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"Inner city seats are so hard to win because Labour has filled them with poor people who are desperate and dependant on the state, so they vote for a party that they think is of the state."
That is why those people are being punished. They vote Labour, and they want to live and work in the inner city, but that is not good enough for the Conservatives. That is what my constituents are facing, for ideological reasons of gerrymandering and social engineering.
Stephen Lloyd (Eastbourne) (LD):
I have had the pleasure of listening to speeches all afternoon. In a way, they could be summed up by saying that Labour Members
believe we are all going to hell in a hand cart, whereas Government Members believe we are heading towards the sunny uplands. My own view is that we are somewhere in between, but I am a little closer to the Government side.
Tony Blair apparently said to the right hon. Member for Birkenhead (Mr Field) in 1997, "Go away and think the unthinkable on welfare reform." He promptly went away and thought the unthinkable, and a key part of it was recognition that benefits had to follow low incomes for people to get back into work and that benefits cost far too much-and the then Chancellor of the Exchequer and subsequent Prime Minister crushed it on the spot. So what is happening under the comprehensive spending review? It looks as if welfare reform is heading towards thinking the unthinkable. My understanding is that an extra £2 billion is to be included within the universal benefit, which will mean that people on low salaries can take a lot of their benefit with them. I will obviously need to check the fine detail as it gets presented over the next few months, but if that is right, it will make a profound difference to many hundreds of thousands of people.
Let me provide an example. A few years ago, I had to do something in Eastbourne. Although it is clearly the best constituency in the whole country, this was a little bit of a nightmare, which I suspect other Members might have experienced at some time in their lives. I refer to judging a beautiful baby contest. Trust me, it is a nightmare. How do we ensure that we do not win only the winning parents' votes and lose all the others of the babies that we do not choose? I recall coming across a particular lady whom I knew. She looked about 50, but was probably in her late 30s. She was holding a baby of about six months or less. Standing next to her was her daughter-probably 17 or 18, but she looked a lot older-and the grandmother, who was completely inebriated. This was at 2 o'clock in the afternoon. As I looked at that child, I have to admit that behind the veneer of the politician's smile, I felt utter fury because I knew that I could write that baby's curriculum vitae right away-it was a goner. I find that absolutely unacceptable. If the changes to welfare reform, when followed through by people coming off benefit and going into initially low-paid jobs, mean that they can take their benefits with them, it will be a rational decision to get a job.
Chris Williamson: If the hon. Gentleman is so concerned about low-paid workers, will he not concede that cuts to housing benefit will make it much more difficult for many of them to hold down their jobs? Contrary to his assertion that the policies he supports will help people to get into work, they will throw more low-paid workers out of the jobs that they are undertaking at the moment.
Stephen Lloyd: The reality is that when a nation has reached a place where it is acceptable and normal for rents upwards of £30,000, £35,000 or £40,000 a year to be paid by the state, something has to give. I see the challenges, but I am hopeful that the Government will come up with a greater amount of discretionary money, particularly for places like London. In principle, however, I support the narrative. We need to realise how crazy the vast majority of working people view the fact that they could never rent a £20,000-a-year flat in a million years, yet the state allows rentals for much more than that. Forgive me, but I genuinely believe that anyone supporting that lives on a different planet.
Let me make another couple of important points about this comprehensive spending review and welfare reform. Just last week, I stayed at the Premier Inn-as we all know, that very salubrious place across the river. I have stayed there about 20 times since the election. I have met about 20 to 30 members of staff, and very nice they are too, but not one of them is an indigenous black or white British person. Not one! What is going on? I spoke last week to a friend who runs a café in Eastbourne. He said, "Stephen, I keep trying to get people to work and I offer them jobs, but they keep telling me that they cannot accept them because they will lose their benefit if they work for more than 16 hours a week." What is going on? We have to forget all the backwards and forwards; I profoundly believe that we have got to change the system. It is not only inefficient, it is profoundly cruel.
As I have the Minister here, I want to flag up a number of areas of the CSR about which I have concerns. The first relates to Equitable Life. I commend the Government for their payments to Equitable Life policyholders; they came forward when the previous Government did not. However, the payment of £1.5 billion could have been higher. Considering that the second instalment of £500 million is going to be paid in the second term, I certainly believe that we should increase and expand it. We have a moral duty to do so.
My second area of concern is small businesses. I spent a few years working as a consultant with the Federation of Small Businesses in south London before I got elected to this place. Small businesses broadly support the comprehensive spending review, but they need the Government to be really active on cutting bureaucracy and setting small businesses free. I urge the Government to do that. I believe that this is a fair comprehensive spending review. It is a challenging one, and I appreciate that we shall have to see what happens over the next few years, but I commend it to the House.
Alex Cunningham (Stockton North) (Lab): Last week's comprehensive spending review delivered cuts beyond the dreams of even Margaret Thatcher that were welcomed with glee from the Tory Benches. Those cuts will really impact on our children and schools. I have been inundated with e-mails from teachers in Stockton North, and from teachers in neighbouring Stockton South who teach children from my constituency. They are incensed by the axing of the schools sports partnership. The head teacher of a special school in my constituency, Abbey Hill school and technology college, Clare Devine, wrote to me to say:
"I fully endorse the partnership's work in transforming PE and school sport, and believe that the withdrawal of funding is a betrayal of the Olympic legacy to inspire young people to take part in PE and sport."
What is that head teacher going to say to a child with the most challenging physical and other special needs who enjoys participating in sport through the partnership but can no longer do so? Perhaps the Minister will offer us some ideas.
Today, I have chosen to focus specifically on what the cuts will mean to the Cleveland fire service, which serves Teesside and Hartlepool. Last Friday, I met the chief fire officer, who outlined exactly how dangerous the cuts announced in the comprehensive spending review
will be. I also met real firefighters in Billingham in my constituency, in their fire station on the edge of Europe's biggest fire risk-a huge chemical and related industrial complex. The Cleveland fire authority has already made cumulative efficiencies of £1.8 million over the past three years. The savings have been officially recognised by the Department for Communities and Local Government. This is taking place against a background of improved outcomes, including the greatest reduction in primary fires nationally.
The comprehensive spending review reduced the revenue support grant from central Government for fire and rescue authorities by 25% over the next four years. The effect on Cleveland will be significant, given that 67% of its budget comes from the revenue support grant, with the rest coming from council tax. A 25% cut in Cleveland equates to a reduction in the overall budget of almost £6 million. Our firemen and women put their lives on the line every time the bell goes. They accept their responsibilities quietly and get on with the job, yet they will now face a greater risk to their personal safety if numbers are cut and resources stretched way beyond any reasonable limit. We have already seen deaths in other parts of the country that have been blamed on cuts. Is the Minister prepared to pay with even more deaths?
The Cleveland fire service area hosts 12% of all the COMAH-control of major accident hazards-regulated sites in England and Wales, yet it is a net loser under the current funding formula, which has seen an increase of just 2% across three years. The fire service in Nottinghamshire has received an increase of 19%. On top of this, the service is now being asked to cope with the new 25% cut. The chief fire officer is not confident that cuts on this scale can be made through efficiency savings alone, and believes that the service will be compromised if personnel and equipment are reduced. Lives should not be put at risk. I am told that a fully staffed fire engine costs in the region of £800,000 a year to staff. My fear is that, with £6 million of cuts, front-line services will be badly hit. The local firefighters whom I met last week had a clear message for the Government: we have now cut right through the fat and we are down to the bone. We cannot cut any more. We simply cannot afford to remove fire engines against this risk.
I want to remind Ministers of the Flixborough disaster of 1 June 1974. It happened in an area that is not dissimilar to my own constituency and other parts of Teesside. We saw what disaster meant that day, and we saw the tremendous work done by fire crews. We need to know that our fire services have the people and equipment that they need in order to respond to potential disaster, but the Government are turning their back on that need.
I hope that the Minister responsible for the fire service will accept my written invitation to see these challenges for himself, and will think again about the cuts to which he has agreed. I am particularly anxious for authorities such as Cleveland which have already delivered efficiency savings to be given a level of protection. There is only so much money to be saved through efficiencies, and sooner rather than later the cuts will hit front-line fire services.
It is absurd that our fire authority is being forced to consider making full-time stations part-time, and to rely on part-time firemen in an area with the highest
risk in the whole of Europe. Firefighters, workers and ordinary families whose homes surround our industrial sites are being put at risk by these arbitrary cuts. I hope that the Government will think again about that risk and the way in which they are adding to it, because lives are at stake.
Bob Blackman (Harrow East) (Con): I congratulate the Chancellor and his team on beginning the process of righting what has been wrong for the past 13 years. After those 13 years, we find ourselves in circumstances in which, for many people, it is better to be on benefit than to be in work. I listened earlier for a word of apology for the record deficit that the Labour party had created, and for any plan it might suggest to get us out of it or even suggestions of cuts that it would make in public expenditure. We are still waiting for the answers.
I shall confine my remarks to two aspects of the CSR. The first is reform of the benefits system. We have heard much from Opposition Members, and from people outside the House, about housing benefit, which is one of the benefits that need fundamental reform. It is horrendously complicated. It is paid on a daily basis, with tapers which mean that if people obtain work they immediately lose the benefit. It has therefore become a positive disincentive to work. The principle that we are adopting as a Government is that it should always be better to work than to receive benefits. I strongly support the cap and, indeed, the gradual withdrawal of housing benefit from people who refuse to work.
We must also ensure that there are job opportunities in the private sector, and opportunities for people to be trained to take those jobs. I support the Work programme that the Government are implementing, because it will bring about a fundamental change in British society that we all want to see.
It is currently proposed that the housing benefit cap should apply to people paying £20,000 a year in rent. That is £35,000 in pre-tax income. Given the other benefits that claimants are likely to have accrued, they would have to earn a salary of about £50,000 before they would replace their lost benefit income. If that is not an incentive not to work, I do not know what is. We must change the whole philosophy of housing benefit, and the basis of its operation.
A system that taxes people with one hand and gives them benefits with the other cannot be right. It is far better to lift people out of taxation-as this Government have done-and give them more of their own money to spend as they wish than to tax them and give them benefits at the same time. We have an opportunity to simplify the whole process. I strongly support such action, and I hope that we will move rapidly to a form of universal benefits rather than the horrendously complicated arrangements that existed under the last Labour Government. I trust that they were the last ever Labour Government.
I applaud this Government for their prompt and firm action to settle the Equitable Life dispute once and for all. For 10 years the Labour Government prevented Equitable Life policyholders from receiving the compensation that was due to them, which was a disgraceful way to behave. I especially applaud what has been done to reward trapped annuitants who desperately need the
money now. I urge Ministers to get on with that job as quickly as possible so that we can pay retired people who are living in relative poverty as a result of the Labour Government's actions.
The Government have accepted that the proper compensation due to all the policyholders is some £4.26 billion. The £1.5 billion goes some way towards that. Many of those policyholders are still working; they will be working for 10, 20 or possibly 25 years more. They need support and help, too. I ask that, as the economic times get better, improvements come, we create more jobs and the economy recovers, our Treasury colleagues consider putting more money into those policyholders, so that they are properly rewarded for the pain that they have gone through under the last Labour Government. That is only right and just. I trust that we will see that happen in the not-too-distant future.
Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab): I echo the views of my colleagues who have already spoken. I concur with them about the impact that the CSR will have on the poorest people, as evidenced by the recent BBC-Experian poll placing my area and the surrounding area in Teesside and East Cleveland at the bottom of that list-evidence that my proud people who struggle so hard are in the least resilient position to deal with the Government's harsh cuts.
Let us take the Government's threatened public sector sackings, such as those of 180 firefighters in Cleveland fire authority, which not only affects the local economy in terms of spending and welfare, undermining the average man in the street's confidence in the economy, but exposes the local population, massive processing sites, and the manufacturing, steel and petrochemical industries of Teesside to hugely increased fire risk and in turn only deters further future inward investment in that area. The result of such a policy will be increased unmanaged industrial risk, which will only increase the insurance costs of manufacturing industry in my area.
Inward investment for manufacturing is of real concern, from wherever it may come. Teesside is not fussy; it just wants the investment. However, on Wednesday 20 October, during Prime Minister's questions, following a question asked by my hon. Friend the Member for Darlington (Mrs Chapman), the Prime Minister could not come up with one inward investment or new company in the north-east that had come to the region without public funds leading to and attracting private inward investment.
When the Prime Minister, at the recent CBI conference, made assurances of £60 million to the north-east as "new" money, he was being wholly disingenuous. These moneys were set aside by Labour as a result of the Prime Minister's fiscal friend Kirby Adams's attempt to be a second MacGregor. The Prime Minister's mate, Kirby Adams, tried to destroy steelmaking on Teesside. That £60 million was originally set aside by Labour to aid a green regeneration on Teesside; it is not new ConDem cash, as any union official on site whom I worked alongside at Teesside Cast Products will tell you.
The Secretary of State for Business, Innovation and Skills confirmed in a Select Committee hearing on Tuesday that LEPs would receive no Government funding and would have to rely on local authorities or businesses for their funds. If that is the case, LEPs are merely
powerless, toothless, fundless talking shops. In Teesside, that is even more the case, as the back-up service to any potential Tees valley LEP will be reliant on the Tees Valley Unlimited staff and logistical support. However, that too has had £7 million of its £9 million budget slashed.
The regional growth fund will be expected to cover crucial areas such as roads and housing renewal, leaving little in terms of a funding pot for business to apply for. In any case, any would-be small business would have to make a submission for a bid of at least £l million, a sum most small businesses do not require, cutting out crucial small business growth.
I am also concerned at the delay in the green investment bank. The CSR referred, in small print, to the fact that the green bank will not be set up until 2013-14, missing the crucial 12 to 18-month window that we are currently in to take advantage of wind farm production and maintenance off our coastal ports, such as the port of the Tyne, the Wear and Teesport. I am also concerned that changes to the carbon reduction commitment scheme, which amounts to a £l billion tax, will delay green investment and hurt small downstream industry which aids steel production in the UK.
Only yesterday, steel producer Lakshmi Mittal called for more stimulus measures from all Governments to speed growth in the steel industry. I would impress upon the Government the need not to disturb the Thai Sahaviriya Steel Industries ongoing bid. The probable new owners of Tees Cast Products may well begin to doubt the coalition's commitment to the ambitious investment plans, on which I have been seeking a definitive answer since May. I and other Members were promised that immediately following the CSR by the Secretary of State for Business, Innovation and Skills when he visited the north-east and made his magical mystery tour of the Beam mill at Redcar-a site totally separate from the TCP site.
In conclusion, I draw the House's attention to another economic critic of the Chancellor. According with Chris Giles in the Financial Times, in all Departments other than Health and International Development, a 19% real-terms cut is being implemented, compared with the 12% cuts planned by the previous Labour Government. That was down to the fact that the Chancellor played fast and loose with an inconsistent definition of "unprotected". What is clear is that the people of the north-east, and in particular Teesside and East Cleveland, have been left totally unprotected by this Government. I again agree with Chris Giles, as well as other esteemed and documented economic critics, that the Chancellor's comparison in his oration was simply "bogus".
Kwasi Kwarteng (Spelthorne) (Con):
Like my hon. Friend the Member for Central Devon (Mel Stride), I have sat through this debate all afternoon and have listened with increasing incredulity to what Opposition Members have been saying. There is an air of unreality in some parts of the Chamber. The question is not whether we should cut or carry on spending, as the second option is not on the table. Labour Members have accepted in their more lucid moments that they, too, would have had to cut, but as they now enjoy the luxury of opposition they do not have to say what they
would have cut. It is the job of the Government to be responsible and take the decisions on which our future prosperity will depend.
There has been a lot of special pleading during the debate, and that is a part of our job as constituency MPs, but we also have a wider responsibility to the country as a whole, and it is one of the wider responsibilities of the Government to try to make sure that we are on track and that at the end of this Parliament Britain is much more prosperous than it was at the beginning of it.
The contents of the comprehensive spending review delivered by my right hon. Friend the Chancellor last week can be boiled down to just a few questions. First, how did we get here? We all know how we got here. A previous Chancellor-in accordance with the custom of the House, I will not mention him by name-believed he had abolished boom and bust, and his calculations on increasing spending were therefore based on the false premise that the economy would continue to expand. It did not, however. There was a recession, and because he had so many spending commitments, we ended up with a huge deficit.
No one is denying the scale of the deficit. It is the worst deficit of all the G20 countries; every international organisation has pointed out that the British deficit is far worse than those of our peers. The coalition Government had to deal with that, and I believe they have done so very well and effectively. The process has been a painful one, as many Members on both sides of the House have said, but it was the responsible course of action, to which the Conservative party was committed in the run-up to the general election and to which both coalition parties are signed up. We have been facing difficult choices, and as the Chancellor outlined last week, government is about choice. The cuts are necessary. After all, £1 in every £4 we spent was borrowed, which was unsustainable. No one in their right mind would lead their private life on that basis. We cannot keep on borrowing and spending. These are obvious truths which we have recognised and addressed.
The next question is an entirely legitimate one: are these cuts and restraints in spending fair? There is a big dispute about that between Members on the Opposition and Government Benches, but I want to remind the House of certain facts. The current benefits system simply is not working. It cannot be right that people are getting more than £20,000 a year on benefits and are therefore completely disincentivised from working. Many hard-working people in my constituency find it absurd and very frustrating that, as they feel, they are subsidising those who, as a lifestyle choice, have decided not to work. That cannot be right. Hon. Friends have alluded to a change in philosophy in this respect, and it is long overdue. In the long run, people will acknowledge that we did the right thing. It was a tough thing to do, but it was also a courageous thing to do, and it was the right thing for Britain as we look forward to the next few years.
The coalition Government have been utterly responsible and fearless in their determination to tackle our problems. That is what responsible government is about, and I am pleased to be supporting a Government who are responsible and determined enough to deal with our problems and to set our country on the right track.
Mr Chuka Umunna (Streatham) (Lab): Although she is not in her place, I wish to associate myself with the comments, particularly those on welfare reform, made by my right hon. Friend the Member for Lewisham, Deptford (Joan Ruddock), who is also a south London MP. Her comments apply equally to my constituency as they do to hers.
I wish to say a little about the banking sector in the context of this comprehensive spending review, because it has not been addressed in great detail during this debate. During his speech to the CBI on Monday, the Business Secretary said that
"the British economy, two years ago, suffered the economic equivalent of a heart attack with the near collapse of the banking system. Death was averted by speedy intervention to shore up the banking system to prevent an economic slump."
Although he has tended to peddle some of the myths we have heard in the Chamber today, at least there he acknowledged that the previous Government stepped in to prevent the recession caused by the financial sector from turning into a depression. For me, the real question is what contribution the Government are expecting the banking sector to make to clear up the mess it created.
"The failures of the banks imposed a huge cost on the rest of society, so I believe that it is fair and right that in future banks should make a more appropriate contribution, reflecting the many risks that they generate."-[ Official Report, 22 June 2010; Vol. 512, c. 175.]
What was promised in that emergency Budget? First, the Government said that they would set up the Independent Commission on Banking. Secondly, they said that they would take action to tackle unacceptable bank bonuses, referring to the consultation that they would start on the remuneration disclosure scheme and talking about imposing more restrictions on remuneration arrangements for those working in the City. Of course, the centrepiece of the action that the Government said they were going to take on the banks was the banking levy.
So what did we see in the comprehensive spending review? Credit is due in respect of the Independent Commission on Banking. I, for one, am pleased to have seen that set up and its terms of reference are good. Beyond that, there are many questions to be asked about what the Government are doing to ensure that the financial services sector makes its fair contribution. We are constantly told that we will be consulted on the remuneration disclosure scheme in due course. I believe that the Financial Secretary to the Treasury, who is no longer in his place, said that that would take place shortly. However, at the moment it is nowhere to be seen. There is a real risk that if we do not see this in the remuneration disclosure scheme, which would require the banks to exercise more transparency in their remuneration arrangements, things will not be implemented in time for the forthcoming bonus round, which is about to start in December.
We have not seen much movement on the measures to tackle irresponsible bank bonuses either. We have seen movement on this in Europe, but not on the domestic front. As has been said in the Chamber today, the banking levy is to bring in about £2.5 billion of revenue, and the Government are fond of saying that that is higher in net terms than the previous Government's
payroll tax. That is completely disingenuous, because I tabled a parliamentary question during the summer on the likely income from the banking levy and was told by the Treasury that it would raise £1.15 billion in 2011-12, rather than £2.5 billion. I was told that £2.32 billion was to be raised in 2013-14, not £2.5 billion. The income would finally reach £2.5 billion in 2013-14 before falling back again to £2.4 billion in 2014-15. So in 2014-15 the banks would be paying less than the amount that families will lose in child benefit.
What we were also not told in the CSR was that, under the paper issued by the Government, the day after, the banks will have a tax-free allowance-a levy-free allowance-of £20 billion, so they will not pay the banking levy on the first £20 billion of taxable liabilities. This is not a levy; it is a walk in the park for the financial services sector. The five biggest UK banks have already announced well over £15 billion of profits this year, so I ask the Government to spell out how those whom they said they would make pay for the crisis they caused are to be required to make a fair contribution, because we do not see it in the Green Book this week.
Mary Macleod (Brentford and Isleworth) (Con): It is good to have this debate on the comprehensive spending review following the gross domestic product growth figures and the news of the enhancement of Britain's triple A rating, which was described by the Financial Times as
"offering a vote of confidence in the government's austerity programme".
Earlier, I was appalled when the hon. Member for Wallasey (Ms Eagle) not only did not recognise that there were some women on this side of the House, and directed her comments to the gentlemen-as fond as I am of my hon. Friends, I thought she ought to have recognised the talent that we have on the Front Bench in the shape of my hon. Friend the Economic Secretary to the Treasury and elsewhere, too-but, more importantly, did not give us any one plan or any cut that we have come up with that she could agree with. She also did not come up with plan of action that showed exactly what the Opposition would do to get rid of the awful mess that we are in, which they created.
The comprehensive spending review is all about fairness and getting things back on track, ensuring that we get value for money and investing in the future. The general public appreciate that cuts need to be made, and that those cuts need to be right and fair, but that we need to ensure that we support those in need. That is what I believe we are doing. There is nothing fair about running a huge budget deficit and burdening future generations with the debts that we are not prepared to pay.
I have met several people in my constituency who are keen to work but who are prevented from doing so because they would be worse off. The time has come to make those changes and to ensure that we deliver real change for the future. The hon. Member for Hammersmith (Mr Slaughter) was talking about the impact on the local area in London, but let me tell him about my
vision not only for Chiswick, Brentford, Isleworth, Osterley, Hounslow and Hammersmith but for the rest of London and for the country beyond. I want to build confidence in people, no matter where they come from or where they live. I want to ensure that we build skills for the future and that we build hope and aspirations, so that we can get people back into work again. That is what I believe that the comprehensive spending review will do.
Those of us who spent many hours, days and years in business know that we can get better value for money in the public sector. As part of this plan we will look at each Department to see where we can simplify how we do things, where we can remove duplication and where we can add value. Those things are possible.
It is also important that we do not forget those organisations that play a key role across our many constituencies. Let me bring one to mind: Refuge, which deals with domestic violence. When local authorities and others are considering their budgets and prioritising their spending, I want to put in a word for organisations such as Refuge, which need support because they provide valuable services to the local community.
Finally, I want to touch on our investment for the future-that is, investment in infrastructure, in people and in growth. I commend the Government for their announced investments in Crossrail and in many of our roads-including in the Hounslow highways private finance initiative, for which we have support-and for their many other investment announcements. I agree with our Mayor that London plays a vital role as the engine of the UK economy and that investment in the capital is critical to the well-being of the economy overall.
We are also investing in schools, with the announcement of capital funding for and the refurbishment of schools. Several schools in my community-Chiswick Community, Hounslow Manor and Oaklands-need that support. They also need the support for the additional places that they will need for the future.
In this comprehensive spending review, the Government have had to deal with the economic realities and they have not shied away from their responsibilities. We are committed to cutting waste and reforming public sector services while at the same time investing in infrastructure, people and businesses to make this country successful for the future.
Angela Smith (Penistone and Stocksbridge) (Lab): Last Wednesday, the Chancellor took a huge gamble on the future of the UK economy. The CSR statement, coupled with the June Budget, will take a staggering £80 billion out of our economy over the review period. Never before has any Chancellor cut so deeply and so quickly.
The people who will pay the price for that squeeze on the state will not be the 18 or so millionaires who sit around the Cabinet table. No, the price for the Chancellor's gamble will be paid by people on council estates who will see rents rise dramatically, civil servants in my constituency who will lose their jobs and students who will see their debts treble.
We all agree that the deficit needs to be reduced to a sustainable level, but that should not be at the risk of weakening an already fragile economic position, and it
must be based on a strategy for growth and jobs-a strategy absent from the Chancellor's statement. The facts are that the Chancellor is hoping that export volumes will rise significantly over the period covered by the review. At the same time, according to the Chancellor's own figures, the economy will have to find an extra 2.5 million private sector jobs in the next five years.
To put that into perspective, during the last recession the UK managed to create 1.2 million jobs between 1993 and 1999. To get anywhere near the target that the Government have set themselves will require investment and an export boom on a scale that has never been achieved before-a point underlined recently by many political and economic commentators, including the well respected Will Hutton.
Although the £200 million to establish the elite research centres is certainly welcome and nothing new to us in south Yorkshire, where we already have the advanced manufacturing research centre, this investment is nowhere near enough, in the context of the sheer scale of the growth required, to rebalance the economy.
It is also important to remember at this point that the Government have already failed a key test on the support that they are prepared to give the private sector. In June they withdrew a Government commitment to fund the £80 million loan to Sheffield Forgemasters. Although I will not go into the stupidity of that decision now, it is clear, as the Business Secretary said in the Select Committee recently, that the nuclear reactor components at the heart of the proposed investment will now have to be manufactured abroad, and the UK will lose millions of pounds of exports to our international competitors. Surely that is not the way to go about rebalancing our economy.
How will 40% of cuts in funding to the higher education sector help to rebalance the economy? All that will do is damage our economic future. Also in further education, the Government are abolishing the education maintenance allowance, which has been recognised by many as a success. The Institute for Fiscal Studies, which is so obviously a thorn in the side of the Deputy Prime Minister, said that since the allowance was introduced, attainment at GCSE and A-level by recipients of EMA has risen by five to seven percentage points, and by even more for those living in the most deprived neighbourhoods.
That evidence is reinforced by college principals, who believe that many young people will not be able to stay in education and training without EMA, so why have the Government withdrawn a scheme which, in the great scale of things, costs relatively little and helps to give so many young people the skills desperately needed, if the Government are genuine about rebalancing the economy?
It is clear that the Government believe that private sector growth will, over the period, pull our economy on an upwards trajectory. I hope the Government have got that right, but I fear not. I fear that in a few months they will come back to the Chamber to revise the figures as the economy goes into a death spiral, and they will tell us that they cannot deliver the £17 billion savings and the cuts that they announced last week. That will not be achievable because unemployment will rise. The CSR is bad for Britain and bad for our economy. They should think again.
Mr David Hanson (Delyn) (Lab): Thirty-one Members from all parties and all parts of the House, including the Chair of the Treasury Committee, have contributed to the debate, which has been interesting and well informed. It is clear that there is a real divide between the Government and the Opposition on how to tackle the deficit, the impact of the CSR, and the fairness of the measures proposed by the Government.
The spending review will hit jobs, children and families. It will gamble with jobs. It will gamble with the growth of the British economy and, as my hon. Friend the Member for South Down (Ms Ritchie) said, that of Northern Ireland as well. The spending review will hit the most vulnerable in our society the hardest.
Kwasi Kwarteng: I am obliged to the right hon. Gentleman. He acknowledges that there is a deficit and his party acknowledges that it would have made cuts, so will he please tell the House where those cuts would have fallen?
The hon. Member for Colchester (Bob Russell) quoted the Bible at us. May I refer him to "Matthew", chapter 7, verse 16, and the notion, "By their deeds shall ye know them"? The spending review cuts too fast and too deep, and it rejects the sensible, balanced approach put forward by my right hon. Friends the Members for Edinburgh South West (Mr Darling) and for Kingston upon Hull West and Hessle (Alan Johnson).
The Government plan to take out of our economy and our spending £40 billion more than Labour thought sensible, so I was surprised to hear the hon. Member for Thurrock (Jackie Doyle-Price) call for more expenditure. Even the Office for Budget Responsibility thinks that the Government's measures will downgrade next year's growth forecast from 2.6 to 2.3%.
The Budget and the comprehensive spending review will hit jobs, essential services and, crucially, take public investment out of the private sector at a time when the Government want the private sector to grow. My hon. Friends the Members for Liverpool, Riverside (Mrs Ellman) and for Ochil and South Perthshire (Gordon Banks) and, indeed, the hon. Member for Macclesfield (David Rutley) recognised the importance of the public sector in helping to support future private sector investment.
We know, because the Chancellor admitted it last week, that 490,000 jobs will be lost in the public sector. The hon. Member for Dundee East (Stewart Hosie)
mentioned the impact on the defence sector, PricewaterhouseCoopers estimates that another 500,000 jobs will be lost in the private sector as a result, and my hon. Friend the Member for Nottingham South (Lilian Greenwood) described the impact of those losses. So let us not kid ourselves: the economy is still fragile. This week's announcement on growth over the last quarter still demonstrates that point and, put simply, throwing 1 million people out of work-out of the economy-will cost us more jobs than that and impact on the private sector in the long run.
The Government's measures will hit the private sector hardest. The hon. Member for Watford (Richard Harrington) talked about confidence, but confidence will fall if 1 million people are out of work. It will mean more people claiming benefits. As my hon. Friend the Member for Nottingham South said: fewer people in jobs, fewer people helping to grow the economy and higher welfare bills.
Government Members have been asking for it: there is an alternative to the Government's proposals. We clearly said in the Budget presented by my right hon. Friend the Member for Edinburgh South West in March that we would take steps to halve the deficit over four years.
"Labour lost because we failed to persuade the country we had a plan for the future."
Mr Hanson: The hon. Gentleman was not a Member in March, but if he had been, he would have seen our proposals to make efficiencies in policing, for which I was responsible at the time, of about £1 billion. He would have seen proposed efficiencies through savings on back-office staff, police procurement, public sector pensions and pay caps-a range of issues. The Conservative and Liberal Democrat policy, which has been brought before the House today, and which, by the way, we have not had sufficient time to debate, has been shown to be misguided. The people who will find it hard to get back into work will be hit hardest. [ Interruption. ] The right hon. Member for Rayleigh and Wickford (Mr Francois) has not even been in the Chamber most of the afternoon. He will whip Conservative Members to vote against child tax credits, child trust funds and the health in pregnancy grant, but he will not sit here and listen to the arguments about those issues.
There will be cuts in working tax credits for child care and a freeze on working tax credits, and people on jobseeker's allowance will be punished. As my right hon. Friends the Members for Barking (Margaret Hodge) and for Lewisham, Deptford (Joan Ruddock) and my hon. Friends the Members for Hackney North and Stoke Newington (Ms Abbott) and for Hammersmith (Mr Slaughter) said, cuts in housing benefit will exacerbate the problem. Women, children and the poorest in society will bear the brunt of these cuts.
As my hon. Friends the Members for Easington (Grahame M. Morris) and for Middlesbrough South and East Cleveland (Tom Blenkinsop) pointed out, the regions in the north of England will be hit the hardest,
with the loss of the pregnancy grant, the ending of contributions to the child trust fund, the scrapping of the savings gateway scheme, and the cutting of child benefit, which, as my right hon. Friend the Member for Croydon North (Malcolm Wicks) so eloquently pointed out, is an unfair approach to tackling the deficit. My hon. Friend the Member for Hammersmith also said that that will raise serious issues. Even today the Chief Secretary to the Treasury stated very strongly that there was not a problem in the Treasury with enforcing these policies. Well, let us find out downstream whether there is a problem when we see how he ensures that there is fairness between those who earn a top rate of tax, with two incomes, and those who earn a lower rate of tax, with one income. I will be interested to see how that works in due course.
The poorest 10% of the population will be hit hardest by the deficit reduction plan proposed by the Conservatives and the Liberals. Members need not take my word for it-it comes from the Treasury's own figures in the Red Book. Massive cuts to public spending will threaten vital local services, which my hon. Friend the Member for Stockton North (Alex Cunningham) mentioned with reference to the fire service. Capital spending benefits the private sector most, because it is not the public sector that spends money on building things in the economy-the private sector does that.
More widely, there are cuts to front-line policing, putting at risk Labour's record falls in crime and, as my hon. Friend the Member for Leicester West (Liz Kendall) noted, putting extra pressure on health and education services, despite pledges to support them.
Despite what the coalition would have us believe, this grossly unfair series of cuts is not inevitable-there is another way. The deficit was there because as a Government we faced a choice. Incidentally, the right hon. Member for Witney (Mr Cameron), as Leader of the Opposition, supported our deficit reduction plan and spending programmes. After much dithering, he supported us in taking measures to ensure that we did not let the United Kingdom slip into a depression. Members such as the hon. Members for Central Devon (Mel Stride) and for Watford do not realise that the official Opposition
supported us in ensuring that we took action to help to support the banks to keep people in their jobs and to keep people's mortgages alive.
That is unlike what happened in the recessions of the early 1990s, which I remember as a Member of Parliament, when we saw mortgages go up, houses repossessed, and jobs lost in their thousands. We took action to save those things on behalf of the British people, and we were proud to do so. The action that we took kept people in their jobs, kept people in their homes, and gave more businesses the support they needed than at any time during the 1990s. Through our action, inflation stayed at a historical low and plans were put in place to ensure that we saw a return to growth at the end of this year. We took that action to support the economy.
We need to bring the deficit down-certainly we do. We know that tough spending choices are needed, and in our Budget we looked at saving money on IT systems in the NHS, police overtime and welfare, and made £15 billion of efficiency and back-office savings on a range of other issues. They were important savings. [ Interruption. ] As my hon. Friend the Member for Streatham (Mr Umunna) says, we raised money through a higher and more effective banking levy.
This comprehensive spending review debate is about choices. It is about choosing whether the banks bear more of a burden than our children. It is about choosing whether we cut public services spending deeply or quickly-and we would not. It is about targeting new tax rises to fund £7.5 billion of capital spending in order to support jobs now. The Government are making the wrong choices. We are not "all in this together". They are gambling with jobs, gambling with growth, deepening unfairness, and increasing inequality. To cite a notable former Prime Minister, there is an alternative.
We announced our programme in our Budget in March, and we were elected-every single one of us-on that programme for the future. In the coming weeks and months, we will promote that alternative vigorously, expose this Government's reckless policies and ensure that we stand up for the ordinary, squeezed, middle-class people of this country and the people on lower incomes. We will reject the cuts where it is appropriate to reject them and support efficiencies where they should be made. [Interruption.] Again, the right hon. Member for Rayleigh and Wickford was not listening to what was said earlier. He has not been here listening to the debates and the arguments. I urge him and the House to reject this comprehensive spending review, support the Labour alternative and ensure that we defend the poorest in our society.
Last week my right hon. Friend the Chancellor stood in the House and set out a clear plan to pull Britain back from the brink, to deal with our debts and to put our nation's finances back on a sustainable path. When we came to power, we inherited an economy that was on its knees and took over from a Government with no
clear plan for getting it up and running. There was no strategy for recovery and no ideas for reform, and not a single penny of savings had been identified. If Opposition Members would like to intervene to tell me which of our spending cuts they would like to support, I would be very happy to take the intervention right now.
The right hon. Member for Delyn (Mr Hanson) talked about the March Budget, but it was a Budget and a plan that the British people rejected at the ballot box. While the Opposition are in denial, they will have no prospect of coming up with a plan to solve the grave problems that this country faces following 13 years of their being in government.
We took over when our country was borrowing £1 for every £4 it spent. We were running the highest deficit in our peacetime history and the highest in the G20. Britain was not living within her means, and the world knew it, as my hon. Friends the Members for Spelthorne (Kwasi Kwarteng) and for Central Devon (Mel Stride) pointed out. In fact, the previous year, the International Monetary Fund warned that we needed to accelerate deficit reduction. As my right hon. Friend the Member for Wokingham (Mr Redwood) said, that was critical to getting our country's finances back on track.
In May we announced immediate reductions in in-year spending, avoiding the sovereign debt crisis that was engulfing the eurozone. In June, we set out our emergency Budget, returning credibility to the nation's finances, and this October we have had the spending review, bringing years of irresponsible borrowing to an end and giving our country the best chance of keeping interest rates low, stimulating business investment and keeping mortgage rates low, and so helping families.
We have had to tackle the deficit-it has been unavoidable. However, we have chosen to spend the money that we have on the areas that matter most to Britain, which are the education of our children, the health care of our people and the infrastructure that sustains a prosperous economy. As my right hon. Friend the Chief Secretary said, underpinning all our decisions have been three guiding principles: first, the need to support growth; secondly, that our choices are fair; and thirdly, that we deliver reforms to our public services, making them fit for the 21st century. As the hon. Member for Redcar (Ian Swales) pointed out, those principles were entirely missing in the last Government's comprehensive spending review of 2007.
Angela Smith: Can the Economic Secretary give us any indication of the evidence that the Government have used to rely on the creation of 2.5 million new jobs in the private sector over the next five years?
Justine Greening: As the hon. Lady will be aware, we have set up the Office for Budget Responsibility, which is an independent office. It is the OBR that is predicting year-on-year falling unemployment and rising employment. I hear Opposition Members talking about 480,000 or 490,000 public sector job losses, but I am afraid they have to consider that the same report assesses that 1.6 million jobs will be created in the private sector. They cannot have it both ways.
Justine Greening: I will not, because we have had a long debate and I have three minutes to respond to each hour of it. I really do want to try to cover the points that hon. Members who participated raised. I apologise to the hon. Gentleman, but I want to respond to what has been said.
The bottom line is that if a country loses control of its finances, it loses the ability to choose how to spend its money, and its priorities become those of its debtors, not of its people. That is why we outlined a clear and credible plan to deal with the deficit when we came to government and that is why we will stick to it. The Government are firmly focused on achieving sustainable growth. Tackling the deficit will help to provide the strong economic bedrock on which the private sector can build, as my hon. Friend the Member for Esher and Walton (Mr Raab) pointed out.
Chris Williamson: This morning, I met a representative from the UK construction group that represents some of the largest construction companies in the country, which said that it did not recognise the growth figures that the Prime Minister quoted yesterday. It said:
"The 4% increase in construction turnover in"
"is unbelievable and does not reflect the mood of the major players".
Justine Greening: I was about to ask the hon. Gentleman to give way, Mr Deputy Speaker. The Government are spending slightly more on capital infrastructure than the previous Government, so heaven knows what the industry would have thought of Labour's plans. In the next four years, we will invest more than £30 billion in transport projects, £14 billion of which will fund maintenance and investment in our railways and £10 billion of which will be spent on road, regional and local transport schemes. We have created the new green investment bank to help finance sustainable infrastructure for the future and we have launched the £1.4 billion regional growth fund, which has rightly been welcomed by my hon. Friends the Members for Bristol West (Stephen Williams) and for Macclesfield (David Rutley).
Even when faced with the economic problems bestowed by the Labour party, we are still investing tens of billions of pounds in Britain's future. That goes alongside the reduction in corporation tax that we brought forward in the emergency Budget and the reduction in national insurance that we have also brought forward, scrapping the Labour party's jobs tax. The hon. Member for Wallasey (Ms Eagle) said that the spending review is not just about numbers, but I shall give her a number-400,000. That was the number of extra unemployed at the end of Labour's time in power, but Labour still wanted to introduce the jobs tax.
The hon. Members for Easington (Grahame M. Morris), for Stockton North (Alex Cunningham), for Middlesbrough South and East Cleveland (Tom Blenkinsop), for Penistone and Stocksbridge (Angela Smith) and for Nottingham South (Lilian Greenwood) all spoke of their concerns about the spending review and the cuts, but none of
them offered any alternatives. We hear about the Opposition supporting cuts, but we never find out which ones they support.
The second principle behind our decisions is to ensure fairness and make sure that those with the biggest shoulders bear the largest burden, while protecting the most vulnerable in our society. That is why the Government have restored the earnings link for the state pension and ring-fenced NHS funding. We want to give every child the best possible start in life by increasing the child tax credit for the lowest-income families and by protecting our investment in schools. There is nothing fair about not tackling the deficit and placing the millstone of debt that we currently have around the necks of our country's 20-somethings for the future.
Malcolm Wicks: Is it fair that when the cuts, including those to child benefit, are analysed, time and time again those who are hit the hardest are mothers and children? Does that make sense in terms of family policy?
Justine Greening: I do not accept that at all. The right hon. Gentleman needs to have a chat with the hon. Member for Hammersmith (Mr Slaughter), who was claiming that families on £79,000 a year are too rich to get support from the local council to access housing in London but too poor to have their child benefit withdrawn. That shows the incoherence of Labour's policy on the economy, particularly on welfare-a budget that accounts for almost £1 in every £3 that we spend.
As my hon. Friends the Members for Harrow East (Bob Blackman) and for Brentford and Isleworth (Mary Macleod) said in their powerful speeches, work simply does not pay in our welfare system. People are put on benefits with no prospect of ever being better off in work and, as my hon. Friend the Member for Eastbourne (Stephen Lloyd) pointed out, successive generations are condemned to a life of state dependency. Opposition Members might think that that is fair, but I do not. It is one reason why over the coming years and next two Parliaments the Government will introduce the universal credit-to make sure that people on welfare will always be better off by moving into work.
Mr Slaughter: The Leader of the House will confirm that at business questions today, I quoted the Mayor of London on the reduction of housing benefit, which he described as "Kosovo-style social cleansing." Since then, he has said:
"I do not agree with the wild accusations that reform will lead to social cleansing."
Justine Greening: That was a completely ineffective intervention. The hon. Gentleman ought to complain to Labour Front Benchers for their being so utterly ineffective at creating extra social housing in the capital during their many years in power. It was shocking how little affordable housing was created under the previous Government.
Even when spending is being reined in, we have found more resources for our schools and for the early-years education of our children. That has meant other Departments taking bigger cuts, but we believe that that
is the right choice for our country's future. The right hon. Member for Croydon North (Malcolm Wicks) quoted Eleanor Rathbone, who said that children are assets to the community. She was right, which is precisely why there will be a real increase in the money for schools in the next four years. In fact, my hon. Friend the Member for St Austell and Newquay (Stephen Gilbert) also recognised the importance of that. That is why the schools budget will rise from £35 billion to £39 billion, why we are maintaining cash spending on Sure Start, and why we are introducing a new £2.5 billion pupil premium to focus our resources on the children from the most deprived backgrounds in our country.
Our third and final principle in the spending review was public service reform. We are reducing back-office costs to free more resources for the front line. The right hon. Member for Barking (Margaret Hodge) spoke of the challenges of improving efficiency in government, but unlike her party when in power, we aim to be successful. We have started that process by finding every last penny of possible savings, and we are beginning to eliminate the monumental waste that became endemic in the past decade. We are tackling administration, improving procurement, and scrapping ineffective and expensive IT systems, which became a feature of the previous Government. When we started that process, we looked to make £3 billion of savings, but now we will make £6 billion of savings.
Finally, our reform agenda will see a massive devolution of power from the centre. Apart from schools and public health, we will end the ring-fencing of all Government grants to local authorities from April next year. More than 90 separate core grants to councils will be reduced to fewer than 10. Councils welcome that freedom even if the hon. Member for Leicester West (Liz Kendall) does not. We will change how services are delivered through increased payment by results and personal budgets, and by introducing new rights for communities to run services and own assets. We are therefore giving more powers to the front line and more to local government and communities-the very people who know their area best.
We are cutting the ridiculous levels of red tape that tie the hands of our police forces and so many other people who are working hard in the public sector to deliver the services on which our communities rely. Our
approach is different to that of the previous Government. By cutting waste and abolishing unnecessary targets, we will free the public sector to deliver a more efficient, transparent and better-tailored service to the people and communities who rely on them most.
Let me conclude the debate by saying that the decisions that we have taken have restored credibility to our public finances and stability to our economy. When the coalition Government came to power, we faced the worst economic inheritance in modern history. The previous Government spent our money like there was no tomorrow, but tomorrow has now arrived. The Labour Government left debts that undermined the funding of our public services and threatened every job in the country. They wanted to introduce a jobs tax at the very time when employers were crying out for help.
We have had to make tough choices, but they are the right choices. We are determined to ensure that everybody pays their fair share. I simply reject the comments of Opposition Members. As ever in such debates, they spent several hours explaining what they did not like, but simply failed to say what they did like. It is unacceptable to participate in such a debate without offering a meaningful alternative plan.
We have ensured that everybody pays their fair share. We are reforming welfare and cutting waste, and we are investing in growth, schools and health. That is how we will drive growth in this country and create jobs for the future. With no help from the Labour party, we have taken our country back from the brink of bankruptcy and we will build the more dynamic, prosperous and sustainable economy that Britain so badly deserves.
Mr Sam Gyimah (East Surrey) (Con): Thank you, Mr Deputy Speaker, for the opportunity to address this issue and for allowing my hon. Friend the Member for Enfield North (Nick de Bois) to speak too. This issue has affected several of my constituents, often referred to as the Crete five, as well as my hon. Friend's constituent, Andrew Symeou, who is a notorious example of the frailties of the legislation. The subjugation of an individual to the will of the state-any state-is an important issue and one on which the new Government are right to focus attention.
I commend the Government for appreciating that all is not right with our extradition treaties at present and that a review is a sensible step to address some of the concerns felt by many people. Without doubt, there are discrepancies between the justice systems of the many countries involved in extradition treaties. For example, a number of the offences for which a European arrest warrant can be issued are not crimes in this country. Indeed, many have fought hard so that racism and xenophobia do not become crimes in Britain. There are also clear differences between nations regarding prisoner rights and prison conditions, and these were at the forefront of the minds of the Crete five when they faced extradition proceedings earlier this year. Not only were they concerned by the initial summons they received, which was unclear as to its force and required them to appear in a Greek court just two weeks later, but they also feared a repeat of the case of Mr Symeou, who spent 10 months in a Greek jail without trial.
Those concerns remain very real for anyone facing the threat of extradition to a foreign country. Irrespective of innocence or guilt, the nature of the alleged crime or indeed nationality, certain standards must be maintained regarding the treatment of prisoners. That is as much a part of our justice system as the final verdict handed down, and we should expect our treaty partners to adhere to those same values.
At present, not enough safeguards exist to ensure that people are not sent to foreign prisons under foreign laws without good reason. The experience of many is that extradition is a fine thing only to someone who is running the criminal justice system. Individuals risk their whole life collapsing while they are hauled away without evidence and without hope of a trial any time soon.
We must be careful that the long-held, much cherished value of "innocent until proven guilty" is not swept under the carpet as simply the price we have to pay for international co-operation. I hope we do not move towards the French system, about which some have commented that people are seen as guilty from the moment the judicial system is interested in them. Judiciaries of any nation should have to provide some sort of prima facie evidence before extradition takes place. It cannot be right that an unfounded allegation based on evidence that would never stand up in a British court can lead to an extradition once a couple of boxes have been ticked.
There should be some element of proportionality in the system. I would venture that spending vast sums of money to extradite someone accused of stealing a piglet, as has happened recently, may somewhat diminish the power of the warrant when it is issued for more serious offences. The Government should seek assurances about the provision of legal aid and representation for extradited citizens. We must never send people overseas without any idea of whether bail will be granted or whether they will spend the next year of their life in prison with no trial date and no chance to clear their name. As we have seen in the case of Gary McKinnon, Britain should not be signing treaties that will allow other signatories to refuse to extradite when we are sacrificing that right. It is not in the interests of British citizens, and it leads to unbalanced treaty agreements.
There are many reasons for a review. It is long overdue, so I applaud the Government for acting so quickly on the matter. However, if I may, I would like to offer a word of caution. The European arrest warrant was introduced into British law in 2003. The then Prime Minister, Tony Blair, dismissed concerns raised by the Opposition, saying that
"there is one problem with the proposal for a large part of the Conservative party; it has got the word "Europe" in it."-[ Official Report, 12 December 2001; Vol. 376, c. 836.]
Although I recognise the politics he was playing, I would not agree with the substance of what he said. This is not an issue primarily about Euroscepticism. It is not a rant against all things European. It is to do with the British values that we hold and our determination to protect those values and our citizens wherever they are in the world.
I urge those conducting the review not to be browbeaten into believing that the valid concerns that were raised in 2003, and which will undoubtedly be raised again, are in fact nothing but the rantings of anti-Europeans. In fact, we have seen, with every day of this coalition Government, that co-operation between different tribes is a good thing. It gets things done, and can turn a desperate situation into a more promising outcome. So there are good reasons for having extradition treaties, and there were many good reasons when the Extradition Act 2003 was first passed. It is now quicker and easier to bring people to justice for the crimes they commit. They cannot just flee across the channel, and they cannot drop in and out of countries with scant regard for the law, and in the globalised world we inhabit, it is a tool we can use to combat one of the biggest challenges facing us-that of a terrorist threat which knows no borders and no nationalities.
At the time of the 2003 Act, however, concerns about how these laws would operate were raised from across the political spectrum. We ploughed on unbowed. Perhaps that was understandable. The events of 9/11 tipped the balance in favour of the EAW. The catastrophic nature of those events no doubt shaped much of our security policy in the following years, and the belief prevailed that "needs must" and that although the objections had some merit, they did not outweigh the need for immediate, decisive action. Now that those events, although still a constant reminder of the danger we face, are less pressing and less immediate, perhaps we can have a period of considered reflection under this review, so that we can begin to answer some of the questions that were batted away when the law was first introduced.
That is why a review is long overdue. Our allies have made the EAW work for them-for example, Germany has the sort of proportionality test I have mentioned-and I hope that the review does the same for Britain. Yes, if British nationals break the law, they must face justice, as should those from other countries who transgress here. However, every time we read about one of these cases I have mentioned, every time someone is mistreated in a foreign prison off the back of a loosely issued EAW, and every time a year of a young person's life is lost because of something that someone somewhere claims to have seen happen, we lose faith in this process as a proper tool of justice, and we retreat to an unhelpful position of instinctive distrust in international co-operation.
Nick de Bois (Enfield North) (Con): I congratulate my hon. Friend the Member for East Surrey (Mr Gyimah) on securing this important Adjournment debate. In the time permitted, I cannot review all the aspects of this matter, but I must focus on the key points as pertaining to my constituent, Andrew Symeou. Enfield has a unique and specific interest in the European arrest warrant and extradition, given that two of the current most high-profile cases exposing the system's failings involve Enfield residents-Andrew Symeou and, of course, Gary McKinnon. I and my constituency neighbour, my hon. Friend the Member for Enfield, Southgate (Mr Burrowes), hope and expect that the review of Gary McKinnon's case will mean that he is not the last victim of an imbalanced process, but the recipient of a new, just and proportionate approach. Perhaps the Minister can update us on that review.
My central premise today, however, is that for the last decade the European Union has been driven by procedural safeguards and processes, not defendants' rights, as moves to enhance speed and efficiency do so at the price, in this case-I believe-of a potential miscarriage of justice. Those who support the European arrest warrant do so because they believe that more criminals get caught. That is a noble goal, and one that I and, I am sure, all Members of the House fully support, but the performance of the warrant is flawed.
Sadly, those who criticise the operation of the European arrest warrant are often cast as apologists for wild European extremists, or organised crime and terrorism. That, of course, is arrant nonsense. For me, it is a question of balance. I do not believe that a system that produces potential miscarriages of justice at one level should be tolerated in the interests of speed at another. The application of the warrant without proper procedural guarantees has in some cases led to the denial of justice. One of those cases concerns my constituent Andrew Symeou. Andrew was in prison in Greece for 10 months awaiting trial on a charge of manslaughter. Until his final release on bail, the charge was one of manslaughter, although as testified by our High Court, there is sufficient evidence of what I can perhaps describe as the over-enthusiastic interrogation of witnesses. Indeed, there even appears to have been a case of mistaken identity. In Andrew's case and others, surely the European arrest warrant has been misused.
Let me summarise Andrew's experiences. In doing so, I hope in parallel to illustrate how the European arrest warrant has failed, and perhaps thereby help the review
by Lord Scott Baker. In short, there has been a failure to scrutinise the case by British courts for prima facie evidence; a lack of bail or euro-bail; a failure of mutual recognition; and, we must never forget, delayed justice for the family of the victim of that tragic incident, which led to the death of Jonathan Hiles-a delayed process that, three years on, leaves us with no one having come to trial yet. As much as anything else, that is not good for the family of the victim.
I cannot address all those issues, but let me turn to the point highlighted earlier, about submitting prima facie evidence prior to extradition. In British law, the Crown Prosecution Service makes the decision to charge individuals with criminal offences in complex cases. The decisions must be made fairly, independently and objectively. It is the duty of the CPS prosecutors to ensure that the right person is charged for the right offence. The key point is that when making a decision, the CPS will always decide whether there is enough evidence against the defendant. Therefore, the quality and reliability of that evidence will also be investigated, and cases progress only if there is considered to be a realistic prospect of conviction.
However, the EAW is based on one of 32 listed crimes in respect of which there is no need for a dual criminality test or any obligation to ensure that prima facie evidence is provided by the member state requesting extradition. Essentially, it requires us to go through a tick-box exercise. All that is required is that the judicial authority in the member state requesting extradition should detail the criminal offence believed to have been committed-that is, ticking the box-and indicate the length of sentence to be expected. In Andrew's case, he contested the request for extradition between 27 June 2008 and May 2009, but the court was able to examine only the process, and at no stage the facts of the case.
How powerless has British justice become when the High Court dismisses the appeal by the Symeou family even though in some instances it agrees that the evidence submitted shows that the local police investigation was flawed and when it could not rule out the possibility that the police were guilty of the manipulation and fabrication of evidence? How futile is our justice when it is decided that a young British man's future is not under our control, but is instead an argument to be had in Greek courts? Leave was granted to appeal to the House of Lords, but the House of Lords in turn rejected it.
The second point that I would like to consider in the time available is the issue of bail. When the European arrest warrant was agreed in 2002, it was with the understanding from all sides that this measure, which would have the effect of causing EU citizens standing trial to be held in prison in another member state, would be swiftly followed by measures guaranteeing their fair trial rights, as well as guaranteeing that there would be no miscarriages of justice. That promise was betrayed by member states when they failed to agree in 2004 to a proposal for a framework decision on procedural rights. All we can hope for now is, at best, a piecemeal approach.
The European Council is promising only to consider, not to legislate on, a so-called euro-bail, which would have helped my constituent who had been explicitly refused bail because he was a foreigner. Several years
ago, Lord Lamont predicted with characteristic foresight the plight of my constituent when he said:
"In some countries, bail is frequently refused to foreigners for fear they will abscond. In fact, there are several hundred British citizens on remand in Europe's prisons many of whom would have been released on bail if they were nationals of the country holding them."
Is it any wonder that my constituent and his family feel the UK Government have repeatedly let them down? Andrew was forced to languish in jail on remand for 10 months until June this year, yet with the existing EAW, one member state could all too easily have returned him, if he had been able to serve bail over here-under the European arrest warrant.
The emotional and financial cost to the family, who have remained supportive throughout, has been extraordinary. They have had to decamp to Greece to be with their son when he was first extradited 16 months ago. Their ability to continue to run their business and provide an income has been seriously compromised, but despite that, the family members have remained united and passionate in their campaign for justice for their son. They want him to have his day in court. I pay tribute to their courage and resilience in the face of this huge adversity.
To conclude, we should have an agreed framework of extradition for member states within the European Union-I accept that. The process needs to be fast, but should not be carried out without respect for an individual's right to a fair trial and a fair judicial process. At the heart of these flaws is the expected notion of mutual recognition between the judicial process in member states. The process of mutual recognition allows for miscarriages, as we have discussed. I suggest that a system of mutual understanding would suit the process of a European arrest warrant far better. Such a process would allow for reasoned debate before EAWs were acted on rather than allow European law simply to supersede our law. This would allow European warrants to be declined if the acts were viewed as non-criminal in the UK or the evidence was insufficient.
It seems perverse that hon. Members on both sides of the House were up in arms over the 42-day detention provisions of the last Parliament, yet we are willing to have our own citizens held in foreign prisons for far longer as a result of a flawed piece of legislation. Should we as a House accept that liberty and justice be sacrificed for expediency?
The Parliamentary Under-Secretary of State for the Home Department (James Brokenshire): I congratulate my hon. Friend the Member for East Surrey (Mr Gyimah) on securing this debate and on the measured way in which he delivered his comments this evening. I would also like to thank my hon. Friend the Member for Enfield North (Nick de Bois) for highlighting a number of issues about the European arrest warrant and for posing a number of questions about the operation of the system. In the time available, I shall try to address as many of the points highlighted by my hon. Friends as I can.
The European arrest warrant is an important mechanism in the administration of justice in the European Union, where citizens can move across its borders with relative freedom for the purposes of business or leisure. Of
course, no one sought for trial in the EU should be able to evade justice by crossing a border, which is why the warrant is important, but to be really effective it must command the confidence of those whom it affects, striking a fair balance between the rights of those sought and the rights of their alleged victims. For that reason, I welcome the opportunity this debate affords to explore some of the pertinent issues.
My hon. Friends have raised a number of points, and I would like to add some of my own. My hon. Friend the Member for East Surrey is aware that there is no ministerial involvement in European arrest warrant proceedings. A European arrest warrant can be issued only by a recognised judicial authority, and the decision about whether to order surrender is a matter for the courts in the country receiving the warrant. Having said that, I appreciate the concerns that my hon. Friend has expressed about the welfare of his constituent and his constituent's co-accused, who were surrendered on a European arrest warrant earlier this year to Crete to face serious criminal charges. I am aware of the circumstances of the case, in which another young man, Mr Robert Hughes-also a British citizen-was assaulted and very seriously injured.
The House will appreciate that I cannot comment on, and still less seek to intervene in, the judicial processes of another state. But I can say that the accused were surrendered to Crete in early August after their appeal rights under part 1 of the Extradition Act 2003, which gives effect to the European arrest warrant in the United Kingdom, were exhausted. Once there, they were granted bail on payment of a surety, and as far as the Foreign and Commonwealth Office is aware, they have been permitted to return to the United Kingdom pending the setting of a trial date.
My hon. Friend the Member for Enfield North mentioned the case of his constituent, Andrew Symeou. Mr Symeou was surrendered to Greece on a European arrest warrant last year, where he is accused of the manslaughter in 2007 of Mr Jonathan Hiles, also a British citizen. I can certainly confirm the advice received from the Foreign and Commonwealth Office that Mr Symeou is now on bail in Greece and awaiting trial in March next year. The trial was postponed from June this year because summonses for British witnesses were regrettably not able to be served on time. This is self-evidently distressing for all those involved in this tragic case, but I trust that the delay will not result in a denial of justice to any of the parties. I can assure the House that the unit in the Home Office that processes summonses from overseas has flagged its system with the names of these witnesses. That means that when the summonses containing the necessary information are re-sent by the Greek authorities, they will be identified promptly and served on the witnesses.
It would not be appropriate for me to comment further on individual cases, but in general terms Members will be aware that the Extradition Act 2003, and the various treaties and instruments to which it gives effect, contain a range of safeguards for the person whose extradition is sought. These safeguards are in place to strike a balance between the rights of the requested person and the rights of their alleged victim or victims, as I said earlier. It is important that suspects are quickly brought to justice, and that is no less the case when the offence has cross-border elements.
My hon. Friend the Member for Enfield North mentioned that a European arrest warrant may be issued when a fugitive is merely required for investigation. I can reassure him on that point. The instrument states categorically:
"The European arrest warrant is a judicial decision issued by a Member State with a view to the arrest and surrender by another Member State of a requested person, for the purposes of conducting a criminal prosecution or executing a custodial sentence or detention order."
I hope that that provides a measure of clarification. He also made the general point that, in cross-border cases, bail is often denied to defendants who are not residents of the country in which they are charged. He might be aware that another EU criminal justice measure, the European supervision order, was adopted last year. It is not yet in force, but it will provide for a more flexible system of bail in cross-border cases. In any event, decisions on bail, whether here in the United Kingdom or abroad, are a matter for the trial court, which will be mindful of the importance of ensuring the attendance of defendants.
The coalition Government are aware of the public interest in the United Kingdom's extradition arrangements, and I have noted with care the comments that my hon. Friends have made in this regard. That is why my right hon. Friend the Home Secretary announced a judge-led review of our extradition arrangements to Parliament on 8 September. On 14 October, the coalition Government announced that the independent review would be led by Sir Scott Baker, a former Lord Justice of Appeal. He will be supported by two lawyers with wide experience and in-depth knowledge of extradition law. The operation of the European arrest warrant will be looked at as part of the review to ensure that it operates as effectively as possible and in the interests of justice. In her statement to the House, the Home Secretary announced that the five issues that would be covered by the review were the
"breadth of Secretary of State discretion in an extradition case; the operation of the European arrest warrant, including the way in which those of its safeguards which are optional have been transposed into UK law; whether the forum bar to extradition should be commenced; whether the US-UK extradition treaty is unbalanced; whether requesting states should be required to provide prima facie evidence."-[ Official Report, 8 September 2010; Vol. 515, c. 18WS.]
The issue of prima facie evidence is one of those that are under review as part of the investigation. It is a long time-nearly 20 years-since prima facie evidence has been required to support an extradition request between European countries. The European convention on extradition, which preceded the European arrest warrant in the EU, abolished the requirement for prima facie evidence. The United Kingdom implemented the convention in 1991, when the Extradition Act 1989 came into force. My hon. Friend the Member for Enfield North asked about the case of Gary McKinnon. The Home Secretary obtained an adjournment of the High Court hearing so that she could consider the issues for herself, along with further representations from Mr McKinnon. She can legally stop extradition at this stage in the proceedings only if she concludes that Mr McKinnon's human rights would be breached if he were extradited. She is actively considering those issues with a view to reaching a decision as soon as possible.
Mr Gyimah: The Minister has mentioned the Home Secretary's involvement in the Gary McKinnon case. Would it not be helpful to ensuring justice if she became more directly involved in other extradition cases? At present, political involvement is completely absent from extradition.
James Brokenshire: As I have said, the extradition review will consider a range of issues relating to extradition arrangements. Obviously I do not want to prejudge the outcome of the review, but I am sure that the hon. Gentleman's point will have been heard very clearly.
A number of concerns have been expressed about the European arrest warrant, but, as Members have pointed out this evening, it has been an invaluable tool in the fight against international crime within the EU. The European arrest warrant system has simplified and speeded up the extradition of persons both to and from the United Kingdom, and has made possible some procedures that were not formerly possible. Before the warrant was introduced, some EU member states had a constitutional bar on the extradition of their own nationals. The warrant has removed that barrier to extradition, and has updated or streamlined the extradition process in a number of other ways.
An increasing number of European arrest warrants are being dealt with in the United Kingdom. They are issued for a range of different offences. For an offence to be extraditable, it must be punishable by the law of the issuing member state with a custodial sentence for a maximum period of at least 12 months, or, when sentence has been passed, with a sentence of at least four months. Offences that fall into one of the categories on the list contained in the European arrest warrant framework decision-all serious offence types-and that are punishable with a maximum sentence of at least three years in the issuing state may not be subject to the dual criminality test in the executing state. However, for the purposes of all other offences, the United Kingdom has implemented an optional further safeguard, and requires that the offence must also be an offence in the United Kingdom. The EU is actively exploring the best means of addressing the issue of proportionality in the number of warrants issued, and the United Kingdom is playing a leading role in its discussions.
When it comes to justice and home affairs in the EU, the picture is constantly evolving. The Government have decided to opt into the EU directive on the right to information in criminal proceedings. Opting in will help to protect the civil liberties of our citizens abroad without compromising the integrity of the United Kingdom justice system.
My hon. Friend the Member for East Surrey mentioned legal aid. Legal assistance is an issue that is included in the Stockholm programme and the Commission is introducing a proposal on legal assistance for consideration next year.
I am pleased to have had the opportunity to debate the United Kingdom's extradition arrangements with member states of the European Union. Clearly, the issue is being examined carefully as part of the review that I have highlighted. That is why the review has been set up. It will report next summer, after thorough consultation-