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3 Jun 2008 : Column 651

John Bercow: It might prompt the Minister, although I suspect that the answer is now being provided to him, if I tell him that his noble Friend in the other place promised that it would be subject to the affirmative procedure, which, for the benefit of those listening to our proceedings, means that there would be an element of parliamentary scrutiny. He is not going to renege on that, is he?

Mr. Plaskitt: No, he is not; he will confirm what my noble Friend said in the other place. There is plenty of consistency.

Mr. Heald: Even now, the Minister has not finally made up his mind about whether it should be a Crown body. The point about amendment No. 2 is that he will review the matter again. We started off with an arm’s length body without civil servants. Then we had the halfway house of having civil servants, but with it still being an arm’s length body. Now the Government are agreeing to have another look at it in three years. Not only have they dithered, they propose to continue dithering for another three years.

Mr. Plaskitt: This is getting a bit repetitive. Let me say again that there is no dithering. The fundamental objective, namely the non-departmental public status and all the advantages that flow from that, is in place, unaltered and unamended by anything that we have done, save for the difference we have made in respect of the staff who work for the existing agency, who were concerned about their loss of civil service status. We have been able to retain that. That is the only thing that has changed; it is not fundamental in terms of the purpose of the Bill and has been accommodated within the Bill’s essential objectives. It is subject to review and I will come on to explain why that is.

Mrs. Nadine Dorries (Mid-Bedfordshire) (Con): Has the dithering, or non-dithering, had any affect on staff morale?

Mr. Plaskitt: There has been no dithering. Let me do this again. We introduced the NDPB proposal, which was welcomed by the staff of the agency who support the Bill, approve of the direction we are going in and are looking forward to working for the new organisation. The one thing they said was, “This means that we will lose our civil service status.” Initially, it did, but we considered what they said and have been able to restore their civil service status. That has enhanced the staff’s morale, and if the hon. Lady cares to go to one of the CSA offices and asks for herself, she will find that that is the case.

Staff to whom I have spoken—I have spoken to many hundreds—support the Bill and the proposed change. They are very pleased at the decision we were able to make on the retention of their civil service status, so I can tell the House that the effect of the Bill and the subsequent change we made on status have substantially enhanced staff morale.

As I made clear during earlier stages of the Bill’s passage—I am pleased to note that Opposition Members have echoed me on this—the difficulties experienced by the agency in the past have resulted from the failure of current policy and structure, not as
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a result of any action or inaction by the agency’s staff, who remain its most important resource. Throughout the history of the agency, staff have time and again proved to be dedicated to providing the best service to all clients, both parents with care and non-resident parents. The staff of the agency are absolutely essential to the success of these reforms and, like all of us, what they really want is to be given the right tools to enable them simply to get on with the job of collecting the maintenance and seeing it flow to children.

As we developed our proposals for reform and as I have said before, it became increasingly clear that the agency’s staff did have concerns about the loss of civil service status. Perceptions are important, and it was in no one’s interests for us to put our reforms at risk through unnecessarily destabilising those at the front end of delivering those important reforms. This change to a Crown body will therefore enable staff to remain civil servants, and it allows them to look forward to, rather than have concerns about, the commission’s launch.

4 pm

There are a number of amendments consequential to this change. For example, as staff will now remain civil servants, there is no need to apply the Transfer of Undertakings (Protection of Employment) Regulations 1981 and 2006, and as a result, the clause in question can now be removed. Additionally, we recognise that over time, the advantages of Crown status in general might recede, so we intend to review the commission’s status after three years. If the review concludes that Crown status is no longer necessary or advantageous, the amendments provide an order-making power to make the necessary changes, subject to affirmative procedure. However, at that point, as now, the views of the staff will be important in determining for us whether we decide to remove Crown status.

Paul Rowen (Rochdale) (LD): I would be grateful if the Minister explained what it is that he sees diminishing with time. A similar statement was made in the other place by the noble Lord McKenzie of Luton, and it was not adequately explained. Many of the same staff are still going to be employed, and if they lose Crown status, they will lose all the benefits that go with that. What safeguards is the Minister going to put in place to ensure that they do not lose out?

Mr. Plaskitt: The key point is that this is an issue specific to the commission. The reason it makes sense to review, and why I chose my words carefully regarding Crown status, is that there may well be reconsideration across government as a whole of the position of the Crown status of the bodies concerned. It is important that we recognise that a wider review is taking place that might change some of the current conditions regarding Crown status, whereby the specific arrangement made for this commission may no longer have its current advantages. It is therefore simply logical to accept that there will be a review, not specifically of this body but in the context of a wider review of Crown status. However, and as I said, just as we have listened to the staff at this point and been able to agree to their request to retain Crown status, their
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views on this matter will be critical to the commission and to us in future, at the point of review. I am happy to underline that point.

I have also taken on board the point made in Committee and in the other place that the Bill explicitly requires the commission to include in its annual report its use of outsourcing to private and voluntary social bodies, but not to public bodies. An amendment has therefore been made to put the latter requirement in the Bill. That picks up on a very sensible proposal made by the Opposition in Committee.

I believe that this group of amendments improves the Bill, and I commend it to the House.

Andrew Selous (South-West Bedfordshire) (Con): Let me start by thanking the Minister for his thanks to Opposition Members for our co-operation and scrutiny during the Bill’s passage. He is absolutely right—Members in all parts of the House are absolutely united in trying to get our system of child support right. We all recognise that it has not been right for many years, and the fault for that really lies with Members of this House present and past, and absolutely not with the staff—I agree with the Minister on that—who have done their best in difficult circumstances. Frankly, they have not had the tools to do the job, as he said. The Bill contains a pretty powerful toolkit that we on the Conservative Benches agree with in very large part.

On Lords amendment No. 1, we welcome the extra transparency provided by the inclusion in the commission’s annual report of the provision of services to CMEC by Ministers of the Crown, Government Departments or public bodies specified by the Secretary of State. Co-operation, in particular with Her Majesty’s Revenue and Customs, will be fundamental to the commission’s future success. I give the Minister notice that when we discuss the next group of amendments, I shall raise some specific issues about the current level of co-operation—or non co-operation, as sadly is the case—with HMRC, given existing legislation. I shall not expect him to have immediate answers, but I should be grateful if he got back to me.

Clearly, HMRC and the Treasury will assist CMEC, but it is not clear to me precisely what CMEC will be doing for other Departments and public bodies. Lords amendment No. 1 cuts both ways; it is about services supplied both to and by CMEC. I can clearly see that there is a case for CMEC to help HMRC should it find out details about information that is perhaps not being declared to the Revenue; that would be an entirely sensible use of CMEC staff time. However, will the Minister elaborate on whether there are any other areas in which CMEC staff will be expected to help other Departments and public bodies? After all, it is not as if CMEC’s staff will not already have enough to do and will not already have their work cut out significantly.

The Minister began by discussing Lords amendments Nos. 2 to 5, and 106 to 117. As he said, they will change the status of CMEC to that of a Crown body, and will ensure that the commission’s staff will remain as civil servants and will not have to
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change their employer. Lords amendment No. 2 introduces a new clause requiring the Secretary of State to review the status of the commission after three years, with the possibility of further reviews. I agree with the Minister that if we do not get staff morale right, we will not make a success of the commission. He rightly says that ensuring that the staff are happy and on board is essential. Given that Crown status is so important to the staff, will not reviewing it after three years, with the promise of further reviews, be unsettling to them? The Minister’s objective might have been to reassure the staff—the 10,000 individuals of whom he spoke—but having constant ongoing reviews hanging over them is a funny way of doing that.

John Penrose (Weston-super-Mare) (Con): Does my hon. Friend agree that on the basis of what the Minister has been saying, it seems that the review in three years’ time will be undertaken against a background of a Government-wide review of Crown status and perhaps the terms and conditions of employment of a great many civil servants? Surely that might poison the atmosphere and make the maintenance of staff morale between now and then, as that review starts to grind through, even harder than it might otherwise have been.

Andrew Selous: I agree with my hon. Friend, because certainty is important in employment; people want to know that their terms and conditions will not be unexpectedly changed or fundamentally reviewed. Those people joined the agency on a certain set of terms and conditions, with which they were happy, and they should have a reasonable expectation that their terms and conditions will be broadly similar in future.

At the very least, the Government’s manoeuvrings have not been perhaps as elegant as they could have been, given where the Government started from and where they have ended up. Will the Minister tell us how many other NDPBs are Crown bodies whose staff are civil servants? Is such an arrangement usual for NDPBs, or will CMEC be an isolated case? It would help the House if he let us know the answer to that.

The Minister’s colleague in another place, Lord McKenzie of Luton, who is virtually a parliamentary neighbour of mine, has said:

My next question to the Minister was what stops an executive agency from having operational flexibility, to which I do not feel that I received a full and adequate answer at the time.

Indeed, many hon. Members on both sides of the House have questioned the need to set up a new body, given that the same staff in the same buildings will carry out essentially the same tasks—or at least with the same purpose. The Minister’s argument about the need for this arm’s length body has been undone, given that it will now have Crown status and that the staff
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will be civil servants. Would it not have saved taxpayers’ money to leave CMEC as an executive agency of the Department for Work and Pensions and been much less unsettling for the staff, who have been worried by the proposed change in their status? The staff also have an ongoing worry, given that a review will take place in three years, with a promise of further reviews in the future. I hope that the Minister will address those points.

Paul Rowen: I welcome the Minister’s introductory remarks. We made several suggestions and amendments in Committee and on Report, and I am delighted that many of those proposals have found acceptance and are presented for our consideration today. Like other hon. Members, I welcome the passage of the Bill. As the Minister said, it is 12 months since we started to consider it, and the eradication of child poverty remains one of the biggest single issues that we have to tackle. Anything that ensures that parents with care get the money to which they are entitled to enable children to be brought up properly is to be welcomed. We have to accept that the House has failed singularly in the past to tackle this issue through the many guises of the CSA and various payment methods. Last year, we all welcomed what seemed to be a new start with CMEC and, we hoped, a sea change in the way in which such issues are addressed.

I welcome amendment No. 1. It is important that CMEC is transparent about its arrangements with other suppliers. We need to know if it is using debt collection agencies or if it makes arrangements with computer suppliers. In the past, the CSA’s arrangements were not as transparent as they should have been, and expectations were raised—for example, about how much debt collection agencies would collect—and then not met. I hope that with greater scrutiny—which CMEC will receive—we will be able to question suppliers and ensure the accountability to this House to which we are entitled.

On Report, the Minister said that amendments would be tabled in the other place to give CMEC Crown status. We know, because this was one of the first Bills to receive public scrutiny, that the staff want that, and it is a sensible move. However, I am not clear—other than from the Minister’s claim that there will be a general review of Crown status—why he has added the provision about a review after three years. It is quite clear that if there is a change of Government policy, not only in the Department for Work and Pensions but across the piece, that change should be made through a statement in this House that cites the reasons for it. Having gone through quite a sea change in terms of the way in which payments are collected, it is clearly unsettling for staff to face the prospect in three years’ time of the possibility of being subject yet again to a review. I am still not clear about how the proposal will affect the status and conditions of the civil servants—I understand that they will remain civil servants while they work for the Crown. I do not think that the review is helpful. The Minister needs to give a clear statement that the current status will continue.

4.15 pm

Yes, the Government might announce a change in the future. If, in three years’ time, the Minister were to announce a review of the operation of CMEC, that
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would be totally different. However, it is unhelpful to the staff to talk at this stage about merely reviewing that status after three years, because that does not help them with their task of tackling child poverty.

One subject that has not been mentioned, which was raised by my noble Friend Lord Kirkwood in the other place, is VAT. I would be grateful if the Minister confirmed that another factor in the Department’s consideration of the amendment was that VAT would be payable if the commission were a non-departmental public body, but that if it were a Crown body the £140 million would not be payable. If it seems that someone had not budgeted for that, perhaps the Minister could confirm whether it was a factor in the changes that have now been proposed?

In conclusion, I welcome the changes, but the Minister needs to reassure us about why the review in three years’ time is necessary without an overall change in Government policy, and I have not seen an announcement that that will take place. The prospect of such a review is clearly unsettling to staff and it will not help them in their difficult job of collecting the outstanding old debt as well as getting a new system up and running.

Mr. Heald: The history of the status of the commission in the Bill says a great deal about leadership, or the lack of it. We have seen a history of attempts to shirk responsibility and of dithering.

First, on the point about shirking responsibility, it was not by chance that Lord McKenzie talked about distancing from failure. The change is not an attempt to distance the new commission from failure, but an attempt by the Government to distance themselves from the work of child support bodies in this country. We know that over the years there has been a litany of failure in the Child Support Agency, which was not the fault of the staff but was, if anything, the fault of the House. The Bills that have been passed have not succeeded and the computers that have been purchased have not worked. We all know, looking at the work of the CSA, that nobody could be proud of it. There have been some improvements over time, but the fact remains that it has a sad history.

I am convinced that the Government originally set up the commission as a non-departmental public body—it was not part of the state and did not have civil servants working for it—as an attempt to distance the Government from a body that had failed in the past and from a new body that risked failure in the future. The history of child support in this country has shown that it has proved extremely difficult to get parents to pay for their children, particularly parents who do not have very high incomes.

This measure is therefore an example of an attempt to shirk responsibility. I do not think that it is right that the Government should do that. If they are performing an executive function, which is what this is all about, it should be carried out by an executive body. The staff employed by the executive body should be civil servants, as they are now. Such an attempt to pretend that the body is nothing to do with the Government is part of the “Not me, guv” culture and it is wrong. Governments should not do such things. Ministers should take responsibility for the functions that their
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Departments and their civil servants deal with, and they should not try to shirk them in the way that the Bill attempts to do.

John Bercow: My hon. Friend makes his case with his characteristic understatement. The Minister has been very courteous, but the reasoning behind any prospective change in three years’ time remains distinctly opaque. Given that any change would be announced—under the affirmative procedure, admittedly—only to a small Committee sitting upstairs, of which most Members of Parliament, let alone most members of the public, would be entirely oblivious, does my hon. Friend not think that the Government ought to state this afternoon on the Floor of the House what criteria would trigger a change?

Mr. Heald: My hon. Friend has come to a very important point—it is the third point that I want to make, but I will deal with it now—about Lords amendment No. 2, which states:

and it may apply the transfer of undertakings regulations, and so on. So if the Minister decides in three years’ time that he wants to change great chunks of the Bill, he can do so in a little Committee upstairs, as my hon. Friend says, without the full and proper scrutiny that the staff would expect, that we expect and that the British public are entitled to expect. That is a hole-in-the-corner way of doing things.

My hon. Friend thinks that I am slightly overstating my case—I got the mood of his comments—but Parliament should feel passionate about the annoying fact that such important decisions, which affect millions of people in the way that the child support arrangements do and which affect important civil service staff who are entitled to expect Ministers to stick up for them and to treat them decently, should be dealt with unconstitutionally. That is my view.

John Bercow: I certainly would not accuse my hon. Friend of overstatement at any stage. We in the Opposition may be right or we may be wrong on this point—naturally, it is in the nature of holding an opinion that we think that we are right—but does he not accept that, whatever may be said of our position on this matter, it is not motivated by party political considerations? We all entertain the very highest regard for my hon. Friend the Member for South-West Bedfordshire (Andrew Selous), who may well occupy an important post, wielding immense power with great discretion and judgment, but we do not want him to exercise this sort of Henry VIII power, and I rather doubt whether he would want to exercise it.

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