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Written Ministerial Statements

Thursday 20 November 2008

Business, Enterprise and Regulatory Reform

Transport, Telecommunications and Energy Council

The Minister for Trade, Investment and Consumer Affairs (Mr. Gareth Thomas): Today my noble Friend the Parliamentary Under-Secretary of State for Communications, Technology and Broadcasting made the following statement:

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European Union Emissions Trading Scheme

The Exchequer Secretary to the Treasury (Angela Eagle): Yesterday morning the Government successfully held the UK’s first auction of carbon allowances as part of phase II of the EU’s emissions trading scheme (ETS). The auction was also the first of its kind to take place in Europe, demonstrating the UK’s continuing leadership in the battle against dangerous climate change. Four million allowances were offered for sale and sold at a total value of £54 million excluding VAT, or £13.60 per allowance. The auction was over four times oversubscribed demonstrating that the auction was competitive and that it attracted a significant amount of market interest.

The ETS puts a cap on emissions from around 12,000 installations throughout the EU—including in the energy and heavy industrial sectors, which are collectively responsible for close to half of the EU’s emissions of carbon dioxide. Any of these installations that exceed its emissions cap will need to purchase the appropriate number of allowances.

Through auctions and the creation of a secondary market for allowances, the ETS is sending clear price signals. The carbon price will encourage Governments, businesses and individuals to factor the costs of emissions into their spending and investment decisions. A price for carbon creates an incentive to find products and processes that produce less carbon to achieve the same outcomes, which in turn encourages investment in the research and development of low carbon technologies.

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Next month’s international climate change negotiations in Poznan present an opportunity for Governments around the world to consider innovative approaches like the ETS as means to counter the dangers of climate change. Norway, Liechtenstein and Iceland have already joined the ETS and work on other “cap and trade” schemes is under way in the USA, Australia, New Zealand, and Japan. The ETS is well positioned to form the basis of a global carbon market in the future.

During 2009 the Government plan to auction a further 25 million allowances. Dates for future auctions will be announced in due course.

Children, Schools and Families

Learner Support Schemes

The Minister for Schools and Learners (Jim Knight): Ensuring learners are able to access education and training post-16 is a key priority for this Government. I would like to update the House on the current situation in regard to the delivery of Education Maintenance Allowances (EMAs).

There have been processing and other related problems since Liberata won the contract to deliver helpline, assessment and payment functions for EMA and other learner support schemes in July 2007. The Learning and Skills Council (LSC) has been closely monitoring the situation and has been regularly providing me with updates, which I have shared with the Children, Schools and Families Select Committee.

As of Tuesday 18 November, 794,655 applications—237,826 more than 8 October, the date of my previous letter—have been processed. This has resulted in 485,396 young people—201,516 more than at that time—receiving notifications that they are entitled to EMAs, which means they can begin claiming the allowance. There are currently 12,016 applications in the process of being finalised—down from 111,000 on 8 October.

Despite this progress, the LSC’s view has been that in order to preserve the best interests of learners, a change in contractor was necessary. The LSC has been in talks with Liberata about the future of the contract for over four weeks and yesterday informed me that they intend to discontinue the Liberata contract. I have been clear from the outset that these delays have been totally unacceptable and I therefore fully back the LSC’s decision to change contractor to Capita.

The transfer of the EMA helpline, processing and payment service from Liberata to Capita will take effect from Friday 28 November. With effect from that date, Capita will bring in a new senior management team to oversee the staff and operations in Coventry, Manchester and Darlington. The transfer will place us in a stronger position to fix the helpline and processing problems, enabling us to improve the future service for young people, colleges and learning providers.

The migration of the learner support service programme contract from Liberata will have resulted in Liberata losing future revenues of over £60 million over the remaining term of the contract. In addition, in addressing the issues caused by the failure of their proposed IT system, Liberata rightly took the decision to employ significant numbers of additional temporary staff to deal with the backlog in applications. In doing so they
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have incurred extraordinary additional costs and it has been judged inappropriate to impose further additional penalties.

In order to ensure a smooth and orderly transition to a new service, the LSC has secured the transfer of the interim payment service to the new service provider and the transfer of physical IT assets and applications software at a cost of £4 million. The cost of this is significantly lower than the extraordinary additional costs which Liberata has incurred.

These arrangements are within parameters approved by the Permanent Secretary in his principal accounting officer role, and by HM Treasury. The Permanent Secretary, in his principal accounting officer role, has reassured me that this agreement represents value for money for the tax payer and protects the interests of learners.

The payments being made to young people will continue and during the transfer period, outstanding applications will continue to be processed. As I have made clear before, all delayed payments will be backdated in full.

Throughout this period of unacceptable delays, our main priority has been to ensure learners get their payments. I am confident that the new arrangements the LSC have put in place are the best way to improve EMA delivery.

I am placing in the Library of the House copies of correspondence from me to the Chairman of the Children, Schools and Families Select Committee, to me from Mark Haysom, Chief Executive of the LSC, as well as the relevant statements from Liberata, the LSC and the Department.

Home Department

Money Laundering and Terrorist Financing

The Parliamentary Under-Secretary of State for the Home Department (Mr. Alan Campbell): I have placed in the Library of the House the second annual report to Home Office and HM Treasury Ministers on the Suspicious Activity Reporting (SAR) regime to combat money laundering and terrorist financing. The reporting system is a key element in the United Kingdom’s defences against money laundering and terrorist financing.

The report has been prepared by multi-agency Committee, under the chairmanship of the Serious Organised Crime Agency (SOCA), which includes the financial services sector, police, other law enforcement agencies, and the Financial Services Authority. As the report notes, awareness of the value of financial intelligence in fighting crime and countering terrorism continues to rise across the international community.

The Government welcome the steady progress that SOCA and the other participants have made to ensure that the reporting system is operating so as to help deter, detect and disrupt those involved in these crimes and in holding them to account. It is important to build on this progress by further improvements, including in the use made of the reports by law enforcement agencies.

The overall goal is a SARs system that addresses the threats to the UK from crime and terrorism, contributes to the reduction of harm and the recovery of the proceeds of crime while minimising the costs of compliance to industry and others.

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Minorirty Ethnic Recruitment, Retention and Progression (Police Service)

The Secretary of State for the Home Department (Jacqui Smith): On 6 October, I asked the Minister for Policing, Security and Community Safety to undertake an assessment of minority ethnic recruitment, retention and progression nationally across the police service. This assessment gave us the opportunity to consider the recent cases as well as look to the future of minority ethnic recruitment, retention and progression when current race employment targets for the police service, set in 1999, come to an end in 2009.

The assessment is now complete and I am grateful to the Association of Chief Police Officers (ACPO), the Association of Police Authorities (APA), police staff associations, the national police diversity staff support associations, the Post-Lawrence Project Group—including Doreen Lawrence—and others who contributed to this work.

The assessment confirms that the police service has come a long way and made good progress since the Stephen Lawrence Inquiry report (1999) by Sir William Macpherson and the Secret Policeman Programme (2003). Over the years we have seen positive changes in relation to race equality which have also benefited other minority groups. These positive changes have been due to the commitment of many police officers and police staff and prominent community members such as Doreen Lawrence and other independent chairs of the Post-Lawrence Project Groups. It is important to emphasise that we are not starting from “point zero” on equality. A lot has been achieved but we should not be complacent and recognise that we still have a lot to do.

Copies of the assessment paper will be placed in the Library of the House today.

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