8 Jan 2013 : Column 1

House of Lords

Tuesday, 8 January 2013.

2.30 pm

Prayers—read by the Lord Bishop of Derby.

Death of a Member: Lord Rees-Mogg


2.36 pm

The Lord Speaker (Baroness D’Souza): My Lords, I regret to inform the House of the death of the noble Lord, Lord Rees-Mogg, on 29 December. On behalf of the House, I extend our condolences to the noble Lord’s family and friends.

Leader of the House

2.37 pm

Baroness Royall of Blaisdon: My Lords, in leading the tributes to the noble Lord, Lord Strathclyde, I am able to be the first to welcome formally as his successor the noble Lord, Lord Hill of Oareford. The noble Lord, Lord Hill, is already very well regarded and liked by this House, and I both welcome his very imaginative appointment and look forward to working with him closely in the future, but he has a very hard act to follow. The departure from the Front Bench of the noble Lord, Lord Strathclyde, is a moment of great significance for this House. We shall all miss him, and especially so at great occasions, such as Prorogation, through the clerk not having to read out his full name, as that will mean that the Prorogation ceremony will be a good deal shorter.

A former Member of this House, Lord Wilson of Rievaulx—Harold Wilson as was—once very acutely observed that, “A week is a long time in politics”. Having done 25 years on the Conservative Front Bench, I calculate that the noble Lord, Lord Strathclyde, has done 1,300 weeks in politics, which is a very long time indeed. In that time, the noble Lord, Lord Strathclyde, has covered the ground. He entered government in 1988, appointed by the now noble Baroness, Lady Thatcher, as a junior Whip in the old Department of Trade and Industry. There, as I understand it, he met a very young researcher from the Conservative Research Department called David Cameron, a contact which has clearly stood him in very good stead.

Indeed, if my memory serves me correctly, when, after the inconclusive result of the 2010 general election, David Cameron entered a room full of journalists to make his,

“big, open and comprehensive offer”,

to the Liberal Democrats, slipping into the room beside him—the only person to do so—was the noble Lord, Lord Strathclyde. So when the Prime Minister yesterday said in response to the resignation of the noble Lord, Lord Strathclyde, that to him personally he had always been a,

“staunch friend and wise counsel”,

I suspect that was the heartfelt truth.

I am less confident about just how comfortable the noble Lord has been with the results of that big, open and comprehensive offer—that is, the coalition. When it was put to him on “Channel 4 News” last night that he had been reported as saying he despaired that the coalition had broken down in the House of Lords he didn’t quite knock the story down completely when he replied:

“I’m sure that at times … over the … last 18 months I might well have said that.”

Of course, one of the most difficult issues that he has had to deal with since coming into government, again in the coalition, has been House of Lords reform, and in particular the exciting and very well thought-through proposals from his now ex-Cabinet colleague, the Deputy Prime Minister. Tom Strathclyde is, of course, a natural House of Lords reformer. He has shown nothing but utter loyalty to the Government’s now-abandoned proposals for an all or mainly elected House of Lords. We on these Benches of course completely believed him, and saw no signs at all of one

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of the biggest political winks in parliamentary history. All I would report is the view of one Member of this House from his own Benches who said, this morning, about the noble Lord and Lords reform: “There were times when Tom’s tongue was so far in his cheek that it was almost coming out of his ear”. As another of the noble Lord’s colleagues, the noble Lord, Lord Dobbs, once so brilliantly put it: they might very well say that, but we on this side of the House could not possibly comment.

The noble Lord has had a long and highly distinguished political career. Indeed, he was Leader of the Opposition in your Lordships’ House for an astonishing 14 years, serving four leaders of his party in the Commons from 1998 to 2010 among the total of six Tory leaders he has served under. As Leader of the Opposition now, I both admire and am staggered by his tenacity, which was signalled very early on in his political career when in 1983 he bravely stood in the Conservative interest as an MEP candidate in Merseyside East. As natural a Scouser as he is a Lords reformer, sadly the noble Lord did not succeed on that occasion, although I am sure the European yearnings which that effort clearly showed will place him naturally in line with his mentor, the Prime Minister, when he makes his long-awaited speech on Europe.

Both as Leader of the Opposition and leader of his own party in Government, the noble Lord, Lord Strathclyde, has always been a highly capable political operator, a straight dealer and a man of his word. Even so there have been difficult times, of course, but it really cannot have been part of the coalition’s plan for this House, with the coalition’s huge inbuilt political majority, that we on these Benches and others would defeat the Government 59 times so far since May 2010. If on occasion this has led the noble Lord to be pretty robust in his dealings with the House, his own wit and charm, and sometimes pretty old-fashioned bluster, have more than got him through.

I would say that the noble Lord has always been personally warm and friendly to me in our private dealings, even when texting to inform me that the following day’s business has been pulled. I thank him now for his judgment, his trust, his confidences and his counsel. Among the most difficult times we have seen in recent years were the issues we faced over allowances and Peers’ conduct. As leaders throughout that difficult period, we both worked hard to make sure that there was not the slenderest of cigarette papers between us in the service of the House. He played a particularly important role at a decisive moment in getting the new allowances arrangements agreed.

It is true that some of the noble Lord’s strongest fans have not always been found among some of my colleagues on these Benches, especially when he has picked individuals up personally on points in the Chamber. However, politics can be a rough old trade and there can be no doubt that the noble Lord has served his beloved Conservative Party and, in his public duties, the people of this country well and loyally. In particular, I know that noble Lords will want it said that he has served this House well and loyally. The noble Lord, Lord Strathclyde, will be greatly missed and from these Benches we thank him for all he has

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done. We wish him well in his future life beyond Front-Bench politics and we look forward to his maintaining strong and deep connections with your Lordships’ House from a different perspective to his extraordinary contribution from the Front Bench during a quarter of a century of dedicated service.

The Minister of State, Ministry of Justice (Lord McNally): My Lords, when Talleyrand died and Metternich received a telegram saying, “Talleyrand is dead”, he pondered and thought, “Now what does he mean by this?”. There has been something of a similar reaction to the resignation of my noble friend. After his 14 years as a leader in this House and 25 years on the Front Bench, our great media have had to speculate on why he is going. There was even an outrageous suggestion in some of the papers that he could no longer tolerate working with the Liberal Democrats. As my noble friends will confirm, there have been no more harmonious meetings than when Tom Strathclyde has come to give the Liberal Democrats one of his regular pep talks. Indeed, if he were so minded, I would be able to persuade two or three of my friends to make way for him here on our Benches.

The noble Baroness, Lady Royall, mentioned the name. What is in a name? Certainly not much for the William Hickey column of the Daily Express, which says that “Charlie Strathclyde” has departed as the leader. One would have thought that it would get the name right. I had to face—as the noble Baroness said—the annual humiliation at Prorogation when the clerk would read out Thomas Galloway Dunlop du Roy de Blicquy Strathclyde and Tom McNally. At one time I thought of adding Plantagenet just to give it a bit of class.

2.45 pm

The truth is that we have worked closely together for the past eight years but only yesterday I discovered in one of the cuttings that he is a master of the ancient Chinese board-game, Go. I immediately wanted to find what Go was. It is a game of tactics, the grand masters of which are able to think up to 40 moves ahead, even in complicated positions. Instantly, I realised that Tom had been playing Go with me for the past three years.

The Leader of the House has two tasks: one, as the noble Baroness indicated, is to be the leader of his party and to get government business through as a business manager; the second is to be the guardian of the interests of individual Members and the House as a whole. I believe that the noble Lord, Lord Strathclyde, has fulfilled that second role with consummate skill. He steps down with thanks, respect and, I believe, the affection of the whole House. All that I can say to the noble Lord, Lord Hill, is: the best of luck.

Lord Laming: My Lords, on behalf of my colleagues in the Cross-Bench group, I, too, wish to be associated with the warm and very well earned tributes that have been paid already to the noble Lord, Lord Strathclyde. Although still relatively young—in my terms, very young—he has given many years of his life to being an outstanding public servant.

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During the years when he was the Leader of this House he always aimed to act in the best interests of the whole House and his many talents and energy were much admired. My colleagues and I very much hope that the House will continue to have the benefit of his vast experience and wisdom. The noble Lord very much respected the position of the Cross-Bench group, and, as has been said by the noble Lord, Lord McNally, he very much valued the individual contributions of its Members. He also supported the position of the Convenor and well understood that role in treading carefully—sometimes ever so carefully—between the different party political interests in the House. On a personal note I very much enjoyed the regular meetings that I had with him and I will always be grateful for the generous support and encouragement that he readily gave. I wish him well.

Finally, I also take the opportunity to welcome to this important role the noble Lord, Lord Hill of Oareford. The House rightly has a great regard for him and personally, I have valued enormously my contact with him, especially in safeguarding children and young people. On behalf of the Cross-Bench group I welcome him to his new responsibilities and look forward to working with him.

The Lord Bishop of Derby: My Lords, I speak briefly to associate those of us on these Benches with the generous, worthy and well earned words for the noble Lord, Lord Strathclyde. On these Benches, we are transient. We come and go because, as noble Lords know, we observe a retirement age. By contrast, the noble Lord, Lord Strathclyde, is just like a part of the furniture. He is an institution and has been here throughout the time that virtually all of us on these Benches have been here, so it will be a big change for us. My colleagues have been very keen to say how much we appreciate his support, wisdom and guidance for the Lords Spiritual to enable our contribution to the work of the House. Speaking personally, I marvel sometimes when he has to stand at that Box and deal with some rather difficult things coming across the Chamber. I always admire the fact that he is calm, has a twinkle in his eye and generally responds with buckets of common sense. That seems to be a very good way of leading a House and creating the right kind of atmosphere and frame for us.

We also extend our welcome to the noble Lord, Lord Hill. To be honest, on these Benches we have mixed feelings. He has done a wonderful job as Education Minister and has been a great friend to the Church and the Lords Spiritual. In many ways we are very sad to see him leave that post. He has done outstanding work, and I have always admired the way he can stand at the Dispatch Box and, without really referring to his notes, be able to answer the questions and be very astute and quick-thinking on his feet. That is a remarkable gift and one that we look forward to him exercising in his new role. We welcome the noble Lord, Lord Hill, and say thank you very much indeed to the noble Lord, Lord Strathclyde, for his help, support and guidance.

Lord MacGregor of Pulham Market: My Lords, I rise to pay tribute and give warm thanks to my noble friend on behalf of the Association of Conservative Peers for all that he has achieved for this House and

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our party during his long and distinguished career to date. Those of us who have served in government and on opposition Front Benches for a number of years are fully aware of the all-consuming and unremitting pressures and strains that that service brings—and, like other noble Lords, I think I have done my bit. However, we can only marvel at the unbroken record of my noble friend over 25 years as a Minister in many departments, as Deputy Speaker, Deputy Chairman of Committees—briefly—and as a member of shadow Cabinets and Cabinets. Few in either House can rival my noble friend’s record and it is entirely understandable that he should now wish to find time for another life and to pursue the many other interests that have inevitably languished during those years.

The House has changed much since 1999, both in its role and value. It is perhaps true to say that, in earlier years, its contribution was sometimes underestimated among the higher reaches in the other place. That is no longer true today, and my noble friend has played a notable part in bringing that about and in developing our House’s modern role in today’s world. Many of us have discovered that behind the jovial exterior and merry manner lie a shrewd brain, an immense capacity for work and a devotion to the tasks in hand. I will give one example of the latter. No one should underestimate the difficulty of repeating a Statement made by the Prime Minister in the other place following a European Council or other high-level international meeting, at which he was not present and where decisions were inevitably sometimes made in the middle of the night. After possibly only one or two hours’ briefing at the most, my noble friend would have to cover a vast range of issues on which it would be easy to drop a brick; yet he always carried out that role with aplomb. All that experience and understanding of the House and its modern role was brought to bear, in my view, with the skill and subtlety with which he has handled the issue of Lords reform.

As Leader of the House, my noble friend has shown devotion to this place above party politics. As leader of the Conservative Party in the Lords, he has always worked closely with colleagues in the ACP in developing policies, and his door has always been open to us. We welcome our colleague, the noble Lord, Lord Hill, as a very worthy successor, and we thank the noble Lord, Lord Strathclyde, warmly and extend every best wish for success and happiness in whatever avenues he now wishes to pursue.

The Chancellor of the Duchy of Lancaster (Lord Hill of Oareford): My Lords—

Noble Lords: Hear, hear.

Lord Hill of Oareford: I wholeheartedly support the sentiments that have been expressed across the House about my noble friend Lord Strathclyde. Some play has already been made about his name. My noble friend Lord McNally may feel short-changed with a surname like McNally. I say to him, “Try the surname Hill”. This afternoon’s tributes are a testament to the great dedication that my noble friend showed to this House in his remarkable quarter-century of service on the Front Bench.

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My noble friend was a gifted and agile Leader of the Opposition for almost 12 years, before rightly taking his place as an outstanding Leader of this House, working over that time with five different Leaders of the party opposite. Indeed, he led the Conservative Benches for longer than any Peer, save for two distinguished Marquises of Salisbury and the Duke of Wellington. That is not bad company for a Conservative Leader of the House to keep.

Both in opposition and office, during a long period of time in which the House faced change unprecedented in generations, his immense experience and knowledge of—and, I may add, loyalty to—this House have been to the huge benefit of us all. That was given recognition yesterday when the Prime Minister recommended the appointment of the noble Lord, Lord Strathclyde, to the Order of the Companions of Honour, an appointment which brings distinction and due recognition to the work he has done here and as a Minister over so many years.

As a relative newcomer to the House, I am certainly in his debt for the guidance and support he has given me since May 2010. It is rather disconcerting to stand here at the Dispatch Box today without the benefit of his occasional instruction, delivered in a forceful stage whisper from the direction of my right elbow. Since the general election, my noble friend has steered the House with great skill through some unusual and testing times, with the establishment of a coalition Government for the first time since the Second World War. It is not just the Government for whom he has worked tirelessly, but the whole House, whose interests I know he has always guarded at every opportunity.

It is therefore a tremendous privilege to follow my noble friend in serving this House and these Benches as Leader. I have enormous respect for the work of this House, for its role in our constitutional arrangements and for our traditions and courtesies—which, like my predecessors, I hope to be able to help uphold.

My noble friend Lord Strathclyde leaves a large hole on our Front Bench, as well as perhaps a little more space for the rest of us. To succeed him as Leader of this House is therefore an honour that I view rather nervously, but I take great encouragement from the generous remarks that noble Lords have been kind enough to make this afternoon.

Airports: Capacity


2.57 pm

Asked by Lord Spicer

To ask Her Majesty’s Government what was the average percentage of total capacity used at London’s commercial airports over the past six months.

Earl Attlee: My Lords, between May and October 2012 there were 525,000 commercial air transport movements at the five largest commercial London airports: Heathrow, Gatwick, Stansted, Luton and London City. These air transport movements used around 86% of the available runway capacity.

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Lord Spicer: My Lords, why are we allowing the London airport system to run out of capacity?

Earl Attlee: My Lords, we are not. We have set up the South East Airports Task Force to look at short-term measures to gain some capacity at Heathrow. In the rather longer term, we have the aviation policy framework, which we are committed to publishing in March 2013. Finally, we have set up the Airports Commission, headed up by Sir Howard Davies.

Lord Clinton-Davis: Is it not likely that non-British airports will heartily welcome the Government’s unpardonable delay in selecting an international hub airport, whether at Heathrow or elsewhere? What does the Minister say about that?

Earl Attlee: My Lords, this problem was not unforeseeable. It has been coming for many years, including when noble Lords opposite were in government. We need to get a consensus and find a lasting solution that will survive a change in Governments.

Lord Bradshaw: I hope that the noble Earl will ponder the following: a great deal of the heat in the debate about air capacity is caused by the bidding war that has broken out between various airports and airlines. Will the noble Earl ensure that the Davies commission will, to the best of its ability, be governed by the fact that we should create extra capacity only when a real need is demonstrated?

Earl Attlee: My Lords, I am confident that the Airports Commission, headed up by Sir Howard, will consider all relevant matters.

Lord Soley: The Minister will know my opinion on this but I put it to him very strongly that just about everyone in business has been saying that delaying this infrastructure project is crucially bad for the British economy. It is the delay that is causing the problem. If the Government picked up the previous Government’s policy and continued with it we would not be in this situation now. That would not cost a single penny of public money. Please, please move on this for the sake of the British economy, investment and jobs.

Earl Attlee: My Lords, it is important for businesses to put their own submissions in to the Airports Commission, as I think the noble Lord has already done himself.

Lord Elton: My Lords, institutions can scarcely run at 100% capacity, any more than you can have 100% full employment. There has to be some slack in the system. How long does my noble friend think that the 14% capacity that he says is now available will last? What steps are being taken to meet the moment when it is full?

Earl Attlee: My Lords, DfT aviation demand forecasts suggest that with no new runway Gatwick Airport could become full from around 2018 and Stansted

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from around 2030. That is why we have set up the Airports Commission to advise us on viable options for solving this problem.

Lord Brooke of Alverthorpe: My Lords, to come back to the original Question, there is a 14% underuse capacity in the five major London and south-east airports. What plans do the Government have to utilise that capacity, given the failing to direct daily flights to some of the major economies around the world and new developing economies? What can be done immediately and what will the Government do?

Earl Attlee: My Lords, it is important to understand that we are very well connected by Heathrow Airport. It is connected to the rest of the world better than most other places in Europe.

Lord Glenarthur: My Lords, my noble friend’s Question referred specifically to commercial airports, but not far from Heathrow lies Northolt—principally a Royal Air Force airport but used for some other domestic and international semi-commercial flights. What problems and constraints exist in the further use or development of Northolt to add value to what otherwise would be part of the same hub of London airports?

Earl Attlee: My Lords, I understand that there are some difficulties with the runway orientation of Northolt airfield. I am sure that that is a factor that the Airports Commission will take into consideration.

Lord Davies of Oldham: My Lords, in his opening response the noble Earl referred to the fact that a consensus was necessary to make progress over the considerable period of time needed to expand airport capacity. Although he quoted 86% for the south-east airports, we know that Heathrow is at over 99% utilisation and has no scope at all for development. The Opposition have offered to the Government for more than a year now the opportunity to establish a consensus by joint talks. Could the noble Earl at least persuade his ministerial colleagues that these should take place, and that they would be aided by a somewhat earlier timetable for the commission’s report? Why is it having to report after the general election when the urgency of the situation is apparent to everyone?

Earl Attlee: The noble Lord makes a strong point. The Airports Commission will report with its initial findings by the end of the year. I would be delighted to talk to the noble Lord privately when we get that initial report. But it takes time to do the job properly.

Baroness Kramer: My Lords, I wonder if the Minister might remind the House that capacity at Heathrow is for 90 million passengers per year. Currently it has only 70 million passengers a year, because airlines are using small aircraft in order to keep their slots alive and are developing most of their flights within the UK and near continent, not for the long distance routes. Will he explain to the House that capacity is far more

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complex and that there is a great deal of capacity with the potential for much better utilisation already in London?

Earl Attlee: I agree with my noble friend that if you use bigger aircraft you can get more passengers through Heathrow for the same number of flights.

Lord Faulkner of Worcester: My Lords, what proportion of the capacity at Heathrow do the Government estimate will be released if their plans to build High Speed 2—initially to Birmingham and then to Manchester and Leeds—are fulfilled? Is it not the case that when high-speed railways are built on the continent, domestic aviation diminishes and as a result there is spare capacity at airports?

Earl Attlee: The noble Lord makes an important point, but it will not solve our underlying problem that we will still eventually run out of capacity at the London airports.

Housing: New Homes


3.06 pm

Asked By Lord Sheldon

To ask Her Majesty’s Government what plans they have to build more homes in the south-east of England.

The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Hanham): The Government do not set down Whitehall housing targets for the south-east of England or any other part of the country. It is for elected local councils to determine where development should and should not go, and how best to meet housing need through their local plans.

Lord Sheldon: I take notice of the points that the noble Baroness has put forward, but Britain has been building fewer homes in London. In 2011, 18,000 new homes were completed. More houses are needed and they have to be built to meet the requirements.

Baroness Hanham: My Lords, nobody will disagree that we need more housing. I have said that many times in this Chamber. Everybody knows that we have an underhousing situation in this country for our population. Therefore, there is great pressure from my department to ensure that housing targets are built up. However, it is for local authorities to decide where that housing goes and how much they need in their local area. A great number of houses are in the pipeline, due to be built.

Baroness Gardner of Parkes: My Lords, will the Minister confirm that she is willing to support the approval of the financial scheme of guarantee to help

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small builders who desperately need the work and who could provide many homes for the people who are so badly in need of them?

Baroness Hanham: My Lords, the encouragement for small businesses is there. Our position is already to help small businesses. Of course, some small businesses, although not necessarily building a big number of houses, are making a major contribution.

Lord Higgins: My Lords, does my noble friend agree that in carrying out housing programmes it is very important to take into account two recent developments? First, following the Olympics, housing programmes should not infringe on sports grounds and, indeed, should make greater provision for sporting facilities. Secondly, steps should be taken to ensure that housing does not take place in areas that are liable to flooding.

Baroness Hanham: My Lords, again, local authorities and their local plans need to take account of both those matters. It is certainly true that we hope to see the preservation of playing fields, and that the legacy of the Olympics is to be encouraged—exactly the point that my noble friend has made. Of course, it does not make sense, as we have seen recently, to build on flood plains if it is not necessary. However, that is a matter for local authorities’ judgment in terms of the amount of housing they need and where they need to put it.

Lord Kinnock: Is it not clear that the cap on housing benefit means that very large numbers of people now working and living in central London will not, in the course of this year, be able to live near their place of work? Does that not make it a matter of emergency for the Government to undertake a building programme that will mean that affordable housing is available to the people who serve this great city in both the public and private sectors in all capacities? Is it not a dreadful reality that the combination of the cap on housing benefit and the paucity of affordable housing in the public and private sectors will be monstrous in its effects on lower-paid people in this city?

Baroness Hanham: My Lords, it is also monstrous that we are left in the financial situation that we are. That is one reason why the welfare budget has had to be looked at over the past few years. There is also little evidence, except in one or two of the major boroughs, that people are having to move out of London to find housing as a result of the housing benefit situation. We are pushing very hard for the building of affordable housing in the light of whatever local authorities believe they need.

Baroness Maddock: My Lords, does the Minister agree that bringing homes that have been empty long-term back into use can make a useful contribution to housing supply? What scope does she think that there is in the south-east for that, and what are the Government doing to help communities that want to bring long-term empty homes back into use?

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Baroness Hanham: My Lords, the Government have a number of projects that have just come into being to support the bringing back into use of empty homes. Yes, they are a waste and it is essential that long-term empty homes—because some are not empty for long-term reasons—are brought back into use. The Government have this year already committed £160 million. That will bring 10,700 empty homes back into use. There is £100 million for affordable housing, including £70 million of funding for 95 projects, which will bring more than 5,600 properties back into use across the country. My noble friend commented on the south-east but, as I explained, that is across the country.

Lord McKenzie of Luton: My Lords, a recent study by BNP Paribas looked at the extent to which local authorities were changing their housing targets from the regional spatial strategy levels. It found that local authorities in the south-east and the south-west were making the biggest cuts. For the south-east, this amounted to around an 18% reduction. Does the Minister think that that position is satisfactory?

Baroness Hanham: My Lords, I go back to what I said to begin: it is now for local authorities to decide on their housing need against the overall housing position. The noble Lord talks again about the south-east, but the south-east has many local authorities, which are making decisions on housing as we speak.

Baroness Wall of New Barnet: My Lords, I am sure that the noble Baroness is aware of construction jobs that are not being fulfilled in the present climate. Although the Government’s approach to unemployment and apprenticeships is one that everyone endorses and supports, is it not possible for that to be re-enacted in a vigorous and real way to ensure that people in apprenticeships in the construction industry have the opportunity to test their skills in building in the south-east, as housing is important for everyone?

Baroness Hanham: My Lords, apprenticeships are of course allied to companies in the housebuilding business. We very much hope that any apprenticeship taken up in the construction industry will go on to ensure that that person has a full-time job as long as the companies are able to build, which they are.

Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Amendment of Schedule 1) Order 2012


3.13 pm

Asked by Lord Bach

To ask Her Majesty’s Government what plans they have in respect of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (Amendment of Schedule 1) Order 2012, which the House of Lords declined to approve on 3 December.

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The Minister of State, Ministry of Justice (Lord McNally): My Lords, as I made clear before the House voted on 3 December, if the fatal Motion was carried, the LASPO Act would not provide legal aid in the cases specified in the rejected statutory instrument. That remains the case.

Lord Bach: Does the Minister understand that that Answer is entirely unsatisfactory and does no credit to the Government? This House declined to accept the order because it represented a breach of a government undertaking given to another place to get the legal aid Bill through and because what it offered was too mean. Why are the Government taking absolutely no notice of the will of this House of Parliament? Are they not behaving more like a spoilt child than a mature, responsible Government, protecting the legal rights of some of the poorest citizens under their care, including many with disabilities?

Lord McNally: I think that the noble Lord got all his soundbites in there.

Noble Lords: Oh.

Lord McNally: Well, we have had heard it over two years and both Houses have come to decisions on the LASPO Bill. As regards fatal Motions, I can speak from experience. I was part of engineering a fatal Motion on the casino Bill. That fatal Motion was carried by the House. The Government of the day did nothing further on the casino matter. If I may coin a phrase, as it says on the tin, fatal Motions mean what they say.

Lord Pannick: Given that the House rejected as inadequate the limited concession on legal aid in First-tier Tribunals, is it not truly perverse for the Government to respond by withdrawing even that?

Lord McNally: The Government have not withdrawn that concession. This House passed a fatal Motion meaning that that concession was no longer part of the Bill. That was the decision of the House. If I may so in the presence of the noble Lord, Lord Pannick, and of all those who voted for it, I made that very clear to the House before the vote.

Lord Howarth of Newport: Instead of continuing to sulk, would it not be proper for the Government to bring forward another order, in which they honour the commitment rightly given to Parliament by the previous Lord Chancellor?

Lord McNally: I notice that the noble Lord, Lord Bach, again alleged that that commitment was made. It was not made by the previous Lord Chancellor. The commitment was to examine the case for the First-tier Tribunals. As I have reported back to the House on numerous occasions, the decision was that in the circumstances it was far too expensive. It would be nice to have fatal Motions as yet another round in the legislation process, but I ask the House and the Official

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Opposition to think carefully. If fatal Motions are going to be used in this way, they have great repercussions, not least on our relationship with the other place.

Lord Marks of Henley-on-Thames: My Lords, can the Minister confirm that legal aid remains available for advice on appeal from the First-tier Tribunal to the Upper Tribunal in welfare cases? Can he also confirm that where there is a point of law on which an appellant has a reasonable prospect of success, legal aid is and will remain available for the preparation and presentation of an appeal to the Upper Tribunal?

Lord McNally: Yes, that is case. It is also worth making the point that some of the noises from the other side make it sound as though the Government have been totally unfeeling and refusing to listen.

Noble Lords: Hear, hear.

Lord McNally: Well, it is worth reminding noble Lords that when the Legal Aid, Sentencing and Punishment of Offenders Bill was published the initial idea was that legal aid was not required in any welfare benefit cases, other than for judicial review or for a small number cases based on the Equality Act 2010. Throughout the course of the LASPO Bill the Government were urged to rethink their position on removing legal aid for onward appeals to the Upper Tribunal, which had to be on a point of law.

The Government listened to these concerns and offered concessions during the passage of the Bill to bring into the scope of legal aid advice and assistance for welfare benefit appeals on a point of law in the Upper Tribunal, Court of Appeal, Supreme Court, and representation for the welfare benefit appeals in the Court of Appeal and Supreme Court. These were concessions in which my noble friends played a considerable part in achieving. The idea of an unlistening and unfeeling Government is simply not true. If the House forces through fatal Motions, it must take the consequences.

Baroness Scotland of Asthal: Does the noble Lord not understand that the initial position put forward in the LASPO Bill was totally untenable? That is why it was amended. Does he not also accept that after the House has spoken on this fatal Motion, the Government are obliged to listen—and by “listen” I mean do something in response?

Lord McNally: The noble and learned Baroness suggests that the Government, as if in some game of poker, have to produce another offer in response to a fatal Motion. A fatal Motion is what it says—it is fatal. As I have pointed out, there was the example of the casino Bill in the previous Parliament. One of the reasons why successive Oppositions have thought long and hard about using fatal Motions is that they have implications about where and when the arguments and discussions about a Bill come to an end and how that relates to the relationship between the two Houses. Such Motions can be very toxic. I warned the House

8 Jan 2013 : Column 15

and the noble Lord, Lord Bach, of that, but he pressed ahead. A fatal Motion was passed and it has been fatal.

Lord Grocott: My Lords, the Minister’s whole approach in answering questions today gives the House a great deal of explanation for why he sometimes finds it difficult to get Motions, including fatal Motions, through. He clearly misunderstands the procedure, which is as follows. Yes, an order can be defeated by a fatal Motion, but a Minister given to conciliatory thinking—something that apparently does not appeal to him—should then go to the opponents of the order and suggest to them various possibilities for ways in which an order could be put before the House and might then pass. Such negotiations may or may not be successful, but the Minister at least owes it to the House to tell us precisely what efforts he has made to ensure that an amended Motion can be put to the House that might command its support.

Lord McNally: I am making no efforts to make such a proposal. The fatal Motion is fatal—that is the end. The noble Lord, Lord Bach, has gone around this track, but in a parliamentary process there must come a point when a Bill becomes an Act and a law is passed. If the Opposition’s plan, and it would be interesting to know this, is to use fatal Motions on a regular basis to try to keep alive issues that have been decided by both Houses through proper Bill procedures, then we are going into new territory. I am sorry but the House heard my warning and ignored it, and the Bill is now an Act.

Economy: Effect of US “Fiscal Cliff” Solution


3.22 pm

Asked By Lord Barnett

To ask Her Majesty’s Government what assessment they have made of the effect of the “fiscal cliff” solution in the United States on the United Kingdom economy.

Lord Newby: My Lords, the Office for Budget Responsibility based its December 2012 forecasts for the UK economy on the assumption that fiscal policy would be tightened in the US by between 1% and 2% of US GDP. This is what is now happening. The Congressional Budget Office’s assessment of the American Taxpayer Relief Act, the measure agreed by Congress last week, is that it will produce a fiscal tightening of 1.7% of US GDP.

Lord Barnett: Of course, my Lords, the cliff-edge solution did not solve any fundamental problem, any more than our fundamental problem in this country has been solved. That problem requires us to achieve sustainable growth. The Government are taking a few steps in that direction with their infrastructure plans but none of those will do anything now, and urgent action is needed now. Does the noble Lord accept that

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one way of doing that would be for the Government to find some modest capital, comparatively speaking, because companies are simply not willing to borrow, whether under guarantee or not? The Government will have to kick-start infrastructure if they want to see growth start. Does he agree that that would be a way forward?

Lord Newby: My Lords, the noble Lord will recall that in the Pre-Budget Statement my right honourable friend the Chancellor announced another £5.5 billion of additional capital spending on roads, science infrastructure and schools, and that earlier in the autumn we passed an Act providing guarantees for £40 billion for infrastructure and another £10 billion for housing. The Government are making considerable efforts to increase the amount of infrastructure activity.

Lord Peston: My Lords, as a life-long opponent of the death penalty, I might make an exception for whoever—I hope it was not an economist—invented the expression “fiscal cliff”. Do the Government accept the analysis that if the US goes more deeply into recession it will have devastating adverse effects on the whole of the European economy and no policy envisaged by this Government would be any use whatever?

Lord Newby: I think the noble Lord slightly overstates it. The fiscal cliff—elegant or inelegant—has been avoided and the expectations and the forecast for the US are that it will see relatively modest, but substantive, growth in 2013. As the noble Lord will know, the latest employment figures in the US suggest that there has been a significant addition to the number of people employed. Therefore, the chances of the kind of meltdown in the US economy that he is worried about look extraordinarily remote.

Baroness Kramer: My Lords, the US faces an even worse fiscal cliff in seven weeks. As the British Government are unlikely to have much impact on Republicans infused by the Tea Party, I suggest that it would be a better strategy for this Government to put their efforts into getting formal negotiations on EU/US trade in order to take away the technical barriers that the US is using at the moment to limit UK exports in pharmaceuticals, medical services and advanced electronics. That might be a more positive way forward.

Lord Newby: My Lords, I completely agree with the noble Baroness. That is why the Prime Minister has set promoting a US/EU trade agreement as one of his top priorities for the G8, as well as moving forward on other trade agreements, such as that with Canada, which are already a long way down the pipeline.

Lord Eatwell: My Lords, will the noble Lord consider answering the Question asked by my noble friend Lord Barnett? He asked what the assessment was of the impact of the fiscal cliff solution on the UK economy. As the noble Lord said, this had led to a 1.7% increase in the fiscal burden on GDP, and the debt ceiling debates in seven weeks’ time referred to by

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the noble Baroness, Lady Kramer, may add further burdens to the US economy. Is this good or bad for Britain?

Lord Newby: Whether it is good or bad for Britain, it is what is happening in the US. What I said in my original Answer was that the estimates, which were published by the ONS at the time of the Autumn Statement, were based on an assessment of what was likely to happen, which is exactly what has happened. The Bill passed last week is having an impact of 1.7% on US GDP. The ONS assumed that the Bill passed last week would have an impact of about 1.7% on US GDP. We factored that into our calculations and the growth forecast produced for this year will be unchanged because what has actually happened is what we thought was going to happen.

Arrangement of Business


3.28 pm

Baroness Anelay of St Johns: My Lords, before my noble friends Lord Taylor of Holbeach and Lord Howe repeat the Answers to the Urgent Questions asked earlier in the House of Commons, perhaps I may remind the House that we recently agreed a new trial procedure and this is the first occasion on which we are able to take advantage of it and see how it begins to run.

My noble friend Lord Taylor will first repeat the Answer to the Urgent Question in full. At that point the Clerks will start the clock running for 10 minutes. During those 10 minutes, questions and answers will follow. We have anticipated that the first question is likely to come from the opposition Front Bench. It was decided that the usual channels, if they wished, could dispense with that but that has not happened today so I would expect the opposition Front Bench to come first. The rules that follow for questions and answers are the same as those for a Private Notice Question of this House.

Ibrahim Magag: Disappearance


3.29 pm

The Parliamentary Under-Secretary of State, Home Office (Lord Taylor of Holbeach): My Lords, I will now repeat the Answer to an Urgent Question asked in the other place earlier today. The Answer, given by my right honourable friend the Home Secretary, is as follows:

“On 26 December 2012, Ibrahim Magag, a Somali-born British national who is subject to a terrorism prevention and investigation measure, failed to report for his overnight residence requirement. As I told the House yesterday, the police believe that he has absconded, and his whereabouts are currently unknown.

On 31 December, at the request of the police, I asked the High Court to revoke the anonymity order that was in force in relation to Magag. The police

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subsequently issued a public appeal for information that might lead to his location and apprehension. The Government took steps to inform Parliament of this incident as soon as it was lawful and operationally possible to do so. The Under-Secretary of State for the Home Department spoke to the chairmen of the Home Affairs Select Committee and the Intelligence and Security Committee on 31 December. This was followed by letters to both committee chairmen, to the shadow Home Secretary and to you, Mr Speaker. Copies of those letters were placed in the Library of the House on the same day.

The statements that the police issued on 31 December and on 2 January confirm that, at this time, Magag is not considered to represent a direct threat to the British public. The TPIM notice in this case was intended primarily to prevent fundraising and overseas travel. The Government do not believe that Magag’s disappearance is linked to any current terrorism planning in the UK. Nevertheless, we are of course taking this matter very seriously.

The police are doing everything in their power to apprehend Magag as quickly as possible. Although I cannot give operational details, I can confirm that the police, the Security Service and other agencies are devoting significant resources to the search for Magag. Members of the public with any information relating to the search should contact the confidential police anti-terrorist hotline.

Before the shadow Home Secretary stands up again, I would like to remind the House that this is not the first abscond of a terror suspect. In six years of control orders, there were seven absconds. Of those seven cases, six were never apprehended. Magag’s abscond is serious, and the authorities are doing everything they can to locate him. I will update the House when there are further developments as soon as it is possible to do so”.

3.32 pm

Baroness Smith of Basildon: My Lords, I thank the Minister for repeating the Answer to the Urgent Question. He will understand that it is of enormous concern that Ibrahim Magag, who is subject to a TPIM—a terrorism prevention and investigation measure—has been able to abscond, particularly when the judge who reviewed his previous control order said that,

“it is too dangerous to permit him to be in London, even for a short period”.

The Minister referred to how many people had absconded under previous control orders, but the key issue was relocating those subject to an order. My understanding was that none absconded after they had been relocated. However, the Government took the decision to remove the power to relocate suspects when introducing TPIMs. Given that they allowed him to move back to London from the West Country, to where he had been relocated by the previous Government’s control order, can the Minister confirm whether that made it easier for him to abscond? Was he subject to any surveillance at the time?

Finally, is it true that he absconded by hailing a black cab?

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Lord Taylor of Holbeach: I can confirm the latter point. The last time he was seen, he was reported as getting into a taxi.

The noble Baroness misconstrues the nature of the TPIM system, which succeeds the control order system but is designed to provide proportionate supervision for people where evidence does not exist to secure a conviction. The only true way of dealing with terrorists is to find the evidence to convict them and to put them into prison; that is the only secure place that we can put them. That is a process of law for which we require evidence. TPIM is a mechanism whereby we can at least prevent the movement and control the location of individuals in the way that we have done.

Lord Dholakia: My Lords, Parliament rightly put TPIMs at the heart of our intelligence, but in the case of Ibrahim Magag they obviously did not work. Is the Minister satisfied that the system, particularly the machinery and equipment available, is adequate for the operation? If not, what further improvements are necessary?

Lord Taylor of Holbeach: We can, of course, always review the circumstances of this particular incident in the light of experience, but we know that the resources available to deal with people such as Magag are considerable, and that they have been designed to prevent things like this from happening. As I said, it is very difficult to prevent people from absconding. We know that it happened under the old regime; this is the first—unfortunate—case under a TPIM.

Lord Reid of Cardowan: Does the Minister not understand that he misses the point? We all understand and accept that control orders and TPIMs are extraordinary measures. We understand that the ideal is to have a trial in a court of law with sufficient evidence. That is agreed. Nevertheless, the point is that, although control orders were inadequate—the Minister pointed to some absconding under them—the power to relocate was the biggest weapon in that inadequate arsenal. After the use of that no one, to my knowledge, absconded. However, the point is that the Government removed that one effective vehicle in the control orders when they brought in TPIMs. Will he now bear that in mind and at least assure the House that he will review the operations of TPIMs to see whether what I am saying is correct?

Lord Taylor of Holbeach: I cannot accept what the noble Lord says, but I accept that he speaks from considerable experience in this area. Governments would be very foolish not to learn from experience. However, there is no evidence to suggest that the fact that Magag was here in London particularly assisted his absconding on this occasion. I accept, as the noble Lord said, that incidents like this should be reviewed, and they will be.

Lord Laming: Will the Minister say what lessons have been learnt from this experience, and what steps have been taken to ensure that further lessons will be acted upon?

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Lord Taylor of Holbeach: I hope that I have just given the noble Lord an indication of the way we think about these matters. It is too soon to say whether lessons can be learnt. The most important thing is to ascertain the whereabouts of this person and to apprehend him.

Lord Carlile of Berriew: Will the Minister accept that the fact that Mr Magag did not abscond while subject to a judicially approved relocation order, and that he absconded when that was removed, is in itself clear evidence of the poor decision to remove relocation orders? Will he also acknowledge that nobody absconded while subject to a relocation order, and that there were no absconds at all during the last four and a half years of control orders?

Lord Taylor of Holbeach: Again, the noble Lord speaks with a great deal of experience on this issue. I note the point that he makes, but I have given my answer and I hope that noble Lords will accept it.

Lord West of Spithead: My Lords, when I took over as Minister for Security we pushed hard to allow people to be moved out of the places where they were causing so much trouble, and from that moment not a single person absconded. Quite clearly, therefore, the fact that these people are not moved has an impact. Is it not true that TPIMs also take up more effort from the agencies and Security Service as well? Although none of us liked control orders, they were a way of ensuring the safety and security of our nation, particularly with those movement orders. I am afraid that the TPIMs, having removed those movement orders, put people at risk.

Lord Taylor of Holbeach: I believe that I have given the noble Lord the answer, which I have given before. Of course, we will learn from this experience, but there are no current plans to reintroduce controls over movement.

Lord Lloyd of Berwick: Will the Minister inform the House how many individuals are currently subject to TPIM orders, and how many of those individuals have been made subject to such orders on the grounds, if I have followed the noble Lord correctly, that they have been raising finance for foreign terrorists?

Lord Taylor of Holbeach: I can inform the House that 10 people are subject to TPIMs. I cannot give the grounds for any of those orders having been made.

Lord Dubs: The Minister said that this was an instance where there was not enough evidence to take the person to court. Perhaps I may say to the Minister, if we were to use intercept evidence, would we not be able to bring all these people to court? Is it not time for the Government to move forward on working out a system whereby intercept evidence could be used in these cases?

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Lord Taylor of Holbeach: The noble Lord moves the argument on considerably. We will have an opportunity to discuss all sorts of elements. Intercept is not communications data, but such data have been discussed in pre-legislative scrutiny by both Houses. Therefore, these matters are under consideration.

Lord Harris of Haringey: When introducing the legislation that brought about TPIMs, the noble Lord’s predecessor assured the House that not only would extra surveillance resources be made available to the police and the Security Service but also that extra technological measures would be taken to ensure that individuals did not abscond. Perhaps the noble Lord will tell us whether the technological measures were the cause of failure in this instance and, if so, whether the technology that has been purchased has given value for money.

Lord Taylor of Holbeach: I am not in a position to give an answer to that. I am sure that the noble Lord will understand why.

Baroness Farrington of Ribbleton: My Lords, I have listened with great care because I have great respect for the Minister, but I do not hear a single argument in favour of getting rid of relocation. Will the Minister tell me what that argument is?

Lord Taylor of Holbeach: When it was introduced to the House, the legislation did not provide for relocation as being a proportionate measure to be taken in such cases. It was debated by Parliament and the provision was made. Therefore, that provision currently does not exist in TPIMs.

Baroness Falkner of Margravine: Does my noble friend agree that the Joint Committee on Human Rights, of which several Members of the opposition Benches were members, examined control orders extensively in 2009? It recommended wholeheartedly that relocation to distant places away from family and support systems was no different from house arrest and was deeply disproportionate. The Joint Committee on Human Rights said that, in terms.

Lord Taylor of Holbeach: I have given the view of the Government that it is important to establish proportionality in all these cases, which is why TPIMs are constructed as they are.

NHS: South London Healthcare Trust


3.42 pm

The Parliamentary Under-Secretary of State, Department of Health (Earl Howe): My Lords, I shall now repeat as a statement the Answer given by my right honourable friend the Secretary of State for Health in another place earlier today to an Urgent Question on the report of the trust special administrator to South London Healthcare NHS Trust. The statement is as follows:

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“I have today published the final report of the trust special administrator to South London Healthcare NHS Trust and laid it before Parliament. I received the report yesterday and must now consider it carefully. I am under a statutory duty to take a decision by 1 February on how best to secure a sustainable future for services provided by the trust.

The trust administrator began his appointment on 16 July. He published his draft report on 29 October, and undertook a consultation on his draft recommendations between 2 November and 13 December. More than 27,000 full consultation documents and 104,000 summary documents were distributed during the trust special administrator’s consultation, sent to 2,000 locations across south-east London, including hospital sites, GP surgeries, libraries and town halls. A dedicated website was established to support the consultation, the TSA team arranged or attended more than 100 events or meetings and the consultation generated more than 8,200 responses.

I understand the concerns of honourable Members and, indeed, the people living in the areas affected by these proposals, especially the people of Lewisham. They have a right to expect the highest-quality NHS care, and I have a duty to ensure that they receive it. However, they will understand that it would not be appropriate for me to give a view now on the report’s recommendations, only one day after receiving the report. To do so would be pre-emptive, and would prejudice my duty to consider the recommendations with care and reach a decision that is in the best interests of the people of south-east London.

However, I have made it clear that any solution would need to satisfy the four tests outlined by the Prime Minister and my right honourable predecessor with respect to any major reconfigurations. The changes must have support from GP commissioners; the public, patients and local authorities must have been genuinely engaged in the process; the recommendations must be underpinned by a clear clinical evidence base; and the changes must give patients a choice of good-quality providers.

The challenges facing South London Healthcare NHS Trust are complex and long-standing, but to fail to address them is to penalise other parts of the NHS from which resources must be taken to finance the biggest deficit anywhere in the NHS. To date, it has not proved possible to ensure that South London Healthcare NHS Trust is able to secure a sustainable future for its services within its existing configuration and organisational form. In appointing a trust special administrator to the trust, the Government’s priority was to ensure that patients continue to receive high-quality, sustainable NHS services. I will consider the special administrator’s report with that objective in mind”.

My Lords, that concludes the statement.

3.45 pm

Baroness Wheeler: I thank the Minister for repeating the Answer to the Urgent Question. We commend the work of the trust special administrator and support a number of the recommendations developed from previous reviews. However, it is difficult to understand how the Government consider this report to constitute the full

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strategic review of the sustainability of services across south-east London that is required. The TSA has overstepped its remit under the Health Act 2009 by including service changes to Lewisham hospital; and the parallel work by King’s Health Partners on reconfiguration under three other south-east London trusts has yet to be completed.

Can the Minister explain why the rules on making changes to hospitals have been changed to allow back-door reconfigurations in this way without proper scrutiny and consultation? What public consultation will there be on the King’s Health Partners report? Can he reassure the people of Lewisham that they will have their full consultation rights to challenge the closure of their A&E services and the other major changes being proposed?

Earl Howe: My Lords, I am grateful to the noble Baroness and I understand the concerns that she has raised.

The first question she asked me was whether I considered the trust special administrator to have overstepped his remit. The clear advice that we have received is that no part of the NHS can exist in a vacuum. The independent trust special administrator is responsible for developing recommendations to deal with the severe failings at South London Healthcare Trust based on local discussions and consultation. I hope that the statement I read out gave the House a flavour of how extensive those consultations have been. His recommendations must secure high-quality care for local people in a financially sustainable way.

However, as I have mentioned, each NHS trust is part of a complex, wider health system, and it is quite clearly the view of the administrator in this case that it is not possible to find a solution without considering the possible impact on other hospitals in the areas. That conclusion is one that my right honourable friend will have to consider very carefully, but Ministers have received clear advice that it is within the powers of the administrator to make recommendations about necessary changes to other local providers if they are a necessary and consequential part of finding a long-term solution to securing high-quality services for patients at that trust. I emphasise that I do not in any way wish to pre-empt the decision that my right honourable friend has to take within 20 working days. However, he will have to consider advice on the clinical, legal and financial aspects of the administrator’s recommendations and I have no doubt that concerns raised by the noble Baroness will be central to his consideration.

Lord Warner: My Lords, I declare an interest as the former chairman of the provider agency in the London SHA area who grappled with some of these problems in south-east London which, to the best of my knowledge, have been around for at least 20 years. I congratulate the TSA on the work that he has done in trying to resolve this. Could the Minister explain a little more about the involvement of Guy’s and St Thomas’s Hospital and King’s College Hospital? The TSA is to be congratulated on involving them much more than has been the case in the past in finding solutions in this

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area because the failure of those two powerful hospitals to get involved in sorting out the mess in south-east London has bedevilled earlier solutions.

Earl Howe: My Lords, I am grateful to the noble Lord, who I know well appreciates the scale of the problem with which the administrator was grappling. This trust was losing more than £1 million a week. That is not a sustainable position in the current NHS, or even when times were rosier as regards the financial settlement. It is important for me not to say anything that will pre-empt my right honourable friend’s conclusion, but I am aware, from the press release issued today by the trust special administrator, that, as the noble Lord rightly says, the wider health economy has been taken into consideration, including the role of Guy’s and King’s College Hospital, in a number of areas, including, in particular, in emergency care and in obstetrician-led maternity care. I would commend to the noble Lord a summary of the recommendations, which is on the department’s website today. I hope he will find that helpful in giving him a sense of the breadth of the administrator’s purview.

Baroness Donaghy: Is the Minister aware of the extreme anxiety among the population in Lewisham about the possible future closure of the A&E department in Lewisham? The population of 250,000 is estimated to rise to 300,000 in a very few years’ time as a result of a huge increase in the birth rate. There are very deep social needs and there is no doubt whatever that there is unanimity among the professionals and the population about the importance of maintaining that hospital. Is the Minister also concerned that one report that was produced, which was supposedly a clinical report, in fact turned out to be written by the communications department? Is he satisfied that the process has been a fair one and that there has not been a prejudgment in the consultation exercise?

Earl Howe: My Lords, all questions of process must be for my right honourable friend to consider, including that one. I emphasise the Government’s approach to reconfiguration decisions. When the Government came into office, we took a very clear decision about four tests that needed to be applied to any sustainable reconfiguration within the NHS: the changes, whatever they were, had to command support from GP commissioners—that is to say, the clinical community; the public must be engaged in the process; the recommendations must be clinically sustainable and sound; and, as the statement mentioned, they must leave patients with a clear choice of good-quality providers. Those safeguards were not there before, but they are there now and my right honourable friend will be looking at those tests when he considers not just the matter of Lewisham but the totality of the administrator’s recommendations.

Baroness Jolly: My Lords, today it is the South London Healthcare Trust, and there is anxiety abroad that tomorrow it could well be another trust. Can the Minister tell the House how many trusts are in the “at risk” box today and what role is being played by Monitor and others in these cases?

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Earl Howe: My Lords, it is important to stress to my noble friend that a trust will be put into special administration only when all other options have been exhausted. I think that the noble Lord, Lord Warner, is aware that that was the situation we faced in this instance. Where possible, NHS providers will be supported to return to sustainability in both the clinical and financial sense. Our priority is to do what is best to ensure that patients receive high-quality care and special administration is a last resort. However, as my noble friend knows, a number of trusts are facing financial challenges. The department is working with Monitor and the NHS Trust Development Authority to oversee the performance of those trusts. I would just say that while some organisations are in difficulties, currently there are absolutely no firm plans to trigger the regime for any other trusts at all.

Baroness Wall of New Barnet: My Lords, I am sure that the noble Earl recognises the experience I have had as chairman of the Barnet and Chase Farm Hospitals NHS Trust, which went through a similar exercise that took many years. First, however, I want to associate myself with the comments made by my noble friend Lord Warner, and I support the action that has been taken. I recognise what my noble friend said about the concerns of the local community, but that will always be the case. However, what is most important is to make the decision and secure the support of outlying hospitals. My own trust is working towards a partnership with the Royal Free Hospital, although we are not there yet. The move could have been considered much earlier, which would have prevented a lot of pain and heartache for many people. My advice and plea is to stick with what is being done. That did not happen for Barnet and Chase Farm. As noble Lords know, a number of holds were put on what we were doing that made things worse for the community and for the staff. They almost ensured that the services we were providing were harder to deliver.

Earl Howe: As ever, I am grateful to the noble Baroness for her perspective from the front line. I think it was with that in mind that the previous Government drew up the legislation which my right honourable friend now has to abide by, in that there is now a very tight timescale of 20 working days for him to take a decision. That is not a long time but it is indicative of the need for urgency in arriving at the right solution. The TSA has done his work and we must now judge whether the recommendations are the right ones.

Public Service Pensions Bill

Order of Consideration Motion

3.57 pm

Moved By Earl Attlee

That it be an instruction to the Committee of the Whole House to which the Public Service Pensions Bill has been committed that they consider the Bill in the following order:

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Clause 1, Schedule 1, Clause 2, Schedule 2, Clause 3, Schedule 3, Clauses 4 to 15, Schedule 4, Clause 16, Schedule 5, Clause 17, Schedule 6, Clause 18, Schedule 7, Clauses 19 to 24, Schedule 8, Clauses 25 and 26, Schedule 9, Clauses 27 and 28, Schedule 10, Clauses 29 and 30, Schedule 11, Clauses 31 to 38.

Motion agreed.

Growth and Infrastructure Bill

Second Reading

3.58 pm

Moved By Baroness Hanham

That the Bill be read a second time.

The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Hanham): My Lords, this Bill is primarily a deregulatory measure in support of the Government’s decisive actions to put the country’s economy back on a stable footing and to restore growth. The challenges we face mean that we must constantly keep in mind what more needs to be done to encourage innovation and economic growth, to create more jobs and to tackle anything which acts as a barrier to this happening. That is why the Bill focuses on reforms that will boost Britain’s infrastructure, get rid of unnecessary bureaucracy and ensure that our planning system operates effectively. It brings forward provisions that will remove constraints on economic development caused by the planning system, help to unlock land for housing growth to ensure that sufficient housing can be built for future needs, speed up the essential delivery of superfast broadband—country-wide, but particularly in rural areas—remove barriers and delay to major infrastructure projects, introduce measures to support business directly by providing certainty on business rates, and introduce a new employment status.

Turning to these themes in the Bill itself, perhaps I may start by addressing Clauses 1 and 6 on planning and housing. Despite the improvement in housebuilding starts across England, which were 29% higher in 2011 compared to 2009, and the publication of a comprehensive housing strategy, there is far more to do to provide homes to meet Britain’s demographic needs and to help generate local economic growth. Following the introduction of the National Planning Policy Framework there is now a more positive and inclusive planning system. The framework remains at the centre of our planning policy and the measures within the Bill are all aimed at simplifying and improving the locally led planning system so that it works effectively for local communities and businesses.

Most councils are already dealing with planning applications efficiently; the approval rate is at a 10-year high of 88%. However, a small number of local planning authorities make unnecessarily slow decisions. They consistently fail to meet the statutory time limits within which councils should process major applications, as agreed by Parliament. Others see a relatively high proportion of their decisions to refuse applications overturned at appeal. That is a particular issue with major schemes, given the relatively high cost of preparing

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them and their importance for growth. Clause 1 therefore provides an incentive for poorly performing councils to improve and an alternative route for developers if they do not. However, as the Planning Minister has made clear in the other place, we fully intend that these provisions will be applicable only to a small number of planning authorities and we would be delighted if it were not necessary for any local authority to be designated under this clause, with all local authorities making sound and timely decisions on applications.

Turning to Clause 6, the need for housing—particularly, affordable housing—remains high. The Government are committed to unlocking stalled sites where previously negotiated affordable housing obligations are unviable because they are currently economically unrealistic. Clause 6 presents an opportunity to stimulate housing growth and will be a vital component in the drive to get more affordable housing built. Stalled sites mean that there is no local growth, community benefit, or new or affordable housing. Across the country there are 1,400 stalled sites, with the capacity for 75,000 homes. Clause 6 will enable developers to challenge the local authority on the affordable housing elements of its Section 106 requirements in a fast-track decision-making process. It presents a real opportunity to ensure that consents are viable and realistic. Furthermore, it addresses the reluctance of some local authorities to renegotiate currently unrealistic affordable housing requirements, agreed in different market conditions. We recognise, of course, that many local authorities have already opened such negotiations, but not all have.

As well as the measures in Clauses 1 and 6, the Bill makes a number of other changes, through Clauses 2 to 5 and Clauses 7 and 9, which will make the planning process simpler while retaining important safeguards. Clause 2 expands inspectors’ powers to award and recover costs at planning appeals. Clause 3 corrects a legislative anomaly to enable the Secretary of State to award costs between the parties when a compulsory purchase inquiry is cancelled and when a party does not appear at an inquiry that is held. Clause 4 will help to ensure that best use is made of existing buildings and brownfield land by making changes to existing powers to grant permitted development rights. Clause 5 will ensure that information requests made by local authorities are genuinely related to planning and the nature and scale of the development proposed. Clause 7 will make it easier for local authorities to choose, if they wish, to dispose of surplus land held for planning purposes, which will help to get more brownfield land back into productive use. Clause 9 will allow mineral planning authorities in England greater discretion as to whether and when to undertake a periodic review of the mineral provisions.

I turn now to Clause 8, which I left out in addressing the first nine clauses. Because of its critical importance to the United Kingdom’s long-term economic future, the Government’s ambition is for this country to have the best superfast broadband network in Europe by 2015. Clause 8 is particularly important as it will potentially help to give over 4 million more people access to fixed superfast broadband, particularly those in rural and hard-to-reach areas of the country.

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Let me be clear that it is not our intention to use the Clause 8 power to remove prior approval requirements for mobile masts. We intend to use it for fixed infrastructure: cabinets and poles only. The clause makes no distinction between fixed and mobile infrastructure because of EU regulatory requirements for the communications sector. Article 8(1) of the framework directive requires technology neutrality so far as the primary implementing legislation is concerned. However, the requirement for neutrality does not apply to secondary legislation, and therefore the consultation we will publish later this month on the changes that we will bring forward through secondary legislation will make clear that we propose to use Clause 8 for fixed infrastructure—cabinets and poles—and not mobile masts. In the 1980s, deregulation led to the modern communications industry we enjoy today, through the abolition of special TV licences for satellite dishes and the introduction of permitted development rights for those dishes. The Bill seeks to provide the same impetus to the rollout of 21st-century superfast broadband technology.

Clauses 10 to 16 take forward a number of recommendations from the Penfold review to remove overlapping development consent regimes, where multiple permissions from different government agencies are required on top of planning permission. However, I shall focus today on the proposed reforms to the system for registering town and village greens in England, which will harmonise with the democratically accountable planning system. The changes will prevent green applications being used to stop or delay planned development. Another aim is to reduce the financial burden and red tape for local authorities and landowners. For the avoidance of doubt, the reforms will not affect existing registered town and village greens, which will continue to be given strong protection. We have also set out a new local green space designation to give special protection to local green areas, including recreational land, which local people can affect through local and neighbourhood plans. We have set out in the National Planning Policy Framework how local people can use the designation, together with important safeguards for existing open spaces.

Clause 13 introduces landowner statements. Landowners will be able to deposit with the commons registration authority statements which bring to an end any use of their land up to that point as being “as of right”, which is one of the criteria for registering land as a town or village green. This mechanism will allow landowners to tolerate any recreational use of their land without fear that the land could be registered as a town or village green.

Clause 14 covers interaction with the planning system. This is achieved through making changes to the Commons Act 2006 which will prevent green applications being made where planning permission has been granted or where a planning application has been publicised and the decision is still to be made. Equally importantly, the changes will prevent town and village green applications for land identified for potential development in local and neighbourhood plans, including draft plans.

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Clause 15 amends existing fee-making powers for applications to amend the registers of common land and town and village greens under Part 1 of the Commons Act 2006. The purpose is to provide greater flexibility and targeting of fees, in particular to allow them to be levied by different bodies where more than one authority is involved in determining an application.

Clauses 17 to 24 include a number of measures to support the development of the infrastructure that is vital to economic growth. Clauses 17 to 20 have the potential to unlock thousands of new jobs and millions of pounds of new investment in energy projects, and Clauses 21 to 24 will remove delays that can hold back major infrastructure projects. Ofgem’s proposed £160 million gas network innovation competition, specifically the funding mechanism, is currently being delayed because of regulatory ambiguity in the Gas Act. Clause 17 puts beyond doubt Ofgem’s ability to put in place conditions allowing the gas network innovation competition to proceed.

Clauses 18 and 19 enable holders of Section 36 Electricity Act 1989 consents for power-generating stations to have them varied to take account of significant technology and design changes without the need to make a new application under the Planning Act. Clause 20 provides legislative clarity on the requirements for development consents relevant under the pre-Planning Act regime.

Clause 21 makes clear our commitment to expand and improve the one-stop-shop approach for non-planning consents for national major infrastructure projects, while ensuring that interested and affected parties continue to be consulted on proposals. In line with the deregulatory theme of the Bill, Clause 21 and some parts of Clauses 22 and 23 remove the need for a number of additional certificates and consents to be issued separately and allow for the relevant issues to be covered during the development consent order process, which will provide savings to business.

Clauses 22 and 23 update existing legislation on the special parliamentary procedure to ensure that nationally significant major infrastructure projects are brought forward as quickly as possible. The Bill makes changes that will reduce the number of circumstances in which the special parliamentary procedure is triggered. It will also address inconsistencies between different pieces of legislation to limit consideration under the special parliamentary procedure to the compulsory acquisition of special land. This responds to a joint report in 2012 on special parliamentary procedure by the Chairman of Ways and Means and the Chairman of Committees, which urged the Government,

“to rectify these anomalies as a matter of priority”,

and to a commitment made by the Government to reform special parliamentary procedure for nationally significant infrastructure projects at the earliest opportunity.

It is vitally important to the health of the United Kingdom economy that the development of projects of national significance that are needed should go ahead with the minimum of delay. But the speed with which large-scale major applications are determined is falling: the number of cases taking more than 52 weeks to decide has increased from 8% to 13%. Clause 24

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therefore includes a measure to broaden the scope of the nationally significant infrastructure planning regime so that developers of business and commercial schemes can choose whether to apply to the local council for planning permission or to request to use the infrastructure regime.

Clauses 25 and 26 concern business rates. As well as measures to streamline planning and boost investment in housing and infrastructure, the Bill includes measures to support business directly. Clause 25 provides certainty by postponing the revaluation of business rates from 2015 to 2017. Tax stability is vital to businesses looking to grow and to help improve the economy. Postponing revaluation in England from 2015 will avoid sharp changes and unexpected increases in business rate bills over the next five years.

As business rates are linked to inflation, there will be no real-terms increase. This reform will provide certainty for business to plan and invest, supporting local economic growth. Independent initial estimates published in full by the Valuation Office Agency suggest that 800,000 premises would have seen a real-terms increase in their rates at a 2015 revaluation. As local government finance is a devolved matter, Clause 26 provides the Welsh Assembly Government with the power to make a similar postponement if they so choose.

Finally, Clause 27 sets out a new employment status of employee shareholder, which will give both companies and people more options. Simon Walker from the Institute of Directors said:

“This scheme has the potential to reduce the employment law burden on companies and make employees better off at the same time”.

Stuart Rose, a former chief executive of Marks & Spencer, said:

“This is a win-win for entrepreneurs and employers in small and medium-sized companies that need a flexible dedicated workforce focused on growth”.

Of course, it is important that existing employees are not coerced into this new employment status. That is why the clause adds a new unfair dismissal right and a right not to suffer a detriment if an existing employee turns down the offer of an employee shareholder contract.

The new status will have all the rights associated with employees, including discrimination rights, except for certain unfair dismissal rights, rights to statutory redundancy pay and certain statutory rights to request flexible working and time to train. Employee shareholders will be required to give 16 weeks’ notice of their intention to return from maternity, adoption or additional parental leave. Importantly, employee shareholders will be given shares in the company of at least £2,000, with the gains made on the first £50,000 of shares exempt from capital gains tax. This new employment status is about increasing choice and flexibility in the employment relationship.

This Bill brings together a range of measures that will simplify the planning system, boost investment in housing and infrastructure, and help businesses and growth. I commend it to the House.

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4.15 pm

Lord Adonis: My Lords, I thank the Minister for explaining the Bill. We look forward to working with her as we scrutinise it in detail. I am fortunate to be supported on the Front Bench by my noble friends Lord McKenzie of Luton and Lord Tunnicliffe.

The Bill does a few worthwhile things, including removing restrictions on the disposal of land for less than best consideration, some of the energy provisions and allowing the stopping up or diverting of highways and public paths to run alongside the planning process. However, the meat of the Bill is less appetising. Its unifying theme is not growth but weakening local government. That contradicts not only the coalition’s own previous policy of localism but the excellent report on growth by the noble Lord, Lord Heseltine. He condemned what he called the “drift to centralism” as an impediment to local economic regeneration and said that,

“as Whitehall has taken more powers so its distrust of local decision makers has increased. At the first sign of trouble, further powers are wrested back to the centre. At the same time—and I would say as a result—the involvement of local business people in the governance of their communities has dwindled, and their energy and innovation has been lost”.

Yet what does the Bill do but precisely what the noble Lord, Lord Heseltine, criticised? On the unsubstantiated claim that local authorities are not giving enough planning consents quickly enough, it wrests power back to the centre, authorising Ministers to suspend local planning authorities entirely for the first time since the modern planning system was established after the Second World War. It does this in the very first clause of the Bill, whose opening words are:

“A relevant application that would otherwise have to be made to the local planning authority may (if the applicant so chooses) be made instead to the Secretary of State”.

That is the antithesis of localism and the report by the noble Lord, Lord Heseltine.

The suspension of local democracy in the Bill is only supposed to be in cases of failure, but it is no surprise that the Government are finding it hard to define failure. When attempting to give the House of Commons a concrete example of a failing local planning authority, the Secretary of State, Eric Pickles, cited Hackney. He then had to correct this to Haringey, and apologised unreservedly to Hackney. No doubt the confusion was caused by Hackney and Haringey both beginning with the letters “Ha” and ending in “ey”. I hear that Mansfield and Macclesfield, not to mention Hertfordshire and Herefordshire, are eyeing each other warily and sending maps to CLG with their locations, spelling and other vital statistics clearly distinguished.

The criteria for failure are not set out in the Bill but are at ministerial discretion and are being consulted upon separately. When she replies, perhaps the noble Baroness could tell us how many local planning authorities would be liable for suspension under the latest draft of the criteria, as they keep changing, and which ones are liable for suspension.

I note that in respect of the speed of deciding major planning applications, which is one of the criteria for failure, the three slowest local authorities in the country are Kensington and Chelsea, Torbay and North Norfolk. I particularly look forward to the views of the noble Baroness on the competence of Kensington and Chelsea.

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On the national situation, in 2011-12, councils approved 87% of applications, which as the noble Baroness herself said is a 10-year high, with 82% decided within eight weeks and 93% decided within 13 weeks. This is not a plausible argument for failure and developers can already appeal to the Planning Inspectorate on grounds of non-determination in the required time under Section 78(2) of the Town and Country Planning Act 1990.

To be fair, I suspect that in her heart of hearts, as a distinguished former local authority leader, the noble Baroness does not actually want the power to suspend local planning authorities, but she has been told by the Chancellor that an example has to be made, in Admiral Byng fashion, of some supposedly obstructive councils, so she has got to find a few to shoot at dawn “pour encourager les autres”.

Localism and local government have strong supporters in all parts of the House, and I hope we can work constructively to get a better balance between local democracy and Whitehall control in this Bill. The same applies in respect of its other anti-local provisions. There is concern at the restrictions on the designation of village greens and town greens in Clauses 13 and 14. My right honourable friend Hilary Benn describes this as a “positively Kafkaesque” proposal, in that under the Bill the moment a planning application is published, citizens are banned from seeking to register a green. As he puts it:

“Since the first that most people will hear of an application is when it is published, this seems to be a pretty clever way of stopping people exercising their rights, unless they happen to be mind readers”.—[Official Report, Commons,5/12/12; col. 617.]

Also of concern are the wide powers to take planning applications away from local communities in Clause 24, which significantly extends the lists set out in the Planning Act 2008 by including business and commercial projects. Clause 8 overrides the requirement to preserve the beauty of national parks in the siting of masts and overhead cables, which appears entirely unrelated to the imperative to extend broadband, which the national parks strongly support. I welcome the assurances of the noble Baroness about that in her speech and I hope that they meet this point. I will study her words with care.

There is a good deal of concern about Clause 6, which sets aside affordable housing requirements through the Section 106 process. This appears to be another straightforward case of Treasury knee-jerkism. It is obviously vital that housing developments in areas of need are economically viable; but no case has been made that Section 106 is holding things back, whereas without Section 106 there is a real danger that fewer mixed communities will be created and there will be less affordable housing.

Asked about Section 106, the National Housing Federation said:

“No evidence has been provided to suggest that planning obligations are routinely stalling development."

The Council of Mortgage Lenders said:

“We are not convinced that Section 106 obligations are necessarily the key sticking point”.

When the planning Minister was asked by the Commons Select Committee, he could give no statistics on the number of developments being held up by Section 106 difficulties. He suggested that there were some 1,200

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sites and 75,000 homes being stalled, based on something called the Glenigan database. The noble Baroness has just referred to 1,400 sites rather than 1,200. These numbers clearly vary depending on the Minister.

When asked to publish the Glenigan database, the planning Minister said he could not do so because it was commercially sensitive. When asked the straight question of how many were stalled because of Section 106 requirements, he replied:

“It is very difficult to say”.

Perhaps the noble Baroness could tell us when she replies. If she cannot, surely Parliament should not be giving her the power to override local democracy on cause unseen. This is not a minor matter. Thousands of affordable homes are provided each year under Section 106 agreements. I should add that the Local Government Association estimates that 400,000 homes have planning permission but are yet to be built, which points to much wider economic factors at play than the planning system. So much for planning and local democracy.

The other critical concern about the Bill relates to Clause 27. This is the so-called shares-for-rights scheme. The House will recall the origins of this idea: Adrian Beecroft’s controversial plan to abolish employment rights in respect of unfair dismissal, even as the period of qualification for such rights was in many cases being doubled from one year to two years. The Business Secretary, Vince Cable, vetoed the original Beecroft plan, saying:

“Britain has already got a very flexible, cooperative labour force. We don’t need to scare the wits out of workers with threats to dismiss them. It’s completely the wrong approach”.

We on these Benches, and, I suspect, most of our friends on the Lib Dem Benches entirely agree with those sentiments.

The trouble is that Vince changed his mind, or had his mind changed for him. At the instigation of the Chancellor, the Beecroft proposal reappeared, tied to the allocation of shares, in Clause 27. Clause 27 is Beecroft by the back door. It creates so-called employee shareholders, who have been given shares worth between £2,000 and £50,000 on the day of issue, who will have no rights to statutory redundancy pay, no rights to request flexible working, no rights to request time off to train and no rights to claim unfair dismissal.

It is important to separate the issues of employment rights and wider share ownership in this regard. We strongly support wider share ownership among employees and many of the detailed and well considered proposals to that effect in the Nuttall report, published only six months ago. However, that is entirely different to trading shares for basic rights in what is generally an unequal employment relationship, which is the very reason why employment rights exist in the first place and why they have been built up by Governments of all parties for more than a century.

There is nothing well considered about this shares-for-rights plan. On the contrary, it makes the back of the envelope look like Magna Carta. The proposal was announced on 8 October. The consultation started on 18 October. It was completed on 9 November. All of that was happening while the House of Commons was approving the very plans supposedly being consulted

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on. The consultation demonstrated almost universal criticism and lack of support, but the Government proceeded anyway and, a mere two months later, your Lordships are now all that stand between the back of the envelope and the law of the land.

A host of critical issues about shares for rights was not addressed properly in the House of Commons and need to be addressed by your Lordships. First, what protection will there be against people being forced to take up no-rights jobs? As the noble Baroness just stated, in the Commons, the Government agreed to statutory protection in respect of existing employees, but what about new employees? In particular, what about those on benefits who stand to have their benefits withdrawn if they do not take up no-rights jobs? The employment Minister, Michael Fallon, only exacerbated those concerns in the House of Commons. He refused to accept a Lib Dem amendment to give protection to benefits claimants from having to take no-rights jobs. On the contrary, he said:

“The Government believe that jobseeker’s allowance claimants must actively seek and be available for work … it is right that employee-shareholder jobs should be as much a part of that consideration as any other”. —[Official Report, Commons, 17/12/12; col. 649.]

He said that, in such cases, the unemployed person should “normally accept the offer”. Let me stress that. In the view of the Government, jobseekers should normally accept jobs with no rights when offered. The only concession that the Minister made was that if some of the withdrawn rights were “appropriate”—for example, the right to request flexible working could well be crucial for a parent with young children—that could be taken into account in deciding whether benefits should be docked in cases where a no-rights job was declined. Michael Fallon went on to say that the DWP’s decision-makers’ guidance would be amended accordingly. Can I ask the noble Baroness if she will circulate the new DWP guidance before we consider this matter in Committee?

Far from meeting concerns about compulsion to accept no-rights jobs, the Government are parading compulsion as positively desirable. Paul Callaghan, a partner in the respected legal firm Taylor Wessing, said that these shares-for-rights contracts,

“will be optional to the extent that eating and drinking is optional”.

Secondly, in respect of employees facing redundancy or dismissal there is the obvious point that without existing rights those who are aggrieved will be encouraged to migrate to claims of discrimination, which are generally far more onerous and time-consuming when they come to tribunals. This is not just because discrimination claims will be the only avenue open to the aggrieved, having lost their other rights. To make another obvious point it will often be true that discrimination is involved since it is purely rational that an employer would seek to dismiss, or make redundant, first those who have no rights to compensation—in other words to discriminate against them unfairly.

Thirdly, what about tax avoidance? These shares-for-rights contracts will go up to £50,000 worth of shares, as the noble Baroness said. The Government say that they will get favourable tax treatment, although they still have not given the details. They expect us to pass Clause 27 into law without knowing what the precise

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tax treatment of these shares will be, unless the noble Baroness can enlighten us when she replies.

The Institute for Fiscal Studies describes Clause 27 as a “billion-pound lollipop” for tax avoiders which looks as if it will foster a whole new avoidance industry,

“just as government ministers are falling over themselves to condemn such behaviour”.

When she replies can the noble Baroness give me her estimate of the likely cost in lost tax revenue of these new employee shares?

In my entire time in Government and in the House I have never seen such unanimous opposition to a proposal from those whom it is intended to benefit, namely companies themselves. Justin King, the chief executive of Sainsbury’s, who was on the Prime Minister’s business advisory group, says that the policy is,

“not what we should be doing”.

He went on:

“What do you think the population at large will think of businesses that want to trade employment rights for money?

He continued:

“Our agenda ... should be making employing people easier and less costly”.

Only five of 219 consultation responses welcomed the proposal. The Law Society says that it will be likely to create more red tape not less. It will raise substantial risks of costly litigation and it will create serious potential claims of discrimination. The proposal is not even welcomed by the Employee Ownership Association, which says of Clause 27:

“There is no need to dilute the rights of workers in order to grow employee ownership”.

We have our work cut out on this Bill. Local democracy, affordable housing and the rights of employees at work are not small matters. They go to the heart of our society and our economy. Moreover, none of them is an impediment to growth. To get growth we need vibrant local leadership, more affordable housing, and self-confident, not fearful, companies and employees. Alas, this Bill weakens all three.

4.32 pm

Lord Tope: My Lords, I declare my interest as a councillor on a London borough council, which is also a local planning authority. I thank the Minister for the careful and thorough way in which she introduced the Bill. It sounded as if she might be choking on one or two statements that she made, but I think that is much more to do with the state of her throat than anything that is in the Bill.

Listening to the noble Lord, Lord Adonis, I was reminded, not for the first time in the past couple of years, of something that was said to me by a Conservative local government leader when I first became a councillor nearly 40 years ago. He said to me that there were really only two parties. As a Liberal I thought that I knew what was coming. In fact he said that they were the central government party and the local government party. The more we have these debates in your Lordships’ House on the Bills that come forward from a Government committed to localism, the more I am reminded of

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that Conservative councillor’s statement. In some of his comments, the noble Lord, Lord Adonis, also reminded me of it.

I take some comfort, though, from the way in which Ministers in the other place showed a willingness to listen to, and sometimes also to hear, reasonable arguments that were put to them and to agree to amend the Bill accordingly, or at least to provide welcome reassurances as to the Government’s intentions. I have no doubt that this listening and hearing approach will continue in this House, as it always does with the Minister, and I welcome again the constructive approach that the noble Lord, Lord Adonis, has promised us from the opposition Benches. I feel sure, therefore, that by the time we get to Third Reading we will be able to say positively that the Bill will do some good rather than that it will do little harm, which I fear is probably the reality at the moment.

I think that we all share at least some of the objectives of the Bill. For instance, we all wish to achieve sustainable growth and we all want more new homes, particularly affordable ones. We may start to differ on how and where to achieve these objectives, but the overall objectives are shared. At the least, therefore, we should start by welcoming a Bill that seeks to achieve them and commit ourselves to making it better able to do so.

Clause 1 of the Bill concerns the planning system. It seems to assume that the major inhibitor to growth is the planning system and local planning authorities generally. There is absolutely no evidence to support that contention. If we are to legislate for what I believe is such a draconian measure, were it to be implemented, then we need to have from the Government the evidence that tells us that it is necessary. I do not believe that that evidence is there. Indeed, Ministers have implicitly accepted that by saying that they expect, as well as that they hope, that these provisions will never actually be used. That is all very well when we have such a benevolent Government and a Secretary of State so demonstratively well disposed to local government, but when this is set in legislation it is there for all time, and it is conceivable that one day there may be a Government and a Secretary of State who are less benevolently disposed and are able to use these provisions in a less constructive way. We need to be aware of that.

I understand very well why no Government would want to set the criteria for designation in primary legislation; they need to be flexible and to be able to respond to changing circumstances. However, I hope that the Government will understand that others, local planning authorities in particular, need to see some safeguards in the criteria to be used for designation—if that is to happen—for the future when that less benevolent Secretary of State may be in office.

I hope, though, that we will look not only at what is in the Bill that could be improved or even removed, but at what is not yet in the Bill that could make a significant improvement in achieving its objectives. To me, the most obvious absence is the biggest cause of the failure of growth, particularly in the housing sector. I refer to access to finance, whether for SMEs or, more particularly in this context, for purchasers. For instance, between 2007 and 2011 gross mortgage lending dropped

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by 61%, the number of mortgages fell by 50% and the average deposit for a first-time buyer doubled. The Bill does little or nothing to address this issue. I hope that we will be able to address that important omission before the Bill leaves this House.

There are some interesting proposals from the Community Investment Coalition that seek to achieve this and which fit very well with a localist agenda. The CIC argues, and I agree, that to deliver a real impact the Bill needs to focus on providing local areas with the tools to hold financial services providers to account in order to improve access to credit on fair terms for both households and businesses.

I turn to some of the other provisions of the Bill, starting again with Clause 1, on which I am sure we will spend much time in Committee. On first reading it is hard to understand how this could have come from a Government who only a year or so ago promoted a Localism Act. In the other place, as I said previously, Ministers have gone to considerable lengths to put this proposal into a more welcome, or at least less unwelcome, context and to stress that they expect it to be rarely, if ever, used. Indeed, I would expect that any sensible developer would never want to use it, except in the most extreme circumstances.

One of the many failings is that it seems to put speed before quality—speed of decision-making before the quality of the decisions being made and the decision-making process. I know we will discuss more fully how we are going to balance that. Most of us would agree that we need both—a fast but above all a good quality decision-making process. I look forward to the answer to the question from the noble Lord, Lord Adonis, on how many local planning authorities will be caught under the current proposed criteria. My understanding is that it is none at all. If that is the case I wonder why Clause 1 of the Bill is thought to be necessary.

Times have moved on considerably. These days most local planning authorities understand the needs of developers. They understand that developers need to make their schemes financially viable and developers understand the role of the local planning authority, not least in representing the interests of its local community. Of course there are conflicts and frustrations in reconciling these interests—there are hard negotiations and so there should be—but most of that is done before the planning application is ever submitted. Certainly that is the case if it is done properly. I hope we will all recognise that, as so often, we are legislating to deal with a small minority of the worst, rather than any representation of the norm, and that, as usual, we are doing nothing to reward excellence or to help the best to be better.

Of course, we accept that some planning authorities are not doing as well as they could or should. I know that the Minister—who I know well as a fellow former London borough council leader—will readily agree with me that designation must really be a very last resort and that a far better approach would be to provide help and support to enable those authorities to improve themselves. Perhaps she will say a little bit about the Government’s intentions in this regard. For instance, how much warning will the Government give

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that a local planning authority is on the danger list, and will that be sufficient to enable it to improve itself and to seek help from its peers to be able to do so?

Finally, on Clause 1, the Mayor of London is proposing that if any London local planning authority is designated the mayor rather than the Planning Inspectorate should be able to call in and consider appropriate planning applications. I have made clear my concerns about designation, but I can see some merit in that power going to an elected and accountable body that will at least have some knowledge and experience of local circumstances. I am sure we will consider that further in Committee.

I turn now to Clause 6, reflecting the modification or discharge of affordable housing requirements in Section 106 agreements. Again, we must recognise that the norm is that this happens already. All over the country local authorities are renegotiating Section 106 agreements with developers. It does not need legislation or friendly advice from a benevolent central government to enable that to happen. Of course those negotiations are hard. The developer, quite rightly, wants to get the best financial return and the local planning authority, equally rightly, wants the best for the local community, particularly with respect to much-needed affordable housing. Those negotiations take place. They are sometimes difficult and protracted but more often than not agreement is reached. Again, the Minister has said that some local authorities refuse to negotiate. I hope she can quantify that even if she does not wish—or is not even able—to name them now. The Local Government Association in its survey said that only 2% of local authorities are unwilling to negotiate. Before we legislate for that 2% we need to understand better whether that is just because they are very difficult and very awkward or whether there is some local reason or circumstance in a particular Section 106 agreement that brings that about.

It is very important that this provision is not seen either as any real or implied reduction in the Government’s commitment to the provision of more affordable housing, nor as an easy get-out clause for reluctant developers. We must also be assured that the Planning Inspectorate, if it is to be the arbiter, will be equipped for the task being given to it—although I question whether this is the most effective use of scarce resources. Again, I am sure that we will spend some time on this in Committee when we will be seeking reassurance and safeguards on these points. Again, we may wish to consider whether the Mayor of London has some role in this, as at least an elected and accountable body as distinct from an unelected and unaccountable one based some distance from many local authorities.

My colleagues speaking from the Liberal Democrat Benches in this debate will raise other concerns about the Bill. In particular, my noble friend Lady Brinton will speak about those provisions relating to rural broadband and to employee ownership. I will leave that to her. I have just two further short questions for the Minister. Clause 24 would bring business and commercial projects within the Planning Act 2008 regime. Although I understand that this does not include retail or housing projects, can the Minister say how

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and by whom such projects will be defined as being of national significance, and what additional power this clause gives that does not already exist?

My final point concerns Clause 25 and the postponement of the business rate revaluation. The Minister has told us how many potential losers—I suppose we could call them that—there would be under such a revaluation. I wonder how many winners there might be. Presumably it is a lesser number, which is one of the reasons why we are doing this. In any revaluation, some are losers and some are winners; there is a balance in that. I also wonder whether the Minister can tell us what effect, if any, this will have on the localisation of the business rate that starts shortly.

I end as I began by saying that on these Benches we will work constructively with all sides of the House to try to make this Bill even better so that it meets the objectives which are stated in its title, and which we all share.

4.47 pm

Baroness Valentine: I declare that I am chief executive of London First, a not-for-profit membership organisation that seeks to make London the best city in the world in which to do business. I am also a board member of Peabody housing trust. Wearing both hats, I have a strong interest in the efficacy of the planning system.

Too often, planning is seen by both those seeking approval for schemes and those charged with considering them as a confrontational process, in which one side wins and the other loses. This ignores the fact that good-quality new developments benefit both the developer and the local economy. As investment in infrastructure is a key to economic growth, I am also keen to see a constructive approach being taken to other areas such as utilities, on which I will touch later.

In forming my views on the Bill I had useful conversations with the Department for Communities and Local Government, with the Greater London Authority and with local authorities, as well as with developers and utilities. From those discussions, it is clear to me that the Bill contains some very welcome measures. In particular, I welcome the proposals that enable the Planning Inspectorate to step in where the local authority has a track record of consistently poor performance in the speed or quality of its decisions.

In London, of course, the mayor has a specific responsibility for strategic planning, supported by a well respected team with established relationships with all relevant stakeholders. It seems that, as the noble Lord, Lord Tope, suggested, it would make sense for London referrals to be made to the Greater London Authority, allowing the Planning Inspectorate to focus on areas of the country without such arrangements. This would surely be in keeping with the spirit of the localism agenda. However, no matter where it is used, this is a significant power, so we should be careful about how we designate an authority as “poorly performing”.

In its consultation on the relevant criteria, the DCLG suggests a focus on the speed with which decisions are taken on major planning applications and the proportion of decisions that are subsequently

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overturned on appeal. These are important metrics but they miss two further sources of delay: on minor applications and on the discharge of planning conditions. Minor applications such as changing the frontage of a small shop may appear to be relatively trivial, but the cumulative economic impact of delays can be significant. The risk is that short-staffed local authorities will prioritise major applications at the expense of processing minor ones. That, surely, cannot be the Government’s intention. Likewise, there is no point in having a speedy resolution of the planning application if it is followed by procrastination over the discharging of planning conditions. I urge the Government seriously to consider these two important further metrics.

I now turn to the difficult economic climate in which development has taken place over the past few years. There is often a considerable delay between an application being approved and the first shovel in the earth, during which time market circumstances can change. In such instances, local authorities have the ability to modify Section 106 agreements in order to make sure that the development they want goes ahead. However, a recent Local Government Association survey has shown that only one-third of respondents did so over the past two years, despite the deterioration in the economic climate. This lack of action has led to the stalling of perfectly good schemes, which have taken affordable housing and other amenities with them and have also contributed to the dire situation in the construction industry. I therefore welcome the provisions in the Bill which recognise the need for planning to take more account of changing market conditions and which allow for the renegotiation of planning requirements to make schemes viable.

In London I would advocate the mayor having the power to call in major schemes where the local authority has been notified of a Section 106 modification. This would ensure that London’s strategic needs are taken into account while maintaining democratic accountability in the capital, consistent with localism. Similarly, the Government need to ensure that the cumulative burden of the various levies that planning authorities can impose do not prevent development. This is a particular issue around the new Community Infrastructure Levy in London, because both the mayor and the boroughs can impose their own separate charge. A safeguard is needed so that this double-dipping does not stop growth. The mayor has proposed that he should have the power to ensure that any proposed borough levy is consistent with the growth objectives in the London Plan. I would support such a measure. This power should apply to planning applications not only for buildings but also for other strategic infrastructure such as power supplies. I urge the Government to include energy infrastructure on the list of new developments that should be referred to the mayor where they are of strategic importance to London as a whole, rather than to only one borough.

Unblocking planning obstacles is, however, only part of the equation. A recurrent concern is that energy infrastructure struggles to keep up with demand. For example, as Land Securities Group has found in its major development around Victoria station, developers often find that connecting new buildings to the grid is expensive and slow because existing infrastructure is

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already operating at capacity. At the root of this problem is a regulatory framework that discourages the distribution company from investing ahead of need. Imagine if every time you bought an electrical item you had to wait for a new power socket to be installed at home before you could use it. In effect, this is the problem that developers face. The difficulty of getting connected to the power supply is considered by many to be one of the top three risks when bringing forward schemes. The regulator, Ofgem, should address this, so that the distribution company can build more infrastructure in areas of intense business activity such as central London, in anticipation of high demand. This way, new development would be able to “plug in and play” rather than suffer sometimes years of delay.

Staying with infrastructure, I welcome Clause 8, which is intended to support the rollout of high-speed fibre broadband. In the 21st century, provision of broadband is as vital as access to water and power for both businesses and homes. It is good to see that such things are recognised as essential infrastructure and that their contribution to growth is acknowledged.

Finally, I will recommend a structural change that would cost the Government nothing but which could have an enormous impact on the efficiency of the planning process: that is, giving local authorities the freedom to charge businesses the real costs of considering planning applications. At the moment, local authorities charge fees according to a government schedule rather than to the costs they incur. This means that at times of acute financial stress, authorities cut their planning resources. This is one major reason why some authorities are poor performers. Poor and variable advice from inexperienced officers can add substantial delays and costs. Most developers would prefer fees to be structured in a way that guarantees clear and consistent guidance rather than suffer the greater cost of a poor process. We should allow more flexibility to provide authorities with the resources commensurate with the task at hand.

In conclusion, I commented earlier that investment in infrastructure was a contributor to growth. In naming this the Growth and Infrastructure Bill, rather than the other way around, the Government might be accused of putting the titular cart before the horse—but I can live with that if the outcome is a thoughtfully integrated approach to planning that enables the two objectives to be met. I believe that the amendments that I suggested would support such an approach and help give the planning process a key role in delivering economic recovery, rather than being a bureaucratic and inflexible brake. I urge the Government to consider them.

4.55 pm

Lord Monks: My Lords, this Bill has an ambitious title. To the new reader, coming to it fresh, the title might give the impression that it has ambitious contents; that it is on the verge of giving effect to the Heseltine large-scale urgent initiatives call, which he made so well recently in this House on the basis of his report; that there would be a call for a renaissance of municipal values in the spirit of Joe Chamberlain and other Victorian civic leaders; and perhaps that there would be evangelising for employee share-ownership, and worker

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engagement and involvement, on a significant scale to shake up British boardrooms and to change some of the bad habits that exist.

However, if one looks at the Bill, frankly, there is none of that. As my noble friend Lord Adonis pointed out, there are no echoes of the impressive Heseltine report and no big ideas reflecting the way in which he approached the problems of growth and infrastructure. Instead, the two most prominent measures are to cut local authority planning powers—unfairly, in my view, blaming them for blocking growth—and to threaten workers’ rights with an implausible proposal to trade shares for rights. In my view, the Bill rather offends the Trade Descriptions Act. The Prime Minister is rather keen on the Ronseal advert, is he not? But the Bill does not do what it says on the tin.

I will leave others to deal with the local government aspects. The noble Lord, Lord Tope, has made an effective start on chipping away at that pillar of the Bill. I shall concentrate my fire on shares for rights and what that might mean. First, I find it unethical that you can trade a statutory right for something in your contract in that way. Perhaps the Minister would tell us whether there is a precedent for this in British law; namely, that having a right is somehow a bargaining chip and something that you can buy and sell. I believe that it must be dismissed as a serious attempt to develop employee ownership: it is more a trashing of workers’ rights. From the list that the Minister read out, if this legislation goes through, the proposals that will have the biggest effect are those relating to redundancy. I shall draw attention to that point.

However, the objections generally are many and various. First, is this proposal really optional? Clearly, it will not be optional for new starters. If an employer says, “There is a job here and it has the status of an employee shareholder—take it or leave it”, the individual will have to operate within that framework. For the existing employee—clearly, I recognise what has been done in the other place about the new unfair dismissal right—there will still be plenty of scope for pressure to be applied to individuals, short of dismissal, to fit in with the employee-shareholder concept. I do not think that any employer, even the few who would be interested in this provision, will be particularly comfortable with having two categories of worker—those who are employee shareholders and others who are regular, standard employees. I shall come to one of the problems that that might create for an employer.

There are questions about how the shares would be valued. When would entitlements become due? Do you lose statutory rights under employment law the minute that you sign the contract? When do you get the money? When do you get rights to the shares? When does the £2,000 kick in? The share side of the equation is fuzzy and there is a lot of scope for the employer. The loss of rights, on the other hand, is absolutely crystal clear. How do you redeem the shares and what do you get from them? Does the employer decide? In the debate in the other place, the Minister said that it could be left to the good sense of the employer and the employee to work out something that is acceptable. As my noble friend Lord Adonis

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said, that is not an equal relationship, particularly if someone tries to cash in their shares when the company is in some difficulty.

Do the shares confer any rights such as full voting rights and representation in the boardroom, which are common in employee-ownership companies? Let us be clear: around 50% of new firms in this country fold within five years. Is there not a danger that an employee shareholder will find himself or herself with no right to redundancy pay and a bunch of worthless shares? In those circumstances, he or she will be more vulnerable than the standard employee, who will be entitled to redundancy pay. The employee shareholder will possibly be entitled to absolutely nothing. The employer will find it cheaper to get shot of employee shareholders. I believe that most employers will not touch this provision with a bargepole.

The Front Benches in this debate have mentioned different employers’ opinions and I will not repeat them. Those employers who have been critical and have damned the proposals with the faintest of faint praise make up by far the majority. It is not as though employee rights are extensive in this country. Only the United States and Canada offer less protection for the individual employee. The OECD ranks us third in having the most “flexible” labour market, whereby workers can be dismissed most easily. Let us also be clear that rights are being whittled down in other legislation that is before the House, has recently been carried through or is proposed—the latest being a consultation on reduction of the redundancy period. The Enterprise and Regulatory Reform Bill is being considered in Committee tomorrow and will already curb employee rights.

I guess, however, that although most employers will not touch the proposals, some will—not least to explore some of the tax advantages that might apply and to do so in a way that will seek to minimise any real dilution of ownership from their embracing and welcoming groups of employees. If you are going to do employee ownership, the lesson that we have learnt over the years is that it is the companies that really believe in it and want it that make a success of it. The John Lewis approach does not come through coercion or taking rights away from individuals who might at some stage need them.

Employers who go down this particular route should be warned that the processes will be complex. For example, as regards maternity rights, one will need to check exactly who is a parent, how many children they have and all the rest of it. I was talking to my wife about this and we agreed that we are in the market to sell our parental rights, having long since disposed of any further use for them, and many Members of this House would be in the same position. With any powers of reflection, employers would also need to look at their own reputation and that of their brand, which would be at risk if they went down this route. I believe that the scheme will be a lot more trouble to them than it is worth.

I say to those Liberal Democrats who rightly criticised the Beecroft no-fault provisions that this, as my noble friend Lord Adonis said, is a different way of introducing

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no-fault dismissal. However, I go a little further: it is no-fault dismissal with no compensation. At least Mr Beecroft proposed some compensation and did not go as far as this provision.

In May, the Deputy Prime Minister launched the Nuttall report on employee ownership. In our view, it proposed a sensible way forward and did not include this turkey that we are debating today. So the Government are not entitled to claim the support of Nuttall. The noble Baroness did not do so today, but others certainly have.

I very much hope—it may be a vain hope—that the Government will reflect on the Bill and be prepared to put it to one side to await the response to the Heseltine report. The reports more or less call for the same things and the Bill pollutes the terrain over which the Heseltine exercise ranged so impressively. This messy, ill judged Bill, with a misleading, grandiose title, is not the way to start and not the way to organise a proper response to a serious piece of work. In the spirit of “all being in it together”, one nationism or whatever, in all corners of this House, it would be very wise to wait for the government response to an initiative which is, at present, attracting wide support from all quarters, and which will get behind genuinely ambitious proposals on growth and infrastructure, rather than taking this unworthy route of trashing workers’ rights.

5.06 pm

Baroness Brinton: My Lords, as my colleague and noble friend Lord Tope said, I shall speak principally to Clauses 8 and 27. I want to focus on the importance of rural growth and not just on the issue that I know concerns some people: of large telephone masts going up in areas of outstanding natural beauty. I am grateful to the Minister for making it clear that the Bill excludes that. I start by declaring a past interest. I helped St John’s College, Cambridge to set up its innovation park in north Cambridge 20 years ago and I was a director of the St John’s Innovation Centre until 2010, working with entrepreneurs as they spun ideas out of Cambridge University. I was also deputy chair of the East of England Development Agency until 2005.

The Cambridge phenomenon spread out from Cambridge’s central areas 100 years ago when engineering support companies such as Cambridge Instruments set up in Milton, one of the necklace villages, to provide instruments and other essential products and telemetry for the Cavendish Laboratory and the engineering department to start to use. The phenomenon I shall talk about is not just one of the most recent 10 or 20 years of high-tech growth. Sixty years ago, Trinity College built the first science park on green land, housing some of the new era of spin-outs from the university, including Cambridge Consultants and many others.

Since then, spin-outs and sons and daughters of spin-outs have set up further and further away from the centre of Cambridge because a small medieval city cannot cope with large industrial growth in its centre. In the late 1980s, it became clear that the area around Cambridge was struggling with the problems of rapid growth, including rapid increases in commercial and residential property prices, shortages of qualified staff to work in the area and an infrastructure struggling to

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cope with a large influx of new residents who needed schools and other services. Some of the new small companies decided to move further out into the fens. Did noble Lords know that, in the 1990s, Ely was a hot spot for high-tech veterinary research products? Software companies have moved further out to places such as Chatteris. While perhaps one does not think of a fen village or town in that way, these companies have done it because they needed lower costs in order to recruit staff and, frankly, to house them.

As IT connections have become more important the lack of broadband—let alone high-speed broadband —has become a serious issue for companies in rural areas. In the past it was not used universally but now all businesses rely on broadband for their effective running, even those we think of as being low-tech. Some friends of mine run a pig farm out on the Norfolk fens; even they use computers and broadband for communications, orders, correspondence and results from veterinary testing—and for access to government advice, which can often be accessed only via the internet now. All of this is done via the superhighway. There has been a serious market failure in providing high-speed broadband in rural areas. Businesses in the fens of Cambridgeshire and Norfolk and in the Suffolk coastal areas all suffer from the lack of this fundamental tool that urban and suburban organisations take for granted, even if it is not as fast as they want.

Clause 8 opens the door to removing the first hurdle faced by broadband suppliers by easing the planning regulations. However, as I have mentioned, it sensibly insists on taking account of areas of natural beauty, and I am grateful to the Minister for making it absolutely clear that Clause 8 will not mean easy access for telephone companies to put masts up everywhere. However, I should say that even I missed a mast in Norfolk which I realised later was actually a very tall Scots pine; they can be quite discreet.

Growth in our economy is vital to the future of UK plc; it is not just a city issue and therefore cannot be restricted to city and urban areas. However, all Governments tend to focus on urban areas. I believe that our rural areas will be key to sustaining and revitalising our villages and the countryside around them, as well as providing real income for the country.

I move on to Clause 27 on employee shareholders. The more conversations I have with Ministers and others about this clause, the more bemused I become. First, let us look at the general principles behind it: certain companies will want to offer ownership to employees in return for those employees giving up some or perhaps all their employment rights. These include redundancy pay, rights to training or flexible working, and parental leave. Three members of my immediate family are already employee owners: one in the food retail sector and two in high-tech leading-edge companies, one of whom has had his shares for more than 30 years. When discussing this clause with them and with senior and junior staff in a number of other companies, it emerged that every single person, from directors and managers to new recruits, said that a reduction in employment rights absolutely counteracts the benefits of owning shares because it demotivates the staff. Even senior directors have said this.

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The Government argue that not all companies will want to use this mechanism and claim that small, often start-up high-tech companies are the likely beneficiaries. These are exactly the companies I have been talking to. My own experience in small high-tech businesses in the east of England and Cambridge, and my discussions with the owners of those firms, show the exact opposite. They know that they have to motivate their staff first. That is vital in the early days as specialist companies face product development costs with no sales and often have anxious funders looking over their shoulders. They are worried enough about the future of their organisations.

Let us take another illustration, that of a firm that has been going reasonably well in Cambridge for some time and in which virtually all the staff hold shares. It hit problems during the recession before this one. There was a staff discussion about how to help their company through those tough times, and the staff gave the company a series of loans over the two to three-year period it took to keep it going. Some of the staff in that organisation have said that if the company had taken away their rights, there would have been no motivation for them to say, “We want to save this company”. That is an example of good entrepreneurial spirit—a company where managers and staff work together.

I have two outstanding queries about this clause, one of which has already been alluded to by the noble Lord, Lord Adonis, and raised by my honourable friend Andrew Stunell in another place. It concerns the whole issue of a JSA recipient being offered a job with reduced rights in return for shares when entering a company. It cannot be right to penalise an individual who chooses not to take a job with reduced rights. I know enough people who have been made redundant from one, two or even more jobs who go into something asking, “Why would I give up any of the few remaining rights that I have?”. I want the DWP guidance to be absolutely explicit and statutory. If we do not get that guidance before Committee, I may well table an amendment to ensure that we see something.

I am also concerned about the information that employees will have about the size and nature of their shareholding. They must have access to independent legal advice, which should be paid for by the company and should set out clearly the likely path. Shares do not just go up and down; they are often diluted out of sight in rounds two and three of funding. Employees need to understand that they are taking a substantial risk not just in giving up rights but by having shares at all. Sadly, not all our companies succeed; they certainly do not always see growth. Of those that do, employees often find that a shareholding that looked quite attractive at even 1% in the early days is very small by the time the company is worth anything realistic at all.

Overall, my view is that this clause will not be used. All the consultation responses that I hear say that it will wither on the vine, but the two items that I have outlined will, I believe, provide some protection and cover some of the points that the noble Lords, Lord Monks and Lord Adonis, made about rogue employers trying to use it. I, too, support the Nuttall report and the Deputy Prime Minister’s promotion of it earlier.

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I believe that it is a more effective way forward by giving employees the right, which my party has long believed in, to share in the benefits of growth of the company. Any company that grows helps UK plc, and is that not what we are all here for?

5.16 pm

Baroness Whitaker: My Lords, I shall focus mainly on two areas of this disparate Bill: those dealing with affordable housing and the preservation of our national landscape. Outside those, my noble friends Lord Adonis and Lord Monks, and the noble Baroness, Lady Brinton, have spoken eloquently about the folly and injustice of enabling businesses to buy the rights of their workpeople, which will have a particular impact on the position of women. To subordinate rights to a contract is a backward step indeed and I hope that there will be amendments to redress this.

Turning to my main concerns, the Bill’s provisions for renegotiating the proportion of affordable housing agreed under Section 106 of the Town and Country Planning Act 1990 are also a real step back from the excellent achievement of mixed housing developments, of which I have seen many successful examples. They spell ruin for the encouragement of sufficient, much needed new housing for the countless hardworking people whose pay does not cover market prices. Will the Minister say how enough new houses for people who are not rich can be assured? Of course, we desperately need growth and investment in infrastructure, but this Bill does not address the key issue in housing development, which is, of course, the bellwether of increased growth. The fact is that people cannot afford to buy and banks will not lend. House prices are rising at three times the rate of wages.

The Homes and Communities Agency wrote to my honourable friend Clive Betts MP, chair of the Communities and Local Government Committee, to say that it was,

“not aware of any current issues relating to section 106 agreement on the very small number due to start on site this … year”.

I reiterate my noble friend’s question to the Minister: how many of the Government’s claimed hundreds of thousands of stalled sites have Section 106 as the cause? Certainly, another cause seems to be the reluctance of local communities to accept more housing. Here I can do no better than to quote Liberal Democrat councillor Adrian Dobinson, who in a letter in last Friday’s Guardian said that,

“people will allow modern housing ... if building design of our age is considered building design as good as the period buildings found in villages, instead of awful little boxes demanded by planners and weak-kneed architects unprepared to stand up to them”.

What can the Government do about that?

I turn to the landscape. The powers in Clause 8 which seek to remove essential protection for our national parks are aimed at speeding up the introduction of faster broadband, facilitating tall poles, cabinets and overhead lines, as the Minister explained. A very large number of serious and representative organisations have asked us to remove this provision. I declare an interest as president of the South Downs Society, the co-ordinating NGO for that area.

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The introduction of faster broadband for the countryside is very important, and I fully understand the points made by the noble Baroness, Lady Brinton, but it is absolutely not necessary to do this at the expense of the potential desecration of our most cherished landscapes. The limited time allowed in the Bill for getting new structures up will be a further disincentive to a careful process for managing our irreplaceable beautiful landscapes. I am not aware of any evidence that it is the planning process in protected landscapes which is holding back the advance of broadband. Will the Minister please give the House examples, if any exist, in the national parks? As it happens, the national parks authorities are already active in ensuring that the relevant infrastructure is installed in a way which minimises visual impact. I could cite Northumberland, the Peak District, Exmoor, my own South Downs and many others.

It is of course quite true that there have been delays in rolling out superfast broadband in our countryside, but not because of the planning system. Receiving state aid clearance from the European Union was the main culprit: £530 million of expenditure on broadband has only just been approved, covering perhaps half of the local broadband plans, which would enable 90% of the people in the UK to access superfast broadband. Does the noble Baroness agree?

These provisions go against paragraph 115 of the Government’s own National Planning Policy Framework and defy the intention of the great National Parks and Access to the Countryside Act 1949: to conserve and enhance our most important landscapes. I am sure the noble Baroness does not want to play any part in imperilling our natural heritage, which is already so vulnerable, or deprive future generations of the immeasurable benefits of the national parks’ beauty. I look forward to her response.

5.22 pm

Baroness Eaton: My Lords, I begin by declaring an interest as a vice-president of the Local Government Association. I have also represented the council ward of Bingley Rural in West Yorkshire since 1986. I rise to speak with some unease, since I take no real pleasure in criticising any government legislation. I am a strong supporter of the coalition’s endeavours to correct our economic situation and return us to a safe financial footing, and I firmly believe that the Government are making great strides in that direction. However, sadly, I see this legislation as a step in the wrong direction, which will not deliver its main objective of widespread economic growth but rather move us dangerously on a narrow winding path away from the golden road of localism down which we have, to date, made much progress.