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16 Oct 2006 : Column 597

On water charges, I give the right hon. Gentleman an undertaking to consult all parties, including his own, on their detail. There is no question about that. Perhaps that is the sort of issue that we can consider in the programme for government committee, of which he will be a member. The incoming Executive will have to take the matter forward. There will be a big hole in the budget amounting to some £200 million to £300 million of investment over the years that the water charges are phased in. Until they are fully phased in, there will be an investment gap of between £200 million and £300 million in the water and sewerage system if we do not raise the money as suggested. In addition, the phasing in of water charges would allow about £200 million to be released to fund extra public services, including health, education and housing. It is a difficult decision, but it is necessary if we are to square the budget gap. I hope all the parties, including the right hon. Gentleman’s, will approach the matter in the spirit of getting it right, rather than rejecting it outright. In the meantime, we need to take it forward in the House.

Mark Durkan (Foyle) (SDLP): I welcome the statement from the Secretary of State and, most importantly, the progress that it related to the House. Does he recognise that those of us who have always believed in power-sharing in Northern Ireland always believed in a ministerial council north and south in Ireland, and always believed in a new beginning for policing? That belief is vindicated as we see the DUP move to the threshold of accepting the inclusion of power-sharing, and Sinn Fein move to the threshold of accepting policing.

Does the Secretary of State recognise that we are on the right side of the mountain? Yes, there is some way to go and we need to make sure that we optimise the possibilities and minimise the problems, and some problems remain. With reference to what he told us about MI5, we still have a complaints system under which Osama can complain about being got at by MI5, but the Omagh victims cannot complain about being let down by MI5. We need to improve that. In the interests of taking the wider issues forward, will the Secretary of State agree to think again about issues such as water reform and the review of public administration, at least on hearing from the programme for government committee?

On the issues that we still need to cover in the preparation for government committee relating to rule changes and procedures in the Assembly, does the right hon. Gentleman recognise that some of us have concerns about proposals that would invite bad politics and guarantee bad government? If we work through those problems in the spirit that we showed during the summer, we can soon move from a situation where politics has been about counting the casualties of the past to one where politics is about setting the priorities of a shared future.

Mr. Hain: I greatly welcome my hon. Friend’s comments and acknowledge his own dedicated role in bringing us to this point. He will have seen in great detail—he has been through it with us—annexe E of the St. Andrews agreement, which deals with national security and MI5.

On water charges, I have said what I have to say. There is no way of ducking that issue for the future of Northern Ireland and the health of public finances and investment in the water system.

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On the review of public administration, the House has already set the boundaries for seven councils by primary legislation. I remind my hon. Friend that those are coterminous with the basic policing commands. They are also coterminous with health and with the area planning that will be delivered by the new education and skills council. That provides a unique opportunity for joined-up local administration. I agree that we must get the institutional changes absolutely right, because there is a real danger of governmental paralysis if we do not. We need to pay attention to the detail.

Mr. Mackay: The Secretary of State deserves the support of everybody in this House. He was clearly right to say that all political parties in Northern Ireland must unequivocally support the Police Service. He went on to say that he is absolutely confident that Sinn Fein will do so, which is optimistic and welcome. Can he give us the reasons why?

Mr. Hain: I am grateful to the right hon. Gentleman, who has adopted a particularly critical position, for reasons that I understand, and has given a lot of attention and energy to this matter. I think that Sinn Fein will deliver what its leaders have promised in recent days. It did not disagree at St. Andrews but instead said that it had to consult its members—as, to be fair, the DUP said that it had to consult its members about how a popular mandate is obtained and other issues. I believe that it will deliver. Delivery is important—as the right hon. Member for North Antrim (Rev. Ian Paisley) said, it is not just promises we need.

Kate Hoey (Vauxhall) (Lab): I welcome the progress made at St. Andrews based on the fundamental principle of all parties accepting the rule of law. I also welcome the ancillary agreements to do with academic selection and rates. On rate capping, exactly what would happen if for some, perhaps technical, reason the ard fheis was not able to be held by 24 November, the date passed, and there was no First Minister or Deputy Minister? Is the Secretary of State really saying that the pensioners of Northern Ireland, who would be helped by his proposed change, would no longer be helped and the rating system would stay as it is?

Mr. Hain: There is already considerable protection—unique protection compared with Great Britain—for pensioners and others on low incomes. The capping affects no more than several thousand people who have seen their bills go through the roof under the current proposals. If the agreement unravels by 24 November, the Government will proceed with what we think are the best policies—whether on academic selection, rate capping or any other matter—because we will have to dissolve the Assembly. We have declared our support for those best policies. The changes that I announced came out of tough negotiations at St. Andrews. It is a case of stand or fall on several matters in relation to securing and implementing agreement by 24 November.

Mr. Peter Robinson (Belfast, East) (DUP): Will the Secretary of State accept from me that while enormous progress was made at St. Andrews, there is still a considerable workload to be got through, but my party is willing to work through the remaining issues with him?

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I have two questions for the Secretary of State. First, in relation to the devolution of policing and justice, can he confirm that it is not an automatic process but entirely the case, under the Northern Ireland (Miscellaneous Provisions) Act 2006 passed by this House, that before such devolution can take place the First Minister has to give his approval and approval is required on a cross-community vote of the Assembly?

Secondly, while I know that the Secretary of State is planning for a smoothly operating Executive, the St. Andrews agreement touches on the possibility of a breach of the terms of the agreement. Can he confirm that the party that defaults will be penalised, not every party as has been the case in the past? Can he also confirm that the Government will not act out of kilter with any recommendation from the IMC in sanctioning defaulting parties?

Mr. Hain: I can certainly give the hon. Gentleman an assurance on the latter point in line with established practice in legislation and I am grateful for his offer of support.

Devolution of policing and justice is not automatic. All the parties, including Sinn Fein, supported the Northern Ireland (Miscellaneous Provisions) Act, for which the House voted and which received Royal Assent in July. It provides for the nomination of a First Minister, Deputy First Minister and then a cross-community vote for the timing of implementing devolution. However, I hope that people will consider the practicalities, too. As I said in the statement, huge parts of operational policing have already been devolved in practical terms. What remains is important but has more to do with the administration of justice.

Michael Connarty (Linlithgow and East Falkirk) (Lab): First, may I thank the Secretary of State and all the parties for the tremendous advances that they have made, not only at St. Andrews, but in all the years that I have been a Member of Parliament and travelling backwards and forwards to Northern Ireland? Hearing people from Northern Ireland parties arguing about matters such as water and rates would hearten the many trade union members I met when I gathered a trade union meeting in Northern Ireland a few months ago because those issues concern them.

However, as the leader of the DUP said, all must be based on a 100 per cent., unfailing commitment to the rule of the law. When does my right hon. Friend anticipate that the Police Service of Northern Ireland will not fly in and out of south Armagh, as it did when I previously visited that part of the Province, but operate normally by driving in and out of that southern part, in safety and security, knowing that all the communities and parties in the area support it?

Mr. Hain: Again, I am grateful to my hon. Friend, who takes a keen interest in Northern Ireland affairs and whose advice is valuable. The Police Service of Northern Ireland is increasingly deploying southwards towards the border, across Armagh and south Armagh.
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Bobby Hunniford, the local commander, is experiencing considerable community support, and so it is simply a matter of continuing that until every square inch of Northern Ireland is covered.

John Bercow (Buckingham) (Con): Given the importance that the Secretary of State rightly attached in his statement to the principles of equality and human rights for all, will he take the opportunity to confirm that the Equality Act 2006, together with any associated regulations flowing therefrom, will be applied in the same way in Northern Ireland as in every other part of the United Kingdom?

Mr. Hain: The answer is yes. Perhaps I could clarify, in response to the hon. Member for Belfast, East (Mr. Robinson), that the commitment of the two Prime Ministers in paragraph 11 of the agreement makes it clear that I do not envisage any circumstances in which the Government would exercise the power to implement Independent Monitoring Commission recommendations in a manner that was inconsistent with those recommendations.

Mrs. Iris Robinson (Strangford) (DUP): In his statement, the Secretary of State said that the Catholic content of the PSNI is rising to one in three—the House will welcome that. Are we now close to the removal of the discriminatory 50:50 recruitment rule?

Mr. Hain: I am grateful for the hon. Lady’s welcome for the progress that we have made—it is in everybody’s interests that Catholics are encouraged to join the PSNI and represented in the regular officer ranks and, indeed, in those of community support officers. If we make the progress that we expect, the 50:50 recruitment procedure can be lifted before the date in the Patten recommendations, which is 2011. I expect that to happen.

Mr. Douglas Hogg (Sleaford and North Hykeham) (Con): May I put it to the Secretary of State that his suggestion that legislation will be introduced and enacted in four days—that was the implication of what he said—is a matter of considerable concern? Given that, will he please find a way to outline the Bill’s principal proposals and put them in writing to the House before 20 November? Secondly, will he consider discussions with Mr. Speaker’s Office to ensure that amendments can be tabled in time?

Mr. Hain: Certainly, I want to consider the matter carefully. Like me, the right hon. and learned Gentleman is keen on parliamentary scrutiny. We must discuss those issues with the Opposition spokesman for Northern Ireland—we want to act by consent. However, we are up against a deadline.

As has previously been the case in Northern Ireland, we will need the co-operation of the House—including, I hope, that of the right hon. and learned Gentleman. If I am able to publish that information early, I will do so, by all means, but that rather depends on the parties sticking to their side of the bargain and telling us where they stand, by 10 November at the latest.

Mark Pritchard (The Wrekin) (Con): On the important issue of delivery, what timetable has the Secretary of
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State in mind for the dismantling of terrorist structures, not least the IRA’s security department and intelligence committee? Would 10 November be a good starting point for the IRA to show its good will towards this agreement?

Mr. Hain: The IMC report of 4 October makes it crystal clear that the IRA is delivering on what it promised. I repeat that it has disbanded the structures that were responsible for procurement, engineering and training in its military capacity. On intelligence, the previous IMC report stated that that was no longer directed at military activity.

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Point of Order

4.26 pm

Hugh Robertson (Faversham and Mid-Kent) (Con): On a point of order, Mr. Speaker. You will be aware of the extensive coverage in the newspapers over the weekend and this morning of the new chair of Sport England and his links with senior members of the Government. With the onset of 2012, the chairmanship of Sport England is more important than ever before. Have you received any indication from the Department for Culture, Media and Sport that it wishes to make a statement on this matter to set the record straight?

Mr. Speaker: Order. That is not a matter for me.

16 Oct 2006 : Column 603

Opposition Day

[19th allotted day]

Post Office

Mr. Speaker: I inform the House that I have selected the amendment tabled in the name of the Prime Minister.

4.26 pm

Mr. Edward Davey (Kingston and Surbiton) (LD): I beg to move,

Royal Mail and the Post Office are in crisis. If anyone should doubt that, or ask why we are holding this debate today, they need only read page 2 of today’s Financial Times and last week’s report from Postcomm. The report backs up the warnings that Liberal Democrat Members of Parliament have been giving for at least the past year and, unfortunately, confirms our worst fears. For those hon. Members who have not read the Financial Times today, it contains a piece headed

The article was written following an interview with the Secretary of State for Trade and Industry, so we believe that it is well sourced. It suggests that the Government intend to make a statement before the Christmas recess about that cull.

The Postcomm report was equally alarming. It shows that decisions by the Government, as well as their lack of decision making, have caused the current chaos. In other words, the Government have been getting it wrong and have failed subsequently to put it right. I do not think that I have ever read a report from an independent regulator that contains such stinging criticism; it is probably unprecedented. It talks about the Government’s failure to deliver on tough and overdue decisions, and about the possible cutting of nearly 6,500 post offices in the rural network that are making a loss.

The Liberal Democrats’ argument today is that the problem has been caused by the Government’s decisions over the past few years on pension books,
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television licences, passports and the Driver and Vehicle Licensing Agency, and by their indecision on the social network payment, the Post Office card account and the future of Royal Mail. These are the factors that have brought this crisis to a head.

Mr. John Redwood (Wokingham) (Con): Will the hon. Gentleman remind the House how much income the Government have withdrawn from post offices, and how many post offices have already closed? Does he not agree that a lot of this has already happened?

Mr. Davey: I will deal with those detailed points in a moment. The right hon. Gentleman is absolutely right; the Government have withdrawn hundreds of millions of pounds of business from post offices, which has caused many of the closures.

Bob Spink (Castle Point) (Con): Does the hon. Gentleman believe that there is still an opportunity for the Government to reverse their short-sighted policy to withdraw public business from post offices? Such a reversal would receive all-party support and benefit all post offices, particularly the new one that I opened in Canvey Island high street this summer.

Mr. Davey: The hon. Gentleman makes his point well, and I think I can agree with him.

Geraldine Smith (Morecambe and Lunesdale) (Lab): Does the hon. Gentleman think, as his party does, that the solution is to privatise Royal Mail, the most profitable part of the Post Office that, in effect, is a cross-subsidy that helps to keep the rural network going? Surely that is a crazy idea. Will he make clear the Liberal Democrats’ intentions to privatise Royal Mail?

Mr. Davey: I am grateful for the hon. Lady’s intervention. I shall provide detailed analysis of our policy and advocate it to the House tonight. We do envisage a partial privatisation of the Royal Mail, with 49 per cent. of the shares being sold to the private sector. Her Government, however, are privatising Royal Mail by stealth. They are under-investing in Royal Mail and are not backing it, and as a result private competitors are winning market share and undermining the Royal Mail, its employees’ jobs and services to our constituents. She is therefore backing privatisation by stealth, and she ought to be aware of that.

Mr. Mike Weir (Angus) (SNP): Will the hon. Gentleman give way?

Mr. Davey: No, I shall make some progress.

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