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25 Nov 2008 : Column 217WH—continued

Its involvement in information gathering and sharing was included in the annual report 2006-07.

In spite of that commitment, SOCA’s most recent report includes no mention of trafficking and no information about how many children are trafficked into the UK—dealing with that was one of SOCA’s original jobs. There are no statistics on human trafficking, and according to another parliamentary answer from the Minister, there is no intention to produce any more information. As for the number of trafficked victims found tending cannabis:

On the numbers of victims of internal human trafficking, the answer was:

In answer to the question how many children have been charged with cannabis cultivation, the response was:

It is not just a question of how to release the information, as my hon. Friend has rightly asked. Another problem is that SOCA does not have the information. Not only does it not have the information, but it has tried to bypass that fact by arguing that the UK Human Trafficking Centre in Sheffield is responsible for such matters. The Human Trafficking Centre does not have the information either, although £1.75 million will be spent this year trying to find it.

My argument is simple. I believe that SOCA has only 12 staff—it is a tiny organisation. However, if it has more staff than that, why can it not obtain the information that my hon. Friend wants, or the information that I want on human trafficking?

12.50 pm

The Minister for Security, Counter-Terrorism, Crime and Policing (Mr. Vernon Coaker): It is a delight to serve under your chairmanship, Mrs. Winterton, for what may be the first time. I thank the hon. Member for Hornchurch (James Brokenshire) for how he has worked with me to find a way through the matter. That shows that sometimes, when an issue arises through no particular fault, it is possible to work together to resolve it. I welcome this Adjournment debate as an opportunity to read some things into the record that I hope will be helpful to him. I thank him for his thanks to me and for his co-operation.

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My right hon. Friend the Member for Leicester, East (Keith Vaz), the Chair of the Select Committee on Home Affairs, is here. I believe that the chair and the director general of SOCA have given evidence before the Committee. The hon. Member for Hornchurch asked whether they had been to the Committee, and I understand that they have.

Keith Vaz (Leicester, East) (Lab): I confirm that the chair and chief executive have been before the Select Committee. We will be calling them back to consider the issues.

Mr. Coaker: That is an extremely helpful clarification. I am grateful to my right hon. Friend for making that point.

I shall make a couple of points in the few minutes available to me on the specific questions that have been raised. Notwithstanding the monetary issues that we can set against each other in determining whether the ARA did one thing or another, the importance of what it did—as well as the importance of much of the work on proceeds of crime going on in other agencies and within police forces—is that the business is new. It is an area of work that did not exist before, and in many respects, it is trailblazing. We all want it to be more successful, because we are sick of criminals gaining from their criminality, and we must therefore do more. There are many issues involved, not least of which is that many cases get stuck because of difficulties in court, which we are trying to resolve. However, important trailblazing is taking place.

The hon. Member for Hornchurch made a point about transparency, which is important and which we need to ensure. The hon. Member for Totnes (Mr. Steen) spoke about trafficking. If he is saying that he has been trying unsuccessfully to get the information and that it was not included in the annual report, I will take up the matter with SOCA to see whether I can get any additional information that might be helpful to him. I will copy the reply to you, Mrs. Winterton, to the hon. Members for Hornchurch and for Totnes and to the Chairman of the Home Affairs Committee.

I have had no discussions with the Ministry of Justice on the issue raised by the hon. Member for Totnes—frankly, I do not know what aspect of Ministry of Justice business he was referring to—but that would be subject, as always, to the Data Protection Act 1998, human rights legislation and so on. However, I have had no particular contact about that.

The Serious Organised Crime and Police Act 2005 (Disclosure of Information by SOCA) Order 2008 was introduced consequentially to the abolition of the ARA and its director. It ensured that SOCA, which took over some of the ARA’s functions under the Proceeds of Crime Act 2002, could disclose information in its possession to named bodies for the same purposes as the ARA. However, as the hon. Member for Hornchurch has highlighted, it goes further than that.

The order was subject to the affirmative procedure and was debated by the Fifth Delegated Legislation Committee on 24 June. The hon. Member for Hornchurch correctly identified during that debate that the additional provisions for the onward disclosure of information would apply to all SOCA’s functions—in other words, they were not limited to those inherited from the ARA
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under the amendments to the Proceeds of Crime Act 2002. As a believer in parliamentary scrutiny, I am grateful to him for discovering that, for securing that information and for bringing it before Parliament. It is an important demonstration of how the process can work, and he should be commended.

I accept that the matter was not explored fully in earlier parliamentary consideration, for which I apologise. The order was presented as providing the ability to disclose information obtained by SOCA in connection with the functions transferred from the ARA. However, during the debate, I accepted the point that the order also applies to information obtained by SOCA in connection with the exercise of any of its existing functions under sections 2 and 3 of the Serious Organised Crime and Police Act 2005, namely other matters relating to serious organised crime and information relating to crime. Accordingly, information that came into SOCA’s possession in the exercise of any of its functions can be disclosed onwards under the new provisions created by the order.

Hansard records that I agreed with the point made by the hon. Member for Hornchurch. It is on public record that I explained the full effects:

The order adds to the designated functions for which SOCA may make a disclosure under section 33 of the Serious Organised Crime and Police Act 2005, namely for the purposes of protecting public health and for the functions of the Financial Services Authority. The hon. Member for Hornchurch asked me to clarify whether SOCA had asked for the power. To put it on record, the answer is no, but we were advised by our lawyers that we needed to ensure that SOCA had the power, which is why we introduced the order.

In subsequent correspondence with the hon. Member for Hornchurch, I offered to withdraw the order and lay
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another in similar terms. On further consideration, I was advised that that would not have been an appropriate use of the Committee’s valuable time, as the drafting and effect of any new order would be exactly the same as the one already made. However, I welcome the opportunity that he has provided to explain some of the effects of the order.

In my view, it is sensible and appropriate that SOCA’s disclosure of information powers should be consistent for all its functions. My officials have been in contact with SOCA and, although SOCA did not proactively request the additional purposes for which information can be disclosed, it agrees that its powers to disclose should be consistent across all the information that it holds, however that information came into its possession. That is a small further development in the tools available to fight crime.

Although SOCA did not request the additional power, if we are to put it on the same footing as the ARA for disclosing information that came into its possession in the exercise of powers under the Proceeds of Crime Act 2002, it is sensible to apply that to all its information. SOCA has also confirmed on a practical level that it would be difficult, perhaps impossible, to identify and separate which of its information was obtained under its functions under the Proceeds of Crime Act 2002 and which was obtained under its other functions. The free flow of information within SOCA makes it difficult to trace the original source, and to separate and handle information differently would impair the internal workings and operation of SOCA.

The order is sensible, proportionate and necessary. I apologise to you, Mrs. Winterton, and to the hon. Member for Hornchurch that it was not as accurate as it should have been when we first discussed it. I hope that this debate has gone some way towards putting on record what should have been said in the original Committee. I will do what I have said on finding out information for the hon. Member for Totnes. I also hope that the hon. Member for Hornchurch is satisfied.

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Education Maintenance Allowance

Ann Winterton (in the Chair): I call Mr. Gordon Prentice, who has been successful in securing this debate.

1 pm

Mr. Gordon Prentice (Pendle) (Lab): Thank you, Mrs. Winterton. You say that I have been successful in securing this debate, but I have been somewhat overtaken by events. I raised the issue of education maintenance allowances last Wednesday with the Prime Minister, and when I put in for the debate I intended to call for the company responsible for administering EMAs to be sacked because of its incompetence. However, the Learning and Skills Council, with the approval of the Minister for Schools and Learners, has done that job for me. Nevertheless, I want to take the time available to me to talk about the lessons that might be learned from this fiasco.

Central Departments increasingly turn to the private sector and third sector partners to deliver important state services. Last year, I think the amount involved was about £79 billion, so we are talking about big business. Sometimes—too often, I think—things go wrong. Only a few months ago, we learned that the American firm ETS Europe, which lost the standard assessment tests contract, was worth £156 million over five years. The contract for delivering EMAs amounted to £80 million, so we are talking about huge sums of public money.

The EMAs are means-tested allowances of up to £30 a week paid to 16 to 19-year-olds to encourage them to stay on in education. They are really an incentive for young people to stay at college and stay in education who might otherwise go out to work because their families are not particularly well off, so the thinking behind EMAs is laudable. It was a marvellous policy initiative but unfortunately it has not been delivered well. There have been huge delays in getting the money to the students and that has had a huge impact on those young people, who rely on the EMA to pay for transport, lunches and other things that young people buy.

Mr. Andrew Smith (Oxford, East) (Lab): I congratulate my hon. Friend for raising this important issue, which has hit my constituents as it has hit his. He may be interested to know the answer to my parliamentary question about the average time it took to complete EMA applications, which is particularly important for the client group that we are talking about. The chief executive of the Learning and Skills Council wrote that the problems with EMA processing were such that the LSC could not be

Does that not show not only that things were bad but that the LSC did not even know how bad they were? Furthermore, does my hon. Friend agree that the situation points to the need for proper monitoring and management of the successor arrangements?

Mr. Prentice: Indeed, and I shall come on to that very point. That is why last Wednesday, when I put my question to the Prime Minister, I described Liberata,
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the company involved, as dysfunctional. It was completely dysfunctional and I will deal with that point in more detail in a moment.

I was mentioning the difficulties facing young people because of the problems. In Blackburn, just down the road from my Pendle constituency, it was reported by the BBC and others that Blackburn college had to tide over students with £10 Tesco vouchers. The National Union of Students got in touch with me to say that EMAs were so important for some students that if they did not get them this year there was a real danger that they would drop out of college completely.

The delivery failure was of galactic dimensions—it really was. We know from the Minister, who helpfully put the exchange of correspondence between himself and the LSC in the Commons Library, that 111,000 students were waiting for payments on 8 October, but that at one stage the backlog of students waiting for payments was more than 200,000; that was the figure given by Mark Haysom, the chief executive of the LSC, when he wrote to the Minister. The figure is now down to about 12,000, which is good. We can all breathe a huge sigh of relief, and I hope that the remaining 12,000 or so applications can be processed without further delay.

The Minister for Schools and Learners (Jim Knight): I am afraid that when I respond I will have to correct that figure of 12,000, so the picture is not quite as rosy as my hon. Friend thinks. I just wanted to point that out immediately, but I will correct the figure properly when I respond.

Mr. Prentice: That will not affect the line of my argument at all, but we will come back to that point later.

What went wrong with the introduction of the new contract? The contract for EMAs originally went to the outsourcing company Capita in September 2004. I think that it was a five-year contract and, by all accounts, it was delivered without problems by Capita. In July 2007, the contract was re-tendered and the new contract brought together and consolidated a variety of learner programmes. It was obviously anchored by the EMA, but it also included sixth form child care, the adult learning grant, the learner support fund and so on. Those programmes were all brought together and the contract was awarded to Liberata. The LSC had commissioned a feasibility study in June 2006, which showed compatibility between the programmes that I have just mentioned. At that stage, the LSC clearly thought that the new combined programme, if I can put it that way, was deliverable.

Then everything started going pear-shaped. The problems were spotted early on. In July 2007, Liberata was awarded the new contract but later in 2007 people realised that things were not working as they should. On 19 November, the chief executive of the LSC, Mark Haysom, told the Minister:

From the word go, therefore, the commissioner—the LSC—knew that things might not be delivered.

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So there we are. The contract has gone back to Capita. The transfer of functions will take place this Friday, I believe, and Liberata will lose the revenues that it would have received from the rest of the contract. I think that the amount is about £60 million; the original contract was between £75 million and £80 million. Astonishingly, however, that dysfunctional company will not face any penalties.

I may have got this wrong, but it seems to me from reading the correspondence on the issue that the LSC is paying Liberata £4 million to transfer

to the new company that will be delivering EMAs, which is Capita. Instead of getting money back from the company that let down hundreds of thousands of students, the public purse is forking out an additional £4 million to make the transition easier. My friend the Minister explained that to me last week, stating that Liberata had employed

That is the Government’s position, but I completely disagree. Penalty clauses are in contracts for a purpose. When a company, whether private sector, third sector or otherwise, does not deliver what it has promised, there should be penalties.

The acting chief executive of Liberata when all that was happening, Richard Webster, said that he hoped the Learning and Skills Council would not impose a £3 million penalty. He said:

Since it is no longer delivering the service, I see no reason why it cannot pay a penalty.

Even when the meltdown was occurring, Richard Webster was still talking things up as though everything was still manageable and hunky dory. On 31 October, he mused on the delays and difficulties and said:

That was complete moonshine. Staff familiarity was not where it was supposed to be, and I shall spend a couple of moments describing the situation in my constituency. In Nelson, the biggest town, Liberata created 100 jobs to administer the EMA. On 17 September, the Lancashire Telegraph, the big regional daily, proclaimed on its front page, “Jobs Lift-Off”—I have it with me as a visual aid. Everyone was happy that all those jobs were coming to Pendle—100 call centre jobs in Nelson. On 18 September, the chief executive of the local authority, Stephen Barnes, was quoted as saying:

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