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Written Ministerial Statements

Tuesday 5 February 2008


ECOFIN: 22 January 2008

The Chancellor of the Exchequer (Mr. Alistair Darling): The Economic and Financial Affairs Council was held in Brussels on 22 January 2008. The Exchequer Secretary to the Treasury attended for the UK. The items on the agenda were as follows:

Presidency Work Programme

The Slovenian presidency of the Council presented its proposed work programme for ECOFIN in the first half of 2008, which was followed by an exchange of views. As part of the agreed three-presidency approach, the Slovenian presidency will take forward the common priorities started under the German and Portuguese presidencies. These are: ensuring efficient and effective management of economic policy; taking further steps toward the completion of the internal market; and improving the quality of the public finances. In addition, the Slovenian presidency will address economic reform issues ahead of the 2008 spring European Council, and financial stability issues following recent developments in financial markets. The UK supports the proposed work programme.

Introduction of the Euro in Cyprus and Malta

Ministers exchanged views on the introduction of the euro in Cyprus and Malta on 1 January 2008, following presentations from the European Commission and the Cypriot and Maltese delegations. The European Commission will continue to monitor progress in these countries, and will publish a report on the changeover in Cyprus and Malta in the near future.

Preparation of the European Council (13-14 March 2008)

i)The Next Three-year Cycle: Strategic report, Broad Economic Policy Guidelines 2008-10, Country-Specific Integrated Recommendations, and the Community Lisbon Programme.

Ministers held an orientation debate on a range of documents related to the Lisbon strategy for growth and jobs. These documents included the Commission’s recently published strategic report reviewing the latest three year-cycle of the strategy, proposals for broad economic policy guidelines, country specific recommendations and the Community Lisbon programme.

Ministers agreed that the existing priorities of the strategy (knowledge and innovation, employment, the business environment, and energy and climate change) remained valid and that no fundamental overhaul of the guidelines was required. Member states should therefore prioritise the implementation of the agreed
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reforms. March ECOFIN will return to these issues and will prepare a report on these documents for the spring European Council.

ii) Single Market Review

The Council agreed a set of conclusions on the single market review. Ministers agreed priority areas for action, which include the rapid implementation of the services directive, efforts to liberalise network industries and promoting the free movement of knowledge and innovation. The UK welcomes the focus on these areas, which should help build a market-based, flexible, and outward facing single market. These conclusions will inform discussions at the spring European Council.

iii) Contribution to the Spring European Council Conclusions: Key Issues Paper

Ministers discussed the broad themes of a key issues paper, which will form ECOFIN’s contribution to the spring European Council. Drafting of the paper will now continue at official level through the Economic Policy Committee (EPC) and Economic and Finance Committee (EFC). Ministers will adopt a final version of this paper at the February ECOFIN.

Single Euro Payments Area

Council agreed a set of conclusions on the single euro payments area (SEPA), an initiative led by the EU banking industry to develop pan-European payment schemes for payments in euros. Although the UK is not a member of the Eurozone, it is supportive of the ongoing work to deliver SEPA, which it hopes will bring real benefits for business and consumers.

Business, Enterprise and Regulatory Reform

Government Response to the European Commission Cohesion Policy (Consultation)

The Minister for Employment Relations and Postal Affairs (Mr. Pat McFadden): On 30 January 2008 the Secretary of State for Business, Enterprise and Regulatory Reform submitted the Government’s response to the European Commission’s consultation on the future of cohesion policy. The response was drawn up in consultation with other Government Departments and the devolved Administrations.

In the former Minister for Competitiveness’ written statement to Parliament of 27 November 2007, Official Report, column 9WS, he outlined the approach the Government were taking to the response: in particular, that they would focus on the aims of cohesion policy and the most efficient mechanisms for achieving these aims. The response is consistent with this approach. It does not pre-empt the Government’s view on the separate Commission consultation on the EU budget review. The response maintains the policy direction set out in “A Modern Regional Policy for the United Kingdom” (2003), taking account of the policy statements in Global Europe, in particular, that there should in the future be “a significant increase in the percentage of structural funds to poorer member states”.

Due to the scope of the questions asked in the consultation itself, the Government response is formed
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of two parts. A covering letter is used to raise issues in relation to the debate on the future of cohesion policy that the Commission’s questions do not address. This is followed by responses to each of the questions.

The letter starts by putting cohesion policy into context, as established in the Treaty; that is, it contributes towards the overall aims of the European Union by addressing disparities in development between regions. The best way to address these disparities is through the Lisbon and Gothenburg agendas; supporting the sustainable development of jobs and growth noting that cohesion policy is not the only means of addressing this agenda. These themes are further developed in the answers to the specific questions.

The letter then states that our response focuses on the shared aims of cohesion policy and that reform of the structural funds should be given full consideration as part of the EC budget review. It highlights the three principles upon which debate on the review should be based, as stated in Global Europe, and notes that in line with these principles a priority for reform will be “a significant increase in the percentage of structural funds to poorer member states” but goes on to acknowledge that the impact of significant changes to funding will need to be considered.

Finally, the point is made that the debate on the future of cohesion policy is wider than the questions raised in the consultation and provide examples of other questions that could be considered.

The consultation questions themselves are divided into three themes. The first set of questions asks how far cohesion policy is adapted to addressing the challenges of globalisation, climate and demographic change.

The Government response is that cohesion policy should be driven by the integrated guidelines for jobs and growth and the national reform programmes (NRPs). The challenges facing European regions are not new and are already being addressed at a European, national, regional and local level. Cohesion policy should remain focused on achieving sustainable jobs and growth.

The second set of questions asks how cohesion policy can further develop an integrated and more flexible approach to growth and jobs in the context of these new challenges.

Our response advocates a strategic approach to cohesion policy directly linked to the integrated guidelines and NRPs. The link to the NRPs should provide the flexibility for cohesion policy to add value to the policies relevant to each member state and within this framework allow regions to focus on their specific priorities.

The final set of questions asks how well suited the existing policy management system would be to deliver the requirements identified in the response to the previous set of questions.

In responding we reiterate the approach set out to the previous set of questions and call for simplification and proportionality in the financial management systems. The benefits of co-operation activities are also stressed, as is the need for proper financial management.

As well as being published on the European Commission’s website this response and covering letter will be made available to the public through the Business, Enterprise and Regulatory Reform website. The response has also been brought to the attention of
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a wide variety of UK stakeholders, Members of the European Parliament and the appropriate Parliamentary Scrutiny Committees. In addition a copy of the response and the covering letter will be placed in the Libraries of both Houses.

Children, Schools and Families

“Staying Safe Action Plan”

The Parliamentary Under-Secretary of State for Children, Schools and Families (Kevin Brennan): I am today informing Parliament about the publication of the “Staying Safe Action Plan”. This is a cross-Government document setting out work to be taken forward over the period 2008-11 to improve children and young people’s safety.

This action plan has been developed across Government and demonstrates our collective commitment to keeping children and young people safe.

I will place a copy of the document in the Libraries of both Houses.

The “Staying Safe Action Plan” is the Government response to the “Staying Safe” consultation, which ran from 18 July to 31 October 2007. During the consultation we received 1,039 responses from practitioners, parents, children, young people and the general public and held regional events with practitioners, as well as discussion groups with parents, children and members of the general public.

The consultation generated a wide ranging debate about children and young people’s safety and the key messages of the “Staying Safe Action Plan” are:

The action plan sets out commitments from across Government for work to keep children and young people safe. The effectiveness of these policies over the CSR period 2008-11 will be monitored and evaluated by PSA 13 (improve children and young people’s safety).


DARA's Rotary Wing and Components Business

The Minister for the Armed Forces (Mr. Bob Ainsworth): On the 25 July 2007, I announced that Vector Aerospace had been selected as the preferred bidder for the purchase of the DARA Rotary Wing and Components businesses at Fleetlands in Hampshire and Almondbank in Perthshire.

Following a period of extended consultation with a wide range of interested parties including local MPs and trade unions and successful negotiations with the preferred bidder, I am now able to announce sale of these businesses to Vector Aerospace for £17 million. Vector Aerospace has also legally undertaken to retain the operational capability currently provided in the
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UK and has given a full commitment to meet all employment and pension protections. Throughout the sale process, it has remained our priority to secure the best decision for defence. First and foremost is the support we provide to our armed forces who are so often involved in difficult and dangerous operations. Secondly, our responsibility also extends to securing the skills that exist currently in DARA for our longer-term requirements while giving the loyal and dedicated DARA employees a secure future. These are objectives that my predecessor set out in November 2005 as part of our logistics transformation programme and that are wholly consistent with the defence industrial strategy, which has seen our key industry partners working with us to deliver operational capability to the front line on time and to budget.

On current plans, these businesses have a finite life; privatisation could develop the business further, with the best chance of winning a share of new work in a subcontractor role via the through life contracts we are increasingly placing with our key industry partners, as well as other work outside the MOD. It is therefore in the best interests of our colleagues on the front line and the DARA employees that we secure the best long-term solution, which allows the skills, expertise and on-shore capability to be retained for our future needs.

Sale to Vector Aerospace not only offers the opportunity for investment and growth but also provides us with operational certainty on a vitally important maintenance service that has every chance of improving under new ownership. Vector Aerospace has a demonstrable track record of military aviation support both in the UK and North America and more importantly, can sustain capability to surge and flex to meet defence operational requirements. Sale to Vector Aerospace is also supported by our key rotary wing industry partners, Boeing and AgustaWestland, who recognise the important role Vector Aerospace will have in their future contracting arrangements.

I must add that before reaching this decision, we have taken into account the views, concerns and contributions from hon. Members, trade union officials at every level and many others who have contributed to the debate on sale. I can confirm that we will continue to maintain a dialogue with trade union and employees through to the completion of the sale. This announcement gives the workforce clarity on this important and sensitive issue.

Finally, I want to pay tribute to the excellence and professionalism of the DARA employees and their contribution in supporting those in our armed forces who rely on their skill and dedication which is invaluable and recognised throughout the world.

Following completion of legal and regulatory processes, and in particular the need for Vector Aerospace to obtain a final Government Actuaries Department certificate for its broadly comparable pension scheme, it is expected that the formal transfer of ownership to Vector Aerospace will conclude shortly.

US Emergency Donor Blood Transfusions

The Parliamentary Under-Secretary of State for Defence (Derek Twigg): As the Secretary of State for Defence informed the House on 10 January, a small
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number of UK service personnel who deployed to Iraq and Afghanistan in recent years have received life-saving emergency transfusions of US blood. We had identified from US and UK records that 18 of these UK service casualties might have received blood or blood products from US emergency donors at their field hospitals where samples from the donor might not have had a valid retrospective test. There was no evidence that a blood-borne disease had been transmitted from a US donor to a UK service recipient, but there was a small risk for these individuals that a blood-borne disease was transferred without being detected. We therefore commenced contacting these individuals on 20 December last year to offer retrospective tests for these few individuals as a sensible reassurance measure.

All UK service personnel who might be affected (or if appropriate their next of kin) were contacted personally by their own military or civilian GP. The precise means of communicating was decided by each individual GP, since they are the only persons able to balance all the factors affecting their patients’ situation. In some cases, initial contact will not have been made face-to-face, whether because of the patient’s location or other factors. I am satisfied that GPs acted appropriately in difficult circumstances and with their patients’ welfare uppermost in their thoughts. However, by 11 January, all 18 patients (or if appropriate their next of kin) had been counselled on the advisability of having their blood tested and offered the necessary tests. It is of course the patient’s right to decide whether to take any such test.

An individual’s tests will take two to three weeks to process. However, the blood samples should not be taken until a period of some months have elapsed since the transfusion took place. This means that not all the individuals in the group of 18 patients have yet had their tests completed.

Patients have an absolute right to medical confidentiality either from direct disclosure of their personal information or from indirect disclosure resulting from the release of wider information. This means that in order to protect patient confidentiality in such a small group, the Department is unable to reveal any further details, on either an individual or group basis, of the number of those contacted who elected to take the tests offered. This also includes revealing details of the results of such tests, whether positive or negative, unless explicit and informed consent is given by the patient concerned. Indeed, the Department itself has no right to know an individual’s test results without the patient’s explicit consent.

MOD fully recognises the distress this will have caused individuals. We continue to offer help and support to those to whom we have offered retrospective testing, and to those others who have become concerned as a result of the media coverage.

Any blood transfusion carries some degree of risk. We and our coalition partners are committed to minimising those risks. The crucial point remains that an emergency blood transfusion from donors on or near the battlefield can be—and in some cases certainly has been—the only way of saving lives of gravely wounded UK personnel.

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