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House of Commons

Tuesday 31 January 2012

The House met at half-past Two o’clock


[Mr Speaker in the Chair]

Business Before Questions

London Local Authorities Bill [Lords] (By Order)

Further consideration of Bill, as amended, opposed and deferred until Tuesday 7 February (Standing Order No. 20).

London Local Authorities and Transport for London (No. 2) Bill [Lords] (By Order )

Transport for London (Supplemental Toll Provisions) Bill [Lords] (By Order )

Second Readings opposed and deferred until Tuesday 7 February (Standing Order No. 20).

Oral Answers to Questions


The Secretary of State was asked—

Community Projects (Kettering)

1. Mr Philip Hollobone (Kettering) (Con): How many offenders served part or all of their sentence working on community projects in Kettering constituency in 2011; and for which organisations work was carried out. [92471]

The Minister for Policing and Criminal Justice (Nick Herbert): Four hundred and five offenders completed all or some of their compulsory unpaid work or community payback in Kettering last year. Twelve organisations benefited, including the local wildlife trust, St Mary’s church, Mind and the British Heart Foundation.

Mr Hollobone: It is clearly beneficial for offenders and the local community for offenders to do constructive work in the community, but will my right hon. Friend agree to visit Kettering with me to see some of those offenders in action so that we can really see whether they are putting their backs to the wheel and doing this work properly?

Nick Herbert: I am happy to accept my hon. Friend’s invitation to visit Kettering and to see a scheme with him. It is important that community sentences are punitive and that they are properly enforced. We are increasing the maximum length of curfew requirements and making community payback more rigorous and

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demanding. We want to go further by seeing a clear punitive element in every sentence, and we are consulting about that.

Several hon. Members rose

Mr Speaker: Order. This question is about Kettering, from which Carshalton and Wallington and Manchester are a long way away.

Law Centres

2. Lilian Greenwood (Nottingham South) (Lab): What steps he plans to take to support law centres. [92472]

The Parliamentary Under-Secretary of State for Justice (Mr Jonathan Djanogly): The Ministry of Justice does not provide direct support for law centres. However, law centres are able to bid for contracts issued by the Legal Services Commission to provide legal services in specified areas of law and will continue to be able to do so in the future.

My Department is also working closely with the Cabinet Office to support the cross-Government review into the funding of the not-for-profit sector announced on 21 November last year.

Lilian Greenwood: I thank the Minister for that reply, but what would he say to my local law centre in Nottingham, which, as a result of his legal aid changes, says it will no longer be able to offer specialist advice to people experiencing problems at work, with debts or with benefits? When our local citizens advice bureau is already hugely overstretched, does that not mean that hundreds of people—particularly vulnerable people—will be unable to get the advice they need and will be denied access to justice?

Mr Djanogly: Specifically, legal aid will be provided for a lot of debt advice after our changes. We are reducing our spend on legal aid, and law centres will be affected by that, but the Government recognise and highly value the important role of not-for-profit organisations such as law centres. That is why we launched a £107 million transition fund last year and the £20 million advice services fund this year. It is why the Cabinet Office has also announced a review of not-for-profit advice centres, which is a welcome and important development.

Sir Alan Beith (Berwick-upon-Tweed) (LD): Is it not an assumption behind the Government’s reforms that the availability of advice needs to replace a great deal of litigation? If that is to be achieved, is it not necessary to ensure that there is a long-term, not merely a short-term, solution to some of the funding problems of law centres and citizens advice bureaux?

Mr Djanogly: My right hon. Friend makes an important point. We are changing the way funding works and looking for alternatives to be taken up. However, we appreciate that, in the meantime, while the reorganisations are happening, there is a need to support law centres, which is why we are looking at transitional provisions to ease that passage.

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Mr Andy Slaughter (Hammersmith) (Lab): Writing in yesterday’s Daily Mail, Matthew Elliott, the chief executive of the TaxPayers Alliance, pointed out that:

“advice costing £80 to deal with a housing problem can save thousands for councils who are legally required to house homeless families…cutting £10.5m for legal aid in clinical negligence cases will cause knock-on costs to the NHS of £28.5m.”

He says:

“Almost everyone who has looked at these particular cuts”—

even Norman Tebbit—

“thinks that too many of them will end up costing taxpayers more than they save.”

Is he right?

Mr Djanogly: No, he is not right. The figures have been repeated by the Law Society. The point is that legal help is not the same as legal aid. We certainly appreciate the strong need for legal help so that problems can be dealt with early, and that is why we are very supportive of not-for-profit organisations.

European Court of Human Rights

3. Stephen Phillips (Sleaford and North Hykeham) (Con): What steps he is taking to promote reform of the European Court of Human Rights. [92474]

The Lord Chancellor and Secretary of State for Justice (Mr Kenneth Clarke): The United Kingdom has made reform of the Court the top priority for our current chairmanship of the Council of Europe. Our aim is to secure agreement on a package of reform measures. We have been talking to many member states and to key figures in the Court and the Council of Europe, and we are reasonably confident that we can gain agreement.

Stephen Phillips: I am extremely grateful to my right hon. and learned Friend for that answer. He will have seen that the Prime Minister rightly condemned the Court’s decision effectively blocking the deportation of Abu Qatada despite the assurances that the United Kingdom obtained from Jordan. How long does he expect this reform process to take, and what steps are being taken now to ensure that the Court does not torpedo decisions of the UK courts in a way that undermines rather than supports human rights?

Mr Clarke: My hon. and learned Friend is at least as good a lawyer as I am—and practised more recently too—and will know that cases are often more complicated than they appear. We actually won the Abu Qatada case on the question of the assurances that we got about his possible torture. Irritatingly, we then lost it on a separate issue about whether prosecution evidence against him had been obtained by torture. Obviously, the Government, led by the Home Secretary and advised by the Attorney-General, are considering what to do next to take the case further. The reform does not turn on one case. However, one of the key reforms that we are urging is that the Strasbourg Court should not just be regarded as a court of appeal after the full process has been gone through in this country’s courts and issues of human rights have been properly considered. The issue that my hon. Friend raises is at the heart of the case that we are arguing with our colleagues in the Council of Europe.

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Jeremy Corbyn (Islington North) (Lab): Does the Justice Secretary agree that much of the media speculation and attacks on the European Court of Human Rights are damaging to the interests of many people all over Europe who are suffering serious human rights abuses? This country, which prides itself on having a Human Rights Act, should support the European convention and the Court, and recognise that it is in everybody’s interest that we protect human rights in this country, as well as in Hungary, Russia or wherever else they are under threat.

Mr Clarke: This country is a great advocate of human rights throughout the world, and should continue to be so. The Prime Minister, the Foreign Secretary and I have confirmed in recent speeches at Strasbourg our commitment to the European convention on human rights and our desire to see human rights maintained all the way from this country to the Russian Federation, which is the furthest-east member. However, we seek to strengthen the Court by making it operate properly. It should concentrate on the important cases and those that raise serious issues of principle obtaining to the convention. At the moment, it has 150,000 cases in arrears. It takes years to get them heard, and it sometimes gives judgments despite the whole issue having been properly considered by national institutions and national courts.

Mr Christopher Chope (Christchurch) (Con): Will my right hon. and learned Friend be visiting judges in the European Court of Human Rights to explain the agenda for the British chairmanship of the Council of Europe? When our right hon. Friend the Prime Minister visited Strasbourg—very successfully—last Wednesday and gave a brilliant speech, delegates expressed concern that he did not have time to visit the Court itself.

Mr Clarke: First, I am delighted that my hon. Friend and I agree that the Prime Minister gave a brilliant speech in Strasbourg last week. It went down very well there. Yes, I meet judges. As I mentioned in an earlier answer, I hold discussions with judges. There is widespread acceptance in Strasbourg of the need for reform, so long as people are satisfied that we will continue to uphold the convention and we regard the Court as the right forum in which to consider serious issues of principle in all 47 member states. I am sorry that my right hon. Friend the Prime Minister was unable to meet judges, but I am sure that I can facilitate the opportunity for him to do so, if he or the judges wish it. However, the Foreign Secretary, the Attorney-General and I are in touch with the judges and our opposite numbers in all the relevant countries.

Sadiq Khan (Tooting) (Lab): May I ask the Justice Secretary for a short answer to a straightforward question? Does he share the apparent view of the Prime Minister and many of his Back Benchers that if the Government cannot persuade the other 46 Council of Europe members to reform the European Court of Human Rights, as set out last week, the UK should withdraw from the European convention on human rights?

Mr Clarke: The Prime Minister has never expressed that view to me or publicly, so far as I am aware, and if he did, I would not agree with it.

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Foreign National Prisoners

4. Mr John Spellar (Warley) (Lab): What steps he is taking to transfer more foreign national prisoners to their home countries. [92475]

The Parliamentary Under-Secretary of State for Justice (Mr Crispin Blunt): The Government are committed to removing more foreign national offenders at the earliest opportunity. Last week I met the European Union Commission, and the Justice Secretary met European Union Justice Ministers, to impress upon them the importance of member states implementing the new European Union prisoner transfer agreement promptly. We continue to negotiate prisoner transfer agreements with countries outside the European Union. We are also examining our offender management processes here in the United Kingdom, which will help to identify how more foreign national offenders can be transferred to their home countries.

Mr Spellar: Is not the reality that the number of foreign prisoners being removed is actually dropping, and that although we signed an agreement with Jamaica in 2007, Jamaica has still not got round to ratifying and acting on it? When is the Minister going to get a grip of the situation?

Mr Blunt: I regret that we are having to deal with the inheritance of the legal instruments that were negotiated and presented to us by the last Administration. The Jamaican prisoner transfer agreement is an example of that. Even if the Jamaican Parliament passed the legislation to implement and ratify that agreement—which is beyond the control of this Government, I might gently point out—it would still require the consent of the Jamaican prisoners in our prisons to go home under that agreement. That would not be forthcoming, so we need a rather more effective piece of negotiation, which is all part of the strategy that we are putting in place with the 20 countries from which the largest number of foreign national offenders in our prisons originate, to get some proper, joined-up governmental attention on this issue.

Tony Baldry (Banbury) (Con): When the sentencing judge orders an individual to be deported, why can that judge not make a finding of fact as to their nationality, so that, as of that moment, the Home Office and the Ministry of Justice can make it clear to the high commission or embassy concerned that that prisoner will be returned to that country at the conclusion of their sentence?

Mr Blunt: I am extremely grateful to my hon. Friend for that suggestion, which is certainly one that I will be taking up in our ongoing examination and review, so that we improve the current, unsatisfactory state of affairs with foreign national offenders as quickly as we legally can.

Sadiq Khan (Tooting) (Lab): May I remind the Minister that it was the last, Labour Government who negotiated the groundbreaking EU prisoner transfer agreement, which came into force last December, to transfer foreign European prisoners back to their countries during their sentence? We have had lots of tough talk from the

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Minister and the Government, but what progress have the Government made on ensuring that the EU agreement is implemented across all EU states?

Mr Blunt: One of the reasons why I was visiting the European Union Commission on Friday and speaking to the official responsible for implementation of the agreement was to help deliver that. It is just a slight pity that in the negotiations undertaken by the last Administration, they managed to give Poland a five-year delay and Ireland a complete opt-out.

Dr Andrew Murrison (South West Wiltshire) (Con): In designing prisoner transfer agreements, will the Minister ensure that the legitimate expectations of the victims of crime in this country are satisfied? Too often we find them fearful that their natural desire for retributive justice is going unfulfilled.

Mr Blunt: That is an important part of any consideration about the transfer of prisoners, and one that I certainly give attention to in considering applications that are made to me.

Keith Vaz (Leicester East) (Lab): As the hon. Member for Banbury (Tony Baldry) said, the process for removal should begin at the time of sentence. That was one of the recommendations of the Select Committee on Home Affairs in our last report. At the moment, the whole process starts far too late. We need better liaison between the UK Border Agency and the prison authorities.

Mr Blunt: I am grateful to the right hon. Gentleman and to his Select Committee for its work in this area. He will know just how multi-faceted this all is, and I am grateful for the continuing attention of his Committee. The points he makes are entirely reasonable and I will be following them up.

Free Legal Advice

5. Stephen Timms (East Ham) (Lab): What assessment he has made of the availability of free legal advice. [92476]

The Parliamentary Under-Secretary of State for Justice (Mr Jonathan Djanogly): The Ministry of Justice is responsible for legally-aided advice services through its relationship with the Legal Services Commission. This is publicly funded legal advice, rather than “free” legal advice. “Free”, or pro bono, legal advice is not within the scope of the Ministry’s ambit. Legally aided lawyers do not act for free; they act for money and are paid for by the taxpayer, so it is important that we get value for money for the taxpayer.

Stephen Timms: I am grateful to the Minister for his visit last year to the excellent advice service at Community Links that is used by my constituents. Is he aware that funding cuts mean that that service will stop providing all welfare benefits advice next year, shortly before the massive upheaval that will follow the introduction of universal credit? Is not that a recipe for disaster?

Mr Djanogly: The legal aid scope changes will not come in until April 2013, but that is indeed something that is on the horizon. I have visited the right hon.

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Gentleman’s local law centre, and it is a very good organisation. As I said to him the last time he asked about this issue, changes are going to have to take place, and that is why we are looking to put in place transitional arrangements.

Alun Cairns (Vale of Glamorgan) (Con): The legal aid budget amounts to a spend of £39 per person in the UK, while it is nearer to £5 in Spain, France and Germany. Does the Minister agree that the present position in the UK is wholly unsustainable, and that savings have to be made in the light of the financial circumstances that we inherited from Labour?

Mr Djanogly: Savings do have to be made. A similar comparison can be made with a Commonwealth country such as New Zealand, where the figure is about £18 per head. We must ensure that the scarce resources are spent as well as possible, and that people do not go to court when they do not need to do so.

Victim Support

6. Derek Twigg (Halton) (Lab): What steps his Department is taking to support victims of crime. [92477]

9. Charlotte Leslie (Bristol North West) (Con): What steps his Department is taking to support victims of crime. [92481]

11. Rushanara Ali (Bethnal Green and Bow) (Lab): What steps his Department is taking to support victims of crime. [92483]

17. Mr David Burrowes (Enfield, Southgate) (Con): What steps his Department is taking to support victims of crime. [92489]

The Lord Chancellor and Secretary of State for Justice (Mr Kenneth Clarke): Yesterday, in a statement to the House, I launched a consultation on far-reaching proposals on the support provided to victims and witnesses of crime.

Derek Twigg: The prisoner who murdered the husband of my constituent, Helen Hill, is coming to end of his tariff and is currently undergoing day release. The exclusion zone that my constituent has asked to be applied to the murderer has been ignored. If the Government are serious about giving full rights to the victims of crime, should they not ensure that victims’ wishes on exclusion zones are adhered to?

Mr Clarke: We are very serious about ensuring that the system works correctly. Victims should be given information—in this case, about the possibility of the offender being released—and consulted on their views. There are arrangements, through the probation service, for liaising with the victim. Of course, I cannot guarantee that the victim will always agree with the decisions that are taken, but they should be taken while keeping in mind the interests of the victim and, in this case, above all, the need to protect her. I will happily check on what has happened in this case, but I would say to the hon. Gentleman that we are trying to improve the present system to make it live up to his expectation that full regard will be given to victims’ interests.

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Charlotte Leslie: Victims often feel that their rights are taken less seriously by the system than those of the perpetrator. What measures are the Government taking to ensure that victims, especially those of violent rape, and their families are financially compensated and supported following the often life-shattering traumas that they have experienced?

Mr Clarke: I announced yesterday that we were making changes to the compensation scheme, but we are making no changes whatever to the compensation for victims of rape and sexual offences at any level of the tariff. We accept that it is important to compensate those victims, and we are trying to strengthen the support that we give to the victims of sexual offences. We are also supporting outside bodies that give support to such victims. I think that my hon. Friend will find that nothing I said yesterday remotely reduces our commitment to the victims of rape and sexual offences, and that, since we have been in office, we have been steadily improving the services that we provide.

Rushanara Ali: Given that 61% of victims feel that the justice system is ineffective, and that the victims code will not be placed on a statutory basis, how will the rights of victims be properly protected by this Government?

Mr Clarke: I do not think that 51% of victims have a factual basis for saying that. I share the hon. Lady’s concern, however, that whenever questions are asked, if they are asked in the right way, we get that kind of answer. We have to get across to the public that the system does indeed punish offenders properly and attempt to reform them, and that we are steadily attempting to improve the support that we give to victims. It is extremely important that the criminal justice system should give the highest regard to victims, because protecting and giving justice to them and their families is one of the principal aims of the service.

Mr Burrowes: Will the implementation of the Government’s welcome victims strategy ensure that convicted offenders take personal responsibility for their crimes and make reparations to victims? Will it also, once and for all, take out of circulation the dreadful term “victimless crime”?

Mr Clarke: I share my hon. Friend’s view of the significance of this issue so that, wherever possible, criminals should make reparation for their crime and compensation should be paid to the victim. We are looking to take further action to reinforce the need for courts to try to make a compensation order whenever possible, and we are looking at ways of steadily improving how we collect the money from compensation orders when they are made. We are seeing steady improvement, but we need to go further.

Hazel Blears (Salford and Eccles) (Lab): The Secretary of State may be aware of the tragic case of my constituent, Clare Wood, who was murdered by a violent partner. It turned out that he had a huge history of domestic violence against other women. Will the Secretary of State support amendments to the Bill in the other place to ensure that victims like Clare can in future know

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about the history of their violent partners and make an informed decision on whether to continue in the relationship?

Mr Clarke: That is a familiar subject, which I believe is being reviewed by my right hon. Friend the Home Secretary. The right of women to know whether their partner or intended husband has a long history of domestic violence sounds like a worthwhile cause. I have no doubt that my right hon. Friend will be looking to the practical issues that would be involved in introducing an effective system.

Dr Julian Lewis (New Forest East) (Con): In opposition, we often made reference to the terrible effect on victims of crime of the fact that they thought the perpetrators had been sentenced to a certain term of imprisonment only to find them being released half way through it. Will the Secretary of State update the House on what progress we have made towards honesty in sentencing?

Mr Clarke: These conventions got worse when our opponents were in office. I say that before the right hon. Member for Tooting (Sadiq Khan) starts attacking me. I, too, have expressed views in the past about honesty in sentencing. What happens currently is that for most sentences, half the term is served in prison; beyond that, prisoners become eligible for release, but they are on licence and liable to recall for the full term of their sentence if they do not adhere to it. There are measures in the Legal Aid, Sentencing and Punishment of Offenders Bill, currently in the other place, that address the penalties to be imposed for various offences. In place of indeterminate sentences for public protection, for example, we are going back to how sentences used to be so that people will have long determinate sentences, and will normally serve two thirds of it before they are released. That is at least a step in the right direction for my hon. Friend.

Sadiq Khan (Tooting) (Lab): It is fair to say that, until she left her post in early October last year, the Victims’ Commissioner was a bit of a thorn in the side of this Government and this Justice Secretary in particular. The consultation paper on victims and witnesses, which was published yesterday, was completely silent on the future of that important post. Will the Justice Secretary reassure the House that he will not abolish this important advocate for victims and witnesses? When will the post be filled?

Mr Clarke: First, I can assure the right hon. Gentleman that I got on excellently with Louise Casey when she served in that role; it is a pity that she went away to carry out another even more important role in dealing with problem families. That can be checked with Louise Casey, but I would be surprised if she did not confirm my view. She made a contribution to policy. We are looking at this post again, and as I reminded the right hon. Gentleman the last time he raised the fact that we were still considering it, the last Government legislated for it in about 2004 and then took five years before they appointed anybody. There is a variety of views—from those responsible for victim support and others—on the best way to give proper force to victims’ views in government. We are considering those views before we make any announcement.

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Prison Officer Training

7. Guy Opperman (Hexham) (Con): What steps he is taking to encourage the inclusion of peer mentoring in prisons as part of the training of prison officers. [92479]

The Parliamentary Under-Secretary of State for Justice (Mr Crispin Blunt): Prison officer training aims to give officers an awareness of the benefits of peer mentoring currently provided by voluntary sector and faith organisations, such as the Shannon Trust’s toe-by-toe reading plan and the Samaritan-trained listener scheme. Our rehabilitation policy will encourage and facilitate mentoring for offenders by ex-offenders and other members of the public, as all parts of the justice system focus more on outcomes than inputs. The early payment-by-results pilots at Doncaster and Peterborough prisons both use peer mentoring, and the experience of these and all other pilots will guide future training and practice.

Guy Opperman: Does the Minister believe that the expansion of private provision in prisons and the payment-by-results scheme will lead to more peer mentoring and better prison officer training, and that rehabilitation rates will improve as a result?

Mr Blunt: Yes, but the payment-by-results scheme is not limited to private sector prisons. We are piloting it in two public sector prisons as well. The National Offender Management Service is to contribute £1.4 million to eight voluntary sector organisations to help with mentoring, and is also involved in a Europe-funded project that is assessing the relative benefits of mentoring by peers and non-peers.

Steve McCabe (Birmingham, Selly Oak) (Lab): Will the Minister consider the effectiveness of training when it comes to security issues? Will he look into how on earth Bilal Zaheer Ahmad, who is serving 12 years in prison and was described as

“a viper in our midst”

by the judge who jailed him under the Terrorism Act 2000, managed to send a six-page letter from his Belmarsh cell that advised potential terrorists on the best way to outwit our police and security services? Will this latest lapse be investigated by the Justice Secretary?

Mr Blunt: Of course that will be investigated, as, indeed, is every security breach.

Tom Brake (Carshalton and Wallington) (LD): Following the tragic deaths of two teenagers at young offenders institutions in the last week, will the Minister examine the role of peer mentoring in helping people to detect those who are at risk of self-harm or suicide?

Mr Blunt: Of course our condolences go out to the families in question. However, I understand that this is the first time such a thing has happened on the under-18s estate since 2007, and the fact that there have been two tragic incidents in close succession does not mean that we should not recognise the good record that has been maintained in the intervening years. Every effort will be made to learn all the lessons from what has happened during the four different types of inquiry that will take place into each of the deaths.

Mr Speaker: I call Michael Connarty. He is not here, so I call Dave Watts.

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Probation Service

10. Mr Dave Watts (St Helens North) (Lab): What steps he plans to take to maintain public safety when implementing his plans for the future of the Probation Service. [92482]

12. Martin Caton (Gower) (Lab): What steps he plans to take to maintain public safety when implementing his plans for the future of the Probation Service. [92484]

13. Toby Perkins (Chesterfield) (Lab): What steps he plans to take to maintain public safety when implementing his plans for the future of the Probation Service. [92485]

15. Karl Turner (Kingston upon Hull East) (Lab): What recent steps he has taken to review the work of the Probation Service; and what his policy is on the reform of the service. [92487]

The Lord Chancellor and Secretary of State for Justice (Mr Kenneth Clarke): Public safety will always be of paramount importance when we are considering the way in which probation services are delivered. We are working on proposals to deliver more effective and efficient probation services, and will present them for consultation shortly.

Mr Watts: How does the Secretary of State plan to help the probation service to deal with the increased risk to the public, given his proposal for the abolition of indeterminate sentences for public protection?

Mr Clarke: We debated that at great length in the House. IPPs were regarded by most people in the field of criminal justice as a complete disaster when they were approved in the last Parliament, and our proposed reform of them was strongly welcomed by most who practised in that field. We are replacing them with tough determinate sentences, of which people will serve two thirds before they are eligible for release. Even then, they will not be released unless the Parole Board is satisfied that they have completed their sentences. We were acquiring an impossible system before that, under which thousands of people were accumulating in prison with no real prospect of a rational basis for their release.

Several hon. Members rose

Mr Speaker: No one enjoys listening to the Secretary of State more than I do, and I have been doing so for more than two decades, but we have a lot to get through, so economy is of the essence.

Martin Caton: There is a real fear both inside and outside the House that introducing a payment-by-results approach to our Probation Service risks denying adequate rehabilitation support to those with the most complex needs. What will the Secretary of State do to mitigate that risk?

Mr Clarke: I think that it is key to public service to concentrate on what we are delivering that is of value to the people we are trying to serve. Focusing our resources on programmes that succeed in reducing the reoffending rate, thereby reforming former offenders and ensuring

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that they do not create future victims of crime, will help us to ensure that we secure value for money, and will also stimulate innovation and best practice. I think it very reactionary to suggest that we should abandon the payment-by-results approach.

Toby Perkins: As the Secretary of State will know, when probation is seen to fail and ex-offenders reoffend, it is often because the various organisations involved have failed to work together. What steps will he take to ensure that the marketisation of probation services, with many different providers potentially doing different things, does not lead to more fragmentation and more tragedies?

Mr Clarke: I agree. We normally need people to co-operate quite closely to achieve successful outcomes if we are trying to reform offenders. Those who are trying to attract funds by achieving successful results in their programmes will, I hope, enter into collaborative arrangements with other providers. It must be a good thing that we are contemplating the possibility of bringing in more voluntary, charitable, private sector providers alongside the probation service and deciding where to channel most of our money on the basis of the success they achieve.

Karl Turner: I recently met Steve Hemming, chief executive of Humberside probation trust. He is due to retire in April after 30 years of long, loyal and patient service to the trust, but he is concerned that his patience might be about to run out. When will the Government publish their long-awaited probation review?

Mr Clarke: First, may I pay tribute to the retiring chief executive of the hon. Gentleman’s probation trust? There are many dedicated people in the probation service doing very valuable jobs on behalf of the public they serve. I am glad our consultation document is so eagerly awaited; we have been taking some time over it as we are trying to get it right, but we shall produce it soon.

Andrew Bridgen (North West Leicestershire) (Con): Does my right hon. and learned Friend agree that the probation service has substantially been financially protected when taking into account the overall demands on the budget of the Justice Ministry?

Mr Clarke: I am not sure whether that is right, but I shall check. What my hon. Friend may have noticed is that this year we cut some other services’ budgets more sharply than we cut that of the probation service, but that is because the previous Government had been cutting the probation service budget pretty sharply, once they finally woke up to the fact that we were in a credit crunch and a financial crisis. They hit the probation service first.

Philip Davies (Shipley) (Con): In the last year for which I have figures for the Department, 6,600 criminals deemed high or very high risk by the probation service were serving community sentences. Does my right hon. and learned Friend think public safety would be better improved if some—or, indeed, most—of those people were in prison?

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Mr Clarke: Sentencing guidelines should ensure that those who deserve to go to prison because of the severity of their offence, and those who need to go to prison in order to protect the public properly, do go to prison. Those who get community sentences are graded according to risk. More attention must be paid to those who are near the risk threshold of needing to go to prison rather than those who pose quite a low risk of reoffending. With respect however, I think my hon. Friend is slightly misinterpreting what is called the risk assessment for people on community sentences. People who should go to prison should be sent to prison by the courts, and they are.

Andrew Selous (South West Bedfordshire) (Con): Does my right hon. and learned Friend agree that it is ridiculous that unaccountable managers in the National Offender Management Service can undo all the good work done by probation officers by putting an ex-offender back in prison purely for having been a conscientious employee who was kept on late at work?

Mr Clarke: If those are the facts of the case, I entirely agree with my hon. Friend. He is obviously concerned about this case, and if he thinks something has gone badly wrong, I know him well enough to share his concern. I have had a word with the prisons Minister about this case, and we will investigate the facts and come back to him. The events as described obviously should not happen; that is not how the system is supposed to work.

Mrs Jenny Chapman (Darlington) (Lab): I have listened to the Secretary of State’s responses on indeterminate sentences for public protection and payments by results and he is clearly feeling very optimistic. While we all like someone with a sunny disposition, when considering public protection issues it is also important to plan for failure. Does the Secretary of State plan to monitor the financial help given to providers of probation services in the community so that we avoid a criminal justice equivalent of Southern Cross?

Mr Clarke: When people provide services, of course it is necessary before giving them the contract to do one’s best to check on their financial health, but this issue has moved beyond arguments about whether a provider should be from the voluntary sector or a for-profit or not-for-profit provider. I wish to maximise the service given to the public by those who provide community-based sentences in this country, and we need to encourage innovation and best practice wherever we can.

Prison Places

14. Kerry McCarthy (Bristol East) (Lab): What arrangements his Department has put in place to deal with any future shortfall in prison places. [92486]

The Lord Chancellor and Secretary of State for Justice (Mr Kenneth Clarke): On Friday 27 January, the prison population was 87,668 against a capacity of 89,399 places, providing headroom of 1,731 places, so there are sufficient places for those being remanded and sentenced to custody. We will keep the prison population under

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careful review to ensure that there is always sufficient capacity to accommodate all those committed to custody by the courts.

Kerry McCarthy: I thank the Secretary of State for that response. I understand that possible shortfalls are predicted in particular regions as opposed to on a national level. The Minister will know that maintaining family links during a period of imprisonment is a critical factor in reducing reoffending on release. Will he assure the House that steps will be taken to ensure that prisoners are kept as close to their family and their place of origin as possible?

Mr Clarke: In many cases, a high priority is given to trying to house prisoners in places where they are reasonably in contact with their family and home. Of course, the more pressure the service comes under, the more difficult it is to maintain that, but I am sure it remains an objective of those who allocate prisoners to the correct prison once they receive their sentence.

Legal Aid

16. Geraint Davies (Swansea West) (Lab/Co-op): What assessment his Department has made of the effect on women of his proposed changes to legal aid. [92488]

The Parliamentary Under-Secretary of State for Justice (Mr Jonathan Djanogly): The Government published an equality impact assessment alongside their response to the consultation, which set out the best assessment of the effects on women of the proposed changes to legal aid. This recognised the potential for the reforms to have an impact on women alongside those with other protected characteristics. We have taken the view that any such impacts would be justified in the light of the policy objectives, especially in the context of reducing the deficit.

Geraint Davies: The Minister knows that the courts are already in crisis due to a shortage of court and judge time. Will he accept that the removal of legal aid will encourage more and more women to provide their own defence, which will add to the crisis of delays and will mean further delay for children, bringing hardship to families and children?

Mr Djanogly: There is no shortage of court time or judge time. I simply do not accept what the hon. Gentleman says.

Miss Anne McIntosh (Thirsk and Malton) (Con): I understand why my hon. Friend is bringing forward the changes, but is he aware of the perverse consequences on new entrants to the Bar, particularly women, given the opportunities in relation to being mobile and entering a legal profession in which one or one’s family have not been involved? Doors are being slammed in women’s faces.

Mr Djanogly: Certainly, as far as solicitors are concerned, the number of entries to the profession by women is now greater than by men. I believe the same is the case for barristers, but I will check and come back to my hon. Friend.

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Greater Manchester Intensive Alternative to Custody Project

18. Paul Goggins (Wythenshawe and Sale East) (Lab): What assessment he has made of the effectiveness of the Greater Manchester intensive alternative to custody project in reducing reoffending and the use of short-term prison sentences. [92490]

The Minister for Policing and Criminal Justice (Nick Herbert): We are currently considering the feasibility of an evaluation of intensive alternative to custody projects by comparing reoffending rates with those for similar offenders receiving custodial sentences.

Paul Goggins: I am grateful to the Minister for that answer. As he knows, the Manchester project is aimed at 18 to 25-year-olds who would otherwise go to prison. Those offenders have a reoffending rate of 18%, whereas the rate for offenders of a similar age who go to prison, which costs 10 times more, is 58%. Will he bear that evidence in mind and, as a Minister who believes in payment by results, make sure that funding goes to such projects as a priority?

Nick Herbert: I accept the force of the right hon. Gentleman’s comments and I have visited those responsible for running the scheme in Manchester as he knows—indeed, I think it was at his instigation. It is important that we evaluate these projects properly, and our general position is that we want to have more punitive community sentences, which are effective and combine rehabilitation with a punitive element. If possible, we want such schemes to be mainstreamed so that they can be taken beyond their pilots.

Mr Speaker: With reference to alternative to custody projects, Mr Paul Maynard.

Paul Maynard (Blackpool North and Cleveleys) (Con): Thank you Mr Speaker, and indeed it is. If we are to increase public confidence in more intensive forms of community sentencing, we clearly need to link them, as we have just heard, to evidence showing how they reduce reoffending. In the commendable analysis of the pilot in Manchester published in July 2011 by the Ministry of Justice, the difficulty of calculating reoffending statistics is made clear. Will the Minister reassure me that he will do all he can to square this circle so that we can persuade members of the public that this is the way forward?

Nick Herbert: Yes, my hon. Friend makes a good point. There have been difficulties, which is why we are assessing the feasibility of evaluation. We need the data for the reasons he gives: it is important that the public know how effective the disposals are and, in the future, that will be important for proposals on payment by results. Where they are successful and reduce reoffending, which we have had great difficulty delivering through short-term custodial sentences, such measures should be considered.

Conditional Fee Arrangements

19. Kevin Brennan (Cardiff West) (Lab): What assessment he has made of the effect of his reforms to conditional fee arrangements on people's ability to pursue civil cases against newspapers and other media organisations. [92491]

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The Parliamentary Under-Secretary of State for Justice (Mr Jonathan Djanogly): The Government are reforming the operation of conditional fee agreements through the provisions of the Legal Aid, Sentencing and Punishment of Offenders Bill. The relevant impact assessments are published on the Ministry of Justice website. We believe that meritorious claims, including against media organisations, will still be able to secure representation under CFAs.

Kevin Brennan: Victims of phone hacking are absolutely clear that they would not have been able to take their cases forward were it not for no win, no fee arrangements being available; nor would the critical mass of cases been built up to break the scandal open. Why are the Minister and the Government on the side of powerful media moguls against vulnerable victims?

Mr Djanogly: Quite the opposite: in fact, the high and disproportionate costs in the present system hinder access to justice and can lead to a chilling effect on journalism and academic and scientific debate. In the Naomi Campbell case, the European Court of Human Rights found the existing CFA arrangements with recoverability in that case to be contrary to article 10 of the convention.

Topical Questions

T1. [92496] Andrew Stephenson (Pendle) (Con): If he will make a statement on his departmental responsibilities.

The Lord Chancellor and Secretary of State for Justice (Mr Kenneth Clarke): May I update the House on the progress the Government have made toward implementing their proposals for payment by results, which I was defending a few moments ago? We have recently identified two probation trusts, one in Wales and the Staffordshire and West Midlands probation trust, to develop the community payment by results approach to probation services. We already have two well-established pilots in privately managed prisons and we hope to develop more; further pilots are being developed in public sector prisons. We are seeking proposals from the market for additional innovative contracts. We have selected a national framework of providers to support this work, which will assist us in meeting our commitment to roll out the principles of payment by results throughout the criminal justice system.

Andrew Stephenson: I hope the Secretary of State agrees with me that it is disgraceful that criminals who have created victims of crime are compensated under the criminal injuries compensation scheme. How much have criminals received over the past 10 years?

Mr Clarke: It is £75 million in the past 10 years, I think, and about 20,000 offenders have been compensated—I am remembering the brief for my statement yesterday. It is plainly insupportable that one week someone can commit a crime at his victims’ expense, and within a very short time claim that the taxpayer should compensate him because someone has committed a crime against him. We are bringing that to an end.

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Robert Flello (Stoke-on-Trent South) (Lab): Last week, there were two tragic deaths of young people in custody: Jake Hardy, a 17-year-old held at Hindley, and 15-year-old Alex Kelly, a prisoner at Cookham Wood. Although, rightly, there will be investigations and inquests, urgent questions need to be answered. Had mental health assessments been undertaken? Were the boys receiving treatment? Had there been any fighting involving these children? Were any forms of restraint used? Will the Secretary of State make urgent inquiries into the circumstances of the deaths to address concerns that this may be a new systemic problem, and inform the House?

The Parliamentary Under-Secretary of State for Justice (Mr Crispin Blunt): Yes. The hon. Gentleman will be aware that four separate types of inquiry are to be conducted. Later today I will meet the chairman and chief executive of the Youth Justice Board and discuss those cases.

T2. [92497] Mr Mark Spencer (Sherwood) (Con): Following the horrific murder of my constituent Kynan Eldridge, I wonder whether the Minister can assure the House and Kynan’s family that the perpetrators of such crimes, if they are foreign nationals, will be deported after their sentence ends? What work is he doing to ensure that that happens?

Mr Blunt: My hon. Friend will have heard the exchanges earlier about foreign-national offenders. We are doing everything that we can to improve the legal situation, so that we have more powers to deport people and can improve the administrative process through proper co-operation between the UK Border Agency and the National Offender Management Service.

T4. [92499] Jessica Morden (Newport East) (Lab): Last month, Welsh Women’s Aid surveyed 324 victims of domestic violence who were receiving specialist support, and it found that 46% of them would not be eligible for legal aid if the Government’s proposals were carried out. Why will the Government not listen to the evidence, which plainly points to the fact that many victims of domestic violence will be denied access to justice?

The Parliamentary Under-Secretary of State for Justice (Mr Jonathan Djanogly): We have had the Welsh report and are looking at it, but we dispute the figures in it. As I have said on many occasions, when it comes to legal aid, we are concentrating our efforts on helping to deal with domestic violence, and that will be the case following our reforms.

T3. [92498] Andrew Selous (South West Bedfordshire) (Con): Do Ministers share my concerns about the unacceptable burdens placed on small businesses by ambulance-chasing lawyers, who pursue those businesses for spurious claims when they have no right to do so?

Mr Djanogly: The Government are taking firm, significant steps to address the burgeoning claims market, which, as my hon. Friend says, particularly encourages low-value claims against businesses and others—claims for which we all end up paying. That is why we are

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reforming no win, no fee conditional fee agreements and banning referral fees, and why we are countering illegal text advertising and consulting on banning inducement advertising.

T6. [92501] Derek Twigg (Halton) (Lab): I thank the Secretary of State for saying, following my earlier question, that he would look at the case that I mentioned, but will he examine, or get his Department to examine, whether there is consistency among parole boards and prison governors when it comes to licence conditions relating to exclusion zones? There is nothing worse than a family bumping into the murderer of a loved one in the street, or in the locality. Will he look at the consistency of parole boards’ and governors’ decisions?

Mr Kenneth Clarke: I will certainly look at that, because I agree with the hon. Gentleman that there should be consistency. That is why we have exclusion zones—precisely to make sure that the victims of a criminal do not find that they accidentally bump into him again, or even worse, are pestered by him when he is released from prison. We all take cases of the kind that he raises very seriously, and we will look into this one.

T5. [92500] Dr Sarah Wollaston (Totnes) (Con): Devon Rape Crisis was launched last November and has already helped many victims of sexual violence across Devon, but it and Rape Crisis England and Wales are calling for changes to make it easier to identify the number of victims of crimes that are sexually motivated. Will the Secretary of State meet Rape Crisis and me to discuss how we can make such crimes more easily identifiable, and to hear about the excellent work of Rape Crisis?

Mr Blunt: My hon. Friend has raised an important issue, and I would be very pleased to meet her and colleagues from Rape Crisis to look at the linkages, and at the proper examination and analysis of data in this area. It is important that we continue to improve our knowledge.

T7. [92502] Mr Gareth Thomas (Harrow West) (Lab/Co-op): Will the Secretary of State explain how he thinks that axing 1,000 posts at the Crown Prosecution Service will help him to bring more criminals to justice?

Mr Kenneth Clarke: I am sure that my right hon. and learned Friend the Attorney-General has ensured that, in making changes to the budget and staffing of the Crown Prosecution Service, he is not reducing the quality of service that it provides. These things are not best measured by whether a body has ever-expanding payrolls or budgets; that tended to be the approach of the former Government, in which the hon. Gentleman served. We are trying to produce better value for money, in order to cope with the appalling financial crisis that we inherited from our predecessors.

T8. [92503] Michael Ellis (Northampton North) (Con): The trade unions directly benefit from current no win, no fee arrangements, earning huge amounts via their legal arms through inflated success fees. What

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assessment has the Minister made of the amount of success fees paid to trade unions, particularly in personal injury cases?

Mr Djanogly: Unfortunately, the trade unions did not provide their lawyers’ success fee details, or their referral fee income details, to the consultation. However, given that they have received more than £550,000 in donations from personal injury lawyers, it seems that the unions’ lawyers are not entirely disinterested in the outcome of our attempt to rein in the compensation culture.

Ian Lucas (Wrexham) (Lab): How is it that an individual on remand for murder can hang himself while in custody? Will the Secretary of State hold an urgent inquiry?

Mr Blunt: Of course, in all these cases there are immediate operational inquiries, and then there are proper coroners’ inquiries. In all such cases, there will then be an inquiry by the prisons and probation ombudsman. These matters are taken extremely seriously. The number of self-inflicted deaths in custody has been falling, but there have been a number of tragic cases recently. Of course, we will look at all this extremely seriously.

T9. [92504] Mr Peter Bone (Wellingborough) (Con): This splendid Conservative-led coalition Government have done much in the fight against human trafficking. The poor women who are victims of human trafficking and sexual exploitation and who are then rescued go into the national referral mechanism, but what happens to them after 45 days? Are they thrown out if they do not qualify?

The Minister for Policing and Criminal Justice (Nick Herbert): No, I am happy to reassure my hon. Friend that that is certainly not the case. There is an ongoing process of assessment and support during the 45-day period, after which victims continue to receive support as necessary in Salvation Army outreach centres or from mainstream services. We are determined to improve the service provided to victims of these appalling crimes and have protected funding in order to do so.

Fiona Mactaggart (Slough) (Lab): John Anslow is the first category A prisoner to escape for 17 years. Does the Secretary of State know why?

Mr Blunt: The matter is understandably being inquired into, and in due course we will report back.

T10. [92505] Mr Robert Buckland (South Swindon) (Con): Residents and organisations in my constituency will welcome the Government’s decision to update the law relating to scrap metal. When will the necessary amendments to the Legal Aid, Sentencing and Punishment of Offenders Bill be brought forward?

Mr Kenneth Clarke: I share my hon. Friend’s concern to see the Government move on this matter as quickly as possible. I assure him that we are working carefully with colleagues on the drafting and hope to be able to table amendments to the Bill, which is currently before the House of Lords, as soon as possible.

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Dr William McCrea (South Antrim) (DUP): Many innocent victims of crime feel isolated and dissatisfied at the end of the justice process. Will the Secretary of State assure me that protection of, and justice for, the victim will be fundamental to the reformed criminal justice system?

Mr Clarke: I hope that I can assure the hon. Gentleman and that he will have the opportunity to study the consultation document I published yesterday. I concede that there has been a steady process of improvement over the years, compared with the situation not too long ago, when victims were regarded simply as people who had to come to court if they were needed, but we still have not gone far enough. We must ensure that the experience of being in court does not add to a victim’s suffering, that all proper support is given to those who have been badly and lastingly affected by what has happened to them and that there is a proper system of compensation. The object of the criminal justice service must be to give proper service to the victims of crime.

Greg Mulholland (Leeds North West) (LD): It has come to light that barrister David Friesner recently defended a fraudster, despite having just been convicted for stealing £81,000. We had an absurd situation in which a criminal was representing a criminal, which brings the legal system into disrepute. Will the Minister look into the actions of the Bar Standards Board and consider mandatory suspension for those guilty of serious crimes?

Mr Speaker: Order. My firm impression is that this matter is currently sub judice and, if I am correct in that surmise, I know that the Minister will exercise his customary lawyerly caution, and it might well be that silence is the best policy.

Mr Djanogly: I shall indeed be cautious, Mr Speaker, but I can say that I certainly agree with and understand my hon. Friend’s concerns. This is a regulatory matter, rather than a legislative loophole, but we are in contact with the BSB about it.

Mr Barry Sheerman (Huddersfield) (Lab/Co-op): Will the Minister recognise the effectiveness of multi-agency working, which is usually led by the probation service? I recently visited the Huddersfield probation office and was surprised by how effective such working is in cutting the levels of crime and reoffending.

Mr Blunt: The hon. Gentleman is absolutely right to draw the House’s attention to the benefits of more effective integrated offender management, which is another way of expressing the multi-agency working to which he draws attention. This good practice is widening across the whole system and, I am delighted to say, becoming the norm.

Mrs Helen Grant (Maidstone and The Weald) (Con): One in four girls, some as young as 13, are hit by their boyfriend. What action will the Minister take to tackle violence among children?

Mr Djanogly: Tackling domestic violence is an absolute priority of this Government, and we are co-ordinating action with the Home Office. Indeed, my hon. Friend

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appeared in a debate that was held in Westminster Hall only a few days ago, and she will have seen the full picture at that time.

Yvonne Fovargue (Makerfield) (Lab): In the Ministry of Justice’s own impact assessment of the cuts to civil legal aid, there are 15 statements that the Ministry does not have evidence for the savings and 30 admissions that the savings are based on speculation. Should not the Secretary of State listen to Citizens Advice and King’s college London, which can demonstrate that the cuts will cost the taxpayer more than they will save?

Mr Djanogly: We have seen the King’s college figures, and we do not agree with them. The fact of the matter is that we have published full impact assessments, and we stand by them.

Mr Edward Timpson (Crewe and Nantwich) (Con): More than half of male prisoners and almost three quarters of female prisoners have no qualifications at all. What efforts are being made, through the training of prison officers, to raise awareness of the importance and availability of prison education in our prisons?

Mr Blunt: We have recently re-let the offender learning and skills contracts, which are funded through the Department for Business, Innovation and Skills. That is about £157 million worth of education which is being put into skilling-up offenders, not least so that they can then take part in our work in prisons strategy and we can get much more effective and economic use of prisoner time in prison—with enormous benefits for them on release.

Mark Durkan (Foyle) (SDLP): Is the Secretary of State aware that yesterday the Northern Ireland Human Rights Commission registered profound concerns about the “Justice and Security” Green Paper’s proposals on closed material proceedings? Will he accept that moving to provide for secret trials and secret inquests has acute implications in the context of Northern Ireland, not least its impact on transitional justice and on the efforts to deal with the legacy of the past?

Mr Kenneth Clarke: As the hon. Gentleman knows, we are consulting on those proposals in relation to that difficult subject. All I can say is that I certainly appreciate

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its special significance for Northern Ireland and the situation in Northern Ireland, and we will pay the most careful regard to the submissions that we receive from all those interested in Northern Ireland before we come to our conclusions.

Duncan Hames (Chippenham) (LD): Throughout the 18 months to the end of September 2011, consistently more than half of appeal cases relating to employment and support allowance took longer than six months to be decided by the Courts and Tribunals Service, meaning that more than twice as many people as the service’s own target are waiting that long. What action is the Minister taking to ensure that they receive their decisions in good time?

Mr Djanogly: The service is under pressure because of an increase in appeals, but I am very pleased to say that in five of the past six months more appeals have gone out the door than have come in.

Mr Speaker: Last but not least, Mr Toby Perkins.

Toby Perkins (Chesterfield) (Lab): Last week I met the family of Jake Hardy, a 17-year-old with learning difficulties who died last week after hanging himself in Hindley young offenders institute. The family tell me that Hindley was aware that Jake had been a victim of systematic bullying, was of low mental capacity and had self-harmed earlier in the week, yet it declined to place him on suicide watch. What steps will the Minister take to ensure that the full facts of the case emerge, and what will he do to prevent another family from feeling the grief felt by the Hardys?

Mr Speaker: Order. Again, I rather suspect—I am not a lawyer, and I say that as a matter of some very considerable pride, but as far as I am aware—the question is likely to be sub judice. I do not criticise the hon. Gentleman, but I exhort the Minister to be characteristically cautious in his response.

Mr Blunt: I am grateful, Mr Speaker. The case has been referred to several times in the course of today’s questions, and I do not have anything more to add to the answer that I have given. The hon. Gentleman knows that I am seeing the chairman and the chief executive of the Youth Justice Board later on today, and the case will of course be on the agenda for our discussions.

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Informal European Council

3.33 pm

The Prime Minister (Mr David Cameron): With permission, Mr Speaker, I should like to make a statement on yesterday’s informal European Council.

Countries right across Europe need bold action to recover their economic dynamism, to get to grips with their debts and to secure growth and jobs for the future, and that was rightly the focus of this Council. So, first, we agreed important measures needed to restore Europe’s competitiveness; next, we discussed the separate intergovernmental treaty on fiscal discipline in the eurozone; and, finally, we issued a statement on Iran, Syria and Burma. I am going to take each in turn.

Britain’s agenda in Europe is to promote growth, competitiveness and jobs. We have said repeatedly that the best way in which the EU can drive growth and create jobs is to complete the single market, establish trade deals with the fastest growing parts of the world and cut the regulatory burdens on business. At this Council we made important progress on all those issues.

We agreed to establish a fully functioning single market in services, where there are still 4,700 professions across Europe for which access is regulated by Government, and in digital, where there are more than a dozen copyright regimes in what should be one single market. We will take action to secure what should be a fast-growing area right across Europe. The changes on services and digital alone could add more than 6% to EU GDP within a decade. We also agreed to complete the energy single market, which has the potential to cut costs for businesses and consumers across Europe.

On free trade, we said that 2012 should be a “decisive year” in which to move ahead on trade agreements with major partners such as Japan, India, Canada and the United States. On regulation, we agreed to a growth test, for the first time, to ensure

“that all actions at the European Union level fully support economic growth and job creation.”

We also agreed to reduce regulatory burdens, especially for small and medium-sized enterprises and micro-enterprises, and to complete a patent package to support innovation. That has been discussed in Europe for more than a decade and finally we are making decisive progress.

We want the eurozone to sort out its problems, which are having a chilling effect on our economy. Tackling them is one of the best ways in which we can help to secure growth in Britain and right across Europe. As I have said repeatedly, short-term steps—the so-called October package—must be taken, and taken properly. Europe’s banks must be recapitalised properly, the uncertainty in Greece must be brought to a decisive end, and the firewall that needs to be constructed must be big enough to deal with the full scale of the crisis and the potential contagion. In the longer term, proper fiscal discipline in the eurozone is clearly an important part of the solution. Britain recognises that that is necessary. The question has never been whether there should be greater fiscal discipline in the eurozone, but how it should be achieved.

I went to the European Council last December prepared to agree a treaty of all 27 countries, but only if there were proper safeguards for Britain. I did not get those

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safeguards, so I vetoed the treaty. As a result, eurozone countries and others are now making separate arrangements outside the EU treaties for strengthening budgetary discipline, including by ensuring that there are much tougher rules on deficits. At this Council, 25 EU member states agreed a new treaty outside the EU. Britain and the Czech Republic have not signed up and we will not be taking part.

Let me deal directly with the issue of the institutions. The new agreement sets out roles for the European Commission and the European Court of Justice. Although some of those roles are permitted through existing treaties, there are legal questions about what is planned. As I have said, it is in Britain’s interests that the eurozone sorts out its problems. It is also in our interests that the new agreement outside the EU is restricted to issues of fiscal union and does not encroach on the single market. The new intergovernmental agreement is absolutely explicit and clear that it cannot encroach on the competences of the European Union and that measures must not be taken that in any way undermine the EU single market. Nevertheless, I made it clear that we will watch this matter closely and that, if necessary, we will take action, including legal action, if our national interests are threatened by the misuse of the institutions. [ Interruption. ]

Mr Speaker: Order. There is a fine line between jollity and hysteria. I fear that the hon. Member for Rhondda (Chris Bryant) is in danger of having crossed it. He must calm himself, by whatever means necessary.

The Prime Minister: The principle that the EU institutions should act only with the explicit authorisation of all member states remains. Let me be clear: this is a treaty outside the EU. We are not signing it, we are not ratifying it, we are not part of it and it places no obligations on the UK. It does not have the force of EU law for us, nor does it for the EU institutions or for the countries that have signed it, and there will be no inner group of European countries distorting the single market from inside the EU treaty. That is the fundamental protection that we secured with our veto in December, and that protection remains.

We also made an important statement on developments in Iran, Burma and Syria. Britain has played a leading role in getting Europe to act together on each of those issues. On Iran, last week all EU countries agreed an unprecedented oil embargo, which shows our determination to keep up the pressure on the regime to turn away from any plans to develop nuclear weapons.

In Burma, for years Aung Sang Suu Kyi has been an inspiration to her people and to the world. Britain has supported her at every stage and has been at the forefront of EU sanctions. Now there are signs of a new moment of opportunity for democracy, and we should be prepared to relax those sanctions, but only in stages and only in response to reforms. When I spoke to Aung Sang Suu Kyi on Saturday, she emphasised the importance of credible and free by-elections in April. I can assure the House we will be watching that very closely.

On Syria, the Council condemned the continuing violence and the repression of the Syrian people. Reports suggest that more than 60 people were killed on the streets of Syria last week alone. In total, more than 5,000 people have been killed, 400 children murdered and tens of thousands of people detained. Today, the

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Foreign Secretary is in New York to support the Arab League’s call for Security Council action condemning repression and supporting a transition of power. All 27 EU member states backed that call for UN action, and if the violence does not end, we agreed that we would tighten EU sanctions further. Our message is clear: we will stand with the Syrian people. It is time for all members of the UN Security Council to live up to their responsibilities instead of shielding those who have blood on their hands. The killing must stop, and President Assad must stand aside.

This was an important Council for Britain. On competitiveness, the single market and trade, Britain is setting the agenda. On action to face down dictators and dangerous regimes in Iran and Syria, Britain is leading the way, and by saying no to a new EU treaty we have protected Britain’s interests. I commend this statement to the House.

3.41 pm

Edward Miliband (Doncaster North) (Lab): I thank the Prime Minister for his statement and associate myself with his remarks about Iran, Syria and Burma. On those issues there has been a bipartisan approach, and the Government have our full support in the effort they are making.

Having heard the Prime Minister’s statement on Europe, the whole House now knows the truth—that with this Prime Minister, a veto is not for life, it is just for Christmas. He said—[Interruption.] Calm down, dear, calm down. He said that it was a real veto on the use of European institutions, and his Back Benchers believed him. Even his Cabinet believed him. What did the welfare Secretary—where is he?—say just this weekend? He could not have been clearer. He said:

“The fact is the Prime Minister vetoed them using the institutions”.

There was not a glimmer of doubt in his mind. He was asked whether the structures of the EU would be used for the fiscal compact, and he said:

“The Prime Minister has already made it clear…he vetoed any such possibility of that happening.”

It is no wonder the welfare Secretary said that, because it was what the Chancellor said the day after the summit. He said on the Saturday morning:

“If we had signed this treaty…we would have found the full force of the…European court, the European Commission, all of those institutions enforcing those treaties using that opportunity to undermine Britain’s interests…We were not prepared to let that happen.”

Can the Prime Minister now confirm that the treaty will be ruled on by the European Court of Justice? Article 8 of the treaty says yes. Can he tell us whether the European Commission will implement the treaty? Article 8 says yes.

What about the Prime Minister’s line in the sand? We know that at 4 am on that fateful Friday morning, he laid down the law to his fellow European leaders and said, “You won’t be able to use the buildings.” So can he now tell us whether the buildings of the European institutions will be used? Apparently, the answer to that is yes, too. On the European Court, the Commission and the buildings, the phantom veto of December is now exposed.

What does the Prime Minister cling to? What did he say at the press conference yesterday? He said:

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“There isn’t an EU treaty because I vetoed it; it doesn’t exist.”

The agreement involves the European Court of Justice, the European Commission, the European buildings, 25 out of 27 countries, and he says that it is not really a treaty. [Interruption.] Here is the treaty. It talks like a European treaty, it walks like a European treaty—it is a European treaty.

For Britain, the Prime Minister has secured no protections at all. He says that he has secured protections about discussions on the single market, but the treaty says that the contracting parties shall take actions in the following areas:

“Fostering competitiveness. Promoting employment. Reinforcing financial stability.”

It sounds like the single market to me. Can he confirm that the United Kingdom will not even have observer status at the regular meetings of the 25 to find out what is going on and whether the single market is being discussed? The Prime Minister needs to answer the question: who will protect the British national interest at those meetings? I think his Back Benchers will be interested in that. [Interruption.] It is all right, Mr Speaker, Britain will not be represented at those meetings, but the Prime Minister has a last line of defence—the European Commission. You could not make it up: the Prime Minister reduced to relying on the people he calls “the bureaucrats from Brussels” to represent him at the meetings. In the Prime Minister’s topsy turvy world, that is all he has left: his thin blue line against the 25 countries exceeding their mandate.

Instead of ending up in that position, the Prime Minister should not have walked out of the meeting in December. [Interruption.] No, he should not. [Interruption.]

Mr Speaker: Order. I apologise for interrupting the Leader of the Opposition. I exhorted the Opposition Benches to some calm; I now do so to the Government Benches. I say to the hon. Member for Shrewsbury and Atcham (Daniel Kawczynski) in the nicest, kindest and most public-spirited way possible that if he insists on gesticulating, which he should not, it is pretty silly to do it when he is standing next to me.

Edward Miliband: Instead of constructing phantom vetoes, the Prime Minister should have been getting a solution to the problems of the eurozone—our largest export market. Of course, he cannot do that. He is committed to failing austerity at home, so he cannot oppose collective austerity abroad. There are growing fears that the scale of austerity required under the treaty will not work. Will the Prime Minister therefore tell us whether the economic strategy in the fiscal compact will work? If he does not believe that it will work, why is he not arguing for change?

The summit has been bad for Britain. There is still no solution to the problems of growth in Europe. In the cold light of day, the Prime Minister’s veto that never was has been exposed. He made a grand promise, which turned out to be worthless. No wonder that even his Back Benchers say that they cannot believe a word he says.

Britain stands with less influence than we have had for a generation. It is bad for business, bad for jobs and bad for families. Britain deserves better.

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The Prime Minister: I tell you what: I will deal with my Back Benchers, you deal with yours. [Interruption.]

Mr Speaker: Order. Mr Ellis, you were apologising to me yesterday for losing your cool. You should not be a recidivist. I want to hear the Prime Minister even if you do not.

The Prime Minister: Thank you, Mr Speaker.

Let me say to the Leader of the Opposition that there are two problems with the approach he is taking. The first is that he cannot actually tell us whether he is in favour of this treaty or against it. The Government are clear: we are not signing it and we do not agree with it. That is why we vetoed it being within the EU treaties. That is our position. What is his position? He has had all of his Christmas to make up his mind about whether he would sign the treaty or not.

Last night—[ Interruption. ] This is very important, so let me explain. Last night at the meeting of the European Council, every European country had to say whether it would sign up to the treaty or not. Britain and the Czech Republic said we would not. Everyone has to make a decision, but the right hon. Gentleman cannot do so. He has had 53 days to make up his mind.

The right hon. Gentleman’s second problem is that he keeps saying this is an EU treaty, but it is not an EU treaty. There was a treaty of Maastricht, a treaty of Nice, a treaty of Amsterdam and a treaty of Lisbon. On each occasion, the Labour party was in favour. There will be no EU treaty of Brussels because we vetoed it.

The right hon. Gentleman asked specifically what effect this treaty could have on the EU single market. The treaty is clear. Article 2 states:

“The provisions of this Treaty shall apply”

only “insofar”—[ Interruption. ]

Mr Speaker: Order. The House must now calm itself. With all that gesticulation and hand-waving from the shadow Chancellor, I thought he was playing with his cooking utensils—[ Interruption. ] Well, he was pointing somewhere. Like the House and the country, I genuinely want to hear the Prime Minister, as I hope they also wanted to hear the Leader of the Opposition. Let us hear the Prime Minister.

The Prime Minister: Thank you, Mr Speaker. We know why the Opposition Benches are so depleted—Opposition Members have been eating the shadow Chancellor’s lasagne and are recovering. The point is absolutely clear in article 2, which states that the provisions

“shall not encroach upon the competences of the Union to act in the area of the economic union.”

The fact is that Labour always fails to stand up for Britain. That is what we know. The previous Labour Government gave away the EU rebate. What did they get in return? Nothing. They signed up to the bail-out mechanism. What did they get in return? [Hon. Members: “Nothing.”] They signed up to the social chapter. What did we get for that? [Hon. Members: “Nothing.”] The Opposition opposed our referendum lock, and even now they are telling us that Brussels does not have too much power, and that if the Leader of the Opposition were Prime Minister for long enough, he would join the single currency. He has had 53 days to make up his

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mind whether he wants to sign this treaty or not. As usual, he cannot make up his mind whether he is muddled or weak. The fact is he is both.

Several hon. Members rose

Mr Speaker: Order. There is enormous interest and I am keen to accommodate it. What is required is brevity, of which the right hon. and learned Member for North East Fife (Sir Menzies Campbell) is a past master.

Sir Menzies Campbell (North East Fife) (LD): We will see whether your prediction is justified, Mr Speaker.

I begin by praising the pragmatism of the Prime Minister, although I confess to being somewhat surprised that my support for it is not shared throughout the Government Benches. It is especially welcome that he pursued over the weekend a policy of re-engagement with our European partners, which is essential to his long-term objectives of the promotion of growth and the extension of the single market.

The Prime Minister: My right hon. and learned Friend is entirely right. We must ask a simple question: what is in the interests of the UK? It is in our interests to let the eurozone get on with the job of sorting out its problems, and to ensure that this new treaty is restricted to the issues of fiscal union. It is therefore in our interests to use leverage over the institutions and the legal issues to keep them focused on fiscal union. That is the approach we have taken and it is entirely right.

Mr Jack Straw (Blackburn) (Lab): Every single article bar one of the treaty, which I have read, refers to institutions of the European Union, including the Commission and the Court of Justice. Leaving aside its form, how can the Prime Minister possibly say that, in substance, the treaty is not equivalent to a European Union treaty? Given the provisions of article 12—it provides for non-euro contracting parties to participate in discussions on competitiveness, but not those outside the treaty—what has been achieved by his veto except that we are outside the door?

The Prime Minister: It is not an EU treaty, because it does not amend EU law; it is not a treaty within all of the treaties of the EU, and that is very important, because it would have been wrong to sign up for that without the safeguards for the single market, financial services and the other things that I set out. Let me just explain how important article 2 is in this agreement of the other countries. Let me read it in full:

“The provisions of this Treaty shall apply insofar as they are compatible with the Treaties on which the Union is founded and with European Union law. They shall not encroach upon the competences of the Union to act in the area of the economic union”—

that is, this treaty is outside EU law. Why is it outside EU law? It is because I made it outside EU law.

Mr William Cash (Stone) (Con): My right hon. Friend will know that the European Scrutiny Committee is making an inquiry into the nature and lawfulness of the agreement otherwise known as this non-EU treaty. Will he accept that the problem we have in European policy making is that it is on a slippery slope towards a more coercive, more federal and less democratic Europe? Will

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he give us his assurance that never, while he is Prime Minister, will we fold this non-EU treaty into the treaties as a whole?

The Prime Minister: To answer my hon. Friend’s second question first, obviously this treaty cannot be folded back into the EU without the agreement of every EU member state. We did not sign this treaty, because we did not get the safeguards that we wanted, and that position absolutely remains. My hon. Friend is right to make the point about the danger of a slippery slope that can be created by signing EU treaties and the use of the EU institutions. The whole point is that because this is not an EU treaty—because it is outside EU law—we are not in danger of that happening.

Chris Bryant (Rhondda) (Lab): So, basically, the Prime Minister was afraid that if he went to the European Court of Justice and asked the European Court of Justice whether the European Court of Justice should have power to adjudicate on the so-called non-EU treaty, he would lose? That is basically the sum and total of it, is it not?

The Prime Minister: Let me explain again, because I know the hon. Gentleman takes great interest in European affairs. The point is that it is in our interest that these eurozone countries get on with the job they need to do. It is absolutely important that they stick to the fiscal union and do not encroach on the single market. Clearly, there are uses for the institutions they have set out in this treaty, some of which are legal under existing EU law and some of which are highly questionable. We are going to use that leverage and that legal position to make them stick to the position of sticking to the fiscal union. That is the most sensible thing to do, and I would have thought that, with all his experience in European politics, he understood that.

Richard Ottaway (Croydon South) (Con): May I welcome the Prime Minister’s confirmation that there is no provision in the treaty that allows the single market to be undermined? However, he will be aware that the President of France has been driven to impose a financial transaction tax on France alone. Does he agree that the dismay with which that was met by the financial services sector in Paris illustrates exactly why such a tax is a bad idea?

The Prime Minister: One does not need to look any further than the European Commission itself, which actually carried out an investigation into a financial transactions tax and found that it could cost 500,000 jobs in the European Union. That is why the whole idea of pursuing this at the moment is completely wrong. Of course, it would be different if the whole world was going to accept a financial transactions tax, but that is extremely unlikely to happen. That is why I do not think it is the right approach. But let us be clear: in this country, we do get our financial services to make a proper contribution. For instance, we have stamp duty on share transactions, which actually raises considerably more than the French are planning to raise with their early foray into this area.

Mr Denis MacShane (Rotherham) (Lab): Will the Prime Minister confirm what I think the Chancellor has said over the past couple of days, which is that when more money is required by the IMF, Britain will not fall short?

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The Prime Minister: The Chancellor said that we are founder members of the IMF and strong supporters of it as an institution, but that the IMF must always lend to countries, not currencies; that we would not be part of an EU bail-out fund; that we would take part only if other countries came forward too; and that that would happen only after eurozone countries and eurozone institutions had done what they needed to do to stand up and support their currency. That is the position, and I think that it is right.

Mr Bernard Jenkin (Harwich and North Essex) (Con): Will the Prime Minister say something about the nature of the EU of which we are now a member, given that a subset of member states can bypass a veto and hijack the institutions for their own purposes without the consent of the dissenting member states? He is entirely right to maintain a reservation to ensure that that does not happen.

The Prime Minister: The point is that, as my hon. Friend knows, there are organisations within the EU, such as the eurozone group and the Schengen group, of which we are not a part, that use the European institutions. The fact is that this treaty is outside the EU treaties, which gives us that extra protection. Furthermore, we have the ability to exercise leverage to ensure that they stick to fiscal union, rather than getting into the single market, which is what we want to protect. That is absolutely important and the approach that we should take.

Ms Gisela Stuart (Birmingham, Edgbaston) (Lab): The Greek writer Aristophanes gave us the concept of cloud cuckoo land. I wonder whether some European leaders visited that mythical country on Monday. Will the Prime Minister tell us how on earth he thinks that a country such as Greece will regain competitiveness if it cannot devalue, which it cannot do within the euro?

The Prime Minister: The hon. Lady makes a serious point. I have read the agreement that these countries have come to, and I completely understand the need for fiscal discipline within the eurozone. Clearly, we cannot have countries building up excessive deficits year after year, and one can understand the concern of Germany and other northern countries, but on the text of the treaty, it is actually very concerning that some countries will struggle to meet it. Of course, Europe needs not only arrangements for fiscal discipline but, above all, arrangements for additional competitiveness, for opening up markets and for getting economies growing. That was the subject of the first half of the EU meeting, in which we were major participants, and we are very much driving that agenda to help Greece, Spain and other countries in the south of Europe.

Mr Andrew Tyrie (Chichester) (Con): The eurozone crisis has now become a major global risk, but the member countries seem wholly incapable of addressing it and its root causes properly. Will the need for IMF intervention and direction of the crisis be discussed at the G20 summit that the Prime Minister will be attending on 25 February, and was it discussed at the summit from which he has just come?

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The Prime Minister: There was not a discussion about IMF resources at the informal EU Council. To be fair to eurozone members, what they need to do is difficult for countries to do: they need to contribute huge amounts of money to a firewall to prevent contagion; they need to put capital into their banks to strengthen them at this time of stress; and they have to give up large areas of sovereignty to make sense of the eurozone. Those are all reasons we stayed out of the eurozone, and why I believe that we should not join the single currency. It is only fair, however, to explain that they have taken quite a few steps down that road. The argument that I made in Davos was that, as well as the short-term things that they need to do, they need a set-up that makes sense for the long term of the eurozone.

Mike Gapes (Ilford South) (Lab/Co-op): The Prime Minister said that he will watch closely and, if necessary, take action, including legal action, if our national interests are threatened by the treaty. Will that legal action be taken through the European Court of Justice, and how does that marry with his next statement that EU institutions should only act with the explicit authorisation of all member states? Will not other states refuse to allow that?

The Prime Minister: I do not think that the hon. Gentleman understands how these institutions work. The point is simple: it is clearly in our national interests to maintain the single market at the level of the 27 to make it work for us. As long as this treaty stays out of that area, and instead focuses on fiscal union and discusses the things that the hon. Member for Birmingham, Edgbaston (Ms Stuart) mentioned, it will not be a problem for Britain. If it encroaches on our national interests, however, we will have the ability to take action and the case to do so.

Simon Hughes (Bermondsey and Old Southwark) (LD): After what was clearly a much more successful and satisfactory summit than the one in December—the Prime Minister came back with clear EU commitments to democracy around the world, and to the single market and the extra jobs that it can sustain, particularly in the energy industry at home—will he agree that his constituents, like mine, want the Government to concentrate, as Europe appears to be united in doing, on jobs, growth, training and skills, instead of obsessing about constitutional and treaty niceties? Those are not important.

The Prime Minister: I think the right hon. Gentleman is entirely right, and the refreshing thing about this Council is how much time was spent on the nitty-gritty of the single market—on digital, on services, on education and on energy markets. Having Mario Monti, the new Greek Prime Minister and others there with a real focus on the single market, including the new Spanish Prime Minister, gives us a much better prospect for making progress on this agenda than we have had for many years.

Mr Dennis Skinner (Bolsover) (Lab): Is not the truth of the matter that throughout 2011 the Prime Minister marched his troops to the top of the anti-European hill, and now, like John Major before him, and with the help of the Deputy Prime Minister, he has marched them down again? I think there is a word for it: it is called

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appeasement. If this meeting had been held in Munich, the Prime Minister would have been coming back waving a piece of paper.

The Prime Minister: I always wonder whether practice is going to make perfect with the hon. Gentleman. At least he has been consistent: he has always voted against all EU treaties, and I am giving him the rare pleasure of not having an EU treaty to vote against.

Harriett Baldwin (West Worcestershire) (Con): The Prime Minister has referred to the five European countries that are now less competitive than Iran. On competitiveness, his announcement today is welcome, but how quickly will those steps be taken to increase the competitiveness of the single market?

The Prime Minister: My hon. Friend is entirely right to raise the issue in this way. We have tended in the past in the European Union to sign up to Council conclusions or informal statements, like the one agreed late last night, that are full of good words about taking such steps but do not contain enough concrete dates. The difference last night is that dates have started to appear for when specific things should be done, whether it be completing EU free trade arrangements with other countries or completing deregulation or single market programmes. That is very welcome.

Keith Vaz (Leicester East) (Lab): The position taken on Iran at the summit was clearly the right one. However, as the Prime Minister knows, there are 73,000 Iranians living in London. What provisions have been made to nominate a third country, so that British Iranians can go to visit Tehran, and their friends and relatives can come and visit here?

The Prime Minister: The right hon. Gentleman asks an important question. Perhaps I can write to him about that. What I would say is that, in a move that may have surprised some people, the EU has been decisive—for instance, in creating the oil embargo when some members of the EU have been quite reliant on Iranian oil, which is a real step forward. However, on the issue of third countries and travel, perhaps I can write to the right hon. Gentleman.

David T. C. Davies (Monmouth) (Con): We have learned today that in Britain’s national interest the Prime Minister is prepared to use a veto to allow national agreements and to rule out for ever Britain’s membership of the euro. Does he or anyone else in this room have any idea what the Leader of the Opposition stands for?

The Prime Minister: It is going to be interesting. We are now going to have a period of days when the Leader of the Opposition is finally going to have to get off the fence and tell us: would he sign up to this treaty or not? The treaty is right here—I can give him a copy. It is a treaty that we will not be signing; he now has to make up his mind whether he is going to sign it or not.

Kate Hoey (Vauxhall) (Lab): How does the Prime Minister feel about attending a European Council of a supposedly democratic EU when the leaders of two of the countries not only have not been elected, but were

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more or less imposed by the bureaucracy in Brussels? Does he not feel seriously that we are moving more and more away from a democratic Europe, and that this is why the people of this country, ultimately, will have to decide on our future?

The Prime Minister: The difference between the situation in this country, where we face great economic challenges, and countries in the eurozone is that we have been able to adopt a policy stance that, yes, combines a very tight fiscal policy with difficult public spending reductions, but can also be accompanied by a loose monetary policy, with the Bank of England standing behind the economy. The problem for many eurozone countries is that they do not have that policy mix. That is making life difficult for them, and I fully understand that. They want to stay in the euro; they want to make the euro work. Whatever our private views about the euro, we should do what we can to help them get on with the job of sorting out the single currency and its arrangements, because it is currently having such a bad effect on our economy.

Andrea Leadsom (South Northamptonshire) (Con): Can the Prime Minister reassure the House that in exercising his veto, exhorting the eurozone to sort out its financial crisis and promoting growth through the single market, he is acting in Britain’s national interests? Does he also share my concern that the Leader of the Opposition does not seem to know where Britain’s interests lie?

The Prime Minister: My hon. Friend is right. At the end of the day, we have to decide whether we are going to agree to this treaty or not. The fact is that every European country had to make that decision, and we have made ours. I repeat that it is in our national interest for the eurozone to deal with its problems, to keep this treaty focused on fiscal union and then to maximise the potential of the single market. I think that Britain should be relaxed about being in those parts of Europe where we want action—just as we are a leading member of NATO, and just as we led that action in Libya—but that we should quite happily stay out of areas that we do not feel are in our interests, such as the Schengen no-borders agreement or the euro.

Mr Ben Bradshaw (Exeter) (Lab): Given that Germany grew 3% last year, and has its lowest unemployment for 20 years and more manufacturing and a smaller pay gap than Britain, why is the Prime Minister so against the practice of worker representation on company boards?

The Prime Minister: One of the points about Germany is that it did not spend the last decade making its economy unbalanced with a massive boom and a massive bust. The right hon. Gentleman is right to raise the IMF forecasts, however, because they are very instructive about what is happening in Europe this year. They are actually forecasting higher growth for Britain than for almost any other country in the European Union, but they have made very chilling forecasts for countries such as Spain and Italy, for which they are forecasting quite a steep decline.

Mark Reckless (Rochester and Strood) (Con): Will the Prime Minister explain what it is that he has vetoed?

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The Prime Minister: I have vetoed Britain’s involvement in a treaty. As a result, it is not an EU treaty. We had in front of this House the Maastricht EU treaty and the Lisbon EU treaty; we had Amsterdam and we had Nice. All of those were treaties that Britain was involved in as a member of the EU, and they were EU treaties with the full force of the law. This is not like that; this is outside the European Union. It is an arrangement that has been reached by 25 other countries and we are not involved. As a result, we have safeguarded Britain’s interests, which could have been put at risk by a new EU treaty.

Mr Nigel Dodds (Belfast North) (DUP): What indications did the Prime Minister receive from the German Government that if they want their political project of fiscal and monetary union in the eurozone to succeed, they will finally have to face the sad fact that they will have to put in the necessary resources, rather than just imposing greater austerity on countries that have been steadily stripped of their democracy?

The Prime Minister: I tried to set out what I think is the sensible view in my speech to the Davos summit. Look, I do understand the German concern. It sees countries across Europe that have run up huge debts and huge deficits, putting at risk the stability of the single currency. It does not want that to happen again, so it wants these assurances for the future. Just as everyone needs to understand the German position, however, we also need to show some understanding of those countries that are going to struggle in the years ahead. They are going to need extra help and assistance, and there is going to have to be solidarity across the eurozone, because the single currency requires that, as I explained in my Davos speech. We manage a single currency across the United Kingdom because we show solidarity with different areas of the country, and the eurozone has to understand that similar solidarity will be required there, to make the single currency work in the long run.

Mr Robert Buckland (South Swindon) (Con): I was encouraged to see reference in the communiqué to this year being a decisive year for free trade agreements. Will my right hon. Friend do all that he can to move ahead with the free trade agreement with Japan, which is vital to large parts of our motor manufacturing industry?

The Prime Minister: I will certainly do that. I have discussed this issue with the Japanese Prime Minister and with the European Union. One of the issues with Japan is non-tariff barriers, in regard to the access to Japanese markets that British goods and services want. There is a particular advantage for us, in an economy with such a high level of services and branded goods, in ensuring that we really secure progress on the free trade agreement, not only with Japan but with India. The Indian economy is fairly closed off to services, and we want to see it opened up.

Sir Stuart Bell (Middlesbrough) (Lab): The Prime Minister has talked about competitiveness, growth and jobs, but he skated over the fiscal compact and its fiscal consolidation, which could have a severe effect on jobs and growth. Further to the question from my right hon. Friend the Member for Blackburn (Mr Straw), and given that the Prime Minister thinks the eurozone is so important to us, what influence does he think he can bring to bear, as he is not part of the 25?

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The Prime Minister: The hon. Gentleman seems to be having his cake and eating it. On the one hand, he says that the treaty is tough in terms of fiscal discipline and consolidation, while on the other hand he is worried about the fact that we have not signed it and are not subject to it. I think it is right for this country to take measures to consolidate our fiscal position. These are difficult measures, but we can at least look the British people in the eye and say we are doing it for our own benefit and our own good. We are not doing it because we are instructed by some foreign body to get our budget under control; we are doing it in our own national interest.

Mr Richard Shepherd (Aldridge-Brownhills) (Con): The Prime Minister will well remember that nearly 20 years ago, the United Kingdom, Italy, Spain and the Irish Republic left the exchange rate mechanism—the precursor of the euro. There was an exit strategy. Now the crisis facing Europe seems to be one of solvency in some of these countries, there is no exit strategy and it appears that there is no money. Will the Prime Minister reassure the British public that no funds will be given to the IMF and that we will give no more money to the European Union?

The Prime Minister: I obviously remember very well the exchange rate mechanism experience. Indeed, it is that experience that makes me so passionate about not joining the single currency or the euro—because it is so difficult to exit from it if it does suit our needs or our arrangements. I believe that Britain is a big enough economy to have its own interest rates and its own monetary policy to suit our needs. My hon. Friend asks for guarantees. What we have done is already to have got out of the bail-out mechanism to which the last Government signed us up and, as I clarified a few moments ago, we have set out very clearly our conditions to the IMF.

Barry Gardiner (Brent North) (Lab): The Prime Minister says that his veto has left the European Commission in the room to protect against encroachment on single market issues and competitiveness. Will he remind us of the name of the noble baroness who represents the UK on that Commission and of which party will therefore represent Britain’s last line of defence?

The Prime Minister: The point the hon. Gentleman has clearly not understood is that the treaty itself sets out that the treaty cannot be used to encroach on the single market; it is there in black and white. As I have said, if that is not the case we have the ability to take action, including legal action, to protect our national interest.

Sarah Newton (Truro and Falmouth) (Con): My constituents really appreciate the Prime Minister’s straight talking on this issue, so will he answer the question that they want answering: if asked, will the Prime Minister stump up more money for Greece?

The Prime Minister: Our answer is very clear. We were not involved in the Greek bail-out, and we will not be involved in European bail-outs of Greece. We have got out of the EU mechanism that the last Government got us into, and we have set out our conditions on the IMF very clearly.

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Kelvin Hopkins (Luton North) (Lab): In the last few days, the Greek Government have said that they refuse to have their economic governance taken over by the European Union. Does the Prime Minister support the Greeks in that, and if so, will he say so here and now?

The Prime Minister: The only way I can answer that question is to say that the Greeks have to decide themselves whether they want to stay in the euro. If they do, they have clearly got to meet some pretty exacting targets for reducing Government deficit, reducing Government debt and accepting a very austere approach. If Greece wants to stay in the euro, those are the conditions it will have to meet. I am not Greek; I am British. We have made our decision to stay out of the euro; this is their decision, and we should not tell them what to do.

Nicholas Soames (Mid Sussex) (Con): It is clear that the Prime Minister has considerable support within Europe in seeking a more adaptable, flexible and competitive economy. Will he reassure businesses in my constituency and elsewhere that the casting of the veto will have done nothing to prevent his ability to drive forward that agenda in Europe?

The Prime Minister: What last night’s meeting proved is that there is a very strong and growing consensus for action around the European Council table on issues of competitiveness. British Ministers—and, to be fair to Labour, British Ministers for the last 20 years—have been going to Europe arguing for completing the single market, deregulation, lifting the burdens on business and all those issues, and we have always had strong supporters in the northern liberal countries, as it were, but we have come unstuck when it comes to other countries. I think we now see—partly because the centre right is in power in so much of Europe—really strong support for that sort of agenda, and we can certainly drive it forward.

Stewart Hosie (Dundee East) (SNP): The Joint Ministerial Committee memorandum of understanding on EU policy says that Ministers and officials from all the devolved Administrations should be involved in discussion with the UK Government on the formulation of UK policy. What discussions did the Prime Minister or his officials have with Edinburgh, Cardiff and Belfast before the European Council meeting?

The Prime Minister: As the hon. Gentleman knows, there are arrangements for these things. Actually, the Government have been very generous in ensuring that the Scottish Administration have been fully involved in, for instance, fishing quota negotiations. However, I thought that the hon. Gentleman wanted to leave the UK altogether. If that is the case, he will have to seek access to the European Union, and seek access to joining the euro as well. I think that he ought to read the treaty and work out whether he wants to sign it. Perhaps when he has made up his mind he will be able to tell the Labour leader what to do.

Mr Edward Leigh (Gainsborough) (Con): The Prime Minister said this afternoon that, if necessary, we would take legal action. What would trigger that legal action? Is not the problem for the majority the fact that if they stretch the European institutions to achieve greater compliance, the minority may be tempted to stretch them to achieve greater independence?

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The Prime Minister: I think that the conditions are very straightforward. As I have said, we want those institutions to sort out the problems of the European Union, and we want them to stick to fiscal union and not go into single market issues. If they were to go into single market issues and threaten Britain’s national interests, of course we would act. That seems to me to be a much more sensible approach than taking an alternative path, because all the while we shall be maintaining some leverage over this organisation, outside the European Union, to ensure that it sticks to the job that it is meant to do.

Nic Dakin (Scunthorpe) (Lab): What, in terms of content, is not in the EU treaty as a result of the Prime Minister’s not signing it?

The Prime Minister: I do not know whether the hon. Gentleman has spotted this yet, but there is not an EU treaty.

Mr John Baron (Basildon and Billericay) (Con): The Prime Minister will be aware that the latest report on Iran by the International Atomic Energy Authority contains no smoking gun whatsoever. Given that the sabre-rattling and sanctions from the west have served only to strengthen the position of the hardliners, and—as is illustrated by the fact that Iran is thinking of bringing forward the deadline for the oil embargo—have failed to date, is this not the time for a fresh approach, which should include ruling out the option of force?

The Prime Minister: I listened carefully to my hon. Friend’s question, and indeed I listened to him carefully when he made the same case on the radio this morning, I do not read the IAEA report in the same way as he does, and I do not altogether trust Iran’s motives in this area, but the easiest way for Iran to settle the issue is to open up and show everyone just what it is doing. If it is only pursuing nuclear power and is not pursuing nuclear weaponry, the world will be able to move on, but until those assurances are given, the world will not be able to move on. That is the reason for the tough action that we are taking, which shows that there are alternatives to military force. We want to ensure that we maximise the use of all those options before considering anything else.

Mr Wayne David (Caerphilly) (Lab): Will the Prime Minister explain the difference between a veto and an opt-out?

The Prime Minister: There is a very important difference. Let us consider what happened with Maastricht, for instance. There was a European Union treaty to which Britain was a full signatory. We opted out of certain parts of it, but we were still subject to a huge amount of additional EU law. That is why there were so many agonised debates in the House about whether it was a good thing or a bad thing. The same can be said of all EU treaties. The difference in this case is that there is no EU treaty. We are not going to put something in front of the House, and nothing will be voted on, so it will not affect the UK.

Steve Baker (Wycombe) (Con): May I draw my right hon. Friend’s attention to the initiative for a free and prosperous Europe which was launched yesterday with the support of think-tanks and non-governmental

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organisations across the continent? In a nutshell, it asked the EU to stop centralising power, and instead to build prosperity on liberty and responsibility. There is an appetite throughout Europe for the kind of policies that my right hon. Friend’s Government are advocating. Does he share my hope that the leaders of the European nations may abandon their outdated ideology of centralisation and follow him instead?

The Prime Minister: I am grateful to my hon. Friend for his comments, and I will certainly look at the report he mentions. We in this House must understand that 17 members of the European Union have opted for a single currency—that was the big moment, when different parts of Europe chose to take a slightly different path—and even in spite of the difficulties, those member states are fully committed to trying to make it work. We have to respect the view they have taken and allow them to go on and do some of the things that can make sense of the eurozone. It is not the choice that we are making; we are making a different choice. We want a competitive Europe, we want a trading Europe, we want an open Europe, but we do not want a more centralised Europe, and not signing this treaty—not having an EU treaty—helps us down that path.

Jeremy Corbyn (Islington North) (Lab): When the Ministers discussed the situation in Iran, was any concern expressed about the bombings and assassinations currently taking place and the military build-up in the area, which clearly leads to much greater tension? Will the Prime Minister think again about the suggestion of the hon. Member for Basildon and Billericay (Mr Baron) that there should be a renewed diplomatic initiative by either Britain or the European Union to try to build relations with all the power structures in Iran, rather than head down this very dangerous road towards a war?

The Prime Minister: I am afraid I do not agree with the hon. Gentleman for this—reasonable, I hope—reason: Iran has been offered a normal diplomatic relationship. Indeed, it was offered many times by the right hon. Member for Blackburn (Mr Straw) when he was Foreign Secretary. The fact is that that did not move Iran off the path of trying to acquire all it needs for nuclear weapons. So I think the path of sanctions, travel bans and asset freezes, and all the tough measures we are taking right across the EU, is the right path. It is the right alternative to the alternatives that I think the hon. Gentleman does not welcome, and hopefully it will make the Iranian regime change its strategy.

Mrs Anne Main (St Albans) (Con): In December, the Minister for Europe said in response to my right hon. Friend the Member for Wokingham (Mr Redwood) that

“we understand why those countries want to use the institutions, but it is new territory and raises important issues that we will need to explore with our colleagues in those other European countries.”—[Official Report, 13 December 2011; Vol. 537, c. 718.]

Further, today my right hon. Friend the Prime Minister has said there are legal implications as a result of the discussions he has had. Does he share my concern that by invoking the institutions we may well end up in a Jarndyce v. Jarndyce-type legal squabble with the European Court of Justice that will not go in our favour?

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The Prime Minister: That is not my concern; instead, my concern is that although there are uses of the EU institutions that are already sanctioned by existing treaties and to which we could not possibly object, this agreement between the 25 countries goes further than that and raises legal concerns. So we are right to raise them and use the leverage to try to keep this new organisation on the straight and narrow path of fiscal union rather than moving over into the single currency. I do not really fear what my hon. Friend says, because of course people can take cases about what has been signed to the European Court, but that is not going to drag Britain into a treaty that we are not part of. That is another advantage of not having signed the treaty.

Graham Stringer (Blackley and Broughton) (Lab): The Prime Minister was right to veto the treaty because it was against this country’s interests. The agreement arrived at between the 25 countries is fundamentally deflationary and will not lead to growth—it will lead to mass unemployment across Europe—and is also against this country’s interests. Rather than reneging on his original commitment to stop the 25 using European institutions, should not the Prime Minister now be using all the power of his office to stop them?

The Prime Minister: I am grateful to the hon. Gentleman, as at least we have at last got a clear Labour view. Clearly he, like me, would not have signed the treaty and thinks Britain is better off outside the treaty.Is that the Labour position? The Leader of the Opposition can just nod. That is not much to ask for. They have had 53 days to make up their minds. There are three options: yes, no or “I don’t know because I’m weak and indecisive.”

Jessica Lee (Erewash) (Con): I welcome the reduction in regulation on small and medium-sized enterprises set out in the statement. Will my right hon. Friend reassure the constituents of Erewash that the priority throughout negotiations is the protection of jobs and businesses in Britain?

The Prime Minister: That is absolutely our priority. The more we can get the single market to work, the better it will be for British jobs, including in Derbyshire. There is an important agenda here, and it is not just about getting the European Commission and European Union to do things in terms of completing the single market. It is also, sometimes, about trying to get them not to do things—it is about rolling back some of the bureaucracy that has been placed on business that can cost jobs and mean extra regulation.

Mr William Bain (Glasgow North East) (Lab): Figures released by the EU today reveal that one in 10 people in the EU is out of work, including 16 million people within the eurozone. Why has the Prime Minister not been more vocal about an increased role for the European Central Bank, including the use of eurobonds to help restore confidence to the markets and increase growth?

The Prime Minister: I always think it is the first sign of madness for a politician to say, “Please go and read one of my speeches,” but on this occasion I will make an exception. If the hon. Gentleman reads my speech at the Davos summit, he will see that that is exactly what I said.

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Chris Bryant: So, you’re mad?

The Prime Minister: Thank you very much—you are so charitable.

On unemployment, the hon. Member for Glasgow North East (Mr Bain) is absolutely right. There was a very good and strong discussion in the European Council and it is really worth looking in particular at examples of countries that have lower youth unemployment than Britain—there are many with higher youth unemployment —to see what lessons we can learn from them.

Dr Julian Lewis (New Forest East) (Con): Does the Prime Minister agree that the question of European bail-outs would be much less likely to arise if different countries with different economies had different currencies? Will he therefore recommend this tried-and-tested model for the eurozone countries?

The Prime Minister: We have a very strong view in this country that we should keep our own currency, but that does not let us off the need for fiscal discipline, proper monetary policy and keeping inflation under control. It is not a free lunch or a free ride. We have to take tough decisions, but clearly we have to show some respect for the 17 eurozone countries that want to make the euro work. It is no good wishing away what is there. The responsible thing to do is not to stand in their way when they are trying to put out the fire in their own house, but to ensure that they do so in a way that does not threaten our national interests. That is exactly what I have done.

Bill Esterson (Sefton Central) (Lab): I still do not know whether the Prime Minister thinks that he did not sign a treaty or just an agreement. Is not his real failure his commitment to austerity and his lack of a plan for jobs and growth either in the EU or in the UK?

The Prime Minister: In Europe, we have a plan for jobs and growth, which is called completing the single market. The question that the hon. Gentleman and his leader have to answer is about the new treaty being proposed, which 25 countries are going to sign and Britain is not. [ Interruption. ] I do not care how bad the lasagne is, at some stage the shadow Chancellor and the Leader of the Opposition are going to have to make up their minds. Are they for it, are they against it, or are they weak and indecisive and cannot make up their minds?

George Eustice (Camborne and Redruth) (Con): Like many others, I welcome the commitment to cut the burden of regulation, but does the Prime Minister agree that there could be potential to revisit the way in which directives were transcribed into UK law by the previous Labour Government, with a view to removing some of the gold-plating that businesses complain about so much?

The Prime Minister: My hon. Friend makes a very good point. There have been occasions on which EU directives have been added to by Government Departments and implemented with more vigour than in other parts of the European Union. We have tried to put a stop to that under this Government.

Chris Bryant: Name one.