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Chris Bryant (Rhondda) (Lab): Further to the point about the Russian Federation, considering Europe’s heavy dependence on Russia for much of its energy, is it not vital that we get Russia to sign up to the CO2 emissions action as well, and that we try to persuade Russia to adopt a more secure path in the liberalisation
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of its market so that people can have confidence in the investment that they make in Russia?

The Prime Minister: That would be sensible for us and, dare I say it, for the Russian Federation as well, but it is a decision that it has to take. For our country and other European countries, the concept of the common European energy policy has come about in part because people want the strength of countries acting together when we negotiate with those who are going to supply a large part of our energy needs. It is very sensible for us to do that. I also think that if we can get the right type of relationship with Russia, it will make a big difference to our security and, as my hon. Friend rightly implies, to its competitiveness.

Andrew Miller (Ellesmere Port and Neston) (Lab): I am sure that my right hon. Friend will agree that the summit will have a significant impact on companies that are considering investing in energy-saving technologies and in particular in developing new businesses. At a recent awards ceremony, sponsored by Shell, that I was privileged to attend on this very subject, a number of companies that were the winners displayed products that were near to market and at-market, which could significantly help this country. He mentioned the building schools for the future programme. Will he ensure that such companies are given support in public sector procurement, because it is a way in which the Government can give a lead?

The Prime Minister: My hon. Friend is right to say that. We must ensure that we give proper support to those companies that have imaginative and near-to-market proposals. The important thing for Governments is not to try to pick the technologies, but to incentivise the development of the technologies. The market will do the rest.

Mr. Roger Gale (North Thanet) (Con): Did the European Council discuss the proscription of the People’s Mujaheddin of Iran? Will the Prime Minister explain his Government’s reluctance to accept the findings of the European Court of First Instance in that matter?

The Prime Minister: We did not discuss it. I shall write to the hon. Gentleman about the Government’s position.

Mr. Bernard Jenkin (North Essex) (Con): How do the Government propose to measure the Commission’s action programme for reducing administrative burdens in the EU and the success of the programme? It is easy enough to count directives or regulations merged or scrapped, but what is the cost of European regulation on British business? Do the Government propose to publish figures showing that the cost for that will start to decline instead of carrying on increasing?

The Prime Minister: The Commission has its own means now of assessing and, I think, publishing—I shall check that in case I am wrong—the administrative costs of legislation. The idea is to reduce the percentage of those costs by 25 per cent. That is its purpose and it
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is similar to what we have proposed in the UK. The whole point is that administrative costs should be measurable. I agree that it is a big change in what the European Union has done up to now, but I would think and hope that the hon. Gentleman welcomed that.

Adam Afriyie (Windsor) (Con): Given that the Prime Minister has told us that aviation is supposed to enter the emissions trading scheme in 2011, will he or his Chancellor be making proposals to offset their massive increase in air passenger duty against that scheme?

The Prime Minister: I think that I am right in saying that the increase in air passenger duty will cost significantly less, certainly for most domestic travel, than VAT on airline fuel or the proposals of the Leader of the Opposition. The most important thing is that whatever we do, we do it Europe-wide. I am not saying that we cannot do certain things domestically, but we must be careful to get the balance right, as I said. I think that those proposals do not.

Bob Spink (Castle Point) (Con): What action are the Prime Minister and Europe taking to ensure that the global price for carbon will enable the carbon trading policies to work effectively?

The Prime Minister: The way in which the emissions trading system works is to set a cap on emissions for each individual country and trade the permits within that system. Basically, the price is set through the cap. Progressively, we need to lower the cap so that the carbon price is transparent and the necessary incentive is given for business and industry to develop the science and technology to deal with it.

Incidentally, I agree that we have to be careful in the way in which permits are traded, but the single most important thing is to be able, progressively over time, to reduce that cap. If we could get a situation whereby there were other regional emission trading systems and they at some point linked up, that would probably be the best route to a global carbon trading system, which is, in the end, what we need.

Mr. Greg Hands (Hammersmith and Fulham) (Con): The President of the European Commission, José Manuel Barroso, told Der Spiegel on Friday that the EU has no formal competency on energy policies, which it would have only after the passing of the EU constitution. On getting action on climate change, he said:

Does the Prime Minister agree that he needs to send a message to Mr. Barroso that we do not need to wait for structural change in the EU to get strong collective action on both energy security and climate change?

The Prime Minister: To be fair, President Barroso is taking action. He is right in saying that energy was part of the constitutional treaty. Irrespective of what is in the treaty, we can take common action at a European level, which is what we have agreed to do. I think that he has shown commendable leadership on that issue.

Mr. Robert Goodwill (Scarborough and Whitby) (Con): Does the Prime Minister agree that the effectiveness of the existing EU emissions trading scheme has been undermined by the over-generous allocation of carbon credits to certain member states?

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The Prime Minister: That is probably true, but it is not very surprising at this stage. The scheme has just begun, and it is the first of its type in the world. Just as at a national level we have to be careful that we do not get so far out in front of the pack that we damage our own business and consumers, so at a European level we operate in a globally competitive economy. I think that I am right in saying that European emissions comprise 15 per cent. or possibly a little bit more of the total. In the end, the purpose of the European emissions trading system is, as it develops, to become more effective, which is why President Barroso is trying to set much more ambitious caps for 2008 to 2012. In time, we will bump up against a limit in Europe, unless we can draw in other countries. As the hon. Gentleman will know, it would be an understatement to say that the leaders of European industry are concerned about how the European emissions trading system may develop. We need to take the process in stages. It is important that we achieve an agreement at the G8 plus 5 to the principle of a stabilisation goal and of a global carbon trading system to make the process move forward.

John Bercow (Buckingham) (Con): Given that Russia’s increasing authoritarianism and truly lamentable human rights record should be of continuing concern to all EU member states and that regional instability threatens to hinder progress on a wide range of issues from organised crime to nuclear proliferation, will the Prime Minister tell the House about whatever discussions took place at the summit on the need to engage with Russia above and beyond energy matters?

The Prime Minister: I cannot recall offhand particular discussions on that at the summit, but I think it a fair characterisation to say that it is a running theme of all European meetings at the moment. There is a desire to engage with Russia as a major partner for Europe, but there is also a great deal of wariness for the very reasons that the hon. Gentleman gives. One of the
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reasons countries around Europe are taking decisions on energy policy, such as some of the decisions that we have taken here, is the concern about that. I hope that Russia understands and realises that its best prospect of playing its full part in the international community, and certainly its best opportunity to be a strong economy, is if it plays by the same rules as everybody else in Europe and America, too. I assure the hon. Gentleman that at every opportunity we discuss the matter both with our allies and, in so far as we can, with the Russians. I think that developments in the next couple of years will be extremely important.

Mr. Henry Bellingham (North-West Norfolk) (Con): Further to the question asked by the right hon. Member for Leicester, East (Keith Vaz), may I ask the Prime Minister again about the Lisbon agenda? How much discussion took place on the Lisbon agenda? Is it still his Government’s intention to retain Britain’s individual opt-out on the working time directive?

The Prime Minister: We will not do anything that puts at risk our position on the working time directive. We do want a resolution of this, however, since, as the hon. Gentleman knows, we have real problems with the SIMAP and Jaeger judgments, which are costing our health service a very significant sum every year.

Yes, there was a discussion about the Lisbon agenda, and it forms part of the conclusions. In the end, however, the best way of getting the Lisbon agenda taken forward is to support a strong European Commission. That may not be absolutely to the hon. Gentleman’s liking, but it is the best way of doing it. The whole point about the single market is that what ultimately stands in the way of its completion is the various vested interests of the various member states and their industrial sectors. The only bulwark against that is the European Commission, which is why it is so important that we give full support to President Barroso and his agenda.

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Points of Order

4.25 pm

Dr. Julian Lewis (New Forest, East) (Con): On a point of order, Mr. Speaker. I know that you are not responsible in any way for the quality of Departments’ replies to written questions, but I believe that the named day procedure was put in place to limit the number of questions that we ask on a given day for written answer so that we would have a good chance of getting a decent answer to them. In mid-December, I tabled a series of very specific questions about the assassination of Georgi Markov in 1978, bearing in mind that next year the statute of limitations will run out for any possible prosecution of the alleged assassin, Francesco Gullino. I was given a holding answer on 19 December saying that a reply would be given as soon as possible, but I have had to wait until 8 March to receive the substantive answer, which reads:

I could just as easily have been told that on 19 December and not have lost two and a half months. Is it not part of the deal that if the Department is going to give an answer such as that it should give it on the named day?

Mr. Speaker: I can take the blame for many things, but I am not responsible for the answers that Ministers give.

Mike Penning (Hemel Hempstead) (Con): On a point of order, Mr. Speaker. I wonder whether I can seek your advice. Some 1,400 of my constituents wrote to the Secretary of State for Health about their concerns about the closure of our local general hospital. On 1 February, the Minister of State, Department of Health, the hon. Member for Leigh (Andy Burnham), who is on the Front Bench, wrote to me assuring me that even though acute services would be closed, an independent sector treatment centre would be built in my constituency. Yet on Friday evening, the chief executive of my trust phoned to tell me that the ISTC was not going ahead and my constituents had been misled. How can we clarify such misleading statements from Ministers?

Mr. Speaker: It sounds to me as though the hon. Gentleman should apply for an Adjournment debate. I cannot make any promises, but sometimes the Speaker looks at local constituency matters favourably.
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[2nd Allotted Day]


NHS Deficits

[Relevant documents: The First Report from the Health Committee, Session 2006-07, HC 73-I, National Health Service Deficits, and the Government Response thereto, Cm 7028; and the Department of Health Departmental Report 2006, Cm 6814.]

Motion made, and Question proposed,

4.28 pm

Mr. Kevin Barron (Rother Valley) (Lab): First, let me say how pleased I am that we have this opportunity to debate the Health Committee’s report on national health service deficits and the Government’s response. I thank the Liaison Committee and the scrutiny unit of the House of Commons for assisting us in this process. I thank members of the Health Committee, some of whom are in their places this afternoon. They have spent many weeks and months working on the report. I thank the secretariat and the special advisers who helped us to draw up the report, which we published before Christmas.

I would also like to thank the Department of Health. It published not only the response to our report on 20 February, but, by coincidence, its own examination into deficits— [Interruption.]

Mr. Speaker: Order. An awful lot of private, loud conversations are taking place in the Chamber. That is unfair to the right hon. Gentleman.

Mr. Barron: The Department published a document to explain the national health service deficits. It was conducted by the chief economist of the Department’s corporate analytical team. Coincidentally again, on the same day that the Government response to our report was published, they also published quarter three of the NHS returns for this financial year.

I want to pick up some of the more serious points that we made in the report and consider the Government’s response to them. Let me begin with the introduction in 2004-05 of resource accounting and budgeting. The Health Committee considered that in great detail and took evidence from the Audit Commission, which had also examined the change in accounting in NHS bodies. It and the Health Committee were critical of resource accounting and budgeting.

I appreciate that the Minister of State, Department of Health, my hon. Friend the Member for Leigh
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(Andy Burnham) will doubtless speak about the matter at some length, but let me cite paragraph 25 of the Government response, which states:

Will my hon. Friend the Minister tell the House the Government’s exact thinking on the matter? It worried the Committee, the Audit Commission and many parts of the NHS.

Mr. Andrew Lansley (South Cambridgeshire) (Con): The Select Committee sought the disapplication of resource accounting and budgeting to the NHS. For me—and, I suspect, for the Government—there is a good case for not applying it to NHS hospital trusts run as businesses, or, indeed, to NHS provider trusts. However, there is not a good case for not applying RAB to primary care trusts, which receive a given amount of public expenditure resources. They should live within the overall resource envelope.

Mr. Barron: As an individual, and not speaking on behalf of the Committee, I accept that all sectors of the NHS—primary or acute sector trusts—have the responsibility to the taxpayer to work within their budgets and their means. That has clearly been difficult for some of them in recent years because of the change to resource accounting and budgeting. The Committee and the Government’s analytical team have considered that in recent months.

Mr. Lansley: Let me make my point clear. All provider trusts in the NHS are businesses. In the course of their normal business, they may well incur deficits and losses on their income and expenditure account one year and surpluses in others. There may be legitimate reasons for that. However, a primary care trust, in its proper role as a commissioner of services, receives a given amount of resources and has a responsibility not to spend more than the resources that are voted to it through the House. The discipline of RAB should therefore apply to primary care trusts but not to businesses that are trying to provide services year on year.

Mr. Barron: We need to extend the debate. I shall say a little about what the Committee found in some health communities, which told us, “Last year, we were the overspenders and we were the acute sector, so we’ll move it to the primary sector this year and they can be overspenders.” That is an unhealthy state of affairs and I shall mention it briefly again later. We cannot say that RAB is all right for one sector of the NHS but not another.

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