Geoffrey Clifton-Brown (The Cotswolds) (Con):
Mr Speaker, you and the House may be interested to know that I have a plaque on my wall, signed by my great uncle when he was Speaker, commemorating the gift of a silver ashtray from the peoples and Government of the Falklands on the rebuilding of this Chamber after it had been bombed during the war. Does that not demonstrate the deep and enduring friendship between
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our two peoples, and does not my right hon. Friend’s statement this morning demonstrate to the Russians, Argentines and anyone else that if our interests are threatened throughout the world, we will respond?
Michael Fallon: I am grateful to my hon. Friend for the terms in which he put that declaration, and I hope there is no doubt about our determination to stand up to any kind of intimidation or threat to our territory or the rights of those who want to remain British. I hope the message that will go out from across the House today is that we respect the right of the islanders in the decision they have taken to remain British.
Henry Smith (Crawley) (Con): I welcome my right hon. Friend’s commitment to the defence of the self-determination of British overseas territories such as the Falkland Islands. Does that prove that Her Majesty’s Government were right to develop the new airport on Saint Helena as an important air bridge to the south Atlantic?
Michael Fallon: My hon. Friend is right: it was important to take that decision and to reinforce the links between Saint Helena and the United Kingdom. The commitment of expenditure on the Mount Pleasant airfield enables us to reinforce the islands remarkably quickly should any threat materialise.
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Cyber-security
1.43 pm
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude): With permission, Mr Speaker, I will make a statement on the Government’s national cyber-security programme.
Every day, the cyber threat is growing and we face ever more sophisticated attacks. According to one survey, 81% of large businesses and 60% of small businesses suffered a breach last year. Back in 2010 the coalition Government identified cyber as one of four tier 1 national security threats, and Britain has been among the fastest adopters of the digital economy. We are a world leader in digital services, which are a key part of our long-term economic plan. We cannot let our economic progress be undermined by those who would do us harm. No national Government can tackle the cyber threat alone, and international collaboration is central to our strategy, as is the closest partnership with the business community.
In 2011 we published our cyber-security strategy and have committed £860 million of funding over five years to the national cyber-security programme. That is to ensure that Britain remains one of the safest places to do business online. Cyber-security skills are scarce, and collaboration between Government, industry and academia is essential to build the skills and expertise we need.
Despite the huge budget deficit that we inherited, we have invested in our intelligence agencies and the National Crime Agency to build our capabilities to understand cyber threats and tackle cybercrime. GCHQ—often the object of poorly informed criticism—is home to a hugely impressive and patriotic collection of public servants, and I put on record my appreciation for the dedicated and highly skilled work they do to keep Britain safe.
We have worked with business to establish the cyber essentials scheme to raise awareness of five basic measures to keep companies safe. That scheme is now mandatory for certain types of Government procurement, and today 88% of FTSE 350 companies have cyber-security firmly on their risk registers. We created the national computer emergency response team—CERT-UK—to respond to major cyber incidents, and it played a significant role in protecting the Commonwealth games and the NATO summit in Wales. Following the Prime Minister’s successful visit to the US, CERT-UK will be leading joint exercising with its American counterpart later this year. The cyber-security information sharing partnership, based within CERT-UK, provides a safe space for businesses and Government to exchange information and develop responses in real time. CiSP now has 914 members and reports on 215,000 abused IP addresses daily.
Technology moves at an astonishing pace and we cannot stand still. Today I will set out further steps to keep us safe. Our new Cyber First scheme will be an elite development programme for the next generation of UK cyber-security talent. It draws heavily on Israel’s hugely successful Talpiot programme, which I saw first-hand on a visit to Israel in November. Talpiot provides the state of Israel with formidable cyber-security skills, and is also the seedbed for a fertile array of new businesses. Partly as a result, Israel now has more start-ups per capita than any other country.
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Initially we will pilot Cyber First with a few tens of students. Each will receive £4,000 funding per year to study relevant undergraduate courses in science, technology, engineering and maths. They will be required to work during summer vacations or years out, either within government or in leading UK cyber-security companies. Participation in this elite programme will carry a commitment to work for the Government for at least three years before members start to see their financial support written down. This programme will be a vital pipeline of top-end cyber talent in the service of Britain’s national security.
Cyber First is the latest in a series of initiatives building cyber skills, including new apprenticeships, and introducing cyber-security to the National Citizen Service and ensuring that it is included in relevant courses leading to computing and digital qualifications for 16 to 19-year-olds. We sponsor cyber competitions in schools, as well as technical apprenticeships and PhDs; we are building cyber-security into computer science and computing degrees, and so far we have accredited six master’s degrees in cyber-security, created two new centres of doctoral training, three research institutes and 11 academic centres of excellence in cyber-security research. Two further universities—Kent and Surrey—have today been awarded centre of excellence status in cyber research. I can also announce the funding of three UK-Israel cyber research projects. Similar projects with Singapore will follow later this year, and I look forward to seeing the first cohort of joint UK-US Fulbright cyber-security scholars before too long.
All that builds on our much broader work to improve cyber skills, which has already seen 40,000 people enrol in the Open University cyber-security open online course. We have made good progress in developing digital and cyber skills more widely across the economy, and I warmly commend the work that my hon. Friend the Minister for Culture and the Digital Economy has done and continues to do on that.
For Government services, online safety is central. Gov.uk Verify, funded by the national cyber-security programme, is our world-leading identity assurance programme. I can announce today that we have put in place a new contractual framework for identity providers that will increase choice for citizens who wish to prove their identity online. I will announce shortly the details of the additional identity providers.
We have to worry about cyber-security because of the growth and development of the internet in the past 20 years. The internet has an amazing power to change people’s lives for the better. Cyber is a huge opportunity, as well as a threat. Britain’s cyber-security sector is worth more than £6 billion a year and employs some 40,000 people. We are on track to double cyber-security exports to £2 billion by next year. Our aim is to increase that to £4 billion by 2020, and we will promote more regional clusters to support more British cyber-businesses. We want Britain to benefit from the best digital economy in the world. Effective cyber-security is central to that success. I commend this statement to the House.
1.50 pm
Chi Onwurah (Newcastle upon Tyne Central) (Lab):
I thank the Minister for advance sight of his statement. It is now twice in two days that he has come to the House
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to make a statement. Tomorrow he will make it a hat-trick with his final Cabinet Office Questions. Clearly, he wants to see as much of us all as possible before he retires from this House.
I pay tribute to the Minister for his work in the past five years as the Minister for the Cabinet Office and in the many years he has served the public as a Member of this House. There are many things on which we disagree, for example how we should use digital government to empower people rather than cutting them off from services, but no one can doubt his dedication to public service. Nor can we doubt the dedication of those who work so hard to protect us, our nation, its citizens and businesses from cyber-attacks. I, too, would like to put on record my praise for the work done by the security services, the police and all civil servants who work in this area. They do a vital job day in, day out to protect our cyber-infrastructure and digital footprints, and I commend their work.
I am sure the Minister agrees with that sentiment. I hope, therefore, that the Government will clarify how those who protect us in cyberspace will continue to do so when the Chancellor is bent on reducing public sector spending to levels not seen since the 1930s, before there was even an NHS or a GCHQ. It is clear from the Office for Budget Responsibility and the Institute for Fiscal Studies that, after the Chancellor’s Budget last week, unprotected Departments face huge cuts to meet his spending plans and unfunded tax cuts. The Ministry of Defence, the police and social care services are under threat. Can the Minister confirm whether the budget for cyber-security will be protected, or are we to assume that because the Cabinet Office is an unprotected Department that this will not be the case?
I welcome the new Cyber First pilot. Indeed, I was privileged to launch the UK’s first MBA in cyber-security with Coventry university. The demand for cyber-security experts is growing at 12 times the rate of the overall job market, so it is vital that we train and equip more people with cyber-skills. Small firms are the victims of three quarters of all successful data breaches and are the most likely to suffer from a lack of cyber-skills. However, just as the Minister came late to the digital inclusion agenda and then chose a strategy that excludes 10% of our fellow citizens, he has come late to—indeed, neglected—cyber-security for small businesses. According to the Institution of Engineering and Technology, half of all small and medium-sized enterprises have not even heard of the Government’s cyber-security efforts. What is the Minister doing to change that and to make small businesses more cyber-aware?
Crime is changing. It increasingly happens online, but the Government do not have a strategy to tackle it. The cyber-security budget is overwhelmingly going to cyber-security and big businesses, leaving consumers to fend for themselves. The majority of the cyber-security budget goes into the single intelligence account, with the police left a tiny amount to tackle a growing tide of online crime with an overall £2 billion cut in funding. The Home Affairs Committee highlighted the black hole where low-level e-crime is committed with impunity. What is the Minister doing to ensure that the police have the resources they need in this area?
I welcome the announcement of a new contractual framework for Gov.uk Verify. However, it was only in October that the Government were predicting that hundreds of thousands would be verified by now. In fact, only
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50% of people are successful the first time they use the service. The Minister says that details will be announced “shortly”. Given that there are only a few days left before Parliament is dissolved, will he tell us exactly when he plans to announce the details? Specifically, will it include a public sector provider of identity assurance, so that people can choose a provider they trust?
Finally, the statement makes no mention whatever of mobile. It has taken the Government five years not to eradicate not spots, and they have ignored the gaping hole in cyber-security which is mobile device security, particularly in the era of “bring your own” device. What is the Minister doing specifically on mobile?
I could not help but notice that the statement was somewhat light on actual policy announcements. A cynic might think that the Minister was rushing out a half-baked announcement to use up time. It is almost as if the Government are scrambling around for something to say to give the impression that they have made real progress in rising to what is one of the greatest challenges of the digital era and one of the greatest opportunities for UK business. The UK can lead in cyber-security as we do in online commerce, but it will take skills for the many—small businesses and citizens, as well as big businesses—not the few. It will take a Labour Government to ensure we have that.
Mr Maude: I am extremely grateful to the hon. Lady for her very warm words at the beginning of her response, which I enormously appreciate. Parting is indeed such sweet sorrow, but there is life beyond.
I am afraid it tailed off a little bit after that. The hon. Lady talked about cuts and the potential for continued funding for cyber-security in the next Parliament. She made the slightly odd suggestion that the trajectory of public spending would be at a level last seen in the 1930s. A little further research shows that the last time this level of spending was seen was in 1999-2000 under a Labour Government.
So far as funding for cyber-security is concerned, that will be dealt with in the context of the spending review that will take place after the election, but I do not know anybody who believes there is any possibility that there will not continue to be very significant funding for cyber-security. We are acknowledged across the world as being in the lead in this area. There is always a danger when one says that of being thought to be complacent. We are not remotely complacent. This is a very fast-moving set of threats and we have to move equally fast to keep up with it. We need to be on the case all the time.
The hon. Lady talked about the resources being devoted to tackling cybercrime. The Under-Secretary of State for the Home Department, my hon. Friend the Member for Staffordshire Moorlands (Karen Bradley) who has responsibility for tackling cybercrime is in her place on the Front Bench. She takes this matter immensely seriously. The national cyber crime unit is based in the National Crime Agency. A good proportion of the cyber-security programme is funding for the law enforcement agencies, which do fantastic work. I obviously echo her enthusiastic support for those who work to protect and preserve our national security, and I include in that those in our armed forces active in this field.
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The hon. Lady talked about digital inclusion, which she knows the Government take extremely seriously. We support the huge amount of work being done by businesses, particularly Barclays and other companies, on digital activity to enable people currently excluded to be active online, and that will continue to be the case. She also asked about mobile security on mobile devices, which is obviously a serious matter. So far as the Government are concerned, CESG, part of GCHQ, provides good guidance and is reckoned to be world leading on smart devices.
So far as citizens and consumers are concerned, she will be aware of our Cyber Streetwise campaign and Get Safe Online, which are about making sure people know the risks. GCHQ estimates that 80% of successful cyber-attacks could be thwarted or mitigated by basic internet hygiene, and for that awareness is important. I am less concerned about whether SMEs are aware of what the Government are doing; I am more concerned that they are aware of what they need to do, which is to take basic steps on internet hygiene.
There is much more to do, and there will never be any scope for a Government or businesses to rest on their laurels. I found the hon. Lady’s objection that my statement was light on policy slightly startling. Quite rightly, the Government have elevated cyber-security to one of the four tier 1 national security threats, so we take it enormously seriously. At a time when we had to cut public spending, because of the appalling public deficit inherited from the last Government, this was one of the very few areas that we decided was sufficiently important to invest further money in, and we will continue to do that.
Dr Julian Lewis (New Forest East) (Con): A number of Governments are known to have invested heavily in what might be termed “offensive cyber”. Given that we must do everything we can to protect our own systems, are there any messages we can send to such Governments about the consequences that would follow for them if they were unwise enough to launch a cyber-attack against this country?
Mr Maude: I am well aware of what my right hon. Friend says, and he is right to raise the matter. Our task is to ensure that our efforts on national security are provided with all the tools necessary for us to protect ourselves and deter attacks.
Jim Shannon (Strangford) (DUP): One of the aims of the 2011 cyber-security strategy was to have the UK more resilient to cyber-attacks and able to protect our interests in cyberspace. How well does the Minister feel that this has been achieved, and how does the news that 81% of firms suffered from cyber-attacks and breaches in the last year, as he said in his introduction, fit with that strategy?
Mr Maude: Awareness in the business world is much higher than it was—it was woefully low and remains so in most parts of the world—partly as a result of the Government’s efforts. As a result, many more companies are taking active steps to treat this seriously—not as something to be delegated to the IT department but as a board-level risk to be understood and managed by the board as a major risk to the business. We shall continue to drive home this message.
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Mr Robin Walker (Worcester) (Con): I congratulate my right hon. Friend on this important update. He talked about clusters. He will know that one of the most important cyber-security clusters in the UK is in world-class Worcestershire. One business he has visited there, Titania security, told me it was benefiting from a wide range of Government help, including the apprenticeships scheme, research and development tax credits and help with exporting from UK Trade & Investment. Will he update the House on how his Department could work with the Department for Business, Innovation and Skills to ensure that our cyber-security industry is the most competitive in the world?
Mr Maude: It is very competitive. I know that my hon. Friend has given enormous support to the cyber-cluster in Worcestershire. As a matter of historical accident almost, there are many such businesses in Great Malvern. When I visited in 2012, there were 40 or so cyber-companies; there are now more than 80. This is very fast growing. We help cyber-companies with exporting, and many of them are doing it. I visited Titania, in his constituency, and was hugely impressed by how many countries this relatively small company was selling its products to.
Mr Frank Roy (Motherwell and Wishaw) (Lab): Cyber-security is a reserved matter, but will the Minister update the House on any conversations or meetings he has had with Police Scotland or the Scottish Government on this matter?
Mr Maude: We obviously co-ordinate as much as possible with the Scottish Government—my hon. Friend the Minister with responsibility for cybercrime could comment separately on any discussions the Home Office has with Police Scotland. The hon. Gentleman is right to imply that these matters require close co-ordination between Governments and law-enforcement agencies not just within the UK but much more widely, because cyber and the internet know no national boundaries.
Alec Shelbrooke (Elmet and Rothwell) (Con): Following on from my right hon. Gentleman’s comments about GCHQ staff, what did he make of the Business Secretary’s comments that The Guardian Snowden publication was entirely correct and courageous, and will he outline his assessment of the effect that has had on the morale of our public servants at GCHQ?
Mr Maude: I happened to be visiting GCHQ shortly after my right hon. Friend made those remarks. The people who work at GCHQ do fantastic work—it is a centre of brilliant expertise and knowledge; they do difficult work away from the public gaze, and any comments that seem to undermine what they do in the service of national security have to be strongly deprecated.
Dr Julian Huppert (Cambridge) (LD): The Minister is right to pay tribute to the work of GCHQ and to prioritise cyber-security, which is very important for all of us. He will be aware that a fundamental part of that is good encryption, so will he encourage individuals and companies alike to push ahead with strong end-to-end encryption, wherever possible?
Mr Maude:
Encryption is obviously important, but it is for businesses to decide what level of encryption they
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want to operate. These are obviously delicate matters, but there is a lot of technology here, and I am happy to say that Britain is very good at it.
Chloe Smith (Norwich North) (Con): It has been an enormous privilege in this Parliament for me to serve with my right hon. Friend in his team at the Cabinet Office doing exactly this work. Will he update the House further on what he continues to do to keep our critical national infrastructure safe?
Mr Maude: I am hugely grateful to my hon. Friend both for what she says and for the incredibly important work she did, particularly in taking the message about the need to strengthen cyber-security defences out to the business community, which she did with her characteristic energy and clarity. So far as the critical national infrastructure is concerned, a huge amount of work is already under way to continue to ensure that we understand the vulnerabilities. Obviously, the critical national infrastructure is not primarily owned by the state—it is in private sector hands—so we need to understand the vulnerabilities and work with the owners of that infrastructure to ensure that the defences are as good as they can be.
Andrew Stephenson (Pendle) (Con): I thank my right hon. Friend for agreeing to meet Training 2000 and me last October to discuss its plans to create an institute for cyber-security in Pendle. Following that meeting, it has followed up the leads he provided, and I am delighted to say that it is now progressing with its ambitious plans to create the institute later this year, to improve local cyber-skills and apprenticeships in the area. Given the importance of this issue to many Lancashire SMEs, what more can his Department do to support such proposals?
Mr Maude: Let me first pay tribute to the work my hon. Friend has done in this area. When I recently visited Pendle, I had the opportunity to discuss the matter with him. There has been no stronger champion of our potential to work with businesses to build the companies, the skills and the kind of centres for training that he mentions. I am confident that he will be in a position to take this work forward over the coming five years.
Neil Carmichael (Stroud) (Con): Does the Paymaster General agree that the excellent news about a new university technical college at Berkeley Green in my constituency, providing skills and training in cyber, is perfectly timely in view of his statement and that it is likely to bring a real benefit to the Government Communications Headquarters?
Mr Maude: My hon. Friend is exactly right to draw attention to that. We need to build these skills—and build them early. The kind of college he mentions can play an incredibly important role in that, particularly, as he says, in view of its proximity to Cheltenham and GCHQ. We need to get to children earlier so that we can encourage more of them to specialise in these subjects. Under our Cyber First scheme, which I referred to in my statement, and in pursuit of the most gifted students, we will absolutely look to find really gifted students at a much younger age.
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Stephen Mosley (City of Chester) (Con): I welcome yesterday’s launch by the Cabinet Office of the report into cyber-insurance, which hopes to make the UK the world capital of cyber-insurance in the marketplace. It will not only give the UK insurance market the leading edge in order to become the world leader, but will encourage our small and medium-sized enterprises to take up cyber-insurance through the terms and conditions of their insurance policy.
Mr Maude: My hon. Friend is absolutely right to draw attention to this. We have, I think, got ahead of the game by commissioning the work we have done jointly with the insurance industry. Cyber-insurance is a market in its infancy. Many businesses do not know whether they are covered for damage and loss caused by cyber-attacks. The fact that Britain excels in the insurance market—London is the world’s centre of insurance—and that Britain is very good at cyber-security will enable us to become world leaders in this important area. The sophisticated pricing of cyber-risk will be a huge stimulus, particularly to smaller businesses, to ensure that they have done what they can to protect themselves. I welcome the industry’s support, particularly for smaller businesses and SMEs, of the Cyber Essentials scheme as a kitemark for taking the right steps to protect themselves.
Richard Graham (Gloucester) (Con) rose—
Madam Deputy Speaker (Mrs Eleanor Laing): The prize for patience goes to Mr Richard Graham.
Richard Graham: Thank you, Madam Deputy Speaker.
I congratulate the Minister for the Cabinet Office on both his statement and his strong commitment to a quiet revolution on our nation’s understanding of, and support for, the cyber-industry. My right hon. Friend knows the important cluster in Worcestershire and Gloucestershire, which now includes the future training centre rightly mentioned by my hon. Friend the Member for Stroud (Neil Carmichael). Does my right hon. Friend agree that places such as the new cyber-centre in Gloucester, led by Raytheon with innovative partners employing between 9,000 and 90,000 employees, should encourage local universities such as the university of Gloucestershire to play an important role in developing appropriate courses for future skills in this sector?
Mr Maude: My hon. Friend is completely right to draw attention to that and to emphasise the need for us to develop these skills early. These are scarce skills at the moment, but they do not need to be. We took steps early in the course of the coalition Government to start the process of building skills, and the kind of developments to which my hon. Friend refers are a crucial part of that.
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Point of Order
2.14 pm
Mary Macleod (Brentford and Isleworth) (Con): On a point of order, Madam Deputy Speaker. Can you clarify the process that exists for a situation in which the hon. Member for Hayes and Harlington (John McDonnell) refuses to apologise to the Minister for Employment, my right hon. Friend the Member for Wirral West (Esther McVey) for quoting someone who referred to her by saying, “Lynch the bastard”. If the hon. Gentleman did not agree with remarks made by others that were in effect inciting violence against a female MP, why on earth did he repeat them to another audience? I had hoped that he would apologise before this House dissolves, but no apology has been forthcoming.
Madam Deputy Speaker (Mrs Eleanor Laing): I call Mr John McDonnell to respond to that point of order.
John McDonnell (Hayes and Harlington) (Lab): This has been raised before, Madam Deputy Speaker, and it was accepted by the House that I would in no way ever encourage violence or support violence against an hon. Member— [Interruption.]
John McDonnell: I therefore have nothing to apologise for. If a constituent shouts something out to an MP, that is a matter for the constituent. This is about the right hon. Member for Wirral West (Esther McVey) trying to make herself into a victim over this issue. The real victims are people such as David Clapson who starved to death as a result of—
Madam Deputy Speaker: Order. If the hon. Gentleman is responding to a point of order, I must insist that he sticks only to that point of order. Has he finished his response to this point of order? He may do so.
John McDonnell: I was simply putting it in the context of the suffering that has been caused by the right hon. Member for Wirral West—
Madam Deputy Speaker: Order. I have said to the hon. Gentleman that he must limit his remarks to the substance of the point of order. I am allowing him to do so and giving him plenty of opportunity to respond. We do not need the background information—just his response.
John McDonnell: The substance of the matter is that there is nothing to apologise for, and I hope that on 7 May the electorate will remove the stain of inhumanity—
Madam Deputy Speaker: Order. It is not a matter for me to discuss the electorate on 7 May. It is disappointing that a matter such as this should have to come before the House. I thank the hon. Member for Brentford and Isleworth (Mary Macleod) and the hon. Member for Hayes and Harlington (John McDonnell) for giving notice of their intention to be here today to raise this point. Let me repeat what the Deputy Speaker said when the matter was raised in November—that what hon. Members say outside this place is not a matter for the Chair.
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I would, however, strongly clarify—the hon. Lady asked for clarification—that it is incumbent on all Members of this House, either within the Chamber or elsewhere, to act with courtesy to one another and, indeed, to everyone else whom they might encounter. I understand the hon. Lady’s particular concerns about reported comments suggesting violence—whether they were seriously intentioned or not. I am quite certain, and I am sure the whole House will agree, that no hon. Member would wish to be associated with such comments. I urge hon. Members concerned in this matter to consider that apology is not backing down; it is a courteous way of settling a matter. One would hope that hon. Members of this House would wish always to act with such courtesy.
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Schools (Opportunity to Study for Qualifications)
Motion for leave to bring in a Bill (Standing Order No. 23)
2.18 pm
Chris Skidmore (Kingswood) (Con): I beg to move,
That leave be given to bring in a Bill to require the Secretary of State to ensure that pupils in secondary education are guaranteed the opportunity to study for qualifications including triple science GCSEs and all English Baccalaureate GCSE subjects; and for connected purposes.
The past five years have witnessed a transformation in the uptake of rigorous subjects at GCSE. It cannot be denied that the introduction of the English baccalaureate as a measure of performance has seen the percentage of pupils studying for English, maths, science, a modern foreign language and either history or geography rise from 22% in 2009-10 to 36% in 2013-14—and it is expected to rise above 40% this academic year.
This is welcome news, for we know that in an increasingly competitive and outward-facing global world, qualifications matter. Even at 14, the choices that a pupil makes in choosing their GCSE options will have a critical impact on their future. Universities now take GCSE results and the subjects studied into close account, while the choice of certain GCSEs can have a limiting effect on a pupil’s ability to study certain subjects at A-level, which in turn can prevent access to the study of these subjects at university. Options at 14 are, in fact, a seismic moment in a pupil’s education, one on which their entire academic future and career may depend.
Given how important the choice of GCSEs has become, and given the weight that is placed on them, one would expect that all pupils, regardless of where they were born, would—in today’s world—be given equal opportunities to study for qualifications that would decide their own future career paths. If pupils’ options are to be meaningful, they must also be given an equal and fair choice of subjects that is open to all. It is unacceptable that the subject choices and, as a result, the aspirations of many pupils are still being capped by a lack of subject provision in the schools that they attend. For many pupils, GCSE choices are little more than a modern-day Hobson’s choice: they are forced either to study certain subjects that their schools have deemed appropriate, or to study nothing at all.
That is particularly true of the uptake of sciences at GCSE. For too long, a great educational divide existed between schools that offered only what was then called double science, and schools that gave their pupils a chance to study the three separate sciences—biology, chemistry and physics. For too long, that chance was mostly the preserve of pupils who were educated in the private or selective sectors, while those attending comprehensive schools were forced to accept second best. Over the past 10 years, rapid progress has been made in the raising of aspirations in every school. In 2004, fewer than 40% of secondary schools offered the three separate sciences, or triple science, at GCSE, whereas recently 87.5% of schools entered pupils for triple science. In 2010, the figure was 78.2%.
Important work has been undertaken through schemes such as the triple science support programme, managed by myScience, which has helped 1,385 schools to increase
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provision of the three sciences. Following the creation of a national network of science learning centres which prepare teachers and technicians to meet the challenge of providing the delivery of triple science, the number of pupils in state-funded schools taking triple science has increased by more than 45,500 since 2010. Across the country, there have been individual success stories of schools that have transformed their science provision. John Smeaton Academy, for instance, initially only allowed its pupils to study science through a BTEC course, but some are now studying three separate sciences.
Last month, however, the publication of the Open Public Services Network’s “Lack of Options” report underlined the challenge that we still face in aiming to ensure that all pupils, regardless of where they live or what school they attend, are given equal opportunities to study for the qualifications that may secure their future. The report found that in just 41 of 149 local authorities did every school give pupils a chance to study the three separate sciences. The variation was stark: in Sutton, 46% of pupils had chosen to enter triple science GCSE, compared with just 14% in Hull and a pitiful 11% in Knowsley, where, worryingly, only 51% of pupils took any kind of science GCSE
Although the report’s conclusions suggested that there was a strong correlation between areas of deprivation and the provision of triple science GCSE, it is important to note that a pupil’s own economic family background did not necessarily act as a barrier to attainment. In Hammersmith and Fulham, the proportion of pupils who were eligible for free school meals was similar to that in Knowsley—47%, compared with 51%—but 37% of pupils were entered for triple science, compared with 11% in Knowsley. The real difference between those two authorities, however, involved the provision of triple science GCSE in schools. In 43% of schools in Knowsley, not a single pupil was entered for triple science GCSE, whereas every school in Hammersmith and Fulham offered the three separate sciences.
Poverty of aspiration, which lowers horizons and dims lights that should be burning brightly, still reaches into areas of our education system, and into places where education is most needed to transform young lives. We cannot continue to allow generation after generation of pupils to be let down simply because of the accident of where they were born or what school they attend. In Bristol, my own local area, only 23.3% of pupils were entered for triple science GCSE. A quarter of schools did not even offer the subject at GCSE. Every single school did so in South Gloucestershire, North Somerset, and Bath and North East Somerset. That contrast is simply unacceptable.
As a local MP, like many other Members to whom I have spoken, I have dealt with casework involving this issue. A pupil whose ambition and aspirations were still burning wished to study the three separate sciences at GCSE, with a view to studying medicine at university. She was informed by the school—which called itself a specialist science school—that she would not be able to do so. After her parents visited my surgery, I investigated the case, under the impression that, in 2008, the previous Government’s science and innovation investment framework had entitled all pupils who achieved a level 6 or above at key stage 3 to study triple science at GCSE. When I
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contacted the science, engineering and design and technology team at the Department for Education, I was informed that that was not the case, and that the promise that had been made back in 2008 was not
“a legal entitlement. It was a commitment made by the last government but was never made statutory”.
The Department further explained that there was no legal entitlement for pupils in any maintained school, including the old specialist schools, to study triple science. It was up to the school and the governing body to decide what science qualifications should be offered.
Regardless of the improvements that have been made throughout the country—and I accept that here have been fantastic improvements—the situation remains the same. Pupils who are trapped in a school that does not offer triple science GCSE will be prevented from studying the subjects that they wish to study, the subjects that could transform their future. Rather than that critical choice being placed in the hands of pupils themselves, allowing them to choose their own destiny, it remains the case that the power to arbitrate over pupils’ lives remains with the schools themselves.
I propose that the law be changed, so that pupils can be given not only the entitlement that was once promised to them, but what I call a “right to learn”. If a school is unable to offer triple science GCSE for whatever legitimate reason—and I fully understand that the provision of laboratories and specialist science staff is critical—it should have a duty to ensure that pupils are given the chance to study for those GCSEs elsewhere. I hope that such a duty would in itself act as a positive enabling force to help to end the “subject deserts” that are afflicting parts of the country, highlighting the fact that the current situation must change. I hope that it would ensure greater collaboration between schools, driving up further the number of pupils taking triple science GCSE. I have chosen science today because it is a particularly pressing example, but an equal case can be made for other EBacc subjects.
I hope that in another decade we shall be able to look back—as I have today—to review the progress that schools have made, and to assess the further progress that they must make if we are to ensure that pupils are given the best start in life in an increasingly competitive world. However, I also hope that by then we shall have relegated to history a world in which pupils’ educational chances, and the subjects that are offered to them, depend on the part of the country in which they were born. The fact that pupils are still being denied an opportunity to study for qualifications that are available to others in state-funded schools is unacceptable, and nothing short of educational discrimination. This simple Bill would ensure that, while the fight to reduce inequality of attainment must continue apace, we can at least end the inequality of access and opportunity to study for qualifications that should be available to all.
2.27 pm
Fiona Mactaggart (Slough) (Lab):
I oppose the Bill because, despite its title, I feel that the hon. Member for Kingswood (Chris Skidmore) has misunderstood the nature of the risk that is posed to students who need to study specific subjects. In blaming schools and teachers, he has ignored the imminent prospect of the withdrawal of certain modern foreign language A-level subjects.
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Students will have no opportunity to study for A-level qualifications in subjects such as Polish, Punjabi, Bengali and Hebrew, because the A-level examination board—the only board that provides for those subjects—is planning to withdraw the examinations in 2017.
The Government have failed to do anything to prevent the removal of Polish and Punjabi—the two languages which, after English, are most spoken in this country— from the A-level examination syllabus. In 1998, when such a move was last suggested, Members tabled an early-day motion, and succeeded in preventing Edexcel from ending the A-level examination in Polish. At that time, there were 100 students studying Polish A-level; now there are nearly 10 times as many, but the plan is still to abandon the course.
When Ofsted last looked at the teaching of modern foreign languages, it produced a report in January 2011 and pointed out that A-level entries in modern languages increased slightly between 2007 and 2010, from 28,377 to 29,836. Since then there has been a depressing decline. Entries for French are down 3,150 to 9,000, and entries for German are down 1,300 to 3,750. There has been a significant increase in the number of students getting qualifications in the minority modern foreign languages, which are the very languages that will soon be unavailable for examination.
So what did I do? I wrote to the AQA examination board and Ofqual and they responded. I sent a copy to the Secretary of State for Education, who has not responded. AQA said that
“government changes to the exam system and qualifications mean that only new GCSEs and A-levels accredited by the exams regulator, Ofqual, can be offered by awarding bodies”.
In other words, it is pointing to Ofqual. It also talks about the specific subjects I have raised:
“we will be faced with a number of challenges. We know it will become increasingly difficult to recruit sufficient examiners with assessment expertise to set and mark the four skills of reading, writing, speaking and listening.”
I have spoken to a senior examiner in Polish and she assures me there is no difficulty in finding suitably qualified examiners in that subject, yet AQA is determined to abandon it. It points out that only 983 students were entered in the last year, but it has ignored the fact that the Polish community, which is the biggest driver of the number of A-level entrants, is growing hugely. So this short-sighted policy risks the children of the many thousands of Poles who have settled in Britain in the last years not being able to study the language.
Let us have a look at what Ofqual says. It says:
“What is taught in schools up to Key Stage 4 is a matter for Government. After this the offering will be demand led for the exam boards who are free (mostly) to develop qualifications at A level that they wish.”
I want the Minister on the Treasury Bench, the hon. Member for Bognor Regis and Littlehampton (Mr Gibb), to make sure they are not mostly “free” to develop the qualifications they wish. Instead he should insist that they develop the qualifications students need, because if we do not study these modern foreign languages, including
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the languages of the growing markets in south Asia, we will lose important outward-facing opportunities for the British economy.
“We at Ofqual do not…seek to limit the curriculum. We do expect any GCSE, AS or A level to be of comparable demand”.
It is saying that it needs the same number of entrants for each subject, but at the current rate of decline the number of entrants for Polish and French will be very similar very soon, and I imagine that the number of entrants for Polish and German will be almost the same by the time the Polish A-level is abandoned.
The Government must use their power to direct Ofqual. The Ofqual response says that
“we here at Ofqual make no judgements on what subjects ought to be taught as part of key stages of the curriculum”.
Someone needs to take responsibility for making this judgment, because it is clear that there are sufficient examiners. The Polish University Abroad, which is based in London, runs further education courses for BA graduates in teaching Polish as a second language, and it does not expect any shortage of suitably qualified examiners in the near future.
If the hon. Member for Kingswood (Chris Skidmore) had focused his Bill on qualifications that students are prevented from being able to obtain by Government inaction, it could have enabled students to qualify in Polish, in Punjabi, in Hebrew, in Bengali—in all the languages that the examination boards are planning to abandon. If we abandon them, we cannot continue to depend on the fact that English is our greatest export as the reason why our companies can succeed so well. We need to recognise that in order to compete in an increasingly globalised world, Britain needs access to all those languages, and if we just look backwards we will not obtain the wealth our country needs or give children the chance to get an A-level in a subject they will succeed in.
The hon. Gentleman compared the approaches to learning in Hammersmith and Knowsley. I believe that one of the reasons why London education authorities are doing well in this regard is that London children bring many languages to their schools—languages they are able to be examined in and succeed in. If somebody has access to another language, they have insights that can strengthen all areas of their learning. We are about to deny an entire cohort of children that opportunity to be examined in modern foreign languages, and I wish the hon. Gentleman’s Bill would sort out that problem, rather than the one he has talked about.
Question put (Standing Order No. 23) and agreed to.
That Chris Skidmore, Dr Sarah Wollaston, Henry Smith, Neil Carmichael, Andrew Percy, Mr Dominic Raab, Nigel Adams, Mr Henry Bellingham, Richard Fuller, Christopher Pincher and Mrs Cheryl Gillan present the Bill.
Chris Skidmore accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 27 March, and to be printed (Bill 194).
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Business of the House (24, 25 and 26 March)
Motion made, and Question proposed,
That the following provisions shall have effect:
Sittings on 24, 25 and 26 March
(1) At today’s sitting and the sittings on Wednesday 25 March and Thursday 26 March–
(a) Standing Order No. 41A (Deferred divisions) shall not apply;
(b) Standing Orders Nos. 83D to 83H and 83I(2), (3) and (6) (conclusion of proceedings etc) shall apply to proceedings to be taken in accordance with this Order, but with the omission of Standing Orders Nos. 83D(2)(c) and 83E(2)(c);
(c) no notice shall be required of any Motion made by a Minister of the Crown and any Motion made by a Minister of the Crown may be proceeded with, though opposed, after the moment of interruption and shall not be interrupted under any Standing Order relating to the sittings of the House;
(d) no Motion to alter the order in which proceedings on a Bill are taken, to recommit a Bill or to vary or supplement the provisions of this Order shall be made except by a Minister of the Crown and the Question on any such Motion shall be put forthwith.
Tuesday 24 March
(2) At today’s sitting–
(a) proceedings on consideration of Lords Amendments to the Recall of MPs Bill
shall be brought to a conclusion (unless already concluded) three hours after their commencement;
(b) proceedings on consideration of Lords Amendments to the Small Business, Enterprise and Employment Bill shall be brought to a conclusion (unless already concluded) three hours after their commencement;
(c) the Lords Amendments to the Small Business, Enterprise and Employment Bill shall be considered in the following order: Nos. 34 to 62, 86, 132, 136 to 141, 1 to 33, 63 to 85, 87 to 131, 133 to 135 and 142 to 193;
(d) proceedings on the Motion in the name of Mr Chancellor of the Exchequer relating to approval for the purposes of section 5 of the European Communities (Amendment) Act 1993 shall be brought to a conclusion (unless already concluded) one and a half hours after their commencement;
(e) proceedings on the Motion in the name of Secretary Theresa May relating to the draft Counter-Terrorism and Security Act 2015 (Risk of Being Drawn into Terrorism) (Amendment and Guidance) Regulations 2015 and the Motion in the name of Secretary Chris Grayling relating to the Civil Procedure (Amendment) Rules 2015 shall be brought to a conclusion (unless already concluded) one and a half hours after the commencement of proceedings on the first of those Motions;
(f) any Lords Amendments or Lords Message in respect of any Bill may be considered forthwith without any further Question being put;
(g) subject to sub-paragraphs (a) and (b), proceedings on any Lords Amendments or Lords Message in respect of any Bill shall be brought to a conclusion (unless already
concluded) one hour after their commencement.
(3) The start of any emergency debate under Standing Order No. 24 (Emergency debates) to be held at today’s sitting shall be postponed until the conclusion of the proceedings at that sitting to which this Order applies.
Wednesday 25 March
(4) Proceedings on Second Reading and in Committee, any proceedings on Consideration, and proceedings on Third Reading on the Finance (No. 2) Bill shall be completed at the sitting on Wednesday 25 March, as follows–
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(a) proceedings on Second Reading shall be brought to a conclusion (unless already concluded) two hours after their commencement;
(b) when the Bill has been read a second time, it shall stand committed to a Committee of the whole House and, subject to sub-paragraph (c), the House shall immediately resolve itself into a Committee of the whole House on the Bill;
(c) where relevant, when the Bill has been read a second time–
(i) proceedings on the Bill shall stand postponed while the Question is put on
any Procedure Resolution relating to the Bill and, in accordance with Standing Order No. 52(1) (financial resolutions in connection with bills), on any Money Resolution or Ways and Means Resolution relating to the Bill;
(ii) on the conclusion of proceedings on any Procedure Resolution, Money Resolution or Ways and Means Resolution relating to the Bill, proceedings on the Bill shall be resumed and the House shall immediately resolve itself into a Committee of the whole House on the Bill;
(d) proceedings in the Committee of the whole House shall be taken in the following order: clauses 66 and 67 and new Clauses and new Schedules relating to value added tax; clauses 1 to 5 and new Clauses and new Schedules relating to the charge to, the rates of and the limits and allowances for income tax; clause 6 and new Clauses and new Schedules relating to the charge to, and the main rate of, corporation tax; remaining proceedings in Committee;
(e) if, on conclusion of proceedings in Committee, the Bill is reported with amendments, the House shall proceed to consider the Bill as amended without any Question being put;
(f) proceedings in Committee, any proceedings on Consideration and proceedings on Third Reading shall be brought to a conclusion (unless already concluded) six hours after the commencement of proceedings on Second Reading.
(5) Paragraph (4) shall have effect notwithstanding the practice of the House as to the
intervals between stages of a Bill brought in upon Ways and Means Resolutions.
(6) At the sitting on Wednesday 25 March–
(a) any Lords Amendments or Lords Message in respect of any Bill may be considered forthwith without any further Question being put;
(b) proceedings on any Lords Amendments or Lords Message in respect of any Bill shall be brought to a conclusion (unless already concluded) one hour after their commencement.
(7) The start of any emergency debate under Standing Order No. 24 (Emergency debates) to be held at the sitting on Wednesday 25 March shall be postponed until the conclusion of the proceedings at that sitting to which this Order applies.
Thursday 26 March
(8) On Thursday 26 March there shall be no sitting in Westminster Hall.
(9) At the sitting on Thursday 26 March–
(a) proceedings on the Motion in the name of Sir George Young relating to the valedictory debate recommended by the Backbench Business Committee shall be brought to a conclusion (unless already concluded) at 4.30pm;
(b) any Lords Amendments or Lords Message in respect of any Bill may be considered forthwith without any further Question being put;
(c) proceedings on any Lords Amendments or Lords Message in respect of any Bill shall be brought to a conclusion (unless already concluded) one hour after their commencement;
(d) no debate shall be held in accordance with Standing Order No. 24 (Emergency debates);
(e) the Speaker shall not adjourn the House before a Message has been received from the Lords Commissioners.
General
(10) Standing Order No. 82 (Business Committee) shall not apply in relation to any proceedings to which this Order applies.
24 Mar 2015 : Column 1331
(11) In this Order, a reference to proceedings on or in respect of a Bill includes a reference to proceedings on any Motion to alter the order in which those proceedings are considered and (except in paragraph (4)(c)) to proceedings on any Procedure Resolution, Money Resolution or Ways and Means Resolution in relation to those proceedings.
(12) If today’s sitting continues after 11.30 a.m. on Wednesday 25 March, this Order shall have effect as if any reference to the sitting on Wednesday 25 March or Thursday 26 March were a reference to today’s sitting.
(13) If the sitting on Wednesday 25 March continues after 9.30 a.m. on Thursday 26 March, this Order shall have effect as if any reference to the sitting on Thursday 26 March were a reference to the sitting on Wednesday 25 March.
(14) If today’s sitting or the sitting on Wednesday 25 March continues as described in paragraph (12) or (13), any business set down for consideration at the later sitting or sittings mentioned in that paragraph may be considered at the continued sitting, notwithstanding the practice of the House which forbids the bringing forward of an Order of the Day.—(Mr Hague.)
2.38 pm
Mr Christopher Chope (Christchurch) (Con): I am glad to have the opportunity to participate in this debate, and I am disappointed that my right hon. Friend the Leader of the House has not chosen to speak to this very important motion.
We are in a fixed-term Parliament. The Government have known for the best part of five years the date of Dissolution, yet this motion is expressed in terms that suggest there is some sort of emergency requiring the Finance Bill to be considered tomorrow in all its stages in a maximum of six hours.
It may well be that Opposition Members are indifferent to this, but having seen the Finance Bill, which was printed only today for the first time, I notice that the explanatory notes extend to some 258 pages. There are some 127 clauses covering 121 pages, and 21 schedules covering a further 220 pages. It does not seem possible to do justice to those provisions on behalf of all the people who could be affected by the Bill by considering it for only six hours and at relatively short notice. Given that we knew that we were approaching Dissolution, I hope that my right hon. Friend the Leader of the House will explain why the arrangements were made in such a way as to allow so little time for the Bill.
In the past, as I recall, a shorter Finance Bill has been introduced at this stage, with provision for a second Bill to be introduced after the general election to deal with matters in more detail. In that way, it has been possible to scrutinise the important changes that affect businesses and individuals up and down the country. I fear that we shall have no such opportunity this time.
I should also like to tease out what my right hon. Friend has in mind in paragraph 1(c) of the motion, which states:
“At today’s sitting and the sittings on Wednesday 25 March and Thursday 26 March…no notice shall be required of any Motion made by a Minister of the Crown and any Motion made by a Minister of the Crown may be proceeded with, though opposed, after the moment of interruption and shall not be interrupted under any Standing Order relating to the sittings of the House”.
Does one of the motions that he intends to bring forward under these provisions relate to the commitments he made to me and to the House in recent weeks? On 5 February, I asked him:
24 Mar 2015 : Column 1332
“When will my right hon. Friend publish the draft changes to Standing Orders that will be necessary to implement English votes on English issues?”
“That is a party matter, rather than a Government matter, since there are different policies among the coalition parties. However, it is important to show the detail, so I intend later this month to set out how the proposal that I made earlier this week can be implemented in Standing Orders.”—[Official Report, 5 February 2015; Vol. 592, c. 426.]
I was very pleased with that response. Unfortunately, nothing had happened by the end of February, so I returned to the issue on 12 March, again during business questions. I said to my right hon. Friend:
“On 5 February at column 426 of Hansard, my right hon. Friend told me that he intended ‘later’ in February to set out the draft changes to Standing Orders to implement English votes for English laws. Why was he not able to meet his own target deadline of the end of February? May I seek an assurance from him that he will meet it before his final departure from this place?”
“My right hon. Friend the Member for North West Hampshire (Sir George Young)”—
who I am pleased to see is in his place—
“asked about this last week. It is true that February has stretched into March, and I am conscious of the commitment that was made to my hon. Friend, so I do intend to publish the proposed Standing Order changes.”—[Official Report, 12 March 2015; Vol. 594, c. 413.]
Those changes to Standing Orders could be introduced in the form of a motion, no notice of which would be required, under the provisions of paragraph 1(c) of the business of the House motion that we are now considering. I hope that I am not being unduly optimistic in asking my right hon. Friend to confirm that that is indeed his intention, and that that is why he has included in the motion a reference to motions being able to be brought forward by Ministers of the Crown without notice. I have not yet seen any record in the Official Report of a ministerial statement altering the commitments that my right hon. Friend has already made on English votes for English laws, so I hope he will take this opportunity to introduce the changes today.
This matter is topical, not least because a series of public petitions is due to be presented later today by a host of my right hon. and hon. Friends on the issue of English votes for English laws. It would be a big mistake if we were to enter the general election campaign without having this matter properly clarified, at the very least in the form of a draft Standing Order attached to a motion brought forward by the Government without notice.
2.44 pm
The First Secretary of State and Leader of the House of Commons (Mr William Hague):
The type of motion before the House is usual in the run-up to the end of a Parliament, and this motion facilitates the effective and efficient use of the time of the House in bringing this Session, and this Parliament, to a satisfactory conclusion. My hon. Friend the Member for Christchurch (Mr Chope) is quite right to say that this Parliament is different from its predecessors in being a fixed-term Parliament. That is why there are so few Bills left to consider, and so few Bills moving between this House and the other place, at this stage. As is set out in the motion, we will go on to consider Lords amendments to two Bills, including the Modern Slavery Bill, which is still before the other
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place, but they represent a small proportion of the legislative programme and there is no reason why this should not come to an orderly conclusion. The motion provides for it to do so.
The one exception to the Bills that have been able to make such progress is of course the Finance Bill, to which my hon. Friend has referred. We have known for a long time that the Budget would take place six days ago on 18 March, which it duly did, and that a Finance Bill would therefore have to be considered in fairly short order between then and the Dissolution of Parliament. This is not an uncommon development. Those of us who were here in 1992 will remember the Budget being delivered only a couple of days before the Dissolution of Parliament, and that has happened on a number of other occasions as well. That has often led to substantial Finance Acts being introduced immediately after the Budget, as is the case here. I do not see any difference in principle between those occasions and this one.
Mr Chope: If my memory serves me correctly, a very short Finance Act followed the Budget in 1992, with the main, substantive Finance Bill being brought forward after the general election.
Mr Hague: It is true that there was a further Finance Act, but it is also true that many provisions were included in the initial Finance Act, as far as could be agreed with the Opposition. The present Opposition have not opposed—let us put it that way—the great majority of the measures in this year’s Budget, and we have therefore been able to include a greater proportion of it in the Finance Bill. As with any Bill, however, it will be for the House to reach its judgment in the normal way on the Finance Bill when we debate it tomorrow. My hon. Friend will be able to take part in those debates. We are providing the time that is available for the Finance Bill before the Dissolution of Parliament, which must by law take place on 30 March, which is next Monday, so the time available to debate the Bill is tomorrow. If my hon. Friend wants to tell Treasury Ministers that he wishes it was a smaller Finance Bill, he will of course be able to do so during those debates.
On my hon. Friend’s final question about paragraph 1(c) of the motion, the answer is a fairly comprehensive no. As I pointed out in my first answer that he read out on a change to Standing Orders relating to English votes on English laws, this is a party matter. It would be possible to lay a Government motion under the provisions of paragraph 1(c) only if such a motion had been agreed across the whole coalition. My hon. Friend is well versed in these matters, and he will know that the policy on this issue is not agreed across the coalition and that it therefore remains a party matter. It is therefore not for me, as Leader of the House in the Government, to publish any such proposed changes to Standing Orders; I could do so only as a Conservative party spokesman. It remains my intention to do so, but not as Leader of the House.
24 Mar 2015 : Column 1334
Recall of MPs Bill
Consideration of Lords amendments
Madam Deputy Speaker (Mrs Eleanor Laing): I must draw the House’s attention to the fact that financial privilege is involved in Lords amendment 18. If the House agrees to that Lords amendment, Mr Speaker will ensure that the appropriate entry is made in the Journal.
How an MP becomes subject to a recall petition process
2.50 pm
The Parliamentary Under-Secretary of State for Education (Mr Sam Gyimah): I beg to move, That this House agrees with Lords amendment 1.
Madam Deputy Speaker: With this it will be convenient to discuss Lords amendments 2 to 17, 21, 22 and 27.
Mr Gyimah: The amendments in this group relate to the circumstances that would trigger a recall petition. They were tabled by the Government in the House of Lords to ensure that the important changes made to the Bill in this House are reflected throughout the Bill, ensuring that the legislation works in practice. The Prime Minister made it clear that the Government would be open to Parliament changing and improving this Bill, and that has happened. We had a free vote on amendments brought forward on Report, and I am pleased that the provisions have been strengthened as a result.
Hon. Members may recall that on Report in this House, Members voted to add to the provisions in the Bill to trigger a recall petition following a conviction for expenses-related offences under section 10 of the Parliamentary Standards Act 2009, irrespective of sentence. The House also changed the second trigger so that a recall petition would be opened if an MP were suspended on the recommendation of the Standards Committee for 10 or more sitting days, rather than the 21 or more sitting days in the original Bill. As only the lead amendments were moved at that time, the Government tabled amendments in the House of Lords—amendments 1 to 6, 8, 9, 12 to 15, 17, 21 and 22—which are required to give full effect to the changes.
Amendment 7 gives effect to an amendment agreed in this House to ensure that offences committed before the Act comes into force can trigger the opening of a recall petition so long as the conviction and sentencing take place after the Act comes into force. Amendments 10 and 11 further define the allowable appeal period in the case of a conviction that would trigger the opening of a recall petition under the first or third recall condition. That ensures that an MP has the opportunity to appeal against a conviction, but that the recall petition process can also begin in a timely manner. Amendment 27 is a technical amendment, clarifying the definition of “overturned on appeal”. Amendment 16 corrects a minor oversight, by removing the requirement for the courts to inform the Speaker of a sentence that would
24 Mar 2015 : Column 1335
lead to recall if the person in question had already ceased to be an MP—in such circumstances, it is clearly no longer necessary for the Speaker to be informed.
The amendments in this group are therefore largely consequential and technical, and give proper effect to changes that were made with considerable support in this House. I look forward to the debate on these amendments, which I commend to the House.
Stephen Twigg (Liverpool, West Derby) (Lab/Co-op): We welcome and support these Lords amendments. On Report, it was a Labour amendment that added a third recall condition of conviction for an offence under section 10 of the 2009 Act, so we particularly welcome these amendments from the other place. As the Minister said, they are minor and technical amendments, but they ensure the Bill will work by making this third recall condition fully operational.
The group also contains helpful amendments concerning the second recall condition. For example, when an MP is suspended from the House, the report of the Committee on Standards which precedes the House of Commons’ order for a suspension must relate specifically to that MP, not to general behaviour. As the Minister said, the House of Lords has also tidied up certain elements of the Bill. Amendment 7 ensures that a recall petition can be brought for offences committed before the day on which the Act comes into force, so long as the conviction and sentencing took place after that date.
Amendment 10 ensures that the third recall condition—on conviction for an offence and sentencing—would begin once all relevant appeals had been determined. That is a sensible but important provision. Other amendments make welcome technical changes to tidy up the proposed legislation. Amendments 23 to 25 would remove the power of the Speaker to appoint a person to exercise the Speaker’s functions under the Bill in his or her absence, and instead allow the elected Chairman of Ways and Means or Deputy Chairman of Ways and Means to do so if the Speaker is unable to perform them. As the Minister explained, these are technical and consequential amendments, and the Opposition are happy to give them our support.
Mr David Heath (Somerton and Frome) (LD): I rise to support the amendments, such as they are, from the House of Lords. They clearly strengthen the Bill in a minor way. Members may recall that we expended a fair amount of time and effort trying to strengthen the Bill in a more concrete way when it was before this House by giving access to a non-parliamentary route for recall. I am sad that we did not find a solution acceptable to both Houses to enable that to happen. Having said that, I do not agree with the argument that it would be better not to have a Bill at all. This Bill is a substantial step forward. It does not go as far as I would like, but I recognise that if we have it in place and it receives Royal Assent, as I assume it will, there is a substrate on which we can build—not me, but successor Parliaments—in order to provide a more acceptable position for the future.
As the hon. Member for Liverpool, West Derby (Stephen Twigg) mentioned an amendment in the next group, I hope you will afford me the latitude of saying, Madam Deputy Speaker, that amendments 23 to 25 were ones that I tabled originally in this House. I am
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very pleased to see that the Government have accepted them in the Lords, so I will not need to say anything about them when we get to the next group.
Mr Gyimah: With the leave of the House, Madam Deputy Speaker, let me say, as I said in my opening remarks, that these amendments are sensible modifications, ensuring that the Bill works effectively. I hope the House will support them, I am grateful for the Opposition spokesman’s comments on them and I commend them to the House.
Lords amendments 2 to 17 agreed to.
Where and from when the recall petition may be signed
The Deputy Leader of the House of Commons (Tom Brake): I beg to move, That this House agrees with Lords amendment 18.
Madam Deputy Speaker: With this it will be convenient to consider Lords amendments 19, 20, 23 to 26 and 28 to 32.
Tom Brake: The amendments in this group relate to the way in which recall petitions will be run. They pick up on a number of points made in debates in both Houses and are designed to make improvements to the operation of the recall petitions for the benefit of constituents, administrators and campaigners. The amendments also ensure that the Electoral Commission plays a greater role in reporting on the operation of recall petitions in practice. I will describe the amendments briefly and will also address the more technical amendments that form part of this group.
Amendments 18 to 20 relate to constituents’ engagement with and access to the recall petition process. Lords amendment 18 increases the number of signing places that the petition officer can designate from a maximum of four to a maximum of 10. This amendment addresses concerns expressed during previous debates in this House and the House of Lords about accessibility for constituents living in rural areas who may wish to sign the petition in person. In setting the number at 10, we consulted the Electoral Management Board for Scotland and the returning officers for the Western Isles and for Argyll and Bute. They were clear that a limit of four could pose particular challenges in large rural constituencies or in constituencies with a number of islands, and felt that a raised limit would afford them helpful flexibility.
3 pm
The increase in the maximum number of signing places has enabled the Government to consider whether a reduction in the signing period would be sensible, given the improved access to the signing process. Having considered the issue carefully, the Government brought forward Lords amendment 19, which reduces the signing period from eight to six weeks. That means that the constituents and the MP in question would get the result of the petition much quicker than we originally
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proposed. A slightly shorter period will have practical benefits for the administration of petitions and means that campaigners do not need to sustain their activities over quite so long a period.
The increase in the number of signing places and the reduction in the signing period strikes the right balance between tightening the process and enabling proper access to signing. It allows sufficient time for electors to consider the campaigns for and against signing a petition and enables those who wish to sign by post to make an application.
Lords amendment 20 improves the final sentence of the wording to appear on the petition signing sheet, making it easier for electors to understand that, if fewer than 10% of the registered electors in a constituency sign a petition, the MP will not lose his or her seat and a by-election will not be held.
Members will remember that my right hon. Friend the Member for Somerton and Frome (Mr Heath) tabled an amendment on Report to improve the wording on this point, and, having reflected on the helpful contributions made in the debate on that amendment, the Government brought forward a comparable amendment.
Amendments 23 to 25, which relate to clause 19, make provision for the recall process to start if the Speaker is unable to perform his duties as set out in the Bill. Clause 19, when originally drafted, mirrored existing legislation in permitting the Speaker to appoint a deputy to carry out those functions.
During the debate in this House, the question of whether that is necessary was raised, as we now elect the Chairman and Deputy Chairman of Ways and Means. The amendments update the Bill to reflect that important change in the House’s arrangements by making it clear that, where the Speaker is unable to perform his functions under the Bill, they will transfer automatically to the Chairman or Deputy Chairman of Ways and Means. I thank my right hon. Friend for flagging up that matter during earlier debates. On behalf of everyone here, let me say that his expertise in this area will be greatly missed in the next Parliament.
Amendment 24 clarifies that the Speaker will be unable to carry out his functions if he is himself the subject of a recall petition, in which case the function would pass to the Chairman or Deputy Chairman of Ways and Means.
Briefly, Lords amendment 26 was made in response to the Delegated Powers and Regulatory Reform Committee’s report on the Bill. A power to amend the Act through secondary legislation was originally included to allow it to be easily updated with regard to reforms of existing electoral law, such as the move to individual electoral registration. Those reforms were outstanding at that point but have now been made. There is therefore no longer a need for the power to amend the Act itself through regulations. Amendment 26, therefore, removes this power in accordance with the Delegated Powers and Regulatory Reform Committee’s recommendation.
Lastly, Lords amendments 28 to 30 and 32 relate to the role of the Electoral Commission in the recall process. The amendments build on those tabled by the Opposition on Report in the House of Lords. The Government are grateful to the Opposition for their support on Third Reading. It must have been something
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of a novelty for the Opposition to see the Government so readily accept amendments during the progress of this Bill.
During the Bill’s progress through the House of Lords, noble Lords expressed their concern, which the Government share, that the rules for regulating the campaign must function in practice. These amendments will require the petition officer to forward all recall petition returns to the Electoral Commission. That will support a further amendment requiring the Electoral Commission to produce a report after every recall petition. That alters the original provisions in the Bill, which required the Electoral Commission to report only on its own initiative.
The Electoral Commission’s report will look at how the provisions of the Act, including the rules on spending and donations, operated in practice at each petition. It has indicated that automatically receiving the spending and donation returns will allow it to examine and report on whether the current spending limits and registration thresholds seem appropriate for recall events, and whether they prevent undue influence over the outcome of these processes.
In drafting this Bill, the Government have sought to ensure that, in the event of a recall petition taking place, the process is fair to all participants, that participation is encouraged and that wealthy campaigners cannot have an undue influence.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC): I have listened with great interest to what the Minister has to say. Does not Lords amendment 19, which reduces the period during which the recall petition would be available for signing from eight to six weeks, make it far more likely that an MP under the recall mechanism will survive the process?
Tom Brake: We had to strike a balance between the number of signing places and the number of weeks that a petition was available. We felt that, following the discussions that had taken place in both Houses, the idea of providing a maximum of 10 signing places and allowing six weeks was an appropriate compromise. It is always worth reinforcing the point that postal voting is available, which makes the petition process and the recall process quite open and acceptable.
Jonathan Edwards: In the Minister’s opening remarks, he coupled Lords amendment 18 with Lords amendment 19. Would it not be better for Lords amendment 18 to say a “minimum” of 10 rather than a maximum of 10?
Tom Brake: That is a subject of debate. If the returning officer in the constituency of Argyll and Bute, which has, I think, more islands than any other constituency, felt that 10 signing places was appropriate, it is difficult to envisage circumstances in which more than 10 would be required anywhere else in the country. There can always be a debate on whether that is the appropriate number. I hope that returning officers will ensure that, for their particular locality, the right number is chosen. I suspect that in my patch, if ever there were to be a recall petition in Carshalton and Wallington, two or three signing places would be the maximum required, as the constituency size is only about four by five miles. However, I have to say that such a petition will not be required in my constituency.
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With these amendments, the Electoral Commission will be able to review every recall petition process to help ensure that the spending and donations rules are working in line with the principles. Lords amendment 31 corrects a minor and technical cross-reference in schedule 5 to the Bill.
I look forward to a short debate on these amendments, which I commend to the House.
Stephen Twigg: Let me start by apologising to the House, particularly to the right hon. Member for Somerton and Frome (Mr Heath), that I was a little ahead of myself in addressing amendments 23 to 25, which are in the second grouping. I echo what the Deputy Leader of the House said by way of tribute to the right hon. Gentleman for his record of work in this House. He has sought not only to work for his constituents but to reconnect the House with the public, which is an important challenge for all of us.
The second group of amendments significantly improves the original legislation. As the Deputy Leader of the House has said, Lords amendment 18 would increase the number of places that the petition officer could designate in their constituency for signing the recall petition, from a maximum of four to a maximum of 10. That is welcome and should ensure that accessing a petition is not an overly difficult process for constituents. Amendment 19 would reduce the length of the period during which the recall petition is available, from eight to six weeks. We support that as it is combined with an increase in the number of signing places. Taken together, those amendments allow for easy access to the petition while giving a realistic time scale for the collection of signatures.
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Lords amendment 26 is welcome. It removes the power for the Act itself to be amended by regulations. Lords amendment 32 is especially welcome and important as it requires the Electoral Commission to produce and publish a report on the recall petition process after the end of the petition period in relation to each recall petition. That is important because it enables us to learn from the process as it develops. This is a new and innovative feature of our political system. It is good that the Electoral Commission is tasked with producing and publishing such a report, so that we can learn lessons from each petition and, if necessary, make changes to improve public access to the process.
I agree that the Bill has been improved through the stages of scrutiny in this place and in the House of Lords. I believe it will play a part—probably quite a modest part—in improving the accountability of Parliament and Members of Parliament, and therefore play a small role in renewing our political institutions.
Tom Brake: With the leave of the House, Madam Deputy Speaker, may I say that the amendments follow thorough scrutiny in both Houses and will improve the operation of recall petitions by encouraging participation and ensuring public confidence in the outcome. I thank hon. Members on both sides of the House for their constructive scrutiny of the Bill. I believe the Bill will provide our constituents with a further means of holding us to account—beyond the greater means that happen on 7 May—in the form of an additional tool that can be used where Members of Parliament have committed serious wrongdoing. I commend the amendments to the House.
Lords amendment 18 agreed to, with Commons financial privilege waived.
Lords amendments 19 to 32 agreed to.
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Small Business, Enterprise and Employment Bill
Consideration of Lords amendments
Madam Deputy Speaker (Mrs Eleanor Laing): I must draw the House’s attention to the fact that financial privilege is involved in Lords amendments 85, 123 and 133. If the House agrees to any of these amendments, Mr Speaker will cause an appropriate entry to be made in the Journal.
The Pubs Code
3.12 pm
The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Jo Swinson): I beg to move, That this House agrees with Lords amendment 34.
Madam Deputy Speaker: With this it will be convenient to discuss Lords amendments 35 to 62, 86, 132 and 136 to 141.
Jo Swinson: Part 4 of the Bill will introduce a statutory code and an independent adjudicator to regulate the relationship between large pub companies and their tied tenants. It will address problems about which many hon. Members and the Select Committee on Business, Innovation and Skills have been concerned for a number of years.
The House will remember that, on Report in this House in November, a market rent only option for tied pub tenants was added by way of a vote. In the other place, my noble Friend Baroness Neville-Rolfe confirmed the Government’s acceptance of the will of this House, so we have before us a Bill that honours that commitment and remains true to the spirit and intention of the amendment introduced by this House on Report. For example, MRO must be provided for by the code, it must set out reasonable time scales for the process, and it must include certain MRO triggers. Government amendments 39, 40 and 41 amend the original clause 42, which was introduced by my hon. Friend the Member for Leeds North West (Greg Mulholland). I take this opportunity to pay tribute to his dedication to this cause, his relentless campaigning for the rights of tied tenants, and his willingness to move forward. The way he has worked and championed the measure with MPs from both sides of the House, with the all-party group and with campaigners up and down the country is a real testament to what can be achieved by someone with vision and determination.
The amendments ensure that MRO is workable within the approach taken in part 4, is legally robust, and avoids unintended consequences. They are split into three clauses for clarity, one setting out a clear framework for the MRO option, one making provision for the procedures needed to deliver it, and one providing for the adjudicator to resolve disputes.
Amendment 39 provides tied tenants with the right to a market rent only agreement at a number of trigger points: at a rent review, at lease renewal, when there is a significant and unexpected price increase, or if an event occurs that is outside the tenant’s control and has a significant impact on the tenant’s trade. Although
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prospective tenants will not have the right to the market rent only option, they will have the protection of the parallel rent assessment, so that they can judge if the tied deal they are being offered is fair. PRA will also be available to existing tenants and, through secondary legislation, will be streamlined with the MRO process.
Amendment 40 sets out the procedure for the market rent only option and provides that the pubs code must specify a reasonable period for the two stages of the process. The first stage is where a tenant and their pub company try to agree a rent, and the second involves the determination of a market rent by an independent assessor. Amendment 41 provides the powers to enable the adjudicator to resolve disputes over matters such as the proposed MRO agreement, the independent assessor’s determination of the market rent, and whether the MRO procedures have been followed.
The original MRO clause included triggers for MRO upon the sale of a pub or the administration of a pub-owning company. In discussions with stakeholders, it became clear that it was not the fact of sale or administration itself that was a concern; rather, it was the potential for a pub sale, whether as part of an administration or in the normal course of business, to result in adverse consequences for the tenant. After extensive consultation and discussion with stakeholders and debate in the other place, amendment 47 extends the protections of the code—apart from the market rent only option—to tenants whose pub is sold by a code company to a company outside the statutory code.
To deter avoidance and ensure fairness we are also continuing code protections—excluding the market rent only option—until the next rent review for the tied tenants of pubs owned by a code company which, by selling a number of their other pubs, falls below the threshold of 500 tied pubs. Those tenants too would have continuing rights and expectations regarding their existing lease and the protections they should have under the statutory code, and they should not lose their protections because of events beyond their control.
We believe that this is a proportionate and targeted protection. It will last until the next rent assessment or the end of the tenancy, whichever comes first. MRO will not be extended, and nor will the investigation powers of the adjudicator. Investigation powers are not continued because they are designed to uncover systemic breaches of the code. It would not be right to include in that power companies that are obliged to follow the code only because some of the pubs they own used to belong to a code company, and that are covered by the code only in respect of those pubs. However, the arbitration powers of the adjudicator do remain, so those tenants will be able to refer any allegations of a code breach during the extension period to the adjudicator.
Mr Jim Cunningham (Coventry South) (Lab): What would the penalty be for any breaches?
Jo Swinson: The adjudicator will be able to make recommendations so that problems can be put right, and ultimately it will have the power to levy fines. The specific details will be set out in secondary legislation, but we have a model in the Groceries Code Adjudicator. That adjudicator is already working, and we are learning from it how such a system can work smoothly in terms of staffing, for example.
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Amendments 43, 44, 45, 55, 132 and 139 are consequential technical amendments to the MRO amendments. They relate to the enforcement of the code, the adjudicator’s annual report, the list of defined terms in clause 69 and to commencement.
The original market rent only clause allowed brewers that own tied pubs to require their MRO tenants to continue to sell the brewery’s products, as long as the tenant may buy them from any source. Amendment 46 implements that intention by amending clause 65 so that such a stocking requirement in a tenancy agreement would not of itself make the pub a tied pub. In stakeholder discussions, brewers requested greater clarity on what they were permitted to do under a stocking requirement; others were concerned that the stocking requirement might lead to undue restrictions on tenants who have chosen MRO.
Amendment 46 clarifies that brewers may also protect their route to market by allowing some restrictions on the sales of competitors’ products in their MRO pubs. However they will not be able to require that these pubs sell only their products and they will need to satisfy themselves that the requirements they are imposing are compliant with competition law. The restrictions may be placed only on beer and cider products and, crucially, tenants must be able to buy the brewer’s products from any source.
Toby Perkins (Chesterfield) (Lab): In the event of marketing arrangements which meant that the only place that beers could be purchased was direct from the brewer, do the provisions take account of the fact that the tenant’s right to do so might be difficult to put into practice?
Jo Swinson: The adjudicator could look into whether practices were all fair and whether the code had been properly complied with. Depending on the circumstances, competition law may also be relevant. The companies would have to assure themselves that any restrictions that they were placing were compliant with competition law. Through the new code and the adjudicator we will make sure that there is somebody who can look into the circumstances and arbitrate on whether what is being offered is fair and compliant with the statutory code.
For completeness, I shall touch on three other important areas of debate both here and in the other place where the Government have made important commitments to use existing powers in the Bill. On Report in this House, I committed to consider calls to exempt genuinely short-term agreements from the pubs code. My noble Friend Baroness Neville-Rolfe confirmed that the Government would use the power in clause 68 to exclude from the code tied pubs that are operated on short-term tenancy at will and temporary agreements that do not extend beyond a certain limited period. We intend to consult on the length of the period for exemption.
Hon. Members will remember that pub franchise agreements are in scope of our measures. They are, after all, tied pub agreements and share many of the characteristics of traditional tied pubs. Nevertheless, consistent calls have been made in both Houses to exempt certain franchise agreements from the code, or at least from MRO, if they do not charge rent and the price of products does not affect the tenant’s share of income. After much consideration, my noble Friend the
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Minister announced in the other place that the Government will use the power in clause 68 to exempt genuine franchises from the MRO provisions. The remaining code protections—for example, in respect of transparency—will still apply.
Given the differences between traditional tied pubs and genuine franchise agreements, we consider this a reasonable exemption. We will consult on the precise definition of “genuine franchise”, but we expect it to include criteria such as where a turnover fee rather than a rent is paid by the tenant and the share of the profit is unaffected by the price paid for tied products. This is important as these criteria can mean that the tenant’s interests are arguably more aligned with those of the pub company because both rely on a fixed proportion of turnover. The tenant in such circumstances does not face the combination of the wet and dry rent, as tenants do in traditional agreements.
There are other agreements in the industry which may be marketed as a pub franchise that display elements common to franchises in other sectors, such as common branding. But if they charge tenants a tied rent in the traditional way, they are not inherently fairer than a tied pub agreement. The consultation will allow us to set out the criteria for a genuine franchise.
In addition, I should clarify that where a franchise pub falls within the definition of a tied pub in clause 65, it will count towards the number of tied pubs that a company owns for the purposes of the 500 tied pub threshold. This will ensure that we do not create a loophole in the legislation. Furthermore, the Government would be able to amend the regulations should there be attempts to use this exemption as a means of avoiding the legislation.
Next, I come to the matter of investment. Hon. Members will recall that Government committed to avoiding unintended consequences in introducing this legislation. In the other place, and in discussions with stakeholders, concerns were raised as to whether investment in tied pubs could be discouraged because of uncertainty as to whether a tied tenant might trigger MRO. Views vary as to the extent of this risk to investment, but the Government consider that we should act to minimise any risk. We want to ensure that investment in pubs can take place and that pubs thrive. I am sure that sentiment is shared across the House.
The Bill as drafted does not prevent pub companies from issuing a tenant with a new lease alongside an offer of investment, and no amendment to the Bill is necessary to enable companies to do so. This would, in effect, provide a waiver from the rent review and renewal MRO triggers for five years. However, the Government recognise that significant investments may warrant a longer period of return on investment. My noble Friend the Minister therefore announced in the other place that the Government will use existing powers in clause 41 to set out in the code different rent assessment periods for different amounts of substantial capital investment offered. This will have the effect of deferring the rent assessment trigger for MRO for a longer period. It is important to note, though, that the other MRO triggers—that of a significant price increase and an economic event that impacts on a tenant’s trade—will remain throughout the deferral period.
Alongside setting out the deferral periods for different levels of investment, the secondary legislation will set out important safeguards for tenants—for example, to
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ensure that they accept an investment offer only after taking proper advice and that they cannot be pressurised. This is an area where both sides of the debate recognise that the need to enable investment and the need to protect tenants must go hand in hand. It is important that we can consult fully on the details so that we get it right.
These commitments regarding exemptions for certain tenancy at will, temporary and franchise agreements, and for a deferral of MRO in return for substantial investment, are not on the face of the Bill. They will be set out in secondary legislation after full public consultation.
I shall touch briefly on a number of technical amendments in this group before turning to the second issue in the group. Amendments 34 to 37 are technical clarifications to the “no worse off” and “fair and lawful dealing” principles. The key change is to make it clear that tied pub tenants should not be worse off than they would be if they were not subject to any product or service tie. Amendments 35, 36, 38, 42 and 48 to 54 are consequential on the changes made to clause 66 in this House to exclude family brewers from the provisions. This change means the legislation will apply only to a pub-owning business with 500 or more tied pubs. There are further minor technical amendments, on which I refer honourable Members to the explanatory notes for a fuller explanation.
Finally, amendments 136, 137, 138, 140 and 141 relate to adjudicator staffing and the point that I made earlier in response to the hon. Gentleman. They amend schedule 1 to enable the adjudicator to second staff from any source, in addition to the existing power in the Bill for the adjudicator to second from the public sector. The aim is to provide the necessary flexibility for the adjudicator to find suitable staff from a wider pool.
I am sure the House will agree that throughout our debates in both Houses all the pubs measures have been thoroughly scrutinised. Incorporating the market rent only option into the Bill in the limited time available to us and ensuring that it will work in practice has not been easy, but I believe that we have produced legislation that promises to be effective as well as targeted and proportionate. Crucially, these measures mark an historic moment for tied tenants of pub-owning companies. They will have the protections of a statutory code with a powerful and independent adjudicator to enforce that code. That the measures have the support of my hon. Friend the Member for Leeds North West, CAMRA, Fair Pint and others is testament to that, so I hope the House will agree to the amendments.
Sir Greg Knight (East Yorkshire) (Con): I understand that the provisions on staff secondment require the Secretary of State’s approval. Can my hon. Friend give the House an example of the circumstances in which a Secretary of State might refuse such approval?
Jo Swinson:
Clearly, the intention is to make sure that the adjudicator is able to recruit staff with the requisite expertise and experience, not only from the public sector pool. That is an important change and we have learned from the legislation that we have in place for the Groceries Code Adjudicator. Understandable concerns were raised in Committee about whether staff would come with
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vested interests. It is important that protections are in place to ensure that everybody can have confidence in the staff who are seconded, and to ensure that up-to-date experience of industry does not entail a conflict of interest.
On amendment 86 and the important matter of pay transparency, I am delighted to reiterate the Government’s support for this amendment to the employment part of the Bill that was introduced in the other place. We have already legislated in this Parliament to ensure that companies which directly discriminate against women in pay matters can be required by a tribunal to complete a gender pay audit, as well as to pay compensation. The new provision requires the next Government to make regulations under section 78 of the Equality Act 2010 within 12 months of the Bill receiving Royal Assent. Section 78 requires mandatory reporting of gender pay information by larger companies.
It is 45 years since the Equal Pay Act, and although the gender pay gap is at its lowest ever level and has been virtually eliminated for full-time workers under the age of 40, it is simply not acceptable that in 2015 we still have a gender pay gap at all. We are determined to eliminate it entirely.
Toby Perkins: I endorse what the Minister says about the need to deal with this matter urgently. Given that urgency, will she explain why the provision she is now bringing forward under the Equality Act 2010 has been sitting on the statute book for five years? Why is it that only at the fag end of this Parliament are we seeing some action, which the Opposition have been calling for throughout those years?
Jo Swinson: The hon. Gentleman says that the Opposition have been calling for this throughout this Parliament, but unfortunately that was not the case when they were in government. I refer him to the Hansard report of proceedings on the Equality Bill on 24 June 2009, when the then Labour Minister said that
“having mandatory arrangements in force by 2011 would run the risk of riding roughshod over the legitimate voice of both sides of the business community. Progress can better be made by bringing employers with us—by including, encouraging and cajoling, rather than compelling.”
My right hon. Friend the Member for Hornsey and Wood Green (Lynne Featherstone) responded:
“We cannot wait another four years…It is clear that we must take action now”.––[Official Report, Equality Bill Public Bill Committee, 23 June 2009; c. 410-432.]
We have got agreement in the Government to take that forward, but I have to say that the context of the commitments made from this Dispatch Box by the previous Labour Government during the passage of the Equality Act—they committed to a voluntary approach before implementing the legislation—certainly did not make that easier. None the less, I am delighted that we are now where we are.
3.30 pm
We have of course been taking action over the past few years. Our Think, Act, Report initiative has created a powerful community of companies that are leading the way on gender equality. More than 275 companies covering more than 2.5 million employees are now taking action and sharing best practice on how they
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recruit, promote and retain female talent in their organisations. However, too few have voluntarily published their pay gap. I would like to take this opportunity to praise those companies that have taken that courageous step. Companies such as Friends Life, Genesis Housing Association, PricewaterhouseCoopers, Tesco, AstraZeneca and Sodexo have made the commitment that they would do so by 2016.
However, I have spoken with representatives of some of those companies about how they managed to achieve that change within their organisations, and they have told me of the battles they had to have in order to get that past their lawyers because of concern about the risk to the company. Indeed, at one event at which we were discussing the pay gap a business woman told me that companies would not publish those data because they would be self-critical. To be fair to employers, the gender pay gap is a thorny problem that has a range of different causes, not least occupational segregation, with women going into lower-paid sectors and jobs, and subject choices made at school. Therefore, tackling the gender pay gap is not straightforward. That is why we said that we would keep section 78 under review, which is what we have done.
The amendment recognises that unless it is a legal requirement, organisations are much less likely to be prepared to publish those data because, for the reasons I have outlined, it is not the kind of picture that we all want to see in society. However, the transparency is crucial to making sure that we can tackle it. These regulations will require private and voluntary sector employers in Great Britain with at least 250 employees to publish information about the differences in pay between their male and female staff. By activating section 78, we will shine a light on the gender pay gap.
The gender pay gap is not primarily about men and women being paid differently for the same job, although that forms part of it. That is already unlawful and has been prohibited by equal pay legislation for many years. The larger elements of the gender pay gap concern occupational segregation and career penalties for taking time out of the labour market, often because of caring responsibilities. Those things combine to create a situation in which women are paid less. We want more businesses to take a proactive approach to tackling these problems and promoting equality in workplaces across the country. Employers might want to review their arrangements for flexible and part-time working patterns, provide support for maternity returners, actively encourage men to use shared parental leave and tackle unconscious bias during recruitment.
Roger Cotton of Friends Life, which won last year’s Opportunity Now award for transparency, has clearly set out the case for gender pay gap reporting. He said: “What gets measured gets managed…what gets published gets managed even better.” I am delighted that the Women’s Business Council, an independent body established by Government, has today published a short guide for businesses on the gender pay gap, entitled, “Mending the talent gap”. It explains to employers what the gender pay gap is, why it matters and the actions they can take to help close it. I would like to offer a special thanks to the council’s members, and particularly its dynamic chair, Ruby McGregor-Smith, the CEO of Mitie Group, for their continuing dedication and
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commitment to using their immense influence within the business world to advance women’s position in the workplace.
The amendment before us requires that consultation must take place before implementation. By consulting with business, we will find the best and most effective way of implementing section 78 while meeting the objective of achieving genuine transparency on pay and tackling the gender pay gap now. I look forward to the House’s support for the amendment.
Toby Perkins: It is a great pleasure to speak on the amendments proposed by the noble Lords.
On 16 July, we debated the Second Reading of this Bill. It was interesting, in preparing for this debate, to re-read the contributions that were made then and those that have been made by Labour Members in both Houses during its subsequent stages. Though modesty would usually prevent me from quoting extensively from the contribution that I made, it would be strange not to reflect on how widely our critique of the Bill has been adopted by the Government. We said that it had the potential to make a real difference to small businesses but that the steps that it originally proposed were a collection of faint nods in the right direction of key issues that had emerged under this Government. We said that far more robust action would be needed if this Bill was to deliver on the steps small businesses required and to take action on things like abuses of the labour market and their impact on workers in every constituency in the land. On the subject of pubs, we said that a successful small business Bill—a Labour small business Bill—would have introduced a code with a market rent only option, which the Bill now indeed contains. It would be churlish not to recognise that the Government have ultimately acted in good faith on pub company legislation.
I should place it on the record that this is the last piece of legislation that the Minister will be bringing through in this Parliament. As we fast approach the general election, who knows when will be the next time a Liberal Democrat Minister will have the opportunity to bring through a piece of legislation? She has done a good job in reflecting the wishes of the House and has acted in good faith on pub company regulation.
Their lordships’ amendments broadly achieve the objective of striking the devilishly difficult balance between proper protection for pub tenants while not imposing an overly rigid straitjacket on the industry with the potential to discourage future investment. They are positive steps forward that have faithfully built on the spirit of the historic clause 42 proposed by the hon. Member for Leeds North West (Greg Mulholland). We recognise that some aspects of the proposals will sensibly need to be included in the pubs code through secondary legislation.
There remains the thorny issue of the right of the tenant to offer a substantial investment in their public house in exchange for giving up the right to use the next rent review period as a trigger to request an MRO assessment. The letter dated 16 March from the Minister, Baroness Neville-Rolfe, to the noble Lords Mendelsohn and Stevenson details the Government’s intentions with regard to new clause 43 and specifies that it must not be used to abuse the waiver. However, this will still leave those who fought this cause for many
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years with considerable unease that this creates the potential for too broad an exemption for too small an investment.
We entirely agree with the Government that encouraging future investment in the stock of public houses is a crucial element in the future success of the industry, but, over four months since the original victory for clause 42, that still leaves a huge unanswered question about the scale of investment that constitutes “substantial”. I think that my party’s record on this issue means that campaigners will have confidence that the statutory code that addresses it under a future Labour Government will be consistent with the approach—
Andrew Griffiths (Burton) (Con): The hon. Gentleman mentioned his party’s position on investment. What scale of investment does he believe would constitute “substantial”?
Toby Perkins: That is an excellent question. The whole reason this issue is being placed in secondary legislation is that we recognise that there is a very difficult balance to strike. The formula needs to be dependent on the relationship of the investment to the value of the pub. For some pubs, a £30,000 investment might be substantial. For a town centre or city centre pub, a £200,000 investment might not be so substantial. There needs to be some sort of relationship between the rateable value of a pub, the amount that it turns over, and the amount of investment.
The hon. Gentleman is echoing my point, which is that this has been left very open. A great deal of work would need to be done. I assure the House that under a future Labour Government the principles laid out by Baroness Neville-Rolfe are exactly how we would see this. I anticipate that the same would be true of a Liberal Democrat-influenced Administration, although it would be good to hear the Minister clarify that. It would also be good to hear from the Conservative party whether its manifesto will follow the Bill’s principles, or whether it will take a different approach. The industry and campaigners have the right to expect that.
The Minister for Business and Enterprise (Matthew Hancock): For the record, the Conservative party’s position on this issue is exactly the same as that of the Government.
Toby Perkins: Excellent. I am glad that that has been placed on the record. That will give people considerable confidence in the Bill, and many campaigners will be grateful to hear what the Minister has just said. In the unlikely event of a Conservative victory, we will hold him to it.
Toby Perkins: We understand that Lynton Crosby has been telling the Conservatives to get ready for the past four or five months, but they never seem to reach the point he promises. We will no doubt debate that over the next six weeks.
The Government’s Lords amendment 39 replaces clause 42. We were proud to support the new clause tabled by the hon. Member for Leeds North West. We
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did not think that Report stage was the time to get into a detailed discussion of all the nuances of each individual line, and we know that a tremendous amount of work went into drafting a clause that would offer all the necessary protections. We felt, however, that ultimately it was too prescriptive and could have unintended consequences, and we are pleased to have worked with the Government on the drafting of the new provision.
Lords amendment 39 retains the triggers of renewal of tenancy, rent assessments and significant and unexpected price increases or other events beyond the tenant’s control that have a significant impact on their level of trade. The amendment omits the transfer of title and administration triggers that were in the original clause.
On balance, we support that omission, albeit not without reservation. We believe that the impact on the natural order of a competitive market that would have resulted from pub tenants having the right to opt out at the point of transfer of title would have caused a real disincentive to invest. Ironically, it would have meant that when a pub was sold from a major pub chain to a microbrewer, fledgling pub operator or family brewer, the MRO could have been triggered, acting as a disincentive to the sort of business transaction we want to support and encourage as part of the diversification of the pub market.
That means that campaigners and the next Government will need to be vigilant to prevent any attempts to use the amendment to game the legislation and exempt from the rights companies with any association with companies that we would expect the legislation to cover. The Minister in the other place has made specific the Government’s intentions and we have heard that there is consistency across the coalition.
On the subject of tenants of pub-owning companies that go into administration, we fear that, at a time when the whole future of a large number of pubs would be very uncertain, the original provision would have made the task of the administrator a great deal more difficult. When they would be attempting to bring order to a complicated situation, some of the stock they were trying to sell off to new providers would disappear and move into the free trade sector. We concluded that that would make it much more difficult for pubs to survive in the event of a major pub-owning company failure. For those reasons, we support those omissions from Lords amendment 39.
On Lords amendments 47 to 53, we are pleased that the Government have not sought to reintroduce to the code pub-owning companies with fewer than 500 pubs. The Under-Secretary of State for Business, Innovation and Skills, the hon. Member for East Dunbartonshire (Jo Swinson) and I have enjoyed many a to and fro on the subject during the Bill’s various stages, but I remain of the view that, in voting the way we did, some egregious practices may not be covered by the protections. However, without that concession, we would have been less likely to win the support of the House for the MRO option. In the final analysis, that prize was worth the sacrifice. As a gesture of good will to the industry and as a matter of honour, this House should stick to what we have given it to believe we were legislating on, namely a code containing provisions for businesses owning more than 500 pubs. We are therefore pleased to support the Government’s commitment.
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The Government have probably got the balance right in Lords amendment 47, which accepts our suggestion of extending code protections—apart from the MRO option—to tenants whose pubs are sold from a pub-owning company covered by the Bill’s provisions to a company outside the Bill’s scope.
Lords amendment 46 also performs a delicate balancing act by retaining the protection for pub-owning brewers to offer free of tie while also retaining their right to insist that their product is marketed. The question I asked the Minister is important, because some pub-owning brewers might think that retaining their stock and the right to market it is more important than their wholesale business. In that eventuality, if a brewer stops selling through their wholesale business, which they are perfectly entitled to do, a tenant who is in principle free of tie will still be forced, under the provision, to buy from that brewer as the only option available. We will need to look at that again.
3.45 pm
In summary, the pubs code with a market rent only option, which Opposition Members and indeed many right hon. and hon. Government Members have called for during most of this Parliament, is now being delivered. A considerable amount of work still needs to be done to ensure that the code backs up the Bill’s intentions, but this House and the other place have done a job of work and the Bill, which we have a chance to pass into law today, is a good deal stronger than anyone could have anticipated back in July.
The Minister is absolutely right to say that Lords amendment 86 is very important. Ironically, she quoted her right hon. Friend the Member for Hornsey and Wood Green (Lynne Featherstone), who said in 2009 that four years was too long to wait, but she has been part of a Government who have waited until the very end and who—even during the passage of the Bill—did not intend to bring in such a provision until, in the face of defeat in the other place, they had to back down on the amendment championed by Baroness Thornton and Baroness King. The amendment stayed on the Lords marshalled list for weeks and weeks without the Government taking any action. When Baroness King spoke in favour of the amendment during a Lords debate on international women’s day, no Government peers rose to support her. Although I entirely agreed with the principles laid out by the Minister, it is a little bit rich for her to claim that Lords amendment 86 is part of some grand strategy, when it was simply a reaction to an impending defeat in the other place.
Notwithstanding that fact, an important step has been taken, and if Baroness King was willing to heap praise on the Government for their athletic U-turn, who am I to stand in the way of recognising that in this area, as on pub companies, the Government may have taken some time to get there, but they have got to the right place in the end?
Andrew Griffiths: I draw the House’s attention to my chairmanship of the all-party group on beer, and to my entry in the Register of Members’ Financial Interests.
This has been a contentious and on some occasions ill-tempered debate. That is a great shame, because ultimately we all want the same thing—to achieve a thriving industry. We want British pubs to succeed, to
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reduce the number of pub closures that have gone on over decades in this country and to stop such closures taking place. We need legislation that will allow the industry to do that.
The Government have obviously listened to the will of the House. I put forward a particular view—I had concerns about the unintended consequence of the Bill—but the House took a different view. The Government have listened to that view, and they have been honourable in how they have proposed changes to the legislation. Nobody who voted on Second Reading can have any concerns about the Government not having done the honourable thing in listening to the will of the House, so I commend them.
We are all looking for the outcome that more pubs thrive, survive and are successful, but I just draw the attention of hon. Members to my concerns about unintended consequences. We have heard the phrase “the beer orders” on many occasions, and we have looked at what Lord Young and the then Government did in relation to legislation on brewers and pubs. The unintended consequence of that legislation was to put the industry in a worse position: it actually led to the creation of the pubcos that so many people now argue against vehemently, and it had a terribly detrimental impact on the industry and on the sustainability and profitability of pubs. I urge the Government, in continuing to develop their legislation, to be aware of the unintended consequences of their actions.
One particular point to which I draw the House’s attention is the issue of investment. This is an industry. Yes, we love our community pubs, which are an important part of our society, and we all appreciate the work they do in our constituencies. However, such pubs have to be viable—profitable and successful—businesses for the people who invest in them. We all recognise that in the modern world, where there is the constant redevelopment and repackaging of the offering in the service industry, be it from Starbucks, Costa Coffee or the local pub, there is a dramatic need for investment. If a pub does not have investment, looks shabby and down-at-heel, does not feel modern and is not well-kept, the public will vote with their feet. They have so many other places to go to. They can enjoy their time at home or go to one of the many coffee shops, restaurants and other premises on the high street.
Investment is essential if we are to develop our pub estate, improve the offering and the customer experience, and encourage more people to use the pub. That is what we have to do. The reality is that people are drinking less and going to pubs less. We have to allow the industry to provide a product that encourages people to leave their homes and visit our pubs. Investment is essential if we are to achieve that.
I therefore urge the Government to look carefully at the secondary legislation that they bring forward. We need the companies that are investing in our pubs to have certainty. Investing in a pub can cost more than £50,000 and in some cases as much as £150,000 or £200,000. If companies are to make that investment, it is essential that they have some certainty about the return on their investment. If we cut off the supply of investment, it will be to the detriment of our pubs and we will see them go backwards. I therefore urge the Government, when they come forward with secondary legislation, to listen to the industry. It needs certainty.
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Greg Mulholland (Leeds North West) (LD): It is a pleasure to speak at the final stage of this important Bill. I shall of course speak about the pubs code. I am delighted that there is a string of amendments from the other place which I and my colleagues on the all-party parliamentary save the pub group and the Fair Deal for Your Local campaign can support and welcome.
I thank all Members from all parts of the House who voted for the market rent only option on 18 November 2014, which will go down as a historic day for the British pub. I thank the hon. Member for Chesterfield (Toby Perkins) for bringing his side firmly behind that proposal. I especially thank the Government Members who had the courage to defy their Whip in what was the only defeat of the Government Whip in this Parliament.
I warmly welcomed it when the Government said that they would accept the will of the House. However, as most right hon. and hon. Members know, it appeared that that would not to be the case a few weeks ago. I and others expressed concern when, at the Grand Committee stage in the House of Lords, we no longer had a workable market rent only option that would definitely be introduced at a certain trigger point. We had to get that back into the Bill and we did.
I thank my right hon. Friend the Secretary of State for Business, Innovation and Skills, the Under-Secretary of State for Business, Innovation and Skills, my hon. Friend the Member for East Dunbartonshire (Jo Swinson), and all the other Ministers, including the Minister for Business and Enterprise. I thank the whole team who have worked on this issue. It has been a challenge for all of them to balance the different views. In the end, they have achieved that. They have achieved something remarkable: a proposal that people accept will be the future of the tied pub sector.
I must express a few notes of concern because this is not the end of the matter. I was not sure whether to raise a pint this evening or next week when the Bill has gained Royal Assent, so I have decided to do both. This is not the end of the matter, because we still have the passage of the statutory instruments and the consultation over the pubs code, which will take a year. I and others will certainly be engaged in that. We understand and support the principle, but we must get it right.
Let me say firmly that there must not be any watering down of the fundamental principle in the Bill—[Interruption.] As the hon. Member for Hartlepool (Mr Wright) said, that would be as disgraceful as watering down the beer, and just as illegal. We must ensure that that principle is honoured, whoever is in government after the election—a question that none of us can answer at the moment.
I wish to say quite forcefully that we must not be fooled by the idea that somehow the beer orders were the problem; it was the watering down of the beer orders as a result of industry lobbying that led to the tragedy and disaster of the beer orders. That watering down happened in the House of Lords, and I am delighted that this time we have collectively managed to stop it. It was precisely that watering down, with large companies saying, “Okay, well you’re going to legislate the beer orders, but give us that loophole and allow us to have that freedom if we don’t brew beer”, which led to the problem, although I believe we have avoided it this time.
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A number of changes have been made to the clause, but it does not apply to all tenants of large companies as we intended it to. If someone exercises their right to take the market rent only option, they suddenly exclude themselves from any protection under the code, which seems strange and perverse. Despite all the sound and fury, the market rent option is only the right to an independent rent assessment on a free-of-tie basis, and the right to pay that. There is no logic in saying that it should apply only to tied or part-tied tenants, and not to any tenant who believes that they may be being exploited at their rent review.
The loopholes in the beer orders are the problem, and an obvious loophole—a new vehicle for some of the large, less scrupulous companies to exploit—allows companies to have excessive rental only agreements and excessive costs for insurance. There is an insurance scam in parts of the industry whereby people are forced to pay considerably more for insurance to their pub-owning company, even on a free-of-tie basis, than they would if they got insurance on the open market. The Government must be aware of that.
Clearly we would have liked the sale of a pub to be a trigger, but I welcome the fact that the Government have sought to deal with the issue. We shall look further at the detail of the measure because there is a problem with companies, including developers, buying pubs and using the terms of tied agreements to force people out of those pubs so that they can get vacant possession and develop a site. There is a danger that large companies will seek to use the loophole to put themselves deliberately into administration, restructure and form smaller companies that would come under the limit, and then carry on business as usual.
Investment is clearly a big issue, and I have had helpful and sensible discussions with Heineken, Greene King and Marston’s—all sustainable companies that will continue to survive and thrive. As I have made clear, it was never our intention to stop or discourage investment in pubs, and one of the biggest problems of the tied pubco model was the grotesque lack of investment—those scruffy pubs with the threadbare carpets that people could tell were Punch Taverns or Enterprise Inns pubs. Investment was left to the tenants, but they were not able to invest anything in their pub. James Baer of Amber Taverns said that the large companies were walking around with as much debt as Lance Armstrong had dope in his arm, and that that was one of the biggest problems in the pub sector—stopping investment in pubs.
The intention behind our clause was always that if two partners agreed an investment, there would be a new rent and therefore no need for a rent review for another five years. We must avoid any sense that the market rent only option can or will be waived for investment that happens before a tenant signs an agreement, or signs up to one during a tenancy at will. Often the previous tenant asked for that investment but it was refused, even if it should have been made anyway to keep the pub in a fit state to let in the first place. That is not the kind of investment we should be talking about.