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Westminster Hall

Wednesday 9 March 2016

[Mr David Nuttall in the Chair]

BT Service Standards

9.30 am

Caroline Nokes (Romsey and Southampton North) (Con): I beg to move,

That this House has considered BT service standards.

It is, as ever, a pleasure to serve under your chairmanship, Mr Nuttall, and I express my gratitude to Mr Speaker for having granted this debate. I am conscious that there are many colleagues here today and presumably, because of their attendance, they have experienced similar problems to those that I have in my constituency. Those issues centre on BT’s inability to deliver its service obligations to its customers—our constituents. I reassure hon. Members that I intend to be generous with my time and in taking interventions, because I know that this subject fills many of our postbags. Lucky constituents have the ability to send us emails, although some of my constituents in Romsey and Southampton North have resorted to quill pen and ink, such is their frustration with their poor service.

I make it clear from the outset that this is not about broadband, although I will mention it, and I am sure that will give colleagues an opportunity to vent. Instead, I plan to focus on the myriad problems my constituents have faced over the course of the last 12 months and, in some cases, BT’s inability even to seek to rectify faults. Its contractors have repeated errors that have caused mayhem in some villages in my constituency.

Julian Knight (Solihull) (Con): I congratulate my hon. Friend on securing this important debate. I was prompted to rise when she mentioned the limits of the service, in terms of faults not being rectified. In my constituency, a 99-year-old lady’s phone line was down, but BT refused to send an engineer. Thankfully, my office forced it to send one in. After the work was done, however, she had a stroke. Her son managed to make phone contact to discover that, but it could have been so very different if the line had not been fixed and her son had been unable to get through. She could have died without immediate assistance, and that shows the importance of phone lines.

Caroline Nokes: I thank my hon. Friend for that contribution. He makes a really valid point: we rely on our telephones, and not simply to make social calls or to run businesses. They also enable a huge number of elderly people, through modern technology and particularly through their personal alarms, which are connected to the phone service, to live independently and safely in their own homes and to alert relatives to a problem simply at the push of a button.

Inevitably, I will conclude with some specific questions for the Minister and even some suggestions about what BT are doing well, but perhaps might do better. I welcome the publication by Ofcom last month of its review into digital communications, which came after I had applied for this debate, but before I heard that it had been granted. In many respects, the review addresses some of the

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significant criticisms that I will make today of BT. I was particularly pleased to see its headline point: that Ofcom intends to introduce tougher rules on faults, repairs and installations; transparent information on service quality; and automatic compensation for consumers when things go wrong.

Anne Marie Morris (Newton Abbot) (Con): I congratulate my hon. Friend on securing the debate. She is making a very good point, but in my constituency, I had a case that was not about the system that was in being repaired, but about no system being put in at all. For six months, residents in a new housing development had no telephone and, to cap it all, they also had no mobile signal, so they were effectively cut off. Until I got involved, absolutely nothing happened.

Caroline Nokes: My hon. Friend is absolutely right to point that out. Like me, she represents an area with enormous rural parts where the mobile signal is often patchy, shall we say, at best. It is absolutely true that in cities, it can perhaps be less serious if there is no working telephone connection, because mobile coverage is better—not perfect, but better—but in villages, there is often no mobile signal at all. I am sure that we all share the frustration that our constituents do not get the satisfaction that they are looking for from BT until they turn to us.

As I was saying, I welcome the intent expressed by Ofcom, but I ask the Minister to ensure that it is delivered promptly and with absolute rigour, and that Ofcom publicises widely the manner in which customers might communicate with it about faults, the length of time that it takes for repairs to be done, and importantly, transparency of information.

It would not be a debate in Westminster Hall if I did not have a quick trip around the geography of my constituency and the myriad faults and problems that have occurred.

Mike Kane (Wythenshawe and Sale East) (Lab): I congratulate the hon. Lady on securing the debate. Does she agree that the trouble is that in 2015, BT reached all its targets as prescribed by Ofcom? Is there perhaps something wrong with the targets prescribed by Ofcom and not just with BT?

Caroline Nokes: The hon. Gentleman’s point is very important, and actually, we want the targets to be much higher. We live in a world where consumer demands are getting greater by the day. We expect incredibly high levels of customer service, and companies such as BT should be able to respond to that and have stretch targets to make sure that they are delivering the sort of communication services that we can reasonably expect in the 21st century.

Jack Lopresti (Filton and Bradley Stoke) (Con): I congratulate my hon. Friend on securing this very important debate. This is not just about targets, but about attitude and the way that people are dealt with. A constituent of mine paid a deposit for a phone line but the line never arrived, and she was sent several bills. In the end, BT refused to respond to any complaint from her and called in debt collectors. It was sorted out only when I intervened. This is a shocking state of affairs, as I am sure my hon. Friend would agree.

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Caroline Nokes: My hon. Friend makes a good point that when services are ordered, there is an expectation that they will be installed. I can think of a case in my constituency where a customer’s order was accepted, but they were told that they could not have it delivered because they were in such a remote location, yet the properties on either side of the customer both had phone services. It just required my input, yet again, to say to BT, “Come on, you can do this. This isn’t the middle of nowhere; there is a telephone network running down the road.”

I turn first to the village of Sherfield English, which is a settlement of about 400 houses, in a linear development, where there has been very little house building over the past 10 years. However, with the increase in people working from home, or perhaps running small businesses, which we would all seek to encourage, there has been growth in the demand for telephone lines. It appears that BT has struggled to keep up with that demand, but rather than telling potential customers that they cannot have a new line and acting transparently, it has accepted the orders. There have then been repeated incidents of contractors working on behalf of BT simply extracting an existing line’s connection to the cabinet and putting a new one in in its place.

I refer in particular to my constituent, Mr Ian Forfar, to whom that has happened four times. I assume that his connection must be at the top of a row of connections within the cabinet. He is now on first-name terms with many members of staff at BT and is in the habit of stopping at the local cabinet when passing if he sees someone working on it, just to check that his line is not about to be disconnected again. Mr Forfar is an extremely articulate, determined man—a man who is not to be messed with. He has provided me with a very clear timeline of all the events that have impacted on his telephone service over the last year or so. Each time he has gone home and found his line dead, it has been because a third-party contractor has taken out his connection in order to provide a new line for a new customer. Mr Forfar was promised a full investigation last year of what was going wrong in Sherfield English, but then the regional manager went on holiday and Mr Forfar heard no more. It comes to something when, earlier this year Mr Forfar’s line went dead for a fifth time, and he was celebrating because it had been caused by a branch that had fallen across the line.

Lack of capacity seems to be a real problem, and it is not just limited to the rural parts of my constituency. Cabinet No. 7 in Bassett, which is right on the edge of Southampton, has suffered from a lack of availability of new lines, as well as many other faults. Again, one of my constituents—this time a local councillor, Alison Finlay—has provided a very detailed timeline of events, which dates back as far as 2011. In common with the constituents in the middle of Romsey, the cabinet seems to provide a variable service, especially when the weather is not good. I do not know why rain should be such a problem, but as Councillor Finlay puts it:

“I mentioned that care would need to be taken when dealing with Cabinet 7 as my constituents experienced variable levels of telephony…from it, especially during winter months.”

As we heard earlier, many elderly residents are dependent on the telephone line being in good working order for their personal safety alarms. Without a connection, if they push the button on their alarm in the case of a fall

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or other incident, help might not be just minutes away; in the worst cases, as my hon. Friend the Member for Solihull (Julian Knight) said, it could be many hours or even days away. None of us wants that for our more elderly residents. Independence and the ability to stay in their own home is wonderful and technology today can provide great peace of mind for elderly people and their relatives, but that is dependent on having the network to back up the technology.

Cabinet 7 in Bassett was long scheduled for an upgrade. Indeed, in 2011, Councillor Finlay first flagged up the problems, and the fact that care would be needed with any changes and that they would have to be done with extreme caution because they were known to be very delicate. In December 2015, the cabinet was finally upgraded, after many delays and false deadlines. Sadly, that is not the end of the story because, in January, about 30 households were cut off for four weeks, lines were crossed and, according to Councillor Finlay, only a semblance of service was restored.

That is similar to the almost entertaining, interesting experience of the residents of Up Somborne. A few weeks ago, most of the village’s lines were crossed and neighbouring households were providing a message service to one another as lines were swapped and numbers were redistributed, apparently randomly. The spectacle of neighbours running up and down the road passing messages to one another may sound amusing, but in the 21st century it is not acceptable.

BT’s obligations are very clear. For telephony, it has a universal service obligation, meaning that basic telephone services should be available on request for a reasonable fee. For broadband, a universal service obligation is not yet in place, but is on its way for 2020 and I warmly welcome that. However, I question how well BT is meeting its obligation to provide a basic telephony service when residents are cut off for four weeks, poor Mr Forfar is a repeat victim of being cut off and residents of Up Somborne are running round the village passing notes to one another.

I am sure that every hon. Member present this morning is here because they have experienced exactly the same sort of problem and their constituents have turned to them because they cannot get satisfaction on their own. That is why the Ofcom review, published two weeks ago, is so important. Ofcom intends to introduce tougher rules on faults, repairs and installations, and I welcome that, but an intention is all very well. I urge the Minister to ensure that there is a stringent timescale for when that will be achieved.

Customers—constituents—want and deserve transparency. They want to know when they can expect a repair to be effected. They also want an automatic right to compensation at a level that is published, clear and available for anyone to check. I am always at pains to point out to constituents that, when service has been interrupted or orders placed and not fulfilled, they are entitled to compensation, but people have to know that to ask for it. How much better an automatic refund will be.

It is interesting to note from Ofcom’s “Strategic Review of Digital Communications” that dissatisfaction with BT is at its highest in rural areas and that slow repairs and installations were the single biggest issue that consumers raised in the review. We all know about the automatic right to compensation for other services, such as electricity, gas and water. Customers left without a phone line often

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describe it as being akin to a power cut, so reliant are we now on telephone services. So it is good news that Ofcom

“intend to introduce automatic compensation”,

but my question to the Minister is: when?

The review rightly comments that the landscape of digital communications has changed beyond recognition in the 10 years since the last comprehensive review and I suggest that the gap between large-scale reviews is too long. Perhaps the Minister will urge Ofcom to carry out such reviews more regularly. Given that the new universal service obligation for broadband was announced last November for implementation by 2020, five years would seem to be a reasonable interval. Technology, price and availability change so fast that a decade can seem a lifetime.

Expectations of quality and customer service are rising exponentially and rightly so. We have a technologically literate and demanding customer base whose requirements grow every time a new platform is released. I welcome the news that BT is seeking to bring the vast majority of call centres back to the UK by the end of the year and I congratulate it on that effort to address some customers’ genuine complaints in that respect.

Inevitably—this will not surprise the Minister—I cannot resist making a small reference to broadband because it would be remiss of me not to. There have been many debates in this place and in the House on broadband, its roll-out in rural areas and the great digital divide between the haves and the have-nots: those who are on more than 2 megabits and those who do not receive even that.

The week before last, I received a set of statistics that seemed to suggest that only 1.8% of households in my constituency were receiving less than 2 megabits and I worked that out to be in the region of 700 households. Given the number of complaints I have received, I think I must have been in correspondence with every last one of them. In fact, BT’s own figures show that the number is many times that. Around 20% of my constituents do not receive 2 megabits, and this is in Hampshire, not the Outer Hebrides—[Laughter.] I suspect we are about to hear from the Outer Hebrides. Barton Stacey in my constituency is less than 70 miles from Westminster, but my constituent, Mr De Cani, has been told that he can no longer expect to receive broadband at all. That is despite BT’s accepting his order, delivering a painfully slow and intermittent speed for a while, and now throwing in the towel and saying he is just too far from the cabinet to expect any service.

Julian Knight: On cabinets and their location to customers, a number of small businesses in my constituency have told me that BT is refusing to connect them to cabinets outside their premises. Clearly, that is not good enough from BT and is beginning to have a negative impact on small businesses in Solihull and employers across the country. Does my hon. Friend agree that, when the infrastructure is in place, it is unacceptable for BT not to connect to a cabinet that can be seen from the premises?

Caroline Nokes: My hon. Friend makes a good point. There are examples in Romsey of industrial estates with exceptionally low speeds where customers can see the cabinet on the other side of the road. They desperately want to be connected, but for business customers the regime is wholly different. I have specifically restricted

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my comments to residential customers, but my hon. Friend makes a valid point. A number of people running very small micro-businesses from home are hugely affected.

There are too many people like Mr De Cani, there are too many properties without access to the services we take for granted, and there are too few solutions coming forward. Mr Blake of East Wellow makes one plea to BT and it is a good one: the technology exists. He works for IBM and went on a tour of a BT facility in Ipswich where he saw the G.fast mini cabinet, which can be placed on a telegraph pole and has the potential dramatically to increase speeds.

Another constituent was here yesterday as part of the SET for BRITAIN student competition and was show- casing her work, which puts amplifiers on fibre optics to increase capacity dramatically. These changes are all coming but we need to make sure they can be trialled. Mr Blake would like to put in a plea to BT today for a G.fast cabinet in Gardeners Lane, East Wellow. It is a fantastic idea and he is very happy to be part of any trial. In places like West Tytherley, communities are coming together and seriously looking at how to arrange wayleaves, dig ditches, lay cable and bypass BT altogether. When that happens, we know that things have got pretty desperate.

My final comments relate to Hampshire and Isle of Wight air ambulance service, which operates from Thruxton, just north of my constituency, and RAF Benson, but provides services across the whole county of Hampshire and the Isle of Wight. To put in place the required high speed broadband and the necessary telephony at its new, upgraded base at Thruxton, the air ambulance service must liaise with BT to get Openreach to do the installation. No direct contact with Openreach is possible and the air ambulance service tells me that its attempts to make sure South Central ambulance service, the Hampshire and Isle of Wight air ambulance service and the operators, Bond Air Services, all have their connection done at the same time to minimise costs have so far been fruitless. It just requires a bit of joined-up thinking and co-ordination to make sure that the trench digging and installation are all done together. I am sure BT will be listening today and will ensure that it happens. When considering the essential and life-saving services provided by the air ambulance service and the lack of coverage by mobile phones in that sort of rural area, a BT solution needs to be provided.

I want to ask the Minister three specific questions. We all welcome the Ofcom review into digital communications, but some timescales should be set for the introduction of automatic compensation for our constituents. I would like consideration to be given to more frequent reviews. As I said, the last Ofcom review was 10 years ago. The landscape changes so fast that every 10 years is not often enough. And I ask that BT be encouraged to continue making the changes that customers want. As I mentioned, 80% of its call centre handling will be done in the UK by the end of this year. That is certainly something that customers are seeking; they feel frustration at the current situation. However, it must be about providing a level of customer service and reliability that we all expect in the 21st century.

9.50 am

Corri Wilson (Ayr, Carrick and Cumnock) (SNP): My constituency of Ayr, Carrick and Cumnock is predominantly rural, although it hosts a number of

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small towns, the biggest of which is Ayr, where my constituency office is located. Ayr is home to some 47,000 people—the eighth highest population of any town in Scotland—and is less than 40 miles from Scotland’s largest city, Glasgow. We have a lot to offer visitors and businesses alike, but unfortunately an adequate phone and broadband service is not one of them.

It is astonishing that a town such as Ayr should be unable to provide small businesses and households with a reliable telephone and internet service, but that is the case, and Ayr is not alone in this in my constituency. I receive many complaints from residents and businesses, from places ranging from Barr to Ballantrae, Coylton to New Cumnock and Dalrymple to Dailly. There are villages in my constituency with no mobile phone signal from any provider and no broadband capacity, either. Ofcom states that more than eight in 10 UK premises can now receive superfast broadband. That may be true in the rest of the UK, but it is certainly not the case in Ayr, Carrick and Cumnock.

My constituency office, for example, has not had a reliable working telephone line or a reliable internet connection for the past seven months. After working out of temporary premises since May, I wanted to retain the phone number and set up internet access—a simple request, one would think, but apparently not. I was advised by BT that the number would be transferred over without any disruption to the service. That smooth transfer did not happen. Both offices, old and new, were without a phone line and internet connection for well over a week. It turned out that there was no live line into the building, and thus there was a further delay while one was installed. During that entire period, almost every phone call to BT resulted in a new account being set up and a new hub being posted out. The number of accounts has reached double figures, and I am not sure what I am expected to do with the mountain of hubs in the office.

Next, the parliamentary IT team came in to set up the computers—and on that day, BT chose to disconnect me again. It seems that in an attempt to rectify the growing number of accounts, it tried shutting some down and left my team uncontactable for another few days.

All the while, I was receiving bills, both paper and online. Some days I would receive three or four bills, all for different accounts and different amounts. It seemed that the bills were multiplying faster than the accounts being opened. Although helpful and polite, the customer service staff were at a loss as to which bills were valid, which accounts were active and which hubs should be connected. Customer service even called us on a number that it claimed did not exist. We had the irony of BT leaving cloud voice messages, which I received via email, stating its frustration that it could not get through to my office.

We took BT at its word and bought into a package. The cloud phones are now plugged in—although not actually connected—to a further new line that BT had to install. All our IT equipment regularly drops out of service. In some cases, staff have even had to use their own broadband connections at home. Just yesterday, staff yet again arrived at work to find the whole system down and BT support again at a loss to explain what had gone wrong and how to fix it. This morning, I have

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staff connected to two different hubs to access the internet. One of them is not even plugged in to anything, so I do not know how that works. I have no idea how many accounts I currently have with BT, and neither does BT. Although customer service staff continue to be helpful, no one seems able to see the big picture, and we get moved from the broadband department to the cloud department to the telephone department to the maintenance department—and then we start all over again. My staff have wasted hundreds of man-hours on this issue, and that is not to mention the number of dissatisfied constituents who are unable to get through to my office for help.

If that is the level of service received by the MP for the area, it is little wonder that my constituents are at the end of their tether, too. My case load continues to grow with similar problems, and we have no sight of resolutions. As an MP, I have a job to do, but my ability to do it well is being hampered by BT’s inability to solve these issues. I feel powerless to help constituents with their BT issues when I cannot even resolve my own. It seems to me that BT has a long way to go to reach an acceptable level of service for the people and businesses in my constituency and, as this debate demonstrates, I am clearly not alone in that belief.

Mr David Nuttall (in the Chair): I intend to start calling the Front Benchers to sum up the debate at about 10.30 am. I do not want to impose a time limit, but I will have to if hon. Members speak at great length. If contributions are about five minutes long, we should be able to fit everyone in.

9.55 am

Huw Merriman (Bexhill and Battle) (Con): It is a pleasure to speak under your chairmanship, Mr Nuttall. I congratulate my hon. Friend the Member for Romsey and Southampton North (Caroline Nokes) on initiating this important debate on BT service standards.

I represent the rural constituency of Bexhill and Battle, which is 200 square miles of East Sussex. In that constituency, we badly need more business in order to get the business rates that will ultimately be required for the constituency to stand on its own two feet. Unlike parts of Kent and parts of West Sussex that neighbour us, we do not have large towns that boost our constituency with business rates, so we badly need to attract more business to the constituency, but not just because we have to stand on our own two feet. As 28% of the population of the constituency is over the age of 65—the national average is 17%—we also need more business rates to fund our ageing population, who are vulnerable and rightly need more care and more resources. As well as needing a dualled A21 and high-speed rail, we need to ensure that our phones, our internet and, indeed, all our infrastructure, for both home and business, are properly funded and properly working in order to attract business into the area.

In the constituency, we also do our best to attract key workers, and those with money to spend, through the work-from-home concept. The commute is long, as I know on a daily basis, but we can attract people on the basis that members of our community can work from home. However, for them to come down to the area and build up their business, it is essential to have these basic provisions in place.

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I welcome the moves that East Sussex County Council has made with its eSussex programme, through which it provides funding for the harder to reach parts of my constituency. Its aim is to deliver 660 square miles of broadband provision for 66,500 premises. I also welcome the Broadband Delivery UK programme that the Government have rolled out. Ultimately, however, we need BT to perform, and to perform better.

I shall give a few examples of where things have failed for us and how that will have an impact on our business infrastructure. I was contacted yesterday by NFF, a fencing company on the border of my constituency that is doing incredibly well and is looking to expand into my constituency. It takes on apprentices through an apprenticeships programme and helps to support those who are just leaving school. However, it cannot expand if it does not have the ability to connect its sales hub to the main hub in the constituency, and as a result it is stymied in making progress. It was told two years ago that it would be connected, but still nothing has happened, and—this is also difficult when businesses are trying to plan—it does not have a timeline for when something will happen. I want BT to do something for such businesses. Surely BT should work on the basis of prioritising the businesses that are boosting our local economy, rather than just missing them out. There should be a way of prioritising those companies.

Difficulties are also experienced by constituents who are not using BT, but are using companies that use BT’s infrastructure. They are moved from pillar to post on whether the issue is the fault of BT or the service provider. Again, my constituents are experiencing a lack of clear communication that is driving them to despair.

There are rural areas within my big rural patch, Brightling, Dallington and Mountfield, which have little coverage. I met with my parish councillors to work out how we can do better, and they have some fantastic ideas of where innovation could deliver to the parts that BT cannot reach. To that extent, I note that many contracts are being supplied purely to BT, rather than to some of the more innovative solution providers. I would welcome the Government looking into how more competition could be created in the sector so that BT does not end up with every single rural fill-in contract.

My constituency includes the Rother levels, where the problem is not only broadband. Constituents have huge difficulties using any phone. As my hon. Friend the Member for Romsey and Southampton North mentioned, phones can be the lifeblood of many constituents. BT was good in the sense that it did an engineering project to try to work out what the problem was, but it found nothing, which perplexed many of my constituents.

As a Member of Parliament, I want to help BT to do better and to work in partnership with it. I am delighted to be setting up a parish council conference to which I will invite all my parish council heads to meet with BT, our county council and some of the more innovative service providers. We will try to match solutions needed by parishes with a provider that can deliver that at, perhaps, a better cost than BT. I welcome co-operation with BT to improve its service standards. It can do better and I urge it to do so.

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10.1 am

Jim Shannon (Strangford) (DUP): It is a pleasure to speak in this debate. Thank you for calling me, Mr Nuttall. I thank the hon. Member for Romsey and Southampton North (Caroline Nokes) for clearly setting the scene. In my constituency, I have experienced all the issues that she and other hon. Members have described. In fact, my experience almost equals the points she made. We have to deal with BT’s service team, which is quite a challenge. When it comes to faults and repairs, we phone them and then we phone again. They tell us that they have been out so we phone the constituent, and he tells us, “No, they haven’t been out.” Then we have to phone BT again to ask, “When were they out and what did they do?” That goes on ad infinitum. It is a real problem.

BT is one of the nation’s most popular service providers. It has a competitive advantage as it was born out of the longest established communications provider in the country, yet in many ways it is just as bad as the rest of the pack when it comes to service standards.

Mr Gregory Campbell (East Londonderry) (DUP): BT uses its competitive edge to try to take Sky’s customers, particularly regarding televised football. Does my hon. Friend agree it would be better if instead of—or maybe as well as—doing that, some of those millions of pounds of expenditure were diverted into improving the infrastructure, about which we have heard so many complaints this morning?

Jim Shannon: As always, my hon. Friend’s pertinent point gets straight to the kernel of the issue. I agree with him wholeheartedly.

In the free market of communications, of course, consumers can vote with their feet but that is not to say the Government have no role in ensuring proper service standards that customers of any business would expect. I always try to mention statistics because they reinforce the issues that I want to underline. Statistics published on 15 December 2015 show that in the third quarter of the year, Ofcom received 22 complaints about BT per 100,000 customers for landline telephone services compared with an average for 17 per 100,000 across all other operators. It also received 35 complaints about BT broadband services per 100,000 customers compared with an average of 22 per 100,000 customers across all operators. As the hon. Member for Romsey and Southampton North said, that clearly indicates the level of complaints and the discredit to BT.

Clearly BT is not up to standard on its service standards and Ofcom, as the regulator, has to do something about that, as I will mention later. To help bring about the change that is needed and deliver real competition, BT Openreach will be required to open up telegraph poles and ducts that it uses for its fibre and telecom lines. Rival providers will now be able to use the ducts and poles for their own fibre networks to connect them to homes and offices. If and when that is in place, it will be positive and will be great for competition—and it might finally push BT to get its act together. The figures on BT’s poor customer service show that it has abused its dominance for too long and, despite being aware of its poor service, it has not done enough. Indeed, many of us would say that it has done almost nothing.

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The hon. Member for Romsey and Southampton North referred to the call centres. I get many complaints about call centres—about their distance, communication and the time that people spend on the phone. The hon. Lady said that she spoke to three people and then went back around again. That is so often the case, and it is so frustrating.

In reply to a supplementary question on superfast broadband last Thursday, the Minister mentioned that my constituency has an 85% connection to superfast broadband. Many of the employees of small and medium-sized businesses in my constituency who work from home would like better than that, and I would like the Minister to respond to that.

Openreach is part of BT Group, but has obligations to treat all its customers equally. Ofcom introduced that structure in 2005, and it has delivered benefits such as stronger competition. However, the evidence from Ofcom’s review shows that Openreach still has an incentive to make decisions in the interests of BT, rather than BT’s competitors, which can lead to competition problems. Perhaps the Minister could respond to that point because it is important. Ofcom’s duty is to look after the customer but we are not sure whether Openreach is doing that in a very balanced way.

To achieve better customer service, Ofcom has outlined the ways in which it will regulate Openreach and BT to ensure better service standards. It says:

“First, Openreach will be subject to tougher, minimum requirements to repair faults and install new lines more quickly.”

Well, we need that today; if Openreach did nothing else but that, it would be a step forward. Ofcom continues:

“These will build on measures introduced by Ofcom in 2014, but will set…minimum standards and extend to other aspects of performance, such as how often faults occur. Second, Ofcom will introduce performance tables on quality of service, identifying the best and worst operators on a range of performance measures so that customers can shop around with confidence.”

In the background information we received, Ofcom said that it wants customers to be automatically compensated for service failures, that it is setting tough minimum standards for network performance, and that it will report on which are the best and worse phone and internet providers. It is good to do all those things, but I would like a response to all those points.

Ofcom intends to introduce “automatic compensation” when things go wrong. It says:

“Broadband, landline and mobile customers will no longer have to seek redress themselves, but will instead receive refunds automatically for any loss or reduction of service.”

That is good news.

Ofcom are to come back later this year with the finalised plans of how to implement the proposals and, although it is long overdue, constituents across the whole of Strangford, the whole of Northern Ireland, the whole United Kingdom of Great Britain and Northern Ireland and, indeed, my own office—we regularly phone BT about problems—will take comfort in this after having issues with BT for some years now.

I await this issue coming back before us with Ofcom’s proposals on how to implement its recommendations. It is good to have such recommendations but we need an implementation procedure. I remain encouraged to see

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greater consideration given to the largest communications provider in the country and I look forward to building on today’s positives.

10.7 am

Kelly Tolhurst (Rochester and Strood) (Con): It is a pleasure to serve under your chairmanship, Mr Nuttall. I thank my hon. Friend the Member for Romsey and Southampton North (Caroline Nokes) for securing the debate. My constituents will be extremely interested to hear about some of the challenges that she faces in her constituency, which she summarised well.

Rochester and Strood is very close to London—only 26 miles away. My constituency has very highly urbanised areas and quite a lot of rural areas. In some parts, such as Allhallows, it is very touch and go as to whether people can get any kind of mobile signal so, although the area is geographically quite close to urban areas, it is remote within my constituency.

I am pleased to hear that I am not the only MP struggling with the live issue of getting telephone communications sorted in their constituency office. I am expecting—hopefully tomorrow—to have a telephone line installed in my constituency office. However, on previous visits, the engineers have been unable to find the connection in the building, which apparently had a line connected previously. I very much hope that tomorrow I will be up and live with a telephone line in my constituency office. At the moment I have a number but not the mechanics.

Not so long ago, just prior to becoming an MP, my business was planning to move offices within the same site—perhaps only a couple of hundred metres—in my constituency. We thought, “Well, we won’t do it ourselves. We’ll get BT in to do the move for us.” We thought that would be quite easy and that BT would just move the line from one building to another a few hundred metres away. Sadly, BT decided to cut off the existing line, resulting in our having a very poor service and no internet connection for up to six weeks, which was a difficult situation to resolve. So I have experienced some challenges in the delivery of telephone services.

Broadband has become a significant issue in my constituency. Some 74% of businesses in my constituency employ fewer than four people, so we are very much a small business economy. Like my hon. Friend the Member for Bexhill and Battle (Huw Merriman), we have to consider how our businesses are growing in the services that are provided. We are told that we are getting high speeds, but in reality, when I talk to businesses and residents, I find that at some of those properties we are not getting the speeds that BT says we should be getting.

A bigger issue is that large swaths of my town centres cannot get access to fibre broadband because BT tells us that it is commercially unviable to upgrade the cabinets. My constituents and I cannot understand why we can be in places such as Rochester town centre or the historical dockyard, where we have had new development —we have many microbusinesses and other growing businesses—and struggle to access the cabinets. I could understand the situation more if the rural parts of my constituency were struggling, because we all appreciate that such areas can have problems, but I would like to understand why some of the cabinets are not being upgraded and why BT has a clear view that the cabinets are commercially unviable. I would appreciate more information on that.

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Medway City industrial estate employs more than 6,000 people and makes a real economic contribution to my constituency. The industrial estate is growing and successful, but I am getting complaints from businesses about the large fees required to get any kind of connection at Medway City. We have a growing proportion of digital economy businesses in my constituency, and such businesses need good service and good access. I want to keep those businesses, because I want to grow such commerce in my constituency. Bearing in mind that we are 26 miles from London and that we are an urbanised area—we are not a rural constituency—we should be getting a better deal from BT.

My office has taken on some issues for my residents and businesses over the past 10 months, and my phone calls have always been answered by courteous and pleasant members of BT staff. They always seem to try their absolute best to resolve the issues that we have raised but, obviously, someone nice on the end of the phone does not always satisfy a constituent or business with an issue. How does the Minister intend to hold BT further to account on some of the questions raised today? I welcome this opportunity to touch on a few things that have happened in my constituency in recent months.

10.14 am

Martyn Day (Linlithgow and East Falkirk) (SNP): It is a pleasure to serve under your chairmanship, Mr Nuttall. I thank the hon. Member for Romsey and Southampton North (Caroline Nokes) for securing this timely debate. The issue of BT service standards is wide-ranging, but my interest is specific to one local area in my constituency, namely the village of Westfield in West Lothian.

The village is at the centre of the constituency and lies almost midway between Edinburgh and Glasgow in Scotland’s central belt, yet electronically it is almost cut off from society. There is huge investment in the roll-out of superfast broadband throughout Scotland, and through work with BT, Scotland is well on the way to becoming a world-class digital nation by 2020. Despite that ambitious programme, however, there remain a number of communities that the digital revolution is passing by. That was an issue some 16 years ago, when I first represented the village as a local councillor. Sadly, it is still an issue today, despite the efforts of local councillors, parliamentarians and the local community.

The heart of the problem appears to be the distance from the exchange and the supporting BT cabinet equipment. Cabinet 31, relatively nearby, will be upgraded to fibre within the next six weeks. Welcome though that it is, its distance from the village, being more than 1 km away, is expected to negate any benefit for most residents. For that village in the heart of Scotland, the issue is one of access to basic broadband, never mind superfast broadband.

I note with interest one of the conclusions in Ofcom’s recent strategic review of digital communications, published last month:

“Better broadband and mobile coverage. Ofcom will work with the Government to deliver a new universal right to fast, affordable broadband for every household and business in the UK.”

I welcome that recommendation, as will my constituents. However, the question remains, when will it become a reality for residents in villages such as Westfield? Ofcom has basically said that communications must work in the interest of UK citizens. As the regulatory powers to

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address market failure are reserved to Westminster, the UK Government need to do more to ensure that Scotland’s rural communities are not left behind.

Last month, the report of the Select Committee on Environment, Food and Rural Affairs on rural broadband urged the Government to set clear target dates for when the last 5% of properties will obtain access to superfast broadband. That is a sensible recommendation, and I urge the Government to take it on board. The experience in my constituency is a mixed bag. On the one hand we are in the top 20 constituencies for the highest fixed broadband speeds, but we are also in the bottom 20% of constituencies for access to superfast broadband. As I have said, some communities do not even get basic broadband. More must be done to ensure good basic services for all households in relation to broadband and phone coverage.

10.17 am

Brendan O'Hara (Argyll and Bute) (SNP): I congratulate the hon. Member for Romsey and Southampton North (Caroline Nokes) on securing this important debate. As the Member of Parliament for Argyll and Bute, an area covering 7,000 sq km of west Scotland, including 26 islands, I know only too well how much rural Scotland depends on BT for both landline infrastructure and the delivery and roll-out of broadband. Sadly—indeed, it is a sad thing to report—BT is all too often letting down its customers in my constituency.

We all have horror stories of constituents who have been promised everything but received very little or nothing. On the wild west coast of Scotland, where storms are commonplace and power shortages are a regular occurrence, other utilities act as an emergency service, but BT all too often acts as it always does: rather slowly and too inefficiently. Sometimes it takes weeks, or even months, to get a landline reconnected in my constituency—in an area where connectivity ranges between patchy and non-existent—leaving people entirely cut off. I know I am not alone in saying that my inbox is bulging with complaints from constituents about BT. My fear is that, particularly among the elderly, once my constituents do not have a landline, they cannot get to me quickly enough to seek my help. What is happening elsewhere in the United Kingdom is magnified many times over in rural Scotland, particularly in Argyll and Bute. My biggest concern is on the roll-out of broadband. Although I fully support the fantastic Scottish Government initiative to roll out broadband across rural Scotland, BT is all too often a stumbling block to that progress.

As the Member for Argyll and Bute, people would expect me to talk up my constituency, but anyone who has ever visited Argyll and Bute will know that that is a very easy thing to do. The scenery is stunning; we have wild open spaces, there are the lochs and the islands, and our locally produced food and whisky are the envy of the world. However, the reality is that we face a crisis in Argyll and Bute, and it is a crisis of depopulation. Our population is ageing and in decline, and we have to do something before it is too late. I am firmly of the opinion that the lack of connectivity is the single biggest barrier to our reversing that decline and beginning a recovery. At the moment, we cannot keep our young people and we cannot attract other people to move from other parts of these islands to Argyll and Bute.

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Carol Monaghan (Glasgow North West) (SNP): My hon. Friend will know, of course, that more and more of the school curriculum depends on reliable internet access. People do not even need broadband for that, but need at least slow speeds. Does he agree that without a reliable connection, schoolchildren across rural areas in Scotland could be put at an educational disadvantage?

Brendan O'Hara: I absolutely agree, and I will come on to that in a moment. My hon. Friend is absolutely correct, and my postbag is full of letters from parents of school pupils who are deeply concerned that their children cannot access the internet in the way that 90% of the country’s children can. I also constantly receive letters from businesspeople saying, “We were promised the roll-out would be here six or eight months ago, and it’s still not here. It is continually being put back.”

Jim Shannon: If broadband were rolled out in our constituencies in the way that we would like to see it, we would soon see small businesses that operate from people’s homes creating more jobs. Back in my constituency, people tell me, “We could get more jobs if we had superfast broadband across 100% of the area.” Does the hon. Gentleman have the same concern about his area?

Brendan O'Hara: The hon. Gentleman is absolutely correct, and we share many of the same problems and frustrations in attracting businesses to our communities. There are people who want to come and live and work in our constituencies but simply cannot, because we do not have the connectivity and the infrastructure to allow them to do it.

I do not want to appear melodramatic, but there is a crisis looming in Argyll and Bute, and we have to act now to avert it. All too often, when our young people leave for college or university—be it in Glasgow, Edinburgh or London—we simply cannot attract them back. Once they leave and go to an area where broadband and mobile connectivity are quite rightly treated as a utility, asking them to come home is like asking them to return to a place without running water or electricity. We would not ask someone to return to a place without running water or electricity, so why should we ask them to return to a place without basic levels of connectivity?

Similarly to the situation that the hon. Gentleman rightly points out, we are struggling to attract families and businesses into Argyll and Bute. Everything that a family would want is there—we have a clean environment, fresh air, wide open spaces, wonderfully welcoming communities and a safe place in which to raise a family—but we do not have connectivity. We do not have sufficient broadband or mobile phone coverage, and what aspiring and ambitious entrepreneur would bring his or her family to an area where they may have to rely on very expensive and not particularly efficient satellite broadband, with the limited usage that that would provide for a business? They simply would not do it.

As my hon. Friend the Member for Glasgow North West (Carol Monaghan) pointed out, parents who want the very best education for their children know that whereas 90% or 95% of children in the UK can access the internet freely through their smartphones, children in my constituency are once again disadvantaged because of the lack of connectivity.

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Last month, the Argyll and Bute economic forum, chaired by Nicholas Ferguson, who is the chairman of BskyB, produced an excellent, detailed and wide-ranging report. It concluded that the single biggest barrier to the development of Argyll and Bute is connectivity and pointed out that Argyll and Bute does not even have 4G coverage at a time that the Government are discussing how to roll out 5G. That emphasises how deprived we are.

My postbag is bulging with complaints about BT, and I am sure the same is true for many other hon. Members. This issue is far more than inconvenient for my constituents; I believe that it is a matter of our survival. BT has a responsibility to my constituents and to people in other rural constituencies to make sure it gets this right. This is a once-in-a-lifetime opportunity, and it cannot be allowed to pass. As I say, our survival depends on it.

Thank you, Mr Nuttall, for calling me to speak, and I once again congratulate the hon. Member for Romsey and Southampton North on securing this very important debate.

10.25 am

Alex Chalk (Cheltenham) (Con): It is a pleasure to serve under your chairmanship, Mr Nuttall.

The importance of the internet is hard to overstate. Its availability has an impact on small businesses, children who want to do their homework and people who want to engage in social media. If someone does not have superfast broadband, they do not just feel disconnected; it is almost as if they feel disfranchised.

The position in Cheltenham, which of course is not a rural constituency—it is the home of GCHQ, for goodness’ sake—is that in this day and age we still have pockets of real broadband blight. In Old Bath Road, Grace Gardens, Tommy Taylors Lane, Tivoli and Pittville, people are living in what I have described as e-poverty.

I am the first to accept that BT has connected up a huge number of people, but the real concern is that the e-rich are getting richer but the e-poor are being left behind. There are people on 24 megabits per second, for example, who are now being offered ultra-fast broadband. They have extraordinarily good internet connectivity, but there are significant pockets of people who are being left without any decent broadband at all. That, fundamentally, is the problem.

When we liaise with BT about the issue, it effectively says, “Well, look, it’s very difficult for us to go and deal with these ‘not spots’.” However, through Broadband Delivery UK and our local equivalent in Cheltenham, which is Fastershire, taxpayers have the money to step in and say to BT, “Right, go and fill in these ‘not spots’”, but that is not taking place. So this is not an issue of funding—the money is there, as are the will and the political backing—yet the logjam is not being broken. Consequently, we have this strange stand-off, with politicians saying to BT, “Look, there’s the public funding, these are the areas; we can explain to you which parts have not been connected, so please go ahead and do it”, yet it simply does not happen.

Meanwhile, MPs who have bulging postbags on the issue are given mixed messages. I was in an email from BT this morning, “Don’t you worry. There are zero areas in Cheltenham that have less than 2 megabits per second.” That is simply not correct. I recognise that a

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huge amount of work has been done, but that kind of messaging from BT causes a great deal of irritation. As I have said, this is not simply about people being inconvenienced. It is about people in my constituency saying that they will have to move, or that they will not be able to employ people, or that their children cannot do their homework. That kind of breezy disdain from BT is inflammatory and causes real difficulties.

I end with a plea. Given that the funding from the taxpayer is there and given that BT has there wherewithal to step in, I really hope that heads can be knocked together so that the remaining areas in my constituency can be covered. As I have said, Cheltenham is the home of GCHQ, and consequently somewhere that people might expect a decent broadband service. The time for action is now.

Mr David Nuttall (in the Chair): Before I call Calum Kerr to begin the Front-Bench speeches, I remind Members that I would like the mover of the motion to have a couple of minutes to sum up at the end. I ask the Front-Bench spokesmen to bear that in mind when making their remarks.

10.29 am

Calum Kerr (Berwickshire, Roxburgh and Selkirk) (SNP): I am happy to get the opportunity to respond to the debate for the Scottish National party. I do so in a couple of capacities. First, I am the SNP’s Environment, Food and Rural Affairs spokesperson, and nowhere is the digital divide felt more acutely than in rural areas. Secondly—I have to declare an interest—before I came to this place with my slender 328 majority, I worked in the telecoms sector for 20 years, starting off with a Dutch company but working mostly with Canadian and American companies. The subject is therefore close to my heart for many reasons.

I am pleasantly surprised by and happy with the way the debate has gone. If Members read the Library briefing and the SNP briefing—most Members will not have seen that—those documents had nothing to do with BT service levels. The debate has stuck to the subject, so I congratulate the hon. Member for Romsey and Southampton North (Caroline Nokes) on setting the right tone and everyone else on following it.

There are real challenges out there, and sometimes in Parliament we are guilty of just making a lot of noise and not putting forward proactive suggestions on how to make things better. Complaining about that to my party leadership got me the traditional response of, “Well, Calum, if you are not happy about it and you worked in telecoms for 20 years, why don’t you set up a group to go and look at it?” So we have an SNP MP group involving a number of people with a range of experience in the industry, and we are proactively trying to understand the issues at a deeper level so that we can come forward with constructive suggestions.

I congratulate the hon. Lady on securing the debate. I thought she set us off well with her tone and by talking about the importance with which this issue should be treated. A number of Members have spoken about the Ofcom report, which is important. It sets an intent and expresses the importance of that intent, but as she rightly identified, tougher rules, transparency and compensation need to be delivered. Her constituent Mr Forfar and his connection saga are, I am afraid, not unusual. I think

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we all have experiences of things like that. I sometimes wonder whether the ever-so-helpful BT engineers getting one job done means someone else unfortunately being dropped off the other end. As someone who worked for six years as a channel manager with BT—not for BT, but with BT—I understand only too well the nature of its people. It has some fantastic people, but some challenging systems and approaches.

The hon. Lady said, “This is Hampshire, not the Outer Hebrides”. My hon. Friend the Member for Na h-Eileanan an Iar (Mr MacNeil) would say “Amen to that!” I will have to pass on to him what she said, and I am sure he will have some choice words for her. I would turn what she said on its head: if broadband truly is a utility, it should not matter where someone is in these isles; they should be able to expect a proper level of service.

My hon. Friend the Member for Ayr, Carrick and Cumnock (Corri Wilson) wins the prize for the biggest tale of woe from a constituency office. I point out that it is not only BT that faces this challenge, because the circuit to my office in Galashiels, which was supplied by Virgin through parliamentary authorities, did not appear, so we got in touch and said, “Where’s our circuit?” Virgin said, “It has been installed.” “No it hasn’t.” “Yes it has.” “No, it hasn’t.” It was installed to the empty property next door. My hon. Friend deserves a prize, though, and I will work up a certificate later.

I commend the proactive approach of the hon. Member for Bexhill and Battle (Huw Merriman)—talking in Westminster Hall is very useful for learning the names of everyone’s constituencies; I hope I remember at least half of them—in seeking solutions. A lot of us have done that at local level. We know there are challenges and that the system that has been put in place can be moved forward. The Minister will make a justifiable case for the system being successful, but where it fails is now being flushed out, and that is where we must go next. I thank him and his team for their positive engagement as we seek solutions. I can say with some confidence that they at least understand the problem, which is the first step towards finding a solution. I look forward to supporting them further on that.

Members may have noticed that the hon. Member for Strangford (Jim Shannon) is thankfully better at articulating his case than he is at providing me with a glass of water. A member of my staff sent me a text message saying, “I hope that wasn’t coffee.” If they are watching, no, it was not. The hon. Gentleman made some fantastic points. The sector has a challenge with customer service, and part of my background is in contact centres and customer service. Bigger organisations have that challenge, but I have severe and real concerns that our looking for more structural separation may just lead to more finger-pointing between BT and BT Openreach about who is to blame for something not being done. A joined-up approach to customer service and the ability to hold BT to account are important. He also highlighted the lack of competition, which is a real issue in rural areas. I will come back to that point.

The hon. Member for Rochester and Strood (Kelly Tolhurst) used a word that we have probably all used today: “hopefully”. In my old job, if an area or regional leader said the word “hope” to me, I would say, “Hope is not a strategy”, but when it comes to BT, sometimes it feels like that is all we have. If we are reliant on hope,

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that is not enough. We should be able to rely on levels of service on which we can hold organisations to account, whether they are BT or others.

My hon. Friend the Member for Linlithgow and East Falkirk (Martyn Day) highlighted the challenge of simply getting broadband—he went very local, and I congratulate him on that. He brought up the universal service obligation. We are all interested in that, but we must ensure that it does not paralyse us, as the BT broadband roll-out has, with communities waiting and waiting because they think they might get BT broadband and so not pursuing other schemes. It is also critical that the USO covers not only download speeds but upload speeds, levels of service and cost. I encourage the Minister and Ofcom to consider such things as voucher schemes. It does not necessarily need to be a case of, “Here’s the satellite solution”, or whatever it may be. If there were a voucher scheme, communities might choose to use it in a different way to provide local solutions.

My hon. Friend the Member for Argyll and Bute (Brendan O'Hara) has a stunning constituency, and I look forward to talking with him later in the debate on whisky. That will be a more uplifting experience, I feel. Depopulation is a massive issue, and we must match the policy reality to the rhetoric about communications being a utility.

I suggest to the hon. Member for Cheltenham (Alex Chalk) that perhaps GCHQ has made a conscious decision that it does not want any connectivity around it. I suggest that GCHQ be moved to Argyll and Bute, where that can be done more successfully.

Jim Shannon: Within the Union.

Calum Kerr: The hon. Member for Strangford has to whisper “Union” repeatedly in my ear every time I speak. It is a skill he has.

BT’s position is key. I am a big supporter it, and it gets kicked about too much on its broadband roll-out scheme. It is a commercial entity that acts in a commercial way, but we also need to remember that it was a public carrier, and it has market dominance. The role of MPs, the Government and regulators is critical. We must and should hold BT to account, and we should hold it to high standards. Ofcom’s report states that it wants:

“A step change in quality of service”.

We must define that, measure it and hold BT to account as soon as possible, and I think BT would welcome that. Clarity and transparency of message are key. Two of Ofcom’s aims are:

“Empowering consumers to make informed choices”,

and to:

“Deregulate and simplify whilst protecting consumers”.

We must accept that the market does not function in rural areas. We need different solutions. We need Government interventions and more flexibility of mind about what the solutions look like. In a lot of scenarios that probably does not mean BT, because BT has established ways of working.

I thank the Minister for the way in which he has engaged with me and my colleagues on this topic so far. I urge him to act on the Ofcom report in relation to

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services and to work with us to ensure that the rhetoric of digital comms as a utility is backed up by substance and policy.

10.40 am

Chi Onwurah (Newcastle upon Tyne Central) (Lab): It is a pleasure to serve under your chairmanship, Mr Nuttall. I congratulate the hon. Member for Romsey and Southampton North (Caroline Nokes) on securing this important debate. I too must declare an interest: I worked as a chartered electrical engineer in telecommunications for 20 years before coming into Parliament, although I never worked for BT. I always wanted digital connectivity—broadband and mobile telecoms—to be higher up the parliamentary agenda. However, I am disappointed that it has moved higher up because of service failure rather than because of the social and economic potential that digital and telecommunications connectivity offers. The notoriety of certain cabinets—was it cabinet number 7?

Caroline Nokes indicated assent.

Chi Onwurah: Such notoriety is not to be welcomed, but I believe we will see more and more cabinets getting a national profile.

The economic benefits of communications infrastructure —or, as we have heard in some contributions, any kind of infrastructure that does not involve running up and down the street—are well known. We have heard detailed contributions about the limitations of that infrastructure from the hon. Members for Ayr, Carrick and Cumnock (Corri Wilson), for Strangford (Jim Shannon), for Rochester and Strood (Kelly Tolhurst), for Linlithgow and East Falkirk (Martyn Day), for Argyll and Bute (Brendan O'Hara), and for Berwickshire, Roxburgh and Selkirk (Calum Kerr), and we have heard some heart-rending stories about the impact on their constituents. We also heard from the hon. Members for Cheltenham (Alex Chalk) and for Bexhill and Battle (Huw Merriman).

As the hon. Member for Berwickshire, Roxburgh and Selkirk said, we should have connectivity from Hampshire to the Outer Hebrides and everywhere in between. The economic benefits of better communications have been accepted by the Government. Their own broadband impact study states:

“It is now widely accepted that the availability and adoption of affordable broadband plays an important role in increasing productivity.”

The UK has one of the worst productivity records in Europe.

As well as economic benefits, there are social benefits to connectivity, which we have heard about in detail in today’s debate, from online shopping, which is often cheaper, to access to more public and private services and remote healthcare. It is not right that some people cannot access those essential benefits of modern living because of the lack of a digital infrastructure. As has been said, the internet opens up a world of free education; indeed, it is a window on the globe. However, many people are missing out.

Many hon. Members focused on basic telephony; others emphasised mobile and broadband. The Minister recently admitted that his mobile infrastructure project was a failure, but he still claims that the broadband

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roll-out has been a success. Only last week, he was once again rubbishing Labour’s pledge to have fully funded 2 megabits per second universal broadband for all by 2012. We have heard today that far too many people—more than official figures admit—still do not have even that service. The Minister trumpets the universal service obligation of 10 megabits per second by 2020, but he should note that within eight years the broadband universal service that he proposes will have increased by only 1 megabit per year, and his commitment is entirely unfunded.

The importance of broadband for the rural economy has also been emphasised. A third of small and medium-sized enterprises do not have access to superfast broadband, so we have tabled amendments to the Enterprise Bill, which we will be debating in the House today, to improve the broadband available to SMEs, which, as is often said, are a driver of the economy.

Broadband is the fourth utility. That has been the consensus of today’s contributions. The Government have a responsibility to deliver it, and they have failed. I, too, do not wish to focus the blame entirely on BT—it is not BT’s responsibility, because it was the Government who did not ensure that there was competition so that we have the standards we need.

Ofcom’s recent consultation on the strategic review of communications found:

“The single biggest issue attracting comment”

was “quality of service”. It went on to say:

“Openreach’s performance is a particular source of concern.”

It concluded:

“These problems can only be addressed through more effective network competition or through regulation.”

It also stated:

“Over time we have found it necessary to apply more prescriptive regulation in order to address concerns about Openreach’s performance.”

That is a clear admission that competition cannot now be relied on to improve service standards, because the Government have failed to foster a competitive market-led rollout.

I do not know whether betting is in order, but may I ask the Minister to forecast how many times he will be called to the House in the next Session to try to explain his failure on broadband and digital infrastructure? We have a related debate on this subject tomorrow.

The Ofcom review focused on two things: service standards, as we have heard, and opening up duct and pole access to support competition. How will the Minister determine that we have finally achieved a competitive environment in broadband and digital connectivity? What will he do if that is not achieved? In the absence of competition, how will he ensure that the service standards set out by Ofcom are met? What will he do to ensure that the targets are not gamed by BT and others, and that there is appropriate action if they are not met? How long does he think it will take for BT’s service standards to meet the expectations set out in today’s debate? An important point made today was that expectations are rising. As broadband and digital connectivity become more and more essential, what measures will he take to ensure that such expectations are met in this country?

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All the measures set out in the Ofcom report are subject to further consultation and debate, and no doubt many lawyers will be present. Ofcom will need the right kind of political support to ensure that those measures are put in place. Our digital infrastructure is critical and strategic, and we have wasted five years in the policy wilderness not improving our digital infrastructure. The Minister will need to focus minds on that rather than on the exit from Europe that his Secretary of State is focused upon.

10.49 am

The Minister for Culture and the Digital Economy (Mr Edward Vaizey): It is a pleasure to serve under your chairmanship, Mr Nuttall. I congratulate my hon. Friend the Member for Romsey and Southampton North (Caroline Nokes) on securing this excellent debate. She has unleashed tales of woe from colleagues in England, Scotland and Northern Ireland, and no doubt there are similar tales of woe in Wales, so the question is: what are we going to do about this. Before I move on, I should thank the hon. Member for Berwickshire, Roxburgh and Selkirk (Calum Kerr) for his judicious response to the debate on behalf of the Scottish National party—he took a better approach than his party’s approach to Sunday trading, I must say. He has vast experience in the sector and made a very balanced case about the issues.

Of course, that contrasted with the traditional speech given by Labour’s shadow Minister, the hon. Member for Newcastle upon Tyne Central (Chi Onwurah), who is clearly launching Labour’s long march to power by promising 2 megabits to the country. Labour remains entirely silent on which policies will deliver the superfast speeds that people now want.

Chi Onwurah: Will the Minister give way?

Mr Vaizey: No. The hon. Lady has just had 10 minutes to set out her position and there was absolutely nothing in it. What is Labour’s position on the digital communications review? How would Labour get superfast broadband to the entire country?

Chi Onwurah: Fibre!

Mr Vaizey: How are they going to pay for the fibre that she is shouting about from a sedentary position? Of course, there is nothing. There has been only one failure in the superfast broadband roll-out programme that I have supervised and that was in south Yorkshire, where we inherited a useless Labour contract and had to write off £50 million of taxpayers’ money. Everything else has been an unadulterated success. We now have 93% of the country able to receive fibre, 90% of the country able to get superfast speeds of 24 megabits and above, and 50% of the country able to get ultrafast broadband speeds of 100 megabits and above.

I should say, though, that I have no truck with Openreach and its customer service levels. This morning I read an article in The Times by Danny Finkelstein, who is a remain campaigner. He is so depressed about the woeful leave campaign that he set out some measures that he thought the leave campaign should concentrate on. So, I shall give a speech on behalf of Her Majesty’s loyal Opposition.

Let me begin, as a member of the Opposition, by regretting the low levels of satisfaction with BT Openreach under the last Labour Government. There were low

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levels of satisfaction for pretty much everything under the last Labour Government, but they were woefully low for BT Openreach. They have improved under this Government, but they remain very much behind other providers. TalkTalk runs Openreach close in levels of customer satisfaction, but Virgin and Sky are way ahead. Perhaps BT should spend less money on sports rights and hire Sky’s customer services director instead.

As the Minister responsible for telecoms, I find myself a bit like a person who has been forced to adopt an unruly teenager. I go around telling my colleagues that he means well and is doing his best, but they simply tell me about the latest outrage they have suffered at his hands. That is the unfortunate position in which I find myself when it comes to Openreach customer service. I hold regional surgeries for MPs so that colleagues can tell me about the mess that Openreach has made of one or another connection, and I try to sort things out as best as possible. I also write to MPs every quarter to update them on the roll-out.

In defence of Openreach I should say briefly that, rather like the BBC compared with ITV, it suffers because it is the national provider and we all feel that we have a stake in it. There will inevitably be more complaints about BT. For example, I noticed that my hon. Friend the Member for Cheltenham (Alex Chalk) decried the fact that BT has not rolled out to the whole of Cheltenham in a way that he perhaps would not decry Virgin, because he does not expect Virgin to deliver a 100% roll-out in Cheltenham. Yet, when he thinks about it, BT and Virgin are in exactly the same position: they are both private telecoms providers rolling out a network.

Nevertheless, BT has a universal service obligation and is seen as the national provider. I acknowledge the fact that it has put in £10 billion of investment, that it has hired 3,000 engineers, that it is bringing its call centres back to the UK and that it continues to innovate with new technologies such as G.fast. Indeed, when I dealt with BT over Christmas and new year in relation to the floods in the north, it pulled its finger out and did a good job for many people who had suffered outages because of the flooding. There was a particularly important issue with emergency resilience. Still, there is absolutely no question but that BT must do better. I have spent five years in this job being inundated with tales of woe.

One other point in BT’s defence is that, because of functional separation and the fact that Openreach’s network is used by other providers, it can often be the case that the customer is contracting with, say, TalkTalk, or another provider, and the network is being provided by Openreach, and something falls between the two stools. Sometimes the provider with which the customer has contracted has simply put its order in wrong to Openreach, but it is very convenient for that provider to blame Openreach for its own failure.

As I say, Openreach must do better. As the Minister responsible, I find it particularly frustrating that I have to step in to sort out these problems. Why has Openreach not put in place a hit squad to deal with some of the more prominent complaints that come from MPs? We represent our constituents, and most of us are fairly judicious people; we do not raise complaints to Openreach unless we think they are serious. My hon. Friend the

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Member for Solihull (Julian Knight) mentioned a 99-year-old lady who suffered a stroke. On behalf of a Labour colleague, I dealt with a factory that had been built to be ready to open specifically on the basis of when Openreach was going to connect it, but Openreach was already a year behind schedule. That cost that factory many tens of thousands of pounds. It continues to baffle me why it cannot get its act together and sort out these prominent problems.

I had to intervene on new builds. When a housing development is being put together, one would have thought it was the most obvious thing in the world that the people buying the houses are likely to be relatively young and likely to have children, and therefore likely to want, in this day and age, fast broadband connections. However, it took me a year to 18 months to bang together the heads of BT and the house builders to get an agreement. Thankfully it was put in place at the beginning of the year and now new housing developments will have superfast broadband. One would have thought it was the most obvious thing in the world that there would be lots of customers on a new housing estate of, say, a thousand homes, selling for possibly £250,000 each.

I am really pleased with the Ofcom digital communications review. On the timing, I have said on the record that by the end of the year I want to see not necessarily a full and final agreement but clarity on where we are in relation to what Ofcom is calling for in its review. There are three parts to it. First is opening up BT’s network, which really needs to be done. BT has to look at what Ofcom is proposing and come to the table with credible answers. Secondly, BT has to make concessions to what Ofcom is saying about the governance of Openreach. Thirdly, there are consumer issues, one of which is automatic compensation. We might need to consider legislation, but my current understanding is that we will not need it. We need automatic compensation for consumers and small businesses that have suffered problems with service quality. That is another thing on which I want us to be close to agreement by the end of the year.

Ofcom will start publishing its quality of service reports in early 2017, and I want to ensure that that happens. We need much clearer information from providers. I, for one, would love them to get rid of this landline rental charge that they put on our bills. They put on their adverts a nice, big, juicy low price for broadband, and then an asterisk and a line saying, “By the way, you’ll have to pay £25 a month for landline rental.” All providers, whether it is Virgin, BT, Sky or whatever, should get rid of landline rental and just charge people for what they are buying: broadband, TV and a telephone service.

I hope that the Advertising Standards Authority will crack down on how providers advertise their speeds. At the moment, if only 10% of customers are receiving the advertised speed, in the eyes of the ASA that is supposed to be okay. I totally accept that the ASA does a good job—it is a great example of self-regulation—but it really needs to go further on that. In my humble opinion, at least 75% of people should be getting the speeds that the broadband providers are advertising.

As I think you have probably worked out, Mr Nuttall, I am completely at the end of my tether. I agree with all the complaints made by all my colleagues in this debate

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and am going to ensure that action is taken. I hope that if we debate this subject again in a year’s time we will have seen some action. Members may see a different Minister if I do not succeed, but we will do our best to make some progress.

Question put and agreed to.


That this House has considered BT service standards.

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Clinical Negligence Claims

11 am

Sir Edward Garnier (Harborough) (Con): I beg to move,

That this House has considered the Government’s proposals on fixed recoverable costs in clinical negligence claims.

Thank you, Mr Nuttall, for presiding over this very short debate. I thank Mr Speaker for granting it and my hon. Friend the Minister for being here to respond on behalf of the Government.

I should make it clear at the outset that, although I am a barrister in private practice, my work does not include clinical negligence cases, so I have no personal interest in this subject. I have, however, been approached by a number of solicitors from Leicestershire, the Leicestershire Law Society and the Law Society of England and Wales. They are concerned that the Government’s consultation on the fixed fee regime, which is being conducted by the Department of Health, has been delayed, although I understand that the Government intend to introduce a fixed recoverable cost regime in October. Those concerns are shared by a number of other solicitors’ firms, including Irwin Mitchell and Slater and Gordon, and organisations such as the Association of Personal Injury Lawyers, the Society of Clinical Injury Lawyers and the Bar Council. I am grateful to all of them for the assistance they have given me in preparing for this short debate.

Let me begin by placing my concerns in context. On the face of it, the Secretary of State’s statement, which has been trailed in the press—apparently, he is going to make a statement in the House of Commons this afternoon—confuses punishment, which is dealt with under criminal law, and civil law remedies, but no doubt he will make himself clearer this afternoon. Perhaps my hon. Friend the Minister can clarify that issue briefly this morning.

I accept that the Government do not have a bottomless purse. Taxpayers’ money is needed to pay for a huge range of public services, all of which compete for scarce resources at a time when the Chancellor is trying to balance the books and decrease public expenditure.

Nick Thomas-Symonds (Torfaen) (Lab): Will the right hon. and learned Gentleman give way?

Sir Edward Garnier: I will not give way.

That this debate takes place only a week before the Budget underlies that point. I further accept that the vast majority of patients who visit a GP, an NHS surgery or a hospital leave satisfied with their treatment and the outcome, but very occasionally something goes wrong. In just over 3% of those cases an error caused by a negligent decision or act of omission by a clinician leads to a claim being made by the injured person against the NHS. Such cases can include, for example, birth injuries or misdiagnosed or mistreated illnesses. Of course, those are not deliberate actions by ill-motivated doctors or nurses, but negligent ones that lead to adverse consequences for the patient.

What does 3% mean numerically? In 2011-12, the NHS reported just under 420,000 so-called “adverse incidents causing harm”, of which 13,500, or just over 3.2%, resulted in a clinical negligence claim. In the following year, there were just over 458,000 such incidents and 16,000

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claims, or about 3.5%. In 2013-14, there were just over 470,000 incidents and just under 18,500 claims, or 3.9%. In the great scheme of things, those numbers are small, but they represent permanently damaged or shortened lives, pain, suffering, heartache and anguish.

Of course, they also represent monetary expense to the claimant and the NHS. We should therefore aim to ensure justice and proper compensation for the claimant who has been injured, and protect the taxpayer from excessive and unnecessary expense in legal and medical experts’ fees.

Mr Pat McFadden (Wolverhampton South East) (Lab): Will the right hon. and learned Gentleman give way?

Sir Edward Garnier: I regret that I cannot; this is a half-hour debate, and I am afraid we are rather pushed for time.

It is uncontroversial to state—and the common law expects this—that damages should, as far as they can, put the injured party back where they were before the incident. We need a system that does not prevent the bringing of justified claims and encourages excellence and proportionality in the conduct of each claim, as well as in the conduct of the defence. An efficiently and expertly brought claim saves money, as it leads to the real issues being considered within a suitable timeframe. It allows the defendant to focus more quickly on what they need to do to satisfy the claim and not waste time and money on irrelevant or hopeless points.

Any changes that the Government intend to impose should not be retrospective—that is a basic rule of fairness —and must be even-handed. The Treasury must be an umpire and not a partisan ally of the Department of Health, because in the long run a poor set of reforms will lead to greater expense, not less, and a lessening of public trust in the NHS and the Department. Given that the Department of Health is managing the consultation and is the most common defendant in clinical negligence claims, it is difficult—despite, I hope, the construction of very high Chinese walls—to think of this as a wholly disinterested exercise.

It is easy to say—although it is not so easy to accomplish this—that the best way to reduce the number of clinical negligence claims against the NHS is to reduce the incidence of medical negligence. That is no doubt a statement of the blindingly obvious, but it may occasionally get forgotten as the Government look for ways to cut expenditure. Let us start by improving the training and decision making of those in the NHS who are statistically most likely to do things that lead to clinical negligence claims.

Let us also remember that the Legal Aid, Sentencing and Punishment of Offenders Act 2012 automatically cut the costs and expenses paid out by the NHS Litigation Authority by about a third, and that for claims worth less than £25,000 those savings come to 39% of the costs budget, or £71 million a year. In the NHSLA’s annual report of 2014-15, the chairman asserts that more than a third of the NHSLA’s spending was received by the legal profession, and most was paid to claimant lawyers. In fact, the report shows that the NHSLA’s operating costs amounted to £2.64 billion, of which £291.9 million, or 11%, was paid to claimant lawyers and £103.2 million, or 4%, to defence lawyers.

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The report’s figures suggest that 15% of the LA’s spending is paid to lawyers, but there is no breakdown of what that number includes. The report indicates the LA’s net operating costs reduced from £3.373 billion to £2.641 billion between 2013-14 and 2014-15—a reduction of £732 million. It also says that claims reported to the LA reduced from 11,945 in 2013-14 to 11,497 in 2014-15—a reduction of 3.7%. The amounts paid out in damages reduced from £840.7 million in 2013-14 to £774.4 million in 2014-15—a reduction of 7.9%.The NHS has therefore achieved significant reductions in expenditure. The NHSLA also reports an increase in sums paid to claimant lawyers for costs and disbursements from £259 million to £292 million between 2013-14 and 2014-15. The average cost per case increased from £16,852 to £17,735—an increase of 5.2%.

There is inadequate analysis of those figures, and the report is, to that extent, misleading. The NHSLA claims to have

“saved over £1.2 billion…in rejecting claims which had no merit.”

However, as claims without merit always fail, those savings are illusory. It cannot claim to have saved money it would never have spent. The authority also claims that £38.6 million was saved by taking a significant number of cases to trial, but it does not say how much was spent unsuccessfully contesting cases at trial or settling cases soon before trial.

The NHSLA refers to the levels of costs recovered by claimant lawyers without distinguishing between costs and expenses. It compares the level of costs incurred by different sides without noting that the burden of proof requires claimants to undertake much more work than defendants. APIL says that nearly half of what the NHSLA says it pays out in legal costs to claimants’ lawyers are accounted for by success fees on conditional fee agreements, after the event insurance premiums, court fees and expert witnesses’ fees. Much of that could be saved if the NHSLA were better at its job of settling the claims it ought to realise it will lose on liability from or close to the outset.

That said, not all medical negligence claims are straightforward, but proving what went wrong is not made easier for a claimant’s lawyer when the NHS holds all the information and is reluctant to disclose it. On far too many occasions, cases that could have been settled more quickly, cheaply and satisfactorily are not, because the NHSLA withholds information, does not respond in good time to requests for information, or simply fails to apply its collective mind to the best way of dealing with the complaint. I have lost count of the number of times that I, as a constituency Member of Parliament, have corresponded with a hospital, insurance company or some large institution, private or public, that, when faced with a complaint, has buried its head in the sand and hoped that it will go away.

Most complainants just want someone to take responsibility and say sorry, and are not after money or revenge. That applies to the bereaved parents of stillborn babies as much as it does to the adult children of an elderly patient who died after a fall from a hospital bed, or who lay for days in agony because of untreated bed sores. The defensive failure to apologise often causes more heartache than the negligence itself and causes claimants to believe that they have to sue to get justice.

In addition, the NHSLA too often engages in unproductive trench warfare: it must not be seen to be giving ground, so the order goes out: “Deny, defend, delay!”

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Cases that could have been resolved months and sometimes years earlier end up being settled at the door of the court, or lost after a trial, by which time advocates’ brief fees have to be added to all the other costs that have piled up unnecessarily since the complaint was first raised. If ever there was a need for a patient to heal himself, it is the NHSLA in its refusal to free itself from the indefensible, or to see the wood for the trees. Rather than too often denying, defending and delaying in the wrong cases, it should assess, admit and apologise in the right cases.

An example of that is in the failure to look for and to release medical records. Requests for records should be met under the Data Protection Act 1998 within 40 days and under Government guidelines for healthcare organisations within 21 days. Far too often both deadlines are missed and not by a whisker, but by a country mile. It can often take more than six months for claimant lawyers to get patients’ records from GPs and hospitals and, with a limitation period of three years to bring a claim, pressure mounts to issue proceedings to protect the claim. It is not unheard of for long-delayed medical records to show that the claim is unwinnable, so it is dropped—but why not send out the records within a month and save the time, the expense and the anguish?

The NHS is a hydra-headed organisation and, when dealing with medical negligence claims, that can lead not to the proper use of decision-making powers at the most local level, but to procrastination, duplication and more expense. Some NHS trusts have in-house legal departments and when they receive a claim pass it directly to the NHSLA; some hold on to them and pass them on much later. My informants from the legal profession tell me that trusts’ legal teams are far less settlement-minded and tend to use every point, good, bad and indifferent, to string the claimant along. If a case gets towards trial, the NHSLA instructs outside lawyers. Why not make it a matter of policy for all claims to be handed straight over to the NHSLA, and thus minimise, even if not abolish, delay and unnecessary costs?

Finally, I want to urge the Government to reconsider their proposal that all clinical negligence cases up to a value of £250,000 should be low-value claims. First, in any view, £0.25 million is not a low-value claim either to the claimant or to the taxpayer, not least when one considers how many there are every year.

Secondly, to take just one example, hundreds of babies are left brain-damaged every year because the NHS has treated them negligently either before or after birth and, sadly, some of them die soon after birth. A claim brought by the parents of a child who has died aged a few hours, days or weeks, will not of itself lead to a large award of damages, but the evidential route to determining where liability lies for the acts or omissions that led to that premature death can be highly complex in investigation and assessment. The same legal costs may be incurred in proving a claim, whether it is of low or of high value.

For instance, in a case of delayed cancer diagnosis, the same expert evidence may be required where a patient’s life expectancy has been reduced by two years and the award is £30,000, or where life expectancy is reduced by 50 years and the case is worth £500,000. Those worst affected will be the most vulnerable—the elderly, those on low income and people with disabilities.

On 13 January, in answer to my written questions Nos 21040 and 21037, the Minister accepted, unsurprisingly, that there is no exact correlation between the value and

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complexity of clinical negligence claims, and it must therefore follow that to impose an artificial limit on the amount of costs recoverable by the claimant based only on the quantum of damages could lead to injustice, especially when the NHSLA will not be equally constrained.

Already claimant law firms reject 90% of inquiries in this field and the proposed fixed-fee regime for cases of up to £250,000 will simply dissuade firms from assisting even more claimants. As one experienced Queen’s bench master who specialises in such cases recently said, further research is

“essential in order properly to understand the impact on access to justice of the existing system of funding before implementing any further changes.”

A fixed-costs system for claims under £250,000 would affect 95% of cases and make many meritorious claims unviable for patients, undermining the legal and the medical systems. That would not be in the interests of justice, of medicine, of the economy or of the country, and we need to think again. The Minister is a thoughtful man, and I am sure he will want to give a thoughtful response, today and subsequently.

11.16 am

The Parliamentary Under-Secretary of State for Health (Ben Gummer): This is a fascinating matter, which deserves a great deal of debate. We could discuss this interesting subject for many hours. I am grateful to my right hon. and learned Friend the Member for Harborough (Sir Edward Garnier) for condensing a complicated issue into a 15-minute, eloquent explanation of the problems that face us.

In addition to the reading that my right hon. and learned Friend has already done, I point him in the direction of the MBRRACE-UK—Mothers and Babies: Reducing Risk through Audits and Confidential Enquiries across the UK—report into the quality of investigations into stillbirths and neonatal injuries and deaths in the NHS, which was published at the end of last year. Although it charts a significant improvement in the reduction of stillbirths and neonatal deaths over the past 20 years due to the advancement of science, it draws one very depressing conclusion, which is that the quality of investigations has not improved since the 1990s.

I admit immediately that there is not yet any clear, scientifically proved correlation between that and the fact that litigation costs have increased, but I hope that my right hon. and learned Friend will accept my initial submission, which is that there is not the evidence for one of his claims, that somehow the increase in litigation automatically leads to an improvement in investigation and, therefore, to an improvement in patient safety. I therefore suggest that one of the statements that he made in his very careful speech is not a full reflection of the truth that we are seeking to uncover.

My right hon. and learned Friend said that we should aim to achieve proper justice and proper compensation for the claimant, and that that is the endpoint of litigation —but it is only a partial endpoint. The first thing that we are trying to achieve is an understanding of what went wrong to ensure that that is immediately transmitted back into the service, so that we prevent such a clinical catastrophe from happening to another individual or family. That is exactly where the existing system does not work, because it militates against learning early in the litigation process. In many instances, it provides a

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definitive account only at the point of judgment. That is what we are seeking to change through our proposed reform.

Nick Thomas-Symonds: I am grateful to the Minister for giving way, and I congratulate the right hon. and learned Member for Harborough (Sir Edward Garnier) on securing the debate. I also declare that I am a non-practising door tenant at Civitas Law in Cardiff.

I accept the Minister’s point about the quality of investigation. Will he also agree that access to justice is itself crucial, particularly given that the Lord Chief Justice, Lord Thomas of Cwmgiedd, recently said that access to justice is now “unaffordable to most” and available only to the very richest?

Ben Gummer: I will turn to access to justice. I do not entirely accept the hon. Gentleman’s interpretation of the judge’s words.

In our proposed reforms, I intend to change the balance for the NHS Litigation Authority and for claimant lawyers to ensure that we get to a single version of the truth as early in the process as possible. I accept in its entirety my right hon. and learned Friend’s interpretation of the NHSLA’s performance in past years. I do so on the basis that many claimants have been immensely frustrated—as have the clinicians involved—by the length of time that trusts and the LA have had to respond to claims, the length of time it often takes to reach a resolution and the fact that there is often too much defence, delay and prevarication. At the same time, I have full confidence in the NHSLA’s current management, because I have seen a real determination to get to grips with the problems it inherited and change the authority into something far more fit for purpose.

I accept my right hon. and learned Friend’s contention that we need to change what happens with the NHSLA, but I posit that the existing costs regime encourages some claimant lawyers to stack costs in the early stage of a claim process rather than get to what we need to do: to establish a version of the truth agreed between all parties. I am not arguing that that is a deliberate and malicious intention, but that is how the system is constructed at the moment. Therefore, in attempting to reform how costs are settled between the NHSLA and claimants, we want to incentivise learning right at the beginning of the process, to ensure that it is as rapid as possible and that, if claimants have a fair claim, they receive justice and compensation as quickly as possible. Our interests are therefore entirely aligned.

That is why I say to claimant lawyers—I have said this privately to them on several occasions—that this is a genuine consultation. We are seeking to find out how best to reform a system that we all accept is not right. I therefore warn them against peremptory lobbying of Members of Parliament about a scheme that has not yet been determined. This is a genuine consultation, in which we will accept all their views, but they cannot—I hope they will not—proceed on a basis that could lay them open to accusations of pleading for special interests rather than trying to contribute to the consultation.

Mr McFadden: The right hon. and learned Member for Harborough (Sir Edward Garnier) said that law firms currently reject 90% of cases brought to them

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because the burden of proof is high. I therefore do not think that we should portray this as a field of many frivolous claims. With that degree of rejection by law firms as background, will the Minister tell the House how the Government came to their figure for estimated savings for the new regime of £80 million? Where will those savings come from?

Ben Gummer: I hope that I in no way suggested that any of the claims brought forward were frivolous. I am saying that the way in which the current system is constructed loads costs at the beginning, and that does not help get us to a fair and equitable solution as quickly as possible. I am merely positing, but I believe there is fault on both sides. It is not necessarily the fault of either organisation; it is the fault of the system as a whole, which does not encourage good behaviours. The result is that we are not extracting learning as quickly as possible from litigation; we are not using claims, when unfortunately they are brought, to ensure that we improve medical practice; and, frankly, we are not using the early stage of complaints sufficiently well to ensure that claims are not brought.

I entirely agree with my right hon. and learned Friend that almost all complainants are not after a financial reward; they just want someone to say sorry and to accept responsibility for what happened. If we can achieve that far quicker in a learning culture, we will do something remarkable, not just for them, but for the many people who will follow. In answer to the right hon. Member for Wolverhampton South East (Mr McFadden), the estimate of savings proposed in the initial consultation document was part of the spending review round, and it was done through the usual modelling processes employed by the Treasury and the NHSLA, which understands the value of claims coming through.

My right hon. and learned Friend asked about the £250,000 limit. That limit was not arbitrary, but drawn from the original intentions of Lord Justice Jackson’s review on civil litigation costs in 2010, with which I know he is well acquainted. In that review, Lord Justice Jackson pressed for fixed recoverable costs in the lower reaches of the multi-track up to £250,000. That was in relation to personal injury claims, but, in trying to draw a line somewhere, we felt that that was an appropriate place, given his recommendation to do so. That is, however, subject to consultation. We want to hear the full range of views about where the limit should be placed. My right hon. and learned Friend’s contribution will be an important part of that consultation, and I and officials will take note of it.

My right hon. and learned Friend spoke of the Chinese walls and why the Department of Health is bringing forward this review. He is well aware of the usual practice that Departments bring forward proposals that relate to their areas of responsibility. The Ministry of Justice did so in previous reforms in which it had a financial interest, just as the Department of Health is doing here. I hope that, in our open approach, we will be able to explain that our primary concern is around changing the culture of the NHS and making sure that we are driving down claims for good reasons—that there are fewer of them because we are improving clinical practice—rather than just trying to deny people access to justice, which is the opposite of one of the intentions of the review.

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The hon. Member for Torfaen (Nick Thomas-Symonds) is entirely right to say that we should ensure that we make justice as open as possible. The litmus test of the reform will be that, if people feel that, despite everything we are doing to make the NHS a better organisation—listening to complaints, learning from mistakes and providing restitution early—they still wish to bring forward a claim, it will be easy to do and no unreasonable barriers will be placed in their way.

Christina Rees (Neath) (Lab): If a person has a claim as a result of a serious injury, but they cannot get legal representation, that person is still severely injured and the costs will still fall back on the state.

Ben Gummer: I am well aware of that, and that is why we need to ensure that, at the end, the reform produces good effects rather than deleterious ones. I am aware of the concerns of the hon. Lady and many hon. Members, but I ask her to be open to what the Government are trying to do and to feed in her suggestions for how we can make the system better, because clearly at the moment, as I have tried to explain, it is not working in the interests of patients in the NHS. That is why we so badly need reform of the clinical negligence system.

Finally, my right hon. and learned Friend spoke about the speech that the Secretary of State is due to give—he will brief the House in due course—and wondered whether punishment was being confused with civil law remedies. We must all understand—many in the clinical negligence community have not quite grasped this—that a revolution is going on in medicine at the moment, learning from other sectors such as air accident investigation, that appreciates that one can have learning and lessons learnt in an organisation only if one provides safety for clinicians, for example, to speak openly when something has gone wrong. Sometimes we need to provide context around such discussions to make them feel safe. That has been achieved for air accident investigations and we want to do something similar for the NHS, so the Secretary of State will make more of that plain to the House in due course.

None of that is to change the basic freedom of people to find remedies in law. As we develop this exciting area of medicine in the next few years, I hope that the interplay between those two will mean reductions in deaths, accidents and patient safety problems in the NHS by tens of thousands and then hundreds of thousands in the years to come. That will possibly be one of the biggest factors in reducing mortality in the NHS since its foundation more than half a century ago.

Question put and agreed to.

11.30 am

Sitting suspended.

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Scotch Whisky Industry

[Mrs Madeleine Moon in the Chair]

2.30 pm

Brendan O'Hara (Argyll and Bute) (SNP): I beg to move,

That this House has considered the contribution of the Scotch whisky industry to the UK economy.

It is a pleasure to serve under your chairmanship this afternoon, Mrs Moon. I am delighted to have secured this debate and to see so many of my colleagues present, particularly as they were all made aware that this is most definitely not a tasting event. I sincerely thank them for their attendance.

I understand that several hon. Members want to take part in this debate. If I have learned one thing since coming to this place last May, it is that no one loses points for repetition. However, in order to let colleagues develop their own arguments, I shall endeavour to speak in fairly broad terms about the remarkable economic success that is the Scotch whisky industry. I shall highlight the industry’s success before touching on what measures I believe that the Government must take to build on the achievements that we are currently enjoying and to ensure investor confidence for many years to come. I shall also look at the importance of the industry for rural communities throughout Scotland.

Thereafter, I shall shamelessly indulge myself in promoting the beauty of my Argyll and Bute constituency, which, regardless of what some of my green-eyed colleagues may claim later this afternoon, is without doubt the world’s whisky centre of excellence. As the home to the world-renowned whisky coast, Argyll and Bute can boast no fewer than 14 distilleries, which are working round the clock to produce the finest whisky in the world, consumed in ever greater numbers both at home and abroad. That said, I am inclined to agree with Raymond Chandler, the great American novelist, when he said:

“There is no bad whiskey. There are only some whiskeys that aren’t as good as others.”

I have a theory that all Scots children are born knowing certain incontrovertible truths—the kind of thing that you just know and do not have to learn, such as the fact that everything good in the modern world was invented by a Scot, that that ball never actually crossed the line in the 1966 World cup final and that Scotch whisky is, as George Bernard Shaw so wonderfully described it, “liquid sunshine”.

That liquid sunshine provides a silver lining for the UK Exchequer, as sales of Scotch whisky both at home and abroad contributed more than £5 billion to the UK economy last year. Last year alone, almost 100 million cases of Scotch whisky were exported to every part of the world. That is 40 bottles every second of every day leaving Scotland, bound for Spain, Brazil, America, Canada, China and just about everywhere else in between. Those exports earned this Exchequer £4 billion—or, to put it another way, £135 every second of every day for the UK balance of payments. Indeed, Scotch whisky is liquid sunshine for the Chancellor.

To be fair to the Chancellor—please take note, as this is probably a once-in-a-career event—he had the foresight last year to cut spirit duty by 2%. Indeed, it was only the fourth time in 100 years that that had been done.

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Although that cut was very welcome, many of us feel there is much more we can do, as taxation still accounts for 76% of the price of a bottle of whisky.

It is worth remembering that last year’s cut in spirit duty was, by the Treasury’s own Red Book calculation, believed to result in a shortfall of £185 million to the Treasury. The reality, however, was very different: the 2% cut in 2015 actually increased the tax take to the Treasury by more than £100 million. I am not saying that every 2% cut in spirit duty will recoup £100 million for the Treasury, but I think we can argue with a great deal of justification that a cut in spirit duty helped to increase sales in the domestic market for the first time in several years. It also sent out a very important signal to potential investors in the Scotch whisky industry.

Investor confidence is vital. The initial duty freeze, followed by a duty cut, gave confidence to investors, who saw that, for the first time in decades, there was a Government who did not view the Scotch whisky industry simply as a cash cow. As we know, spirit can only become whisky after it has been laid down for three years; only then can it be classified as Scotch whisky. For at least three years, investors can therefore have little or no return on their money. The fact that nine new distilleries have opened across Scotland in the past two years, with no fewer than 40 in various stages of planning and construction and hoping to come on stream over the next two decades, is in no small part due to the change in policy of not hiking spirit duty at every possible opportunity.

In fact, such is the confidence in the industry that there are advance plans to open a new distillery in the Scottish borders. To put that into context, the last distillery in the Scottish borders closed its doors in 1837—the year Queen Victoria ascended to the throne, and shortly after the birth of the great Mark Twain, whose love of whisky was such that he was moved to say:

“Too much of anything is bad, but too much good whiskey is barely enough.”

I have heard several people question how we can call for a further cut in spirit duty while at the same time campaigning in Scotland for a minimum unit price on alcohol. Let me say immediately that those are not contradictory positions. The adoption of a minimum unit price was never intended to affect sensible, moderate drinkers, and it would have no impact whatever on the production, consumption or export of Scotch whisky. Minimum unit pricing is designed to impact on the most harmful drinkers and is targeted at own-brand spirits and ciders that are high in alcohol but usually very cheap at the point of sale.

In the past few years, we have seen a signal to investors that Scotch whisky is a solid and sound investment. It is an investment that creates jobs and prosperity. The industry already supports directly and indirectly more than 40,000 jobs, many of which are highly skilled, across the United Kingdom. Included in that figure are 7,500 jobs in rural communities, where it is often very difficult to find alternative employment. A classic example of that is the new Isle of Harris distillery, which opened last year with the aim of producing 300,000 bottles of single malt a year. That one distillery has created 25 new jobs in the town of Tarbert, which has a population of barely 1,000 souls. That is an oft-repeated story across

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the highlands and islands of Scotland, where whisky distillation and high-skilled local employment have gone hand in hand for centuries.

As I said at the outset, in my opinion—and as chair of the all-party group on Scotch whisky, I suggest that that opinion is not to be taken lightly—the finest whiskies in the world come from Argyll and Bute, although I fear that my right hon. Friend the Member for Moray (Angus Robertson) and my hon. Friends the Members for Ross, Skye and Lochaber (Ian Blackford) and for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry) may be of a different opinion. On our whisky coast in Argyll, we have 14 distilleries producing some of the most famous brands in the world. We have Bowmore, Ardbeg, Bruichladdich, Bunnahabhain, Caol Ila, Lagavulin, Laphroaig, Kilchoman, Isle of Jura, Glengyle, Springbank, Glen Scotia, Tobermory and Oban—and if you can still reel those names off after a good night, perhaps the night was not as good as you thought it was. As well as producing great whisky and creating employment, those distilleries attract tourists to the area in their tens of thousands. Indeed, visits to distilleries have rocketed in recent years; I saw a figure suggesting that one in every five visitors to Scotland visits a distillery.

Stuart Blair Donaldson (West Aberdeenshire and Kincardine) (SNP): I thank my hon. Friend very much for securing this debate. Will he join me in welcoming the fact that Royal Lochnagar distillery in my constituency —the home of the first distillery tour, for Prince Albert and Queen Victoria—has almost doubled its visitor numbers since 2008, with 16,384 visitors visiting in 2015?

Brendan O'Hara: I absolutely join my hon. Friend in welcoming that, and that statistic is replicated across the country. Islay, for example, which has a population of just 3,000, has eight working distilleries with two more currently under construction. In 2014, Islay had 125,000 visitors to its distilleries—that is 41 visitors for every permanent resident on the island. The importance of tourism, and whisky tourism, cannot be overstated, and if hon. Members have not holidayed in Argyll and Bute, I suggest that they put it on their bucket list immediately.

I used to think the sky was the limit for our Scotch whisky industry, but it appears that I was wrong. It seems that there are absolutely no limits on what our industry can achieve, as I recently discovered, when I was told that a quantity of Ardbeg was sent into outer space to the international space station—for research purposes, I believe. Who would have believed that Argyll and Bute would be exporting liquid sunshine into outer space? Indeed, if that is not an argument for awarding the UK space station to Machrihanish, I do not know what is.

Wayne David (Caerphilly) (Lab): My intervention is not specifically on that point. Sadly, I say as a Welshman that there is no whisky industry in my constituency, but there is one not very far away, and it produces wonderful Welsh whisky—one day perhaps there will be competition. My point, however, is that not only is Scotch whisky tremendously important to Members’ constituencies and Scotland as a whole, but to the United Kingdom. Given that the Scotch whisky industry is worth some £3.3 billion directly and £1.7 billion indirectly to the UK economy, does the hon. Gentleman agree that it is important not only locally in Scotland, but to Wales and the United Kingdom?

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Brendan O'Hara: I could not agree more with the hon. Gentleman—my honourable Welsh friend—about the importance of the Scotch whisky industry. For all these islands, it is absolutely vital and I am delighted that the Government have shown a commitment to creating a more level playing field than there has been in the past.

The Scotch whisky industry is not just one of Scotland’s oldest, most iconic and most culturally significant industries, but one of our largest and most successful. As I said, it contributes massively to the UK balance of payments, supports 40,000-plus jobs and pays out £1.5 billion in salaries. Exports are up, domestic sales are up and investor confidence is at an all-time high. There is a golden future for Scotch whisky, and I urge the Government to keep faith with that industry and allow it to build on recent successes by applying a further cut to spirit duty in next week’s Budget. Together, we can boost the industry and the wider economy for the benefit of us all.

Mrs Madeleine Moon (in the Chair): Before I call Andrew Percy, I will just say that there is a lot of interest in this debate; I have eight people down to speak and I can see a lot of people who will want to make interventions. I suggest that speakers take five minutes maximum each, if all are to get in, which will include the time that hon. Members give for interventions.

2.45 pm

Andrew Percy (Brigg and Goole) (Con): It is a pleasure to serve under your chairmanship, Mrs Moon. I congratulate the hon. Member for Argyll and Bute (Brendan O'Hara) on securing this important debate in support of the whisky industry, which is important not only to Scotland but to the whole of the United Kingdom.

I declare an interest as an avid Scotch drinker. In fact, I drink all sorts of whisky, whether it is Arkansas rye whiskey or my particular tipple of Highland Park. Or there is even the whisky produced by the English Whisky Co., which is very good, or Penderyn, which is very lemony, very citrusy, very nice. I have named enough now in the hope that somebody sends me a free crate; we will see. I will not talk about my evening on Kintyre with a full bottle of Laphroaig—we will leave that one, but the photos are still out there.

This is an important debate for all the reasons that the hon. Gentleman gave. Scotch whisky is a huge part of the UK economy. I want to talk in particular about its impact on the whole of the United Kingdom and my constituency, the duty rate, and the potential for growth in the market through trade agreements such as the Canada-EU comprehensive economic and trade agreement.

I have just accepted a small role as the Prime Minister’s trade envoy to Canada, and one of my mandates from him is to market and push CETA and its benefits. I am not the first politician to hold two diametrically opposing views at the same time, but while promoting CETA, I am, of course, also campaigning for us to leave the European Union. Leaving that small inconsistency aside, CETA will obviously be of great importance to the Scotch whisky industry. I would argue, of course, that outside the European Union we would still have the same access, blah blah blah, but Canada is the 15th biggest market for Scotch whisky, with about £66 million-worth of exports—about 20% of all Scottish exports to Canada. Unfortunately, however, due to the liquor board system

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in Canada and some of the burdens placed on imports, Scotch whisky is unfairly discriminated against at the moment. We have to make sure, through the final stages of CETA, that those barriers are removed so that we have full access for Scotch whisky to the Canadian market.

That is a reminder of just how important trade treaties can be to jobs. There is a lot of opposition to the Transatlantic Trade and Investment Partnership, and some of that is unfortunately filtering through to CETA, but we have to make it very clear not only to people in this place but to the wider public that it is a good deal that will support jobs across the United Kingdom.

Scotch is doubtless a Scottish product, and Scottish people should be very proud of it, but it is also a great British product. IG Industries in my constituency provides a lot of the packaging, and Muntons, also in east Yorkshire, provides some of the cereal. I like to think that when people have their tipple of Scotch whisky, the taste comes not just from the fine Scottish water but from the even better east Yorkshire grain.

Margaret Ferrier (Rutherglen and Hamilton West) (SNP): The Scotch whisky industry creates prosperity and jobs right along the supply chain, be it in cereal, ceramics, glass or haulage. Does the hon. Gentleman agree that we should do all that we can to support the industry and to protect the many jobs that depend upon it, and that we should listen to its calls for a small drop in duty?

Andrew Percy: I do have sympathy with that. It was nice to hear the hon. Member for Argyll and Bute pay tribute to the Chancellor, which is not something I often do either. He was correct to do so on this issue, because the calls that were made last year were successful. We have all seen the incredibly positive impact that has had on the supply chain and jobs, and if there could be movement again, that would be appreciated. I need not reiterate the number of jobs that the hon. Gentleman quoted, but they are a huge part of this country’s economy and employment profile. As we heard, our trade deficit would be 11% higher without Scotch whisky. It is a great product, and a British product in so many ways, including the fine Yorkshire grain and the packaging from my constituency. It supports jobs at the Immingham port complex through exports, so it is important to the whole UK market.

I am conscious of your instruction on time, Mrs Moon, so I will end with a simple request to the Minister, which he will hear many times today. If there is an opportunity ahead of next week’s Budget for some movement on the 67% duty rate, I will entirely support it, not least because of the arguments we have heard so far today.

2.50 pm

Ian Blackford (Ross, Skye and Lochaber) (SNP): It is a pleasure to serve under your chairmanship, Mrs Moon. I thank my hon. Friend the Member for Argyll and Bute (Brendan O’Hara) for initiating this important debate today.

Whisky is Scotland’s gift to the world, a gift that brings enormous benefit to the Exchequer. It has a substantial impact on our trade statistics and generates substantial employment in Scotland. The success of the

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whisky industry is rooted in rural Scotland, where the addition of well-paid employment puts substantial income into many local economies.

There has been a renaissance in Scotch whisky with so many iconic brands being marketed and sold throughout the world. Its brand identity is unparalleled and has been hard won, although it needs to be protected and invested in. There is a competitive threat from other products, but none have the right to call their product Scotch whisky. The rich diversity of successful Scotch whisky global brands has helped to create the circumstances for an explosion of investment in new distilleries, often small community-based operations that add to the rich tapestry of unique product offerings and the breadth of those offerings to the discerning palate. Each whisky is unique and is shaped by the environment and character of each distillery with the barley, the local source of water and the peculiarities of the still among other things affecting the character of each whisky.

We have several distilleries in my constituency, including some in the planning and development phase. In Skye, we have the iconic Talisker whisky, which was the favourite of writer Robert Louis Stevenson. In his poem, “The Scotsman’s Return from Abroad”, he said:

“The king o’ drinks, as I conceive it, Talisker, Islay, or Glenlivet.”

Roger Mullin (Kirkcaldy and Cowdenbeath) (SNP): Will my hon. Friend give way?

Ian Blackford: Because of lack of time I want to press on, but before my hon. Friend the Member for Argyll and Bute gets excited about Islay being mentioned in the same sentence as Talisker, I should point out to him that the king of whisky, Talisker, is the first and foremost whisky to be mentioned in the poem.

Moreover, in the film “Charlie Wilson’s War”, CIA agent Gust Avrakotos presents Congressman Wilson with a bottle of Talisker. The agent explains to Charlie that Scotch is mentioned in a Robert Louis Stevenson poem, but the bottle is bugged and allows him to listen to the congressman’s conversations. One would hope that in this House Talisker may be enjoyed by all and certainly never used for more subversive activity, although with this Government you never know.

One website on whisky stated the following of Talisker:

“This alluring, sweet, full-bodied single malt is so easy to enjoy, and like Skye itself, so hard to leave.”

What must be kept in mind is that Talisker distillery and so many of our distilleries are located not just in the most beautiful parts of our country but in areas of varying degrees of fragility of economic activity. Talisker is located on the western side of Skye where the potential for full-time, year-round employment is limited. The distillery employs 45 staff members, a significant number for an island with a population of just over 10,000. It is of note that only nine of those jobs are in production, with the vast bulk of employment being around the visitor centre. Last year, it welcomed a grand total of 67,000 visitors. The distillery is the second highest visitor attraction in footfall on the island of Skye.

Clearly many people come to Skye to visit Talisker, among other places, helping to grow and develop our tourist offering and tourist spend, not just at Talisker

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but throughout the island. The motion today refers to the economic value of whisky to our country. That economic benefit is based on the direct value of the whisky industry to many rural communities in my constituency and elsewhere. Talisker is a well-established successful brand, but the story does not end there.

Torabhaig distillery is under construction on the Sleat peninsula on Skye. This distillery is expected to employ a staff of eight when it enters production. There are also plans for a new distillery on the island of Raasay. There is a birth of a new spirit in the Hebrides, a spirit that will excite the whisky world with these new ventures adding to the appeal of Skye and Raasay as the premium whisky region of the entire industry.

I have many distilleries in my constituency. The Glen Ord distillery in Muir of Ord is a contrast with Talisker. It employs just shy of 60 workers and as well as production of the Singleton of Glen Ord brand and a successful visitor centre, there is also a maltings at Glen Ord as well as an engineering base for the parent company, Diageo.

I am glad to say that not far from Glen Ord, just outside Dingwall, is another new distillery, GlenWyvis, based on a long-held tradition of distilling in this area under the name of the previous Ferintosh distillery. Our national bard, Rabbie Burns, famously lamented the previous loss of this distillery when he said in 1759:

Thee, Ferintosh! O sadly lost!”

Well, it is lost no more.

Because of lack of time, I will wrap up. We celebrate the success of the whisky industry, but let me quote Douglas Fraser of the BBC who stated in 2013:

“Scotch whisky is a national brand worth toasting. It is a drink that can only be distilled and matured in one country—Scotland—but which sells in to 200 markets around the world. How did Scotch go from cottage industry to global phenomenon and how does it benefit its country of origin?”

That question requires more time for debate than we have today, but let me reflect briefly on employment.

As has been mentioned, 40,000 jobs are connected with the industry, 7,000 of which are in rural Scotland. My challenge to the industry is that, as well as the very welcome investment in distilleries, more can be done to make sure a greater part of the supply chain is secured in the area of production. Let us increase the dividend available for those in whisky-producing areas and let us toast the success of the industry, but let us have the ambition to grow this fantastic industry on a sustainable basis. To encourage this to happen, the Chancellor must play his part next week by reducing duty and introducing greater equity for the Scotch whisky industry.

2.56 pm

Patricia Gibson (North Ayrshire and Arran) (SNP): Everyone here today understands that Scotch whisky is a huge player in the UK economy and overseas markets, and without the success of this industry Britain’s trade deficit of around £35 billion would be around 11% larger. This wonderfully popular product is the biggest net contributor to UK trade in goods. Exports are worth almost £4 billion and imports in the supply chain, such as packaging for products and casks for maturing the spirit, add value to our economy. The industry’s trade balance is £3.8 billion, supporting almost 40,000 jobs, 10,800 of which are worth £1.4 billion to UK workers.