Oral Answers to Questions |
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Mr. Pearson: We traditionally, and rightly, have a wide-ranging debate on the budget order. It would be difficult for us to spend two or so hours debating the technicalities of votes on account and the supplementary estimates. I assure hon. Members that I noted all the comments that have been made and I will try to reply to as many as possible, although they are inevitably extremely wide ranging. There is clearly an election in the offing. The hon. Member for South Antrim (David Burnside) wants more for education; the hon. Member for Strangford
Mr. Trimble: The Minister should not emphasise the fact that people are asking for increases in expenditure because, although the document is called a Northern Ireland budget, it is actually a statement of expenditure. There is nothing in it about revenue raising. It is therefore perfectly natural for members of the Committee to talk about expenditure. That is all that we are talking about. Mr. Pearson: It is natural to talk about expenditure, but we have to recognise reality. As the hon. Member for Belfast, North (Mr. Dodds) said, there is no such thing as a free lunch—everything has to be paid for. When hon. Members ask for more for health, education and children’s services, they have to provide the answers on how it will be paid for. At the moment, resources are voted from Parliament through the block grant, or raised through the regional rate or, principally for capital projects, through borrowing. If we are going to spend more on health, education and children’s services than is proposed in the budget, that implies that there has to be an increase in the regional rate. I believe that the draft budget reflects all the priorities in Northern Ireland and tries to set out a sensible way forward that strikes a balance between the funding required by different Departments and what burden we can expect the Northern Ireland ratepayer to meet. The proposed rate increase for 2005–06 of 9 per cent. sounds high, but for the average property holder in Northern Ireland it is equivalent to the cost of a Mars bar a week. That is not excessive. That Mars bar will close the gap under the reinvestment and reform initiative that the hon. Member for Belfast, North talked about and will enable us to fund a £200 million-a-year programme of capital investment under the RRI, which is an important component of the £16 billion draft investment strategy for Northern Ireland over the next 10 years. I shall talk about the economy before moving on to health, education, children’s services and the other detailed matters that have been raised. The hon. Member for North Antrim (Rev. Ian Paisley) asked me to consider the PricewaterhouseCoopers survey on the cost of doing business. He said that he was concerned about red lights—I think that was the term he used—for the economy. The hon. Member for Aylesbury also questioned the Government’s strategic direction. As a Government, we recognise that there is more to do to lay a path or to set a direction of travel for the Northern Ireland economy over the next decade, but let us not forget the significant progress that has been made over the past 10, or even the past five, years. For the first time in my memory,
In the priorities and budget, the accompanying economic vision document and the civil service reform document, “Fit for Purpose”, I have tried to set out the direction of travel in which I believe the Northern Ireland economy needs to go in the next 10 years. I do not think that there is much difference between the hon. Member for Aylesbury and I on this matter. I believe that over the next 10 years the size of the private sector in Northern Ireland has to grow substantially and the proportion of the economy accounted for by the private sector relative to the public sector has to increase. The hon. Gentleman asked specific questions about administration costs, but I do not want to get into a debate about figures. That might seem a strange thing to say when we are talking about a budget order, but he and I agree on the key message: there must be an objective to have a better but smaller public sector in Northern Ireland. The proposals in the budget document for 2,300 job cuts over three years are quite stretching, but they can be achieved through natural wastage without the need for redundancy schemes. Overall, taking into account the changes with the Water Service Government company and in the Department of Agriculture and Rural Development, there will be a reduction of 15 per cent. in the number of civil servants in Northern Ireland. That is a challenging target, but the senior management of the civil service are up for that challenge. We want to work constructively to ensure that that target is delivered and that the efficiencies identified within the efficiency technical notes for each Department are achieved. As the hon. Member for North Down would expect, I disagree with her about the Government’s handling of the industrial dispute. We did not want it to happen, but we made it clear all along that we were bound by Government pay policy and that the offer that we made was the maximum acceptable within the parameters of that policy. We had no room to manoeuvre. As a Government, we have a responsibility to take a responsible attitude to public pay throughout Whitehall and to bear in mind the fact that, as taxpayers, we all pay for the cost of public services and public servants. Lady Hermon: Will the Minister give way? Mr. Pearson: If I may, I will go through some of the detailed comments that were raised by the hon. Member for Aylesbury. He raised the issue of sickness absence. I assure him that managing attendance is a key priority in Northern Ireland Departments. Various management controls are being put in place to ensure that policies and procedures are rigorously implemented and effectively monitored. Since the
Along with a number of colleagues, the hon. Gentleman raised the issue of planning. As he will be aware, the Planning Service is in the second year of a three-year programme to deliver fundamental reforms to the planning system. A number of key issues have been addressed. Yes, we need to move forward. I fundamentally believe that, if Northern Ireland is to be a successful, competitive region in the next 10 years, it needs to have a fast and efficient Planning Service, particularly in respect of applications by companies that might want to locate in Northern Ireland. That must be a priority. The hon. Member for North Antrim was right to raise planning in relation to farms. Under the nitrates directive and the farm nutrient management scheme that I recently launched as the Minister with responsibility for agriculture, storage tanks larger than a certain size will require planning permission. We do not want planning delays in getting the storage capacity of the new systems up and running. Active discussions are going on to ensure that that can take place. I will briefly talk about education and health, which were raised by a number of hon. Members. The hon. Member for Aylesbury spoke about education, as did the hon. Member for South Antrim in a comprehensive contribution, but it was raised by other hon. Members as well. I recognise the concerns about the issue. I say first that expenditure per pupil in Northern Ireland is pretty high compared with expenditure per pupil in England, Wales or Scotland at either primary or secondary level. That is an important point to make. It is also important to recognise that the education budget will increase by 11 per cent. across the budget period and that there is a 62 per cent. increase in the capital programme. As part of the process of education reform, we will see an upgrading, a rebuilding and perhaps a rationalisation of educational provision throughout the region. That is right and it addresses some of the issues that the hon. Member for Aylesbury raised when talking about the possibility of achieving savings. From memory, his point was that a school is a school and it has a heating bill—[Interruption.] 5.29 pmSitting suspended for Divisions in the House. 5.54 pmOn resuming— Mr. Pearson: Moving on to health, I understand the concerns raised by the hon. Member for Strangford and other members of the Committee. The hon. Lady spoke in some detail about the costs in the health economy, which we all recognise. However, the simple fact is that the health service in Northern Ireland
I have discussed with the right hon. Member for Upper Bann the fact that health outcomes are significantly poorer in Northern Ireland than in England. That is one of the reasons why the Government appointed Professor John Appleby from the widely respected King’s Fund to undertake investigation into the health economy in Northern Ireland. It will be helpful to receive his report; we expect him to report in time for us to consider what he says when we are forming the budget for the following financial year. Several hon. Members raised concerns about children’s services, and I assure them that funding has not been withdrawn from projects funded by the children’s fund, and all existing commitments to projects from the fund will be honoured. As hon. Members will be aware, the priorities of the budget process allocated some £5 million across three years as an initial allocation to a community investment fund. A further £15 million has been allocated across three years for a capital modernisation fund, and children’s organisations can apply for support from it. In addition, substantial amounts are already contained within mainstream budgets for the benefit of children and young people. Further funding is provided through national Government programmes, such as through the benefits and tax credits system. On health, £200 million is spent annually on maternity, child health, family and child care, and £20 million per annum on children’s services, including residential care, foster care, autism, children learning care, eating disorder services and help for children with complex needs. I could go on to outline a range of initiatives in education and other areas in which the Government are actively supporting children. I assure the Committee that children and family remain a priority for the Government and they will continue to be so. My ministerial colleagues and I are happy to engage with the voluntary sector on some of the issues that have been raised. I understand some of that sector’s concerns, given the way in which it has traditionally been funded, mainly through health service projects. The hon. Member for Belfast, North talked about women’s groups, particularly one on the Shankill road with which I am familiar. Such organisations do good work and, as far as I am aware, women’s groups are still eligible to apply for funding under the Peace 2 extension programme. As he will know, that programme is not working at the same level as it did previously, but we shall still have had 12 years’ funding in Northern Ireland provided through the auspices of the European Commission, which I am sure everyone welcomes. Column Number: 44 The right hon. Member for Upper Bann raised the issue of Worktrack. He has a point, but the Government’s view is that Worktrack provided placements at a relatively high cost, often to people who were the easiest to place. With unemployment now at a record low of 4.5 per cent., it is vital to target our resources on people who are economically inactive and the most difficult to place because they lack skills. That is what we are increasingly trying to do by targeting the new deal to tailor-made skills provision for those in the greatest need. The hon. Member for Strangford raised the issue of the fishing community, which I, too, am very concerned about. Recently, I was able to announce a second year of transitional aid. It will be a final year, and we shall want to review the cod closure area, but the fact that, for a second year, we have found resources to run a transitional aid programme is welcomed by the fishing villages in her constituency. The taskforce has recently produced its report, and we are actively considering a number of recommendations that will look not just at the fishing community but the wider area. 5.59 pmLembit Öpik (Montgomeryshire) (LD): I apologise to the Committee for my late arrival—[Interruption.] Hon. Members: That was premature. 6 pmSitting suspended for a Division in the House. 6.15 pmOn resuming— Lembit Öpik: Once again, I apologise for my late arrival. Is the Committee aware that that is because, this afternoon, the Television and Radio Industries Club awarded TV weather presenter of the year—a significant accolade—to Sian Lloyd, one of the great icons of the Celtic community? I feel that I should declare that as an interest. Secondly and finally, although I deny that the hon. Member for Ealing, North is my doppelganger, despite a striking resemblance, he spoke great sense on the funding for Armagh observatory, and I agree with every word he said. Mr. Pearson: I always enjoy the hon. Gentleman’s contributions. I fully understand why he could not attend the Committee this afternoon. I can assure him that he missed a fascinating and wide-ranging debate. I should like briefly to cover three other areas: libraries, water and the review of public administration. Mr. Beggs: Perhaps the Minister might extend to his colleague the opportunity to indicate his willingness to come with his permanent secretary and meet the North Eastern education and library board to discuss its serious situation? Column Number: 45 Mr. Pearson: The Under-Secretary of State for Northern Ireland, my hon. Friend the Member for Brent, North, will have heard that contribution and will no doubt wish to respond. We debated libraries earlier. The hon. Member for North Antrim said that I had made a good attempt, but that I had no straw with which to make bricks. We have quite a few refractories producers in my constituency, but I will not go into the detail of brick-making technology; suffice it to say that I believe that things have changed there, just as they have done in the library service. It is important that education and library boards take that into consideration. Again, I make the point that we are not talking about cuts, because the budget for the library service will increase in the next financial year, and will continue to increase. The figures are an extra £2 million in 2006–07, and £2 million in 2007–08. The hon. Gentleman also talked about water and sought to lay responsibility for the poor-quality water infrastructure that I accept exists in Northern Ireland at the door of successive Governments. I understand why he does so. There is an issue of who pays for the improvements to infrastructure in Northern Ireland. The hon. Member for Belfast, North said that he believed that people in Northern Ireland were already paying for them through their rates. Let me respond to that, because the Government’s views need to continue to be put on record, although I do not want a big debate about the matter, because we have had that in other forums and will continue to do so. The average rates bill in Northern Ireland is 53 per cent. of the average rates bill in England—that is just over half. People in Northern Ireland do not pay water rates, unlike in England and Wales, where the average bill is in the region of £250. So if people in Northern Ireland are paying for the full cost of their water service, they are not really paying for much else. That is the simple reality. Rev. Ian Paisley: Will the Minister give way? Mr. Pearson: May I make another absolutely stunning point first? Rev. Ian Paisley: Make as many as you like. Mr. Pearson:When dealing with who pays for infrastructure improvements, my view is that people in England, Wales and Scotland have clearly paid for infrastructure improvements to their water services over the past 10 to 15 years as a result of privatisation. There was a thing called the K factor, which provided that charges would go up by more than the rate of inflation deliberately to deal with the investment needed in the infrastructure of the water and sewerage systems in England, Wales and Scotland. At the moment, we in Northern Ireland are undertaking a major investment programme that is funded partly by rates, but largely through the block grant. As hon. Members know, 94 per cent. of the Northern Ireland budget comes from voted expenditure here, and the remaining 6 per cent. is raised locally through the regional rate, so I do not agree with those who say that the Government have not taken their share of
Rev. Ian Paisley: I do recognise that, but the Minister does not recognise that the people of Northern Ireland are paying more for their electricity and heating than people in any other place in the United Kingdom. When the Government said that they were going to benefit them, what did they do? They said that Northern Ireland would not pay more than the dearest charge that is paid in the rest of the UK. They did not say that they would consider charges in the UK and give Northern Ireland parity. We are paying more for electricity and heating than any other part of the UK. Mr. Pearson: I accept that entirely. Electricity costs have been of deep concern to the Government. Only yesterday, the Under-Secretary of State for Northern Ireland, my hon. Friend the Member for Brent, North, announced that we should see a reduction of 1.5 per cent. in electricity bills for all consumers, which I am sure the Committee will welcome. None the less, we must accept that the regional rate in Northern Ireland is roughly half that of the average rate in England and Wales. In the past three years, domestic rate bills in Northern Ireland have increased by £92. At the same time, rate bills for the average English council have risen by £226. That difference needs to be borne in mind when we debate the resources that are going into health and education. Hon. Members will appreciate that the review of public administration is a major reform. It has not stalled. It is making progress. I hope that hon. Members will appreciate that I have tried to conduct it very much in discussion with representatives from the political parties. We hope to issue a consultation paper this month in the next phase of the RPA. It is being finalised, and I am sure that it will provide substantial opportunities for future debate. We are being asked today not to vote on the order, but to decide whether we have considered it. I believe that we have. Question put and agreed to. Resolved,
Motion made, and Question proposed, That the Committee do now adjourn.—[Vernon Coaker.] 6.24 pmMr. David Trimble (Upper Bann) (UUP): First, I should point out that the Department appears to refer to money advice services, but I call them debt counselling services. I believe that my phrase is more accurate and describes the flavour of the thing much better. I should also point out that there is nothing intrinsically wrong with debt—it is a very useful way of acquiring assets. I suppose that the golden rule for
Given the recent low interest rates and availability of many forms of credit, it is not surprising that some people get into difficulties. A report of the Department of Enterprise, Trade and Investment on the matter some time ago estimated that 10 per cent. of households in Northern Ireland were in debt arrears and 2 per cent. were in serious financial difficulties. Individual voluntary arrangements have gone up from 173 in 2001–02 to 219 in 2002–03, and bankruptcies have increased from 331 in 2001–02 to 582 in 2002–03—that is evidence of a degree of stress. I have been told that the citizens advice bureau office in Banbridge has handled 133 cases of serious debt since April 2000. It has handled 41 complex cases since April last year, and the people presenting usually have more than £20,000 of debt. The CAB office in Banbridge now has to turn people away. In July 2001, the CAB published a paper entitled “Would You Credit It?” The report was sent to the then Minister, Sir Reg Empey, who responded by agreeing to the proposal that debt be included in the forthcoming consumer strategy. In April 2002, DETI received a three-year package of, I believe, about £3 million to fund a consumer strategy, including Consumerline, consumer education and a strand for money advice. DETI commissioned a report from Elaine Kempson of Bristol university in September 2002. It received the report in April 2003, published it in May and consulted on it until September 2003. However, in December 2003, DETI wrote to inform various interested parties that money advice belonged with the Department for Social Development and should come under its advice and information strategy, which was then being drafted by Williamson Consulting. DETI advised that it had referred the question of a money advice strategy to Williamson Consulting, although it later transpired that it had been referred without any terms of reference. The CAB approached Sir Reg Empey about the matter and in the spring of 2004 he wrote to the Minister. In March 2004, the CAB also wrote to DETI and pointed out that the Department had had the report for some 12 months by then and that the consultation period had ended six months earlier. The reply the CAB got from DETI a month later was:
The CAB challenged that in further correspondence, pointing out that DETI clearly had lead responsibility for consumer affairs, the insolvency service, bankruptcies, the registration of insolvency practitioners, the regulation of trade and business, and financial legislation such as the Consumer Credit Act 1974, which seemed to point to a DETI responsibility. However, in its reply in May 2004, DETI stated:
Column Number: 48 Hon. Members may notice that a reason is not advanced in that passage. However, under pressure from various bodies, DETI did agree to a suggestion from the DSD in May 2004 that it second a member of staff to work in the DSD voluntary and community unit with a view to agreeing a money advice strategy with the voluntary sector, but it continued to dispute whether it had core responsibility. Indeed, throughout 2004 DETI refused to represent Northern Ireland on a Department of Trade and Industry working party on debt, and representation had to be provided by the DSD and the Office of the First Minister and Deputy First Minister. A seminar on a money advice strategy was held in 2004 at the General Consumer Council, and I understand that the dispute between the two Departments over core responsibility was painfully evident at that session. By October 2004, the two Departments issued a seven-page paper to the advice sector inviting proposals for a money advice strategy by Friday 25 October. Because of the delay, the sum available had now dropped from the original £1 million to £800,000. It was suggested that it be spent in two tranches: £400,000 by the end of March 2005 and a further £400,000 by the end of March 2006. There was no firm indication that this funding would be carried forward. Indeed, the dispute as to core responsibility continued to rumble on. It may be noted that it had now taken two and half years to produce a seven-page paper on this issue. It has to be conceded on behalf of the voluntary sector that there now followed a few weeks of delay attributable to differences of view within the voluntary elements. The 25 October deadline was not met because of those differences and also because they were trying to seek assurances on longer-term funding. The latter is a perfectly reasonable thing to do. On 9 November 2004, the CAB received a letter from DETI and the DSD jointly in which they said that they had to have a single proposal from the voluntary sector. They set a new deadline for that proposal of 19 November. The voluntary sector was given 10 days. However, that time was shortened because on 15 November they received an urgent phone call from DETI at 11 o’clock in the morning saying that the money would be lost and requesting bids by 3 pm. The various voluntary agencies dropped everything and managed to provide separate bids by 3 pm. Later that week, DETI surrendered £250,000 back because by then it had estimated that it could not spend that money by the end of March 2005. By 2 December, the various agencies and Departments agreed an allocation of the money. Later that month, the issue of core responsibility went to OFMDFM for arbitration, which ruled that DETI was the lead Department. That culminated on 31 January 2005 with the issue of a formal letter of offer for the remaining £150,000. A couple of days later DETI asked for that to be reprofiled. The CAB is asking for this sum or parts of it to be rolled over into the next financial year to enable it to retain its part-time worker in Banbridge and its
A number of questions arise. I have gone into some detail about what happened over the last few years just to show the quite remarkable situation that has developed. First, why was DETI asking questions about core responsibility? I should have thought it was obvious. Raising that issue meant a quite significant delay in the handling of the matter. Why did it go on for so long? Why was it not arbitrated on by OFMDFM until December 2004, providing a delay of at least six months, possibly a year. I asked earlier why it took two and half years to produce the seven-page paper that emerged in October 2004. Why, all that time having been taken, were the advice agencies given only a few weeks to respond? Why were no objective criteria used to assess the proposals that came forward? In particular, why were no criteria issued for the establishment of a money advice telephone helpline, and what criteria were used to decide not to allocate money for that purpose? There is also the question of the surrender of the £250,000 during the course of the year. What proposal does DETI now have for implementing a regional strategy on money advice comparable to, for example, the three-year strategy that has been recently published on the social economy? It was a comparatively simple piece of work. That it took so long is in itself an issue, but it also appears that there is no clear strategy for Northern Ireland. The account reveals a form of working within the Administration and Department that is wholly unsatisfactory and reinforces the idea that there is a lack of joined-up thinking in Northern Ireland Departments. I realise that the Minister has a lot on his plate, but I hope that he will be candid with the Committee. I would particularly appreciate it if the Minister told us when he personally became aware of the issue. I have set out what I understand has happened. It will be apparent to the Committee that I am relying heavily on the information given to me by the CAB, so it is possible that it is not the full picture. I am ready to stand corrected, but I would appreciate it if he told us when the issue came to him. How much was happening in the undergrowth of the Department without ministerial supervision? The problem in Northern Ireland of Departments behaving autonomously, not only as Departments but internally, and not giving Ministers information is much greater in Northern Ireland than elsewhere. It tends to be a problem
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