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16 Jan 2007 : Column 264WH—continued

1.12 pm

The Minister of State, Department of Health (Caroline Flint): I congratulate my hon. Friend the Member for Swansea, East (Mrs. James) on securing the debate. I also welcome the presence of my hon. Friends the Members for Halifax (Mrs. Riordan) and for West Lancashire (Rosie Cooper), and the earlier attendance of my hon. Friend the Member for Dundee, West (Mr. McGovern), who has had to leave the Chamber. I thank them for attending and for showing their support.

I thank my hon. Friend the Member for Swansea, East for her participation in discussions with officials in the Department of Health. They have been assisted by her information and experience locally, and by what she has gained from people contacting her, given the high profile that she has lent the issue. I must admit that one difficulty is securing the necessary data and information about the extent of the problem. We know, at least anecdotally, that coin-operated facilities in particular tend to be located in some of our more deprived communities. It is clear that they do not offer the beauty parlour experience that one might have in more affluent areas, where sunbeds under supervision sit alongside nail bars, facial services and everything else.

My hon. Friend has outlined today and shared with me in private meetings some of the ways in which the facility is open to abuse. The questions are about how much abuse takes place and who is responsible for trying to reduce the amount of misuse of coin-operated facilities.

The issue is important, and as she said, about 150 MPs from all parties signed her early-day motion. We continue to try to address the subject. Although my hon. Friend rightly draws attention to the public health concerns, it is an issue not only for the Department of Health but for the Department for Work and Pensions,
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to which the Health and Safety Executive is accountable; for the Department of Trade and Industry; and for the Department for Communities and Local Government, which leads on licensing matters. It does not sit with only one Department.

We share with my hon. Friend and others concern about the increase in the incidence of skin cancer and the importance of prevention. The popularity of tanned skin has raised the potential risks of getting skin cancer. However, the debate is not about people enjoying the sunshine but about the extent to which they do. That is important. There are benefits to sunshine through vitamin D, as we all know, but it is the extent to which people expose their skin, either naturally or artificially, which poses dangers for their future health. The trouble is that overexposure to natural sunlight or to sunbeds without protection does not manifest straight away. The problem is one of how we measure the impact of exposure on something that may manifest as skin cancer only some years later. It is a challenging area.

The Government discourage the cosmetic use of sunbeds, whether coin-operated or otherwise, particularly by young people. For adults, the key issue is that sunbed use is the result of an informed choice. However, for young people with skin at greater risk of damage from cosmetic tanning, and possibly an inadequate understanding of the potential harm, it is an issue not only for parents, as Consol said, but for the industry and for the Government.

For that reason, the Department of Health, along with other UK health organisations, has funded Cancer Research UK to run SunSmart, the national skin cancer prevention and sun protection campaign. The campaign includes raising public and professional awareness of skin cancer by providing information about it, including how it manifests and its early detection, and by providing guidance on preventive measures to reduce the risk of its occurring. The campaign raises awareness through support for health promotion events, the provision of printed resources, media briefings and the SunSmart website. It has proved a valuable addition to the exploration of concerns about skin cancer.

A key message of the campaign is to take care not to burn, whether in the sun or on sunbeds. We must reinforce that message as much as possible, and the website has a special section covering sunbeds. It highlights the fact that sunbeds, far from being cosmetic friends, cause premature skin ageing and blemishing at a younger age once the tan has faded. When discussing prevention among young people, that is an important message to get across, because unfortunately, the more serious problem of skin cancer may not appear until later in life. Focusing on the more immediate outcomes of over-use of sunbeds is an important way of getting the message across.

The campaign also makes the point that sunbeds should not be used by people who are particularly vulnerable. They include people with fairer skins, and specifically people under 16 years old, as my hon. Friend admirably pointed out. The Health and Safety
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Executive has also issued guidelines on the use of sunbeds for operators and customers. The guidelines are available on its website.

The guidance was developed in consultation with the Department of Health and leading experts. We have been trying to encourage self-regulation and the following of guidance. I noted my hon. Friend’s point about the Sunbed Association’s code and the basis on which it admits members to its organisation, because we want to ensure that anybody who operates sunbeds, whether coin-operated or otherwise, takes up the Health and Safety Executive’s guidance. There is a clear split of opinion among the sunbed industry on the subject, and that influences the debate.

Cancer Research UK has supported the guidance by working with representatives of the industry, particularly the Sunbed Association, to try to improve information for staff and customers. That includes displaying information about the use of sunbeds and the risks to customers’ health, and discouraging the use of sunbeds by young people under 16. There are issues with how one can meaningfully do so if there are no staff present to reinforce whatever written information is provided in an outlet.

As my hon. Friend rightly says, coin-operated sunbeds are often in establishments that do not use full-time staff. Last year, as a result of my discussions with her, I made a commitment to initiate cross-Government discussions to explore the options for regulating coin-operated sunbeds. She has taken part in those discussions, which have allowed us to exchange information in order to get a better understanding of the issues involved. We have considered licensing arrangements—local authorities have powers to license in this area—and we will discuss further the guidance currently provided by the Health and Safety Executive.

A sunbed symposium was held last autumn, which raised several issues including matters of data and information. I understand that the Chartered Institute of Environmental Health plans to follow up the survey results that it has pulled together with a fuller report. More information, from whatever source, would be very helpful for our future discussions on the provision of coin-operated sunbeds in communities and the way in which they are used by individuals.

There are a number of factors to consider, such as the different types of regulatory provision and their impact. I am aware that a Regulation of Sunbed Parlours Bill is being considered in Scotland. We are keeping a watchful eye on that and we are interested in the evidence base being considered as that Bill goes through the Scottish Parliament. There are common issues, although not necessarily identical ones, and clearly there is an opportunity for us to learn from the experiences of other parts of the UK, within our devolved island.

In the meantime, we continue to have discussions. I will be meeting my noble Friend Lord McKenzie of Luton, who has just taken responsibility for this area of health and safety within the Department for Work and Pensions, and that meeting will follow on from the one my hon. Friend the Member for Swansea, East had with Lord Hunt of Kings Heath, who has recently joined my Department.

This debate is timely, and it is opportune for me to explore the guidance with my colleague in the DWP,
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determine whether there are areas that we can tackle and think about strengthening the guidance and other routes that we may take. I welcome my hon. Friend’s campaign in this area, and I am sure that, along with me, she will seek to engage Departments that have a role to play in ensuring the best possible public health outcomes, particularly for those most vulnerable in our communities, such as those under the age of 16.

1.23 pm

Sitting suspended.

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Induced Car Crashes

1.28 pm

Mr. Richard Bacon (South Norfolk) (Con): I am very pleased to have the opportunity to present this debate on the Government’s prosecuting policy on induced car accidents.

An induced car accident happens when fraudsters who wish to claim from an insurance company drive motor vehicles to busy road junctions where they perform unexpected, unnecessary and dangerous emergency stops designed to cause innocent members of the public to crash into them. There are several favoured methods. Some disconnect the brake lights of their vehicle and then brake sharply in moving traffic once a victim is positioned behind. Others pull on to roundabouts from busy slip roads, then brake sharply once six to 10 feet over the line.

By forcing victims to crash into them from behind, under current insurance law, fraudsters can rely on a virtually automatic admission of liability by the victim’s insurers. They then submit multiple insurance claims—for personal injury, loss of earnings and so on—on behalf of the driver and multiple fake passengers, who are members of the criminal gang. If undetected, a single crash can net as much as £30,000 for the gang.

What is the scale of the problem? Research by the Insurance Fraud Bureau indicates that since 1999 over 22,500 fraudulent motor accidents have taken place throughout the country. The scam was first detected in the north of England, and insurers are now aware of gangs operating in many large UK cities and towns. Recently, there has been prolific growth in such activity in London and the south east. In 2003, insurers were aware of just four criminal gangs operating in the UK, but by November 2006, that had grown to 40, with an average of three new gangs being detected per month. Industry experience has shown that, once well established, such gangs can potentially induce 300 to 400 accidents per year. The problem is huge and growing.

Mr. John Greenway (Ryedale) (Con): I congratulate my hon. Friend on securing the debate. Does he agree that fraud is never a victimless crime—particularly insurance fraud—because we all pay through the premiums resulting from the fraudulent claims? Furthermore, does he share my concern that induced accidents are a serious threat to public safety and that innocent people could become embroiled in an accident resulting in serious injury or loss of life? That element stamps this as a real menace that must be tackled by the Government, the police and insurers in partnership.

Mr. Bacon: I am pleased that my hon. Friend raised that point. The threat to public safety is the single biggest problem. Of course, there are other issues, such as rising motor insurance premiums. I know that he has taken a big interest in the matter, as the chairman of the all-party group on insurance and financial services. He is right: the very serious and growing threat to public safety is the single biggest issue. Serious injuries such as broken limbs and crushed rib cages can occur,
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and have done. If the fraud is allowed to continue, there will almost certainly be fatalities and a growing injury rate.

Some evidence suggests that women driving alone and those on the school run with children are targeted by fraudsters because they think that they are more likely to admit liability. As my hon. Friend said, these crimes are forcing insurance premiums to rise, which is paid for by innocent motorists, and insurers estimate that the fraud is now yielding at least £200 million a year for organised criminals. The phenomenon is growing so quickly, however, that that could be a significant underestimate. We are talking about many hundreds of millions of pounds.

That links directly to the third issue: cash generated from the fraud is fuelling the growth of organised crime. Norwich Union referred to that in its 2005 fraud report, “Shedding Light on Hidden Crime”. Insurers believe that the proceeds from induced car accidents are being used routinely to fund other forms of organised crime, including drugs and people trafficking, benefits and credit card fraud and money laundering. It might even be funding terrorism. Induced accident fraud started among predominantly Muslim gangs in the north of England, but has now spread so widely that criminals from all backgrounds are involved.

It remains the case, however, that the gangs that started the earliest and so acquired the most expertise have been the most successful in perpetrating the fraud. That is reflected geographically in the figures for the number of staged accidents. The Insurance Fraud Bureau has estimated that since 1999 there have been 22,605 staged or induced accidents, and has broken them down city by city. Blackburn comes top, with 1,710 staged accidents since 1999—7.5 per cent. of the total. Bradford and Birmingham come next, followed by Oldham. Those four cities alone account for more than a quarter of all such crashes. Bolton, Manchester, Liverpool and Preston come next and bring the total to more than 42 per cent.—some 9,500 crashes. The Serious Organised Crime Agency monitors terrorists’ finances. I hope that the Solicitor-General can tell us that the agency is aware of those figures, which indicate a significant concentration in a small number of northern cities where Asian gangs—they are predominantly Muslim—started this fraud.

I shall examine the reasons for the quick growth of the fraud. Before 2006, the police were generally unable to investigate these organised gangs. Typical cited reasons for not doing so are limited resources or the low prioritisation of fraud in the national policing plan—no targets were set. This fraud has been an extremely profitable and almost risk-free activity, so it would have been extraordinary if it had been ignored by organised crime. Since 2006, with the growing focus on fraud as a national issue, police forces in the south of England have begun to investigate more cases of such fraud. In notable cases, prosecutions are ongoing. To date, however, no police force in the north of England, where this problem started and is most prolific, has investigated a single case. Consequently, the vast majority of the 40 known gangs operating in the UK are not under investigation.

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I remind hon. Members that it took six to seven years to generate more than 22,000 crashes. The Insurance Fraud Bureau believes that at the current rate of growth, a further 20,000 crashes will be generated over the next 18 months. Another reason for the growth is that the crime is so profitable and easy that it is now being franchised. Insurers have obtained intelligence that they believe indicates that the largest and most prolific gang in the north-east is effectively selling franchises to other gangs, providing support, set-up and driver training. I am given to understand that requests to investigate the gang have been refused routinely by the relevant police authorities.

I shall examine the implications for the policing and prosecuting authorities. It is a national problem requiring a structured national response. In my view, any significant delay represents an unacceptable risk to public safety. Without the consistent threat of prosecution across the UK, experience has shown that the problem will continue to grow. Police targets are set on the basis of harm caused to individuals and society by a particular crime. That approach makes a strong case for making the prosecution of induced accident fraud an immediate priority—it poses a direct risk to public safety, funds organised crime and possibly terrorism, and impacts on society through higher motor insurance premiums and the rate at which the problem is growing.

In my view, a case could be made also for the immediate ring-fencing of police anti-fraud resources around the UK, as recommended by the Attorney-General in his excellent fraud review last year. Without that, we can reasonably expect a continued erosion of specialised police anti-fraud resources. In the past decade, available resources for combating fraud outside London have been halved. Last year, at the request of the Home Office, following representations from the insurance industry, an evidence-based threat assessment was submitted to the Home Office by the Association of British Insurers detailing and quantifying the threat to the UK of induced accidents and requesting urgent and co-ordinated action from law enforcement agencies.

That has been superseded by more recent research by the newly formed Insurance Fraud Bureau indicating that the problem is significantly larger than first thought. Details of that research were presented to the all-party group on insurance and financial services, chaired by my hon. Friend the Member for Ryedale, (Mr. Greenway) and subsequently shared with MPs from affected constituencies. I would like clarification from the Government on a number of questions. First, who in the Government is responsible for considering the implications of the research and deciding on an appropriate course of action? Secondly, is such consideration ongoing, and if so, when will a decision be reached? Thirdly, will the relevant Minister advise us on the action to be taken to combat the national problem of induced accidents and on how the Government intend to stop its prolific growth? Fourthly, will that Minister agree to meet with the Association of Chief Police Officers to discuss how to prioritise the arrest and prosecution of such gangs before the problem escalates out of all proportion?

Induced accident fraud is just one example of the wider problem of fraud. Its recent growth is connected
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to low awareness of fraud and the fact that it has not been a national policing priority. However, it is important to say that good work is now being done. I applaud both the growing efforts of our police in the south-east and the excellent work done by the Attorney-General’s fraud review team.

Almost overnight, our perception of the problem has changed. For example, the Attorney-General’s review concluded that fraud as a crime is perhaps second only to class A drugs in the harm that it does nationally. Induced accident fraud is only one of the many rapidly growing methods of fraud facing us, which include VAT fraud, benefit fraud, credit card fraud and corporate fraud. I welcome the Attorney-General’s review of fraud and support its recommendations, which once implemented will lay the foundations of a more fraud-resistant economy and society. I await the Government’s response to those recommendations and would welcome active steps to ensure that they are implemented as soon as possible. The Attorney-General’s report recognised that there are currently no up-to-date statistics on the extent and impact of fraud on the UK. I await with interest the ACPO study to measure that, which I believe is due to be published next month. Perhaps the Solicitor-General could tell us whether he has met the Attorney-General to discuss the recommendations of the fraud review and say what hope he has that the recommendations will be implemented.

I have focused most of my remarks in this debate on induced accident fraud, so I hope that the Solicitor-General will concentrate primarily on that in his reply. I hope that I have persuaded him of the seriousness of the issue. Induced accident fraud is one of the most startling forms of fraud. It targets innocent motorists in a disgraceful way, and is a significant and growing threat to public safety. It offers organised criminal gangs easy pickings that are nearly risk-free for the fraudsters. Although some police forces are now taking an interest, there is a long way to go. There are large parts of the country, particularly in the north of England, where the organised criminal gangs undertaking the fraud are unimpeded and uninvestigated, and can operate with virtually zero risk of prosecution. Finally, the proceeds of such crimes are used to finance more organised crime. This cannot continue.

1.41 pm

The Solicitor-General (Mr. Mike O'Brien): I congratulate the hon. Member for South Norfolk (Mr. Bacon) on securing this debate on an issue that I agree demands greater public awareness. The insurance industry has been aware of it for some time, but only a relatively short time, in the sense that such fraud has grown quite spectacularly in recent months and years. I also welcome the hon. Member for Ryedale (Mr. Greenway), who has taken a keen interest in such issues.

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