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City Regulation
9. Mr. Purchase: To ask the Chancellor of the Exchequer what representations he has received about his proposed reforms to City regulation. [1594]
Mr. Darling: My right hon. Friend the Chancellor's announcement regarding reforming the regulatory system has been widely welcomed. It was the result of some four years' work and wide consultation. I am pleased to report that work is well in hand to take the Government's plans forward.
Mr. Purchase: Does my right hon. Friend agree that we should condemn the previous dilatory authority that allowed Andrew Regan to be considered a fit person to run a bank, when only a few days later he was condemned by a High Court judge as being unfit and "clearly dishonest" in his dealings with the Co-operative Wholesale Society? Does my right hon. Friend further agree that it is time that there was a new authority that will ensure that people who want to run their businesses properly and decently can do so free from the influence of crooks?
Mr. Darling: My hon. Friend will appreciate that it would be inappropriate for me to comment on the case of Andrew Regan, as I believe that it is now sub judice. On his general point, for many years there has been concern that the regulatory system has not been capable of cleaning up those parts of the industry that needed to be cleaned up. People who were guilty of quite serious misdemeanours--which reflected badly on the industry as a whole--were not properly dealt with.
Part of the objective in streamlining the structure and the nature of the regulatory system is to ensure that, where there are problems--for example, insider dealing--they can be dealt with quickly and effectively. That is why our proposals have been widely welcomed. For years, people could not understand why the Conservative Government would not act to clean up the City. The vast majority of people in the City are honest and their integrity is beyond reproach. It was they, as much as anyone else, who wanted action to be taken. Once again, this is an example of the Labour Government acting in an area where the Conservative Government did nothing for 18 years.
Departmental Expenditure
11. Mr. Simon Hughes: To ask the Chancellor of the Exchequer when he will next announce changes to departmental public expenditure totals. [1596]
Mr. Darling: I explained to the House yesterday our policy regarding the comprehensive spending review. I also explained that, during the general election campaign and since, we have made it clear that Departments are expected to work within their departmental totals.
Mr. Hughes: Following yesterday's statement, I want to ask a question for the purpose of absolute clarification. If, for example, the Social Security Department and the Minister for Welfare Reform find savings in the social security budget and the Government bring down the social security bill between now and April of the year after next--as everybody hopes that they will--and if, in the
same period, the demand for the health service rises and the obvious cost of running the service is more than the figure that the Tory Government set--a figure to which the Labour Government are adhering--will there be any chance of money being transferred from a reduced social security demand to a clearly increased demand for the health service?
Mr. Darling: Unlike the Liberal party, this party and this Government have been very clear that, before we allocate and spend money, we must know where it will come from. The whole purpose of the comprehensive spending review process, which is now under way, is that my right hon. Friends examine their budgets and determine how they can be better spent. As I explained yesterday, we have already started the process in the health service and in education, and we intend to continue the process.
Mr. Canavan: If the Barnett formula is to be reviewed, will the Chief Secretary assure the House that any amended formula will ensure that public expenditure is distributed to the different parts of the United Kingdom on the basis not only of population but of genuine need, and that any additional revenue raised by the Scottish Parliament will be available for additional expenditure within Scotland?
Mr. Darling: As I told my hon. Friend the Member for Linlithgow (Mr. Dalyell) yesterday, the Government will make our proposals on funding the Scottish Parliament in a White Paper, which will be published in time for the referendum campaign and the referendum itself. We have always made it clear that it is important that all parts of the United Kingdom should be funded on the basis of need and in an acceptable manner. That is our intention, and there are no difficulties about it. My hon. Friend the Member for Falkirk, West (Mr. Canavan) will see our proposals in the White Paper, and I am sure that he will think that they are very satisfactory.
Sir Norman Fowler: In spite of that review, will the Chief Secretary confirm that the current arrangements for exemptions from paying prescription charges will remain unchanged?
Mr. Darling: I am interested in the right hon. Gentleman's sympathy for those in need, because the House will remember the review that he conducted in the 1980s. I made it absolutely clear yesterday that all aspects of Government expenditure must be reviewed; there is no question about that. As he will well know, to exclude any part of expenditure would mean that the review cannot be effective. Conservative Members should remember that, unlike them, the Labour party is committed not only to the principles underpinning the national health service but to fairness--which is something that the Conservative party cannot even begin to understand.
Mr. Tipping: Will the Chief Secretary ensure that any review of departmental spending is collective and that there is a careful analysis of issues that are dealt with by more than one Department? If he does so, will there not be a real opportunity of ensuring that hard issues--such
as poverty, adding value to people and helping communities to aspire to a new future--have a chance of being successfully addressed?
Mr. Darling: My hon. Friend is quite right. It is absolutely essential that the Government examine the entire range of services, not least health services, for which we are responsible. There is, for example, a relationship between poverty and health and between quality of primary care and subsequent need for hospital acute care. I can assure my hon. Friend not only that will there be reviews across Departments but that the entire process will be reviewed by the Public Expenditure Committee. I am sure that he will be pleased to know that my right hon. Friend the Chancellor and I will supervise that process.
Special Advisers
13. Mr. Colvin: To ask the Chancellor of the Exchequer if he will make a statement on his policy on the appointment of special advisers to Her Majesty's Treasury. [1598]
The Economic Secretary to the Treasury (Mrs. Helen Liddell): The Government's policy on the appointment of special advisers was agreed by the Prime Minister, on 19 May, in the attachment to his letter to Cabinet colleagues. A copy of that letter has been placed in the Library of the House.
Mr. Colvin: I thank the hon. Lady for that reply. Will she acknowledge two matters that should make the Chancellor's job rather easier? First, he has inherited a booming economy from the outgoing Conservative Government. Secondly, he has relinquished one of his principal responsibilities--deciding monetary policy--to the Bank of England. Why is it therefore necessary for him to increase the number of his special advisers by one third?
Mrs. Liddell: I am grateful to the hon. Gentleman for raising that point, because the reality is that we have found UK public expenditure to be a mess. The state of public expenditure prompted yesterday's announcement by my right hon. Friend the Chief Secretary. Moreover, I detect a whiff of hypocrisy in the position adopted by Conservative Members on special advisers. Since 1974, special advisers have been serving well the United Kingdom and Governments from both parties.
As for changes in monetary policy, the Chancellor of the Exchequer, in his statement of 20 May, made it quite clear that changes in setting the inflation level are related to achieving the Government's other targets--to ensure that we have the right parameters, a stable economy, economic growth and fairness. Ensuring that we have a Government who govern for the many and not for the few is our priority.
Mr. Clapham:
Will the my hon. Friend the Minister ensure that the special advisers to the Treasury read the study recently completed by Sheffield university's energy study group, which shows that there is a need for a change in the tax regime in the United Kingdom continental shelf? The study also shows that had we, for example, been matching the Norwegian system, the revenue
Madam Speaker:
Order. The hon. Gentleman is miles off the point. We are dealing with the appointment of special advisers. I believe that Mr. Radice wished to ask a question.
Mr. Radice:
Does my hon. Friend agree that it is sheer humbug to talk about politicising the civil service when a few additional special advisers are appointed and when in fact it was Mrs. Thatcher, when she was at No. 10, who suborned the integrity of career civil servants by making them her political playthings--so much so that they were not accepted back into the civil service?
Mrs. Liddell:
I am grateful to my hon. Friend for making that point, because there is clear evidence of humbug among the Opposition. Indeed, I well recall that, under the previous Government, it took the intervention of the Cabinet Secretary to ensure that the then Secretary of State for Scotland did not use the Government press office to disseminate Conservative party propaganda. The appointment of special advisers is specifically to guarantee that the civil service does not become involved in party political issues.
Mr. Green:
The hon. Lady talks about humbug in relation to the politicisation of the civil service. Will she comment on reports that the Prime Minister has offered Mrs. Rachel Lomax, a career civil servant, the job of a special adviser as head of his policy unit? Will she further comment on the fact that the lady concerned, who is an intelligent civil servant, has very sensibly turned down the job because she does not want to be tainted by it?
Mrs. Liddell:
The hon. Gentleman is indulging in speculation. My right hon. Friend the Prime Minister's policy unit is a matter for him but, in the few weeks that we have been in government, we have had reason to believe that the civil servants serving the Government are all intelligent, and we have every confidence in them.
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