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House of Commons

Wednesday 26 January 2011

The House met at half-past Eleven o'clock


[Mr Speaker in the Chair]

Oral Answers to Questions


The Secretary of State was asked-

Business Growth

1. Mark Menzies (Fylde) (Con): What recent steps he has taken to promote business growth and inward investment in Scotland. [35124]

The Secretary of State for Scotland (Michael Moore): Before I answer the question, may I pay tribute to Mr Phil Gallie, whose passing has sadly been announced this week? He served this House and his party well while he was here, and he went on to serve his party and his constituents with distinction in the Scottish Parliament. He did that rare but important thing-while a feisty defender of his party's positions on all sorts of things, he became popular across party lines. Our condolences go to his family.

Economic growth is at the centre of the Government's agenda for this Parliament, and I promote that agenda in my regular engagements with the business community in Scotland and the UK and with international partners.

Mark Menzies: May I join the Secretary of State in his condolences to the family of Phil Gallie, a fellow Ayrshireman and someone I knew well?

The Secretary of State mentioned the efforts to promote jobs. Will he update the House on what he has done to follow up on the visit of the vice-premier of China, in particular on the trade links between Scotland and China?

Michael Moore: A very significant part of the vice-premier's visit, which of course we welcomed enthusiastically here in the United Kingdom, was that he started it in Scotland. I had the great privilege of welcoming him to the UK on behalf of the Government. In the course of that visit, we in Scotland and the rest of the UK were able to see very clearly the opportunities for us to develop our plan to be partners for growth, whether in renewable energy or in many other spheres.

Mr Brian H. Donohoe (Central Ayrshire) (Lab): May I add my condolences to those expressed to the family of Phil Gallie? He and I came into this place on the same day, and I have to say that he was more working-class than most Labour MPs are today, and a feisty fighter as well.

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Does the Secretary of State think that inward investment to Scotland would be helped if Glasgow Prestwick airport were renamed Robert Burns airport?

Michael Moore: From one great defender of Ayrshire to another. The family will be pleased to hear the hon. Gentleman's tributes to Phil Gallie. As far as the hon. Gentleman's idea for the renaming of the airport is concerned, I am sure that those who make such decisions will have heard him.

Sir Robert Smith (West Aberdeenshire and Kincardine) (LD): As the Secretary of State will know, the north-east of Scotland and Aberdeen is a powerhouse of the UK economy, providing much-needed tax revenues and inward investment. Crucial to the future of attracting inward investment is good communications technology. Will he meet me to discuss the barriers that mean that we have not yet seen the next generation of broadband reach Aberdeen and the north-east of Scotland?

Michael Moore: First, I agree with my hon. Friend about the importance of Aberdeen and the regional economy not just for Scotland but for the UK as a whole. He is right to emphasise that. I met senior business leaders in Aberdeen only a few weeks ago, and we discussed how they could develop growth. Broadband is an important part of that, and he will be aware of our plans to speed up the introduction of superfast broadband. I would be delighted to meet him to discuss the matter further.

Angus Robertson (Moray) (SNP): I associate myself and my colleagues with the condolences in relation to Phil Gallie's death.

Does the Secretary of State understand that thousands of individuals and businesses the length and breadth of Scotland are suffering because of rocketing fuel prices?

Michael Moore: I recognise that the increase in fuel prices is a real challenge for individuals and businesses, which is why the Government are looking carefully at ways in which we can tackle that issue, including proposals for a fuel duty stabiliser.

Angus Robertson: But it was two years ago that the Liberal Democrats promised a rural fuel duty derogation. What specific action have the UK Government taken with the European authorities to secure that? Specifically, has a formal request been made to the European Commission to make it possible?

Michael Moore: Referring to the hon. Gentleman's earlier point, it is important for Scotland and the whole UK to get a fuel duty regime that reflects the challenges that exist, particularly in rural parts of the country. On the derogation specifically, he will be aware that the Government are working very hard to ensure that we can get the right processes in place in Europe, so that we get the pilot up and running as quickly as possible.

Mr Alan Reid (Argyll and Bute) (LD): I welcome the Government's moves towards a lower rate of fuel duty for the islands, but under the plans that they inherited from the Labour Government, fuel duty is due to go up by more than 4p a litre in the Budget. The rural economy could not stand such an increase, so I hope that the Secretary of State will tell the Chancellor not to go ahead with Labour's 4p increase.

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Michael Moore: I know the particular challenges in my hon. Friend's area, where some of the highest fuel prices in the whole country can be found. His representations to me and to the Chancellor are carefully noted, and of course the decision on the future of fuel duty will come in the Budget.

Ann McKechin (Glasgow North) (Lab): Good transport links to other parts of the UK are vital for the Scottish economy. As the Secretary of State is aware, I wrote to him and to the Secretary of State for Transport on Monday last week to express my concerns about reports that bmi is about to axe its Glasgow-Heathrow service, which will put more than 100 jobs at risk. To date, I have had no reply from either him or his colleague. Will he inform the House today what steps he and his Government are taking to persuade both bmi and BAA to save that vital transport connection?

Michael Moore: I recognise the hon. Lady's concerns, which are shared by people not just in Glasgow, but across Scotland. I have spoken to senior managers both at bmi and BAA, and it is clear that they have some very difficult contractual arrangements as a result of the review of landing charges at Heathrow. I am keen that they recognise-I impressed this upon them-the importance of those links to Glasgow and to Scotland.

Ann McKechin: I am grateful for the Secretary of State's response, but given that there is increasing evidence that domestic air links between Scotland's major airports and the UK's largest airport might be substantially diminished, and the inevitable worries that increased fares will result if there is only one remaining carrier, will he undertake today to make contact with the EU, which is responsible for regulation, and ask it to consider possible changes better to protect strategically important domestic air links, and to ensure better competitive practices to protect Scotland's economy and our customers?

Michael Moore: If I may be forgiven, I am not sure that I remember the previous Labour Government doing that. I do not want us to lose sight of the fact that Glasgow, Edinburgh and other major Scottish cities have a range of links to different London airports-substantial links that we want to be enhanced and to grow. The issue that the hon. Lady raises is obviously one of concern, and the Government will continue to discuss it with the parties involved.

Calman Commission

2. Iain Stewart (Milton Keynes South) (Con): What progress the Government have made on implementation of recommendations of the Calman Commission on Scottish Devolution; and if he will make a statement. [35125]

6. David Mowat (Warrington South) (Con): What progress the Government have made on implementation of recommendations of the Calman Commission on Scottish devolution; and if he will make a statement. [35129]

The Secretary of State for Scotland (Michael Moore): The coalition agreement contained a commitment to implementing the recommendations of the Commission
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on Scottish Devolution, which is also known as the Calman commission. The Government introduced the Scotland Bill on 30 November-St Andrew's Day-2010. The Bill will have its Second Reading in this House tomorrow and I look forward to hon. Members taking part in the debate.

Iain Stewart: I very much welcome the provisions in the Scotland Bill to make the Scottish Parliament more fiscally accountable, but can my right hon. Friend give me an assurance that the business community on both sides of the border will be fully consulted about the implementation of the tax powers, so that it does not suffer an undue administrative burden?

Michael Moore: I welcome my hon. Friend's comments-I know that he has more than a passing interest in those particular powers. I can give him absolutely the assurance that he wants. Through the high-level implementation group, which brings together experts from a range of bodies, and Her Majesty's Revenue and Customs technical groups, we are consulting very carefully and taking on board all the comments being made.

David Mowat: Calman acknowledged that the Barnett formula no longer reflected need. As a consequence, constituencies such as mine-Warrington South-receive many millions of pounds per year less than equivalent constituencies in Scotland. Does the Minister have any plans to amend the Scotland Bill to put the allocation on to a basis of need?

Mr Speaker: All I will say to the Secretary of State is that that question is very wide of the considerations of the Calman commission, and I feel sure that he will be dextrous enough to provide an orderly reply.

Michael Moore: The answer is no.

Mr Speaker: I am confirmed in that view.

Stewart Hosie (Dundee East) (SNP): The problem is that the recommendations of the Calman commission are not being implemented-they are not in the Scotland Bill. The proposal on the aggregates levy, the proposals for the devolution of the marine environment and the proposal on air passenger duty have all been abandoned. Is that a lack of imagination on the part of this Government, or merely a lack of ambition for Scotland?

Michael Moore: We certainly do not lack ambition for Scotland. We have a set of proposals that are being thoroughly scrutinised in the Scottish Parliament, and from tomorrow, they will be scrutinised in the House as well. As far as the specifics are concerned, the hon. Gentleman will be aware that, in respect of the aggregates levy, we have said that given the current court case, it is inappropriate to devolve that just now, but we will do so in future. I recommend that he goes back to the Command Paper and studies it carefully.

Value Added Tax

3. Gordon Banks (Ochil and South Perthshire) (Lab): What recent discussions he has had with the Chancellor of the Exchequer on the effect in Scotland of the increase in the basic rate of value added tax. [35126]

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The Parliamentary Under-Secretary of State for Scotland (David Mundell): May I associate myself with the Secretary of State's comments on Phil Gallie? Phil was a true, great Conservative in Scotland.

I have regular discussions with the Chancellor of the Exchequer on a range of issues. The VAT rise is a tough but necessary step towards Britain's economic recovery. Income tax and national insurance increases would have had a more damaging impact on poorer people in our society.

Gordon Banks: Almost half the respondents to a recent survey by the Federation of Small Businesses said that they would increase prices because of the VAT rise, and 45% of those respondents said that the rise would decrease turnover and have an obvious impact in hindering job creation and growth. How can the Secretary of State and the Minister continue to sell out the people of Scotland and support this abysmal tax rise?

David Mundell: How can the hon. Gentleman continue to fail to take responsibility for his Government's record, which took our country to the brink of bankruptcy and required the VAT rise to fill the black hole? If anyone is responsible for the issues that Scottish business currently faces, it is his Government.

Business Confidence

4. Fiona Bruce (Congleton) (Con): What assessment he has made of recent trends in business confidence in Scotland. [35127]

7. John Stevenson (Carlisle) (Con): What assessment he has made of recent trends in business confidence in Scotland. [35130]

9. Mike Freer (Finchley and Golders Green) (Con): What assessment he has made of trends in business confidence in Scotland. [35132]

The Secretary of State for Scotland (Michael Moore): Returning the UK to sustainable economic growth is the Government's overriding priority. The Government are doing everything they can to create the conditions that enable all businesses to be successful and create more jobs.

Fiona Bruce: Business organisations have welcomed the Government's plans to reduce the headline rate of corporation tax and simplify the tax system. Does the Secretary of State agree that cuts are vital for boosting enterprise?

Michael Moore: I welcome my hon. Friend's comments and reinforce the points made by my hon. Friend the Under-Secretary a moment ago. The priority for economic growth in this country is to cut the deficit of £155,000 million that we inherited from Labour. Cuts in corporation tax, reducing the national insurance burden and keeping interest rates low are important parts of the package.

John Stevenson: Given the over-reliance on the public sector in Scotland, does the Secretary of State agree that the Scottish Government should be following the policies of the national Government by encouraging private sector investment and ensuring a balanced economy?

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Michael Moore: We certainly believe that the private sector has a central role to play in returning us to sustainable growth in this country, whether in Scotland or the rest of the United Kingdom. The Scottish Parliament debates the Scottish Government's budget this afternoon and no doubt some of these points will be made in that debate.

Mike Freer: Is the Secretary of State worried that the Scottish Government's plans to introduce a business surcharge will damage business confidence?

Michael Moore: The Scottish Government have received serious representations on their proposals, and I am confident that those will be debated extensively this afternoon.

Mr Frank Roy (Motherwell and Wishaw) (Lab): A double dip in the housing market in Scotland would be a disaster for the country. What discussions has the Secretary of State had with Scottish banks about more flexible lending?

Michael Moore: The hon. Gentleman will be more familiar than most with the situation that we inherited, in which bank lending-to businesses or to householders-was not in a good state. We are determined to increase the amount of lending and I have regular discussions with the banks on a range of issues. This issue is a central part of those discussions.

Dr Eilidh Whiteford (Banff and Buchan) (SNP): Will the Secretary of State accept that business confidence will have been extremely dented by yesterday's appalling growth figure announcements? Will he now accept that the Government's cuts go too far, too fast, and will the Government now pull back from this reckless course?

Michael Moore: I recognise that yesterday's growth figures were very disappointing. We have said for months that the recovery would be choppy. There are special circumstances about the weather in yesterday's announcement, which she will be aware of. But if we do not tackle the deficit, introduce measures to help businesses to grow or invest in infrastructure and science funding, we will not get the recovery from the situation that we inherited from the Opposition.

Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op): In the Secretary of State's last answer, he referred to investment in infrastructure. He will know, from the Scottish business organisations that are in London today to appear before the Select Committee, that an important part of increasing confidence is having the right transport links and access to markets. Given that, and the future of the Secretary of State for Wales notwithstanding, will the Secretary of State clear up the confusion on his position on High Speed 2 and its extension to Scotland? I know from the discussions a couple of weeks ago that people from Glasgow and Edinburgh are slightly confused about where he stands. Can he clear this up and put on the record his support for High Speed 2 being extended to Edinburgh and Glasgow for the future of the economy of the whole UK?

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Michael Moore: I would not accuse the hon. Gentleman of wilfully misinterpreting the outcome of that particular meeting. I was pleased to arrange the meeting between the leaders of Glasgow and Edinburgh councils and my right hon. Friend the Secretary of State for Transport, who is sitting on the Front Bench. I am a passionate supporter of high-speed rail coming to Scotland, as is my right hon. Friend and the rest of the Cabinet.

Tuition Fees

5. Pete Wishart (Perth and North Perthshire) (SNP): What assessment he has made of the likely effect on universities in Scotland of the increase in the maximum fees chargeable by universities in England. [35128]

The Parliamentary Under-Secretary of State for Scotland (David Mundell): Education is devolved, and the hon. Gentleman will be aware that the Scottish Government are currently consulting on the future of higher education in Scotland. The UK Government are developing a White Paper on higher education in England that will fully consider the effect of their proposals on higher education in the devolved Administrations.

Pete Wishart: I am grateful to the Minister for that answer, although it was not quite an answer to my question. He will know, as I do, that the tripling of university fees in England will bring nothing but pain and misery to Scottish universities and Scottish students, whether in funding or support for students, or through the intolerable pressure on the Scottish Government to respond. What does he have to say to the university students who will suffer so much because of the appalling decision made by his party and the Scottish Liberals?

David Mundell: Higher education in Scotland is devolved. The UK Government are taking account of the impact of their policies in Scotland, but I tend to agree with Sir Andrew Cubie when he said that the Scottish Government were behind the curve in responding to the Browne report and bringing forward their own proposals. They are followers, not leaders. [ Interruption. ]

Mr Speaker: Order. There is a constant hubbub in the Chamber. People outside must think that it is extremely discourteous.

Mr Charles Kennedy (Ross, Skye and Lochaber) (LD): The Minister should be aware that what is not devolved are decisions on research funding-decisions that are arrived at here in Westminster and which will have an impact, not least for those Russell group universities in Scotland. Will he give us an undertaking that he will ensure that the Secretary of State for Scotland stays closely in touch with Mike Russell's all-party working group at Holyrood, so that whatever the political composition after May, we get an outcome for Scottish universities that does not replicate the errors of policy judgment that have sadly been arrived at here?

David Mundell: I am happy to give my right hon. Friend an undertaking about the Scotland Office liaising with the relevant Scottish Parliament committee, and also to assure him that the Scotland Office works closely with Universities Scotland on all issues affecting universities in Scotland.

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Bank Bonuses

8. Anas Sarwar (Glasgow Central) (Lab): What discussions he has had with ministerial colleagues on the level of employee bonuses to be paid by banks based in Scotland. [35131]

12. Eric Joyce (Falkirk) (Lab): What discussions he has had with ministerial colleagues on the level of employee bonuses to be paid by banks based in Scotland. [35135]

The Secretary of State for Scotland (Michael Moore): With permission, Mr Speaker, I will answer questions 8 and 12 together. I have regular discussions with ministerial colleagues on a range of issues. As the predominant shareholder in RBS, the Government expect the bank to be a back-marker and not a market leader on bonuses. People across the country are having to make adjustments as we come out of recession and repair our public finances. Everyone expects bankers to be part of this process.

Anas Sarwar: Given that the Financial Services Authority report found that 1.1 million customer complaints were made against RBS in one year and that more than 50% were shown to have been dealt with inappropriately, does the Minister think it appropriate for RBS executives to receive lavish bonuses this year, and if not, what is he going to do about it?

Michael Moore: On the issue of bonuses, as we have made clear, we have inherited an arrangement with RBS that was put in place by the last Government-the hon. Gentleman's Government, not this one-to pay bonuses at market rates this year. We want to see bonuses lower this year than last year. That is absolutely clear-cut. As far as customer service is concerned, the hon. Gentleman makes an important point, and I am sure that RBS managers will have heard it.

Mr Speaker: Eric Joyce is not here.

Mr Ian Davidson (Glasgow South West) (Lab/Co-op): With the collapse of the Bank of Scotland and the Royal Bank of Scotland, does the Minister agree that an independent Scotland would be as successful as Ireland and Iceland at the moment?

Michael Moore: The hon. Gentleman makes an astute point as ever.

Driving Standards Agency

10. Mr Mike Weir (Angus) (SNP): What recent discussions he has had with the Driving Standards Agency on its operations in Scotland. [35133]

The Parliamentary Under-Secretary of State for Scotland (David Mundell): I have had no such discussions with the agency. However, the hon. Gentleman will know from the Westminster Hall debate that he secured on the proposed closure of Arbroath and Forfar driving test centres that the Under-Secretary of State for Transport, my hon. Friend the Member for Hemel Hempstead (Mike Penning) has agreed to look further into the arrangements surrounding driving test centre closures.

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Mr Weir: The Minister is obviously aware that local driving test centres in rural areas such as Angus are being closed without any consultation whatever, with services moved to multi-purpose test centres. Does he accept that this is an unacceptable way for a Government agency to act? Will he press the Secretary of State for Transport, who I notice is sitting two along from him on the Front Bench, to impose a moratorium on closures until, at the very least, there is adequate consultation with local communities before the removal of such important services?

David Mundell: I commend the hon. Gentleman for his diligence in pursuing this issue, as he also did in his Westminster Hall debate. He knows that the Transport Minister took away the issues that he raised in that debate and agreed to look into them.

Energy Industries

11. Mike Crockart (Edinburgh West) (LD): What assessment he has made of the effects of the outcomes of the recent state visit to Edinburgh and London of the vice-premier of the People's Republic of China on the renewable and low-carbon energy industries in Scotland. [35134]

The Secretary of State for Scotland (Michael Moore): China and the United Kingdom are key partners for growth in the future. This visit was another positive step in strengthening relationships, and it confirms Scotland's reputation as a world leader in the continuing development and application of the new technology that helps to deliver clean green energy globally.

Mike Crockart: I thank the Secretary of State for his answer. Does he agree that investment worth £6 million in Scottish companies by the largest energy consumer in the world will provide a perfect showcase for the benefits of green technology? Does not the fact that Edinburgh seems set to see the creation of a renewable energy cluster in Leith docks further the case for the city to be the location for the new green investment bank? [ Interruption. ]

Mr Speaker: Order. There is far too much noise in the Chamber. That is unfair on the hon. Member asking the question, and on the Minister answering it. It also sends out a very bad signal to those listening to our proceedings.

Michael Moore: Thank you, Mr Speaker.

On my hon. Friend's first point, may I just emphasise what I said earlier, which was that the vice-premier was very impressed by what he saw of Scotland's renewable energy sector when he visited Edinburgh, and not only by the presentations that he saw about the country's potential but specifically by seeing the Pelamis factory in Leith? My hon. Friend also makes a strong and compelling case for the green investment bank, and we will announce details of that shortly. We look forward to making an announcement about its location at an appropriate moment.

Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op): I welcome the support that the Secretary of State has given to the establishment of the green investment
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bank headquarters in Edinburgh. Given that leading economists have said this morning that Scotland faces an even greater danger than the rest of the UK of a double-dip recession, does he accept that the decision on the location of the bank should be taken sooner rather than later? We want it to be set up so that we can have the advantage of the jobs that it will bring now, not in three or four years' time.

Michael Moore: Unlike the previous Government, we have actually made a firm commitment to the green investment bank, and we intend to deliver on that. We will be making further announcements on the detail as soon as possible.

Devolved and Reserved Powers

13. Miss Anne McIntosh (Thirsk and Malton) (Con): What recent representations he has received on the boundaries between devolved and reserved policy matters; and if he will make a statement. [35136]

The Parliamentary Under-Secretary of State for Scotland (David Mundell): The Commission on Scottish Devolution was established to look into this issue, and we are taking forward recommendations of the commission in the Scotland Bill.

Miss McIntosh: Will my right hon. Friend take the opportunity to revisit the boundaries between reserved and devolved areas in farming matters? Does he believe that we in England could benefit from the way in which the common agricultural policy has been applied in Scotland?

David Mundell: The Calman commission looked at these issues across the full spectrum and determined that there was no need to make any changes in respect of agriculture, other than in respect of certain aspects of animal health funding. [ Interruption. ]

Mr Speaker: Order. The House must come to order. I want to hear Mr Robert Halfon.

Scottish Parliament (Financial Accountability)

14. Robert Halfon (Harlow) (Con): What recent representations he has received from the Scottish Executive on the financial accountability of the Scottish Parliament. [35137]

The Parliamentary Under-Secretary of State for Scotland (David Mundell): The most recent such representations related specifically to the financial provisions of the Scotland Bill, received around the time of its introduction on 30 November 2010. Since May last year, Scotland Office Ministers have not received any representations from Scottish Ministers describing the detail or the estimated economic impact of any alternative proposals to deliver financial accountability to the Scottish Parliament.

Robert Halfon: On average, the Government spend about £7,000 a year per person in England, but they spend about £8,500 per person in Scotland. What comfort can the Minister give to my hard-pressed taxpayers in Harlow that their money is being spent wisely?

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David Mundell: The Government understand that concerns have been expressed about the Barnett formula, but their priority is the stabilisation of the public finances. That is our priority for this Parliament.

Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP): While the VAT rise was swift, we are still waiting for the rural fuel derogation in the islands. In my constituency, fuel costs £1.45 a litre, but I have information that, in the tiny Faroe Islands, the prices is 94p a litre for diesel and £1.10 for petrol. The islands control their own fuel taxation. Should not Scotland, with 5 million people, have at least the powers of an island group of 48,000?

David Mundell: I would have thought that the hon. Gentleman would be pleased that we finally have a Government who are taking forward the issue of fuel prices in remote and rural areas and who are looking to hold a pilot in constituencies such as his to establish how exactly it would operate in practice.

Chinese Vice-Premier (State Visit)

15. Mel Stride (Central Devon) (Con): What the outcome was of the recent visit to Scotland of the vice-premier of the People's Republic of China; and if he will make a statement. [35138]

The Secretary of State for Scotland (Michael Moore): I had a very constructive meeting with Vice-Premier Li Keqiang, which builds on the existing relationship between our countries. As I said in response to an earlier question, China and the UK are key partners in growth for the future.

Mel Stride: While I welcome the commercial success of the Chinese deputy premier's visit to Scotland and recognise the importance of China having good relations with Scotland, does my right hon. Friend agree that it is most important for the Government to continue to press the Chinese Government on the issue of human rights and also to call for the prompt release of the Nobel peace laureate, Liu Xiaobo?

Michael Moore: I can reassure my hon. Friend that in the course of the extensive visit by the vice-premier, we not only focused on our important commercial ties and developing our partnership for growth, but took the opportunity to have an ongoing dialogue about human rights and other issues. We will continue to do that-and I believe we will be successful.

Prime Minister

The Prime Minister was asked-


Q1. [35931] Mr Gregory Campbell (East Londonderry) (DUP): If he will list his official engagements for Wednesday 26 January.

The Prime Minister (Mr David Cameron): I am sure the whole House will want to join me in sending our deepest condolences to all those affected by the appalling terrorist attack in Moscow on Monday. Our thoughts
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should be with the families of all those killed and injured, but especially with the family of Gordon Cousland of the United Kingdom. I spoke to President Medvedev on Monday evening and offered him our complete support in ensuring that the terrorists should never be allowed to win.

This morning, I had meetings with ministerial colleagues and others, and in addition to my duties in the House, I shall have further such meetings later today.

Mr Campbell: On behalf of my colleagues, I wish to join in the tribute that the Prime Minister has paid. We would also wish to send our best wishes to a soldier from Northern Ireland who was injured in Afghanistan last week.

Every week, £600 million in fuel duty flows into the Treasury from hard-pressed motorists right across the United Kingdom. That is £600 million each week since the Prime Minister said that a fuel duty stabiliser was

He has talked about a fuel duty stabiliser; he has promised it; he has answered questions on it-so when is he going to introduce it?

The Prime Minister: I do not believe in making tax changes outside a Budget, which is the proper way we do things in this country. I do think that there is a strong case for looking at this area, because I want to see a situation where, when oil prices rise, we try to help motorists and share the burden with them. The hon. Gentleman quite rightly reminded me of something I said, so perhaps I can remind him of something he said, as he stood on a manifesto that emphasised the need to "reign back public spending" and stated:

I agree with that.

Esther McVey (Wirral West) (Con): I am delighted that the Government's new enterprise allowance will be announced and will begin in my home area of Merseyside on Monday. Is it not initiatives like this that will spark enterprise and start businesses in some of the most deprived parts of the country?

The Prime Minister: My hon. Friend is right. I hope that Labour Members will encourage people to start up businesses and get enterprise going, as it is a private sector-led recovery that this country needs. We should also give special help to areas like hers, which I visited recently, to try to ensure that we do everything to help growth in Merseyside and improve the prospects of the Atlantic gateway-a very exciting prospect for her area and for everyone who lives and works on Merseyside.

Edward Miliband (Doncaster North) (Lab): I join the Prime Minister in sending deepest condolences to the families of those killed in the bombing at Moscow airport. Our thoughts are particularly with the fiancée, family and friends of Gordon Cousland.

Will the Prime Minister explain to the House what, in his view, is the cause of yesterday's disappointing growth figures?

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The Prime Minister: First, they are disappointing growth figures-and they are disappointing even excluding what the Office for National Statistics says about the extreme weather. The point I would make is that this country has a very difficult economic situation for two main reasons. First, we have the biggest budget deficit in Europe, and we have to get to grips with it, which is difficult. Secondly, we had the biggest banking boom and the biggest banking bust anywhere in Europe, and we have to deal with that. As my right hon. Friend the Chancellor, the Governor of the Bank of England and I have all said, it is inevitable that, as we recover from those things, it will be choppy and it will be difficult. The worst thing to do would be to ditch our plans on the basis of one quarter's figures.

Edward Miliband: The Prime Minister has been going around for months saying that our economy is out of the danger zone. Only a month ago, he told the House:

May I ask him to confirm that? He said that if we set aside the bad weather, the figures were not good. In fact, if we set aside the bad weather, growth was completely flat. There was no growth in the last quarter of 2010: no growth at all.

The Prime Minister: That is exactly what the figures show, yes.

The right hon. Gentleman asked about the danger zone. The point that I would make is this. Britain is no longer linked with countries such as Greece, Ireland and Portugal. Everyone was clear about the position before the last election. The Institute of Directors, the Confederation of British Industry and the Governor of the Bank of England all said that there was no credible plan to deal with the deficit.

If you do not deal with your debts, you will never have growth. That is the truth, and the right hon. Gentleman knows it.

Edward Miliband: The Prime Minister does not get it. If you do not have growth, you will never cut the deficit. That is what we saw in the last quarter of 2010.

As millions of families and businesses are worried about their livelihoods and see unemployment rising, inflation rising and growth stalled, what the country wants to know from the Prime Minister is whether he is going to change his strategy in any way in order to get the economy moving.

The Prime Minister: What we need to do in our country is get the deficit down, and at the same time do everything that we can to encourage growth. Let me read to the right hon. Gentleman what the head of the OECD said about the British economy, because I think that it is absolutely vital. He said:

He also said:

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This man, who is entirely independent and in charge of the OECD, is giving us good advice, and I advise the right hon. Gentleman-as he has a new shadow Chancellor and can make a new start-to follow it.

Edward Miliband: The difference is that when we left office the economy was growing. Now the Prime Minister is in office, and it is not.

I have a very specific question to ask the Prime Minister. He has already made clear his decision on VAT, but he still has a choice to make about whether to go ahead with the decision to take another £20 billion out of the economy this year when the recovery is fragile. Is he telling the House and the country that he is determined to go ahead, irrespective of the figures and irrespective of what people up and down the country are feeling?

The Prime Minister: We have now heard what I think we are going to hear a lot more of: the theory that there was a golden inheritance from the Labour party. That is one of the most laughable propositions that I have ever heard put in the House of Commons.

We will not forget that we had the biggest budget deficit in the whole of Europe, and that we were spending £120 million every day just on the interest on that deficit. We inherited a situation in which, because of the regulation carried out by the right hon. Gentleman and the shadow Chancellor when they were in the Treasury, we had the biggest boom and the biggest bust in our banking system. We had a growth model that was based on uncontrollable boom in housing, uncontrollable boom in financial services, uncontrolled public spending, and uncontrolled immigration. We inherited a completely bust system from the two people who worked in the Treasury throughout the last Labour Government.

Edward Miliband: I suppose we can take it from that answer that the Prime Minister is not going to change course. He is not going to do anything to bring about growth in the economy. This is how out of touch he is. What people up and down the country are saying is that he is going too far and too fast with deficit reduction, and that that is what is inhibiting growth in this country.

The evidence shows that while cuts are being made in the public sector and while jobs are being lost in the public sector, jobs are not being created in the private sector. Why does not the Prime Minister, just for once, put his arrogance aside, and admit that he knows how to cut jobs but has absolutely no idea how he is going to create them?

The Prime Minister: The right hon. Gentleman has got to stop writing his questions before he comes to the Chamber and actually listens to the answer. He asks about changing course, and I have to say to him that he seems to have replaced a shadow Chancellor who did not understand Labour's programme with one who does not agree with it. He asks specifically about cuts next year. Let me just remind him that it is Labour's own plan for significant cuts in spending to start in April this year. He shakes his head, but that is his plan, which he is meant to be committed to. If he is now saying that that has all gone and Labour is just going to spend more and borrow more, he ought to tell us. As far as I can hear, his only plan is to borrow money we have
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not got, to spend money on things we cannot afford, and not to do the work we need to do to sort this economy out.

Edward Miliband: I am surprised that the Prime Minister is raising personnel issues this week of all weeks, because who has made the right judgment, me, who appointed the shadow Chancellor, or him, who clung on to Andy Coulson for months?

When people listen to the Prime Minister they will know what the right hon. Member for Haltemprice and Howden (Mr Davis) meant when he said that the Prime Minister and Chancellor

feels. They are out of touch with people's lives, they are taking a reckless gamble, and what these figures show is that for millions of people up and down the country it is hurting but it is not working.

The Prime Minister: If it was such a good decision to have the right hon. Member for Morley and Outwood (Ed Balls) as shadow Chancellor, why did the right hon. Gentleman not appoint him in the first place?

Let me just make the point that the absolute key for this country and our economy is two things: we have to deal with our deficit; and we have to help deliver growth from our private sector. I think that the right hon. Gentleman should listen to what the Governor of the Bank of England said last night in his speech. [Interruption.] Perhaps Labour Members will want to listen to the Governor of the Bank of England, who said:

He said that this was partly as a result of the

He continued:

I prefer the advice of the Governor of the Bank of England to that of the man sitting opposite.

Jacob Rees-Mogg (North East Somerset) (Con): Mr Speaker- [Interruption.]

Mr Speaker: Order. I wish to hear Jacob Rees-Mogg.

Jacob Rees-Mogg: Thank you, Mr Speaker.

Is not the lesson from the noble Baroness Thatcher that, when you have set an economic course, you should stick to it-"there is no alternative"?

Hon. Members: More!

The Prime Minister: My hon. Friend has a huge following in all parts of the House. The point he makes is important: it is that whatever your plans to encourage growth in the economy-we have the lowest corporate tax rate in the G7, we have abolished Labour's jobs tax, and we are investing in science and skills, all of which are necessary-without a plan to deal with the deficit, they are nothing.

Q2. [35932] Ian Mearns (Gateshead) (Lab): I think the Prime Minister would accept that he has had better weeks. He has lost the support of the CBI because he
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does not have a growth strategy; the economy has taken a highly predictable downturn; he has lost his Essex man; and I understand that there were forecasts of snow for the end of the week. Is there anyone remaining in the Government who still understands or is in touch with the concerns of ordinary people, whose jobs are under threat because of his policies?

The Prime Minister: The point I would make is that the CBI says very clearly that it is absolutely essential that we get to grips with the deficit. What it said at the time of Labour's last Budget was that there was not a credible plan; it believes that there now is a credible plan. This is not going to be easy. The Labour party is committed to cuts from April this year. This will not be easy, but it has to be done.

Q3. [35933] Alok Sharma (Reading West) (Con): The Conservative-Liberal Democrat coalition that has been running Reading borough council since last May has uncovered the fact that over the past 12 years the previous Labour administration spent £1.4 million of taxpayers' money funding the salaries of three full-time union officials. Does the Prime Minister agree that that is an inappropriate use of taxpayers' money and that full-time union officials should be paid for by union subscriptions?

The Prime Minister: My hon. Friend makes a very good point. It seems that in local government the Labour politicians pay the unions, whereas in national politics the unions pay for the Labour politicians. It is nice work if you can get it.

Q4. [35934] Mr David Crausby (Bolton North East) (Lab): The Government have switched the indexation of benefits and public sector pensions from the retail prices index to the lower consumer prices index, but when it comes to hiking up petrol, they continue to use the higher retail prices index. In the interests of fairness, how can the Prime Minister justify using the higher indexation for petrol? Should the Government not at the very least use one or the other?

The Prime Minister: I can give the hon. Gentleman one tip. Before writing the question, it is always good to work out one's own party's policy. The Opposition are now committed to increasing benefits by CPI rather than RPI. His party is backing our policy and is far from opposing it.

Q5. [35935] Elizabeth Truss (South West Norfolk) (Con): Recent work by the Nuffield Foundation has shown that Britain has the lowest proportion of 16 to 18-year-olds studying mathematics of any of our competitor countries in the OECD. Just as bad, we have a chronic shortage of maths teachers in our schools. What action are the Government going to take on this issue?

The Prime Minister: My hon. Friend makes a very good point. The Nuffield Foundation has produced an extremely worthwhile report on how badly we are doing with maths teaching and in terms of the number of people studying maths. We will be taking a series of steps to sort this out, which will be announced by my right hon. Friend the Education Secretary. One is to
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expand Teach First, which is an excellent scheme to get graduates from our best universities into schools, and which, for the first time, will include primary schools. Many of them will be maths teachers. We also want to raise the bar for teachers as regards the qualifications they need to teach maths. That is vital in our country and my hon. Friend is right to highlight the issue.

Q6. [35936] Graeme Morrice (Livingston) (Lab): Last Friday, I visited my constituent Vera Gaskin at her Livingston home. Mrs Gaskin has hepatitis C, having contracted it in 1985 through a transfusion of contaminated blood. She had been diagnosed with Hodgkin's disease at the time. Of course, her situation is not dissimilar to that of the several thousands of people who also suffered due to the tainted blood scandal of the 1970s and 1980s. Sadly, many have passed away since. Obviously, I am aware of previous debates in the House on the matter and the statement by the Health Secretary on 10 January, but this does not bring closure to many victims and their families. Will the Prime Minister personally prioritise this matter, work with the devolved Administrations and introduce a proper compensation scheme, thus finally bringing justice to the innocent victims of this terrible tragedy?

The Prime Minister: I thank the hon. Gentleman for that question. He has had constituents come to him about this extremely difficult issue and I have had exactly the same experience in my constituency. Although previous Governments had put arrangements in place, there was a basic unfairness, particularly towards those who caught hepatitis C, because the evidence about what happens to people with AIDS and hepatitis C has changed over the years. I was pleased that my right hon. Friend the Health Secretary made the statement last week that we would increase what was being given to those suffering from hepatitis C. I am not sure that there is ever a level of payment that will bring closure for such an appalling accident, but I believe that the conditions in this country were different from those in other countries that campaigners often compare it to, such as the Republic of Ireland. I think we have the right answer.

Q7. [35937] Mr Don Foster (Bath) (LD): The mobility component of disability living allowance for people in care homes is being reviewed. Whatever improvements are made, will the Prime Minister assure me that disabled people in care homes will still have access to individually tailored mobility support, and that that will be, as the coalition agreement implies, at no extra cost to them or their families?

The Prime Minister: I am grateful for my right hon. Friend's question. The intention here is very clear: we want to ensure that the treatment of people in hospital is the same as the treatment of people in residential care homes in terms of the mobility component of DLA. That was behind the announcement we made, and that is what we want to make sure happens.

Mr Nigel Dodds (Belfast North) (DUP): The Prime Minister may be aware that one of the Members elected to this House has decided to emigrate, and he may want to chalk that up as one of his achievements. The hon.
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Member for Belfast West (Mr Adams) seems to be extremely embarrassed about applying for an office for profit under the Crown although he has shown no such embarrassment in profiting from his office in this House for many years at taxpayers' expense. When will the Prime Minister deliver on his pre-election pledge to hard-pressed taxpayers that he will abolish parliamentary money for parliamentary purposes going to those who do not fulfil their parliamentary duties?

The Prime Minister: First of all, just in case everyone has not caught up with the news, the right hon. Gentleman is quite right that the hon. Member for Belfast West has accepted an office of profit under the Crown, which is of course the only way to retire from this House. I am not sure that Gerry Adams will be delighted to be a Baron of the Manor of Northstead, but none the less, I am pleased that tradition has been maintained. On the very serious point that the right hon. Gentleman makes about allowances, in my view we should be aiming for all Members who are elected to take their seats in this House. That is what should happen and if some Members have a problem with what that entails, they ought to look at a remedy for that and should come and talk about it. That is the most important thing we could achieve.

Q8. [35938] Karen Lumley (Redditch) (Con): Will the Prime Minister join me in congratulating Vaynor first school in Redditch, where I am chairman of the governors, on having recently received a good Ofsted report despite the continual lack of fairer funding from the Labour party? Will he also welcome the extra funding that will be heading to Worcestershire schools, due to the pupil premium, totalling more than £3 million?

The Prime Minister: My hon. Friend makes a very good point, and I hope that everyone in the House will be able to welcome the fact, first, that the amount of spending per pupil will continue, even though we have a very tough and difficult situation in our country. Over and above that, there will be a pupil premium payment-something that the Labour party did not do in 13 years of being in power. This money will go to those from deprived backgrounds in schools all over our country, and not just in inner-city areas; as she says, her constituency will benefit. I think the whole House should celebrate that.

Mr Tom Watson (West Bromwich East) (Lab): The former investigating officer is now on the payroll of News International and three senior editors have been identified in relation to phone hacking-is it not time that another police force took over the inquiry? You have the status to make it happen, Prime Minister. What are you afraid of?

The Prime Minister: Let me be absolutely clear: phone hacking is wrong and illegal, and it is quite right that the Director of Public Prosecutions is reviewing all the evidence, which should be followed wherever it leads. I do not think it is necessarily fair to say the police have not been active-after all, there have been prosecutions, convictions, and indeed imprisonments-but the law is quite clear and the prosecuting authorities should follow it wherever it leads.

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Q9. [35939] Mr James Clappison (Hertsmere) (Con): Tomorrow is Holocaust memorial day-the anniversary of the day on which Auschwitz was liberated. Will my right hon. Friend join me in paying tribute to the Holocaust Education Trust and its work to ensure that the lessons of the holocaust are not forgotten?

The Prime Minister: I know that my hon. Friend speaks for the whole House when he raises the brilliant work that the Holocaust Education Trust does. I think this is a good time to pay tribute to the, sadly very few, holocaust survivors left. I had the huge privilege of meeting one, Trude Levi, yesterday in No. 10 Downing street. To hear the story of what those people went through, what they escaped, and in many cases what they had to go through even after they escaped, is truly humbling. We must never forget-not just because of what happened in Europe in the holocaust, but because too often there is genocide in our world today; we need to be permanently reminded of that fact.

Q10. [35940] Mr Ian Davidson (Glasgow South West) (Lab/Co-op): The Prime Minister, the Chancellor and the majority of the Cabinet grew up in secure worlds of economic wealth and privilege. Does the Prime Minister agree that today's young people face economic uncertainty and high youth unemployment? Is youth unemployment a price worth paying?

The Prime Minister: It never is-but youth unemployment has been a structural problem in our country for years. Under the previous Government, when the economy grew for many years, youth unemployment was worse at the end of that growth than it was at the beginning. Then, of course, it rocketed during the recession. We need a serious examination of how we can reduce the number of people who are not in education, not in employment and not in training. Rather than trading slogans across the House, it would be better to work out why the number has gone up in good times and in bad.

Q11. [35941] Kris Hopkins (Keighley) (Con): Unlike the NHS or my local council, Manorlands, a Sue Ryder hospice in my constituency, is not able to reclaim the VAT that it has paid. May I ask the Prime Minister to examine the issue and try to create a level playing field for health care charities?

The Prime Minister: I know this is an issue that many hon. Members care about deeply. We should all pay tribute to the hospice movement and what it does, working with our health service. It is important that we do everything we can to cut red tape and allow charities to thrive. Charities can and do reclaim some of their VAT, but in considering a bigger exemption such as my hon. Friend speaks about, we have to look at the consequences both for the state sector and the private sector, and their relationship with the voluntary sector, before we can take such a step.

Keith Vaz (Leicester East) (Lab): Will the Prime Minister join me in welcoming the visit of the Prime Minister of Bangladesh to the United Kingdom and to Parliament? Apparently, a few years ago, when she came to Prime Minister's questions, she was so impressed that she decided to institute it in Bangladesh. I am not
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sure whether she has changed her mind since. Can he give the House an assurance that he will continue to build on the strong bilateral links between Britain and Bangladesh?

The Prime Minister: I thank the right hon. Gentleman for his question. The Prime Minister is very welcome to Britain and also welcome to be watching our deliberations today. As the right hon. Gentleman says, whether she will go away feeling proud and excited by what the mother of Parliaments does on Wednesday at 12 o'clock is another question. She has already had a very good meeting with my right hon. Friend the Deputy Prime Minister. Relations between Britain and Bangladesh are good, and we need to expand them still further.

Q12. [35942] Nigel Adams (Selby and Ainsty) (Con): My constituents, Ben Oldroyd and Matthew Carr, are autistic and have Asperger's syndrome. They have asked for my help because they want to visit schools in the Selby district to speak to pupils and staff and give them their experience of living with autism and the challenges that they face with that condition. They have already received praise from the head of Brayton high school. Does my right hon. Friend agree that such an initiative could be extremely good news for schools and the teaching profession?

The Prime Minister: I thank my hon. Friend for his question, which raises an important point. We made good steps during the last Parliament, with the Autism Bill promoted by the now Secretary of State for Wales, my right hon. Friend the Member for Chesham and Amersham (Mrs Gillan), but there is a huge amount that can be done by people themselves to get a greater understanding of autism and Asperger's, not least because there is such a huge spectrum and such a big difference between the children suffering from those conditions. I am sure the work to which my hon. Friend refers is extremely worthwhile.

Dr Stella Creasy (Walthamstow) (Lab/Co-op): Last week the Prime Minister said something that I agree with: he said that we needed to do something about loan-sharking, so will he join me next week in supporting the motion to cut the cost of credit and support the poorest consumers in Britain with protection from those companies?

The Prime Minister: At the risk of building on what is clearly a blossoming friendship already, I will look carefully at what the hon. Lady says. On the issue of controlling loan sharks, one part should be encouraging credit unions. There is all-party support for that. Sometimes we have to be careful as we regulate that we do not drive out responsible operators and bring in loan sharks, so we must get the balance right. I will look carefully at what the hon. Lady is saying and perhaps get back to her.

Q13. [35943] Jesse Norman (Hereford and South Herefordshire) (Con): Last week the Public Accounts Committee found that the previous Labour Government had pushed through private finance initiative deals without offering any alternative, and often regardless of expense or value for money. The result has cost the taxpayer
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billions of pounds too much. Does the Prime Minister share my view that there should now be a full investigation of why and how that happened?

The Prime Minister: I thank my hon. Friend for his question. The Public Accounts Committee can do a lot of that work by unveiling some of the appalling decisions that were made, which were just about off-balance-sheet accounting, rather than good value for money. I see the shadow Chancellor nodding, but he was in the Treasury when all that happened. As in so many cases, what we will find is that the mistakes that we now have to pay for are the responsibility of Gordon Brown's two henchmen sitting on the Opposition Front Bench.

Q14. [35944] Alun Michael (Cardiff South and Penarth) (Lab/Co-op): The Prime Minister used to talk rather a lot about fairness, but he has not done so well on performance, so here is a test for him. The banks have walked away from the talks on bankers' bonuses. What will he do about it?

The Prime Minister: The talks are ongoing, and I will tell the right hon. Gentleman what I want. I want the banks to pay more in tax, and they will pay more in tax, up from £18 billion last year to £20 billion next year. He says they have walked away; they have not. These talks are ongoing, and I want to see the taxes go up, the bonuses come down, but vitally, the lending increase. I am confident that we will achieve all those three goals.

Paul Maynard (Blackpool North and Cleveleys) (Con): I know that the Prime Minister regards Blackpool as a special place, as indeed he should. Does he agree that it is about time that Blackpool's unique status as the first working-class seaside resort should be recognised with UNESCO world heritage status?

The Prime Minister: My hon. Friend makes a powerful case for his constituency. I have a warm feeling whenever I think of Blackpool, because of the many conferences that I have attended there and the time that I have spent there. I understand, as I know he does, the pressures that it faces because of changing patterns of tourism and development, and the Government are committed to helping Blackpool to map out a strong future. It is also wonderful to see Blackpool where they belong in the premier league.

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Q15. [35945] Sheila Gilmore (Edinburgh East) (Lab): With the economy shrinking by 5% and inflation rising, having followed Ireland on the path of cutting too fast and too deep, are we not now in danger of following Ireland further down that slippery slope?

The Prime Minister: I am sorry to tell the hon. Lady that the 5% reduction was under her Government, not this Government. If the former shadow Chancellor's primer has gone missing, perhaps she could get hold of a copy. When we came to office in May, the idea that there was some acceptable plan to reduce the deficit is a complete fiction. Let me just give her this one figure. If we went ahead with the plan of halving the deficit in four years, in four years' time our deficit would be bigger than Portugal's is now. Does anybody think that that is a credible path back to growth and confidence? It is not.

Richard Graham (Gloucester) (Con): One of the most important strands in the Government's growth strategy has been the creation of 75,000 additional apprenticeships. Does the Prime Minister agree that the forthcoming national apprenticeship week and the Gloucestershire apprenticeship fair represent a great opportunity to get young constituents to earn while they learn, especially in the manufacturing sectors, which are growing faster now than at any time under the previous Government?

The Prime Minister: My hon. Friend makes an excellent point. In the spending review, we had to take difficult decisions, particularly on welfare and pay, but as a result we are able to expand the number of apprenticeships to a record level, an extra 75,000. Yes, the growth figures are disappointing, but manufacturing and exports are up, and we are starting to rebalance the economy away from the unsustainable booms that we had under the Labour Government.

Mr Speaker: Order. Before the right hon. Member for Rotherham (Mr MacShane) asks his urgent question, I appeal to hon. and right hon. Members who are leaving the Chamber to do so quickly and quietly, so that those who are interested in the next business can attend properly to it. A quiet and speedy exit is required.

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BBC World Service

12.33 pm

Mr Denis MacShane (Rotherham) (Lab) (Urgent Question): To ask the Foreign Secretary if he will make a statement on BBC World Service cuts.

The Secretary of State for Foreign and Commonwealth Affairs (Mr William Hague): The House will agree that the BBC World Service performs an invaluable role, reflecting British democratic values overseas and supporting British influence in the world, and that the services it provides are a beacon to many in some of the poorest and most insecure countries in the world. We announced in October that from 2014 responsibility for the BBC World Service will be transferred to the BBC itself and funded from the licence fee, a move that has been welcomed by the World Service and the BBC Trust as providing new opportunities for the World Service to develop in the future. In the meantime, the World Service, like any other taxpayer-funded body, must ensure that it is working on the right priorities and as efficiently as possible. I announced in October that its expenditure limits would be reduced by 16% in real terms over the next three years.

As I set out in a written statement earlier today, we are providing £13 million per annum to help with the deficit in BBC pension funds and £10 million per annum for new services in markets that we and the World Service have identified as priorities. Those include TV programming in Urdu, in sub-Saharan Africa and in Hindi to be provided to local partners. We have also guaranteed the capital for the move of the World Service to its new offices in W1. That is proper provision for the future of the World Service and will make up for inherited deficits.

The other services provided by the World Service cannot stand still, and those that have become less well used because of the rise of local broadcasters or falling shortwave audiences sometimes have to close. It is the World Service's responsibility to be as efficient as possible while maintaining as many services as possible, something the previous Government recognised when in 2006 they closed 10 separate language services of the World Service. The World Service initially suggested to the Foreign Office the closure of up to 13 language services, but I refused to give permission for that. I have agreed to the closure of five language services, accounting for 3.5 million listeners out of the total audience of 180 million. Withdrawal from shortwave and other services will have a bigger effect, but they will rightly allow for concentration on online and mobile services for the future.

The BBC World Service has a viable and promising future, but it is not immune from public spending constraints or the reassessment of its priorities. While any closures might be regretted, they would not be necessary at all were it not for the inherited BBC pension deficit and the vast public deficit inherited from the previous Government.

Mr MacShane: May I remind the right hon. Gentleman that he is Her Majesty's principal Secretary of State for Foreign Affairs, not a pensions actuary at KPMG? In every year of the previous Labour Government, the grant in aid to the foreign service went up, but under
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him it has gone down. He is doing in part what no dictator has ever achieved: silencing the voice of the BBC, the voice of Britain, the voice of democracy, and the voice of balanced journalism at a time when it is needed more than ever.

I have an interest to declare. It was the World Service that broadcast my arrest and imprisonment 30 years ago in communist Poland, thus helping to secure my fairly swift release. This week there is turmoil in the Balkans, where people were killed and injured in Tirana last Friday and where Serbia and Macedonia remain without a European future. There is turmoil in Russia, where no one trusts the Putin-controlled media. There is turmoil in Africa, from Egypt and Tunisia down to Ivory Coast and Zimbabwe. What are the Government doing? They are axing the voice of the BBC-the voice of Britain and our values-in Albanian, Serbian and Macedonian. They are cutting services to Angola, Mozambique, Russia and China. They are taking the BBC off the air as other non or semi-democracies replace BBC truth with their propaganda.

The Foreign Secretary secured a flat cash settlement for his own Foreign and Commonwealth Office diplomats, but he has made the World Service the main victim of his cuts with a 20% real-terms reduction. That will cost the jobs of hundreds of journalists who come from every corner of the world to offer their linguistic and political expertise to our nation.

Finally, does the Foreign Secretary accept that just 0.5% of the UK's total spend on international work goes to the World Service? I urge him to look across the range of UK overseas spending, including some sacred cows, and reverse the World Service cuts before irreparable damage is done to our country. If he cannot do that, he should let us have a Foreign Secretary who will allow Britain to maintain its voice in the world.

Mr Hague: When the right hon. Gentleman talks about Poland, one would never imagine that the World Service's Polish service was closed by the Government of whom he was a member. When he talks about the Balkans, one would never imagine that the Bulgarian, Croatian and Slovene services were also closed by the Government of whom he was a member. It was apparently fine under the previous Government sometimes to have to change priorities, but it is not fine now.

The right hon. Gentleman asks about the Russian services. In Russia, online audiences have increased by 120% in the past 12 months, while radio audiences have declined by 85% since 2001. That is why it is absolutely right for the World Service to move more of its services to online and mobile services; that is the way the world is going, even though he might not have noticed it.

Of course the World Service has to move with the future, and of course occasionally some services have to close. The right hon. Gentleman recognised that when he was a Minister. It is a pity he does not recognise it now.

Richard Ottaway (Croydon South) (Con): The World Service together with the British Council are hugely valued services and probably the most effective way of advancing Britain's perceptions of the world. What we have here is an inevitable consequence of restoring stability to the economy. As my right hon. Friend says, funding for the World Service will transfer to the BBC
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from 2014. Will he confirm that, with the savings that the transfer will make and the move to Broadcasting house that is going on at the moment, it is open to the BBC to increase funding after 2014?

Mr Hague: My hon. Friend is absolutely right. Indeed, there is some degree of excitement in the BBC Trust about that-about the potential in being able to bring together more easily the resources of the BBC and the experience of the BBC World Service. For instance, it might be able to develop BBC World television more successfully, so there is a positive side to look forward to, and that is what the House should concentrate on.

Mr Douglas Alexander (Paisley and Renfrewshire South) (Lab): I should be interested if the Foreign Secretary could, for the sake of the House, adduce the evidence whereby the BBC Trust is excited at the prospect of the cuts that have been announced today. The director-general of the BBC has made it clear that the cuts are a direct consequence of last autumn's spending review. Of course, the Foreign and Commonwealth Office should not be exempt from the need to reduce the deficit, but in making cuts in the FCO, especially to a relatively small budget that has a global impact, there is surely a need for particular care and concern.

Will the right hon. Gentleman explain what proportion of the cuts to the FCO under the spending review settlement will be absorbed by the core FCO budget as distinct from the World Service and, indeed, the British Council? Will he set out his explanation of why the BBC World Service will absorb 16% to 20% real-terms cuts as against 10% real-terms cuts for the FCO? Will he explain how his often-stated ambition to strengthen bilateral relations with the BRIC countries-Brazil, Russia, India and China-is advanced by the end of radio programming in Mandarin Chinese? The reach and respect of the BBC World Service is a huge asset for Britain, and the Government should not put that at risk.

Mr Hague: May I first of all welcome the right hon. Gentleman to the Dispatch Box? I look forward to working with him and to many exchanges with him, although we will always remember that he was Minister for Europe when £7 billion of our rebate was given away, which would of course have paid for the World Service 30 times over. We may have to remind him of that on future occasions as well.

I did not say that the BBC was excited about the reductions in the budget, but, considering the meeting that I had with the corporation about the issue in October, I can say that it is certainly excited about the potential in bringing together the work of the BBC and the World Service, so my evidence is the meeting that I had with Sir Michael Lyons and his colleagues.

It is true that in this spending round the real-terms cut in the Foreign Office budget is 10% and in the World Service budget 16%, but it is true also that in the previous three years the cut in the core Foreign Office budget was much greater. On the effect of all that, by 2013-14 the proportion of the Foreign Office budget accounted for by the World Service will be pretty much exactly the same as it was when the right hon. Gentleman was a Minister in the Foreign Office, five years ago. We ask the World Service only to bear its fair share of the public expenditure reductions, which are obviously necessary
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in this country. That is the right and fair thing to do, and now we have to work with the World Service and support it in making the best possible job of that.

The Chinese service reaches a very small number of people compared with the size of the Chinese population, and it needs refocusing. The new, enriched online service will aim to reach not only people in China, but 67 million Chinese people who live outside China, and it is designed to be more appealing to younger audiences. Again, there is a rationale for many of the changes that the World Service proposes, albeit within financial constraints.

Robert Halfon (Harlow) (Con): Given the huge influence of Islamist television channels such as Hezbollah and al-Jazeera, will my right hon. Friend confirm that resources will continue to be spent on BBC World Service TV and radio services in the middle east, and on the Arabic service?

Mr Hague: Absolutely. That is, of course, a major area of the World Service's broadcasting. None of the language service closures that are envisaged or agreed to will affect the middle east. Those closures are of services in Albanian, Macedonian, Serbian, Portuguese for Africa and English for the Caribbean. The work of the BBC World Service in the middle east will continue at its current strength.

Mr Ben Bradshaw (Exeter) (Lab): These cuts are a direct result of the Foreign Secretary's decision to allow the funding of the World Service to pass from his Department to the licence fee payer. Many of us warned that that would happen at the time. The countries where language services have been closed that he listed in response to my right hon. Friend the Member for Rotherham (Mr MacShane) were all European democracies within the European Union; that is not the case with the language services the Foreign Secretary is closing. Why should the BBC spend any more money on language services that the licence fee payer has no interest in and, in many cases, cannot listen to?

Mr Hague: In case there is any confusion, there is no connection between these reductions and the transfer of the BBC World Service to licence fee funding, which will take place in four years' time. For the next three years, the BBC World Service will continue to be funded directly out of public expenditure. Just to make it clear for the right hon. Gentleman, the reductions are therefore not the direct consequence of that decision. The services that closed under the previous Government were not just European democracies in the European Union; they also closed the Kazakh and Thai services. The closures were much more widespread. As I said, the previous Government recognised that closures sometimes had to take place. Labour Members must recognise that unless they oppose all reductions in Government expenditure, sometimes these things have to happen.

Mr Don Foster (Bath) (LD): Cuts in the jewel in the crown of this country are clearly disappointing. Does the Foreign Secretary accept that the World Service makes a huge contribution to our international development agenda? Is he willing at least to discuss with the Secretary of State for International Development whether his Department, which currently makes no contribution, could make a small contribution? For example, £3 million a year would save the Russian and Mandarin Chinese services.

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Mr Hague: I point out to my right hon. Friend that there are merits in the changes to the Russian and Chinese services, for the reasons that I have given about changing patterns of usage. It is not clear that if the BBC World Service had a few million pounds extra, keeping those services exactly as they are would be the best use of that money. However, that would be for the World Service to decide. I am looking at whether additional funding can be provided in this financial year to help with the restructuring costs. It is not impossible that we will find some additional money for the World Service. A good part of the public money that is spent on the World Service is ODA-able-official development assistance-expenditure, so it falls within that category. I think that my colleagues in the Department for International Development and all other Departments would agree with my assessment that public spending discipline has to apply to all parts of the public sector, including the BBC World Service.

Sir Gerald Kaufman (Manchester, Gorton) (Lab): Is it not a fact that the BBC World Service is the most trusted voice in the world-more trusted than any Government, and more trusted than any other broadcaster in English or any other language? Therefore, to undermine the BBC World Service is to undermine truth. Is it not essential for the right hon. Gentleman to accept that it is about time that this Government dedicated themselves to truth and trust, and not to spin?

Mr Hague: These are the straightforward facts of the matter. The fact that the previous Government closed 10 services in 2006 is nothing to do with spin; it is the sheer truth of the matter. One point I would make to the right hon. Gentleman is that one of the advantages-although not a decisive advantage on its own-of transferring the BBC World Service into the BBC is that it will no longer be possible to make the argument, which is sometimes made around the world, that the BBC World Service is an arm of the British Government and is funded directly from the Foreign Office, and that therefore some suspicion should be cast on it. By showing the world that the BBC World Service, which is known for its impartiality and independence, will be part of the BBC, rather than funded by the Foreign Office, we are underlining, rather than undermining, its independence.

Nicholas Soames (Mid Sussex) (Con): Given the inevitable reordering of the finances of the World Service, does the Foreign Secretary agree that it is none the less essential, in a world in which the media move at an extraordinarily fast pace and the world itself is changing so rapidly, that it has the capacity to change if it needs to do so, and that its capabilities should not be set in stone?

Mr Hague: Yes, my hon. Friend is absolutely right. That was why I emphasised the changing nature of the demand for World Service broadcasting and the rapidly increasing online demand, particularly for its Russian services. Such things do not stand still, which of course means that the skills and personnel required sometimes change. There should be wider recognition of that.

Mike Gapes (Ilford South) (Lab/Co-op): The Foreign Secretary has referred several times to what happened under the previous Government. Will he confirm that
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the World Service established television in Arabic and Persian and new online services, and that the previous Government did not preside over a cut of 650 staff or make it face 16% cuts, which it now faces when the Foreign Office is suffering only 10% cuts? Is that not a direct consequence of his agreement to the budget cuts and his choices?

Mr Hague: The previous Government doubled the national debt in four years and ran up a budget deficit of 11% of our gross domestic product. That is why we are now in a period of public spending restraint, whether in the World Service or any other area.

Malcolm Bruce (Gordon) (LD): In response to my right hon. Friend the Member for Bath (Mr Foster), the Foreign Secretary acknowledged that World Service funding was ODA-able in some cases. Does he envisage having discussions with DFID, given the increased commitment to operating in fragile and post-conflict states and the consequences of withdrawing the Portuguese for Africa, Nepali, Swahili and great lakes services? There could be scope for an agreement between the two Departments to reinstate or maintain those services.

Mr Hague: As I said, a good deal of the expenditure is already ODA-able. I do not know what scope that leaves for additional ODA-able funding, but DFID is already in the process of setting its own priorities, which do not normally include supporting the operations of the BBC World Service. Overall, these changes are necessary. I said that I am considering whether additional money can be provided to help the World Service through the restructuring-I am talking about only up to a few million pounds, but it may be of assistance. I cannot promise a large part of the DFID budget for this cause.

Ms Gisela Stuart (Birmingham, Edgbaston) (Lab): I used to be accused of having a typical foreigner's emotional attachment to the World Service, and I plead guilty to that. The Foreign Secretary has a sense of history and knows that the World Service's reputation is based on not just its independence but its exceptional quality. The latest round of more than 600 redundancies will cut into its core and undermine it, because it will not have enough journalists. As a historian, he cannot be proud to be the Foreign Secretary who will oversee the final death of the World Service.

Mr Hague: None of us who are conscious of history can preside over a Government heading towards the bankruptcy of this country, and that is why we have to have spending restraint across the public sector. I stress that, as I said in my initial answer to the right hon. Member for Rotherham (Mr MacShane), there is a viable and strong future for the BBC World Service. The right place for it is with the BBC itself, which has taken it on with enthusiasm. It is wrong to pretend that there should never be any changes or reductions, and of course we have to ensure that we live within our means in this country. These changes are part of doing that.

Geoffrey Clifton-Brown (The Cotswolds) (Con): Does my right hon. Friend accept that the BBC World Service, along with the British Council, has a huge world reputation in exchanging views and knowledge from the western
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world? Does he accept also that it is not just the number of people who receive a service that counts? It is precisely the minorities in difficult parts of the world who need truth and independent advice.

Mr Hague: My hon. Friend is absolutely right, and that was one reason why I was anxious to avoid a larger scale of language service closures than those to which I have agreed. We have limited them to five language services, along with other changes to the BBC World Service, partly because of the reason he gives.

Ian Murray (Edinburgh South) (Lab): Will the Foreign Secretary join me in paying tribute to all the staff of the BBC World Service working both in this country and abroad? Is he giving any consideration to helping the BBC with the redundancies that will occur as a result of his decision, many of them affecting people in specialist positions?

Mr Hague: I have paid tribute on many occasions to the staff involved and to the BBC for the service that it provides around the world, and I do so again. I said that we might be able to find some additional help with the restructuring costs, and I mentioned in my initial answer the money that we have included in the settlement to underwrite the World Service's move to new headquarters and to ensure that some new services can be developed. There is a strong commitment to the future of the World Service.

Damian Collins (Folkestone and Hythe) (Con): In his correspondence with Sir Michael Lyons, which has been placed in the Library today, the Foreign Secretary states that he will

What conversations has he had with the BBC Trust about that, and can he confirm whether he has met Sir Michael Lyons in person during his negotiations?

Mr Hague: Yes, I have met Sir Michael in person a couple of times. On the subject of what discussions are taking place, I am awaiting further details from the World Service of how it would use any additional money this year to help make the savings and rationalisations that we have discussed.

Meg Munn (Sheffield, Heeley) (Lab/Co-op): The BBC World Service provides a vital link to the outside world for oppressed countries and isolated countries such as Burma. The Foreign Secretary will remember the important role that the Burmese service played during the demonstrations back in 2007. Will he assure the House that those considerations will be taken into account in the future, to ensure that we do not pull such important services away from those countries?

Mr Hague: Yes, the hon. Lady is absolutely right, and I certainly would not agree to the closure of services for Burma, even if it were proposed. The considerations that she underlines, such as the help that the World Service provides to people in oppressed countries, must always be important in the decisions that we make about its services.

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Mr Andrew Tyrie (Chichester) (Con): There is very deep concern in the House about this decision, and I hope that the Foreign Secretary will reconsider it with Cabinet colleagues. In particular, I hope that he will take a look at the overseas aid budget, which is increasing by 37% in real terms at a time when he intends to implement 16% cuts to the World Service. I hope that he will hear the message from the House that if there is a choice between the two, we want to put the World Service first.

Mr Hague: I stress to my hon. Friend that a good deal of the World Service's budget already counts as ODA-able expenditure, so he should not think that turning to DFID for the money is an easy answer. I reiterate my view that all parts of the public sector must join in in becoming more efficient, and the BBC World Service will be part of the public sector for the next three years.

Mr Gregory Campbell (East Londonderry) (DUP): Given the scale of the Foreign Secretary's announcement, what guarantee can he give that the BBC's non-partisanship and impartiality in reporting, which has always been a hallmark of its broadcasting capabilities, will be maintained in future?

Mr Hague: I do not anticipate that anything that we are announcing today will have any impact on that important part of the character of the BBC. As other hon. Members have underlined, that is part of the reason for the respect for the World Service, and it is committed to continuing that character.

Nadhim Zahawi (Stratford-on-Avon) (Con): The BBC Monitoring service is recognised globally as being of the highest quality, and it is essential to a number of our allies. Given the inevitable cost savings that have to be found, can the Foreign Secretary confirm that he is not looking to cut back the monitoring service?

Mr Hague: The monitoring service is not part of today's announcement, but it will of course have to make savings, because it, too, is funded from Government expenditure. Further details of that will follow.

Mr Barry Sheerman (Huddersfield) (Lab/Co-op): The Foreign Secretary will know that there used to be a consensus throughout the House for supporting the BBC World Service-we saw off the Thatcher Government together when they attacked it. Should he not hang his head in shame today? These are cuts of a scale beyond anything that went on under previous Governments, to a service that is cherished by the British people, who will punish him. They are part of his overall plan to please Rupert Murdoch and denigrate the BBC.

Mr Hague: There is a sort of ridiculous air to that question, if I may say so. Clearly, my announcement was nothing to do with the last matter to which the hon. Gentleman referred. It is necessary to make savings in Government expenditure because of the performance of the Government whom he supported.

Dr Julian Huppert (Cambridge) (LD): What analysis has the Foreign Secretary made of the benefits to Britain's foreign, development and even domestic policy objectives of spending on the World Service versus spending on Trident?

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Mr Hague: Both are absolutely essential for the future security of this country.

Mr Frank Roy (Motherwell and Wishaw) (Lab): This is a black day for more than 650 people who will lose their jobs. Among those will be foreign journalists who came to this country on work visas at great risk to themselves. What will the Secretary of State do to ensure that those people are not sent back to danger in their original countries?

Mr Hague: There should be no question of that happening. We have well established procedures, over which the Home Secretary presides, to ensure that people do not go back to danger in their home countries. That is a separate issue, but if it comes up at all, and if there is any danger of those things happening, Ministers will want to make sure that they do not.

Mr John Baron (Basildon and Billericay) (Con): To follow up on that point, the BBC is very concerned about the plight of the foreign-born journalists who work in this country who will now be made unemployed. Can the Foreign Secretary promise to work with the BBC and look sympathetically on those journalists who might have to return to countries on which they have reported critically?

Mr Hague: Yes, absolutely. To reiterate the answer I just gave to the hon. Member for Motherwell and Wishaw (Mr Roy), we will look very sympathetically on that situation.

Fiona Mactaggart (Slough) (Lab): At the moment, the audience for the BBC World Service is more than 240 million people around the world. After these cuts, will the BBC still be the pre-eminent world broadcaster, putting forward our democratic values in a way that other international broadcasters fail to do?

Mr Hague: Yes. Not only will the BBC be that, but it will have great potential for the future in working with other BBC services and in developing some of the new services that I have outlined today.

Paul Maynard (Blackpool North and Cleveleys) (Con): The Foreign Secretary has often spoken of the importance of soft power in diplomacy, particularly with reference to the BBC World Service. Although I regret the loss of services in the western Balkans, can he explain how we can better deploy our soft power resources in that very vulnerable region to try to secure its peace in future?

Mr Hague: My hon. Friend's question raises a wider discussion about the western Balkans. We give a great deal of diplomatic and ministerial attention to that region. We have been highly active in ensuring that dialogue rather than confrontation has taken place between Serbia and Kosovo over recent months, and we are now doing a great deal of work on the future of Bosnia. That is done by British diplomats, supported by the work of British non-governmental organisations, and British Ministers, working cohesively.

Chris Bryant (Rhondda) (Lab): I am absolutely certain that the World Service cannot be preserved in aspic, and that if Labour had been in power, there would have been cuts in its budget. However, every single foreign
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politician whom I have met in my time in this House told me that one of Britain's greatest assets is the BBC World Service. For many of them, it was the symbol of freedom. My big anxiety is that cuts in the World Service are so much heavier than cuts in other parts of the Foreign Office that they will leave a very depleted organisation, and that uniting the World Service with the rest of the BBC will hit rather than improve its impartiality. Will the Foreign Secretary therefore reconsider?

Mr Hague: The hon. Gentleman's question is a good deal more realistic than some that I have been asked in the past half an hour, because he recognises that whatever Government were in power, there would have to be reductions in the World Service. He can gather from what I outlined earlier that we have sought to limit the impact on the number of countries involved. That is why only five separate language services are being closed. We have taken all the factors he outlined into consideration, limited those closures and provided for the future development of the World Service, so that it continues to be the respected service of which he rightly speaks.

Alun Michael (Cardiff South and Penarth) (Lab/Co-op): The Foreign Secretary seems not to understand that his decisions will topple the BBC from its position as the No. 1 in the world, or that the loss of critical mass is significant. Surely he will accept that we cannot simply restart a service in a particular country or part of the world when problems emerge, yet the World Service is so important in such countries, and to their diaspora in this country, at such times, as I have seen in respect of Somalis in the UK. Will he reconsider the damage that he is doing with those decisions?

Mr Hague: I pointed out how the growth of some services is taking place-I mentioned earlier how the use of the online service in Russia has grown by 121% in the last 12 months. As the hon. Member for Rhondda (Chris Bryant) was saying a moment ago, the services of the BBC World Service cannot be preserved in aspic-they must change-and Opposition Members must understand that.

Barry Gardiner (Brent North) (Lab): Given that two of the greatest strengths of the World Service were to speak truth to the powerful and to broadcast hope to the poor and downtrodden, does the Foreign Secretary not see even the slightest irony in the fact that in the week when he introduces swingeing cuts to the World Service, the Secretary of State for Culture, Olympics, Media and Sport, who is sitting next to him, has given a second chance to Rupert Murdoch?

Mr Hague: They are two entirely unrelated issues. Does the hon. Gentleman not see the slightest irony in the fact that having left this country on the brink of bankruptcy, Opposition Members now complain that we are doing something about it?

Jim Shannon (Strangford) (DUP): Everyone in the House recognises very clearly the uniqueness and importance of the BBC World Service. The Foreign Secretary mentioned in his presentation today that one reason for the cuts is that the numbers of those who listen to radio are down, but what consideration has he given to countries where the only media method is
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radio? Has consideration been given to what the uniquely British World Service gives to the democratic process in countries such as China, and will he ensure that people in such countries have an opportunity to continue to listen?

Mr Hague: Yes, of course the Government considered that, as did the BBC World Service in drawing up the list of what it thinks it is necessary to do. The predominant availability of the service only on radio is one of the factors that the BBC has borne in mind. Burma, which was mentioned earlier, is a case in point. That has been one of the factors in drawing up the list. Of course, in those areas where the service is to close, countries are generally provided with a vast range of different media outlets, including a much more thriving local media than was the case only a decade ago.

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Counter-terrorism Review

1.7 pm

The Secretary of State for the Home Department (Mrs Theresa May): With permission, Mr Speaker, I should like to make a statement on the outcome of the review of counter-terrorism and security powers.

The review has taken place in the context of a threat from terrorism that is as serious as we have faced at any time. In dealing with that threat, it has been the consistent aim of this Government to protect not only the security of our citizens, but the freedoms of us all.

We reviewed counter-terrorism legislation because too much of it was excessive and unnecessary. At times, it gave the impression of criminalising entire communities. Some measures, such as the extraordinary attempt to increase the period of pre-charge detention for terrorist suspects to 90 days, were rightly defeated in Parliament. Others, such as the most draconian aspects of control orders, were defeated in the courts. Those measures undermined public confidence, so I am delighted that the Leader of the Opposition has made it clear that he will support me in preventing the excessive use of state power.

I make no apology for the time that this review has taken. It has rightly been deliberate and thorough to ensure that we safeguard both our security and our freedoms. The review has taken account of all sides of the argument. It has received evidence from academic experts and civil society groups, from communities across the country, and from the law enforcement and security agencies. I have, of course, consulted regularly with my right hon. Friend the Secretary of State for Northern Ireland, and my noble Friend Lord Macdonald of River Glaven has provided independent oversight of the process. He has had access to all relevant papers and has played an invaluable role in ensuring that all the evidence was given proper consideration. I thank him for his contribution in ensuring that the recommendations of this review are not only fair but seen to be fair. I am laying the review, a summary of the public consultation, and Lord Macdonald's report, in the House.

On pre-charge detention, the Government announced to the House last week that we would not renew the current legislation on extended pre-charge detention. This means that the sunset clause inserted by the last Government has now brought the maximum period of pre-charge detention down to 14 days. The review sets out the detailed considerations leading to this conclusion.

The police, prosecutors and the Government are clear that the normal maximum period of pre-charge detention should be 14 days. However, we recognise that in exceptional circumstances only this might need to be temporarily increased to 28 days. We will therefore draw up draft primary legislation to be introduced for parliamentary consideration only in such circumstances. We will publish a draft Bill and propose that this be subject to pre-legislative scrutiny. I should make it clear to the House that until it is repealed by the freedom Bill, section 25 of the Terrorism Act 2006 will remain on the statute book allowing the Government to increase the maximum period to 28 days in an emergency, subject to Parliament's agreement. There has therefore been no gap in our ability to seek Parliament's consent to increase the period of pre-charge detention should the need arise.

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On the use of section 44 stop-and-search powers, I have concluded that the current provisions, which were found unlawful by the European Court of Human Rights, represented an unacceptable intrusion on an individual's human rights and must be repealed. But the evidence, particularly in Northern Ireland, has demonstrated that where there is a credible threat of an imminent terrorist attack, the absence of such powers might create a gap in the ability of the police to protect the public.

We therefore propose to repeal section 44 and to replace it with a tightly defined power that would allow a senior police officer to make an authorisation of much more limited scope and duration for no-suspicion stop-and-search powers to prevent a terrorist attack where there is a specific threat. This targeted measure will also prevent the misuse of these powers against photographers, which I know was a significant concern with the previous regime.

On the Regulation of Investigatory Powers Act 2000, we will implement our commitment to prevent the use of these powers by local authorities unless for the purpose of preventing serious crime and unless authorised by a magistrate. In this context, surveillance-the most controversial power-will be authorised for offences that carry a custodial sentence of at least six months.

On the wider question of communications data-that is the who, when and where of a communication, but not the content-the Government intend to ensure that as far as possible, they are accessed only through the revised Regulation of Investigatory Powers Act. We will bring forward specific legislation to this effect in a future communications data Bill.

The Government are committed to tackling the promotion of division, hatred and violence in our society. We must expose and confront the bigoted ideology of the extremists and prosecute and punish those who step outside the law. The review considered whether counter-terrorism legislation should be amended to tackle groups who are not currently caught by the law, but who still aim to spread their divisive and abhorrent messages. After careful consideration, we have concluded that it would be disproportionate to widen counter-terrorism legislation to deal with these groups, however distasteful we find their views. To do so would have serious consequences for the basic principles of freedom of expression. We therefore propose to use existing legislation, as well as tackling such groups through our wider work to counter extremism and promote integration and participation in society.

On the deportation of foreign nationals suspected or known to have been involved in terrorist activity, the review found no evidence that this policy was inconsistent with the UK's human rights obligations and found that it was legitimate and necessary to seek to extend the arrangements to more countries which would include independent verification. As Lord Macdonald says, the Government's engagement with other countries on these issues is likely to have a positive effect on their human rights records.

Finally, on control orders the Government have concluded that, for the foreseeable future, there is likely to be a small number of people who pose a real threat to our security, but who cannot currently be successfully prosecuted or deported. I want to be clear that prosecution,
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conviction and imprisonment will always be our priority-the right place for a terrorist is a prison cell. But where successful prosecution or deportation is not immediately possible, no responsible Government could allow these individuals to go freely about their terrorist activities.

We are also clear that the current control order regime is imperfect and has not been as effective as it should be. We therefore propose to repeal control orders. Instead, we will introduce a new package of measures that is better focused and has more targeted restrictions, supported by significantly increased resources for surveillance and other investigative tools. Restrictions that have an impact on an individual's ability to lead a normal life should be the minimum necessary, should be proportionate and should be clearly justified. The legislation that we will bring forward will make clearer what restrictions can and cannot be imposed. These will be similar to some of the existing powers used in the civil justice system, for example to prevent sexual offences and domestic violence.

These "terrorism prevention and investigation measures" will have a two-year maximum time limit, which will clearly demonstrate that these are targeted, temporary measures and not to be used simply as a means of parking difficult cases indefinitely. The measures will have to meet the evidential test of "reasonable belief" that a person is or has been engaged in terrorism. This is higher than the test of "reasonable suspicion" under the current regime.

Curfews will be replaced by an overnight residence requirement- [ Interruption. ]

Mr Speaker: Order. Whatever Members think, on either side of the argument, the statement by the Home Secretary on this matter must be heard with courtesy and in silence.

Mrs May: Forcible relocation will be ended and replaced with the power to order more tightly defined exclusions from particular areas, such as particular buildings or streets, but not entire boroughs. Individuals will have greater access to communications, including to a mobile phone and to a home computer with internet access, subject to certain conditions such as providing passwords. They will have greater freedom to associate. They will be free to work and study, subject again to restrictions necessary to protect the public. We will add the crucial power to prevent foreign travel. These measures will be imposed by the Home Secretary with prior permission from the High Court required except in the most urgent cases. The police will be under a strengthened legal duty to ensure that the person's conduct is kept under continual review with a view to bringing a prosecution and they will be required to inform the Home Secretary about the ongoing prospects for prosecution.

I have asked the incoming independent reviewer of terrorism legislation, David Anderson QC, to pay particular attention to these issues in his first report on the new regime and to make recommendations that he considers appropriate to ensure the new regime is working as intended.

I am also today laying a written ministerial statement outlining the next steps in the work to find a practical way to allow the use of intercept as evidence in court. We will repeal the current provisions which permit control orders with restrictions so severe that they would
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require the United Kingdom to derogate from the European convention on human rights. I cannot imagine circumstances in which the Government would seek to introduce such draconian measures.

So the review I am announcing today will create a more focused and flexible regime. However, in exceptional circumstances, faced with a very serious terrorist threat that we cannot manage by any other means, additional measures may be necessary. We want to prepare for this possibility while ensuring that such powers are used only when absolutely necessary. So we will publish, but not introduce, legislation allowing more stringent measures, including curfews and further restrictions on communications, association and movement. These measures will require an even higher standard of proof to be met and would be introduced if in exceptional circumstances they were required to protect the public from the threat of terrorism. We will invite the Opposition to discuss this draft legislation with us on Privy Council terms. These powers would be enacted only with the agreement of both Houses of Parliament.

All of these measures will be accompanied by a significant increase in resources for the police and security and intelligence agencies to improve their surveillance and investigative capabilities. This will underpin the effectiveness of the regime and support the gathering of evidence admissible in court which could lead to a successful prosecution.

We will bring forward legislation to introduce the new regime in the coming weeks. We want to give Parliament the opportunity to scrutinise our proposals properly. I am sure the whole House would agree that in the past, too many laws in this area were rushed through without the opportunity for adequate debate and consideration. So while Parliament considers that legislation, we will renew the current regime to the end of the year. Many of the other measures I have outlined will be brought forward in the forthcoming protection of freedom Bill.

I wish to finish by thanking the police and the security services for the tremendous work they do to keep our country safe. The measures I have outlined today will help them continue to ensure our safety and security at the same time as we restore our civil liberties. They are in keeping with British values and our commitment to freedom, fairness and the rule of law. They will restore public confidence in counter-terrorism legislation and it is my hope that they will form the basis of an enduring political consensus. I commend this statement to the House.

Yvette Cooper (Normanton, Pontefract and Castleford) (Lab): I thank the Home Secretary for her statement and for advance sight of the review. The horrific attack at Moscow airport brings home to us all the terrible damage, loss of life, carnage and fear that terrorist attacks can cause. The threats that we face from organised groups with international connections and lone individuals radicalised at home mean that our police and our security services face an incredible task in protecting this country. They match that threat with incredible effort. We pay tribute to the work that they do today.

The challenge for democratic Governments in the face of terrorist threats must be to protect both our national security and our historic freedoms. It is right to update powers and policies in response to ever-changing
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threats, so we welcome the fact that the review is being held. However, it would have been better to do this alongside a full assessment of the risks and challenges, through the updating of the Government's wider counter-terrorism strategy, Contest, which was due in January, but which I understand has now been delayed until the summer.

It is our responsibility as the Opposition to scrutinise the Government's proposals in detail and, wherever we can, to support the Government on national security matters on the basis of the evidence. We will support some of the measures that the Government have announced today. We support their approach to deportations with assurances to countries with which we can reach agreement, which continues the work that we did in government. We note that the Government have decided to continue with the existing regime for proscribing groups that are engaged in terrorism. That seems to be a sensible approach. Can the Home Secretary tell the House whether that means that the Prime Minister has abandoned his commitment in the Conservative manifesto to

We also agree that the use by local authorities of powers under the Regulation of Investigatory Powers Act 2000 should be restricted. Some of the uses that we have seen in practice go far beyond the intention of the original legislation. However, we will of course scrutinise the detail, as we agree that councils still need to be able to take action on issues such as the sale of alcohol or tobacco to those who are under-age. We also support sensible changes to stop-and-search powers to prevent their being misused, but it would be helpful if the Home Secretary could confirm that the legislative changes that she is proposing largely reflect the practical changes that the police have already introduced. I am still concerned about the implications for Northern Ireland, where, as she will know, stop-and-search powers have played an important role in preventing terrorist attacks. Is she confident, and is the Secretary of State for Northern Ireland confident, that the police will have all the powers that they need in Northern Ireland under the new arrangements?

Let me turn to pre-charge detention. In the last three years, no case has invoked pre-charge detention for more than 14 days, as the review makes clear. We have made it clear that if the best police and security evidence shows that we can reduce the maximum period for pre-charge detention from 28 days with sufficient safeguards, then we should do so. However, the Home Secretary's review concludes that there could be future circumstances in which detention for longer than 14 days will be required, saying that

The review recommends an emergency option to return to 28 days if necessary. However, the emergency legislation to do that is still not available in the Library. Indeed, it is still not ready, despite the commitment made by the Immigration Minister last Thursday. On Monday, the Home Secretary told the House that she could extend detention through an order under section 25 of the Terrorism Act 2006, yet her own review concludes that

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in that way

owing to the length of time that it would take to go through the House.

The Home Secretary is putting the House in a very difficult position. The old powers lapsed on Monday; her review says that she may need to restore them swiftly to deal with a difficult case; according to her review, the order-making power will take too long; and the emergency legislation is not ready. Why did she not make the emergency legislation available sooner, and why did she not wait until the emergency legislation was ready before she let the old powers lapse? As we have seen from the events in Moscow, this is an issue where we can never predict what is round the corner. What are the police and the Crown Prosecution Service supposed to do if a difficult and dangerous case emerges right now? And what on earth is the Home Office doing telling the House on Thursday that the legislation would be ready, on Monday that section 25 of the 2006 Act would be sufficient, and, in its review today, that neither of those things is right?

We know already that the Home Secretary's policies in this area have been a complete shambles, but they are also irresponsible. She has identified that emergency provisions are needed, but she has left the police and the public in a difficult position by failing to put those provisions in place. Indeed, we also have concerns about another aspect of the Home Secretary's approach. She is relying on being able to rush emergency legislation through in a hurry to deal with an individual and difficult case. Is that really a sensible way to proceed, with the possibility of Parliament being recalled in a recess in order to discuss the risks in an individual case, yet without prejudicing that case? I would urge her to think carefully about that approach, and about whether it would be better to develop more restricted bail conditions to apply beyond 14 days, so that emergency legislation is less likely to be needed.

Let me turn to control orders. We all know that this is a difficult area. I think that everybody recognises that no one wants to use control orders, but we accept the conclusion of the review, which is that there is a continuing need to control the activities of terrorists who can be neither successfully prosecuted nor deported. We have said that we are ready to look at alternatives to control orders if the evidence supports that. However, the proposals that the Home Secretary has set out today are not an alternative approach to control orders; they are simply amendments to control orders. Many of the same elements remain: restrictions on movement and communications; and a review by the court at the instigation of the Home Secretary, with special arrangements in place. I would ask her to explain to the House the difference between an eight-hour curfew and an overnight residence requirement. Is not the truth of it that what the Government are doing is a political fudge? The Deputy Prime Minister told the BBC that he had abolished control orders. Is not the truth that he has simply abolished the name?

We need to ask some detailed questions about the proposed amendments. We would like to be able to support sensible changes to control orders, but we need answers to some important questions. First, the Government
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are introducing a two-year limit, with a requirement for new evidence before a control order can be renewed. Lord Carlile's last annual review of control orders said:

three of the controlees

Those three individuals have been on control orders for more than two years, so will they now have their orders revoked, and what measures will be put in place to keep the public safe from the threat that Lord Carlile and the police clearly believe they pose?

Secondly, can the Home Secretary tell us whether the changes will mean a reduction in the restriction that the Government are currently imposing on the remainder of the eight people who are currently on control orders? Thirdly, the Home Secretary has made it clear that she intends to rely more heavily on surveillance and less on the measures under control orders. We would support the greater use of surveillance, especially if it were to increase the chance of prosecution, but I am concerned about whether there will be sufficient resources for an increase in surveillance. The Home Secretary has talked about increases in surveillance, but we have not had clear figures about what exactly that will mean. The Daily Telegraph appears to have been told that there would be a £20 million increase for the police and security services, but we have not been told exactly what that means. Can she confirm that the £20 million for surveillance operations, or whatever the figure is, will not be ring-fenced, and that it follows a £150 million cut in the counter-terrorism budget and billions of pounds of cuts for the police? Can she assure the House that she is confident that the police and the security forces will have the resources that they need to keep Britain safe from terror?

This has been a chaotic review, delayed, confused, riven by leaks and political horse-trading, and culminating in a political fudge. It is a review with serious gaps, which raise serious questions about security and resources, and the public and the people who work to keep us safe deserve better. The rhetoric of opposition has now come up against the reality of government. The review has been muddled in its formation and chaotic in its announcement; the Home Secretary must ensure that it is neither of those when she implements it in practice.

Mrs May: May I start by welcoming the more measured approach that the shadow Home Secretary took in the early stages of her response to my statement, and her stated commitment to ensuring that we work together in the interests of national security? I sincerely hope that we shall have cross-party dialogue and agreement on matters that are indeed of national interest in ensuring our national security. Sadly, however, in the time that I have been Home Secretary, such a response has not been noticeable from the Opposition Benches up to now, but I live in hope that that prospect will change.

The right hon. Lady also supported our proposals on deportation with assurances, and our continuing work on that with other countries is important. On proscription, I can assure her that we are actively looking at the issue
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of Hizb ut-Tahrir, and we do not resile from our commitment to ensure that action can be taken on the sort of groups that we have described. She supported what we are doing on the Regulation of Investigatory Powers Act 2000, and on local authorities in that regard. I am pleased to hear that, although it might have been nice to hear an apology from her for the use of RIPA by local authorities under her Government. I believe that that is one of the things that has damaged people's confidence in counter-terrorism legislation.

The right hon. Lady also referred to section 44, and asked about the changes, which she said were introduced by the police last summer. Those changes were not introduced by the police; I changed the guidance to the police following the European Court of Human Rights judgment. It was entirely right that we did that, when a judgment had been made against us. The police have been operating under the new guidelines. Having looked at the judgment, we believe that it will be possible to introduce legislation, whose use will be very tightly circumscribed, to cover any potential gap in the powers available to the police as a result of the ECHR judgment.

The right hon. Lady referred to Northern Ireland. I specifically made reference to Northern Ireland in my statement, and I have been discussing these matters with the Secretary of State for Northern Ireland and the Chief Constable of the Police Service of Northern Ireland. The Secretary of State has been in touch with the Chief Constable and with the Minister of Justice in Northern Ireland to ensure that the measures that we introduce will indeed provide the capabilities that the PSNI needs for the difficult work that it does. I should like to pay particular tribute to the PSNI, because we have seen a significant increase in the number of potential attacks, as well as in the number of terrorist-related arrests and charges, in Northern Ireland over the past year. The PSNI is doing valuable work in keeping the people of Northern Ireland safe.

The right hon. Lady talked about pre-charge detention, and that was when her more measured, conciliatory and consensual approach started to disappear. She made an awful lot of the issue about whether draft legislation had been laid before the House. The Minister for Immigration, my hon. Friend the Member for Ashford (Damian Green) did not promise that it would be laid before the House last Thursday. He said that we would be laying draft legislation before the House. It is my intention to discuss this draft legislation with the Opposition. As I said in my statement, we intend it to be the subject of pre-legislative scrutiny, so that, if and when it is necessary to introduce the emergency legislation, the House will already have had an opportunity to scrutinise it.

The right hon. Lady also tried to make quite a lot of the gap in the emergency provision that would be available, and about the length of time that it would take to get emergency legislation through the House. It is perfectly possible to get emergency legislation through Parliament in a day; it has been done by previous Governments. I might also remind her that this is exactly the same procedure that was adopted by her Government in relation to their proposals for 42 days pre-charge detention.

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