[Mrs Linda Riordan in the Chair]
Despite the unbelievable transformation of our city during 13 years of Labour Government, Liverpool’s socio-economic problems are common knowledge and have been touched on by my hon. Friends. The problems are disproportionately concentrated in north Liverpool and their consequences correspondingly magnified. There is a complex and historical mix of issues, such as low educational attainment, a low skills base, high welfare dependency, poor housing, low or unskilled and often casual employment, and poverty of aspiration. Those factors have made for a potent, self-perpetuating, cyclical
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cocktail of disadvantage and marginalisation. I have spent more than two decades working hard for Liverpool, and I am determined to continue that fight here today.
In the 12 pathfinder areas, there was demonstrable market failure in the housing sector and the £2.2 billion housing market renewal initiative essentially recognised what we needed to do to tackle poor housing conditions. Despite some justifiable criticism that it was not always sufficiently focused or sufficiently geographically specific to meet Liverpool’s needs, it started to address one of the multiplicities of interconnected problems that areas such as my constituency face. It was housing market failure that created neighbourhoods with a large number of vacancies, owners trapped in negative equity and the unwelcome attention of speculators. I concede that the scheme was not perfect, but, much like the future jobs fund, it was at least a programme to address specific needs. For that reason, moderate reform rather than radical abolition would have been the sensible thing to do, but, no, not for this Government.
Despite what I am sure were its best intentions, the previous Lib Dem city council in Liverpool got things disastrously wrong, and now the Liberal Democrats and their Tory partners are trying to finish us off completely. Instead of taking a break, as they did with the health care reforms, to consider all the options available, the coalition Government have simply turned off the regeneration tap in areas such as Walton. In this very Chamber, only two weeks ago, I led a debate on the construction sector and highlighted the damage that the scrapping of HMR and other initiatives was doing to the industry. It is generally accepted that HMR alone has generated £5.8 billion-worth of economic activity and created 19,000 construction jobs. So the Government’s decision to scrap HMR was devastating not only for residents trapped in properties in areas that look like they have been bombed, but for the construction industry in general. It would not have been so bad if the Government had recognised the serious socio-economic problems of HMR areas, but instead they have once again hit the most deprived parts of the country hardest.
Government Members are desperate to blame the previous Labour Government by using the tired old mantra that it is all our fault, but the economic argument is that for every £1 invested in construction, £3 is generated and a further £2 is generated in the wider economy. So, instead of paying benefits to building workers who are desperate for jobs but who are forced to sit at home, the Government could have invested in construction to ensure a return on their investment and the creation of jobs and apprenticeships. The Government chose not to do that; instead, they chose to cut and run.
It is disappointing that the Minister for Housing and Local Government is not responding this morning to our serious questions—metaphorically speaking, this is not the first time that a Lib Dem has taken a bullet for his Tory master. The Minister will be keen to lay the blame squarely at the door of the previous Labour Government. However, whether or not there was money in the Exchequer, there appears to be an ideological motive for this callous and cynical decision, which has caused so much distress in areas such as Liverpool.
12.1 pm
Alison Seabeck (Plymouth, Moor View) (Lab):
Thank you, Mrs Riordan, for your chairmanship—albeit rather briefly—of the debate. I draw hon. Members’ attention
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to the entry in the register made by my right hon. Friend the Member for Greenwich and Woolwich (Mr Raynsford) in which I have an indirect interest. I congratulate my hon. Friend the Member for Liverpool, Wavertree (Luciana Berger) on securing the debate. It has been marked by excellent contributions and a strength of feeling expressed by my hon. Friends, whose constituents are most affected by the Government’s complete volte-face on funding for the housing market renewal programme.
The Minister should not be surprised by the anger and frustration voiced today, when the messages from his colleagues indicate yet again that the left hand does not know what the right hand is doing. The decision to cut half the money promised by the Government at the Dispatch Box by the Minister for Housing and Local Government as recently as October 2010 has been devastating. Many hon. Members have commented on his absence today. I can tell hon. Members that, as we speak, he is busy tweeting about holding a round table on social mobility. In that round table, I hope that he is talking about HMR and the impact of his policies on social mobility.
It is worth noting and repeating the precise words that the Minister for Housing and Local Government used:
“We will complete all the committed HMR schemes, and we will then roll the funding up into the regional development fund to continue the good work.”—[Official Report, 21 October 2010; Vol. 516, c. 1114.]
Is that not pretty unequivocal? He then confirmed the position in a letter to local authorities, in which he said:
“we will also provide access to the Regional Growth Fund to fund capital projects which could support housing growth”.
I suppose we should be getting used to Ministers saying one thing in Parliament one day and then changing it the next. Most recently in fact, just a couple of weeks ago in a debate on social housing in this Chamber, the Minister for Housing and Local Government made a number of statements that he has subsequently had to correct or elaborate on. There were seven such instances in all, including one policy change. I hope that the Minister responding today will not find himself having to come back with a stream of corrections. There is a question of competence here.
It is therefore a shame that Lord Heseltine, who has been tasked with heading up the independent approval panel for bids to the regional growth fund, does not appear to be singing from the same hymn sheet. Perhaps he is as confused by the Government’s constant chopping and changing as the rest of us. When he was pressed by the Select Committee on Communities and Local Government, he was very clear indeed that the regional growth fund is not in any way a replacement for housing market renewal funding. What happened to the circular that the Minister put out? Did Lord Heseltine simply ignore it, or perhaps the status of the edict from the Department for Communities and Local Government was simply lost on the chairman of the approval panel. To his credit, Lord Heseltine has a considerable understanding of regeneration projects and, after the Toxteth riots, he got heavily involved in trying to make significant changes and improvements to some of the country’s most run-down communities through regeneration. There were, of course, two housing-related
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bids in the first round of bidding with one in Hull and one in Wakefield, but since then the emphasis has clearly changed.
It is telling that the Localism Bill does not mention the importance of regeneration to some of our poorest communities. However, let us be honest. That is not the Government’s vision for the new powers that the Bill will introduce. The bids already in for neighbourhood forums support the view that those powers are largely for affluent areas in the south-east or in the suburbs of our major towns. Neighbourhood forums are not being set up in Hyndburn, for example. Perhaps those marooned local residents should be thinking about setting up a neighbourhood forum in order to try and have a say in how their community might be shaped in the future—not, I hope, under a Tory Government.
Why did the former pathfinder chairs feel the need to press the case for the full £60 million to remain committed? They know, because they have worked on the ground, just how important it is to rebalance and invest in these communities. They also know the cost of not proceeding and the waste of investment that has already been put in. Perhaps the Minister should read his own Department’s discussion papers in which it is clear that in order to tackle worklessness the lack of aspiration needs to be dealt with. Part of that is about people feeling valued. Someone’s home and their wider environment play a significant role in that. Let us imagine waking up every morning in a semi-derelict landscape, where all the community facilities and local shops are closed. It is almost impossible to conceive how dispiriting and demoralising that must be. If the Government are serious about the private sector stepping in to support new jobs, they need the conditions for that to happen. The private sector will not move into derelict sites where no one, including their potential workers, wants to live. There needs to be some pump-priming.
My hon. Friend the Member for Hartlepool (Mr Wright)—a former very respected Housing Minister, who understands the nature of the problem—set out clearly the reasoning behind the scheme and, most importantly, the economic benefits. The Government have taken a number of decisions that have impacted seriously on house building, regeneration and, as we have heard, the construction industry. This Government’s decision arbitrarily to select just five areas for continued investment and to allow councils to ignore the regional house building targets resulted directly or indirectly in plans for more than 200,000 homes being dropped.
My hon. Friend the Member for Liverpool, Wavertree has highlighted the problems and has mentioned some of the excellent work using previous funding to try to lift some of the affected areas. During the recess, I hope to see at first hand some of the problems that she has described so vividly. My hon. Friend the Member for Hyndburn (Graham Jones) gave a wide-ranging and expert analysis of HMR and its importance to the area that he represents.
My hon. Friends the Members for Stoke-on-Trent South (Robert Flello) and for Stoke-on-Trent North (Joan Walley) described how the scheme was just starting to have an impact. Clearly the rug has simply been pulled from under the feet of those concerned. My hon. Friend the Member for Stoke-on-Trent North made a plea for a cross-cutting approach. Sadly, I have to tell her that the Government are simply doing the cutting
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part. She also touched on business rates, which are extremely relevant. That was a point very well made. I hope that the Minister will take that away, because the impact on areas such as hers could be significant if, again, the decisions taken are the wrong ones. My hon. Friend the Member for Liverpool, Walton (Steve Rotheram) is an assiduous debater on this and related issues. He flagged up an alternative, more pragmatic approach that the Government might have followed and pointed out that they simply chose not to do so.
Labour Members have tried hard to clarify this matter and have raised the issue on the Floor of the House. My hon. Friend the Member for Birmingham, Erdington (Jack Dromey), who is in this Chamber today, has—I hope he will forgive me for saying this—been like a dog with a bone. He, too, has written to the Minister for Housing and Local Government, most recently on 29 June, but there has been no answer. Perhaps the Minister for Housing and Local Government has been too busy writing corrections to the previous debate. My hon. Friend asked some straightforward questions in his letter, many of which have been asked again today by my hon. Friend the Member for Liverpool, Wavertree, and I shall add to her list. Will the Minister make it absolutely clear whether Lord Heseltine is correct in saying that the regional growth fund will not cover HMR or anything of that sort?
Importantly, my hon. Friend the Member for Liverpool, Wavertree also asked whether bids, which have been prepared at some cost to local authorities, will be considered at all by the approval panel. If not, will local authorities be reimbursed, given that they were quite clearly sold a pup by the Government? Perhaps in the absence of a written reply from the Minister for Housing and Local Government, the Minister can, in summing up, answer all those questions, because he will have adequate time to do so. I hope that we get good, full, oral answers and that we do not have to wait for updated written answers.
12.10 pm
The Parliamentary Under-Secretary of State for Communities and Local Government (Andrew Stunell): It is a pleasure to serve under your chairmanship for what I think is the first time, Mrs Riordan. I congratulate the hon. Member for Liverpool, Wavertree (Luciana Berger) on bringing this subject to the Chamber. I should perhaps say that my right hon. Friend the Minister for Housing and Local Government recently met the hon. Lady to discuss regeneration in her constituency. He also took the opportunity to visit Merseyside in May to see the work being undertaken in both Liverpool and Sefton. I have also visited Liverpool, so I have seen successful, and perhaps less successful, schemes and their outcomes.
Luciana Berger: I just want to reinforce a point that I made earlier. One reason for securing the debate is that while the Housing Minister did come to Liverpool, during a meeting there that was attended by a wide range of people from the local communities affected by the cut to HMR, he said that we in Liverpool could apply for money from the regional growth fund. As that has now been proven to be not the case, further to the evidence given by Lord Heseltine in the Communities and Local Government Committee, it is really important that we receive answers about that today.
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Andrew Stunell: I certainly intend to give answers about that.
Perhaps I should say something about the baggage that I bring to the debate. I first secured elected office in 1979, having run a successful local campaign to prevent the wholesale demolition and redevelopment of homes in Chester. I am happy to say that those homes are still there and are now seen as highly marketable assets. We all bring different stories and different perspectives to the debate. I am well aware that good regeneration work has been undertaken in Merseyside and elsewhere, and I am also well aware of the challenges that have been faced in the area. The hon. Member for Liverpool, Wavertree mentioned the Picton and Kensington renewal areas in her constituency.
Several contributors to the debate have acknowledged that not all housing market renewal schemes got off on the right foot. Not all of them were pursued in the right way and, in fact, not all of them were appropriate. A number of them certainly generated significant local controversy and failed to engage properly with local communities. Quite often, the renewal process divided local opinion. Amid the understandable passion that has been brought to the debate, it is important that we keep some perspective on that particular point.
I shall start by responding to some of the specific points that were raised before going on to deal with several of the broader points that I think need to be set out. The hon. Member for Stoke-on-Trent North (Joan Walley) asked for several specific assurances. Officials from my Department are more than ready to work with Stoke-on-Trent council and others on the future direction of the north Staffordshire regeneration area. Indeed, officials are already in discussion on the basis of the bids and applications that have been put in for the £30 million match funding that has been referred to, so I am happy to give her that assurance. I have visited Stoke-on-Trent and looked at some of the situations that she described.
Joan Walley: My concern is not just about the transitional fund and securing our share of it, because that is geared towards demolition. I want to see how all the different funding can be aligned so that we can get investment in homes, communities and local regeneration. If the Minister can help with that, I will be very happy to do whatever I can to facilitate it.
Andrew Stunell: At the risk of having to issue a correction—I do not have a magic wand—I can say that those discussions will be wide-ranging. Of course, they can be as wide-ranging as Stoke chooses to make them.
I want to move on to something that I am sure the hon. Lady will want the official discussions to cover. She mentioned the link between enterprise zone applications and regeneration. She is absolutely right to say that there should be as much synergy as possible in public investment, or in public stimulation of private investment, in both of those. It is entirely right and proper that discussions range across the boundaries and that we should not put these things in separate silos.
The hon. Lady also asked specifically about the local government resource review and the Government’s announced, albeit not yet detailed, proposals for returning business rates to local authorities. I do know the answer to her question; indeed, it has been given from the
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Dispatch Box. However, she will have to wait for the detail of that answer for one or two weeks, when we actually publish the proposals—the correct civil service word for that is probably “imminently”. I assure her that neither Stoke-on-Trent nor any other local authority will find themselves at a financial disadvantage in the first year of the operation of the scheme. It is central to the proposals that we are bringing forward that that should be the case.
Joan Walley: I realise that time is short, but our concern is not just about being disadvantaged in the first year; it is about the level on which future decisions are made. We could well find ourselves falling severely behind after three years. Will the Minister please feed that back into the final version when he announces it in two week’s time?
Andrew Stunell: The hon. Lady’s point is thoroughly understood. I do not think that she will be disappointed, but she is tempting me on to territory on which it really is not right for me to advance.
Alison Seabeck: Just for absolute clarity, I would appreciate it if the Minister would clarify something that he said. He stated that authorities would not be disadvantaged in the first year. Given that many of these housing and regeneration projects are much longer programmes, I think that we would all have serious worries if, after the first year, those authorities were disadvantaged as a result of the changes.
Andrew Stunell: I was responding to the suggestion that Stoke-on-Trent might lose £26 million. Stoke-on-Trent will not lose £26 million. I think that I have already made our intentions clear. There have been some other statements, but the detail of the scheme will be well debated when it is published, so I think it is best if I go on to respond to several of the other points that were made in the debate, if I may.
It is way over the top for the hon. Member for Hartlepool (Mr Wright) to say that the Government’s decisions have set areas back by decades. That is absolutely not the case. Investments have been made and, even in this debate, reports have been given of their success. It might be said that there is a greater belief in the successes among Opposition Members than Government Members. It is absolutely not the case that such work will be set back as a result of the decisions that have been made.
I want to link that to what the hon. Member for Hyndburn (Graham Jones) brought to the debate. I leave aside his dismissal of deficit reduction, because that sensible Government aim underpins our whole financial strategy. The hon. Member for Hartlepool must be well aware of the deficit problems found by the incoming Government. However, the hon. Member for Hyndburn cannot have his argument both ways: it seemed to be that the fundamental difficulty in east Lancashire was too many homes and not enough people, in which case it can hardly be wrong if the new homes bonus generates more houses in places with more people than it does in places with an excess of houses. I want to tell—
Graham Jones: Will the Minister give way?
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Andrew Stunell: I might give way in a moment, but not until I have finished my sentence at least.
I want to tell the hon. Gentleman that the £62,000 is the first payment in six years of payments on the homes brought into use in his area in the past year. That will be augmented by the homes brought into use in successive years. That £360,000 is real, additional money that Hyndburn would not otherwise have received. Some local authorities—Sefton metropolitan borough council, for instance—have used the incoming income as an underpinning guarantee to raise loans and finances in order to proceed with regeneration. That was one of the projects that my right hon. Friend the Housing Minister visited in Merseyside a few weeks ago.
Graham Jones: I was clear about what I said: if there is an oversupply of houses—more houses than people—there is low demand, and therefore, naturally, less from the new homes bonus. Hence we end up with the figure of £62,000, which is the 11th lowest in the country. The argument is perfectly logical, but it falls down when the Housing Minister says on the Floor of the House that we should not worry about losing housing market renewal because we will get the new homes bonus. That is where the argument falls down; the rest is linear with all the ducks lined up—that is my point. On the Under-Secretary’s mention of extra money, the new homes bonus is being top-sliced from the formula grant after year two, and it is also being taken from the planning delivery grant, so I do not accept his point.
Andrew Stunell: First, my right hon. Friend the Housing Minister has certainly not said that regeneration will be funded by the new homes bonus—his point was that it is an important contribution. The example of Sefton shows that local authorities are well able to exploit that and to benefit.
Jack Dromey: Clarity on the issue of the regional growth fund is of the highest importance in circumstances in which the Minister for Housing and Local Government has treated the House with contempt by not being here today and by not replying to my letter of 29 June. The Housing Minister has said on the Floor of the House and in a letter to local authorities that the regional growth fund can be accessed for capital projects to support housing growth. However, Lord Heseltine has said that housing renewal is not being addressed through the regional growth fund. He went on to say:
“perhaps any minute now I’ll get a letter”.
Perhaps any minute now we will get an explanation or a letter—or both.
I have a final point to make while I am on my feet. Earlier, following powerful representations from Members of Parliament affected by the cruel cutting short of a visionary programme, the Minister described what they said as “sob stories”. Will he take the opportunity to withdraw what he said?
Andrew Stunell: Let us focus on the regional growth fund because time is limited. The spokesperson for the Opposition said that round one of the regional growth fund supported bids in renewal areas in Hull and Wakefield, so it is absolutely not the case that regeneration projects are not being funded by the regional growth fund.
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I was not privy to the evidence of Lord Heseltine, but I have seen the reports and heard the quotes, and he said that the terms of reference of the regional growth fund are to promote—funnily enough—growth in the regions. There is no automatic link to housing market regeneration projects although, as hon. Members have mentioned, there are employment, environmental and social benefits to successful regeneration. I take it as clear that the bids accepted from Hull and Wakefield must have met the criteria of supporting growth, as well as the social and environmental criteria about which hon. Members have spoken today.
The bids for round two of the regional growth fund have been submitted and are, no doubt, being evaluated by Lord Heseltine’s advisory committee. The bids are signed off by the Government.
Jack Dromey: We need absolute clarity: are we therefore returning to the original position? In the Housing Minister’s letter to the local authorities, he said:
“we will also provide access to a Regional Growth Fund to fund capital projects which could support housing growth”
and housing renewal. Are the Government now saying that the regional growth fund can be used for such purposes?
Andrew Stunell: Not only that it can, but that it has. In Hull and Wakefield, it has been used for such purposes. All bids must be evaluated, their strength must be measured and their contribution to growth must be considered. It is therefore not the case that a large slice of the regional growth fund is diverted into social and housing regeneration. However, when social and housing regeneration can contribute to growth, a project will be not only eligible but, as in the cases of Hull and Wakefield, successful.
I will now make some progress—
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Jack Dromey: Will the Minister give way?
Andrew Stunell: No, I will not give way. I have made the point absolutely clear and I am moving on.
On the former renewal programme, the reality of the fiscal deficit means that we have had to take tough decisions about where savings can be made and to ensure that we focus on growth. The previous Government’s programme was far too centrally driven from Whitehall and, by proxy, sometimes too centrally driven from town halls. It included targets for demolition and, in that sense, it was all too literally top-down, as the hon. Member for Stoke-on-Trent North acknowledged. It resulted in imposed schemes that were often resented by local communities and created as many problems as they solved. That approach has not worked, and has often resulted in blighted areas in which large-scale demolition and clearance projects have come to a standstill.
In my last minute, I shall speak about the sum of £30 million, which is to be matched by other funding. Bids have so far been received from all five eligible areas and the indications are that the match funding will be available, thus allowing £60 million to be spent. That £60 million is the assessment of what is needed to get the existing schemes into a shipshape position—viable environmentally and locally—so that the next stage of development in those areas can happen. There is a process, and I can tell the hon. Member for Liverpool, Wavertree that Liverpool city council has submitted a substantial bid. Officials will consider it and, no doubt, will make recommendations to Ministers in due course. We are ensuring that, at the national level, £261 million is available for market renewal in 2010-11, which is a substantial amount. Also, the reason why the five were chosen was not arbitrary, but because of the improvement in those areas—
Mrs Linda Riordan (in the Chair): Order.
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Drivers and Diabetes
12.30 pm
John Thurso (Caithness, Sutherland and Easter Ross) (LD): I rise to raise the matter of type 2 driving licences for public service vehicles and large goods vehicles, particularly disqualification as a result of having insulin-dependent diabetes. I raise the matter primarily because a constituent, Mr Donald Campbell, has brought it to my attention, having had his licence removed in curious circumstances, which I will come to. However, I would like to say at the outset how grateful I am to Diabetes UK and other people who have been in touch to brief me on this debate.
May I say at the outset that I do not for one moment question that it is absolutely correct that, when medical conditions may cause a safety issue, they should be proscribed? A range of conditions are taken into account, and people who suffer from them, whether they hold group 1 or group 2 licences, may be prevented from driving. I do not for a moment question that. Having been a transport spokesman for my party two Parliaments ago, and having been a member of Standing Committees on various legislation, I am well aware of the importance of road safety and of this country’s extremely good track record. We obviously want to keep the number of deaths and injuries to an absolute minimum; we have a good track record compared with many other countries, and nothing should be done to prejudice that.
At the same time, although it is proper that people with some medical conditions should be prevented from driving, others—with proper supervision and consultation, perhaps with annual or periodic check-ups—should properly be permitted to drive. The other question is whether it is right to remove someone’s livelihood in the case of a group 2 licence when the example of other countries and, indeed, medical advice suggest that that is unnecessary.
I will give a rapid history, which I am sure the Minister is as well aware of as I am. The regulations precluding insulin-dependent diabetics from obtaining vocational licences were introduced in 1991, and annex III specifies that for drivers of LGVs and PCVs,
“driving licences shall not be granted or renewed for applicants or drivers who are diabetics needing insulin treatment”.
Since 1 April 1991, insulin-dependent diabetics have been barred by law from applying for such a licence, and indeed from renewal thereafter. A point in parenthesis is that those who held a licence under certain conditions had grandfather rights, and some people may still be driving with those rights. I will come to why that is important.
In August 2009, following reports from three medical working groups, the European Commission adopted an amending directive, 2009/113/EC, on the driving licence rules covering eyesight, epilepsy and diabetes. The change to the rules allows member states to issue group 2 licences to drivers with insulin-dependent diabetes when, in the opinion of a qualified medical practitioner, the condition is properly controlled and they pose no risk to themselves or other road users. That change should have been in force by August 2010, but the UK was unable to meet that deadline, and a consultation paper was eventually put out in February this year. The consultation has now closed, but I understand from a
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reply from the Minister to a parliamentary question that the Government are now saying that further input from some of those who have responded may be necessary. That is the situation at present.
My constituent, Donald Campbell, has type 2 diabetes. He was diagnosed in 2000, but was not treated with insulin until 2005, when he was advised by doctors to change his medication to slow-release insulin to protect his long-term health. Since then, his health has improved considerably, for which I am grateful, and at his annual check-ups his consultant tells him he is going from strength to strength. Mr Campbell notified the Driver and Vehicle Licensing Authority of his use of insulin in 2005, and his LGV licence was immediately withdrawn. However, two years later, in August 2007, the licence was reinstated. Mr Campbell was obviously extremely pleased about that, and returned to full-time driving with no problems. He renewed his licence in 2008 and 2009, so he had three years of driving. Not until last summer did the DVLA recognise that under the present regulations, it had reissued Mr Campbell’s group 2 licence wrongly. While Mr Campbell was driving, he experienced no problem whatever, and he has been driving alongside those with grandfather rights—hence their importance—and those from other EU countries who have already been given the right to drive on such licences. At the moment, his job is being held for him pending the possibility that the UK will catch up.
This is an opportunity for the Minister to right a long-standing wrong perpetrated by the EU. Had there been no original directive, undoubtedly the traditional elements of British fair play would have come into effect, and the sort of rules we are now contemplating would almost certainly have been those that Her Majesty’s Government adopted. It has come to pass that the EU, having seen the error of its ways, has put in place that which will allow the Minister to correct an obvious wrong—I know how much that will appeal to him. The change is open and available, and has been adopted by other EU countries, so it is peculiar that we are dragging our feet; perhaps the Minister will address the reason for that, and the safety aspect. Why are we content that drivers from all sorts of other countries enjoy that relaxation and are considered safe, but we do not extend that to our own people? Are there are any statistics showing whether insulin-dependent drivers are more likely than others to have an accident?
Mr Adrian Sanders (Torbay) (LD): I congratulate my hon. Friend on securing this debate, which is not the first time in the last 15 years that the House has discussed the matter. I have had a similar debate. I suffer from diabetes, and I know people who can win gold medals, and others whom I would not trust to drive my lawn mower. The reality is that the decision should be based on an individual medical assessment, and I hope my hon. Friend agrees.
John Thurso: I entirely agree with my hon. Friend. The whole point of my case is that the medical profession can, with considerable accuracy, state when people should be taken off the road—I am sure that they apply a precautionary principle—and when they may be allowed to continue to drive. I am particularly concerned about group 2 licences—commercial licences—and my constituent. I received a recent e-mail from him which sums up the situation:
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“I am sorry to be such a pain”—
he is no pain at all, I hasten to add, and has been extremely patient—
“but I am so exasperated with the whole issue—every time they take my licence away I am left trying to keep things going financially and this time they have wiped me out…Between the worry of keeping the bank off my shoulders and the boss needing to know when I’m coming back to work, I am drained.”
That shows the personal impact on my constituent. Given that the rules may be about to change and that the Government have put forward proposals that would permit him, subject to medical examination, to get back on the road and back to work, I suspect that he feels a little like a mouse that is being toyed with by a cat. The Government owe their citizens better than that. I throw myself at the feet of the Minister, whom I know is an honest and honourable man, and plead with him to lift that burden from my constituent.
12.40 pm
The Parliamentary Under-Secretary of State for Transport (Mike Penning): It is a pleasure to serve under your chairmanship for the first time, Mrs Riordan, as either a Back Bencher or as a Minister of the Crown. I hope to provide a little good news for the hon. Member for Caithness, Sutherland and Easter Ross (John Thurso)—it is easier to say Hemel Hempstead, but I mean no slight on the hon. Gentleman’s constituency and congratulate him on securing this debate. I have been a Minister a little longer than some others who have held the post over the years—the average life expectancy of a Minister in my job is eight months, so a year and a bit is an exception. I have taken a particular interest in the case of Mr Campbell and, as I am sure the hon. Gentleman realises, in the involvement of the European Union in this great country of ours.
I will summarise the details of the case mentioned by the hon. Gentleman and endeavour to address some of the issues, particularly those relating to Mr Campbell. At the moment, the law is specific, which was not done on my watch—although it is my Department and the buck stops with me. When the Driver and Vehicle Licensing Agency gave the licence back to Mr Campbell, it messed up. I know that it wrote to him, and I have a copy of the letter, which could have been worded better and showed more empathy and understanding about the effect that the decision on his licence would have on Mr Campbell, his family and the company for which he worked. I apologise for that, and if Mr Campbell were present today, I would apologise to him personally. We need to address problems as we go forward. I cannot right the wrongs of the past, but we can try and ensure that they do not happen again. We must look at how best to address such situations, and avoid the foot-dragging to which the hon. Gentleman—probably quite rightly—has alluded.
The law in question concerns epileptic fits, diabetes and visual impairment. The consultation by the DVLA has been well taken up and a lot of work has been done. However, the situation is complicated, because the law includes those three areas. The areas of visual impairment and of fits are more complicated than that of diabetes, but all three issues have been rolled into one. The hon. Gentleman is right: ideally, we would have produced proposals to address all three areas by now, but, if I am honest, we will be unable to do that by the October
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deadline. As I have said to my officials, we will produce proposals on diabetes, which will be based on clinical advice. I will be subject to criticism from those involved in the other areas on which we are not yet ready to introduce proposals. My view, however, is that if we are ready to introduce proposals in one of those areas—by October, we should have a proposal on diabetes—we should go ahead and remove the blight that affects not only the hon. Gentleman’s constituent but many other people around the country.
It is imperative that we do that that without affecting road safety and, as the hon. Gentleman said in his opening remarks, that is the principle from which we start. The UK has a good record on road safety—indeed, we have the safest roads in the world. A new report on the number of people killed or seriously injured on the roads last year indicates that we are now doing even better. Over the years, we have struggled in some areas of road safety to get the right results, particularly concerning serious injuries for motorcyclists, but—as a biker, I declare an interest—we did particularly well in that area last year.
Of course, there are too many deaths, and we need to look at the core of the issue, which we are doing in the road safety strategy. It is, however, absolutely imperative that we do not use a sledgehammer to crack a nut. Medically, the treatment of type 2 diabetes has moved on in leaps and bounds to say the least. I was a shadow Health Minister for three and a half years and I took a particular interest in the public health side of things. Soon, we will be moving away from injections altogether, because there will be aspirators, and we can make it much easier for diabetic patients to get on with their lives and address their insulin issues.
The issue of hypos is important, as are other matters such as visual impairment. My point of view as a non-medically trained Minister is that a clinician must decide whether someone in the groups that we are talking about—particularly group 2—is fit to drive. Hopefully we will bring forward proposals on diabetes in October. We are further behind in the other two areas and, as the hon. Gentleman said in his remarks, we need more consultation on those issues, in particular on the control of epileptic fits.
There is some concern from the road safety lobby that we will be reliant on people addressing their need for insulin treatment themselves. Two members of my family are reliant on insulin—one is a type 1 diabetic; the other is a type 2 diabetic. They sometimes get it wrong, and everybody understands that. We must have full confidence that if diabetes is controlled by insulin, the condition is stable and the clinicians are happy with the situation. If that is the case, we should be able to agree in October that after medical assessment and agreement—which will be continually assessed as things progress—we will allow insulin-reliant diabetics in the classes mentioned by the hon. Gentleman, and particularly those in group 2, to drive. I said that there is some good news.
That will not, however, address the problems experienced by Mr Campbell. Under the present rules, the DVLA was right to take his licence away and fundamentally wrong to give it back and not to pick up the mistake sooner. Everybody makes mistakes, but it is crucial to
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ensure that such things happen as little as possible, because they have such dramatic effects on people’s lives.
The hon. Gentleman asked whether statistics are available to show whether diabetics who are reliant on insulin are more likely to be involved in an accident. As I understand it, we do not have such statistics and when the European Commission looked into the matter, it used the fact that there was no evidence available to change its mind. As hon. Members will realise, I am ever so slightly Eurosceptic, so it is great news that UK plc is again allowed to be in control of procedures and safety on our roads. Our borders are open to anybody from the European economic area or the EU who wishes to drive in this country, which is right and proper.
I fully accept that other countries have moved faster than us, but they do not have roads that are as safe as ours. Many of their Ministers and officials come to see me to see how we manage to have such safe roads. If they were slightly more vigilant in how they enforce road safety, the position might be different. In the area that we are debating today, they may have got things right a little more quickly than us. I fully accept that there is an anomaly between on the one hand drivers with grandfather rights and overseas drivers and on the other hand UK citizens who are being penalised. I think that we will be able to wipe that away very soon—in October, I hope.
John Thurso: I am extremely grateful for the reply that the Minister is making, in terms of both the tone—I am sure that my constituent will have noted his remarks and be grateful for them—and the good news in respect of diabetes. The Minister has mentioned October. Will that be when the Government promulgate the change to the regulations? Am I therefore accurate in saying to my constituent that he might look forward to being able to take the medical exam in October, permitting him to go back to work shortly thereafter?
Mike Penning: I think that Mr Campbell should be at the front of the queue in October—I think that that is the least we can do for him. I hope that he sees that the Minister understands what went wrong and is trying to address the matter as soon as possible. Yes, we will move the relevant orders in October, when the House returns from recess. The process will start in October in relation to the particular area of diabetes, and more work is required in the other areas. I hope that people understand that I need more time on the other two medical conditions.
Mr Sanders: I want the Minister to be under no misunderstanding about this. It is critical that whatever change is brought in enables people with diabetes to be confident about declaring to the licensing authority that they have the condition, because we do not know how many people there are with the condition who, fearing the loss of their licence, do not declare it.
Mike Penning:
The hon. Gentleman has touched on an important point, which is one of the reasons why I have moved as quickly as I can on this issue. I want
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members of the public, after they have been diagnosed with diabetes and start treatment, to be confident about coming forward and saying that they have been diagnosed with type 2 diabetes—or whatever the condition is—and about being assessed fairly, so that either they can carry on driving in whatever categories they are designated as being able to drive in or they understand why, at that moment, their licence needs to be revoked and withheld from them. That will happen in some cases.
I can refer to my own experience with my father-in-law; I am sure that he will not mind my doing this. He was a complete scallywag about admitting that he was a type 2 diabetic in the first place, despite what all the doctors were telling him. He said that he could address the situation through his food intake or with tablets. Eventually, we convinced him that he had to go to insulin injections. In fact, it was not me; it was his daughters who eventually convinced him. They said, “You’re going to kill yourself if you’re not careful.” At the time, his medication had not been got right to the point where he could be allowed to drive. His diabetes was not controlled, so he had regular hypos.
People need to be able to have confidence that once their condition is addressed—if it can be—the independent medical practitioner assessing them will either allow them to drive or indicate to them what levels they need to be at to get their licence back. At the moment, there is a grey area. People think, “What do I need to do? Where do I need to be? Will I ever get my licence back?” The issue of fairness is fundamental. I think that that is what the hon. Member for Caithness, Sutherland and Easter Ross, who secured the debate, was saying. I will use an old-fashioned term—natural justice. I use it as much as I can as a Minister. There is an ex-Minister in the Chamber now for the next debate. I hope that all Ministers, when they look at the effect that they are having on a constituent anywhere in the country, look at whether justice is being seen to be done.
Licences are often taken away for the right reasons. I understand why they are taken away, but I do not think that we explain particularly well either the rationale for that or the likelihood of the situation changing. As I have said, the Government will produce new proposals in October. We want there to be an open, clean discussion in which things are explained. We want people to be told, “This is where we need you to be to get your licence back. You can’t have your licence back at the moment because you haven’t reached that point.” However, there is a link between visual impairment and diabetes, so in some circumstances people would be unlikely to get their licence back. My father-in-law is now registered blind, because of his diabetes. It was not treated early enough; he admits that that was his fault and nobody else’s. As a result, he will never get his licence back. We need to be honest with people, which is where natural justice and fairness come in.
I hope that I have been open and honest. We are proceeding as fast as we can. The representative groups for the other two medical conditions will criticise us for not moving as fast on those conditions as I have just announced that we are on diabetes. That is simply because I do not yet have the evidence base behind me to be confident enough from a road safety point of view—I am thinking of the driver as well as their loved ones and other road users—to move forward. As soon as I can move on the other categories as part of the
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review and the consultation, I will do so, but I hope that in October Mr Campbell will have some control over his future income and his life.
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Public Spending (Coventry)
12.56 pm
Mr Geoffrey Robinson (Coventry North West) (Lab): I am grateful to you, Mrs Riordan, for chairing the debate and to Mr Speaker and his office for agreeing to it. It is a very important debate, in the course of which I may be joined by two other MPs. I think that both were meant to have approached the Chair to say that if time permits—I hope it does—they would like to say a few words. We will of course leave adequate time for the Minister to reply.
The occasion of the debate arises from some work done two or three months ago, shortly after the Budget came out, by my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper). She sought to show that the Budget measures, far from being progressive, as the Government had tried to imply, and far from being gender-neutral, were in fact very regressive and would impact much more severely on women than on men. The work she did initially in pursuing those points to great effect against the Government was then taken up and taken further in some excellent research work undertaken at Warwick university by two senior researchers there, Mary-Ann Stephenson and James Harrison. I am sure their work will increasingly be seen as a landmark in taking forward the points that were made by my right hon. Friend shortly after the Budget came out.
Coventry was a very suitable place to use as a test case for examination of the impact of the Budget measures on women, because in Coventry the pay gap between men and women—between the genders—is already 10 points higher than the national average. Also, as we all know, the bulk of the cuts in the immediate future must come in the public sector, and in Coventry no fewer than 78% of the city council staff are women. We can therefore measure in a very significant way, across a major part of the economy in the west midlands—the local and the regional economy—what the effect of the cuts will be. I would like to deal with each point in turn, quantifying things in so far as that is possible. We can then look forward to hearing exactly what the Minister has to say in response. But if we take the cuts as a whole, it is obvious, given that 78% of the city council staff are women, that the impact will be worst on them; they will feel it most. That is a simple fact. The cuts will disproportionately fall on women.
The child care tax credit is being cut from 80% to 70% of child care costs. Obviously, women will also suffer disproportionately as a result of that. Together with increased child care costs, that might lead to lower rates of employment for women and further increase the pay gap. That has not been quantified yet, but work is continuing. Such is the interest in the issue at the national level that when a colleague and I co-hosted a meeting to discuss it, the Members who joined us in the Committee Room came not only from the west midlands, but from all parties right across the spectrum. The room was full to capacity, and there was standing room only; it is not often that that happens in a public meeting in a Committee Room.
The second issue is housing. Single women are the main recipients of housing benefits; again, that is pretty obvious. In Coventry, about 4,360 single women and
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2,085 women in couples claim local housing allowance for private rented accommodation. LHA coverage has been cut and now applies only to the bottom 30%, rather than the bottom 50% of households. It will also be linked to the consumer prices index, rather than to local rents, which will almost certainly mean—this is why the Government have also chosen CPI for their pensions calculations—that its value will go down over time. Again, women make up by far the greatest proportion of those who take up this benefit, so they will, yet again, suffer disproportionately.
This time, we can put a figure on the cost, and perhaps the Minister can confirm or contradict my figures in her reply. In the short term, the changes will cost those who are affected in Coventry between £8 and £15 a week. If that is not right, perhaps the Minister will correct me. Again, however, those are hidden effects, and they are not spelled out in any of the Government’s background notes to the Budget or anywhere else in their calculations. Those hidden effects, which the Government have tried to cover up, are impacting directly on women in Coventry and, therefore, on their families.
On incomes and poverty, it is pretty obvious that women are poorer than men—that is a statement of fact. As I have discussed, they also get a higher percentage of their income from benefits. For example, 33,595 households in Coventry receive tax credits, and 35,000 receive out-of-work benefits. The proposed changes will, once again, impact on women. The changes include cuts to benefits to pregnant women and families with new babies, the freezing of child benefit, cuts to child care tax credits and cuts to the numbers who are eligible for tax credits. Lone parents will be required to seek work once their eldest child is just five. Those changes will have big impacts, and I will quantify them in a moment.
Disability living allowance is being cut by 20%. Someone claiming for a person who loses DLA will also lose carer’s allowance. It is a pretty heartless Government who attack the most vulnerable in our society in that way. It almost seems that the Government have zeroed in on women to prove the point made by my right hon. Friend the Member for Normanton, Pontefract and Castleford.
The benefit and tax changes in the 2010 Budget will cost women in Coventry £29 million, which is an awful lot of money. On a broad calculation, that is more than £180 per woman per year, so the Budget will have a significant impact. However, the impact on the budget of the average family and the average woman was set out nowhere in the Government’s figures. The cost to men will be half the cost to women. Again, I would be happy for the Minister to try to challenge my figures—if she can.
On education, many women have to balance a job with looking after the kids and getting them to school. Like most authorities—I do not think Coventry has been unduly affected in this respect—Coventry has had its schools grant cut. The 24% cut to the schools budget has resulted in a cut to special needs and mental health support in schools—that is where the impact will be most heavily felt. In no sense is that to be taken as a criticism of the council. Indeed, I am pleased to say that in certain parts of the report, the authors go out of
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their way to say just how responsibly the council is trying to carry through the cuts. The council appreciates that the cuts have to be made and is trying to make them in the least regressive way it can to protect children, women and other vulnerable sectors of society. It is not picking out those with special needs, and nor is it in any sense exaggerating the cuts that have to be made; it is simply making the cuts that are necessary to stay within the law.
In passing, I have heard it said—I hope the Minister can discount this at once, and she probably can—that the Government could be in breach of Equality Act 2006 and, on an individual basis, the European convention on human rights, given the effects of so much of the 2010 Budget. I am not clear whether test cases are being brought, although I did try to find out. However, it would be interesting to learn from the Minister whether any are being brought and if so, how far they have got, because some of the Government’s measures are clearly so discriminatory—as well as being at least questionable under the terms of the 2006 Act—that they could be subject to judicial review, as I hope they will be.
On violence against women, the report produced a figure that shocked everybody—from my researchers to the report’s researchers. Let me give the numbers, shocking though they are. Some 30,397 women in Coventry are likely to have been raped or sexually abused at some point in their lifetime. If we remember that there are 310,000 people in the whole of Coventry, and we divide that by half or slightly more to reflect the percentage of women in the total population, it is clear that that statistic for the likely number of women who will face some form of sexual abuse at some point in their lifetime is frightening and really rather offensive. Some 38,537 women are likely to experience some level domestic violence in their lifetime. Again, I do not think the researchers wanted to attach any undue importance to the exactitude of their estimates, but the broad measure is shocking.
The provision that was made to deal with that situation was already inadequate, although heaven knows we pushed for a higher level of support from the council and the Labour Government—I am not pretending that the Labour party did a marvellous job. There are eight specialist domestic abuse officers to deal with the situation I have described.
Mr Bob Ainsworth (Coventry North East) (Lab): I have been waiting for my hon. Friend to get on to the section of the report that deals with violence against women, because it really is most disturbing. Organisations such as the Coventry rape and sexual abuse centre are worried about funding, although the council has agreed to give it part-time funding, which is not secure. However, it is not just a matter of the sharp end of abuse against women. If women become more dependent on men as a result of the cuts, some will be inclined to stay in homes where they are potentially vulnerable and where they may be abused. That is clearly brought out in the relevant section of this first-class piece of work.
Mr Robinson: I am grateful to my right hon. Friend, who is spot on. The cuts to housing benefit will make it harder for women to move from the area to get away from their attacker. That is precisely the point made in the report, and my right hon. Friend rightly emphasised it recently in the press in Coventry.
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Mr Jim Cunningham (Coventry South) (Lab): I apologise for having been a minute or two late, although the debate might have started early. My hon. Friend and my right hon. Friend make a valuable point. For a long time, the rape crisis centre in Coventry has struggled, to say the least, to get resources, and the cuts will make the situation worse. Do the figures for women who are abused or raped in Coventry—or anywhere else for that matter—not call into question the Government’s policy on cutting legal aid and funding for citizens advice bureaux, because vulnerable people, and particularly women, will often use those agencies?
Mr Robinson: My hon. Friend is exactly right. Perhaps I may take a second to say that I think my hon. Friends want to say a word, if they are able to catch your eye, Mrs Riordan, and if we have time, about the wider aspects of the issue. After all, if more women are trapped in violent relationships there will be greater mental, physical and sexual health problems for them as a result, with an increased cost to the taxpayer. The NHS will have to cope when it is already under tremendous pressure and its budget is being dramatically cut. The issue is wider than just the reduction, although the Minister needs to explain how anyone can justify cutting the number of Coventry’s specialist domestic abuse officers from eight to two and reducing rape support resources, at the same time as other measures will clearly increase the likelihood of the problem that those staff and resources are meant to deal with. It seems crude and harsh, and we wonder whether it is strictly necessary to go along that path.
I want to mention the women’s voluntary organisations. Overall, the council, in line with other councils, faces cuts of about £38 million in its grant from central Government. A number of streams from that are for voluntary organisations, and those are due to end; some have already ended. Those voluntary organisations face increasing demand from the communities they serve, for the reasons we have been analysing. As hardship increases and cuts bite in all the areas I have mentioned, demand will increase. As resources are cut there will be greater pressures on hospital services and the police, which are also being cut. There will be a double whammy—cuts on one hand and increased need on the other.
Women’s voluntary organisations appear from the study to be particularly vulnerable, with some expecting cuts of up to 70% of their funding next year. I can inform the Minister, if she wants to deal with them individually, of the types of voluntary organisations that are particularly badly affected. Can that be looked at again? We do not expect answers to everything today, but we would like some undertaking from the Minister to check out the research funding and reconsider Government policy in the light of that. She could then tell us, “Yes, that is indeed our policy, and although we did not intend the consequences, those are the consequences and you will have to live with it.” If that is the Government’s message, they should be straightforward with the people of Coventry—the women of Coventry—and say, “This is the price that we are asking Coventry women to pay to put right the faults, and the massive irresponsible financial borrowings.” That is all, of course, in the context of reducing the deficit caused by private sector bankers.
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That seems a pretty harsh message to send to the women of Coventry, and if that is the best the Government can offer, I warn them now that the people of Coventry will not be impressed. They will in due course have occasion to express their own opinion about a Government who have been as hard-hearted and indifferent to the cause of women and children as the present Government appear to be.
Mrs Linda Riordan (in the Chair): I remind any other Member who wishes to contribute that the Minister will need time to reply, so perhaps they can keep their comments brief.
1.13 pm
Mr Bob Ainsworth (Coventry North East) (Lab): I shall keep my comments brief because the speech made by my hon. Friend the Member for Coventry North West (Mr Robinson) was very thorough and comprehensive. I want to make only one point in addition to his, and that is about funding for the Coventry rape and sexual abuse centre.
It is well known that the conviction rates for rape in this country are abysmally low. However, it has been proved beyond doubt that when an area has an appropriate service that provides support from the start, the propensity for victims to go through with an allegation, and for the conviction rate to rise considerably, is massive. We are well served by the centre in Coventry, but its funding is in crisis. It is constantly dependent on temporary funding. Despite the massive cuts that are being imposed on the council, it has agreed, for a time, to maintain some of centre’s funding on a temporary basis. However, we are really struggling to continue to provide such a vital service. Were we to lose it, the impact on women in the city would be huge.
1.15 pm
The Economic Secretary to the Treasury (Justine Greening): It is a pleasure to serve under your chairmanship, Mrs Riordan, in what we would all agree is an important debate in relation to the difficult challenges that we face. I congratulate the hon. Member for Coventry North West (Mr Robinson) on securing the debate, and I understand why he has raised the issues. In the time available, I shall do my best to respond. If I feel that I have not done so, and if there are specific points on which he would like further clarification, I may well also drop him a line.
We all understand that the backdrop to the debate is the need to get the economy and public finances back on to a sustainable footing over time. As a country, we were always going to have to do that. The hon. Gentleman, for whom I have a lot of respect, talked about the deficit being caused by the private sector. We would all accept that there has been a banking crisis, but many people also recognise that something more fundamental was going wrong with the working of our economy and public finances, and that was due to the fact that we had a structural deficit. Even in the boom times—the good times—when tax revenues were rolling into the Treasury as fast as they were ever going to, that money was still not enough to cover the country’s outgoings.
The Treasury Ministers dealing with public finances in the present Government are therefore in a position in which I assure the hon. Gentleman that we never wanted to be. We had to take the decision that it was in
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everyone’s interest to get the problem sorted out during the course of this Parliament. When we look at the problems in countries in the rest of Europe—we need only look at Greece—we see that there is still an economic crisis, and our country needs to stay out of it. Our deficit reduction plan is critical in enabling us to do that.
The hon. Gentleman raised the question of what is the fairest way to approach the situation. How can we achieve a balance between getting our public books back into order and making sure that the process is fair—that is one of the key points of the spending review and the Budget—while stimulating growth at the same time? The hon. Gentleman will be aware that one thing that we chose to do in the emergency Budget was to reduce corporation tax, and we built on that with a further cut in the most recent Budget. We tried to strike a balance between cash-flow issues—the money side—and putting ourselves in a position to ensure growth in the economy, particularly in parts of the country such as Coventry and the midlands that suffered in the recession.
Some research now shows that the west midlands in particular suffered disproportionately, and that gives us a double challenge. When I was an Opposition MP, I would have argued that, during the boom years preceding the recession, parts of the country outside the south-east did not do well enough. According to statistics, between 2002 and 2006, for every 10 jobs created in the south-east and London, just one in the private sector was created outside.
Justine Greening: I will give way in a second.
What I have described was a big problem. In addition, because of the continued hollowing-out of manufacturing in the previous decade, the west midlands suffered particularly, and I recognise that women also suffered as part of that.
I shall now give way to the hon. Gentleman, but I assure him that once he has intervened, I shall speak about some of the matters that he raised, particularly in respect of women.
Mr Robinson: I am sorry to interrupt the Minister. On this occasion, I am not going to disagree terribly about whether things are regressive, not fair or not sufficient, nor about whether they are too fast. The point here is to have a close look at the effect on women, as my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper) has stressed—the Minister herself has a keen interest in the matter. If we could consider the impact on women, I would be very grateful.
Justine Greening: We were careful in the spending review not only to consider its impact on women, but to understand its impact across the deciles. The hon. Gentleman asserts that the spending review and the Budget were regressive. However, research shows that it is the very richest people in our country who are bearing the brunt—they bear the biggest load—of tackling the deficit.
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We have tried to ensure that we provide support for women through tax measures and several of our public spending measures. The hon. Gentleman spoke about the difficult decisions that Coventry city council is having to make. He has doubtless raised the matter with local councillors and the council leader, and discussed especially whether the deficit reduction piece that has fallen on Coventry is being carried out locally in the right way to deal with the local people’s priorities.
I take seriously what the hon. Gentleman said about particular issues, such as rape and support for women. As a local constituency MP, I have taken a particular interest in ensuring that refuge and support are in place for women. Many of these women who need such support are not from my community, but come to it because they must get away from difficult situations. The hon. Gentleman was absolutely right to raise the matter.
The Government have allowed councils more freedom in how they spend their money. A lot of ring-fencing has been removed precisely to enable councils to take more locally focused decisions in these difficult times about where money goes.
The hon. Gentleman also spoke about voluntary organisations. I assure him that we are committed to supporting them—not because of the difficult spending review settlement and the difficult situation with public finances in which we find ourselves, but because it is the right thing to do. One of the less publicised parts of this year’s Budget was the big package on philanthropy and there was also a package in support of gift aid. We need to consider what can be done to help voluntary organisations. We also changed AMAPs—approved mileage allowance payments—to help voluntary organisations in terms of volunteers and passengers.
We have taken further equally important steps. For the first time, we published an overview of the impact of the spending review on groups protected by equalities legislation, including women. The increase in personal allowance will help 880,000 of the lowest-paid workers—they will stop paying tax altogether—and we know that the majority of those at the bottom end of the low-income scale are women. We are also pushing the personal allowance higher. One thing that we have in the back of our minds is the fact that many of those workers were hit by the withdrawal of the 10p tax rate. In a sense, my challenge to the hon. Gentleman is whether he was making such points when the Labour Government were withdrawing that rate, as that change affected a number of women.
We have also tried to support families. The hon. Gentleman mentioned the House of Commons Library research, and if I have time—no, I shall make time—I shall say why we do not agree with its analysis, although it clearly made an important contribution to the debate. We increased child tax credits because we were particularly concerned to ensure that we did not go backwards on child poverty, even in these challenging times. As he pointed out, the change will be important for the many women in single-family households.
As for pensioners, we have re-established the earnings link and put back the triple guarantee. We know that women are far more likely to rely on a state pension than men, and of course they are also likely to live longer, so that will help them, too. Those are the sorts
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of things that were missed in the research carried out by the right hon. Member for Normanton, Pontefract and Castleford (Yvette Cooper).
Mr Ainsworth: The Minister talks about the impact on women of the pension changes, but does she not feel that the speeding up of the equalisation will be disproportionately onerous on those women in their mid to late 50s who will have no chance of making up for the now increased burden of providing for their own pensions? Put simply, they do not have the time to improve their pension pots.
Justine Greening: I recognise the debate that is taking place about that, but I also recognise that we have to be fair to everybody, and that means ensuring not only that our state pension system is fair to women today, particularly those nearing pensionable age, but that it will be fair to women of my age and to younger generations. They deserve to know that they can rely on state pension into which they pay through national insurance and any occupational pension that they might set up. For the women of the future who are now in our primary schools, the huge problem of our deficit and the public debt needs to be sorted out so that it does not fall on their shoulders later.
I now turn to the important point of what the hon. Member for Coventry North West said about the Library analysis. As a Government, we disagree particularly with its assumptions about where benefits go and who actually benefits from them, which were understandable but not necessarily accurate. For example, the research made the broad assumption that only the person who received a welfare payment would benefit from it. The hon. Gentleman mentioned housing benefit, but that is meant to help the whole household, not just the person who receives it.
On child benefit, the research apparently showed that the spending review and the Budget hit women particularly hard. Child benefit and child tax credit—the latter went up this year and will increase again next year—are
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designed principally to help the child, and the child can be of either gender, so it is not particularly accurate to say that our approach would necessarily hit women.
I recognise the hon. Gentleman’s statistic on the proportion of lone parents who are women. However, the analysis missed out the fact that in some of the areas that we have protected, such as health, women particularly benefit. We are taking steps to improve the amount of breast screening for cancer. At the moment, the breast screening programme offers screening every three years for all women in England aged 50 and over. Women aged between 50 and 70 are invited for screening routinely, while women over the age of 70 can request free three-year screening, but we are extending that programme to include women aged 47 to 49.
Mr Robinson: We have reached the interesting part of the debate—I wish we could have got on to it earlier. The debate is obviously about Coventry, but the points being raised are of general significance—they are major policy matters throughout the country. Will the Minister tell us on which particular points the research is weak, because I do not agree that it is? Lone parents is an obvious area to consider, because they are mainly women, and the disproportionate impact on women is precisely what we are discussing. We will not have time for that today, but will the Minister reply to the point about the research?
Justine Greening: I shall write to the hon. Gentleman to elaborate on those points that I cannot answer now.
We cannot consider only one aspect of the decisions taken in the spending review and ignore the weight of the rest of those decisions. They affect not only women, but everyone. I assure the hon. Gentleman that we are committed to ensuring that the difficult decisions that we have to take—they will be difficult—are fair. We have produced more analysis with the emergency Budget, the spending review and this year’s Budget to help people to understand how those decisions fall across our communities, and I hope that that is helpful to the hon. Gentleman.
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Benefits (EU Nationals)
1.30 pm
Mrs Anne Main (St Albans) (Con): It is delightful to serve under your chairmanship this afternoon, Mrs Riordan. This is an important debate. I have a brief time in which to speak—I wish that it were longer—but I will allow my colleagues to make brief interventions, if they need to make a particular point.
Can British taxpayers, with a massive budget deficit of £143.2 billion, afford to be so generous with their benefits payment system to everyone who tries to claim? Are we the benefit pot for the EU or the UK? Do we, through our lax approach, encourage benefit tourism?
Under EU rules governing non-discrimination against other EU member citizens, many of our benefits are ultimately available to many of the citizens who have decided to join us from other EU member states with only a few exceptions for some accession countries. The amount of benefits being paid has risen enormously, and our own Chancellor, in his spending review, is looking at ways in which to bring down the welfare bill. I suggest that we start with EU benefit tourists and by closing some of the loopholes that have been exploited by the canny.
My colleagues will not be surprised to hear that I am no fan of the bloated, greedy, meddling Euro-state. I did not vote for it, and the power-creep that has gone on over the years is abhorrent to many older citizens who voted for a common market based on trade. In 2004, 10 countries joined the EU, and their citizens are afforded the same rights as those of other EU member states. Transitional measures for up to seven years restricted the right of freedom of movement for labour for eight of the 10 new accession states. Often called the A8 countries, they are the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia and Slovenia. Ireland, Sweden and the UK were the only EU member states to grant full labour market access to the A8 nationals. Other member states maintained their existing work permit arrangements or implemented a modified work permit regime.
At that time, we foolishly implemented a transitional set of arrangements covering a workers’ registration scheme. These arrangements have lapsed for the A8 group as of this year. That category of EU migrant worker will be able to claim jobseekers’ allowance, council tax benefit and housing benefit on top of other benefits such as child benefit. If the Migration Advisory Committee’s report of 2009 is anything to go by, we can expect an even greater call on our benefits now that the transitional arrangements have lapsed. The MAC report looked into extending the transitional arrangements for EU migrant workers until April 2011.
In 2008, the MAC reviewed the evidence on drivers for migration. Relative income levels—GDP per capita expressed in purchasing power standard—in A8 countries demonstrated the strongest relationship to immigration rates. We must learn from history. If there is a direct link, as outlined by the MAC in 2009, that people from poorer countries are more likely to come to work and claim benefits in Britain, then we must expect that when the current transitional arrangements for Bulgaria and Romania lapse this year, or in 2013 if we achieve an extension, many thousands of them will come over, too.
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We cannot walk into a potentially burgeoning welfare commitment with our eyes closed, and we must act to protect our public finances. We cannot castigate the previous Labour Government for massively underestimating the number of Polish migrant workers who would come to the UK and then put the blinkers on our own eyes when it comes to the A2 countries.
The MAC report showed that, relative to other A8 countries, Poland had a much lower GDP per capita than Britain, and so many Poles came to the UK to seek work. As the right hon. Member for Birkenhead (Mr Field), in his capacity as poverty tsar, has been advising the Government, it is no secret that nearly 90% of the newly created jobs have been filled by migrant workers, many of whom have dependent families back home. With an even worse GDP per capita for both Bulgaria and Romania, we must expect them to react to their circumstances in the same way and to seek a more affluent lifestyle on our doorstep.
We should have learned a lot from the failure of the previous Government to protect the coffers of the UK from EU migrants seeking, very understandably, to better their economic lot and that of their families, many of whom will have stayed behind in their mother country. I do not blame them; they are simply working within a set of rules that we have stupidly put in place.
Mr Andrew Smith (Oxford East) (Lab): This is an important subject, and I congratulate the hon. Lady on securing the debate. Does she not accept that in judging this in the round, we also have to take into account the benefits to our economy and to other economies of freedom of movement? Should we also not take account of the benefits that accrue to British citizens through having rights of movement to other EU countries?
Mrs Main: There are undoubtedly benefits, but we are talking about countries with different levels of affluence. Although we benefit from some hardworking migrants, we also have to open up our benefit pot. It is no good expecting our country to withstand massive cuts in benefits and services to try to tackle a budget deficit while, at the same time, handing out largesse elsewhere. I want to examine those failures and learn from them, especially as Romania and Bulgaria will soon enjoy full accession rights.
There is no point in any of us wringing our hands, berating the shortcomings of the previous Government and moaning that our hard-earned taxes are being sent abroad if we are not prepared to tackle this. I urge the Minister to take note and, hopefully, take action.
Child benefit is a notable example that has caught the eye of hon. Members in all parts of the House. I pay particular tribute to my hon. Friend the Member for Witham (Priti Patel) for her sterling work in uncovering recent data that show how our child benefit is being transferred by EU migrants and their families.
In 2007, the Secretary of State for Transport, my right hon. Friend the Member for Runnymede and Weybridge (Mr Hammond), who was then shadow Treasury spokesperson, said:
“There are 200,000 more British children living in poverty than a year ago. Child benefit is a vital weapon in the fight against child poverty. So why is Gordon Brown sending thousands of pounds of benefits every week to children who do not live here and who may never have even visited the UK.”
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I totally agree, so why are we still doing it and why will we keep on doing it in ever greater amounts when the new A2 countries will equally want a slice of our benefit pie? We cannot just hope that other countries may not know about the apparent advantages of seeking benefits in our country.
At the time my right hon. Friend made his comments, the biggest Polish newspaper in Britain, The Polish Express, ran a story headlined “Benefit Hunters”, which claimed:
“The longer we are in Britain, the more rights to social security we are given and the better we are taking advantage of them.”
It gave advice on how to claim and described the case of one Polish migrant who was given a two-bedroom house shortly after applying to a housing association without any need to join a waiting list. The paper said:
“The formalities concerning an application for social security are extremely simple. Do not delay in submitting an application.”
Sarah Newton (Truro and Falmouth) (Con): Does my hon. Friend agree that the NHS should also do more to reclaim the costs of treating EU nationals? Those costs can be a very great burden on hospitals such as mine in Treliske.
Mrs Main: My hon. Friend makes a valid point. I will touch only on some of the benefits, but the actual list is almost endless. We cannot delude ourselves and think that people will not know about the loopholes or the benefit pots. According to Martin Beckford and Matthew Day, writing in The Daily Telegraph in November 2008, jobcentre staff in Poland encouraged returning migrants in Poland to continue to claim jobseeker's allowance from Britain, rather than sign on for Polish unemployment benefit, which pays much lower amounts. A quick trawl on the internet shows how EU migrants can get a myriad of advice on how to claim a range of our benefits. We must be under no illusions. We are seen as a soft touch, and we will be exploited by those who have the full might of EU law behind them.
Perversely, we are expecting our own citizens to bite the bullet on cuts in order to help slash the massive budget deficit, yet at the same time we are widening the pool of foreign EU families who are eligible to make a claim from the UK benefit pot. What we save in one corner we pay out in another. Benefit payments to newcomers from eastern Europe and other parts of the EU are not specifically recorded by the Department for Work and Pensions, but unofficial estimates put the bill at a very conservative £200 million a year—that probably does not include the NHS—and growing. Teasing out firm data on this has been difficult. In a series of questions, I have been told by the DWP that the data are not recorded or are not available due to cost. However, I was pleased to be assured by the Secretary of State for Work and Pensions on 20 June that he has commissioned his officials to look at alternative ways of making the information available.
The child benefit bombshell has been widely covered in the media from The
Daily
Telegraph to the tabloids. I find it hard to look ordinary middle-class families in the eye, particularly families with a mum who stays at home, and say, “Apparently, you are so wealthy with one of you earning just more than £44,000, you must give up your child benefit so that a family in Poland, and ultimately Bulgaria, Romania or wherever within
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the EU, can claim it for children who do not even live here.” They are furious and so am I. It is estimated that 1.2 million British families will lose out under the new benefit rules. I am not happy that we are looking at this issue in this way.
Although in theory there is reciprocation, other EU countries have far lower benefit rates, and many EU countries also have tougher qualification rules. All those EU countries have some form of family allowance. If children qualify for benefits in their own country, why should our taxpayers be expected to support them? If we could afford it, I would rather that every family in Britain had child benefit as a right that was not means-tested—as used to be the case—instead of rationing it, especially since it now appears that any money that is saved is then swallowed up in our burgeoning welfare bill, which must include payments for EU children and families who do not even live here. If we are expected to make cuts, I want to cut back on this scam, which takes the UK taxpayer for a fool.
Mr Philip Hollobone (Kettering) (Con): I congratulate my hon. Friend on her excellent speech. I do not believe in the free movement of labour across the EU. However, if we are to have this system and if we are to have reciprocity between nations, would it not make sense that, when someone moves from Poland to this country, they should be entitled to receive the same child benefit that they would get in Poland? In other words, they should receive the rate of benefit that they would receive in their home country. That way, we would have reciprocity across the EU, but we would not have to shell out billions to other EU nationals.
Mrs Main: My hon. Friend has anticipated my next point, but I think that he will be shocked at what he will hear. The figures speak for themselves. I have taken the case of one three-year-old child, because I know that there are various rules and regulations, depending on whether a child has a disability and so on. In the UK, child benefit for one three-year-old child is £87.97; in Poland, it is £14.99; in Bulgaria, it is £15.87; and in Romania, it is £8.67. Those are the equivalent figures for euros at today’s rate. We should ask ourselves, “If you could claim at a higher UK level, why wouldn’t you?”
Hon. Members might be surprised to learn that we are not only paying child benefit here, at our rate, if an EU worker is eligible to claim it, but apparently we are also topping up dependants in countries whose largesse does not meet the standards of our own largesse. We should be asking ourselves, “Why are we paying top-ups to less generous countries where the level of child benefit has obviously been set at one that the country deems acceptable?” When conducting research for this debate, I was staggered to be told only yesterday by the international child benefit team, which is part of Her Majesty’s Revenue and Customs, that the rules allow for top-ups to be claimed to top up lower rates elsewhere. So, when one EU migrant worker is in the UK with a spouse working in their country of origin, such as Poland, and with their children receiving that country’s child benefit, we will top it up to the level of UK child benefit. That is madness.
Loopholes exist in the current benefits system to such an extent that EU migrants can always find a way
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around the system, if they are resourceful. As has been reported widely in the
Daily Express
and other newspapers, by declaring themselves self-employed Bulgarians and Romanians get around our weak transitional arrangements on restricting access to the labour market simply by selling
The Big Issue
and paying a nominal contribution of £2.50 in national insurance per week, which then opens up a lucrative stream of other benefits. The TaxPayers Alliance has described that system as a scam, and it is right to do so. We are the politicians; what are we going to do about this situation? It is a ridiculous state of affairs that I believe will foster social unrest, discrimination and most importantly resentment.
I know that fairness works both ways. The fact that so many newspaper editorials are addressing this thorny issue shows the depth of public concern, and I pay tribute to those newspapers and urge them to keep up the pressure. With their help, we can hopefully give Britain a strong voice when we stand up to this nonsense.
Let us not forget that we have the poor, the young and the elderly living in increasing poverty in our own country. According to the Poverty Site, some 13.5 million people in the UK—around a fifth of the population—exist on or below the poverty line, and yet we are rationing money to send it to even poorer citizens elsewhere in the EU. Sadly, poverty is always relative, and so our citizens will lose out.
A staggering case of opportunistic lifestyle enhancement was recently reported in The Economist under the headline, “Keeping the coffers shut”. The Economist reported how Galina Patmalniece came to Britain after 40 years working in Latvia’s factories and kitchens with only her Latvian state pension to support her, which was as little as £50 a month. She applied in the UK for a means-tested pension top-up of £133 for a single person. She was denied that top-up, but meanwhile she got council housing. To cut a long story short, she appealed to the Court of Appeal, which said that the Government were entitled to withhold benefit. The basic issue at stake was whether the conditions that Britain imposes for giving out pensions were compatible with the rule of EU law, which prevents discrimination on grounds of nationality. Broadly speaking, an EU national must be able to support themselves, so with no family or work and only her Latvian pension to support her, Ms Patmalniece had no right to reside here, although we made no effort to deport her. It is a common theme that Britain does not remove EU migrants who cannot support themselves, even though we are allowed to do so.
On 8 March this year, the Supreme Court found in the case of Ms Patmalniece that the British requirements amounted only to indirect discrimination. A majority of the Supreme Court judges agreed that our approach was reasonable. However, the European Commission might decide that it wishes to challenge that ruling and bring an infringement action against Britain in the European Court of Justice. The Commission has already written to our Government expressing unhappiness about our approach in this case as well as about other restrictions on the access of EU nationals to benefits. I believe that that letter has been described as being of quite a threatening nature. Will the Minister update us on that case? I
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believe that Britain will be firmly behind him in resisting dishing out benefit payments to EU migrants such as Ms Patmalniece.
I am sure that my constituents and hon. Members here in Westminster Hall today have read with interest articles in the Daily Mail and other newspapers covering the Dutch approach to pulling up the drawbridge on workless and benefit migrants amid angry allegations that labour migrants in the Netherlands are abusing the benefits system. In many countries, there is a rising tide of disquiet over EU migrant tourism. I hope that the Minister takes note and joins Holland in saying no to this sloppy and misplaced altruism. If that sentiment catches on across Europe, perhaps a bit of collective common sense will prevail.
Our national autonomy is being eroded by the EU, which must stop. There is an old adage that good fences make for good neighbours. How much more important is it for us to reclaim our boundaries and our borders? Tackling this benefits time bomb must now be a priority for the Government. There is no Government money, only taxpayers’ money, so give us back our say over how we spend taxpayers’ money, whom we can help and how we can do it. I am sick of having to find wriggle room within regulations that we find incomprehensible and that disadvantage ordinary hard-working families in the UK, who pay their taxes to fund services in this country and not to dish out benefits to some cash-strapped EU member country that has its hand out.
I know that I have given the Minister a lot to think about today and I am happy for him to write to me about any of the issues that I have raised. However, I want to hear that the Government are stiffening their resolve to tackle this problem, which I believe will only get worse and worse.
1.46 pm
The Minister of State, Department for Work and Pensions (Steve Webb): I congratulate the hon. Member for St Albans (Mrs Main) on securing this debate on what she rightly says is an important issue, which I know is of concern to the Minister of State, Department for Work and Pensions, my right hon. Friend the Member for Epsom and Ewell (Chris Grayling). He has responsibility for employment issues and ordinarily, he would have responded to this debate, but unfortunately he is unable to do so. As I shall explain, he is already taking steps to address some of the issues the hon. Lady raised today. As she knows, as things stand the Department for Work and Pensions’ benefit payment systems do not record the nationality of people receiving benefits. The reason for that is that nationality per se is not a condition of entitlement, and the system records conditions of entitlement such as being available for and actively seeking work, in the case of jobseeker’s allowance, or meeting contribution conditions for contributory benefits such as the state pension. So a person’s nationality is not, of itself, an entitlement condition.
The hon. Lady gave a figure—I think it was £200 million —but the truth is that we do not know what the figure is, which is a matter of concern. I assure her that Ministers are concerned about the lack of data, and we know that other Members share that concern. We consider it right that we should know the extent to which people from other countries are claiming benefits in the UK. I am
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therefore sure she will be pleased that the Minister with responsibility for employment announced at oral questions last month that he has commissioned work to find means of making information available about the nationality of benefit claimants. That information would help to inform debate on this subject.
To provide some context, I will discuss immigration more generally. The right hon. Member for Oxford East (Mr Smith), who is himself a former Secretary of State for Work and Pensions, talked about the positive impact that inward migrants can have. We fully recognise that positive impact, and we will continue to encourage the brightest and the best to come to the UK to promote growth and enterprise here. However, we will reduce the degree to which we currently rely on migrant workers through a radical shake-up of the welfare system and by improving the skills of the British work force. Our goal as a Department is to ensure that people are better prepared, have more incentive and face more requirements to take up work in the UK, which will mean that demand for migrant workers can be reduced. Clearly, although immigration has enriched our culture and strengthened our economy, it must be properly managed.
Mrs Main: The Minister is making a valid point. However, when I looked at the statistics on this issue, I was shocked to realise that some of these migrant workers are hugely overqualified for the jobs they come here to do. I am not disputing that we are attracting well qualified people, but they are not qualified to do the jobs they are doing; if anything, they are overqualified for them. We have a problem, in that we have a dearth of people who want to do those low-skilled jobs, so we have qualified people coming in to do them. That is the problem and I do not see how we will solve it.
Steve Webb: No, I do not see how we can solve that, in the sense that, if we have a single labour market we cannot constrain individuals who bring particular skills and prevent them from doing jobs that are, as it were, less demanding than the skills they bring in. That is correct.
The hon. Lady raised the question of benefits claimed by the nationals of other EU member states working in the UK. I shall explain what they are. In preparing for the debate, I had to find out how the system works and was surprised by some of what I learned.
Under the freedom of movement rules, as we have just heard, many UK nationals are living and working in other EU countries and have reciprocal rights. Free movement of persons is fundamental to Community law; indeed, it is an essential element of European citizenship. However, the rights are not unlimited. Those who wish to live in the UK for longer than three months must be exercising a treaty right as a worker, a workseeker, a self-employed person, someone of their own means and self-sufficient, or a student. If EU citizens do not meet one of those requirements, they will not have a right to reside in the UK, and may be liable to removal. The Government are clear that EU citizens who benefit from the right to free movement must adhere to the responsibilities it brings and abide by our laws.
Mrs Main:
The problem is that that list covers just about everything. As I have said, anybody who cannot do a particular thing can declare themselves self-employed
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by doing a menial job such as selling
The
Big Issue
or another such publication. That is the problem: the list does not seem to prohibit anybody.
Steve Webb: When I looked at the list I wondered whether someone could say, “Oh, I am looking for a job.” That is not sufficient. The definition of a workseeker would be similar to the requirements placed on someone claiming jobseeker’s allowance, for example. I take the hon. Lady’s point that there may be loopholes that need to be looked at. However, if someone says they have come here to look for a job, it not enough merely to assert it; they have to provide evidence that they are actively doing so. Let me now make a bit of progress, as I am keen to respond to the points the hon. Lady has raised.
The failure of past policies has left many people continuously on out-of-work benefits for more than a decade, 90% of them on incapacity benefits. Many of our fellow citizens want to work but have not been provided with the help and support they need. The crucial point is that one reason why employers take on EU migrants is that many of our fellow citizens have not been effective participants in the labour market. The Secretary of State is determined to change that through the Work programme and universal credit, to try to ensure that when employers are looking at a list of potential employees, the UK citizen—the domestic worker—is a credible alternative to the EU migrant. We believe that the success of those policies will reduce the demand for EU migrants in the situation described by the hon. Lady.
On access to benefits, EU nationals have rights under the European treaties to enter and remain in the UK, including the right to seek and take up work. Where EU nationals are here in exercise of a treaty right, the UK, through its obligations under both European and international law, allows them access to income-related benefits. As the hon. Lady says, EU nationals who are working here have access to in-work benefits, such as housing benefit, council tax benefit and child tax credits. If they are unemployed and looking for employment, they may also claim income-based jobseeker’s allowance. There will, however, be some who have no intention of seeking work—benefit tourists, as the hon. Lady says—and they may try to access benefits. We do not believe, on the whole, that that is the main reason why people come here, but we accept it is a danger and it is one of our concerns.
That is why we have rules in place to prevent the abuse of the benefits system and benefit tourism. The principal measure is the habitual residence test, which ensures that income-related benefits are paid to people with reasonably close ties to the UK and who intend to settle here. Its underlying principle is that the taxpayer should not have to subsidise people with very tenuous links to this country.
Mrs Main: Will the Minister give way?
Steve Webb: Will the hon. Lady allow me to make a bit more progress, as she has raised a lot of points and I have got only seven minutes to respond?
To be eligible for an income-related benefit of the sort listed, claimants must satisfy the two-part habitual residence test—I may be coming to the point the hon.
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Lady was going to raise. That requires the individual first to demonstrate that they have a right to reside here and, secondly, to show that they are habitually resident. Anyone who does not have a right to reside is not habitually resident, and is not entitled to any income-related benefits.
To clarify, the term “habitual residence” is not defined specifically in UK social security legislation. To determine actual habitual residence, decision makers look at a range of things that we think should rightly be taken into account, such as whether the person is returning to resume past habitual residence; attachment to and intentions in the UK; reasons for coming; employment record; and length and continuity of residence in another country. The information is gathered by interviewing the claimant, and decision makers must be satisfied on objective grounds that a person who claims income-related benefits after arriving in the country has genuinely adopted the UK as his or her place of habitual residence.
Mrs Main: I have had all that information from a series of questions I have tabled. I was shocked to realise that people need to be resident for only a month or possibly even less, which is open to interpretation by the individual doing the interview. That is a very low bar.
Steve Webb: Although the hon. Lady is right to say that a month enables someone to be considered, I have listed the criteria that the decision makers have to apply, and I suspect a lot of those would be hard to satisfy after a month. So, although that is technically true, I suspect that in many cases people have been here for a lot longer.
Child benefit, which has been mentioned, is clearly quite cyclical in terms of foreign nationals coming to the UK. The hon. Lady was right to praise the hon. Member for Witham (Priti Patel), who established through a written question that the number of families getting child benefit for children in Poland was, in October 2009, just under 23,000. However, the answer to that question showed that that figure fell to 17,000 in July 2010. I can provide an update today—the figure fell again to just over 16,000 in June 2011. There has been a 29% fall in the number of Polish people working here and claiming child benefit for children at home. I am sure the hon. Member for St Albans would say that that is 16,000 too many.
However, it is worth stressing that such situations are not static. They change, and in this case there has been a fall of more than a quarter. The reason for the payment is that it is only made in respect of UK national insurance contributions. That is an important part of the mix. We are paying the benefit to somebody who is putting money into the UK Exchequer through national insurance. We have a legal duty to pay at the higher rate. In his intervention, the hon. Member for Kettering (Mr Hollobone) asked whether we should pay at the Polish, rather than the British rate. The courts have determined that we have to pay at the higher rate. The logic is that the entitlement is based on UK national insurance contributions, which will be based on UK
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wages and taxes. Therefore, the parallel entitlement is to a UK benefit. I understand the emotional reaction that we probably all have when we hear that.
In the few minutes remaining I should move on to the question of EU citizenship and access to benefits—what is called benefit exportability. Since the UK joined the EEC in 1973, it has been part of the system for co-ordinating social security for people who move between member states. The rules protect UK citizens abroad as well as EU citizens who come to the UK. Every EU member state has exclusive responsibility for organising and financing its national social security schemes, and for setting out the conditions governing entitlement, provided that they comply with the principles of equal treatment and non-discrimination on grounds of nationality. However, there are EU regulations on the co-ordination of social security to ensure that, where someone has earned an entitlement, they do not lose it because they have moved between member states. That is to remove one of the barriers to the free movement of workers, which is one of the basic tenets of the EU’s internal market.
The rules set out under what circumstances a person retains, or can claim, social security benefits when they move between member states. In particular, the rules protect workers who live in one member state and work in another. On the question of adding things together, people coming into the UK may be entitled to benefits on the basis of their social insurance payments in another member state; and people going from the UK can be entitled to benefits in another member state on the basis of their UK national insurance. That is known as aggregation—where a person’s contributions are added together to give them entitlement. The country that pays, however, is still usually the country where the person is working or last worked. Again, that makes the point that the payment that is made is not necessarily something for nothing; it may well be something for something. In the case of a British worker, the contribution may have been made in the UK before they left, or, in the case of a foreign worker, in their home country before they came here. There is a reciprocal arrangement.
I turn to the question of topping up child benefit and child tax credits paid, for example, in Poland. Let us take the example of a family in which dad is in the UK and mum is at home with the children. If dad is paying national insurance and mum is at home, we would pay full UK child benefit to the family, in return for his national insurance. That is what he is paying for. However, if mum was working and therefore earning some Polish benefits, we would top up. Funnily enough, although people say it is strange that we are topping up Polish benefits, when we do so we are paying less money than when we are not topping up but paying the full amount.
These are clearly complex and difficult issues. Once there is a single labour market with free movement, a lot of things follow that are difficult to disentangle. However, I can reassure the hon. Lady that the Minister of State, Department for Work and Pensions, my right hon. Friend the Member for Epsom and Ewell is seized of the importance of the issues and, I hope, will be able to make progress on them in due course.