7 Nov 2012 : Column 843

7 Nov 2012 : Column 843

House of Commons

Wednesday 7 November 2012

The House met at half-past Eleven o’clock

Prayers

[Mr Speaker in the Chair]

Oral Answers to Questions

Cabinet Office

The Minister for the Cabinet Office was asked—

Civil Service Reform Plan

1. Craig Whittaker (Calder Valley) (Con): What progress he has made in implementing the civil service reform plan. [126832]

The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude): In June, we published a plan with specific actions to tackle long-standing weaknesses in the civil service, to build on strengths and to address frustrations expressed by civil servants themselves. If effectively implemented, the actions will lead to real change, which is urgently needed. The pace of change now needs to increase. Yesterday, we published the digital strategy, which sets outs how we can save money while improving the delivery of public services. That is an example of civil servants enthusiastically embracing and driving radical reform.

Craig Whittaker: Over the past decade, public sector productivity remained static while private sector productivity improved by a third. What steps is my right hon. Friend taking to ensure that the civil service learns best practice from business?

Mr Maude: After the coalition Government formed, we put in place the efficiency and reform group, which is driving a much more business-like approach to those areas of activity that run across government: the procurement of common goods and services; property; the management and oversight of major projects; and information and communications technology infrastructure, which was wholly unco-ordinated. All this is driving savings in the cost of government, but we need to do much more. The key to that is developing much more interchange between the private sector and the civil service, which the head of the civil service is committed to driving forward energetically.

Kelvin Hopkins (Luton North) (Lab): Will the Minister confirm that “reform” is not just code for privatisation, outsourcing and politicising the senior civil service? Will the civil service be retained as a neutral service to government, with proper ministerial responsibility?

7 Nov 2012 : Column 844

Mr Maude: There is no plan to change the basic rules of accountability, in the sense that there is a permanent, politically impartial civil service. However, there is a view, which I believe is shared right across the House, particularly by those who were Ministers in the previous Government, that responsiveness and effectiveness need to increase. That view is shared by the leadership of the civil service. One thing we are trying to do, through the civil service reform plan, is to respond to some of the frustrations expressed by civil servants themselves. They get very frustrated with the bureaucracy and the hierarchical nature of the service, as it is currently run.

13. [126846] Mel Stride (Central Devon) (Con): I congratulate my right hon. Friend on his bold and imaginative reforms of the civil service, particularly the mutualisation of the civil service pension scheme. May I press him to look at other areas of the civil service where that successful approach may be adopted?

Mr Maude: The movement towards mutualisation of public services is very powerful and is being looked at by other Governments, as well as our own. It is powerful because it enables entrepreneurial leaders in the public sector, of whom there are many, to take control of the services, innovate, do things differently and drive out cost. It is a powerful means of driving efficiency, for the taxpayer and for the user.

Jon Trickett (Hemsworth) (Lab): Today’s Institute for Government report reveals what it calls “fragile leadership” of the civil service reform programme. It is clear that the chaotic and expensive redundancy programme and the culture of blaming the service for blunders while Ministers get away scot-free is damaging morale. Even the right hon. Gentleman’s friends in the TaxPayers Alliance acknowledge that he is engaging in the costly practice of laying off staff while paying to recruit replacements. For all his bluster about savings, the Cabinet Office now has more staff than it had last year. When will he get a grip?

Mr Maude: Coming from the Parliamentary Private Secretary to the previous Prime Minister, who presided over a massive explosion in the size of the state and the growth of inefficiency—who presided over the decade in which public sector productivity was flat while private sector productivity grew by 30%—that is pretty rich. The hon. Gentleman refers to the expensive voluntary redundancy programme that has taken place. Under the position that his Government left—until we reformed the redundancy scheme—it would have been impossible to pursue that at all. The civil service today is considerably smaller. There are plans in Departments to reduce the size further, but productivity is already improving considerably. I just wish it had started under the previous Government.

Statutory Register of Lobbyists

2. Mr David Hanson (Delyn) (Lab): Whether his Department has issued guidance to other Departments on the likely implementation date of a statutory register of lobbyists. [126833]

7 Nov 2012 : Column 845

The Minister for Government Policy (Mr Oliver Letwin): The plans for developing a response to the Select Committee’s report and other evidence are still under way, and we have not issued guidance to Departments yet on a timetable. However, I rather think that we will do it quicker than the 13 years in which the previous Administration failed to introduce any systematic approach to lobbying.

Mr Hanson: Can the right hon. Gentleman confirm that the special adviser to the Secretary of State for Work and Pensions is also the paid chairman of an outside lobbying organisation? Does that not show the need for urgent guidance and, preferably, the statutory register of lobbyists that the Government have promised but so far failed to deliver?

Mr Letwin: I think I can say that I disagree with every part of the right hon. Gentleman’s question. He was a distinguished Minister in the previous Government and will be perfectly aware of these things. The special adviser in question made a full declaration of what she was doing to the permanent secretary and the Cabinet Office. It is also on the parliamentary register, because she is a special adviser. It is all perfectly appropriate and the Centre for Social Justice is not a lobbying organisation but a think tank with a long and passionate record of advocating social justice.

Mr Julian Brazier (Canterbury) (Con): Does my right hon. Friend agree that we need to look at internal as well as external lobbyists? May I encourage him in his work to identify the very large numbers of people who are working during paid public sector working hours for trade unions affiliated to the Labour party?

Mr Letwin: My hon. Friend makes a very good point. The Minister for the Cabinet Office and Paymaster General is already taking steps to limit the extent of the public payroll and the taxpayer supporting people engaged in trade union activity inside the civil service. My hon. Friend also raises a wider point. Part of the evidence from the Select Committee and others in response to our proposals on the register for lobbyists showed concern that they did not cover the question of those who lobbied on behalf of firms by which they were employed. We have taken major steps to make that more transparent by ensuring that Ministers reveal who comes to lobby them about any subject, regardless of whether they are internal or external. We are considering whether we can go further in that transparency.

John Cryer (Leyton and Wanstead) (Lab): The Prime Minister promised us a Bill two and half years ago and nothing has appeared. Is that because of incompetence or powerful vested interests on the Government Benches?

Mr Letwin: The short answer is neither. The reason the hon. Gentleman’s party failed to move on this for 13 years is that it is a genuinely complicated issue. We issued proposals not too long ago and we believe in evidence-based policy making rather than policy-based evidence making. We are therefore paying serious attention to the Select Committee of this House and to others and I would have expected the hon. Gentleman to congratulate us on doing so as Opposition Members

7 Nov 2012 : Column 846

frequently ask us to spend more time considering what has been proposed by Select Committees and others in response to our proposals.

Charlie Elphicke (Dover) (Con): May I press the Minister further? There is a big difference between lobbying and the important policy formation work done by think tanks, especially the excellent Centre for Social Justice. There is also a big difference between a special adviser who is a professional and one who is vocational and passionate, like Philippa Stroud.

Mr Letwin: My hon. Friend is absolutely right that there is a big difference. We must consider every measure we can to ensure that there is full transparency. In this case, there was transparency—the information can be seen on the register of the House and was fully reported to the permanent secretary and the Cabinet Office.

Apprentices

3. Robert Halfon (Harlow) (Con): What recent estimate he has made of the number of apprentices working in the supply chains of central Government departments and their agencies. [126834]

The Minister for Government Policy (Mr Oliver Letwin): I am conscious of the enormous work that my hon. Friend has done to promote apprenticeships. I believe that he recently launched the apprentice card, which is a huge innovation, and I think that he is the first ever Member of Parliament to have a parliamentary apprentice. The whole House owes him gratitude for that. We do not hold figures for the total number of apprenticeships across the supply chain of Government, which is obviously vast, but we have taken action to boost apprenticeships across British business as a whole, with 500,000 additional apprentices this year.

Robert Halfon: Since 2011, the Department for Work and Pensions has gently encouraged, through procurement, its private suppliers to hire apprentices. As a result, 2,000 apprentices have been hired. Is there anything the Cabinet Office can do to roll that out across Whitehall?

Mr Letwin: My hon. Friend is right that the DWP has managed to get almost 2,000 apprentices into its supply chain through its procurement practices. The Cabinet Office fully supports such schemes where they are appropriate and consistent with providing value for money. We encourage Departments to take forward proposals that are consistent with providing value for money.

Mr Iain McKenzie (Inverclyde) (Lab): Does the Minister share the views of the chairman of his party, who stated that prioritising apprenticeships and linking them to public sector contracts is “ridiculous” and “counter-productive”?

Mr Letwin: We are totally in favour of apprenticeships and of promoting them. My right hon. Friend the Member for Welwyn Hatfield (Grant Shapps) was saying —my right hon. Friend the Minister for the Cabinet Office and Paymaster General has repeated this—that we need to ensure that we get value for taxpayers’ money and do not create a set of rules that militate

7 Nov 2012 : Column 847

against that. Within that, we encourage and support those Departments that promote apprenticeships that are consistent with the provision of value for money. That is why in my response to my hon. Friend the Member for Harlow (Robert Halfon) I pointed out that we support and encourage schemes such as that promoted by the DWP.

Big Society Projects

4. Ms Margaret Ritchie (South Down) (SDLP): What recent progress he has made on delivering funding for big society projects. [126836]

The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd): I am delighted to say that of the £470 million Office for Civil Society budget, we have managed to find some funding to support a pilot in Northern Ireland of the hugely popular National Citizen Service programme, which I hope the hon. Lady supports. As I have said on many occasions, it is very important to us that the Big Society Capital opportunity is UK-wide, and it is categorically open for business in respect of Northern Ireland.

Ms Ritchie: I thank the Minister for his answer, but could he point to any exemplar big society projects that could provide good learning for other regions, apart from the one to which he referred, for which I am grateful?

Mr Hurd: There is plenty of good practice to point to. However, this area is effectively a devolved matter. In the case of the National Citizen Service, we came to the Administration with an offer, saying that we think this is a valuable experience for young people and we would like to make it available to young people in Northern Ireland. To their credit, the Administration said yes.

Richard Fuller (Bedford) (Con): Can my hon. Friend update the House about progress on the social impact finance project in Peterborough and assure the House that in developing social impact financing, he will look carefully at how it can be applied to other public sector projects?

Mr Hurd: I am grateful to my hon. Friend for his question. He takes a strong interest in the matter. The Government are ambitious to accelerate the development of social impact bonds, which create the space for commissioners to innovate and try new interventions in that space. We have already announced that we will shortly publish the details of an outcomes fund designed to do exactly that.

Mr Gareth Thomas (Harrow West) (Lab/Co-op): Four out of five small charities surveyed by the National Association for Voluntary and Community Action expect their finances to worsen in the next year as Government cuts bite even harder. Is not the truth that the Minister has so little ability to deliver extra funding for small charities’ big society projects that if he were to hop on a plane to Australia to join his hon. Friend the Member for Mid Bedfordshire (Nadine Dorries) in the jungle, nobody in the charity world would notice?

7 Nov 2012 : Column 848

Mr Hurd: Any Government cuts are the direct consequence of the fiscal incontinence of the Government that the hon. Gentleman adorned briefly as a Minister. We all know from our constituencies that this is an extremely tough time for charities and I could point to a long roll-call of initiatives taken by this Government, including new tax incentives, the gift aid small donations scheme, the implementation of the world’s first social investment bank and £50 million of matched funding for local charitable giving. This Government have a proud record of supporting the charity sector.

National Citizen Service

5. Margot James (Stourbridge) (Con): What plans he has for the National Citizen Service. [126837]

The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd): As I think my hon. Friend knows, the NCS is an enormously valuable experience for young people and we are keen to build on the success of the first two years’ pilots to make it available to every 16-year-old in the country.

Margot James: I visited the National Citizen Service in Dudley and I congratulate the Challenge network and the 150 students who took part last summer. Can my hon. Friend advise whether he has any plans to introduce private sponsorship so that we can widen participation in this excellent scheme?

Mr Hurd: I thank my hon. Friend for taking the time to visit her local project, and I thank all colleagues across the House who took the time to do so over the summer. I hope they see what I see and what independent research tells us, which is that the NCS experience is helping young people become more work-ready and employable. That is a direct benefit to business, which to date has contributed about £3 million to the costs of the programme. As we look to expand it and make it more available, I expect that number to rise.

Jenny Chapman (Darlington) (Lab): Youth services in Darlington have been decimated to pay for this pet project. If, when we have an evaluation, it turns out not to have been a roaring success, will the Minister put the money back?

Mr Hurd: The money has not come from youth services. That is a completely separate budget. The National Citizen Service programme is proving hugely valuable to young people. We have a 95% customer satisfaction rating and, to answer the hon. Lady’s question, independent research is already telling us that the social benefit to cost ratio is 2:1, and we look to build on that.

Government Contracts

6. Dr Phillip Lee (Bracknell) (Con): What steps he plans to take to enable small and medium-sized enterprises to secure more Government contracts. [126838]

8. Julian Smith (Skipton and Ripon) (Con): What recent assessment his Department has made of the extent to which small businesses are engaged with the process of public procurement. [126840]

7 Nov 2012 : Column 849

9. Ian Murray (Edinburgh South) (Lab): What progress he has made on making it easier for small and medium-sized enterprises to win public procurement contracts. [126841]

The Parliamentary Secretary, Cabinet Office (Miss Chloe Smith): Since the general election we have introduced radical measures to make it easier for SMEs to win Government business. These will support growth and innovation. Gone are barriers like unnecessary pre-qualification questionnaires. New opportunities are published on our contracts finder website and SMEs can challenge obstruction through the mystery shopper service.

Dr Lee: Over the past two years, I have been contacted by more than one construction company in my constituency that have encountered difficulties in securing small business contracts from both local and national Government. Will my hon. Friend continue to press Departments to remove the burdensome procedures and bureaucracy that make it harder for SMEs, such as those in my constituency, to compete for and win both local and national Government contracts?

Miss Smith: We certainly will. We have appointed an SME champion in every central Government Department, all Departments have presented their plans for increasing their percentage spend with SMEs, something Labour never bothered to measure, and our mystery shopper service will continue to provide an outlet for challenging poor service and conditions.

Julian Smith: Many small firms are still concerned that public procurement is based solely on price. How can we ensure that quality and sustainability are also taken into account?

Miss Smith: The public procurement policy for central Government is to award contracts on the basis of value for money, which covers a combination of cost and quality, as my hon. Friend would expect. Our mystery shopper service provides an outlet for challenging poor selection requirements, such as those he might have experienced in his constituency. I say once again that value for money is something that the Government like.

Ian Murray: The Minister claims that direct spend with SMEs has increased since the general election, but will she confirm that the recorded increase at the Ministry of Justice, the Department she claims has had the highest increase, is in fact due to officials starting to include small law firms providing legal aid services? Should those not be stripped from the figures?

Miss Smith: I can confirm that the spend on procurement with SMEs has gone up. I say again that it was this Government who bothered to count that spend, unlike those now on the Opposition Benches, and I think that that is something we should be proud of.

Mr Gregory Campbell (East Londonderry) (DUP): The Government have repeatedly indicated that they want to reduce the bureaucracy and red tape that can prevent SMEs getting contracts. Will the Minister outline what further steps will be taken over the next two and a half years to complete that task?

7 Nov 2012 : Column 850

Miss Smith: I point to the fact that we are publishing for the first time a pipeline of projects and procurements that are available from the Government. There is £70 billion worth of opportunities available as of this year. That builds industry confidence to invest. I would also point to the way we are disaggregating ICT contracts, for example, which will allow them to be more flexible and cheaper for smaller firms to bid for. I note in passing that the Public Accounts Committee has said that the previous Government’s management of IT contracts was a recipe for a rip-off.

Michael Dugher (Barnsley East) (Lab): In June this year the Minister for the Cabinet Office launched the Government procurement Solutions Exchange website, saying that it was

“an easy, informal way for smaller firms to find out about emerging opportunities”.

It all sounded very promising. Is he aware that for the past two months SMEs, when logging on to the website, have been greeted by the words, “Nothing available at this time”? You could not make it up. Why is that? Does not the phrase “Nothing available at this time” neatly sum up the Government’s complete lack of support for SMEs?

Miss Smith: I will tell you what is not available at this time, Mr Speaker: an Opposition policy to deal with any of that.

Mr Andrew Turner (Isle of Wight) (Con): Will the Government tell me how many small and micro-businesses are engaged nationally or regionally?

Miss Smith: I do not have the number to hand, but I am happy to write to my hon. Friend to help him.

Government Transparency

7. Dan Jarvis (Barnsley Central) (Lab): What recent assessment he has made of steps to improve transparency throughout Government. [126839]

The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude): The Government have a world-leading transparency programme, as is widely acknowledged. Open data sharpen accountability, inform choice over public services and offer raw material for a fast-growing industry of developers and entrepreneurs. As lead co-chair of the open government partnership, we are working with Governments the world over to embed transparency through stretching action plans.

Dan Jarvis: Does the Minister share my concern about the Government’s failure to extend freedom of information to private companies that deliver public services? Does that not make a mockery of the Government’s transparency agenda? If he does share my concern, what will his Department do about it?

Mr Maude: First, FOI is the responsibility of the Ministry of Justice, not my Department. Secondly, the Justice Committee recently undertook a wide-ranging post-legislative study of the Freedom of Information Act 2000—the Government will respond before too long—and, as I recollect, recommended no such change.

7 Nov 2012 : Column 851

Topical Questions

T1. [126847] Craig Whittaker (Calder Valley) (Con): If he will make a statement on his departmental responsibilities.

The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude): My responsibilities as Minister for the Cabinet Office are for the public sector efficiency and reform group, civil service issues, industrial relations in the public sector, Government transparency, civil contingency, civil society and cyber-security.

Craig Whittaker: My local authority currently gives teaching unions £8,000 a year out of the schools budget, as well as giving Unison £27,000 in cash and paying for its offices. In the light of the differences between the private and public sectors in this area, may I ask my right hon. Friend what is being done to bring this into line across the civil service?

Mr Maude: Anyone who has responsibility for spending public money needs to ensure that it is spent on the front-line services on which citizens depend. In the civil service, we discovered that 248 civil servants were doing nothing but trade union work at the taxpayers’ expense. Following our consultation, we have introduced tough new controls that will more than halve the cost of trade union activity to the taxpayer.

Mr Speaker: Order. There are far too many noisy private conversations taking place in the Chamber. Let us have a bit of order so that Members may actually be heard—it is something to do with manners.

T2. [126848] Mr Andy Slaughter (Hammersmith) (Lab): As the Minister seems to love contracting out work to the cosy cartel of G4S, A4e, Serco and Capita, does he not think that transparency should extend to those companies as much as it does to the public sector?

Mr Maude: We can, of course, build appropriate levels of transparency into contracts when services are contracted out. That process was taken a lot further by the previous Government, so it is not a feature of the coalition Government. I will pass on the hon. Gentleman’s concern to my right and hon. Friends in the Ministry of Justice.

T3. [126849] Simon Kirby (Brighton, Kemptown) (Con): Will the Minister update the House on the launch of gov.uk and the savings he expects to make?

Mr Maude: We published our digital strategy yesterday and launched gov.uk recently. We will make significant savings—gov.uk will save £36 million and, ultimately, when all the Departments migrate over to it, between £50 million and £70 million a year, and that is just to provide a much better service for citizens. As more and more of the transactions that people undertake with Government are moved online, we expect to save nearly £2 billion a year, and that is for a better service for the consumer.

T5. [126851] Simon Danczuk (Rochdale) (Lab): The National Audit Office report into Whitehall’s budget management showed that just 0.2% of Government

7 Nov 2012 : Column 852

spending is in the form of departmental joint submissions. There are opportunities for greater joint working and to save more money; what are Ministers doing to improve this?

Mr Maude: I think that every Minister in every Government I have ever known or observed would say that there is scope for much better joined-up activity between Departments. As a result of the civil service reform plan that we are now pushing through, with the strong support of the leadership of the civil service, we should have much greater interchange between Departments to break down the silos that partly cause the problem to which the hon. Gentleman rightly refers.

T4. [126850] Karl McCartney (Lincoln) (Con): Will my right hon. Friend update the House on the progress of the efficiency and reform group in driving savings across Government Departments?

The Parliamentary Secretary, Cabinet Office (Miss Chloe Smith): After the last general election, we set up that group to deal with the monstrous waste that the Labour Government presided over. It is a tribute to the hard work of civil servants here and across Whitehall that we saved taxpayers £3.75 billion in the first year and £5.5 billion last year. We are accelerating that work and targeting £8 billion this year.

Kate Green (Stretford and Urmston) (Lab): The civil service has traditionally been a good employer of women, black and minority ethnic staff and disabled staff. What equality measures are the Government taking to ensure that a 23% cut in staff by 2015 will have no adverse impact?

Mr Maude: I am grateful for the hon. Lady’s confirmation that the civil service is a good and diverse employer. I expect that to continue.

T6. [126852] Mr James Gray (North Wiltshire) (Con): Government spending on advertising and consultants of all kinds is nearly always wasteful, profligate and—[Interruption.]

Mr Speaker: Order. This is straightforwardly discourteous. The hon. Gentleman is trying to ask a question. I want the Minister to hear it and to answer. If, instead of rabbiting away from a sedentary position when their views are of no interest or concern whatever, people were to have the manners to listen, that would help.

Mr Gray: Thank you, Mr Speaker.

Government spending on advertising and consultants is nearly always wasteful, extravagant and profligate. What was the annual spend of the previous Government, how much has my right hon. Friend managed to cut it by, and what further plans does he have to squeeze this kind of waste out of Government spending?

Mr Maude: We saved nearly £400 million a year by restricting the spend on advertising and marketing, which was wholly incontinent under the previous Government. There are sometimes good cases for using consultants, but we have cut the spend on them by nearly 70%. These disciplines will continue for the future.

7 Nov 2012 : Column 853

Chris Bryant (Rhondda) (Lab): The Minister boasts about the Government’s transparency. The Cabinet Office still holds a large cache of e-mails from Andy Coulson to Rebekah Brooks. When will the Minister publish them?

Mr Maude: I think that the hon. Gentleman needs to change the record.

Prime Minister

The Prime Minister was asked—

Engagements

Q1. [126817] Mr Iain Wright (Hartlepool) (Lab): If he will list his official engagements for Wednesday 7 November.

The Deputy Prime Minister (Mr Nick Clegg): I have been asked to reply. As the House will know, my right hon. Friend the Prime Minister is on an official overseas visit to the middle east.

The whole House will wish to join me in paying tribute to the two British soldiers who were killed in Afghanistan last week: Lieutenant Edward Drummond-Baxter and Lance Corporal Siddhanta Kunwar of 1st Battalion the Royal Gurkha Rifles. Our heartfelt condolences are of course with the families and friends of these brave servicemen. In a particularly poignant week for us all, with Remembrance day on Sunday, we are once again reminded of the remarkable job that our armed forces do to ensure our safety and security.

Furthermore, the House will wish to join me in paying tribute to David Black, the Northern Ireland Prison Service officer who was shot and killed last Thursday. As my right hon. Friend the Secretary of State for Northern Ireland said in the House on Friday, we utterly condemn this cowardly crime. Our thoughts are with David’s wife and children at this distressing time.

I am sure that the House will also want to join me in congratulating President Obama on his election victory last night. [Hon. Members: “Hooray!”] I suspect that that is the only point at which I will be cheered today by Labour Members. We look forward to continuing the Government’s work with him in building a more prosperous, more free and more stable world.

This morning I had meetings with ministerial colleagues and others. In addition to my duties in this House I shall have further such meetings later today.

Mr Wright: May I fully associate myself with the sincere tribute paid to the two fallen servicemen and to David Black? It is right that this House pays tribute to those who have fallen in the service of our country, never more so than in the week of Remembrance Sunday.

May I also say that President Obama will be relieved to get the support of the Deputy Prime Minister?

The former Metropolitan Police Commissioner, Lord Stevens, has said that police morale is at national crisis levels. Is he right, and why is that the case?

7 Nov 2012 : Column 854

The Deputy Prime Minister: As the hon. Gentleman will know, the latest figures show that overall crime is down by 6%, that victim satisfaction with the police has gone up, that response time to emergency calls has been maintained or improved, and that crime has fallen precipitously in his own constituency. So when will he congratulate the police, rather than denigrate them, on doing a difficult job in dealing with savings, as everybody has to, while keeping the public safe?

David Rutley (Macclesfield) (Con): Does my right hon. Friend agree with the Chancellor and the German Finance Minister’s call for the OECD to accelerate plans to tackle the challenge of corporate tax avoidance by multinational companies?

The Deputy Prime Minister: Absolutely. I am sure that everybody will warmly welcome the work that the Chancellor is now doing with the Finance Ministry in Berlin to crack down on the industrial-scale tax avoidance by large corporate entities in this country and elsewhere that was allowed go on unchecked under 13 years of the Labour Government.

Ms Harriet Harman (Camberwell and Peckham) (Lab): May I join the Deputy Prime Minister in expressing our deepest condolences on the death of Lieutenant Edward Drummond-Baxter and Lance Corporal Siddhanta Kunwar, of 1st Battalion the Royal Gurkha Rifles? Our thoughts are with their families and friends. At Remembrance day services this Sunday we will remember not just those who died in the two world wars, but all our servicemen and women who have lost their lives. We also send our deepest sympathy to the family of David Black of the Northern Ireland Prison Service, who was killed last Thursday.

I also join the Deputy Prime Minister in offering our warmest congratulations to the President of the United States, Barack Obama. This morning, he spoke of his determination to create more jobs, health care for all, and to tackle the scourge of inequality. We wish him well.

Lord Justice Leveson will be publishing his report and recommendations soon. The Deputy Prime Minister said that provided those proposals are “proportionate and workable”, the Government should implement them, and the Opposition agree. When Leveson’s report is published, will the Government convene cross-party talks to take it forward? We need a strong, free press, and a proper system to protect people from being, as the Prime Minister said, “thrown to the wolves”.

The Deputy Prime Minister: I agree with much of what the right hon. and learned Lady says about Leveson. We have not yet seen his proposals and we must wait to see what he comes up with, but if those proposals are workable and proportionate, we should, of course, seek to support them. That is the whole point of the exercise. I also agree that we should work on a cross-party basis where we can. This is a major issue that escapes normal tribal point scoring in party politics, and there are two principles, both of which the right hon. and learned Lady alludes to. First, we must do everything we can to ensure that we maintain a free, raucous and independent press. That is what makes our democracy and the country what it is. Secondly, we must ensure that the vulnerable

7 Nov 2012 : Column 855

are protected from abuse by the powerful, which happened on an unacceptable scale on too many occasions. We need to be able to look the parents of Milly Dowler in the eye, and say that, in future, there will be permanently independent forms of recourse, sanction and accountability when things go wrong.

Ms Harman: I thank the Deputy Prime Minister for that answer. We must have a press that report the truth without fear or favour. However, after all the evidence that came out during the inquiry, particularly, as he says, from the Dowlers and the McCanns, we simply cannot continue with the status quo, or a press complaints system in which a publication can simply walk away, or a system that is run by the press. Does the Deputy Prime Minister agree that a version of “business as usual” will simply not do? It would be a dereliction of our duty to allow the Leveson report to be kicked into the long grass.

The Deputy Prime Minister: I think everybody accepts, whatever their individual views about this matter, that “business as usual” is simply not acceptable. The status quo has failed, and it has failed over and over again. The model of self-regulation that we have seen over the past few years has not worked when things have gone awry. I certainly agree with that premise, and we in Government created the Leveson inquiry to seek out recommendations for change. That is the whole point of the Leveson inquiry.

Ms Harman: I look forward to all hon. Members having the opportunity to work together in the public interest to get this right.

This week, the Deputy Prime Minister sent an e-mail to his party members. In it, he described the task of finding child care as a “real nightmare”. Is it not clear that cutting the child care element of tax credits has made that nightmare worse for parents?

The Deputy Prime Minister: What has helped many people who have struggled to make ends meet and pay for child care is the fact that this Government are providing 15 hours of free, pre-school support and child care to every three and four-year-old in the country. No Government have done that before, and as of next April, it is this Government who will be providing 15 hours of pre-school support and child care to some of the poorest two-year-olds in the country. No other Government have done that before. It is this Government who are taking 2 million people on low pay out of paying any income tax altogether, and that is a record I am proud of.

Ms Harman: The Deputy Prime Minister’s answer has shown that he is completely out of touch. The reality is that many part-time working parents are having to give up their jobs because of the cuts in tax credit, and having instead to be on benefits. I asked him about the child care element of the tax credit, and he has not answered. Why will he not admit that the cut he voted for has cost families £500, and 44,000 families are losing out? If that was not bad enough, the Government are cutting £1 billion from Sure Start. In his e-mail, he said he would reveal—[Interruption.]

7 Nov 2012 : Column 856

Mr Speaker: Order. The junior Minister in the back row—the Under-Secretary of State for Health, the hon. Member for Broxtowe (Anna Soubry)—thinks her views are relevant, but we are not interested. [Interruption.] Order. I do not want heckling. I want the question to be heard, and it will be heard with courtesy. If the session has to be extended for that to happen, so be it.

Ms Harman: Thank you, Mr Speaker. I am beginning to have quite a lot of sympathy with the hon. Member for Mid Bedfordshire (Nadine Dorries) and her experience of all those rats and snakes—even before she went to the jungle.

In the Deputy Prime Minister’s e-mail, he said he would reveal—[Interruption.]

Mr Speaker: Order. I have made the point once, and I am going to make it only once more. Mr Jason McCartney: your heckling is not wanted, it does not help. Stop it, and stop it for the remainder of this session and in future. I have made the position clear.

Ms Harman: Thank you, Mr Speaker.

In the Deputy Prime Minister’s e-mail, he said he would reveal what really goes on behind those Whitehall doors. Perhaps in next week’s instalment, he will therefore tell the truth: under his Government, families are worse off, aren’t they?

The Deputy Prime Minister: As of next April, because of one of the most radical tax changes introduced by any Government in living memory, 24 million basic rate taxpayers will be £550 better off. That is a radical change I am very proud of. I am proud of the fact that two, three and four-year-olds will benefit from our changes. As the right hon. and learned Lady may have noticed, the much-quoted Resolution Trust report recently showed that tax credits are not the best answers for many families. Yes, I accept that we need to do more to make child care affordable, so that more women can get back into work at an earlier stage. That is what this Government are setting about doing while we are cleaning up the mess she left behind.

Ms Harman: The Deputy Prime Minister comes to the Dispatch Box and says one thing, but he does something completely different—he is at it again on the police. Two years ago, he made a solemn election pledge that the Lib Dems would provide 3,000 more police officers, but there are not more—there are 6,800 fewer. It is tuition fees all over again. Why should anyone trust the Lib Dems on policing?

The Deputy Prime Minister: At least people can trust the Conservatives and Lib Dems on the economy. Let me explain. The shadow Chancellor is not here—[Interruption.]

Mr Speaker: Order. The right hon. Gentleman is in danger of being heckled rather noisily and stupidly by both sides. His answer will be heard, however long it takes, so the juvenile delinquency should stop now.

The Deputy Prime Minister: I am used to getting it from both sides.

7 Nov 2012 : Column 857

The shadow Chancellor is not in the Chamber, but just to underline my point, last year, in a television interview, he denied that there was a structural deficit while Labour was in power. Last month, in another television interview, he denied the denial. Now that he is briefing against himself in television interviews, how an earth will anyone ever have any faith that his lot can sort out the economy?

Ms Harman: People are finding that they cannot trust this Government on the economy. Because of the Government the Deputy Prime Minister supports, we have lost two years of economic growth, and borrowing is going up. I do not know why Government Members are all so cheerful about the cuts in police numbers. They might not be bothered, but their constituents certainly are. It is always the same with the Lib Dems. People cannot trust them on tuition fees or child care, and when it comes to voting next week, people will remember that they certainly cannot trust them on the police.

The Deputy Prime Minister: What about her promise of no boom and bust? What happened to that one? This coalition has now been in power for two and a half years. In those two and a half years, we have given 24 million basic rate taxpayers an income tax cut; we have taken 2 million on low pay out of paying any income tax; we have cut the deficit by a quarter; and we have reformed welfare. What have she and her colleagues done? What have they done? They have gone on a few marches; they have denied any responsibility for the mess we are in; and they have not even filled in their blank sheet of paper where there should be some policies. She might be hoping for some bad news to make her point: we are sorting out the mess she left behind.

Q2. [126818] Steve Brine (Winchester) (Con): Moving on, as we must, I echo the Deputy Prime Minister’s comments on the US presidential election and congratulate Mr Obama on his victory. It is always good to see a leader re-elected in difficult times. Does the Deputy Prime Minister agree that, alongside new, emerging markets—including, of course, those in the middle east—Britain should seek to strengthen our economic and trade ties with the US through a new trade deal, as we seek to boost our recovery and perhaps start one across the channel?

The Deputy Prime Minister: I agree with the hon. Gentleman. The lesson of the presidential election is that voters’ memories are longer than Opposition Members seem to think, because when it comes to actually casting a vote, voters remember who created the mess in the first place and who has to do the painstaking, difficult and, yes, longer than we had hoped job of sorting out that mess.

On the wider issue, of course there is so much we now need to do to work with the new Obama Administration. The hon. Gentleman mentions trade: I would like to see a new EU-US free trade agreement, which could create a real spur to economic growth in both economies. I was also delighted to hear overnight that President Obama singled out his commitment to dealing with climate change—another area in which we can work very well with him.

7 Nov 2012 : Column 858

Q3. [126819] Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op): The Deputy Prime Minister tells us that he supports the living wage and the increase announced on Monday. Can he tell us how many Lib Dem councils pay the living wage?

The Deputy Prime Minister: As the hon. Lady knows—[Interruption.]

Mr Speaker: Order. The hon. Lady has asked the Deputy Prime Minister a question. I hope that hon. Members will have the courtesy to listen to the answer. I certainly want to hear it.

The Deputy Prime Minister: As the hon. Lady knows, her own leader has said that this is a voluntary process by which we need to encourage councils and employers in the public and private sectors to pay the living wage. No one will disagree with the idea of a living wage, with people being paid a fair wage for a fair day’s work, but there is a lot of extra work to be done to make that a reality. But guess what? It is this Government’s tax changes that will mean that as of next April someone on the minimum wage will have their income tax cut by half.

Mr John Leech (Manchester, Withington) (LD): The tragic death of Private David Lee Collins while off duty in Cyprus is a devastating blow to his mother, who is my constituent, and to family and friends across Manchester. Will the Deputy Prime Minister assure me that the Foreign Office and the Ministry of Defence are working with the Cypriot authorities to ensure that the perpetrators are brought to justice?

The Deputy Prime Minister: Everybody’s hearts will go out to the mother and other family and friends of David Lee Collins, who came to such an untimely death in the way my hon. Friend describes. It is obviously right for him to raise the issue on behalf of David Lee Collins’s mother, and I can certainly assure him that the Ministry of Defence and the Foreign Office will do everything they can to find out exactly what happened and bring the perpetrators to justice. I am sure that the Secretary of State for Defence, who is in his place, will seek to keep him updated as things evolve.

Q4. [126820] Rosie Cooper (West Lancashire) (Lab): Homes were wrecked and much-needed crops destroyed in the devastating floods that affected my constituency last month, and there are warnings that we face another winter of floods. The Government promised to bring forward plans for a new deal on flood insurance in July, but my worried constituents are still waiting. When will this incompetent and out of touch Government actually act on ensuring that ordinary families and businesses are protected from flooding—or will this be another broken promise?

The Deputy Prime Minister: The hon. Lady packed every soundbite into that one. We are involved in very detailed discussions with the insurance industry precisely to provide her constituents with the reassurances they rightly seek. I point out only that that is an agreement between the Government and the insurance industry that was never reached in the 13 years when Labour was in power. We are doing that work now. It is complicated

7 Nov 2012 : Column 859

work. It is very important work. We are devoting a lot of attention to it, and I hope we will be able to make an announcement in the not-too-distant future.

Q13. [126830] Geoffrey Clifton-Brown (The Cotswolds) (Con): Thousands of people in Syria are being killed each month, and the suffering of its people is immense. Sources within the country say that British assistance has been slow, and that the priority ought to be to support the civil administration councils so that basic water and sewerage services can be connected. What more can the Prime Minister do, in discussion with President Obama, to bring about a solution to this crisis?

The Deputy Prime Minister: I know that the Prime Minister, who of course is in the region right now, discusses this on an ongoing basis with the President of the United States, and will continue to do so. We are the second largest bilateral donor in Syria. Of course, the circumstances on the ground are incredibly difficult for the delivery of aid and assistance, but we need to make every effort to accelerate it, and to get it to the right people in a timely manner and to the right places. Any suggestions that the hon. Gentleman wishes to make to the Department for International Development, and to other Departments, about how we should do that would of course be warmly received.

Q5. [126821] Lilian Greenwood (Nottingham South) (Lab): Official documents show that the Healthier Together review’s “best option” is downgrading Kettering general hospital’s A and E, maternity, children and acute services, and cutting 515 of its 658 beds. How can anyone believe the Prime Minister when he claims that those NHS services are safe in his hands?

The Deputy Prime Minister: I find it extraordinary that the hon. Lady persists in this wilful scaremongering. She plucks out the worst-case scenario when, as she knows, no decision has been taken. Instead of frightening people about what is happening in our NHS, why does she not celebrate the great work of our nurses, our doctors and other clinicians in the NHS who are delivering an absolutely world-class service for the people of Kettering, Corby and elsewhere?

Oliver Colvile (Plymouth, Sutton and Devonport) (Con): Will the Deputy Prime Minister confirm the Government’s commitment to marine renewable energy, especially in the south-west?

The Deputy Prime Minister: Marine renewable energy is clearly an area where the south-west has a natural advantage, and is one of the many areas of renewable energy that is reflected in our diverse approach to renewable energy generation. We have to wean ourselves off an over-reliance on one kind of energy generation, and spread our bets more fairly and sustainably in the future.

Q6. [126822] Valerie Vaz (Walsall South) (Lab): Not only is it Obama day, but national adoption week. My ten-minute rule Bill in the previous Session called for equalising statutory rights for leave, pay and allowances between adoptive parents and parents whose children are born to them. That can be done by regulations, so will the Deputy Prime Minister ask a Minister or two to meet me to eliminate that unfairness?

7 Nov 2012 : Column 860

The Deputy Prime Minister: I will certainly make sure that the relevant Minister meets the hon. Lady, and I pay tribute to her for her long-standing campaign to equalise the rights of parents of adopted children—for instance, on parental leave—with other parents. I certainly believe that that should be the case. The Government have been looking at the issue closely and I hope that we will be able to make an announcement in the not-too-distant future.

Charlie Elphicke (Dover) (Con): Does the Deputy Prime Minister agree that the Chancellor’s initiative to get the OECD to crackdown on international tax avoidance is all the more important when one considers that non-oil corporation tax went up by just 6% in the past 15 years, while income tax receipts almost doubled?

The Deputy Prime Minister: Yes, and that is why it is right that the Treasury and the Chancellor have been so assiduous in providing additional resources to ensure that the teams in Whitehall—Her Majesty’s Revenue and Customs and others—who crack down on tax avoidance are able to do so. The figures that we hope to be able to recoup in tax paid, which would otherwise have been avoided, are truly eye-watering. Billions and billions of pounds of tax will come into the vaults of the Exchequer which otherwise would have gone walkabout.


Q7. [126824] Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP): The newly published world prosperity index shows our Nordic neighbours, Norway, Sweden and Denmark, holding the top three spots. In the last quarter, the oil fund of our neighbour Norway grew by $29.3 billion to an eye-watering $660 billion—equivalent to £5,000 for each Norwegian family. Will the Deputy Prime Minister take this opportunity to congratulate the Norwegians on their society and their enviable prosperity?

The Deputy Prime Minister: The Scottish National party’s arc of prosperity keeps changing. Last time I looked, it included Iceland, but now it does not. What will the hon. Gentleman do next? Pick out Malaysia or Indonesia? Try and be a bit more consistent, please!

Mark Reckless (Rochester and Strood) (Con): Does the Deputy Prime Minister expect to be involved in the selection process for our next EU Commissioner?

The Deputy Prime Minister: I will not be a candidate, however much the hon. Gentleman might hope otherwise.

Q8. [126825] Karl Turner (Kingston upon Hull East) (Lab): The Deputy Prime Minister’s predecessor and mine is Labour’s excellent candidate in the police and crime commissioner elections in Humberside, but the Tory candidate describes the role as the “job from hell”. Does he agree with his Tory colleague, or does he think that he has it harder?

The Deputy Prime Minister: I will not try to compare notes with my predecessor on the police and crime commissioner elections. I hope that everyone will turn out to vote, but the fact that so many has-been Labour politicians and recycled ex-Labour Ministers are standing might put quite a lot of people off. None the less, I hope that people will participate in these important elections.

7 Nov 2012 : Column 861

Mark Garnier (Wyre Forest) (Con): Last week, Stephen Farrow was sentenced to life imprisonment for the brutal murder of my constituent Betty Yates and of Thornbury resident Rev. John Suddards. Will the Deputy Prime Minister join me in sending our congratulations to the police and thanking them for the speedy and successful conclusion of this case and in sending our deepest condolences to the families of both victims?

The Deputy Prime Minister: I am sure that the whole House wishes to join my hon. Friend in sending our sincerest heartfelt condolences to the victims’ families and friends and, as he said, in paying tribute to the police for moving very fast. It is incredibly important in heart-rending cases such as these that the public see that, where possible, justice is done and done as rapidly as possible.

Q9. [126826] Ian Lavery (Wansbeck) (Lab): Will the Deputy Prime Minister explain to the House why the Liberal Democrats are fielding only 21 candidates out of 44 in the police and crime commissioner elections?

The Deputy Prime Minister: Because we are standing in those areas where Liberal Democrats wish to stand as candidates. [Laughter.] I know that the Labour party does not understand the meaning of the words “internal party democracy”, but it is something I am proud we have. The hon. Gentleman should try it some day.

Q10. [126827] Simon Hughes (Bermondsey and Old Southwark) (LD): After inheriting from Labour a legacy of obscene bonuses and the biggest divide between rich and poor, will my right hon. Friend make it clear that the Government’s overriding ambition is to deliver a fairer Britain, and that one way of doing that is through affordable and social rented housing that delivers both fairness and growth?

The Deputy Prime Minister: Yes, and that is why it is so important that we have committed to £20 billion of investment in affordable housing, generating tens and tens of thousands of more affordable homes so that families have an affordable home they can call their own. I also draw my right hon. Friend’s attention to the significance of the announcement by the Secretary of State for Communities and Local Government yesterday that we will be looking at doubling the amount of money in local authority pension funds that can be used to invest up to £22 billion of extra money into local infrastructure. That is the way to make this country fair and to get the economy moving.

Q11. [126828] Jim Shannon (Strangford) (DUP): On behalf of my party, may I join in the tribute to the two soldiers, as well as prison officer David Black, who gave their lives last week? Tomorrow morning will mark the 25th anniversary of the Poppy Day massacre in Enniskillen. Twelve lives were cruelly taken and 63 people were injured when the IRA bombed the service of remembrance at the town’s cenotaph. This week, the police received a new line of inquiry. Will the Deputy Prime Minister join me in echoing the survivors’ call for justice and for new information to be brought forward?

The Deputy Prime Minister: I am sure the hon. Gentleman speaks on behalf of us all when he says we

7 Nov 2012 : Column 862

should pause and reflect on the terrible suffering of those who now have to re-live, 25 years later, all the memories of that terrible atrocity and those who were killed, injured or maimed. I know that the Secretary of State for Northern Ireland will be attending the anniversary event. This is an extremely difficult week for all who suffered at that time and have had to live with those memories ever since; and, yes, of course I can confirm that where there are new leads or new evidence, they will be pursued rigorously, and we will provide all support to ensure that that is the case.

John Hemming (Birmingham, Yardley) (LD): Under the previous Government, officials used discretion to refuse to provide to people who were brought up in care information about their cases. Will the Deputy Prime Minister look to open the files so that people who were brought up in care can find out what happened to them?

The Deputy Prime Minister: I certainly think my hon. Friend is right in saying that, given the daily drip, drip effect of these horrific revelations—which seem to get worse every day—about things that seem to have taken place on a scale that was before now unimaginable, we should send out a clear message from all parts of this House to any victim who is sitting at home alone, still harbouring terrible memories of the terrible suffering they endured, that this is the time for them to speak out. This is the time for them to come forward. We will help them; we will reach out to them. We will make sure that their suffering is atoned for and that where we can find those who perpetrated these terrible abuses, they are brought to justice, even several years since those events might first have occurred.

Q12. [126829] Gemma Doyle (West Dunbartonshire) (Lab/Co-op): Scotland’s First Minister has misled the public on legal advice that does not exist and rewritten the ministerial code for his own gain, and there are strong suggestions that he will ignore the Electoral Commission in the upcoming referendum. People in Scotland are losing faith in the First Minister, and this Government are in danger of being complicit in yet another muddle. Does the Deputy Prime Minister trust the First Minister to deliver a fair, legal and decisive referendum on separation?

The Deputy Prime Minister: I hope the hon. Lady will recognise that we have been working on a cross-party basis, particularly with those parties that believe in maintaining the family of nations in the United Kingdom, to ensure a fair, legal and decisive vote in the referendum. I certainly agree with her characterisation: the spectacle of the SNP Administration using taxpayers’ money to stop disclosure to the public of legal advice that they never sought in the first place—honestly, you couldn’t make it up. It is almost a bit like dropping Iceland from the arc of prosperity.

Q14. [126831] Mr Alan Reid (Argyll and Bute) (LD): Rising prices to heat their homes and drive their cars are putting enormous pressures on people, particularly in large rural areas such as Argyll and Bute. What steps will my right hon. Friend take to make the tax system fairer and put more money in the pockets of people on low and middle incomes to help them to pay these rising bills?

7 Nov 2012 : Column 863

The Deputy Prime Minister: That is precisely why the centrepiece tax reform of this Government is a radical one to lift the point at which people start paying income tax to £10,000, up from £6,400, which is where we found it when we took over from Labour. When we deliver that, it will deliver a £700 tax cut to more than 24 million basic-rate taxpayers in this country, including in my hon. Friend’s constituency. We should celebrate that.

Mr David Winnick (Walsall North) (Lab): Bearing in mind that we were selling arms to the Gaddafi regime right up to the uprising, is the Deputy Prime Minister pleased that the Prime Minister is busy now selling arms to Saudi Arabia, a country where human rights are non-existent and where amputations and floggings take place frequently—and we know how women are treated there? Is that Liberal Democrat policy as well?

The Deputy Prime Minister: As the hon. Gentleman will know, we have the strictest controls of almost any developed economy in the world governing the conditions under which we can sell arms to other countries. Nothing that we do in promoting our arms industry, which employs thousands of people in this country, impedes our ability to tell allies and other Governments where

7 Nov 2012 : Column 864

we have real concerns about their human rights record, democratic record or civil liberties record, and that is exactly what the Prime Minister has been doing this week.

Mr Peter Bone (Wellingborough) (Con): I sometimes think the Deputy Prime Minister would like to send me to a jungle in Australia for a month, but does he agree that when two different parties get together in the national interest to clear up the mess that Labour left us, we are doing the right thing, in particular by driving unemployment down? Let me just pick one constituency: in Corby, it went down 4.6% last month.

The Deputy Prime Minister: For the first time in my parliamentary career I wholeheartedly agree with the hon. Gentleman. Let us savour and treasure this moment, because I suspect it will be very, very rare indeed. Like him, when I heard that the hon. Member for Mid Bedfordshire (Nadine Dorries) had been sent to a jungle to eat insects, I thought that, despite the appearance of civility from our new Chief Whip, it indicated a new disciplinarian approach in our Whips Office. I totally agree with the hon. Gentleman: we are doing the great job together of fixing the economy and creating jobs for people in the future, and that is a great shared endeavour.

7 Nov 2012 : Column 865

Family Perinatal Support and Adoption

Motion for leave to bring in a Bill (Standing Order No. 23)

12.35 pm

Andrea Leadsom (South Northamptonshire) (Con): I beg to move,

That leave be given to bring in a Bill to require the Secretary of State to provide appropriate perinatal support to any family expecting a child who will be born on to the child protection register and for whom an adoption plan has not been made at the moment the child is entered on to the register; to require that a decision be made not later than one year after the child’s birth as to whether or not such a child will be adopted; and for connected purposes.

I am a huge advocate of early-years intervention, and of the vital importance of parents establishing a secure bond with their new baby. During adoption week, we need to recommit ourselves to ensuring that the most vulnerable in our society get every chance to achieve their lifelong potential.

Astonishingly, in the first year of life, a baby’s brain forms 1 million brain connections per second. It is the baby’s earliest experiences that will largely determine the nature and extent of those vital connections. It is a fact that the period from conception to the age of two is the most crucial time to harness a loving and secure attachment that will, in turn, have a profound impact on the baby’s capacity for lifelong emotional health.

At one level, achieving a secure attachment between baby and carer sounds simple. It is the cooing, the loving eye contact and the singing of baby songs—the things that many parents find perfectly natural—that stimulate the development of the baby’s frontal cortex. That is the part of the brain that deals with our emotional capacity as human beings. A healthy brain equips the baby to deal with life’s ups and downs, and that baby will grow up able to make friends, hold down a job, find a partner and eventually be a good parent themselves.

Forming that secure bond does not come easily to everyone, however. In fact, it is completely natural for someone to treat their own baby in the same way as their own parents treated them. Poor attachments offer miserable outcomes for infants, and they are all too often passed down as a cycle of misery through generations. I would not go so far as to say that poor attachment means that a terrible life is inevitable for such an infant, but evidence suggests that society pays a high price for not intervening early. Our prisons, our hostels for homeless people and our psychiatric hospitals are full of the evidence of poor attachment.

The point of the Bill is to recognise the urgent needs of babies who are placed on the child protection register even before they are born. During 2011, 748 babies were born on to the child protection register in England and Wales. Of the 4,190 babies under the age of one in the care system in England and Wales, 505 were referred for adoption in 2011-12, but just 77—some 15%—were actually adopted. If that pattern were repeated for babies born on to the child protection register last year, only 112 would be adopted. It is difficult to imagine how any of the 636 babies still in care could develop the secure bond with a loving adult carer that they need in order for their fast-growing brain to develop a healthy emotional capability.

7 Nov 2012 : Column 866

Circumstances in which a baby might be born on to the child protection register include previous incidents of neglect or abuse towards children; a parent who might be involved with a registered sex offender or a violent partner; and a parent who might be heavily addicted to drugs. In all these situations, it is vital that the decision to adopt remains utterly focused on the baby’s urgent need for a loving parent or carer. Of course it is right that birth parents who are good enough are always best for their baby. That is why my Bill calls for appropriate support to be provided to parents in the perinatal period where their capacity to be good enough parents is in question.

I have been personally involved with parent-infant partnerships in a voluntary capacity for 13 years. OXPIP, the Oxford parent-infant project, delivering psychotherapy support for struggling families in Oxfordshire, and NORPIP, the sister charity in Northamptonshire, have both seen successes, working therapeutically with parents whose children are on the child protection register. Just as important, where the difficulties are huge, the assessment of a trained parent-infant psychotherapist has enabled evidence-based decisions to be made at an early stage about the ability of the birth parent to make the transition to be good enough. No one, least of all me, wants to see babies taken away from their birth parents, but the sad truth is that, currently, decision taking is just too slow for the baby’s emotional needs and not always based on sound enough evidence.

At the moment, the average age of a child who is adopted is three and a half, so those 500-plus under-ones waiting to be adopted could have a long stretch until they are finally placed in a loving home. Damningly, children are mostly taken into care after the age of 10, when all too often they are already demonstrating the consequences of poor early attachment.

We are all concerned about the human cost of babies and children taken into care, but as public servants the economic consequences should also massively concern us. The basic cost of a child in care is £45,000 a year, rising to an incredible £280,000 a year where the child has severe emotional or learning difficulties. Opening up access to appropriate early-years intervention, and at the same time committing to faster, evidence-based decisions about whether a baby should be adopted or supported with birth parents, could decrease the eye-watering costs of the care system, as well as avoid the enormous costs in criminal justice and health care that are so often incurred by those who have had a disastrous start in life.

I am very supportive of the steps the Government are already taking. We have set out plans to reduce the time it takes between a child first entering care and being adopted, and we are working to increase the number of adopters being recruited and approved. I am pleased that the Government are making “fostering for adoption” standard practice in appropriate cases, so that children can move in with their likely permanent families much earlier. I absolutely share the Government’s aspiration for a happier, stronger and more stable future for children in care becoming a reality.

However, the need for an early-years intervention model to be articulated and rolled out by Government has never been stronger. Neuroscience and the advent of neuro-imaging supports the idea that secure attachment, with the resulting healthy brain development of infants,

7 Nov 2012 : Column 867

is the key foundation on which rests the potential for lifelong emotional health. If the physical health of the nation, through the NHS, was one of the greatest achievements of the 20th century, I hope that the mental health of the nation, through access to early-years intervention, will become one of the greatest achievements of the 21st century.

Question put and agreed to.

Ordered,

That Andrea Leadsom, Fiona Bruce, Harriet Baldwin, Jim Shannon, Mr Frank Field, Mr Graham Allen, Andrew Selous, Damian Hinds, Tim Loughton, Meg Munn, Mr Gary Streeter and Robert Halfon present the Bill.

Andrea Leadsom accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 1 March 2013, and to be printed (Bill 88).

7 Nov 2012 : Column 868

Opposition Day

[8th Allotted Day]

Regional Pay (NHS)

Mr Speaker: I inform the House that I have selected the amendment in the name of the Prime Minister.

12.45 pm

Andy Burnham (Leigh) (Lab): I beg to move,

That this House believes national pay agreements are an important part of the infrastructure that underpins a national health service; notes reports of the statement by the Deputy Prime Minister that there is going to be no regional pay system; further notes with increasing concern attempts by 20 trusts in the South West of England to opt out of national agreements by reducing staff pay and changing terms and conditions; notes with concern that an additional 11 trusts across England are considering similar moves; and calls on the Government to intervene without delay and uphold the principle of national pay arrangements in the NHS.

My right hon. and hon. Friends and I have called this debate with a clear purpose: to build support across the House for a health service that remains national in character, and to send the clearest of signals to those threatening to break it apart. National pay is part of the glue that holds together a national health service. In turn, the NHS is part of what holds our country together: a one-nation service bridging the social and economic divides of our country, uniting east and west, north and south; a service with fairness at its heart, where, from Newcastle to Newquay, patients can walk through the door and expect to meet staff with the same values, the same motivations and the same level of commitment to their employer.

The debate is not a narrow argument about levels of pay. It is about the character of our health service and the cohesion of our country. Like the BBC, the NHS is one of the country’s great unifying forces—a service that sees no differences, treating people, patients and staff with the same respect, wherever they come from, whatever their background. The “N” in NHS should be cherished, but instead it is coming under ideological attack.

Several hon. Members rose

Andy Burnham: I know that many Members want to speak in the debate, so I shall give way once or twice, to ensure that there is time left for others to contribute.

Henry Smith (Crawley) (Con): The right hon. Gentleman is right that it is a national health service that this country enjoys. Why, therefore, is a Labour Administration reducing funding to the health service in Wales?

Andy Burnham: I am here to talk about the NHS in England. I will come on to the Conservative Government’s record on funding the NHS in England, so I would not be so smug if I were the hon. Gentleman.

The drive to turn collaboration into competition depends on breaking national standards—breaking the “N” in NHS. The former Health Secretary’s request to the pay review body to consider the case for “market-facing pay” needs to be seen alongside his Health and Social

7 Nov 2012 : Column 869

Care Act 2012. Breaking national pay in the NHS is an essential step towards creating the free market in health that many in the Conservative party have long wanted, and which the Liberals now seem willing to let them have.

Mr Stephen Dorrell (Charnwood) (Con): Will the right hon. Gentleman confirm that the direction towards market-facing pay should also be seen in the context of the statement in the Budget presented by the previous Government in 2003 committing them to increase regional and local flexibility in public service pay systems? Did he support that when he was Secretary of State?

Andy Burnham: The Labour Government did introduce some flexibility, but let me tell the right hon. Gentleman my record: I spoke up, at every opportunity, for the principle of national pay underpinning a national health service. We hear nothing similar from Government Front Benchers. We built a progressive system of pay for the NHS in “Agenda for Change”, which brought fairness and stability to the system. By the time we left office, not one trust had opted out of that national system of pay, and only one, Southend, paid an increment on top.

Mr Dorrell: Will the right hon. Gentleman give way?

Andy Burnham: No, I will make some progress.

Breaking national pay is what the Government want to do, and that springs from an entirely different philosophy from the one that forged the NHS in the first place. The Government are rejecting the “one NHS” approach, whereby hospitals collaborate and the unpredictable pressures of any health service are balanced across the system. Instead, they have a vision of hospitals as stand-alone small businesses, on their own in the marketplace, with no bail-outs and free to earn up to 49% of their income from the treatment of private patients, but—as we are seeing in south-east London—finding little mercy in a private-sector-style administration process if the sums do not add up. That is a very different vision of the NHS, and it is not one to which the British people have ever given their consent in a general election.

Andrew George (St Ives) (LD): I will join the right hon. Gentleman in the Lobbies on one reasonable condition: he acknowledges that the last Labour Government did not just introduce regional pay in the Courts Service, but introduced flexibilities for foundation trusts which, through employment law, could result in detriment to NHS employees. If he acknowledges that and apologises for his introductory remarks, I will certainly join him in the Lobbies.

Andy Burnham: I partly welcome what the hon. Gentleman has said. I have already acknowledged the flexibilities, and mentioned that only one trust in England ever sought to make use of them, because it wanted to add to the national floor that we had introduced. The flexibilities were there and I support them, but we left office with a national pay system in place. I look forward to his support later this afternoon.

We have a new Secretary of State, but those who expect a change of direction look set to be disappointed. In his first major interview, he described his mission thus:

“I would like to be the person who safeguards Andrew Lansley’s legacy”.

7 Nov 2012 : Column 870

That must qualify as the shortest suicide note in political history. We have Lansley-lite—more of the same—but, in fact, it may be worse.

Looking at the Secretary of State’s past speeches, I could find nothing that conveyed any passion, belief or commitment to the NHS. On the contrary, I was worried when I read that he tried to remove Danny Boyle’s NHS tribute from the opening ceremony of the Olympic games. He is also one of the co-authors of a right-wing pamphlet entitled “Direct Democracy”. He may remember that pamphlet. It said:

“Our ambition should be to break down the barriers between private and public provision, in effect denationalising the provision of health care in Britain.”

Is that still the Secretary of State’s view? He has gone quiet now, has he not?

You will understand, Mr. Speaker, why NHS supporters get nervous about the intentions of this Secretary of State, but today he has a chance to calm those nerves. He can come to the Dispatch Box and send the clearest of messages to NHS trusts seeking to break from national pay. What he will learn about his job is that, if he says something with sufficient force, the NHS will respond.

The developing pay crisis in the NHS is the Secretary of State’s first real test, but so far he is failing it. As we reveal today, on his watch, the 20 NHS trusts that were threatening to break away in the south-west have become 32 NHS trusts across England. That is creating real worry for thousands of NHS staff and uncertainty for businesses, which have raised their concerns with the Chancellor. But what do we get from the Government today? A “do nothing” amendment expressing no view on the south-west issue, and inviting Government Members to sit on the fence and wait for the conclusions of the pay review body’s review. That will not do.

As the Government do nothing, national pay is being unpicked and the NHS is fragmenting before our eyes, but perhaps that is all part of the plan—it is nothing to do with them; it is all due to a local decision. The idea is to hide behind a review while national pay slowly and conveniently unravels, region by region, trust by trust. Staff facing the threat of a pay cut deserve some straight answers, but rather than getting a straight answer to the question “Does the Secretary of State support regional pay in the NHS or not?”, they are hearing contradictory statements from this shambolic Government. Not for the first time, the coalition is not speaking with one voice. I understand that the Liberal Democrat conference passed a motion opposing regional pay and that the Deputy Prime Minister was captured on film voting for it—although, as we know, being photographed making pledges does not make him more likely to keep them.

The Deputy Prime Minister has also made the following unambiguous statement:

“There is going to be no regional pay system. That is not going to happen.”

The trouble is that it is happening, under the Deputy Prime Minister’s nose and by the back door. Twenty NHS trusts in the south-west are openly defying the authority of the Deputy Prime Minister. Some 88,000 NHS staff are being affected by a unilateral drive to set a new going rate of NHS pay in the regions, which would be up to 15% lower than national “Agenda for Change” rates. The trusts are proposing to end overtime payments for night, weekend and bank holiday working,

7 Nov 2012 : Column 871

and to reduce holiday leave. They are also proposing to force staff to work longer shifts, and to cut sick pay rates drastically. That is no idle threat. The silence from Ministers is clearly emboldening them. Despite concerns raised here and elsewhere, they have built a fighting fund, set up a website, and appointed lawyers to make all this happen.

Mr Ben Bradshaw (Exeter) (Lab): My right hon. Friend may not have been able to catch up with this morning’s Adjournment debate in Westminster Hall, but it is more than “silence from Ministers”. The Under-Secretary of State for Health, the hon. Member for Broxtowe (Anna Soubry), who responded to the debate, admitted that the Department had known about the south-west cartel when it happened, and that she supported it. [Interruption.]

Andy Burnham: This debate is flushing out the Government’s position, is it not? The Under-Secretary of State keeps heckling from the Front Bench, but we now know—[Interruption.]

Mr Speaker: Order. I ask the right hon. Gentleman to resume his seat. [Interruption.] Order. Let me say once and for all to the Under-Secretary of State, the hon. Member for Broxtowe (Anna Soubry), who has been conducting a running commentary since she sat down on the Front Bench at the start of the debate, “Stop it.” I do not wish to hear it, and neither does the House. The Secretary of State will respond in due course. If the hon. Lady is dissatisfied with what has been said, her right hon. Friend will have a chance to respond. I do not want the sedentary chuntering, the finger-wagging and all the rest of it. The hon. Lady can say “pooh” if she wants, but she will accept the ruling of the Chair, and either behave or get out of the Chamber. I do not mind which it is.

Andy Burnham: The Government’s position was indeed made clear in Westminster Hall this morning, and perhaps we shall hear it again from the Dispatch Box in a moment.

The south-west trusts’ initial document stated that the consortium would explore

“radical changes to terms and conditions of the workforce”.

It went on to say that this would not be a negotiation, and that

“trusts would be obliged to dismiss and re-engage staff to secure such changes”.

That is disgraceful, and it is simply not possible for the Government to have no view on it. It is provocative, destabilising and divisive. However, it gets worse. In the vacuum left by Ministers, the chaos is spreading. We have identified a further 12 trusts across England that are actively considering opting out of “Agenda for Change”. There are five in the north-east, which gives rise to fears of a second emerging pay cartel. North Tees and Hartlepool has issued 90-day notices to 5,452 staff as a precursor to forcing them to sign new non-“Agenda for Change” contracts—staff who refuse to sign by March 2013 are threatened with the sack—and South Tees is considering a similar move.

Mr David Anderson (Blaydon) (Lab): Will my hon. Friend give way?

7 Nov 2012 : Column 872

Andy Burnham: I will give way for the last time to my hon. Friend.

Mr Anderson: I support what my right hon. Friend is saying. In the north-east there is real anger among people who have devoted their lives to the health service, and who are now being told that they will effectively be forced to sign new contracts, because otherwise they could face the dole. Is that any way in which to treat people who are relied on to make what are literally life-or-death decisions? It is a disgrace.

Andy Burnham: These are the same staff whom we were celebrating during the Olympic games, just a few months ago, for everything that they contribute to the NHS and to the care of others, but Ministers sit there and do absolutely nothing. It is disgraceful that any staff in the NHS should be treated in such a way.

This is no academic threat. These are the panic moves of an NHS that is experiencing increasing distress, in which control has been lost because it is facing the biggest financial challenge in its history. After the election, the £20 billion Nicholson challenge should have been the only show in town, but the previous Secretary of State was allowed to proceed with his vanity reorganisation of the NHS. Instead of focusing on saving money, the NHS has been busy wasting it: £1.6 billion, and rising. A full £1 billion has been spent on redundancies—1,300 people have received six-figure payouts, and l73 have received more than £200,000—while 6,000 nurses are losing their jobs. That is scandalous.

As unforgiveable is the Conservative party’s repeated inaccurate boast on NHS funding. I checked on the Conservative party website today, and in the “Where we stand” section it says this:

“We have increased the NHS budget in real terms in each of the last two years.”

The Secretary of State for Health (Mr Jeremy Hunt) indicated assent.

Andy Burnham: The Secretary of State nods, because he has made similar statements. I want to know whether he stands by those words as a truthful and accurate statement.

Mr Hunt: Absolutely.

Andy Burnham: He says he does, so let me refer him to table 1.8 of the Treasury’s “Public Expenditure Statistical Analyses 2012”. On NHS spending it shows the following: for 2010-11, a 0.6% real-terms cut; for 2011-12, a 0.1% cut. Those are the facts. How on earth can the Secretary of State say today that he stands by—[Interruption.] The figures are there in black and white. There have been two years of real-terms cuts in the NHS. If anyone does not believe my analysis, a Department of Health press release from July 2012 confirms what I have said:

“PESA figures released today show that in real terms NHS spending has reduced.”

So I ask the Secretary of State this: will he today remove that untrue statement from the Conservative party website? It is giving a false impression of what is happening in the NHS. Perhaps it is designed to give the impression that the drastic moves on pay are a local matter not of Ministers’ making. This is the real picture,

7 Nov 2012 : Column 873

however: the Government have forced the NHS to fund a £1.6 billion reorganisation it did not want—even though they promised that would not happen—from a falling budget which they still claim is increasing.

All trusts have been put in a difficult position by this Government, but that is no excuse for some taking the easy way out by taking it out on staff. If they are allowed to do that, they will damage something that serves the wider good.

The “Agenda for Change” system introduced by the last Government represented a significant step forward, and I want to set out the compelling economic, social and health policy arguments in its favour. First, it brings stability to the service. Unlike other areas of economic activity, health care depends upon certainty and predictability. As an essential emergency service, it needs to be there for people day in, day out. Volatility helps no one. All communities need a full complement of clinical grades and professions. Local or regional pay is not conducive to stable services. If one area starts seeking to poach staff from another, no one wins, as we will get instability and, over time, an inflationary pressure that is hard to control at local level.

That brings me to the second reason in favour of national pay. All the evidence suggests that a national approach to pay and conditions helps to reduce costs and risks to the NHS. Market-based systems tend to cost more, not less.

There is also the hassle and distraction factor of every individual NHS employer or regional group going through the annual process of pay negotiation and setting. Trusts rushing to break away from the national pay system forget that. They are also forgetting the risks of the pre-“Agenda for Change” days, when individual trusts would bear the full legal exposure of failure to implement equal pay legislation. It would seem that there are a few short memories in the NHS. People are forgetting that the advent of a national pay system has insulated the NHS from those risks, which have impacted on other parts of the public sector, such as by bringing more turbulence in recruitment and retention.

I do not think the 32 trusts involved in the breakaway have fully thought through the consequences of their position. For instance, national pay is reflected in the calculation of the tariff under the payment by results system, so are these trusts expecting to be paid at national tariff rates by commissioners while paying staff regional rates? I find it hard to see how that could be justified. So, in effect, they are not only pulling down the system of national pay that helps to give stability for everyone; they will also end up pulling down the national tariff system.

The third health policy reason for national pay is the most compelling. National pay helps with the recruitment of staff in the areas where they are most needed. If we follow through the logic of the argument of proponents of a broken down system of regional or local pay, it will end in a proposal to pay people less in areas where unemployment is highest and wages are lowest. The problem with that argument is that those areas are also the most deprived parts of our country where the health challenges are greatest. It is often much harder to work on the NHS front line in areas of higher health need and deprivation. We need to work hard to attract the

7 Nov 2012 : Column 874

most motivated staff to those areas, and I simply do not see how that will happen if the offer to work in the areas where the pressure is greatest includes being paid 15% less.

In the end, care is a people business and this race-to-the-bottom approach simply does not deliver the quality people are looking for. We have seen that approach in social care: a crude race to the bottom and a cut-price, minimum-wage business. That simply does not work.

It is true that pressures vary from place to place and the job is not the same everywhere, but the principle that a health visitor, a physiotherapist or a midwife should be paid broadly the same for doing a similar job is a good one. It is fair to staff, and we should stick with it.

That brings me on to the fourth reason: the social and economic case. All the evidence points to regional pay in public services causing damage to the regional economies of England. Rather than stimulate the south-west economy, it has been estimated that regional pay would take £140 million out of it.

It is not just the public sector making that argument. Some 60 academics wrote to The Times to say that, and businesses in the north-east have written to the Chancellor raising their concerns. They said:

“Now is the time for the country to unite and focus on growth, not risk a divisive and harmful policy such as this.”

They are right. An NHS with national pay is a one-nation policy. What is happening in the NHS risks cementing the regional divides and creating an unequal Britain.

Taken together, those four reasons stack up a compelling case for keeping a system of national pay in the NHS. Losing it will be bad for the NHS, bad for the economy and bad for society.

I know that the force of that argument is not only felt on the Opposition Benches. Debates such as this one usually divide Members along tribal lines, but there are Members in all parties who represent areas where the jargon of “market-facing pay” means one thing: crude pay cuts for the staff who work so hard to serve their constituents day in, day out. What I find encouraging is that Members on both sides of the House whose constituencies would be affected by these changes have had the courage to speak out against them.

It is not just Liberal Democrat Members who are doing so. I am encouraged by the fact that a number of Conservative Members have expressed serious concerns. The hon. Members for Brigg and Goole (Andrew Percy), for Stafford (Jeremy Lefroy), for Carlisle (John Stevenson) and for Hexham (Guy Opperman) have all spoken out, and I can do no better than repeat the words of the hon. and learned Member for Torridge and West Devon (Mr Cox):

“I am extremely cautious about any change that might further depress incomes in our area or that might act as a disincentive to those in the medical profession to work here.”

The Government Front-Bench team would do well to listen to those concerns, as I suspect they are widely held across this House.

The Government’s amendment does absolutely nothing for the 88,000 NHS staff in the south-west who are worried about the future. It does nothing for the businesses worried about regional divides. It ducks the issue, and lets local and regional pay creep in through the back door. If the Secretary of State has any belief in a

7 Nov 2012 : Column 875

national health service, he must step in tonight, stop the breakaway and uphold the principle of national pay in the NHS. I commend the motion to the House.

1.8 pm

The Secretary of State for Health (Mr Jeremy Hunt): I beg to move an amendment, to leave out from “House” to the end of the Question and add:

“notes that the Agenda for Change pay system, introduced by the previous administration in 2004, already includes regional flexibilities, including high cost area supplements and recruitment and retention premiums; further notes that the previous administration also introduced local pay variation in the courts services; recognises that the previous administration established foundation trusts and in so doing removed the power of the Secretary of State to issue directions to trusts over matters of pay; accepts that the rt. Hon Member for Leigh had the opportunity to change this through legislation when he was Secretary of State but chose not to; looks forward to the publication of the NHS Pay Review Body report on the case for further reform to the pay system; supports the view expressed by the Chief Secretary to the Treasury at the GMB union conference that there will be no change unless there is strong evidence and a rational case for proceeding; and calls on the Government to continue to support employers and trade unions to work together for the benefit of patients and staff.”

What we have just heard is a shocking attempt to talk down the NHS and to misrepresent my views and those of the Government. As a former Secretary of State, the right hon. Member for Leigh (Andy Burnham) should know better.

I am glad, however, that the right hon. Gentleman has called this debate today, as it gives me a good opportunity to sing the praises of NHS staff up and down the country for the brilliant work they are doing. It is work that, contrary to the tone of the right hon. Gentleman’s comments, is delivering an NHS that is performing better than ever despite extremely challenging financial circumstances: an NHS where infection rates are at their lowest levels since the introduction of mandatory surveillance; an NHS where, despite what the right hon. Gentleman and his colleagues would have people believe, the number of patients waiting over 18 weeks is at the lowest ever level; an NHS where, for the first time since “call connect” was introduced, all ambulance trusts are meeting their category A8 performance measure; an NHS with more clinical staff than ever before, including 3,500 more doctors and 900 more midwives; and an NHS where performance measures on accident and emergency, cancer care, dentistry and waiting times are all being met.

Compared with the situation at the last election, we have an NHS treating almost a million more people in accident and emergency, carrying out over half a million more out-patient appointments, and conducting over one and a half million more diagnostic tests. None of that would have been possible if we had introduced the cuts proposed by the right hon. Gentleman at the last election. Instead, despite the huge pressure created by Labour’s deficit, we are actually increasing spending on the NHS by £12.5 billion.

Let me start by saying thank you to the many NHS staff who have made that possible—to more than a million people who work night and day, often in incredibly challenging circumstances. We owe them a debt, which is why the scaremongering we have heard this afternoon from the right hon. Gentleman is inaccurate at best, and downright irresponsible at worst.

7 Nov 2012 : Column 876

Derek Twigg (Halton) (Lab): One way in which the Secretary of State can express his thanks is by ruling out regional pay. Will he tell us now whether he will do so, because it is a major concern for my constituents, who have written to me in their dozens over the past two or three weeks?

Mr Hunt: I am coming on to say exactly what the Government’s approach to regional pay is, so I will address the hon. Gentleman’s comments.

Mr Anderson rose

Mr Hunt: May I just answer the question put by the hon. Member for Halton (Derek Twigg)? Let me make it clear: we are not proposing to abolish “Agenda for Change”; we are not proposing an end to national collective bargaining; we are not proposing the abolition of national pay scales; and current pay scales will not be cut. What we are doing is supporting the changes brought in by the previous Labour Government to ensure there is sensible flexibility in pay across the whole country.

Mr Anderson: The Secretary of State mentioned people working night and day. Does he agree with the agreement in “Agenda for Change” that people should get additional pay for working night shifts, both because such shifts are antisocial and as compensation for not only the impact on family life but the fact that people who work night shifts tend to die earlier?

Mr Hunt: I support the principles behind “Agenda for Change”, which were introduced in 2004 by the Labour Government of which the right hon. Member for Leigh was a member. I also support a number of other flexibilities introduced by the Government—the right hon. Gentleman supported the legislation—in respect of foundation trusts.

Mr Bradshaw: The south-west cartel is not about flexibilities introduced to allow hospitals to attract staff and pay them more, as they in fact did; it is about a regional pay system. The Secretary of State has to decide: is he for or against the south-west cartel? Does he say yes or no?

Mr Hunt: Perhaps the right hon. Gentleman will explain why he voted for the Health and Social Care (Community Health and Standards) Act 2003, which gave foundation trusts the freedom to introduce their own terms and conditions. Until he explains that, which we are simply supporting, I am afraid that his position is extremely tenuous.

Hugh Bayley (York Central) (Lab): The NHS budget is actually going down. It is certainly much more constrained than it was under the previous Government, so if the Secretary of State accelerates the regionalisation of pay, it will presumably fall in low-pay areas such as mine in Yorkshire and rise in the leafy suburbs of Surrey, which he represents. Will the health budget then be transferred from poorer areas in the north of England to the high-pay places in the south?

Mr Hunt: Let me remind the hon. Gentleman that he supported the 2003 Act, which gave foundation trusts the power to set their own terms and conditions. Let me

7 Nov 2012 : Column 877

also remind him that this Government have increased the NHS budget in real terms—something that the right hon. Member for Leigh said was “irresponsible”. Let me say clearly that we are not changing the allocation of resources to different parts of the country, but we are allowing the flexibilities that the Labour Government introduced for local NHS managers to make sure that they get the benefit. If the hon. Member for York Central (Hugh Bayley) listened to what I said about a million more people being treated in accident and emergency, one and a half million more diagnostic tests being carried out, and about half a million more out-patient appointments being dealt with, he would understand that all our constituents are benefiting from that. That is because we have the flexibilities that that Government introduced.

Andy Burnham: The Secretary of State said again that in 2010-11 and 2011-12 the NHS budget increased in real terms. Is he saying that Her Majesty’s Treasury has got its figures wrong?

Mr Hunt: No. Let me just remind the right hon. Gentleman that the budget increase in the NHS that this Government committed to and that this Government announced was something that he said would be “irresponsible”. We have ignored that, and I have been completely clear that the NHS budget went up.

We support recruitment and retention pay—an amount that can be as much as 30% of a person’s salary, and which the Opposition, if they were consistent in their opposition to regional pay, would presumably wish to abolish. We support the London weighting, which is, again, a form of regional pay that we would be planning to abolish if we listened to the Opposition’s arguments today.

Yasmin Qureshi (Bolton South East) (Lab) rose

Mr Hunt: The hon. Lady might want to think about her own constituents before she jumps on that bandwagon. We also support high-cost area supplements. Why should trusts not be able to offer higher packages to lower-paid staff living in expensive areas beyond the capital so that they can live nearer to where they work? If we listened to the Opposition and their trade union sponsors, that, too, would be banned. This Government support the right of local trusts to determine how best to reward their own staff, so they can recruit, retain and motivate the people whom patients rely on every single day. That includes the right of each employer to choose their own terms and conditions or to use national terms and conditions, should they wish.

Yasmin Qureshi: I was not in this House when the earlier legislation and policies were being put through, but the question for today is: will someone working in London be paid the same as someone doing the same work in Bolton? Will the Secretary of State reassure us that the fundamental change to that arrangement will not take place?

Mr Hunt: May I gently remind the hon. Lady that she stood for election on a manifesto that did not include abolishing the 2003 Act or the Health Act 2006, which gave foundation trusts the freedom to set their own pay and conditions? [Interruption.] I ask Labour Members

7 Nov 2012 : Column 878

to let me answer the question. May I also remind her that the previous Government, whom she supported, introduced “Agenda for Change”, which does not pay the same amount throughout the country for the same work? It actually includes a lot of flexibility for regional pay.

Steve McCabe (Birmingham, Selly Oak) (Lab): So far, the Secretary of State is describing what he sees as the benefits of flexibility. I put it to him that if a number of regions adopt the south-west’s approach, he will eventually be confronted by the fact, as the Secretary of State, that the poorest parts of this country will not be able to attract the doctors they need. What will he do then?

Mr Hunt: All we are doing is supporting what the hon. Gentleman’s Government did, which was to introduce flexibilities for the people who run foundation trusts to set pay and conditions in order to get the best health care in their areas, including in his constituency, in that of the right hon. Member for Leigh and in mine. The previous Labour Government did not just support that; they legislated to require it. They introduced foundation trusts—

Andy Burnham rose

Mr Hunt: I am going to make some progress now. The previous Labour Government introduced foundation trusts in 2003, giving them the power to set their own terms and conditions, just like NHS trusts. Indeed that Government went further, removing the remaining powers of the Secretary of State to intervene. Then, in 2004, the right hon. Gentleman’s Government included regional pay as a firm principle of “Agenda for Change”. Then they legislated to confirm these principles in the Health Act 2006. Who was the Health Minister then? It was the right hon. Gentleman.

The right hon. Gentleman recently referred to this flexibility as a “loophole”. It is not a loophole; it was one of the central planks of that Government’s policy. Let us consider the following:

“The challenge now must be to genuinely free the very best NHS hospitals from direct Whitehall control.

We plan to do this…by removing the Secretary of State's powers of direction over NHS Foundation Trusts…

Exercising these freedoms will give NHS Foundation Trusts precisely the sort of autonomy that is commonplace for hospitals elsewhere in Europe.”

Those are not my words, but those of his colleague and former Health Secretary, Alan Milburn, when he introduced foundation trusts.

The question that the right hon. Gentleman has to answer—he has completely failed to do so—is why, as Health Minister, he legislated for these powers if he disagreed with them. If he disagrees with them, why did he not overturn them when he had a chance to do so as Health Secretary? Either he has changed his mind or the unions which bankroll his party have changed it for him. Whichever is the case, it is a pretty sorry state of affairs for a party that claims to aspire to power.

Andy Burnham: The Secretary of State has misrepresented the former Government’s position twice, and on NHS spending. Let me just ask him about regional pay.

7 Nov 2012 : Column 879

He said he is building on what we did. When we left office not a single NHS trust in this country had opted out of the national “Agenda for Change” system—that is a fact—because we defended the principle of national pay. He has just said to my right hon. Friend the Member for Exeter (Mr Bradshaw) that he will not condemn the cartel in the south-west, and that he wants trusts to choose whether to opt in to national pay or regional pay. Should he not tell Liberal Democrat Members and the people sitting behind him that he supports local and regional pay in the NHS?

Mr Hunt: That is a funny way of defending the principle of national pay: legislating to give foundation trusts the ability, for the first time ever, to set their own terms and conditions. I do not know how the right hon. Gentleman defines it, but that does not seem to me to be in any way logical.

Sarah Newton (Truro and Falmouth) (Con): I represent an area with a very high cost of living. Does my right hon. Friend agree that trusts trying to balance their books should not do so at the expense of modestly paid care assistants and nurses?

Mr Hunt: I agree that I want local trusts to have the freedom to get the best health care for people in their areas, including my hon. Friend’s constituents. I agree that that means recruiting and retaining the very best staff and ensuring that they are highly motivated. My hon. Friend makes an important point: we must think about areas where the cost of living is lower, but we must also think about areas where it is higher. People in my constituency who work for the NHS have to commute from Portsmouth because they cannot afford to live near the hospitals and community health centres where they work. That is why an element of flexibility is a very important principle.

Jack Dromey (Birmingham, Erdington) (Lab) rose

Geraint Davies (Swansea West) (Lab/Co-op) rose

Mr Hunt: I want to make a little more progress, and then I will perhaps take one or two more interventions.

NHS employers have the ability to set their own terms and conditions, but the vast majority prefer to use national terms and conditions, and provided that those remain sustainable and fit for purpose, they are likely to continue to do so. I welcome the national negotiations between NHS employers and NHS trade unions, and I urge both sides to bring the negotiations to a swift and successful conclusion. Unfortunately, the time it is taking for agreement to be reached is encouraging some employers, such as those in the south-west consortium of NHS and foundation trusts, to examine alternative provision. Sadly, it appears that the people who bankroll the Opposition—particularly Unite—would rather put their members’ jobs at risk than work with employers to find an acceptable solution to help the NHS meet its financial challenge—[Interruption.] I am sorry they do not want to hear this—

Mr Anderson: On a point of order, Mr Speaker.

7 Nov 2012 : Column 880

Mr Speaker: I hope that it is a point of order rather than a point of frustration. We will hear it and I will discover whether it is.

Mr Anderson: On three occasions, the Secretary of State has said that the trade unions bankroll the Labour party. A large majority of the trade unions in the health service have no links to the Labour party whatsoever.

Mr Speaker: I am grateful to the hon. Gentleman, but that is a point of debate that he might wish to develop further if he is successful in catching my eye. We will leave it for now.

Mr Hunt: I ask the right hon. Member for Leigh, rather than irresponsibly scaremongering, to do something positive by doing everything in his power to encourage his trade union friends to work in the best interests of their members, of patients and of his constituents and mine to come to a speedy resolution. I suspect he has rather more influence with the unions than I do in that regard. Even with a protected NHS budget—something that he thought was “irresponsible”—the NHS must do significantly more within its limited means, and as its single largest expense the pay bill cannot be immune to change. It represents between 60% and 70% of total expenditure in most NHS organisations and costs more than £43 billion in the hospital and community services sector alone.

Jack Dromey: I was involved in the process that led to the groundbreaking agreement “Agenda for Change”. It was a national agreement that contained certain flexibilities but it explicitly rejected regional pay. Regional pay is now proposed in the south-west. Does the Secretary of State support that move or condemn it?

Mr Hunt: I support proper negotiations between NHS employers and unions to revise, reform and improve “Agenda for Change” so that it is fit for the very different financial circumstances in which the NHS now finds itself. The vast majority of NHS trusts and foundation trusts, including in the south-west, would rather negotiate on national pay scales, but that means the unions being realistic about what is sensible in this financial climate. That is why employers need to use the system more efficiently and effectively, extending the use of high-cost area supplements when they can be justified to tackle the recruitment and retention issues that affect a particular area or region.

Like the previous Government, we want to retain the flexibility that allows individual employers to use recruitment and retention premiums and, like the previous Government, we want any changes to be introduced incrementally in full partnership with NHS employers and trade unions.

Mr Bradshaw: Will the Secretary of State give way?

Mr Hunt: I have already given way to the right hon. Gentleman once.

The greatest risk to national terms and conditions is that they will become rigid, inflexible and no longer fit for purpose. If that happens, employers will be more likely to use the freedoms given to them by Labour to

7 Nov 2012 : Column 881

abandon “Agenda for Change”, which was where those freedoms came from, and introduce local terms and conditions.

The Opposition has a clear choice. They can wolf whistle to their trade union sponsors in a hollow attempt to distance themselves from legislation that they passed, or they can prioritise the interests of low-paid NHS employees by encouraging the unions to work for constructive, negotiated improvements to “Agenda for Change”. Sadly, this afternoon’s debate shows that they have made that choice—the motion is nothing more than a shameless attempt to frighten the hard-working staff of the NHS.

The debate is scandalous scaremongering from a party that did more to introduce regional pay during its time in office than any other Government in history and outrageous opportunism from a party that wanted to cut the NHS budget. Rather than singing to the tune of their trade union paymasters, the Opposition should be telling them to get around the table and negotiate seriously on “Agenda for Change”; rather than scaring NHS employees, the Opposition should be celebrating their achievements; and rather than talking down the NHS, the Opposition should, painful though it is, be celebrating the achievements of a Government who have delivered record NHS performance. I urge my colleagues to support the amendment.

Several hon. Members rose—

Mr Speaker: Order. In the interests of trying to accommodate as many colleagues as possible, and many wish to speak in the debate, I have imposed an eight-minute limit on each Back-Bench contribution with immediate effect. I call Mr Ben Bradshaw.

Mr Bradshaw indicated dissent.

Mr Speaker: The right hon. Gentleman had previously expressed an interest.

Mr Bradshaw: That is very kind of you, Mr Speaker, but I have had my Adjournment debate this morning and taken up enough time, so I want to let colleagues speak.

Mr Speaker: We are extremely grateful to the right hon. Gentleman for his selfless sacrifice. I call Kerry McCarthy.

1.27 pm

Kerry McCarthy (Bristol East) (Lab): I, too, was in the Westminster Hall debate this morning and I congratulate my right hon. Friend the Member for Exeter (Mr Bradshaw) on securing it.

As we have heard, regional pay would damage our economy and the NHS. As the shadow Secretary of State said, 60 senior academics have written to The Times to warn the Chancellor that there is “no convincing evidence” to support his claims on the benefits of regional pay and that

“On the contrary, such a policy could reduce spending power, undermine many small and medium-sized businesses in areas of low pay, and aggravate geographical economic and social inequalities.”

7 Nov 2012 : Column 882

According to research by the New Economics Foundation, the Government’s evidence of an alleged public sector pay premium

“suffers from a number of serious shortcomings”

and their statements are

“at best misconceived, at worst mischievous and ideologically driven.”

It concludes that regional pay would cost our economy £2.7 billion at best—if the private sector expanded where the public sector contracted—but that the cost could be up to £9.7 billion each year, with the loss of 110,000 jobs. Regional pay would reduce spending power in the south-west by £1.2 billion.

When we consider regional pay from the perspective of the NHS, we cannot, or at least should not, talk about private sector jobs replacing public sector jobs. The public’s response to the Government’s disastrous reorganisation of our NHS proved that patients do not want to be treated by Virgin Care or Serco, but Ministers still seem determined to remove the N from NHS.

For my constituents, today’s debate is even more important because, as we have heard, trusts in our region have been developing the NHS south-west pay, terms and conditions consortium. This morning, I asked the Under-Secretary of State for Health, the hon. Member for Broxtowe (Anna Soubry)whether the Government knew about the consortium before it was established and whether they encouraged the trusts to set it up, and it was interesting that she said, “My understanding is we were involved”—[Interruption.]

Alison Seabeck (Plymouth, Moor View) (Lab): That is a fascinating answer because it is at odds with the one I received from the Secretary of State during Health questions.

Kerry McCarthy: I very much hope that when the Government—[Interruption.]

Mr Speaker: Order. Let me say to the Minister once and for all—[Interruption.] No. I say to the Under-Secretary of State for Health, the hon. Member for Broxtowe (Anna Soubry)—perhaps she will have the courtesy to listen when she is being spoken to from the Chair—that it is not acceptable for any Member of the House to treat the debate as a private conversation between himself or herself and the Member on his or her feet. If the Minister is dissatisfied with what is being said, other people on her Benches can pick up those points. It is totally unacceptable to behave in this way and it will stop straight away. I hope the Whip has noticed it, and I will be speaking to others about the matter.

Kerry McCarthy: There is some confusion. When I wrote to the Health Secretary to get some clarity—

Ian Mearns (Gateshead) (Lab): On a point of order, Mr Speaker. I could not help but notice that the clock did not stop during that intervention. I see that a minute has been added on, but I think it should have been more than that.

Mr Speaker: Allowance will be made. I am grateful to the hon. Gentleman for his service. Perhaps we can now proceed with the debate in an orderly way.

7 Nov 2012 : Column 883

Kerry McCarthy: I shall try to move on. When I wrote to the Health Secretary, the response I got back was very ambiguous. It referred mysteriously to when the document was first leaked to the public, rather than saying what the Government were aware of in relation to the consortium.

In the debate earlier today, the Minister definitely said the words, “Yes, we were.” The civil servant behind her was shaking his head and saying, “No, we weren’t. No, we weren’t,” so I hope that we get some clarity on the matter and a firm answer when the Government respond to this debate. To what extent did they know about and encourage the south-west consortium to start?

The consortium, as I indicated, was initially developed in secret but since NHS staff found out about it by accident, I have received hundreds of letters and e-mails from staff who are angry and anxious not just for their own futures, but for their patients. It is shocking that they found out about that only by accident and were not consulted by the consortium.

Yasmin Qureshi: Does my hon. Friend agree that we were a bit surprised to hear the Secretary of State say that Labour is asking for national pay and opposing regional pay because the unions are bankrolling us? My hon. Friend said that she had received many e-mails. I am sure that, like me, other Opposition Members have received hundreds of e-mails from people who work in the health service—ordinary people, working people—who say that they do not want regional pay. That has nothing to do with any union.

Mr Speaker: Order. Interventions on both sides should be brief, and rather briefer than that.

Kerry McCarthy: It is sad that the Secretary of State resorted to the union bashing that we also heard from the Minister in the Westminster Hall debate. I have had a meeting with the Royal College of Nursing, and I have a briefing from the BMA about the case against the local and regional approach to pay. That has nothing to do with Labour-affiliated unions. Those organisations are speaking up for their staff, who are extremely worried. It is patronising to say that staff are concerned only because someone stoked them up and told them falsehoods or whatever. They are worried about the proposal because they work in the NHS and they know what impact it will have on them.

The south-west consortium’s explicit intention is to reduce costs by considering