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House of Commons

Monday 20 December 2010

The House met at half-past Two o'clock


[Mr Speaker in the Chair]

Oral Answers to Questions


The Secretary of State was asked-

Vocational Education

1. Guy Opperman (Hexham) (Con): What recent representations he has received on the objectives of vocational education; and if he will make a statement. [31422]

The Minister for Further Education, Skills and Lifelong Learning (Mr John Hayes): The Secretary of State for Education has asked Professor Alison Wolf to carry out a review of vocational education. I am working closely with her on the development of vocational learning. Professor Wolf's public call for evidence promoted a large number of submissions, and she will report in spring 2011.

Guy Opperman: My head teacher at the Prudhoe community high school makes the point that rural areas such as south Northumberland are at a huge disadvantage given that their transport costs, travel times and poor infrastructure seem to be tailored to an urban model. Will rural areas get a voice in future, and will a member of the ministerial team meet the head teachers from my region in the spring?

Mr Hayes: As I am sure my hon. Friend may have anticipated, I will be delighted to meet him and the representatives of those organisations. We are absolutely clear there should be a vocational pathway that is as rigorous and accessible as the academic route, and it should be available to people in rural areas, which is why I am particularly conscious of transport and other issues that might inhibit that.

Chris Leslie (Nottingham East) (Lab/Co-op): How can we see more young people in vocational education if the Minister is taking the axe to the education maintenance allowances, 4,000 of which were paid to people in my city of Nottingham? When the Education Secretary told The Guardian on 2 March this year that he would not be scrapping EMAs, should they not have taken that statement at face value?

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Mr Hayes: Of course, I know Nottingham very well-rather better, I might say, than the hon. Gentleman. [Interruption.] No, I do not say that in anything other than the kindest possible way. As a result however, I am well aware of some of the issues associated with disadvantage in that city. Might I suggest that the hon. Gentleman read the work of the late Ken Coates, "Poverty: The Forgotten Englishmen", a definitive study of poverty in St Ann's, Nottingham? We will fight to preserve the interests of disadvantaged people, for that is our mission.

Education Maintenance Allowance

3. Shabana Mahmood (Birmingham, Ladywood) (Lab): What assessment he has made of the effect on post-16 participation rates of replacing the education maintenance allowance. [31424]

7. Bridget Phillipson (Houghton and Sunderland South) (Lab): What assessment he has made of the effect on post-16 participation rates of replacing the education maintenance allowance. [31428]

The Secretary of State for Education (Michael Gove): May I take this opportunity to wish you, Mr Speaker, and every Member of the House the compliments of the season and a very happy Christmas? As we all know, Christmas is a season of unexpected largesse when Members will find gifts of all shapes and sizes suddenly descending into their laps from all quarters. In that respect, Mr Speaker, may I also say that I hope you, like every Member, has the chance to enjoy a well-filled stocking this Christmas time? [Interruption.] It is a tradition of this time.

Chris Bryant (Rhondda) (Lab): Behind you!

Michael Gove: Behind me there are many Members who support our position on EMA and they, like me, are committed to making sure that young people participate in education and training until they are 18. Therefore, we will replace EMA with a fund that can more effectively target those young people who actually need the support to enable them to participate in learning.

Shabana Mahmood: My constituency has the highest unemployment rate in the country. In order to reverse that, young people in Birmingham, Ladywood need to stay on post-16, to gain skills and qualifications to enable them to find work. EMA is vital in that. At City college in my constituency, 68% of students receive EMA, and they tell me that scrapping it will have a devastating impact on students in the poorest areas, and put them off staying on. Why are the Government kicking the ladder from under the feet of young people trying to get on?

Michael Gove: I am very grateful to the hon. Lady; she makes her point with characteristic passion and her question is, typically, well informed. At a time when, as the former Chief Secretary to the Treasury said, "There is no money left", we have to ensure that every penny we spend is targeted on those most in need. I am sure that the hon. Lady agrees that it is important that policy is based on evidence, and the evidence suggests that some who are in receipt of EMA would continue in education without it. Therefore, we are going to make sure that the
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money we have is targeted more effectively on those who need it most, and more details will become apparent in the new year.

Bridget Phillipson: On the issue of evidence, the independent Institute for Fiscal Studies has said that the economic benefits of EMA will outweigh its costs; the money put in delivers results in the long term. Will the Secretary of State ensure that the replacement scheme for EMA is just as cost-effective?

Michael Gove: I am very grateful to the hon. Lady for her question, which is also characteristically well informed. I have great respect for the IFS, and it has previously reported that there is no statistically significant information that EMA has either raised the attainment of young women or increased participation rates among young men. We will ensure, however, that the replacement is sufficiently well targeted to ensure that it provides value for money. I must stress that it is in everyone's interests that more young people stay on in education for longer.

Paul Maynard (Blackpool North and Cleveleys) (Con): Does the Secretary of State agree that where discretionary spending to help students participate in full-time education is available, it should be focused on specific barriers that they face, rather than be a one-off, tokenistic payment that might not actually meet the needs of, for instance, many disabled students for whom participating in education will cost far more than £30 a week?

Michael Gove: I am very grateful to my hon. Friend for making that point, and I thought it uncharacteristically discourteous of Labour Members not to listen to him in silence. As the only Member of this House to have attended a special school, he speaks with a degree of authority that Labour Members would do well to pay attention to. He makes the point crystal clear: we need to ensure that there is sufficient discretionary support for students who are living with handicaps and who have suffered from disability. I am only sorry that Labour Members saw fit to greet his comments with the sort of grumbling and mumbling more appropriate to a student union than the mother of Parliaments.

Margot James (Stourbridge) (Con): I agree with the Secretary of State that the money paid as part of EMA should be much better targeted. The current arrangements for the learner support fund exclude payments for travel, so can he assure me that travel costs will be considered a legitimate part of the future discretionary learner support fund?

Michael Gove: My hon. Friend makes a very good point, describing one of the reasons for reviewing the travel entitlement for all students and learners. We want to make sure that any support we provide is to overcome barriers, which include travel to work costs, as well as paying for rent, subsistence or the supply of textbooks and other materials that are needed. It was striking that during the Labour leadership election the right hon. Member for Leigh (Andy Burnham) said that he would be happy to see EMA go if it were replaced by an allowance for travel, so there is a consensus that the current system is capable of reform. It is one that unites the two Front-Bench teams, even if it does not embrace everyone in the House.

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Andy Burnham (Leigh) (Lab): I start by reciprocating on behalf of the Opposition Front-Bench team the good wishes of Government Front Benchers, including the Secretary of State. We are grateful for the gift that he has delivered to us today, although I cannot promise that the good will is going to last for this entire Question Time.

I would like to treat the House to the full quotation referred to by my hon. Friend the Member for Nottingham East (Chris Leslie) a moment ago:

Will the Secretary of State today apologise to the 600,000 young people who receive EMA and who took him at his word?

Michael Gove: I am grateful for the generous seasonal words offered by the right hon. Gentleman, but when it comes to apologies, it is those of us on the Government Benches who are waiting for an apology from him and from all his colleagues who were in government. When he says that we should spend money on this, that or the next thing, one thing is never acknowledged: his and his colleagues' responsibility for the dire economic mess in which we were left. As a result of forming the coalition Government, two parties are working together to get us out of the mess that his party left us in. May I suggest that he gives us all a Christmas present: a single act of contrition? He should give us a single word for the economic mess that he created: sorry.

Andy Burnham: When we hear bluster like that, we see a pattern repeating itself. It is school sport all over again: a bad decision with dodgy statistics to justify it. Let us take the Secretary of State's only argument against EMA head on: the 90% deadweight. On the Government's own figures, because of EMA 76,000 young people stay on who might otherwise have become NEETs-those not in education, employment or training. Research for the Audit Commission puts the annual cost of a young person not in education, employment or training at £55,000, and 76,000 times £55,000 is more than £4 billion. Do these figures not demolish the Government's last remaining argument against EMA and show that the IFS is right to say that EMA more than pays for itself?

Michael Gove: I am grateful for that display of mental arithmetic, which means that Carol Vorderman's place on Countdown can easily be succeeded by the right hon. Gentleman. [Interruption.] It is time to bring it back, if only to provide him with a platform equal to his talents. The truth is that only 12% of young people who are eligible for EMA say that they would not participate without it. We need to ensure that money is better targeted on those who need it most. His Government commissioned the National Foundation for Educational Research to conduct a survey on who was receiving support and who should receive support to stay in learning. That report, commissioned by his Government, pointed out that it would be beneficial better to target financial support at the most vulnerable groups-that was the case made by my hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard). The right hon. Gentleman's own Government's research points out that this money is spent inefficiently. Of course it
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was spent inefficiently under his rule, but this coalition Government will ensure that the money available for 16 to 18-year-olds is targeted at those who need it most, so that those in the poorest circumstances get more.

Andy Burnham: I have seen enough of the right hon. Gentleman in action to know that weak jokes clearly mean he is in trouble. I think we can now safely give him his end-of-year report card. On Building Schools for the Future, school sports and now the education maintenance allowance he has shown poor attention to detail and a failure to do his homework. On the big decisions, things that people care about, he is cavalier-

Mr Speaker: Order. The right hon. Gentleman will resume his seat. This is Question Time. We must have short questions and short answers, so may I ask the right hon. Gentleman to conclude his question?

Andy Burnham: Let me quote briefly from the Secretary of State's White Paper. It states:

Will he make a new year's resolution today to live by the same exacting standards as he expects schools to apply to their teachers?

Michael Gove: I am afraid that that performance fell below even the right hon. Gentleman's flawed standards. The truth is that the shadow Education Secretary needs to learn that, instead of simply providing a draft of an op-ed piece as a question, he needs to come up with policies that will convince people that he has learned the lesson of his Government's defeat. He cannot simply say that the answer to every problem is more money. He cannot simply say, as he said during the leadership election, that he wants

at the same time as that trade union movement is calling for an all-out assault against this Government. He cannot consistently move to the left, opportunistically-

Mr Speaker: Order. The Secretary of State will resume his seat. That response-I use the word response, rather than answer, advisedly-has nothing to do with the subject matter on the Order Paper.

Science and Maths A-levels

4. Dr Thérèse Coffey (Suffolk Coastal) (Con): What plans he has to review the curriculum for science and mathematics A-levels. [31425]

The Minister of State, Department for Education (Mr Nick Gibb): We will ensure that A-levels assess the knowledge that universities demand from candidates. We have asked the regulator, Ofqual, to examine how to ensure that re-sits and modularity are not damaging in-depth study and we are working with it to develop a process for involving universities and learned societies in the design and development of A-levels, which commands wide support. Mathematics and science A-levels will be reviewed through the new arrangements in due course.

Dr Thérèse Coffey: I thank my hon. Friend for that answer. I am sure that he shares my concern that we have slipped down the international competitiveness
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ratings for educational attainment, especially in maths and science. My personal experience of A-levels and my more recent experience of speaking to examiners show that the number of topics that students have to cover to get exactly the same A-level has contracted. That is a worrying trend; will my hon. Friend look into it with Ofqual?

Mr Gibb: My hon. Friend is right to raise those concerns. That is why it is so important to involve universities and learned societies in A-level development and to ensure that qualifications in this country are on a par with those in the highest performing jurisdictions in the world. That is why we have asked Ofqual to review the impact of the recent changes to A-levels, to which my hon. Friend referred. We are talking to universities about how we can ensure their effective involvement in determining the knowledge and aptitude expected in A-levels, not only in science subjects and maths but in other academic subjects, too.

Tristram Hunt (Stoke-on-Trent Central) (Lab): We welcome the review of the science and maths curriculum, but why are this Government so obsessed with science, technology, engineering and maths-the STEM subjects? Will this Government's war on the humanities in the universities not affect the balance of teaching in our schools? Why are this Government quite so philistine?

Mr Gibb: I think that that is an unnecessary comment. We have made it very clear-my right hon. Friend the Secretary of State is on record countless times talking about the importance of history, and I have talked about the importance of geography. The international baccalaureate, which we have introduced, sets out a key minimum that we expect schools to teach: English, maths, a modern foreign language and history or geography as a humanity. That demonstrates the importance that we attach not only to STEM subjects but to the humanities.

Esther McVey (Wirral West) (Con): The Institution of Mechanical Engineers has produced a report noting that broad choices about STEM subjects are taken between the ages of 11 and 14. I agree with looking at A-level science subjects, but should we not concentrate particularly on helping younger children progress into science and maths?

Mr Gibb: My hon. Friend is absolutely right and it is disappointing that too few young people study the three separate sciences-biology, chemistry and physics-through to GCSE. That is why we have introduced the concept of an English baccalaureate: to encourage a broad range of academic subjects to be taught and taken up to the age of 16, particularly in maths and the other STEM subjects.

Child Care

5. Phil Wilson (Sedgefield) (Lab): What plans he has to ensure the availability of high-quality, affordable child care in all areas. [31426]

The Minister of State, Department for Education (Sarah Teather): Local authorities have statutory duties to secure sufficient child care for working parents and to assess child care provision in their area. They also
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have a duty to secure 15 hours a week of free nursery education for 38 weeks per year for all three and four-year-olds. Statutory guidance requires local authorities to take into account the quality, flexibility and accessibility of places and the range of provision available to meet the needs of parents.

Phil Wilson: What assessment has the Minister made of the effects of removing the requirement from Sure Start children's centres to provide child care?

Sarah Teather: That has not happened. What has been removed is the requirement to provide full day-care services in the most disadvantaged areas. We have done that because early-years providers have consistently told us that in some areas the demand is not there. When that happens, children's centres find that they have to subsidise child care, or at least empty places, at the expense of providing early-intervention programmes that might have made a real difference for those families. This is simply about providing flexibility. In areas where demand continues, I would expect local authorities to want their children's centres to go on providing that service, but where the demand is not there, it does not make sense to divert money that could be better spent.

Kevin Brennan (Cardiff West) (Lab): The Independent on 5 May quoted the Deputy Prime Minister as saying that

How many Sure Start children's centres does the Minister estimate will close down next year on his and her watch? And I wish her a merry Christmas.

Sarah Teather: I also wish the hon. Gentleman a merry Christmas and a happy new year.

Sure Start children's centres are at the heart of the Government's programme for early years. They are absolutely vital, and that is why we asked the hon. Member for Nottingham North (Mr Allen) to do the work on early intervention that will be coming forward in the new year. It is also why we are considering piloting payment by results-to try to make sure that local authorities have an incentive to do such work. There is a legal duty to ensure that there are sufficient children's centres available, but the hon. Gentleman will be well aware that it is for local authorities to decide. However, I have been very clear with local authorities that we expect them to look at the evidence on early intervention and to make sure that they prioritise it. I think that children's centres are an absolutely vital part of that work.

Education Maintenance Allowance

6. Emma Reynolds (Wolverhampton North East) (Lab): What recent discussions he has had with head teachers, teachers and governors of educational establishments on the implementation of any replacement for education maintenance allowance. [31427]

The Secretary of State for Education (Michael Gove): We are currently working with representatives of schools, colleges and training providers to finalise the arrangements for the enhanced discretionary learner support fund,
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including how the funding will flow from local authorities to institutions and what guidance is required to administer the fund effectively.

Emma Reynolds: I thank the Secretary of State for that answer. Some 4,000 young people in Wolverhampton benefited from the education maintenance allowance last year and, as my right hon. Friend the hon. Member for Leigh (Andy Burnham) and my hon. Friend the Member for Houghton and Sunderland South (Bridget Phillipson) have said, the Institute for Fiscal Studies demonstrates that the EMA is cost-effective. Has there been a cost-benefit analysis of the EMA's replacement and will the loss of productivity of the young people whom the replacement will fail to support be taken into account?

Michael Gove: There was a cost-benefit analysis under the previous Government of the EMA by the NFER-that is enough initials-which pointed out that it would be more beneficial and would cost less to target funds on the learners who are in the most need.

Andrew Bridgen (North West Leicestershire) (Con): This Government are to increase the compulsory age of education to 18, thereby removing the need to incentivise 16 to 18-year-olds to stay in education. Does my right hon. Friend agree that that will increase social mobility if we offer vocational and academic studies?

Michael Gove: Yes, my hon. Friend makes an impeccable point. We are committed to raising the participation age, and we have funded the raising of the participation age. The Opposition have not yet explained how they would pay for the maintenance of the EMA or any of their other spending cuts, but I look forward to hearing from hon. Members in the course of the next half hour how they would pay for their promises.

Mr David Lammy (Tottenham) (Lab): Three thousand, seven hundred and fifty-six young people have lost EMA in Tottenham, and Tottenham now has the highest unemployment in London. In light of that cut, will the Secretary of State tell the House how many apprenticeships he has delivered since May?

Michael Gove: We have secured funding for an additional 75,000 apprenticeships beyond those that the previous Government secured. As a result of that additional investment, we will be making sure that young people have a better chance than they had under the previous Government.

Children's Centres

8. Andrea Leadsom (South Northamptonshire) (Con): What steps his Department is taking to ensure that children's centres meet the needs of new parents. [31429]

The Minister of State, Department for Education (Sarah Teather): The early-intervention grant contains enough money to maintain the network of Sure Start children's centres so that they are accessible to all and supporting families in greatest need. Local services, including outreach, family support and health have a critical role in linking new families to centres that use
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evidenced-based programmes. The Department of Health will shortly provide more detail on its plans to recruit 4,200 extra health visitors to provide increased support to all families.

Andrea Leadsom: Does my hon. Friend agree that the most profound impact on a baby's life is its earliest relationship with its parents or carers, and that the best thing that Sure Start children's centres can do is to provide support for those new parents in forming those relationships that will lead to lifelong mental health?

Sarah Teather: I absolutely agree. That is why the Government are committed to recruiting so many new health visitors. It is also why we have doubled the family nurse partnership programme, which particularly supports very young families who are vulnerable and has been shown to have a dramatic impact on child development and that bond between parents and child.

Mr Barry Sheerman (Huddersfield) (Lab/Co-op): Does the hon. Lady agree that cutting the money provided to Sure Start children's centres can hardly be a good idea? Is it not a fact that the budget is shrinking, and that the budget for the new health visitors will come out of that for the children's centres? That means an overall decline in the amount of money.

Sarah Teather: No, that is not true. The early-intervention grant is a substantial, flexible grant that contains more than enough money to maintain the network of Sure Start children's centres. It is a deliberately flexible grant because we want local authorities to think innovatively about the way in which they link services together. I want them to use the assets that are children's centres. I want them to make sure, for example, that they are providing family support in children's centres and perhaps providing services for older children where that is appropriate. The flexible grant, which is larger than that for Sure Start, should allow them to do that.

Damian Hinds (East Hampshire) (Con): How will the work of the right hon. Member for Birkenhead (Mr Field) on the foundation years-improving life chances for disadvantaged children-help to inform my hon. Friend's approach to the early years?

Sarah Teather: The report by the right hon. Member for Birkenhead (Mr Field) is an extremely useful contribution to the debate, especially given his focus on prioritising early years, which supports the work that the Government are already doing to make sure that we are investing particularly in a free entitlement for two-year-olds, which will become statutory by 2013. We are also taking forward the work that he did on life chances indices, which will support the wider work of the Government on child poverty.

Local Government Allocations

10. Natascha Engel (North East Derbyshire) (Lab): What assessment he has made of the effects of local government funding allocations on services provided to schools by local authorities; and if he will make a statement. [31431]

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The Parliamentary Under-Secretary of State for Education (Tim Loughton): Schools have been protected in this spending round. The schools budget has been protected in cash terms, and in addition schools will receive the pupil premium. Funding for local authorities has been reduced, so local authorities will need to prioritise services where they have greatest effect and look at opportunities for delivering services more cost effectively, which will include working with other local authorities.

Natascha Engel: Deincourt school in my constituency was closed on the understanding that its pupils would move to the neighbouring school in Tibshelf, which was waiting for Building Schools for the Future funding to expand. Deincourt students have now arrived at Tibshelf but the BSF money, of course, has not. Tibshelf is now facing the prospect of having its services cut as a result of the local government funding settlement. What has the Minister got against Tibshelf school?

Tim Loughton: I assure the hon. Lady that neither I nor the ministerial team has anything against Tibshelf school. I remind her that Derbyshire has been allocated £91 million of capital funding support for BSF, and to date it has been paid £25 million in conventional funding for BSF, too. If there are special circumstances regarding that school, I am sure that she will make representations to the ministerial team accordingly, and that we will respond.

Mr Peter Bone (Wellingborough) (Con): When Tony Blair came to power, he said that his first three priorities were education, education, education. During the Labour Government, however, standards fell in reading, science and maths. Does the Minister agree that what counts is not the amount of money one puts in, but how it is spent?

Tim Loughton: My hon. Friend makes a very important point, which, although not just about education, is more starkly about education than anything else. Just investing money without focusing it on the quality of the outcomes does not make for a good investment, and this Government see things differently from the previous Government, who purely grandstanded on the amount of taxpayers' money that they could throw at a problem, without taking account of the quality of the outcomes for the students leaving our schools.

Kevin Brennan (Cardiff West) (Lab): It is the end of term, and if the Minister had been a pupil in my A-level economics class I would have to give him a grade E, because, although he shows some understanding of basic economic concepts, he cannot seem to grasp the difference between a real-terms change and a money change in a budget. I will give him the chance to re-sit, however. Now that his Department has admitted that schools will see a real cut in their budgets amounting to 3.4% or £170 per pupil by the end of the spending review period, will he finally admit that there is no real pupil premium, just a pupil con?

Tim Loughton: The hon. Gentleman knows full well that, if his Government had left any money in the kitty, none of those funding assessments would be necessary. The truth is that schools funding, above many other things, has been protected, with an extra £3.6 billion in
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cash terms by the end of the comprehensive spending review period. In addition, pupil premium money will be focused on those pupils most in need-those who were most neglected by his Government.

International League Tables

11. Stephen Phillips (Sleaford and North Hykeham) (Con): What steps his Department is taking to increase the ranking of schools in England in international league tables of educational attainment. [31432]

The Minister of State, Department for Education (Mr Nick Gibb): The OECD's programme for international student assessment-PISA-report, published on 7 December, shows that this country fell from fourth to 16th in science, from seventh to 25th in reading and from eighth to 28th in maths. The lessons from PISA on the hallmarks of high-performing systems are clear, and they are reflected in the direction of policy in our White Paper, "The Importance of Teaching."

Stephen Phillips: I am grateful to my hon. Friend for that answer. According to the OECD report that he mentions, UK teenagers in full-time education were outscored by their peers from, among other countries, Estonia, Liechtenstein and Slovenia. Does he agree that, if the previous Government's watchword was supposed to be education, education, education, the record that they left for this Government and for far too many of our young people was one of failure, failure, failure?

Mr Gibb: My hon. Friend raises a very good point. However one wants to describe the previous Labour Government's record, it is clear that we have fallen in the international educational attainment rankings, and that is why our White Paper focuses on reducing the bureaucracy that confronts our schools. We want to trust professionals and to increase the autonomy of schools. In our White Paper, we have a real focus on behaviour, on raising standards of reading, on raising the quality of the curriculum and on reviewing the national curriculum-should I go on Mr Speaker?-in all the policy areas that we intend to implement over the coming years in order to improve the quality of education in this country and to see a rise in our international rankings.

School Sports Funding

12. Clive Efford (Eltham) (Lab): What discussions he had with Baroness Campbell and the Youth Sport Trust during his review of school sports policy. [31433]

The Secretary of State for Education (Michael Gove): Baroness Campbell and the Youth Sport Trust have been closely involved in developing our proposals to create an Olympic and Paralympic-style school sport competition. The Department for Culture, Media and Sport is leading that work and has held regular meetings with a range of interested bodies, including the Youth Sport Trust. Ministers and officials from this Department attend those meetings. My officials and I have had a range of discussions with Baroness Campbell in the course of developing our wider proposals for school sport, and we are delighted that she, like so many
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others, supports our new approach to school sports, with a new emphasis on encouraging participation in competitive sports.

Clive Efford: This is a very humiliating day for the Secretary of State. He wrote a letter to Baroness Campbell, saying that he would spend the £162 million in funding for school sport through schools, but we now know that he has secured only less than half that money. So, it was his intention to pass on those cuts and make schools responsible for them, not to take responsibility for them himself. If Baroness Campbell is so involved in developing school sport, why did it take 600,000 people to sign a petition before he even met her? Should he not get up at that Dispatch Box and apologise?

Michael Gove: I am very grateful to the hon. Gentleman for his question, but he should do his homework first. I met Baroness Campbell on two occasions before we made our announcement: I enjoyed dinner with her and I enjoyed meeting her when we were launching our school sports Olympics at a school sports partnership in south-east London. I subsequently met Baroness Campbell and many other sports people. I have been meeting more sports people in the course of the past two weeks than I might have anticipated at this time of year, and every one of those conversations has been fruitful and constructive. As a result of those conversations, we have ensured that we are able to strip out the bureaucracy that characterised the worst of the previous Government's legacy and concentrate on building on the best. That is why not just Baroness Campbell but Dame Kelly Holmes has said that our approach to school sport is right. In the spirit of seasonal good cheer, I hope that the rest of the House will get behind those two fantastic, female standard-bearers for sport.

Mr Adrian Sanders (Torbay) (LD): May I say how refreshing it is to have a Government who listen to representations and are prepared to think again? However, will the Secretary of State give the details of any change as soon as possible to people who will be affected? Redundancy processes are already in place, including at a school in my constituency in relation to the roles of development manager, part-time assistant and administrative worker for sports schemes.

Michael Gove: The important point about our scheme is that we are giving schools additional money to support the participation of more children in competitive sports. As the Under-Secretary of State for Education, my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton) pointed out, we are ring-fencing schools spending in cash terms and ensuring that the pupil premium is there to help the most disadvantaged. There will also be additional funding for every secondary school to ensure that it can maintain, if it wishes, its full role in a school sports partnership. However, let me make it clear: that money is for head teachers to spend. We are making sure that the bureaucracy that tied their hands in the past goes.

Mr Dennis Skinner (Bolsover) (Lab): John Barker runs the school sports partnerships in Bolsover and works at Tibshelf school, which has already been mentioned today, in my constituency. If the Secretary of State could, under this new deal, give him a job running the whole Bolsover school sports partnership and provide a
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new school building at Tibshelf as well, he would kill two birds with one stone. The school sports partnership will be happy; the Tibshelf people will be happy; and the 100-year-old school in Tibshelf that is being held up by pit props will be replaced. Can he give that guarantee?

Michael Gove: I have to say that if I leave the House at the end of today having made the hon. Gentleman a happy man, I will consider my political career to have reached its peak. I seriously accept both the case that he makes for capital funding for Tibshelf school, which is in his constituency, not that of the hon. Member for North East Derbyshire (Natascha Engel), and the case for support for the gentleman he mentions. I am sure that the money will be there to ensure that that gentleman can carry on his good work. As the Under-Secretary, my hon. Friend the Member for East Worthing and Shoreham, made clear, capital funding is available for Derbyshire and I will ensure that capital funding is in future targeted on those areas of greatest need. There are few areas of greater need than those that the hon. Gentleman represents, and few are lucky to have such an eloquent advocate.

Toby Perkins (Chesterfield) (Lab): We welcome the Secretary of State's humiliating climbdown on the school sports partnerships. It is hard to know what is most disgraceful: the refusal to meet Baroness Campbell or the way the Government badmouthed the Youth Sport Trust, the hundreds of school sports co-ordinators and the thousands of volunteers. The Secretary of State said that school sports partnerships had failed, another Minister slammed them and even the Prime Minister said they had a terrible record. Now, in the face of a storm of protest, the Government claim to be leaving them in place until shortly after the Olympics, albeit with dramatically less funding. We hope that the Secretary of State learns a lesson from this, which is just the latest shambles he has presided over. Will he acknowledge that school sports partnerships have not failed and have not got a terrible record, and will he promise to back them up to the Olympics and beyond?

Mr Speaker: Order. In future, questions must be briefer, and I know that the Secretary of State will now provide an example of a brief reply.

Michael Gove: I am very grateful for the hon. Gentleman's pre-written question, which was so old that it could have been a primary source in a GCSE history paper and so long that one could have used it instead of the Bayeux tapestry. Anyway, I am very happy to say that the money is now there from the budget that we had already allocated for sport. If only he had been paying attention during the Opposition day debate that we had four weeks ago, he would have known that.

Academies Programme

13. Christopher Pincher (Tamworth) (Con): What recent progress has been made on his Department's academies programme in (a) Tamworth constituency and (b) England. [31434]

The Minister of State, Department for Education (Mr Nick Gibb): Ministers have recently agreed proposals for two new academies to replace four Tamworth schools
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to be taken to the next stage of development, subject to the approval of the governing bodies. In addition, Landau Forte academy in Tamworth opened in September for 11 to 16-year-old pupils, and its new sixth-form centre will open in September 2011. Across England, there are now well over 350 academies, of which 158 have opened during this academic year.

Christopher Pincher: I am grateful to my hon. Friend for that answer. Will he, with me, congratulate all the other secondary schools in Tamworth that are now pursuing academy status beyond the dead hand of the LEA? Will he agree to support, to the best of his ability, those potential academies and academies sponsored by E-ACT that may wish to offer sixth-form provision if there is demand for it in the town?

Mr Gibb: I congratulate Queen Elizabeth's Mercian school, Belgrave high school, Rawlett community sports college and Wilnecote high school on seeking academy status. The OECD research is clear that autonomy at school level, combined with objective external assessment, is the key to success. We are keen to improve the quality of sixth-form provision and to look at all proposals. In the case of Tamworth, that would mean considering this in the light of the new sixth-form centre that is currently being built and due to open next year.

Education in Hospital

14. Dr Daniel Poulter (Central Suffolk and North Ipswich) (Con): What funding his Department provides through local authorities for the education of children with chronic medical conditions who spend significant periods of time in hospital. [31435]

The Minister of State, Department for Education (Sarah Teather): My Department does not collect this information, but we are committed to ensuring that children with long-term illnesses receive as normal an education as possible. Statutory guidance published jointly with the Department of Health sets out the national minimum standards for the education of children who are unable to attend school because of medical needs.

Dr Poulter: I thank the Minister for her reply. I am sure she is aware of the excellent work done by all staff in hospital school rooms in looking after pupils who have long-term illnesses. Will she join me in congratulating Ipswich hospital school room on treating, on average, 2,200 pupils every year who have chronic medical conditions? Does she agree that it is very important that all local education authorities invest properly in these school rooms and ensure that they have permanent staff who can work properly with children who are the most vulnerable and the most sick?

Sarah Teather: I certainly join the hon. Gentleman in congratulating those involved in the example from his constituency. This is an issue to which I feel personally very committed, having spent many of my teenage years in and out of hospital, experiencing not always good educational provision in hospital schools. I am afraid that not everybody is as lucky as the hon. Gentleman's constituents. I am very committed to working on this
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issue with the Department of Health to try to ensure that quality is as good across the country as it has been in his constituency.

Miss Anne Begg (Aberdeen South) (Lab): Of course a child who is off school ill may not necessarily be in hospital, so their education has to take account of that. Will the hon. Lady have a word with her colleagues in the Department for Work and Pensions about this? The way that the benefit system works, particularly regarding disability living allowance, means that many such families are finding it very difficult to provide security to their children so that they can learn, because their mobility allowance or care allowance is stopping and starting as the children move in and out of hospital, and that is causing huge disruption because the family cannot plan and their finances are on a precarious footing.

Sarah Teather: The hon. Lady is correct to say that particularly now, when there is more of a focus on not being in hospital and being treated in the community, children with chronic medical conditions are less likely to be educated in hospital schools. I am sure that my colleagues in the Department for Work and Pensions will take note of her comments, which I will bring to their attention.

School Standards

17. Mel Stride (Central Devon) (Con): What recent representations he has received on school standards in (a) Central Devon constituency and (b) England. [31438]

The Minister of State, Department for Education (Mr Nick Gibb): No representations have been received on school standards in Central Devon. We have, of course, received many representations about standards in schools nationally. In 2010, at key stage 2, 78% of pupils in Central Devon achieved level 4 or above in English and maths combined, compared with 73% in England. In 2009, at key stage 4, 55.5% of pupils in Central Devon achieved five or more GCSEs at grade A* to C, including English and maths, compared with 50.9% in England as a whole.

Mel Stride: I thank my hon. Friend for that answer. Historically, Devon has suffered from a lower dedicated schools grant than other parts of the country. Will he confirm that he is looking closely at per pupil funding, and that schools in my constituency can expect a fairer deal in the future?

Mr Gibb: My hon. Friend will be aware that last Monday we announced the school funding settlement for 2011-12. The overall schools budget is being maintained at a flat cash per pupil rate so that as pupil numbers rise, the overall budget rises. In addition, we are introducing a pupil premium, which will be worth £625 million next year, and will provide schools with £430 for every pupil who is known to be eligible for free school meals. In Devon, the dedicated schools grant is £4,602 per pupil and the capital amount is £24.6 million for 2011-12. We recognise that the school funding system is currently unfair, opaque and illogical. A number of local authorities, particularly those in the F40 group, believe that they are not funded correctly. We will consider that over the longer term to address that unfairness.

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Mr Speaker: Order. I encourage the Minister to address the House. It is no good his looking behind him, because hon. Members cannot hear him.

Local Government Allocations

18. John Cryer (Leyton and Wanstead) (Lab): What assessment he has made of the effect on school budgets of funding allocations to local authority education services for 2011-12. [31439]

The Secretary of State for Education (Michael Gove): The Government recently announced the 2011-12 school funding settlement. Indeed, the Minister of State, my hon. Friend the Member for Bognor Regis and Littlehampton (Mr Gibb), has just been dilating on it. The schools budget will stay at a flat cash per pupil rate, before the addition of the pupil premium. The actual level of budget for each school will vary according to its local authority's funding formula and pupil numbers. There will be a minimum funding guarantee, so that no school will see a reduction, compared to 2010-11, of more than 1.5% per pupil before the pupil premium is applied.

John Cryer: May I return to reality for a couple of minutes? I represent some of the poorest wards in London, and that is against some pretty stiff competition. The schools in those wards face a sharp increase in pupil numbers over many years, in particular over the next year or two. At the same time, funding is being cut, whatever the Secretary of State says. Even taking account of the pupil premium, funding per pupil will reduce. Is that what he had in mind when he drew up his plan?

Michael Gove: I am grateful to the hon. Gentleman, but the truth is that facts are chiels that winna ding. The facts are that we are ensuring that the education budget increases by £3.6 billion.

Kevin Brennan (Cardiff West) (Lab): In real terms?

Michael Gove: That is in real money, actually. It will increase by £3.6 billion over the next four years. The Labour party could guarantee increases in education funding only for two years; we have guaranteed them for four, along with £2.5 billion for the poorest children and £1.1 billion to take account of pupil numbers. We are delivering growth in education spending that Labour could not afford and could not promise. That is a vindication of the progressive goals that the coalition has set itself.

Topical Questions

T1. [31447] Jane Ellison (Battersea) (Con): If he will make a statement on his departmental responsibilities.

The Minister for Further Education, Skills and Lifelong Learning (Mr John Hayes): I am delighted to say that the Government are looking closely at the matters that affect disadvantaged students who attend the college that my hon. Friend represents.

Jane Ellison: The Minister has visited South Thames college in my constituency. Like many further education colleges, it has warmly welcomed the freeing up of colleges from bureaucracy, and the extra freedoms and flexibilities that they have been granted. Such colleges
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would like more information, if the Minister can provide it, on how they might use the enhanced discretionary support fund to support the most disadvantaged young people, particularly those who are starting two-year courses.

Mr Hayes: I was pleased to visit the college with my hon. Friend and I am delighted that it recognises the progress that we are making in giving colleges additional freedom, so that they can innovate and excel. I understand from looking at the figures before today that the college has among its learners a number of disadvantaged students. We will look closely at these matters to ensure that those students get every opportunity to fulfil their potential, for my party is the party of Wilberforce, Shaftesbury and Disraeli, and the elevation of the people is in our hearts.

T2. [31449] Mr William Bain (Glasgow North East) (Lab): On the education maintenance allowance, will the Secretary of State comment on two findings of the Institute for Fiscal Studies? The first is that the A-level results of recipients are, on average, four grades higher on the UCAS tariff than those of people who do not receive EMA. The second is that the so-called dead-weight costs of the EMA are less than those of initiatives that the Government are introducing, such as the relief on employers' national insurance contributions. Does that not show that the Government are making less a policy based on evidence and more a cut based on ideology?

The Secretary of State for Education (Michael Gove): That is a very good question, actually-much better than any of those from the Labour Front Bench. Unfortunately, the evidence does not stack up. The IFS actually pointed out that there had been no increase in participation and only a modest increase in attainment, and the National Foundation for Educational Research pointed out that the dead-weight cost was roughly 88%, so only 12% of students were participating who would not otherwise have participated. Clearly we can have more effective targeting. Just because many policies carry a dead weight, that does not mean that all policies should. Neither, indeed, should all Front Benches carry dead weight.

T3. [31450] Stephen Phillips (Sleaford and North Hykeham) (Con): My right hon. and hon. Friends will be aware of Operation Golf, the Metropolitan police's operation in London that has identified several hundred trafficked children on the streets of the capital, mostly from eastern Europe. What consideration have they given to ensuring that those children receive a decent education while they remain in the United Kingdom?

The Parliamentary Under-Secretary of State for Education (Tim Loughton): My hon. Friend makes a very good point, and I recently had a meeting with the Under-Secretary of State for the Home Department, my hon. Friend the Member for Old Bexley and Sidcup (James Brokenshire), who takes the lead on trafficking. We want to ensure not only that those children are picked up at the border whenever possible and that we can track their whereabouts in this country, but that when we do know their whereabouts we work with local education authorities to ensure that they get the education to which they are entitled and
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which they desperately need. We must help them to shake off the people who have trafficked them, in many cases under the most gruesome circumstances.

T5. [31452] Liz Kendall (Leicester West) (Lab): Can the Minister confirm that the budget for the new early intervention grant, which includes funding for Sure Start, will be almost 11% lower next year than the current funding for the various programmes, and 7.5% lower in 2012? Can she tell the House by what definition of flexibility that is not a cut?

The Minister of State, Department for Education (Sarah Teather): The hon. Lady will be aware, especially if she has listened to the answers to previous questions, that when her party was in government it unfortunately spent all the money. We simply cannot fund everything at the same level as before; otherwise we will never be able to tackle the deficit.

By producing a flexible grant, we are responding to what local government has asked us to do. It has asked us, especially at a time when money is difficult, to create one large, flexible budget to ensure that it can prioritise based on local need. That means it will be able to fund things in a different way. If we tell local government that it has to fund things in one exact way, with certain priorities and in a certain order, it has no flexibility to focus on local areas. A flexible grant will allow it to prioritise funds and change the way in which it provides services locally.

T4. [31451] Margot James (Stourbridge) (Con): I am currently representing two families in my constituency who have been unable to get their children into a primary school along with their older siblings, owing to infant class size legislation. That has caused considerable distress to the families involved. Will my hon. Friend review the impact that infant class size legislation is having on families who wish their children to attend the same primary school?

The Minister of State, Department for Education (Mr Nick Gibb): As my hon. Friend knows, the School Standards and Framework Act 1998 places a duty on local authorities and schools to limit the size of infant classes taught by one teacher to 30 pupils. It makes exceptions for exceptional circumstances, such as when a child moves into an area outside the normal admissions round and there is no other school within a reasonable distance. Under current legislation, however, siblings are not included in the list of permitted exception criteria. We announced in the White Paper a review of the school admissions framework so that it will be clearer for parents, and that review will consider the over-subscription criteria, including siblings and the important issue of twins and children from multiple births. In other words, yes.

T7. [31454] Julie Hilling (Bolton West) (Lab): Young people may be forgiven for thinking that the Government do not like them very much following their decisions on EMA, tuition fees and the future jobs fund, and the destruction of the youth service. Can we assume that they have abandoned "Aiming High for Young People", the 10-year strategy for positive activities? As many local authorities are not
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now fulfilling their statutory duties under the Education Act 2005, will the Secretary of State intervene?

Michael Gove: Another beautifully read question. I can tell the hon. Lady which Government betrayed young people-the one whom she supported, who left young people with a huge burden of debt around their necks and record levels of youth unemployment. A higher number of young people were not in education, employment or training when they left office compared with what they inherited. She has a right cheek to ask a question like that at this time of year. The first thing she should do is apologise on behalf of the previous Government for the dreadful mess in which they left the economy.

Bob Russell (Colchester) (LD): I endorse the point made by my hon. Friend the Member for Torbay (Mr Sanders). The Government have listened and responded on school sports partnerships. I urge the Secretary of State to ensure that the system is put right as quickly as possible so that staff do not lose their jobs. May I draw his attention to a Westminster Hall debate last week and an excellent suggestion from me on how the rest of it could be funded?

Michael Gove: I have always benefited not just from listening to the hon. Gentleman, but from reading his speeches in Hansard. I am thinking of having them bound and giving them as Christmas gifts to many of my friends. On this occasion, I will read with particular attention his contribution to that debate, which I am sure will make us all happier in the new year.

Vernon Coaker (Gedling) (Lab): Will the Secretary of State or one of his ministerial colleagues agree to meet me to discuss Nottinghamshire county council's proposed closure of Gedling school in my constituency? It is a well supported school and there has been a big campaign against its closure, but despite that, the county council is to continue with its proposals.

Michael Gove: The hon. Gentleman was a distinguished schools Minister. I should be delighted to meet him at the earliest opportunity.

Miss Anne McIntosh (Thirsk and Malton) (Con): The Secretary of State will be aware that North Yorkshire is the most rural and largest county in the country. We have problems with school transport, even outside the current extreme weather conditions. Will he give an undertaking that the pupil premium will apply first and foremost to rural counties such as North Yorkshire, and not inner-city schools?

Michael Gove: The pupil premium will apply equally across the country, and we will ensure that the disadvantaged children in North Yorkshire who deserve it will receive it on the same basis as every other disadvantaged child.

Mrs Mary Glindon (North Tyneside) (Lab): Since October, I have been requesting that the Secretary of State visit two schools in my constituency, but as yet I have had no reply. As he will be in North Tyneside on 3 February, will he commit to visit Longbenton and Seaton Burn community colleges?

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Michael Gove: I always enjoy visiting the north-east. I particularly enjoyed my visit a couple of weeks ago, when I had the chance to visit the Duchess high school, Alnwick, and schools in Stanley and Consett. I already have a packed schedule for the day to which the hon. Lady refers-I am due to be in Newcastle and Stockton-but I hope that I can visit North Tyneside, because I also want to visit south Tyneside to congratulate a school in Whitburn that has opted to become an academy. I have to remind the House that the number of schools that have opted to become academies under this Government has dramatically increased. Ninety-four schools have converted, 40 more will convert in January, and 333 have applied to convert, including 64 in the last week alone. [ Interruption.] That is a record of reform of which the hon. Member for Rhondda (Chris Bryant) can, I am afraid, only dream.

Fiona Bruce (Congleton) (Con): There is considerable concern among many parents that elements of the current sex and relationships education contribute to the early sexualisation of children. What can the Secretary of State do to reassure the House that parents and governors will have significant local input into the framework for sex and relationships education in the curriculum review, so that they can know what is being taught in their local schools?

Michael Gove: I am very grateful to my hon. Friend for raising that issue. There is a recognition across the House that we need to strike a sensitive balance between the need to protect the innocence of young people and the need to equip them for the modern world. To my mind, that means that sex education needs to be both inclusive and rigorous, and ultimately subject to parental veto. Parents must have the right to withdraw their children from sex education if they consider it inappropriate, and a right to be informed on a local basis how that curriculum is generated. It is right that sex education is a compulsory part of the national curriculum. My Department wants to look at the guidance it provides, in consultation not just with faith groups but with other organisations such as Stonewall, to ensure that the correct balance between inclusivity, tolerance and respect for innocence is maintained.

Grahame M. Morris (Easington) (Lab): In September, I raised concerns on behalf of my constituents about Seaham school of technology, and the Secretary of State kindly wrote back indicating the criteria that would be applied to replace schools cancelled under the Building Schools for the Future programme-notably those in the worst state of dilapidation and where there are pressures on schools rolls. May I remind him that Seaham school of technology is in a serious state and is the only school serving a population of about 26,000 in the town of Seaham? He indicated in his letter that he would try to respond by the end of the calendar year, and I am now looking for that response.

Michael Gove: That is a fair constituency case. As I pointed out in reply to an earlier question, I am interested in supporting schools in County Durham and the north-east that have faced difficult circumstances, and I have had the chance to see schools in Consett and Stanley that are also in a bad way and need support. They have embraced academy solutions, and if the hon. Gentleman
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wishes to explore such a solution for Seaham, I would be delighted to explore that. In any case, I will look closely at the situation he described to see what can be done.

Jeremy Lefroy (Stafford) (Con): The 2009 OECD assessment of UK schools referred to earlier concluded that 77% of the differences between schools in student performance is explained by differences in socio-economic backgrounds-only Luxembourg has a higher figure. What assessment has the Minister made of that, and what will the Government do to address the situation?

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Mr Gibb: It is still too often the case that a child's background will determine educational outcome and opportunities in life, which is something that the coalition Government are determined to tackle. That is why we have introduced a pupil premium starting at £430 per child qualifying for free school meals, rising to a total of £2.5 billion by 2014-15, and it is why we are focusing on raising standards of behaviour in schools and supporting teachers and head teachers to take a zero-tolerance approach to poor behaviour. It is also why we are putting such an emphasis on children learning to read and using systematic synthetic phonics.

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Temporary Immigration Cap

3.32 pm

Ed Balls (Morley and Outwood) (Lab/Co-op) (Urgent Question): To ask the Secretary of State for the Home Department if she will make a statement on Friday's High Court decision on the temporary immigration cap.

The Minister for Immigration (Damian Green): In June, when the Government announced that we would consult on how to implement a permanent limit on economic migrants, we also said that we would impose an interim limit until the permanent one took effect. This was to avoid a surge of applications in anticipation of the permanent limit.

The interim limit was given effect through changes to the immigration rules that were laid before Parliament, and on which an oral statement was made. On Friday we received the judgement that the changes announced provide an insufficient legal basis for the operation of the interim limit. The judgment was based on a technical procedural point known as Pankina grounds. The Court decided that this meant that more detail about the manner in which the limit is set, including its level, should have been included in the immigration rule changes laid before Parliament.

I would like to make it clear that the judgment of the Court was concerned solely with the technicalities of how the interim limits were introduced. It was in no way critical of, or prejudicial to, the Government's policy of applying a limit to economic migration to the United Kingdom, either permanently or on an interim basis. The policy objective of a limit in migration has not been called into question, and I am now considering what steps are required to reapply an interim limit consistent with the findings of the Court. Tomorrow I will be laying changes to the immigration rules that will set out the details that the Court required. This will enable us to reinstate the interim limits on a clear legal basis.

The House will be interested to know that tomorrow I will also be laying changes to the rules to close applications under the tier 1 general route from outside the United Kingdom immediately, as the original level specified on this tier has been reached. I can reassure the House that the policy of using these limits as part of our overall policy of reducing net migration is unchanged.

Ed Balls: On 28 June the Home Secretary herself came to the House to announce, without consultation, an immediate and temporary cap on non-EU migration. Details of the cap were then posted on the Home Office website, but not presented to Parliament. On Friday the High Court ruled that the Home Secretary's actions were, in fact, illegal. Lord Justice Sullivan said:

the Home Secretary-

As a result, the Government's much-heralded cap-deeply unpopular with business-does not today exist. As Lord Justice Sullivan said,

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In the light of this chaos, it is surprising that the Home Secretary has not chosen to come to the House to answer for her actions, so let me ask the Minister for Immigration two sets of questions.

First, on the consequences of the error, can the Minister tell the House what the status is of those who applied under the illegal cap but were rejected? Will their applications now be granted retrospectively? Can the Minister tell the House how many more migrants he expects to enter the UK because of the failure to implement the cap? In the light of that, is it still the Government's target to cut net migration to the tens of thousands by 2015, as the Prime Minister pledged before the election, or is this mistake one reason why the Home Secretary is trying to water the target down to just an "aim"?

Secondly, on how we got into this mess in the first place, did the Minister and the Home Secretary ask for and receive legal advice before the summer about the legality of the temporary cap and the rushed way in which they were introducing it? Is it correct that he and the Home Secretary were warned by officials and lawyers that there was a risk of legal challenge if Parliament was bypassed in that way? If he and the Home Secretary did disregard legal advice, did they have the support of senior Home Office officials in so doing? Finally, will the Minister now agree to lay before Parliament all the legal advice on which the decision to proceed was based, to dispel the impression that he and the Home Secretary have acted in a reckless and chaotic manner, and to show that she has nothing to hide?

Damian Green: There were, I think, one or two substantive questions in the midst of that bluster. On the right hon. Gentleman's first point, about why the Home Secretary is not here, it seems perfectly reasonable that if a question is asked about immigration, the Immigration Minister should answer it. He will also be aware that there is a serious counter-terror operation going on today. I would suggest that he and other Opposition Front Benchers who are attempting to bluster their way through this should recognise that fact.

The right hon. Gentleman asked a substantive question about the status of those who applied, but whose applications were not granted. The answer is that, as he is aware, the judgment was handed down on Friday; however, as he does not seem to be aware, the written judgment will not be available until January. Until the Home Office receives that written judgment, it is obviously impossible for us to decide whether to appeal against Friday's judgment. All the questions that he asked about that are, therefore, simply inoperative until we see the written judgment. I am happy to confirm that, as the Home Secretary has said, it is still our target to bring immigration down from its uncontrolled, unsustainable level under the previous Government. As for the idea of publishing all legal advice given to Ministers, the right hon. Gentleman will be aware that this is a not a practice that was ever followed by the Government of whom he was a member. [ Interruption. ]

In response to the right hon. Gentleman's sedentary heckling, I am happy to assure him that the announcement that the Home Secretary made on 28 June was changed as a result of the Pankina judgment, but clearly all legal judgments are open to interpretation. What I will set out in a written statement tomorrow will absolutely
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clear up the legal issues and address the narrow technical points made by the judge, and will mean that the interim limits can proceed on a completely legal basis. I hope that the House is reassured by that.

Tom Brake (Carshalton and Wallington) (LD): What is very clear is that the policy is not being challenged. Has the Minister had any discussions with other Departments, such as the Cabinet Office, about what lessons can be learned about how the process has to be followed, and what consultation needs to be carried out?

Damian Green: That is a perfectly valid question. We are in constant discussions with the Cabinet Office. There are, as the hon. Gentleman is aware, many court cases involving immigration issues. The lesson that I draw from this is that more and more should be put in the immigration rules and not simply in the guidance notes. We have already started to adopt that as a policy, and will do so in the future.

Mr Frank Field (Birkenhead) (Lab): May I assure the Immigration Minister that, whatever the courts decide, there is huge support in the country, including in Labour constituencies, for the policy that the coalition Government are pursuing? Of course, if he were able to bring those measures within the law that would be an advantage, but voters want to see the numbers coming down.

Damian Green: I am grateful to the right hon. Gentleman for that question. He shows a wisdom on this issue that is not available to the shadow Home Secretary, and he is right about what the public are asking-in Conservative, Liberal Democrat and Labour constituencies-about our policy of introducing a limit. The shadow Home Secretary has said:

and I have to say that they are still not good enough.

Jason McCartney (Colne Valley) (Con): How does the Minister think the voters of Oldham East and Saddleworth, which borders my constituency, will react when they hear that the shadow Home Secretary opposes limiting economic migration?

Damian Green: I imagine that the voters of Oldham East and Saddleworth-who have great knowledge of immigration, owing to the unfortunate activities of my predecessor in this job-will take the view that the Labour party is, as ever, attempting to mislead them completely on immigration, and that that is why it should not be trusted.

Luciana Berger (Liverpool, Wavertree) (Lab/Co-op): Can the Minister please answer the question that my right hon. Friend the shadow Secretary of State asked him earlier? What is the status of those who applied under the illegal cap and were rejected, and will their applications now be granted? I draw to his attention the example of the international scientist who was unable to come to this country to take part in a cancer research project.

Damian Green: I am sorry that the hon. Lady did not listen to the answer that I gave the shadow Home Secretary, but I am quite happy to repeat it. The judgment
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was given on Friday but we do not have the written judgment yet, and we will not get it until January. It is clearly absurd to ask us to decide what to do about individual applications in advance of deciding whether to appeal against the judgment, and we cannot do that until we have the judgment in writing.

Tracey Crouch (Chatham and Aylesford) (Con): Does the Minister agree that it is a bit rich for the shadow Home Secretary to talk about chaos, given the parlous state of the immigration system that the new Government inherited?

Damian Green: My hon. Friend makes a perfectly good and valid point. The reason why we needed the interim limit was that we inherited an immigration system that was in complete chaos. We said at the election that we were going to introduce a permanent limit that would come into force next April. Between that point and next April there would have been an unimaginably large surge in applications if we had not imposed an interim limit. It is a perfectly sensible policy, and we will take steps tomorrow to ensure that it meets the Court's requirements so that it can continue to do the essential job of bringing immigration numbers back down to a level with which this country can feel comfortable.

Keith Vaz (Leicester East) (Lab): The Minister will know that, in paragraph 110 of the Home Affairs Select Committee's report on the immigration cap, we warned that this might happen. It is not just this Government but successive Governments who have legislated on immigration without giving Parliament the opportunity to scrutinise what was happening. Can he give the House an assurance that the consultation that he is now undertaking on students and on the permanent cap will not be affected in any way by the judgment? Clearly, if there are lessons to be learned from the judgment, when he gets it, it will be important to extend that consultation period.

Damian Green: I absolutely can give the right hon. Gentleman that guarantee. I was grateful for the Select Committee's report; as ever, it was extremely thoughtful and useful. The judgment has no effect at all on the permanent limit, and the lessons will certainly be learned. As he will have seen, our consultation on the permanent cap was a genuine consultation, and the policy that we announced at the end of it was welcomed by many business groups, including the CBI and the British Chambers of Commerce, that had expressed worries about it in advance. That shows that this Government's consultations are genuine, that we listen to people and to Parliament, and that we change policies in sensible ways after those consultations.

Nick de Bois (Enfield North) (Con): For the benefit of my constituents, will the Minister make clear beyond any shadow of doubt that the ruling, which is simply about process, will not deter the Government from their aim of reducing net migration from hundreds of thousands to tens of thousands?

Damian Green: I am happy to give my hon. Friend that complete assurance. As I said, the ruling is technical. We want to obey it as fast as possible, which is why we will change the rules tomorrow. I think that the only
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people in the House who do not want a reduction in immigration and a sustainable immigration system are those on the Opposition Front Bench.

Mike Gapes (Ilford South) (Lab/Co-op): Can the Minister confirm that this is not the first occasion on which Ministers have had difficulties with the courts? Can he also confirm that Ministers in his Department-he and the Home Secretary-received clear and unambiguous legal advice from their officials before they introduced this temporary measure?

Damian Green: Ministers in all Governments receive clear legal advice before any measure is introduced. The hon. Gentleman has been around for long enough to know that all Home Office Ministers have had issues with the courts. Indeed, that was happening even before he and I entered the House. I should love to stand here and say that it will never happen again, but I have been around for too long to say that.

Andrew Stephenson (Pendle) (Con): Does the Minister agree with the shadow Home Secretary that Labour's arguments on immigration during the general election campaign were not good enough?

Damian Green: I do agree with the shadow Home Secretary on that point. He has said many interesting things about immigration-facing both sides of the issue, as he frequently does. However, I think that the country has decided. People want immigration limits, they want immigration brought down, and they elected this Government to do precisely that.

Jeremy Corbyn (Islington North) (Lab): As the Minister appears to be under some pressure from employers in the private sector and the academic and research institutions with regard to the operation of the cap, is it such a good idea to reimpose a temporary cap tomorrow, rather than letting the consultation run its course and then coming up with a more thoughtful answer early next year?

Damian Green: I think that the hon. Gentleman is, perhaps understandably, confused about the nature of the consultation. The consultation was on the permanent limit. That consultation is now over, and my right hon. Friend the Home Secretary made a statement a few weeks ago which was, indeed, welcomed by business groups. We have laid to rest the legitimate concerns that business groups had about the operation of the permanent cap, which will now proceed-as was always intended-from April.

Mr Peter Bone (Wellingborough) (Con): The "Listening to Wellingborough and Rushden" survey has shown that for the last two years immigration has been the No. 1 issue. My constituents would congratulate the coalition Government on what has been their most popular measure, and would urge the Minister to continue the policy.

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Damian Green: I am interested to hear what my hon. Friend's constituents say. They are representative of many people around the country in wanting this issue to be gripped, after 10 years of chaos. I am happy to assure my hon. Friend that that is precisely what we are doing, and precisely what we will continue to do.

Ms Gisela Stuart (Birmingham, Edgbaston) (Lab): Unless I misheard him, which is perfectly possible, the Minister said that tier 1 was being closed with immediate effect because the cap had been reached. Does that include the two-year post-study visa? Will it too be closed immediately?

Damian Green: No. What is being closed is the tier 1 general visa for people from outside the United Kingdom. That was part of the interim cap, and that is what will be closed tomorrow. As the hon. Lady knows, from April we will completely recast tier 1 to make it a tier for exceptional people such as entrepreneurs and investors-the brightest and best people, whom the country needs and from whom we continue to benefit.

Mel Stride (Central Devon) (Con): Would my hon. Friend care to comment on the immigration controls that he inherited from the last Government? Does he know that, according to the shadow Home Secretary, Labour "actually addressed" immigration-that, according to him,

Damian Green rose-

Mr Speaker: Order. As he has helpfully reminded the House, the Minister is very experienced, and I know that he will want to relate his answer to the policy of the Government rather than that of the Opposition.

Damian Green: I shall be happy to do so, Mr. Speaker. The Government's policy is to operate an immigration cap, and to operate an interim cap on the way to a permanent cap as part of a much wider set of measures that will bring immigration down to sustainable levels. The only thing that I can say about the previous Government's policies is that immigration was running at totally unsustainable levels, causing social tension and pressures throughout the country. I am surprised that the shadow Home Secretary did not take the opportunity to apologise for that.

Mr David Lammy (Tottenham) (Lab): Did the Minister consult the Attorney-General? Given that he has said he is going to re-impose the cap, can he now tell us what the status is of those who have applied during the period?

Damian Green: This is the third time I have been asked that question, and I will give the same answer for the third time. Until we get the details of the judgment we do not even know whether we will appeal against it, so until then it is impossible to discuss sensibly the status of those who applied and were turned down between July and now. [Interruption.] As I have said, Labour Members can keep asking that question, but they will keep getting the same, truthful, answer.

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European Council

3.50 pm

The Prime Minister (Mr David Cameron): With permission, Mr Speaker, I should like to make a statement on last week's European Council. Britain had three objectives at this Council: first, to help bring stability to the eurozone, which is in Britain's interests; secondly, to make sure that Britain is not liable for bailing out the eurozone when the new permanent arrangements come into effect; and thirdly, to build on the progress we made with the 2011 EU budget, with tougher settlements in the years to follow.

Let me address each of the three objectives in turn. First, no one should doubt that stability in the eurozone is in our interests. Nearly half our trade is with the eurozone, London is Europe's international financial centre, and no one can deny that the eurozone faces very real challenges at the moment. We see that in the Irish situation, and with Spain and Portugal paying interest rate penalties in the financial markets. Britain's approach should not be simply to say, "Well, we told you monetary union would require fiscal union," and leave it at that. We want to help the eurozone to deal with the issues it faces. We have a clear interest in other member states taking fiscal and structural action and in the cleaning up of banks' balance sheets. The fact that we have set out a path to deal with our own deficit and seen our own interest rates come down lends weight to our argument.

Following the dinner, at which leaders of all the EU countries had a wide-ranging discussion on the state of the eurozone, eurozone leaders issued a statement saying that they

to return the eurozone to stability. Part of that is the new permanent mechanism for assisting eurozone countries that get into financial difficulty. Enabling eurozone countries to establish such a mechanism is in our interests, but how that mechanism is brought about is equally important. After the October Council I made it very clear to the House that any possible future treaty change would not affect the UK, and that I would not agree to it if it did. I also said that no powers would be transferred from Westminster to Brussels. At the Council we agreed the establishment of a permanent mechanism with a proposed very limited treaty change. This change does not affect the UK, and it does not transfer any powers from Britain to the European Union.

Secondly, on the issue of liability for any potential bail-out of the eurozone in future, Britain is not in the euro and we are not going to join the euro, and that is why we should not have any liability for bailing out the eurozone when the new permanent arrangements come into effect in 2013. In the current emergency arrangements established under article 122 of the treaty, we do have such a liability. That was a decision taken by the previous Government, and it is a decision that we disagreed with at the time. We are stuck with it for the duration of the emergency mechanism, but I have been determined to ensure that when the permanent mechanism starts, Britain's liability should end, and that is exactly what we agreed at the European Council.

The Council conclusions state that this will be a "stability mechanism" for

This means it is a mechanism established by eurozone countries for eurozone countries.

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Britain will not be part of it. Crucially, we have also ensured that the current emergency arrangements are closed off when the new mechanism comes into effect in 2013. Both the Council conclusions and the introduction to the decision to change the treaty itself-the actual document that will be presented to this Parliament for its assent-are clear that article 122

and that

Both the Council conclusions and the decision that introduces the treaty change state in black and white the clear and unanimous agreement that from 2013 Britain will not be dragged into bailing out the eurozone. Before the Government agree to this treaty change, Parliament must, of course, give its approval-and if this treaty change is agreed by all member states, its ratification in this country will be subject to the terms of our EU Bill, and so will be subject to primary legislation.

Thirdly, let me turn to the issue of the EU budget. Securing a tight budget for the future remains my highest priority for the European Union. I believe that it is a priority shared by the vast majority of people in this country. At the last Council, we managed to do something that we have not done in previous years. We were faced with a situation where the Council had agreed a 2.91% increase-that was not the UK's position; we had wanted a tougher settlement, but we were outvoted-yet the European Parliament went on and called for a 6% increase. Instead of just splitting the difference between what the Council asked for and what the Parliament called for, which is what happened last year, Britain led an alliance of member states to reject decisively the European Parliament's request. We insisted on no more than the 2.91% increase that the Council had previously agreed. Many predicted that this would be impossible and that Britain would be defeated, but we succeeded, which will save the British taxpayer several hundred million pounds compared with what could have happened.

We also agreed a new principle that from now on, the EU budget must be in line with what we are doing in our own countries. We did this by taking the initiative and galvanising others to join us. We sent a clear message that when we are making cuts at home, with tough decisions on pensions, welfare and pay, it is simply not acceptable to go on spending more and more and more through the European Union. At this Council, I wanted to keep up the momentum on the EU budget by forging an alliance with like-minded partners and starting to work towards securing a tougher settlement for future budgets.

At the weekend Chancellor Merkel, President Sarkozy and I, together with the Prime Ministers of Finland and the Netherlands, sent a letter to the President-[Hon. Members: "That's an alliance?"] Well, it involves the three largest countries in Europe. We sent a letter to the President of the European Commission setting out our goals for the 2012 and 2013 budgets and the longer-term financial perspective, which covers the rest of this decade right up until 2020. It states clearly our collective view that

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in European spending should be "stepped up" in 2012 and 2013. Together, we say that there must be a real-terms freeze in the period 2014 to 2020. I want us to achieve a decade of spending restraint in Europe, and the three biggest powers in Europe-the three biggest net contributors to the budget-have committed to that. I believe that this is an important step forward.

There are two problems that Europe must urgently address. The first is that the eurozone is not working properly. It needs major reform, and it is in our interests not to stand in the way of that. Indeed, as I have argued, we should be actively helping the eurozone to deal with its issues. Secondly, Europe as a whole needs to be much more competitive. Collectively, we must press ahead with measures that will help European countries pay their way in a world where economic competition internationally is becoming ever fiercer. We must expand the single market in areas such as services, press forward on free trade and, crucially, avoid burdening businesses with costly red tape. We must promote stability, jobs and growth. That is the agenda that this Government are pursuing in Europe, and I commend this statement to the House.

Edward Miliband (Doncaster North) (Lab): I thank the Prime Minister for his statement. I want to ask him about three issues: the agreement on the European budget, the treaty change, and the wider but perhaps most fundamental question of all, European growth.

First, on the budget, I welcome the call for restraint in the European budget in the years ahead. On the budget for this year, we heard from the Prime Minister after this Council, in his own modest way, rather what we heard after the previous Council: he applauded the outcome because he said that it avoided the ultimate sin of European negotiations-simply "splitting the difference" between positions. But that rather depends on whose positions we are talking about.

Let me remind the Prime Minister of some rather inconvenient facts. He originally wanted a freeze in the budget, whereas the European Parliament wanted a 5.9% increase. He did not just want a freeze back in August; he was still arguing for one days before the previous European Council in October. Perhaps he can tell the House what figure splits the difference between 0 and 5.9%. By my reckoning it is about 2.9%, which is the outcome we ended up with after his negotiations. So after all his rhetoric, his grandstanding and his description of this as a "victory for common sense", we have ended up splitting the difference. I congratulate him on his heroic achievement.

We welcome the Prime Minister's support for the treaty change agreed at the Council. It is right that the eurozone should replace its ad hoc arrangements with a more permanent mechanism, but we have to ask why the Prime Minister has to fall over himself to try to justify accepting a fairly minor change. He is simply showing-I congratulate him on this-a sensible piece of what might be called "Europragmatism". Of course, his problem is that, before the election, he claimed not to be the Europragmatist but the great Eurosceptic. We all remember his cast-iron guarantee, and his promise that if there was any chance at all of a reopening of the treaty and a referendum on Lisbon he personally would
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make it happen. The Foreign Secretary admitted in November that this treaty change offers a pretext for a referendum, but it would clearly be absurd to use it to try to derail the whole of Lisbon. That is the problem-the Prime Minister's absurd position before the election, and the fact that he was believed.

The Prime Minister also used to say that he would take the first opportunity to repatriate powers over employment and social legislation to Britain, but we heard nothing of that in his statement. It is no wonder that his Back Benchers are not very happy with him on Europe, because he led them up the garden path. He said, "I am one of you. I feel your pain. I am the great Eurosceptic." Can he explain, most of all for the benefit of his Back Benchers, why he has abandoned those pre-election commitments? We know that he has broken his promise to parents on child benefit and to young people on education maintenance allowance, but things have got so bad that he is even breaking his promises to his own Eurosceptics.

Let me turn to the economy. The agreement on a permanent crisis mechanism for the eurozone after 2013 does not address the challenges faced by Europe's economy right now. I think that he and I would agree on that. Does he agree that eurozone members should do more to promote stability in the eurozone before 2013? Does he also agree that we need European action to promote growth for there to be any chance of serious export growth in the United Kingdom? The Prime Minister's plans, with VAT set to rise and spending cuts kicking in, rely on an extra £100 billion of exports to the UK over five years. More than 50% of exports, as he said, are to Europe, but the European Commission forecasts slowing growth next year.

In our view, the Prime Minister should be doing more to work with colleagues in Europe to improve prospects for growth. He should do three things in particular: first, he should argue that all countries engaging in fiscal consolidation, including Germany and the UK, should do so at a pace that supports economic growth domestically and across Europe as a whole; secondly, he should ensure that those countries facing problems, including Ireland, are not locked into repeated rounds of austerity measures, with higher taxes and lower spending hitting the growth those countries need to pay down their debts and recover; and, thirdly, he should ensure that Europe's voice in the G20 argues for a growth-oriented strategy. Given the nature of his statement, people will wonder whether he sees the connection between his optimistic forecast about exports and growth and the summit he attended this weekend.

The Prime Minister's problems on Europe reflect his wider domestic approach. He breaks his promises and thinks one can reduce an economic policy to a pure deficit reduction policy with no focus on growth and jobs. In 2011, he needs to stop spending his time in Europe trying to grandstand and start engaging on a growth agenda for Europe and Britain that can help us here at home.

The Prime Minister: The right hon. Gentleman talks about grandstanding, but for the past couple of years we were told endlessly that we were going to be isolated in Europe, that we would have no allies in Europe and no friends in Europe, but when we put together an
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alliance of the three biggest countries in Europe for budget restraint, the first thing he ought to do is stand up and congratulate us.

Let me take the right hon. Gentleman's three questions in turn. First, on the budget, he talked about some inconvenient facts. Let me give him some inconvenient facts from last year. Last year, when we had a Labour Government, a 3.8% increase was proposed by the European Council and supported by that Government. The European Parliament then came forward with a 9.8% proposed increase, and they split the difference so the budget went up by 6%. That is what happened last year, supported by Labour. The difference between that and what we achieved is hundreds of millions of pounds. That is what this Government's actions have saved. When it comes to changing positions, I note that in her statement after the European Council the shadow Foreign Secretary said that "Labour voted against" this budget rise "from the beginning". That is simply not true-Labour MEPs opposed our call for a freeze in the European Parliament.

Secondly, on treaty change, the right hon. Gentleman does not seem to understand that this very limited treaty change is in our interests so we should support it. We should use this opportunity to get rid of the risks of Britain being drawn further into eurozone support in the future. We are liable to that because of the weak actions of his Government before the last election. It is absolutely right that we use our negotiating capital to make sure that Britain is not liable when the new mechanism comes in. What we are doing, once again, is clearing up the mess left by Labour.

The third issue that the right hon. Gentleman raised was the economy. He says that we should call for measures that will achieve greater stability in Europe, but that is exactly what we are doing. Just imagine what stability we would get in Europe if he were sitting at the Council table saying that we should not be bothering with deficit reduction. We would be putting ourselves in the same camp as Ireland, Portugal and other countries.

Finally, the right hon. Gentleman tells me how unhappy my Back Benchers are, but I would swap their unhappiness for that of his Back Benchers any day of the week. I am sure that they will want to remember that important thing at Christmas time-always keep your receipts in case you want to exchange for something bigger.

Richard Ottaway (Croydon South) (Con): As a happy Back Bencher, I congratulate the Prime Minister on winning the budget battle with the European Parliament, where there was clearly no splitting the difference. Enlargement was also on the agenda. On Turkey, does he agree that the problems that many predicted would have occurred by now do not seem to have materialised? However, we still seem to have deadlock, with no new chapters being opened and no progress being made on the Ankara protocol. The General Affairs and External Relations Council said last week that progress is now expected without further delay: how does he see that materialising?

The Prime Minister: My hon. Friend is right that we should push for progress with Turkish accession-and we are. I raised this with the Hungarian Prime Minister when he came to Downing street last week because Hungary is going to hold the future presidency of the
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European Union. We have to win the argument in Europe-too many are opposed to Turkish membership. I think that all the arguments are in favour and that we should push this as hard as we can and keep opening those chapters to show that we are doing so in good faith.

Mr Denis MacShane (Rotherham) (Lab): Before the Prime Minister boasts so much about freezing the budget, he might reflect on the fact that although that will save the British rebate, it means the common agricultural policy will not be reformed for several years. It also means that there will be no money for our new partners in east Europe. From Margaret Thatcher to Tony Blair, British leadership was based on acts of solidarity with poor, incoming members of the EU. The Prime Minister is the first one to sign up to the Sarkozy-Merkel agenda of being as mean as possible to our new friends and allies in east Europe.

The Prime Minister: I do not accept that the only way we can make progress with helping partners in eastern Europe is by having an ever-rising EU budget. Indeed, there are countries in eastern Europe that support the position we take that the budget should not go up and that we should spend the money better. As I have argued before, we should be making more progress on transparency and using it as a weapon to shine a light on the EU budget and some of the disastrous ways in which it is spent. It is an absolute counsel of despair to say that the only way we can help other countries in Europe is with an ever-rising budget: it is not.

Mark Pritchard (The Wrekin) (Con): Whilst the new bail-out mechanism has thankfully comforted the markets, do not many of our EU partners need to rein in their public spending, follow Britain's example and introduce some meaningful financial austerity measures?

The Prime Minister: To be fair to other countries in Europe, the conversation around the Council table is very much about the action that everyone is having to take. Britain has set quite a pace in setting out a five-year programme about how we are going to do this and what we have seen in Britain is market interest rates coming down since the election, whereas in other European countries they have sometimes gone up. What is required is some credible fiscal plans. Fiscal consolidation alone will not settle down the eurozone but that has to be a part of it.

Kelvin Hopkins (Luton North) (Lab): It is clear that, despite everything the European Union has done, the euro is still in crisis-and that crisis will not end any time soon. Has the Prime Minister been aware of or involved in any private discussions about how the euro might be deconstructed in a controlled way?

The Prime Minister: We had a very good discussion at the dinner, which involved all EU members, not just eurozone members. As someone who has never supported Britain's joining the euro and who has always had concerns that the currency area was not optimal-as I said in my statement, I would make the argument that with a single currency, a move towards a single fiscal policy was needed, but that was never done-I must say it is profoundly not in Britain's interest to see the
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break-up of the eurozone. If that happened, there would be very bad consequences not just for eurozone countries, but for Britain. We should take a hard-headed, practical view and recognise that 44% of our exports go to eurozone countries. If that broke up, it would be bad for Britain. We should be making positive suggestions about what eurozone countries can do to make sure that they get the stability and growth that we all need. There is fiscal consolidation, active monetary policy, cleaning up bank balance sheets, getting ahead of the markets and showing that we want this to be a success. That is what needs to happen and, as I say, standing on the sidelines and saying, "Well, we told you this wasn't a great idea" is not the right approach.

Several hon. Members rose -

Mr Speaker: Order. Although it is not my normal practice to call a Member who was not present at the very start of the statement, I note that the hon. Member for Stone (Mr Cash) chairs the European Scrutiny Committee and therefore, exceptionally, I shall call the hon. Gentleman on this occasion.

Mr William Cash (Stone) (Con): I am extremely grateful, Mr Speaker. I really only came here to wish the Prime Minister a happy Christmas. Does the Prime Minister share the concern of many of us that the present financial mechanism is unlawful, and that Britain is exposed until 2013 while the black hole of Portugal and Spain opens up before us? Does he therefore think there are serious grounds for challenging the unlawfulness of it and not exposing the British electorate to the prospect of having to contribute to that while suffering such severe austerity cuts?

The Prime Minister: I thank you, Mr Speaker, for your leniency. No European statement would be complete without a question from my hon. Friend the Member for Stone (Mr Cash). He may have a good point. Article 122 of the treaty refers to help in the case of natural disasters and other emergencies. There are some people who question whether it should have been used in this way to support eurozone countries.

That argument was had and was conceded under the previous Government in two ways. First, they agreed the establishment of the mechanism. Secondly, if we go back to the Nice treaty, it was the then Europe Minister, the right hon. Member for Leicester East (Keith Vaz), who is in his place, who argued from the Dispatch Box that it was perfectly okay for article 122 to go to qualified majority voting, which is where we are today. So in two ways the previous Government made a bad mistake. As I say, we are clearing up the mess and we will certainly do that from 2013, but the mechanism remains in place till then.

Chris Bryant (Rhondda) (Lab): Was there any discussion at the Council of the case of Sergei Magnitsky, who was working on behalf of a British investment firm in Russia and was tortured and murdered a little over a year ago? I am sure the Prime Minister is aware that there was a vote in the European Parliament last week, supported by MEPs from all parties in this House, to say that those who took part in his murder, who have not faced any criminal prosecution at all, and those
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whose corruption he unveiled should be banned from the European Union, and that Senator McCain in the United States of America is supporting a similar ban. Will he support a ban?

The Prime Minister: The Government continue to raise all these cases and issues around them with the Russian authorities. Our embassy in Moscow is closely watching developments in the cases of Mr Khordorkovsky and Mr Lebedev, and we remain very concerned about Mr Magnitsky's case, as raised by the hon. Gentleman. We await with interest the conclusion of the official investigation into the case, which was announced by President Medvedev in November 2009.

Simon Hughes (Bermondsey and Old Southwark) (LD): I congratulate the Prime Minister on a robust performance in Brussels. Resisting the Parliament's demand for an extravagant budget was absolutely the right thing to do. As he looks ahead towards the justified freeze on the budget post-2014-and not just because of the weather-can he assure us that it does not mean that the budget will be frozen, but that subsidies that are not justified and expenditure that is wasted will be replaced by, for example, expenditure on energy and climate change issues, which are both the priority of this Government and ought to be the priority of the European Union as well?

The Prime Minister: My hon. Friend makes a good point, which goes to the point made by the former Europe Minister, the right hon. Member for Rotherham (Mr MacShane), which is that we must do better at trying to re-order the priorities of the European budget, but I do not accept that we can do that only by allowing an increase. I accept that we are taking a tough position, because we are trying to get a freeze with major partners for 2014 to 2020, but we also want budget reform and reform of the CAP. We are in the vanguard of arguing for that because we want to see the money better spent. It is right to set out down this path and try to achieve those goals.

Keith Vaz (Leicester East) (Lab): The Prime Minister will recall that six months ago he and other EU leaders set out the Europe 2020 strategy as a successor to the Lisbon agenda, which was agreed in 2000. Is he confident that nothing discussed at the weekend will affect the benchmarks that were set in June? With the European Union, what is important is not just getting an agreement, but making sure that countries meet benchmarks on jobs and growth.

The Prime Minister: The right hon. Gentleman makes a good point, which is that we should not amend those benchmarks, but the Europe 2020 document is slightly disappointing, because Europe's real problem is that it has become uncompetitive, has expensive welfare systems and overbearing pension systems and is not complete as a single market. We need a more robust conversation in Europe about how we get growth-how we reform and improve the structure of our economies to get growth. Europe 2020 is only part of that, and we should be more ambitious for next year.

Harriett Baldwin (West Worcestershire) (Con): As another happy Back Bencher, may I convey the thanks of the British taxpayer for the hundreds of millions of
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pounds that the Prime Minister saved us over the weekend? However, I should be interested in the clarification of an issue. The problems in the eurozone are likely to occur between now and 2013. What is the extent of Britain's liability under the emergency arrangements signed up to the previous Labour Chancellor?

The Prime Minister: I am glad to hear that my hon. Friend is a happy Back Bencher. The answer to her question is that a mechanism was established under article 122 of the Lisbon treaty, allowing the European Union to spend the headroom between its budget and the money it can spend under the previous financial deal on such bail-outs. The headroom was €60 billion, some of which has been used with respect to Ireland, and the mechanism is established under qualified majority voting. That is the problem we face, so we are dealing with that in the fastest way we can by saying that, when the new mechanism comes in, it will rule out action under the old mechanism. Of course, as they like to say in Limerick, we shouldn't have started from here.

Mr Dennis Skinner (Bolsover) (Lab): Why is the Prime Minister so besotted with the idea that he wants Turkey in the European Union and, possibly, the eurozone? Eighty million Turks will be on the move, and it will not be two-way traffic. How can that improve financial stability?

The Prime Minister: I know lots of people in Turkey I would willingly swap with the hon. Gentleman. Maybe we could have a transfer. I would make a serious argument, however, which is that, if we want the European Union to be a force for stability in our world, we should try to include a country that wants to look to the west, is a democracy and wants to be part of the European economy. All those would be great advantages for the European Union.

Jacob Rees-Mogg (North East Somerset) (Con): Will the Prime Minister clarify whether the minor treaty amendment will specifically exclude Britain from any liability, or whether that will merely be implied? Will he also ensure that article 122 is never used again for that purpose under the treaty? The reason I ask so specifically is that the previous practice of Europe has not always been to do precisely what it has implied it might do, and we really want to have that nailed down.

The Prime Minister: I think my hon. Friend asks absolutely the right question, because there is a history in Europe of such agreements not always being stuck to, and of there being a rather federalist ratchet. That was why I was very clear that we needed language, not just in the European Council conclusions, about article 122 not being used in future. I actually wanted it in the article that will be presented to this House for us to look at as a treaty amendment, so, in what is called the recitals-don't worry, I'm not going to start singing-or the introduction to the article, it says:

the new mechanism-

the treaty on the functioning of the European Union-

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That seems to me to be quite a good belt and braces-no need, no use; and it is not just in the Council conclusions, but in the introduction to the treaty article itself.

Ms Gisela Stuart (Birmingham, Edgbaston) (Lab): This seems to have been a pretty significant Council, as a result of which we will have treaty changes that will involve legislation here. Treaties cannot be amended, so we will have a debate but not be able to amend them. Is the Prime Minister aware that, for this Council, the House did not have a pre-Council debate in the Chamber, on the basis that the Leader of the House said-and the Foreign Secretary will whisper to the Prime Minister-that it is Back-Bench business? If the Prime Minister takes Europe seriously, how on earth can he defend a discussion on something as significant as that being Back-Bench business?

The Prime Minister: The hon. Lady is so astute about this House she even knows when I am being whispered to while sitting down. I am hugely impressed because she is absolutely right. I answer her in two ways. First, the new Backbench Business Committee-some of its members are in the Chamber-has 30 days a year in which to discuss such matters. Secondly,-this is the important thing-at this Council, we agreed the type of treaty change and gave some clarity about what needs to be done. However, there is now a proper process, which means that this Parliament has to be formally consulted, which it will be, before the treaty change goes through and there will then be a proper process of parliamentary approval. It is all very well the shadow Chief Whip chuntering from the Front Bench, but I do not remember the previous Government being anything like as generous as to give 30 days for the consideration of Back-Bench business. We just dreamed of such things in those days.

Mr Bernard Jenkin (Harwich and North Essex) (Con): May I say that I agree with the hon. Member for Birmingham, Edgbaston (Ms Stuart): it is extraordinary that we did not have a pre-Council debate? I also wish to press my right hon. Friend on the question raised by my hon. Friend the Member for West Worcestershire (Harriett Baldwin). The Prime Minister said that we will not have liability for the eurozone after 2013, and we very much hope that that is correct. However, the European stabilisation mechanism seems to be an open-ended liability. On 22 November, the Chancellor said:

Are we going to refuse to replenish the European stabilisation mechanism while it continues to exist?

The Prime Minister: As I have said, the stabilisation mechanism is based on the difference between the European budget and its headroom. That is a fact set out in the decision made by the right hon. Member for Edinburgh South West (Mr Darling). The debate in Europe at the moment is about replenishing the other facility. That is known as the facility rather than the mechanism, which, of course, Britain is not in. That is a eurozone facility, and there is a debate in Europe about whether that should be topped up and increased. Obviously, from our perspective, we are keen on Europe using the facility rather than the mechanism.

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Mr Andrew Love (Edmonton) (Lab/Co-op): The permanent mechanism will not be introduced until June 2013. Meanwhile, we are left with this temporary mechanism, which is widely viewed as inadequate to the task. That is likely to mean repeated austerity measures on behalf of Spain, Portugal and perhaps others who are caught in this contagion. That cannot be good for the United Kingdom and its export performance. What is the Prime Minister doing to raise our case at a European level?

The Prime Minister: I would make two points to the hon. Gentleman. First, as I have described, there is the mechanism, which has that headroom. However, eurozone countries should be using the eurozone facility. We do not have a say over eurozone member states' financial and fiscal policies, so it makes much more sense for eurozone countries to raise that money and subsidise each other if that is what they choose to do. That is what the eurozone facility, which is hundreds of billions of euros, rather than €60 billion, is there to do. I make one other point to the hon. Gentleman: only a limited amount can be done to help countries just by making these transfers. There must be fundamental reforms in those countries, whether that involves cleaning up banks, dealing with labour markets, having more active monetary policies or making their fiscal policies real. All those things will make a difference.

Neil Carmichael (Stroud) (Con): In noting the Prime Minister's considerable achievements in the European Council, does he agree that it is critical that Britain plays an important role in creating a vibrant, dynamic European economy, so that we can get on with the job of being competitive with the far east and other growing economies?

The Prime Minister: My hon. Friend is entirely right, and this also relates to the previous question. Of course, everyone in Europe wants to see higher growth rates. That is one of the ways we will get deficits down and ensure that we have more jobs in our countries. However, Europe needs to ask itself, "How can we get higher growth?" That should be done by completing the single market, extending it to services, taking a more forward position on the Doha round and, frankly, stopping some of the things that the European Union is currently doing that add massive costs and burdens to business. At the European Council dinner, I pressed the point very strongly that unless Europe starts making those decisions, people will not take its growth strategy very seriously.

Mike Gapes (Ilford South) (Lab/Co-op): The Prime Minister has not referred to one of the most important issues that is currently going on internationally, and I would be grateful to know whether it was considered and discussed in the European Council-that is, the deteriorating situation in west Africa, specifically the fact that the former defeated President of Côte d'Ivoire, with the support of the military and brutal thugs, is clinging on to power and threatening to expel the United Nations from that country. What is the European Union, with its common security and defence policy, going to do to assist the African Union and the UN to restore democratic government in Côte d'Ivoire?

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The Prime Minister: The hon. Gentleman is entirely right. We did discuss at the European Council the problems in Côte d'Ivoire, and we took a very clear view, which is that everyone there should accept the result of the election and support the United Nations, as we support the United Nations and its continued presence in that country.

Jeremy Lefroy (Stafford) (Con): What progress did my right hon. Friend make in persuading other countries in the European Union of the merits of a single market in services, not just for their companies here but for our companies there?

The Prime Minister: This is an argument that we can win and have got to win in Europe. We now have like-minded Governments who want to see completion of the internal market, progress on services and progress on Doha, with countries like the Netherlands, Finland and Germany all wanting to see a more open-market Europe. We have to push this very hard, because it is the growth agenda. Clearly, fiscal stimulus is not available to Europe because everyone has such large budget deficits. The best stimulus that we could give to the European economy and our economy is to make these structural changes.

Kevin Brennan (Cardiff West) (Lab): Do I take it from the Prime Minister's statement and the facility that he has shown in his answers for using Euro-jargon that he has gone native on Europe?

The Prime Minister: I am very sorry-I will do my best. It is extremely difficult when there is a mechanism, a facility, and article 122, which used to be article 100 before it was changed by QMV in the Nice treaty. [ Interruption. ] There is also the recital, and as I said earlier, I am not going to sing. There is a lot of junk that you have to mug up on, but the basic principles are simple-get in there, stand up for your country, and do a good deal.

Joseph Johnson (Orpington) (Con): A structural lack of competitiveness is one of the fundamental problems underlying the current crisis. Can the Prime Minister say whether there was any discussion of the Lisbon 2020 agenda and how it will differ from the original Lisbon agenda in 2000, which failed dismally to make Europe the most competitive and dynamic economy in the world by 2010?

The Prime Minister: We did discuss the 2020 agenda. I think there is a feeling among a number of other Heads of Government that it is all very well-it has some good targets and a lot of sensible things about investing in skills and education and the rest of it-but it does not really do the hard things that we need to do in Europe to make our economies more competitive with those in the far east. That is the agenda that we need now-not just easy-to-agree targets and headlines but the tough things we need to do to make us more competitive.

Mr William Bain (Glasgow North East) (Lab): In opposition, the Prime Minister spoke regularly about the need for radical reform of the common agricultural policy, but there is no reference to it in the statement he
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made today. Can he assure the House that, in pursuit of this alliance with France and Germany over the budget, he is not abandoning the principles of CAP reform that are shared across this House?

The Prime Minister: I can absolutely give the hon. Gentleman that assurance. There has been no back-stairs deal between us and the French. What has happened is that the French and the Germans have agreed with us that, with all the difficult things we are doing in our own countries, it is a real priority to stop the endless rise in the EU budget. That has been done without any guarantees about what happens or does not happen to CAP reform. I remain passionately committed to reforming the CAP. That is right for Europe and for Europe's farmers, and it would leave room in the European budget to spend the money in a more sensible way.

Jason McCartney (Colne Valley) (Con): May I just put it on record that I am a very jolly Back Bencher, particularly as I received the Prime Minister's Christmas card this morning? Along with the vast majority of my constituents, I would very much have welcomed a cut to the EU budget. However, back in the real world, will the Prime Minister confirm that the decisions and arguments he has made in the past few weeks are good for the long-term future of the United Kingdom?

The Prime Minister: I thank my hon. Friend; I am glad that Royal Mail is working effectively. [ Interruption. ] Opposition Members are shouting, "Where are ours?" Any unhappy Back Benchers who do not feel that they are getting enough love from their Front Benchers can join the love train and get a "Happy Christmas" card from me.

Grahame M. Morris (Easington) (Lab): Bankers' bonus payments rankle with ordinary hard-working families. Did the Prime Minister discuss-formally or informally-with his colleagues at the summit making a collective EU agreement to limit bankers' bonus payments?

The Prime Minister: Normally, there are long discussions about banks and bonuses. We had a lot of discussion about the need to improve the performance of banks, their balance sheets and their lending practices, but there was no long discussion about bank bonuses. There have been good international agreements on bank bonuses, and we have added to them in this country through the bank levy, which will raise more in every year than the previous Government's bonus tax raised in just one year.

Mr Julian Brazier (Canterbury) (Con): Does my right hon. Friend agree that what is best for the poorer countries of eastern Europe, which were mentioned earlier, is best for people in this country? That is economic recovery in Europe. Although he rightly says that fiscal changes alone will not deliver that, without fiscal changes and restraint not only by Governments but by the EU, there will be no sustained economic recovery.

The Prime Minister: My hon. Friend is right. Some Labour Members talk as if there were a choice between going for growth and dealing with the deficit. The truth is that the deficit must be dealt with to get the confidence that is needed for growth. If Labour Members sat in the
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European Council and argued that deficits were not a problem, their fellow socialists in Portugal, Spain and Greece, who are in difficult circumstances, would think that they had gone completely and utterly mad.

Jeremy Corbyn (Islington North) (Lab): During the summit, did the Prime Minister talk to Government leaders about the growing levels of unemployment in some European countries, the increasing severity of public spending cuts and the impoverishment of working-class families, which is growing as a result? Did they discuss the danger of the whole of Europe tipping into recession because of the drive to cut public expenditure and lay off public sector workers, whereas the socially just thing to do would be to maintain social levels of expenditure?

The Prime Minister: Yes-of course we had that conversation. We had a conversation about how we can create growth and jobs in Europe. However, if one listens to the left-wing leaders of Portugal, Greece and Spain talk about the problems in their economies, they say that they know that they must deal with their deficits and show that they have a plan to get their deficits down. At the moment, their interest rates are rising higher and higher, making growth more difficult. The idea that there is an alternative socialist wonderland where one can forget about how much money one is borrowing is for the birds.

Mr Peter Bone (Wellingborough) (Con): I am the happiest of Back Benchers now that we have a Prime Minister who stands up for British interests in Europe-although I have not received a Christmas card. Does the Prime Minister agree that the biggest scandal of the previous Labour Government was their surrender of Mrs Thatcher's rebate, the result of which is that we will pay £41 billion to the EU in the next five years, which is twice what we paid in the previous five years?

The Prime Minister: The card is in the post. I want to make my hon. Friend not just happy, but ecstatic. He is right about the rebate. We now get lectures from the Labour party, saying that we were not tough enough on the European budget. That is from the people who gave away the rebate and in return got absolutely nothing.

Andrew Stephenson (Pendle) (Con): The eurozone economy is vital to manufacturing and defence firms in Pendle, which export products across Europe and the globe. Alongside currency fluctuations and economic uncertainty, many businesses say that red tape and bureaucracy is the main challenge that they face. Was that issue addressed at the European Council?

The Prime Minister: I am glad that my hon. Friend asked that, because it is exactly the point that I made at the dinner of the 27 member states. We have to go through what would make a difference in creating more growth in the European Union. Of course, there are positive things that we have to do, such as completing the single market and extending it to services. However, there are also things that we should stop doing. There is a problem of endless directives coming through that add to the cost of business. There are some things that Europe must stop doing to give businesses the chance to invest and expand.

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