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My hon. Friend the Member for Thurrock (Andrew Mackinlay) made an extremely good contribution on landfill, and on the prospect of a new Thames barrier to mitigate flooding risks. He also spoke about the Thames Gateway in principle, as well as about his local shopping centre. He clearly has views on the way in which the gateway has been set up, but I cannot stray into them because they are not in my ministerial area. I will say,
however, that major progress has been made in the development of the Thames Gateway. More than 42,000 new homes were built in the gateway between 2001 and 2007. The number of jobs created in the gateway has grown by 10 per cent. between 2001 and 2006, compared with an average 4 per cent. increase in England as a whole. The Government have never believed that a top-down centralised structure is right for the gateway, which is an area 40 miles in length with a population of 1.5 million and dozens of different towns and communities. However, my hon. Friend has robust views on the matter and I am sure he will continue to express them to the appropriate Ministers. I undertake to write to the appropriate Minister about his retail park, which is clearly bugging him greatly; I would like to find out whether I can do anything to assist him in that.
The hon. Member for Ludlow (Mr. Dunne) has during his parliamentary career been involved in some of the same Select Committees on which I have, as a Back-Bench Member, had the privilege to serve: the Treasury Committee and the Public Accounts Committee. He is clearly enjoying himself, and he made an extremely good speech on some of the reports he has been particularly involved in. I hope he continues to enjoy his membership of the Committee as much as I did.
The hon. Gentleman made a point about hindsight and looking at things retrospectively—after the horse has bolted, so to speak. That is because the Committee looks at value-for-money issues. If the PAC wishes to change its remit, that is a matter for the House. The Committee would have to develop its views on that, and the House would then have to decide whether to agree to the change. I agree with the hon. Gentleman that it is important that accounting officers are questioned—my hon. Friend the Member for Great Grimsby made this point, too—as the Committee has never concerned itself with policy, but deals with value for money and efficiency. That is an extremely important part of its focus.
The hon. Member for Putney (Justine Greening) was right to highlight the strengths of the Committee’s cross-party structure and the holistic approach it takes, and the importance of the focus on value for money and efficiency savings, which are at the heart of its work.
The Chairman, the hon. Member for Gainsborough, drew our attention to the tax credits system. Tax credits provide support for 6 million families and take-up is now at unprecedented levels. The system has helped lift 600,000 people out of poverty since 1998-99. Figures published in March 2008 show that in 2005-06 take-up of the child tax credit was 82 per cent. with more than 90 per cent. of allocated money being claimed. Importantly, for those on incomes of less than £10,000, take-up is now at 96 per cent. For lone parents, it is now up to 95 per cent. Furthermore, Her Majesty’s Revenue and Customs has established the tax credits transformation programme to improve the services that families receive. That includes a new service that allows couples whose relationship has broken down to initiate a new single claim by making a single telephone call.
We have also improved performance, so that far fewer overpayments are caused by processing or software error. Accuracy in processing and calculating awards has risen from 78.6 per cent. in 2003-04 to about 97 per cent. in 2006-07. HMRC has revised its code of practice on recovering overpayments, replacing the reasonable belief test with a clearer test that will set out customers’ responsibilities for checking factual information. In effect, there is a contract of responsibility. For instance, the recipient is expected to check that the amount going into their bank account matches the amount in the award notice. As before, they will not be expected to check the calculation; that will be a relief to all Members in terms of our constituency surgery work. If there is an official error and customers meet their responsibilities, the overpayment should be written off. The change will mean a fairer balance of responsibilities between the customer and HMRC. The Government regret the amount of error and fraud. The clear intention is for them to be reduced. HMRC will set targets to reflect that intention during this year.
Officials are working hard to publish at the earliest opportunity the Treasury minutes on tax credits that Members are awaiting. Although the delay is regrettable, I should add in mitigation that the record for meeting deadlines for such minutes is extremely good.
Various hon. Members have mentioned the Government’s efficiency programme. The Committee has, on several occasions, rightly focused on this ambitious programme and I welcome its support for what we are trying to achieve. I am, of course, aware of the Committee’s concerns about the robustness of the efficiency gains identified by the Government. Hon. Members are of course right that the savings claimed need to be genuine and credible. However, we should not overlook the National Audit Office’s view that
“projects across the public sector are making significant improvements to the efficiency of public services”.
I hope that hon. Members on both sides of the House will welcome that view. Nor should we ignore the fact that the programme is the largest concerted and continuous efficiency drive embarked upon by any Government in modern times.
By December last year, we had achieved some £23 billion of efficiency gains. Our target for the current comprehensive spending review period up to 2010-11 is to achieve another £30 billion of savings. We have already seen some 78,000 net reductions in staff numbers as well as 12,600 posts reallocated to the front line. We are incredibly proud of the dedication and professionalism shown by civil servants across the country who have accepted the message that the Government need to work smarter and faster to deliver public services.
We are determined to seize opportunities to provide taxpayers with genuine value for money wherever possible. We are also on target to reach our target of relocating some 20,000 jobs from London and the south-east by 2010 and, by the end of last year, had already moved 15,700 posts to the rest of the United Kingdom. That good progress has strengthened local economies and enabled the civil service to tap into a broader pool of talented recruits from across our country. All nations and regions in the UK have benefited from these moves, with 3,275 posts moving to the north-west, 3,259 posts moving to Wales and 3,268 posts moving to Yorkshire and the Humber.
Thirdly, I shall turn to financial accountability. Full and open financial transparency is an essential and defining characteristic of a modern parliamentary democracy. The PAC, supported by the NAO, continues to be at the heart of the scrutiny process in our democracy and its unstinting and challenging examination of the use of scarce public resources contributes to our story of accountability in the United Kingdom.
The hon. Member for South Norfolk gave a dizzying list of PAC equivalents that he had managed to visit the world over on his travels, but pointed out that the UK version is still a world leader. However, Parliament and Government cannot afford to be complacent about financial scrutiny. This point was clearly recognised in the Liaison Committee’s report, “Parliament and Government Finance—Financial Scrutiny”, which was published just over three weeks ago, on 21 April, and which the Government welcome.
We are particularly grateful for the Liaison Committee’s support for what has become known as our alignment project, which the Prime Minister announced last July. The project aims to bring all the Government’s publication of information about public spending into a common format. This comprises public spending plans, parliamentary estimates and published resource accounts. Implementation of the alignment project will make a significant contribution to greater transparency and accountability and will allow Parliament and the public to track more readily Government spending from planning and budgeting stages right through to actual out-turn. As a result, Parliament will enjoy greater financial control over departmental budgets and, at the same time, have clearer and better financial information on the efficacy of planned public spending.
The PAC must share some of the credit for these reforms, as is evidenced in its welcome paper, “Improving Financial Scrutiny”, published as far back as July 2006. Hon. Members will recall that my predecessor as Financial Secretary promised to work with Parliament in bringing about change in the public interest. The alignment project clearly demonstrates our commitment to this worthy ambition and the Government continue to look forward to working with Parliament to achieve our common goals.
Turning from projects, I should like to reflect on the developments under way to modernise the NAO’s governance structures—another matter referred to by the hon. Member for Gainsborough. Members have already welcomed the Public Accounts Commission’s 15th report on the governance of the NAO. I should like to restate the Government’s support for those reforms. We support the Public Accounts Commission’s objective in establishing systems of governance and internal control at the NAO that are consistent with best practice but that do not fetter its ability to form completely independent judgments.
The current governance arrangements for the NAO and the Comptroller and Auditor General give priority to independence at the expense of good governance. The Government believe that the Public Accounts Commission’s report strikes the right balance between the Comptroller and Auditor General’s independence and the governance expected of an organisation that operates in the 21st century, rather than perhaps the 18th or 19th centuries. The new governance arrangements will give the Comptroller and Auditor General and the
NAO the authority that they need for the important work that they do and spur them to improved performance. As hon. Members will know, the Prime Minister agreed that such provisions would be included in the Constitutional Renewal Bill, which has now started its pre-legislative scrutiny under a Joint Committee. It is important that Parliament and the Government work in harmony towards our shared objectives.
I understand the hon. Gentleman’s enthusiasm for bringing about the agreed new governance arrangements at the NAO—a point that he made very powerfully in his speech today. However, the important thing is to settle on a robust governance structure and to ensure that it commands the public support that it must have for credibility.
I should like to thank Tim Burr not only for agreeing to serve as the Comptroller and Auditor General until the reforms are completed and in place, but also for presiding over a seamless transition from the previous regime. That reflects his outstanding ability as a public servant. He is clearly demonstrating his ability to preside over the NAO in these times and to prepare it for the new governance arrangements.
It has been a pleasure to listen to the debate today, and I congratulate all hon. Members on their contributions. Before I sit down, I should like to add my voice to those who have wished the outgoing Comptroller and Auditor General, Sir John Bourn, under whom I served two terms as a Back-Bench member of the Public Accounts Committee, a long and happy retirement.
5.2 pm
Mr. Leigh: If I may crave your indulgence, Mr. Deputy Speaker, just for three or four minutes, I shall thank all the hon. Members who have taken part in the debate, particularly the right hon. Member for Islwyn (Mr. Touhig), who sat through the entire debate and backed up what I and others have said about dementia. He made a very moving speech, and if people think that our work is rather dry and does not concern real people and that it is just about accounts, I hope that they will read and listen to his speech. I seriously think that that report is one of the most important things that we have done this year, and it will make a real difference to millions of people’s lives.
On a slightly lighter note, we much enjoyed the speech made by the hon. Member for Southport (Dr. Pugh), who referred to us as some kind of pop group. Seriously, I think that there is a need for the public sector to take a few hints from what is going on in the private sector. We perhaps need to engage the media more in what we do. Perhaps there should be a public sector version of “The Apprentice”, in which the hon. Member for Thurrock (Andrew Mackinlay) or perhaps the hon. Member for Great Grimsby (Mr. Mitchell) could play the part of Sir Alan Sugar and say to some of those civil servants, “You’re fired.”
Andrew Mackinlay: You mean the nice guy.
Mr. Leigh:
Indeed. Of course, that leads me straight on to the hon. Member for Great Grimsby, who brought us down to reality in a typically robust, wide-ranging speech. He reminded us again not only that much of our work is about helping the lives of ordinary people,
but that many of the problems that we face in this country relate to our excellent civil service gold-plating European directives. We saw that particularly with the Rural Payments Agency.
My hon. Friend the Member for South Norfolk (Mr. Bacon) gave a virtuoso performance. The temptation in our debates is always to read out our speeches, because we want to get everything in and be serious, but he did not read his speech at all; he just produced about 20 reports and used them brilliantly as a prop. After what he has said today, we have to try to modernise our procedures in this debate and ensure that they are up to date. The concept of having to stick rigidly to matters on which there has been a Treasury minute is outmoded. It was outrageous that yesterday, when Postcomm was before the Committee, its representatives did not once say that Postcomm was to come out with a major announcement two hours after appearing before us, the senior Committee of Parliament. It is unbelievable. It is perhaps even more wrong that we cannot have a proper debate about that today.
Of course I thank the hon. Member for Thurrock, not least because he is not a member of the Committee. It is important that these debates do not become a Committee love-in, in which we all pat ourselves on the shoulder. We want to bring in people who are not Committee members. His constituency was the common thread in his comments on all the reports that he mentioned, including the reports on the Thames Gateway, flood alleviation and landfill; I thought that that was an excellent way to go about making his speech.
I thank my hon. Friend the Member for Ludlow (Mr. Dunne) for hot-footing it back from Crewe and
Nantwich—I know that he has spent a lot of time there recently—to grace the Conservative Benches in his typically diligent way. My hon. Friend the Member for Putney (Justine Greening), the Opposition spokesman, is a newcomer to our debates. She put her finger on it: the point of our reports is that they are based on evidence and fact, as the right hon. Member for Swansea, West (Mr. Williams), who is the Father of the House and the longest-serving member of the Committee, always says. Our reports are only as good as the facts on which they are based, and that is why it was such an appalling let-down when the Department for Transport gave us incorrect figures on motorcycle evasion. We never want to see that happen again. It destroys the credibility of the Committee, and of Parliament, when we are given wrong information.
Lastly, may I thank the Exchequer Secretary to the Treasury for a typically witty, charming tribute to our work? Quite rightly, she set us right a bit when we perhaps strayed into criticism of the Government on tax credits or prescriptions. As always, the debate was not a party political affair. It genuinely sought to shed light on the workings of Government, and not to generate only heat. I thank the House for its attendance.
That this House takes note of the 41st and the 42nd and the 46th to the 65th Reports of the Committee of Public Accounts of Session 2006-07, and of the Treasury Minutes on these Reports (Cm 7275, 7276 and 7322); and of the 1st to the 4th, the 6th and the 9th to the 13th Reports of the Committee of Session 2007-08, and of the Treasury Minutes on these Reports (Cm 7323 and 7364).
Boiler Room Fraud
Motion made, and Question proposed, That this House do now adjourn. —[Mr. Khan.]
5.7 pm
Mr. Nigel Evans (Ribble Valley) (Con): I am delighted to have this opportunity to raise an issue that should be of interest to everyone in the House, although I suspect that many Members do not even know that the scam I shall describe is going on. There are people who are ignorant of the fact that they are victims of boiler room fraud. I am delighted that today’s business finished a little early, because it gives the Solicitor-General and me the luxury of a little more time to elaborate, to explore the issue fully, and to identify what we all ought to do to ensure that people are properly protected. I am chairman of the all-party identity fraud group; that is how the scam was brought to my attention. I am grateful to see that the Solicitor-General is present. That gives an important signal that the Government intend to take the issue very seriously.
In the past few days, I have mentioned the debate to a number of MPs, and others have seen it announced on the Annunciator. Some of them thought that it had something to do with plumbing. They had not the faintest idea what boiler room fraud was. They asked, “What’s that all about, then, Nigel?” When I explained it to them, they took it very seriously. They went white when they realised the scale of the problem.
Boiler room fraud is a big crime, yet not many people know about it. The police have called it the biggest fraud threat to households. It is even bigger than credit card fraud. The estimated loss last year was more than £500 million. One estimate puts the figure close to £1 billion. The fact is that nobody really knows what the top-level figure is, because, as I said earlier, not everybody involved knows that they are a victim.
Boiler room fraud is the name given to share investment scams—mostly share investment scams—where crooks posing as brokers use high pressure marketing techniques to sell investors shares that turn out to be worthless. This usually happens over the telephone, and usually the victims are cold-called—they receive calls that they have not initiated. The shares might be shares in real companies, but they are sold above the market price and turn out to be highly illiquid, preventing the investor from selling them on, but as often as not, investors are sold shares in companies that do not even exist.
The criminals will do anything to part victims from their money, including lying, cheating and threatening. They are persistent and they are ruthless. The conmen who operate the boiler rooms try to locate themselves beyond the reach of UK law enforcement. Many of the boiler rooms targeting the UK appear to be located in Spain. The police estimate there are around 400 boiler rooms operating in Spain, employing over 600 people. They earn big money. I should not use the word “earn”—they steal big money.
Other popular locations for boiler rooms are the USA, Dubai, Berlin, France—they can operate from anywhere. In this era of the telephone, fax and email, a boiler room can be located anywhere in the world, and tracking them down can be difficult, because they are dishonest about their true location.
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