to £81,800.

Ministers

The effect of the Government’s response to the SSRB’s recommendations on SCS pay is that there will be no increase in ministerial pay for 2010-11. All paid Ministers will also waive any increase in their pay as an MP to which they are entitled.

Other Review Body reports for 2010-11

My right hon. Friends the Secretaries of State for Justice, Health and Defence are making statements today on the reports of the Prison Service Pay Body, the Doctors and Dentists Review Body and Armed Forces Pay Review Body in respect of pay for the relevant workforces for 2010-11. The Government’s response to those reports is consistent with the need for senior staff in the public sector to show leadership in the exercise of pay restraint.

Looking ahead, the Government announced in the 2009 pre-Budget report (Cm 7747) that it would seek a 1 per cent. cap on basic pay uplifts across the public sector for 2011-12 and 2012-13, generating savings of £3.4 billion a year by 2012-13.

I also announced in “Putting the Frontline First: Smarter Government” (Cm 7753) a series of fundamental reforms to the scrutiny of senior salaries in the public sector, with new requirements for ministerial approval of salaries in excess of £150,000 and bonuses greater than £50,000; improved disclosure arrangements above these levels; and a review of senior pay across the public sector led by Bill Cockburn, chair of the SSRB.

I wish to inform the House of the publication of a consultants’ report entitled “Assessment of the provision of marine aids to navigation around the United Kingdom and Ireland”, and of a revision to the planned level of light dues rates from 1 April 2010.

On 10 June, I informed the House that the Department for Transport and the Irish Department of Transport had agreed to undertake an independent assessment of aids to navigation around the UK and Ireland. Subsequently, the Department awarded a contract to Atkins, who has now completed the assessment.

The report of the assessment makes over 50 recommendations, many of which will be demanding of the three general lighthouse authorities (GLAs), and the two Governments, or which challenge long-standing assumptions about delivery and charging for the provision of aids to navigation. Key recommendations include:

The creation of a GLA joint strategic board to drive efficiencies;

The use of an annual target reduction calculator (RPI—X%) for GLA running costs; and

The development of a “roadmap” agreed with the Irish Government on the financing of the Commissioners of Irish Lights, setting out an incentivised financial model, which retains the all-Ireland body while allowing its costs within the Republic of Ireland to be covered wholly from Irish sources.

The report also contains recommendations concerning the management of the general lighthouse fund and the charging of light dues.

Many of the recommendations can be implemented quickly. Others will prove challenging and we will need to consult widely on some before deciding how to proceed. Nevertheless I welcome the Atkins report, which offers a blueprint for the provision, management and funding of aids to navigation for many years to come. The report will shortly be posted on the Department’s website and copies will be placed in the Libraries of the House.

Last June, I also announced the first increases in light dues since 1993. They comprised a twofold set of increases, with the changes due to take effect on 1 July 2009 and 1 April 2010, providing payers with more time to prepare for the second rise and price their services accordingly.

The general lighthouse fund that finances the expenditure of the GLAs is now, as a result of careful administration and management, together with better than expected investment income returns over the last year, in a more robust position than was previously forecast. We have also worked closely with the GLAs to identify efficiency savings over and above the 5.6 per cent. reductions I announced last year with further reductions being made in 2010-11, largely in back-office running costs. The Atkins report also makes recommendations to deliver further GLA efficiencies over time. All of these outcomes have reduced anticipated future calls on the general lighthouse fund.

In the light of these factors, and having listened to the views of the GLAs and the Lights Advisory Committee representing shipping industry light dues payers, I have reviewed the level of light dues needed to maintain the fund at a viable level. As a result, I have concluded that we should now implement a smaller increase in light dues levels. I am therefore reducing by 2p the increase in light dues to be paid on and after 1 April so that the rate will stand at 41p per net registered tonne from that time. As previously announced, the tonnage cap will increase to 40,000 net registered tonnes, reflecting the increasing size of vessels that make up the world fleet.

I have chosen this course of action to ensure that the general lighthouse fund remains able to finance the GLAs and ensure the safety of all mariners, while recognising the difficult economic times that the shipping industry continues to experience.

Today I am laying before the House “The Government’s Response to the Speaker’s Conference” (Cm 7824), which sets out the work Government have done to increase diversity of representation in political and public life and responds to 20 of the Speaker’s Conference’s 71 recommendations to Government.

Copies of “The Government’s Response to the Speaker’s Conference” (Cm 7824) are available in the Vote Office, the Printed Paper Office and also on the Government Equalities Office website at: www.equalities.gov.uk.

The Government welcome the landmark report of the Speaker’s Conference and the comprehensive and detailed examination of the political and parliamentary landscape it sets out.

We will continue to act to increase diversity in parliament. Fair representation is not only just, it is necessary for the legitimacy of our democratic institutions. For decisions to be made that meet the needs of all parts of society, the people making them need to bring diverse experiences to bear and be representative of the wider population. Since 1997, women in Parliament have championed flexible working, the extension of childcare and legislation to tackle domestic violence, and forced marriage.

The Equality Bill currently before Parliament contains a number of specific measures to tackle under-representation, for example by extending the time available to political parties to use all-women shortlists to 2030, and increasing the options open to political parties and public bodies to tackle under-representation, for example by reserving places on electoral shortlists for those with a protected characteristic.

The Government welcome and accept the recommendation that political parties should be required to publish diversity data in their candidate selections, which is why we tabled an amendment to the Equality Bill to give it legal effect.

The Government’s response includes commitments to examine progress on women’s representation following the 2010 general election and consider further options if sufficient progress is not made; to find time for a debate in Government time on the implementation of the Speaker’s Conference recommendations; and to consider establishing a democracy diversity fund to support the work of developing talented individuals from under-represented groups.