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20 Oct 2009 : Column 781

Mr. Straw: These are local prisons, and there is always a substantial movement in and out of any local prison. Local prisons, especially those in London, are very difficult to manage and I pay tribute to the staff. That has always been the case, but we have engaged in a massive building programme and so far-touch wood-we have kept prisoners out of police cells for at least the last year. Should the main Opposition party wish to trade stories about the state of our prisons, I can say that on any measure they are now in infinitely better state than they were under the previous Administration.

On the hon. Gentleman's key point about mental illness, I accept that there are far too many prisoners in prison who ought to be in hospital because of their mental health problems. That is why we set up the Bradley review, the findings of which we are now seeking to implement.

Sir Alan Beith (Berwick-upon-Tweed) (LD): Pursuing the point made by my hon. Friend the Member for Cambridge (David Howarth), ought it not to be a much clearer objective of the prison system that prisoners are assigned to, and kept in, institutions with regimes that have the capacity to reduce their likelihood of reoffending? Does the Secretary of State recognise that a lot of the time that is not happening, which is why such disgraceful transfers might not have been so obvious?

Mr. Straw: We do, indeed, seek to transfer prisoners whose sentences are of reasonable length to fulfil the major part of their sentence in institutions that might help to reduce their reoffending. I also say to the right hon. Gentleman that reoffending rates have significantly improved, not least as a result of some of the targets we have set. The problem in some of these cases is that these were prisoners who had to go to court. That is the purpose of a local prison. Such prisoners cannot be held miles away from the court they are attending.

Emily Thornberry (Islington, South and Finsbury) (Lab): Does my right hon. Friend agree that by indulging in these transfers the senior management have not only betrayed the prisoners and the trust we have put in them to treat prisoners properly and fairly, but have also completely eclipsed the hard work of prison officers who, in fact, have been improving conditions in the two prisons concerned?

Mr. Straw: May I first pay tribute to my hon. Friend the Member for Islington, South and Finsbury (Emily Thornberry), in whose constituency Pentonville prison lies? I know of her great concern about the prison and her great commitment to the work of the staff. On her overall point, I entirely agree with her; one of the tragedies of what has happened is that, as Dame Anne Owers has said, all the good work and the improvement in progress, which was specified in the reports and which the Opposition failed to acknowledge, has been eclipsed by this terrible series of incidents.

Mr. Douglas Hogg (Sleaford and North Hykeham) (Con): May I say to the Secretary of State that the real concern is that the practice is very widespread? Will the inquiry look into that? Will it also examine the role of the medical staff who have been involved? Will he alert the independent monitoring boards of each prison to address this particular question?

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Mr. Straw: On the issue of whether the practice is widespread, that is obviously a question for all of us-it was the first question that I asked. That is why I have set up this detailed investigation, which will look, first, at the transfer records for each prison that has had an announced inspection to check whether any prisoners were shipped out and shipped back again-that will be the key indicator. If any such prisoners are found, further investigations will be carried out. I also accept what the right hon. and learned Gentleman says about medical staff.

Fiona Mactaggart (Slough) (Lab): We do not yet know whether these transfers contributed to a prisoner killing himself, but would the Lord Chancellor agree to report to this House, following the report of the prisons ombudsman and the coroner's report, on whether that was the case in this instance and on the number of prisoners up and down the country who are killing themselves while they are in our prisons?

Mr. Straw: On the specific issue, the reports of the prisons and probation ombudsman are normally published. The publication of this report is a matter for the ombudsman, not for me, however, I fully understand the concern of the House to see the report. An inquest will also take place, probably after that. It is entirely appropriate that that should take place before any announcement is made to the House, but I will, of course, keep the House properly informed. Any suicide in prison is deeply to be regretted, but I just say to the House that the number for last year, 60, is lower-the figure fluctuates considerably-than it has been since 1997.

Angela Watkinson (Upminster) (Con): If there is to be further investigation into any other possible occurrences of transfers related to the inspections, how will such transfers be identified and separated from the more routine transfers that take place when prisoners are making court appearances, which so often lead to their curtailing any education or training courses in which they are involved?

Mr. Straw: I am quite clear that those who are doing the investigation will, from their knowledge, be able to spot why a transfer took place. If a transfer took place from Wandsworth, Pentonville, Brixton or any other prison to a court-this happens every day-it is perfectly obvious why the person was transferred. On the other hand, if there was a transfer to a court and then a transfer to a different prison, and the original prison was being subject to inspection, that would trigger a warning light. This process of investigation will give a very good indication of whether, prima facie, this practice has been going on. I must say that the director general of the Prison Service, Phil Wheatley, and his senior staff, as well as the chief inspector and I, are totally and utterly committed to checking and checking again as to whether this practice has been going on at any other prison. As Mr. Wheatley said this morning, he has been a prison governor and in his experience, he has never come across such practice, but we may have to live and learn.

Mr. Peter Bone (Wellingborough) (Con): I spoke to the governor of HMP Wellingborough this morning. He was aghast at the practice and confirmed that it had
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never happened in Wellingborough. Will the Lord Chancellor explain to me why the inspections are announced in advance and why the inspectors do not just turn up?

Mr. Straw: Some inspections are announced in advance and a great many are done unannounced. This is a matter for the chief inspector of prisons. I understand that her view is that having announced inspections provides an opportunity for the prison to ensure that it is in good order and to meet objectives previously set. She does not inspect to targets-she has made that clear-but she inspects to key indicators of what she describes as a "healthy" prison. At the same time, the inspectorate does use-I believe that it uses these more than formal, announced inspections-unannounced inspections. How the chief inspector does it is entirely a matter for her, but I think that the whole House will wish to place on record its thanks to her; it was in an announced inspection that this situation emerged.

The other point that I would simply make to all those Members who have asked whether such activity is more widespread than the current examples is that the information about these transfers emerged through complaints that prisoners made to their lawyers. Prisoners are fully entitled to write to their lawyers, to the ombudsman, to HM inspectorate of prisons and to Members of this House confidentially and without that information or those letters being seen by the prison staff. We can rest assured, given the publicity that has been given to this matter, that if further prisoners feel that they have been subject to such unacceptable transfers we will know one way or another.

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Royal Mail

3.55 pm

The Minister for Business, Innovation and Skills (Mr. Pat McFadden): With permission, Mr. Speaker, I wish to repeat a statement made by my noble Friend the Secretary of State for Business, Innovation and Skills about the decision of the Communication Workers Union to take national industrial action later this week.

No one is in doubt about the damage that such industrial action will cause, but those who advocate strike action have not been clear about why it is threatened. The dispute at the Royal Mail is about modernisation, which has been the subject of localised strikes, particularly in London, for many months. We know from the Hooper review on postal services about the company's need to change and reform in the face of a postal market that is being transformed as people switch to text, e-mail and direct debit, and as the growing area of mail, which is parcels, offers a variety of alternative operators from which to choose.

Royal Mail has to respond to the fact that 10 million fewer letters are posted each day than were posted three years ago, and that total mail volumes have fallen by a further 8 per cent. in the first half of this year. In other words, if it stands still, the company faces terminal decline. Following a national strike two years ago, the union-the CWU-and management reached a national agreement on pay and modernisation. The agreement set a framework of four phases for bringing essential change to Royal Mail. The first three have been introduced throughout the country but are being resisted in some places, which I will come to shortly. The changes have involved the introduction of more walk-sorting machines and new working practices including expecting employees to do the full number of hours that they are paid to work.

Phase four, the next phase of modernisation, is yet to be agreed in substance rather than outline and will be about a new framework for improving industrial relations. That will include introducing walk-sequencing machines to sort the postal delivery round and developing new business opportunities along with a new system for rewarding employees.

In the majority of Royal Mail's workplaces, phases one to three of the national agreement have been implemented without any local industrial action being mounted. Outdated working practices have been replaced and efficiency is being improved, but in other parts of the country-most notably in London-there has been repeated non-co-operation and industrial action to frustrate the agreement's implementation. It is claimed by union representatives that in London the management are unilaterally imposing change that goes beyond the 2007 agreement's first three phases. Management contest that, pointing out that all that London is being asked to accept is what everyone else in the country is delivering under the first three phases. It is those local disputes that have now escalated into the threatened national strike.

I very much regret what is happening and, to put it candidly, we think that it is totally self-defeating for our postal services and for those who work in them. Taking industrial action will not resolve the dispute; it will serve only to drive more customers away from Royal
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Mail. In the delivery of parcels-where there would otherwise be a prospect of growth-Royal Mail's reputation for reliability could be irrevocably damaged and in the delivery of letters such action will lead to a further twist in the downward spiral of mail volumes. Business will be quick to recognise that, while one can picket a delivery office to stop the service or refuse to deliver letters, one cannot picket the ever present internet.

Royal Mail's small business customers will look on with anger and exasperation. Just as there are signs of the economy recovering and the prospects for their businesses improving, strikes now will set them back and put their businesses in jeopardy. Royal Mail's finances will be plunged into the red. Last year, out of a £6.7 billion mail business turnover, the company made less than 1 per cent profit. One thing that the company cannot afford is strikes and industrial action.

Change in a big organisation is never easy, but for the Royal Mail it is unavoidable. Let me make it clear that, contrary to what some may say, the dispute is not about pensions. The trustees are engaged in their periodic assessment of the pensions deficit and, lest there be any doubt, let me make it clear that the Government's policy on the pensions deficit will not be dictated by strike action. The Government were prepared to take on the pensions deficit as part of a package of modernising measures set out in the Postal Services Bill. Sadly, however, the CWU did not support those proposals.

When it comes to financing, the Government and the taxpayer have not held back. We have made available £1.2 billion to finance a modernisation and investment programme, and that remains on the table.

We are, of course, in frequent contact with both management and the union. They have continued talking today, and we strongly welcome that. Our message to them has been clear: put your customers first; strikes are not the way to resolve differences or safeguard the future of our postal services.

The Royal Mail needs management and unions to have a relentless focus on turning it into an efficient, modern postal company, protecting as many jobs as possible and providing customers with the services that they need. Both sides should put behind them, once and for all, the endless cycle of disputes. We will, of course, continue to encourage a settlement, but we cannot impose good industrial relations on the company, or disinvent the internet. An independent third party may well be needed to help the two sides resolve their differences. ACAS is engaged, but we have to be realistic: it will be far easier for ACAS to play an effective role if the threat of a national strike is lifted.

The Government are ensuring that vital services to the public, especially those who are most vulnerable, are maintained. If necessary, the Department for Work and Pensions will implement plans to ensure that the small minority of pensioners and others on benefits who still receive their cheques in the post will be able to pick them up from their nearest post office. If the disruption is prolonged, the Department of Health and NHS trusts will make alternative arrangements to transport appointment notifications, blood samples and test results.

We urge both sides to make every effort to avoid damaging industrial action and to resolve this dispute.
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That is what is in the interests of the Royal Mail, its employees and its customers. I commend this statement to the House.

Mr. Kenneth Clarke (Rushcliffe) (Con): First, I join the Minister in hoping that management and trade unions find some way of resolving the dispute and avoiding a totally suicidal strike. They should return to the previously agreed programme of modernisation as quickly as possible, in the interests of both the customers and staff of Royal Mail.

Does the Minister agree that we should welcome the management's announcement that, if necessary, they will recruit temporary staff to maintain the service to customers? Many small businesses would be threatened by a continued dispute, and of course the possibility of disruption to the Christmas mail looms before us. I hope that he will welcome the management's decision in that regard.

The Minister's statement was factually accurate, but surely he does not think that he can wave away the Government's involvement in this matter. Is it not plain that it was the Government's weakness in conceding on their policy of part-privatising Royal Mail that almost immediately encouraged the Communication Workers Union to believe that it could move to reopen the two-year-old deal on modernisation and contemplate strike action? There seems to be a clear relationship between the two.

I welcome the continued commitment to the recommendations of the Hooper report, which we share, and the three key proposals which have to go together if they are to proceed at all. I hope the Minister can reassure me that that resolution to the existing policy will be maintained in the face of the undoubted pressures that he will come under if a strike goes on. After the cave-in on the Bill, can he reassure me that his weak Prime Minister will not next induce him to start taking apart the Hooper recommendations and making concessions to those who are challenging the modernisation programme?

As the Minister said in his statement-this is a stark remark-if the company stands still, it faces terminal decline. Is it acceptable in the face of such a dramatic remark for the Minister to admit that the Government have no policy, are proceeding with no Bill, and are capable of doing nothing as the service looks likely to face a risk of terminal decline? Does he agree that if things continue in this way-I do not blame him personally; I am sure it is the Prime Minister and the majority of the Cabinet who are responsible for this frozen impasse-he will leave to the next Government after the election in May whatever wreckage remains of an extremely important public service and the mail system of this country? He seemed powerless to do anything about it.

Finally, would it be fair to regard the issue, as I regard it, as a symbol of the Government's continuing inability to modernise and reform our great public services? Do not the facts as set out in the Minister's statement show that on that front this dying Government are weak, impotent, powerless and, like most members of the public, a horrified spectator of events as they unfold in the Royal Mail, over which they no longer have any control and for which they can no longer take any responsibility?

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Mr. McFadden: There is, of course, nothing new about the Royal Mail hiring temporary staff at this time of year. It does that every year. This year it is hiring more because of the situation that it faces.

The right hon. and learned Gentleman asked me about Government involvement. The Government have put up £1.2 billion to finance the modernisation that is at the heart of the dispute. Far from that being delayed or held back by the dispute, we want to see it proceed because that is in the interests of the Royal Mail and its workers. What we cannot do is impose on the company the productive industrial relations that are needed for that to happen. In the end, ACAS involvement or not, that must be down to management and unions working through the issues that are needed to take modernisation forward.

The right hon. and learned Gentleman spoke about the Postal Services Bill. I note his party's position, as set out in the Financial Times this morning. We said that we would not proceed with the Bill at this time owing to market conditions, and that is precisely what his party set out as its position in the Financial Times this morning. It too would want to test the market before proceeding with the Bill. I note his position on that, as set out this morning.

John Thurso (Caithness, Sutherland and Easter Ross) (LD): I am grateful to the Minister for the courtesy of an advance copy of his statement.

As the Minister made clear, Royal Mail is no longer the essential business tool that it once was. The combination of electronic communications, growth in parcel delivery services and competition for business mail means that Royal Mail has a future only if it becomes competitive in that new environment. The present dispute will not assist that goal. It may, indeed, hasten the demise of Royal Mail by precipitating a flight to other suppliers.

Does the Minister agree that many larger businesses have already announced plans to place contracts with alternative suppliers, but that others which are less able to do so are particularly vulnerable, and that this dispute will have a disproportionate effect on them? I refer, in particular, to small businesses, some of our most vulnerable citizens and people in rural areas, all of whom have the least alternative choice. Does the Minister agree that a prolonged dispute poses a clear and present danger to the universal service obligation? What steps will the Government take to ensure its survival?

The Minister has assured us that benefits payments by the Department for Work and Pensions will, for those in receipt, be available at post offices. Will he give similar assurances regarding winter fuel payments, which are coming up shortly? What about the volume of mail that Her Majesty's Revenue and Customs sends out on tax credits, and its other correspondence? Will the Minister confirm that the Government plan to seek alternative suppliers in the private sector for their own postal business? What assessment has been made of the impact of that decision on Royal Mail's future?

Part of the reason why we are in this situation is the stalled legislation. The Minister well knows that I would not have begun it, but he must now accept that having started and then stopped is worse than not having started in the first place.

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