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Westminster Hall

Wednesday 29 February 2012

[Albert Owen in the Chair]

Trade Union Funding

Motion made, and Question proposed, That the sitting be now adjourned.—(Bill Wiggin.)

9.30 am

Fiona Bruce (Congleton) (Con): It is a pleasure to speak under your chairmanship, Mr Owen, and a privilege to introduce this debate. In doing so, may I, as someone who comes from a northern mill town, where my grandmother started weaving in the cotton mill as a young girl and lost much of her education as a result, acknowledge the historic role that trade unions have played in our country throughout the past century in improving and defending workers’ rights? They are worthy of our respect. I acknowledge too the important role that they still play today as a valuable part of our civic society in supporting and advocating workers’ rights and representation.

The debate is not about criticising the work to which I have referred, but about the promotion of transparency, accountability and fairness in the way in which such work is fulfilled—things that I hope we would all agree it is right to promote in public and civic life. It is about ensuring that the right balance is found between effective representation of trade union members and value for money for the taxpayer. Many of us believe that, at the moment, the balance disproportionately disadvantages the taxpayer.

Mr Gerry Sutcliffe (Bradford South) (Lab): On that point, will the hon. Lady give way?

Fiona Bruce: I will give way and I am happy to take interventions, but perhaps, in the interests of transparency, the hon. Gentleman will first say which trade union he is a member of and how much money that union has given to his constituency Labour party in the past three years.

Mr Sutcliffe: You would not allow me to do that, Mr Owen, on the basis that interventions must be brief, but I will write to the hon. Lady with all the information that she has requested, because I am proud to be a member of a number of trade unions. In the calculation that she has made in relation to transparency and the balance being wrong, how much weight has she put on the amount of work that unions do to help employers to have good industrial relations?

Fiona Bruce: I have already recognised the positive work that trade unions do. We are simply saying that it is unfair that taxpayers should have to shoulder the burden of the cost of that work to the degree that they do, particularly when so many of those taxpayers and council tax payers have no connection with the work of those unions.

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John Healey (Wentworth and Dearne) (Lab): On that point, will the hon. Lady give way?

Fiona Bruce: I will, but I repeat the question that I asked earlier.

John Healey: Will the hon. Lady not accept that the facts show that where a trade union is involved with an employer, fewer days are lost through illness and injury and there are fewer employment tribunal cases and that there are, therefore, cost savings to the human resources function and the organisation, which are clearly benefits to the employer? If that is the case, is it not right to accept that the employer should bear some of the cost of the work that union representatives do for their work colleagues and for their employer and their organisation?

Fiona Bruce: We are saying that the cost is wholly disproportionate. Millions of pounds a year of taxpayers’ money are being used to fund this activity. I have said that much of the activity is worth while, but much of it veers towards being, if not is, political. During the past 13 years of the—

John Healey: Will the hon. Lady give way?

Fiona Bruce: No. [Interruption.] May I please give my speech, Mr Owen? [ Interruption. ]

Albert Owen (in the Chair): Order. I call Fiona Bruce.

Fiona Bruce: Thank you, Mr Owen. During the 13 years of the Labour Government, the Government were funded to the tune of £10 million a year by the unions in political work. We think that that is wrong.

Several hon. Members rose

Fiona Bruce: I shall continue, if I may, because I have hardly embarked on my speech and I know that many other hon. Members wish to contribute to the debate.

I have acknowledged the good work that trade unions do. My concerns about union funding and financial support stem from my time as a councillor in Warrington. In 2006, when Labour lost control of the council and a joint Conservative and Liberal administration took over, I was allocated a portfolio with the title “Value for Money”, later augmented to the finance portfolio as a whole. One action that I undertook was to review all the property assets of the council to see where efficiency savings could be made and where, at a time of increasing pressure on our services, better value for money could be delivered for our council tax payers. I am talking about money being allocated to front-line services. We analysed every building and piece of land that the council owned—that had never been done before—and drew up plans to ensure that their use and value was in the best interests of residents. The use of some buildings was increased. For some buildings, joint use was the way forward. Rents were reviewed where appropriate. Some properties were repaired. Others were released for sale, so that the funds on disposal could be utilised more effectively for the benefit of residents.

To my surprise, I discovered that one of the authority’s most prestigious properties, part of a wing of the town hall itself—undoubtedly the most prestigious listed building

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in the town, in the prime commercial letting area—was occupied rent free, and with services free, by local union representatives, at considerable cost to local council tax payers.

Ian Lavery (Wansbeck) (Lab): Will the hon. Lady give way on that point?

Fiona Bruce: No, I shall continue with my speech, if I may. In the interests of transparency, which I mentioned earlier, I would have liked to obtain the definitive figures for that cost, but I was never able to do so. I did, on a number of occasions, ask that use of the asset be reviewed, but I could never get council officers even to consider reviewing the use of that asset in the same way as the use of every other property asset in the town was being reviewed, while all the time local community groups, charities, small business owners and others were seeing their charges for and use of property reviewed. The fact that property used by trade union representatives was exempt from that process struck me as simply unjust.

The value of the use of that asset—prime commercial property—when multiplied over many years, must have amounted to thousands of pounds. That money could have been used to keep down the costs of renting local community halls by youth groups, guides and scouts and mum and tots, and for other front-line services in a town where many residents are by no means affluent. I am sure that few, if any, council tax payers in Warrington knew that their money was being spent in that way, and that had they known and had they realised the amounts involved, they would have been as surprised as I was. It is interesting to note that if I, as Member of Parliament for Congleton, wanted to hold my surgery in the town hall, I would be required to pay a charge.

Therefore, when I heard about the Trade Union Reform Campaign, which was founded to reform the laws and funding arrangements relating to trade unions and so to create a more level playing field, I was pleased to support it and become a council member, together with many other hon. Members who are here today and will speak after me to raise concerns in addition to the one that I have highlighted—the use of council facilities. In supporting the campaign, I am pleased to note that we are in good company. My right hon. Friend the Prime Minister himself is backing the campaign and wrote in November—[Interruption.] He wrote in November to its chairman, my hon. Friend the Member for Cannock Chase (Mr Burley), to whom I pay tribute for standing up and spearheading this campaign. The Prime Minister wrote:

“I am pleased that you have decided to establish the Trade Union Reform Campaign…as I strongly believe the current level of public subsidy to the trade unions cannot be sustained, either morally or economically…at a time when across the private and public sectors people are having to take very difficult decisions in order to save money, it is difficult to justify some people in the public sector being paid not to do the job they are employed for, but instead to undertake full time trade union activities—much of which should be funded by the unions themselves. We need to question why the public is paying for so much, and whether this is sustainable going forward.”

That is what we are doing today. Hard-working taxpayers, particularly in these challenging economic times, deserve to see Government, at local and national level, stewarding

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people’s money responsibly and doing all that they can to maximise its use, so that as much as possible can go to the front line, for those most in need. I am talking about stewarding people’s money responsibly and ensuring transparency, accountability and fairness.

I do not want to pre-empt what others will say, but I do want to draw attention to the excellent contribution my hon. Friend the Member for Cannock Chase made in his Adjournment debate on 26 October 2011, when he gave many clear examples and staggering figures. He drew the attention of the House to the issue and to the need for reform based on the principle that the activities that people undertake on behalf of trade unions should be funded by those trade unions and not by the taxpayer. Why should taxpayers pay for that work?

People pay council tax to have their bins emptied and their streets cleaned. Councils across the country are making every effort to keep council tax frozen, and the Government are making every effort to pay off Labour’s deficit. At this time, more than ever, it is right that we ask the questions I have posed.

I applaud Swindon council, which has recently taken steps to review the issue. It has removed the shared job of two union representatives as part of a £15 million reduction. Councillors who met to finalise the council’s budget said they should not have to pay their staff to do union work in the current economic climate.

Colleagues who follow me will have many questions for the Minister, but I would be grateful if he would give us guidance on how town halls up and down the country can challenge union representatives’ use of facilities that would be better utilised for the benefit of the community. In the light of the excellent contribution my hon. Friend the Member for Cannock Chase made in his earlier debate, will the Minister also update us on the progress of Government action to deal with the concerns my hon. Friend raised? I had intended to repeat them, but I will not, because so many other Members want to speak.

9.41 am

Mr Frank Doran (Aberdeen North) (Lab): I am proud to answer the question from the hon. Member for Congleton (Fiona Bruce): I am a member of the GMB union, and, yes, it has helped to fund my election campaigns. I hope it will do the same in the future, just as the businesses the hon. Lady supports are likely to support her directly or through some other medium.

The hon. Lady’s comments emphasised one of the major problems in our political system. When a party is elected, it rips up what the previous party did, and we can see the consequences of that in all sorts of areas. One section of the Tory party—it is much larger than it used to be—is focusing particularly on trade union rights. It thinks the only way we will sort out our economic and political system is by removing workers’ rights to health and safety protection at work because such things are all red tape. That is why the Tories have formed their Trade Union Reform Campaign, in the same way they formed the TaxPayers Alliance as a front and a seemingly independent organisation to get over their message and alter the debate on public finances.

I want to focus a little on how things should be. When we look at our economic competitors, it is clear that we are not at the races. Our manufacturing industry has

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virtually disappeared, although that is the fault of both the Labour and the Conservative parties, and I am not laying political blame. However, there are fundamental weaknesses in the way we approach industrial relations.

I was a Parliamentary Private Secretary—the lowest of the low—in the Department for Trade and Industry when Labour was elected in 1997, after 18 years out of office. One of the key issues on which we had manifesto commitments and which we wanted to tackle was the industrial relations system. Rather than taking the approach of the hon. Lady and most of her colleagues in the Conservative party, we decided to trust the trade unions and management. We asked the CBI and the TUC to go away and look at what we proposed in our manifesto programme, and then to go beyond it and look at a range of issues that we felt were a serious problem in our industrial relations system. There was not a lot of confidence that they would come back with a workable programme, but we were quite explicit: we told them to come back and tell us what they could agree about, what they did not agree about, but thought they could sort out, and what they positively disagreed about.

I remember sitting in the office of the Secretary of State, my right hon. Friend the Member for Derby South (Margaret Beckett), when the TUC and the CBI came back to report on what they had worked out. We were all astonished, because they had gone much further than we had anticipated. Both sides knew the industrial landscape and the workplace, and they knew how the system worked. They came back with a formula that eventually became the Employment Relations Act 1999. The focus of that Act was not, as the hon. Lady might suggest, about Labour buying off its union funders: it was a serious attempt to change the industrial landscape. One of the key issues was to try to get the courts out of industrial relations, and I think we succeeded enormously in that respect. I am very proud of what we did in that area.

One of the key areas of conflict was recognition. We introduced a process that enabled recognition to be properly worked through in the workplace or with support from ACAS. That meant that we had a rational debate, rather than both sides following their first instinct and rushing to the courts to try to force things through.

Within a few months of the Act—in fact, the process started before it was enacted—we had more than 1,000 new workplace agreements. Management decided to sit down with their workplace unions for the first time, and they started to enter agreements. There have been virtually no disputes since, although there have been one or two high-profile ones. In the main, however, the whole issue of industrial disputes over recognition has disappeared.

Sadly, we now have a new Government. Just this week, I met a group of trade union officials who represent the trade unions at QinetiQ, where the managing director, who has no experience of the defence industry or science, has decided that recognition will be removed from the workplace. That will be an area of conflict, and it is completely unnecessary. There was no proper consultation with unions: in fact, in that case, unions at the national level feel they have been deceived and lied to, and such comments are not made lightly in an industrial context.

Bob Stewart (Beckenham) (Con): I am totally in support of having unions, and it is a statutory right for unions to carry out their business unpaid in work time.

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However, I am worried, and I wonder whether the hon. Gentleman agrees in principle with union members being paid out of taxpayers’ money. That is the crux of the worry many people have.

Mr Doran: A whole phalanx of my colleagues will come in on that issue, but I want to focus on the issue I have outlined. To answer the hon. Gentleman’s question, however, I see this arrangement as a facility for management. In my constituency, which does not have a Labour council at the moment, staff are paid to do this work because it is a door for management to knock on when there is a problem. Whenever there is a difficulty, the two sides can quickly get together, and the people who represent the work force can talk with some authority; they do not have to work at the coal face in another job and then have to be briefed on an issue that has come up somewhere in another department. These things happen in the private sector as much as in the public sector because they are good for management—they oil the wheels.

Mr Michael McCann (East Kilbride, Strathaven and Lesmahagow) (Lab): Does that point not sum up the fundamental flaw in the contributions of the hon. Members for Congleton (Fiona Bruce) and for Beckenham (Bob Stewart)? This is not about trade union facilities, but about the time given to fulfil industrial relation duties. The time used by trade union representatives is, in fact, tiny in relation to their own particular work, and the vast majority is used to ensure that the workplace works smoothly. That is where Tory Members are getting this very wrong.

Mr Doran: My hon. Friend speaks with a lot of experience. He has worked with local authorities across Scotland, and I bow to his knowledge. It is easy to count the cost of wages. The Secretary of State for Communities and Local Government, who has an axe to grind, has all the resources to get the figures together; but there is no assessment of the benefit to management. That is the fundamental weakness in the case.

The pendulum is swinging. I have described how we approached industrial relations, and the figures for time lost at work through strike action in the past 15 years show a dramatic improvement, but that graph is likely to change substantially. I am deeply concerned about the approach of any Government who think that the only way to resolve problems in the workplace is to reduce workers’ rights and remove their health and safety rights. That is a particular issue for me. I was a very young Member of Parliament when the Piper Alpha disaster happened. It was a time of light regulation in the offshore oil industry, because the imperative was to get the oil ashore and recover the taxes that it paid the Exchequer. One hundred and sixty-seven men were killed, and I have spent a lot of my political life still in contact with the relatives and survivors. It is not something I want repeated. I have a simple rule: one man’s red tape is another man’s essential safety system.

The Conservative party was not always the way it is now. A week or so ago I read an obituary of Robert Carr, who died recently. Lord Carr had the onerous responsibility of taking the Industrial Relations Act 1971 through Parliament. That was flawed, and he made it clear later in life that much of it was not easily

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understood; I think that was how he put it. He had practical experience of manufacturing industry. His family had owned a metal works, which apparently provided metal for the airframes for, I think, the Wellington bomber, during the war. It was a quite substantial company. After his spell as Secretary of State he said that because of his time on the shop floor in his fathers’ factory he understood the importance of trade unions. That breed of Tory—people with practical experience of the workplace—seems to have gone. He understood the importance of trade union rights and was genuinely liberal about them.

There are more important issues involved. The way we deal with the workplace is extremely important. As I have said, we have virtually lost our manufacturing base. We have the car industry and a few other significant areas, but perhaps we should look at what happens in other countries—particularly Germany. After the war Germany recognised the importance of good relations between the work force and management. It established a system that German trade unions tell me is almost as revered as the NHS. The key thing is that the work force has a voice at every level.

I lost my seat in 1992 and at that time—another confession for the hon. Member for Congleton—I worked for the trade union movement. I was responsible for organising some conferences for what is now a part of Unite, but was then the Transport and General Workers Union. One conference was about the automotive industry, and I had the task of asking the head of BMW in the UK to speak at the conference. I had a meeting with him and he asked me what I wanted him to say—an unusual situation for me; usually it is a case of being told what someone wants to say. I just said, “Be union-friendly.” He said, “I can be very union-friendly. I strongly believe that no major company can now operate without the strong support of its work force and trade unions.” He was a member of the main board of BMW in Germany at the time.

That philosophy seems totally alien in our political system. The debates on trade unions that we have had in this House—the last one was on a ten-minute rule Bill on facilities for trade union members—are marked by two things: ignorance and anger. There is polarisation on both sides. That is bad for us, politics and the country.

Albert Owen (in the Chair): Before I call Robert Halfon, I want to make an announcement on time limits. Because of the number of hon. Members who want to speak, including those who have given advance notice, I am, with the authority of the Chairman of Ways and Means, imposing a time limit of four minutes on Back-Bench speeches. The rules are exactly as in the House. Each of the first two interventions accepted will stop the clock and give the hon. Member who gives way an extra minute. We do not, as the Chamber does, have the mechanisms that enable hon. Members to know the time on the clock, so with the assistance of the Clerk we will ring the bell when there is a minute to go. An intervention made in the last minute entitles an hon. Member to added time.

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9.55 am

Robert Halfon (Harlow) (Con): I congratulate my hon. Friend the Member for Congleton (Fiona Bruce) on obtaining the debate. I am a member of Prospect trade union, and it does not give me any money for political campaigning, but I am publishing a pamphlet with Demos in the next couple of weeks, on relations between the unions and the Conservative party, and am deeply interested in the issue.

I want to make three points. First, I believe that it is wrong to lump all trade unions together. Secondly, as the hon. Member for Aberdeen North (Mr Doran) said, the Conservative party has a long history of co-operation with unions, on which we should build. Thirdly, we should do more to support the moderate majority of trade union members, most of whom are not political activists.

It is true that some trade unions get subsidies from the Government, as do banks. Yet many unions are, we should acknowledge, capitalist institutions, offering services that are intended directly to replace state provision, such as private health care. The market comparison website privatemedicalinsurance.co.uk shows that the Labour-affiliated union Unison has recently encouraged its members to join private health care schemes such as Medicash.

There are other examples. In 2001, The Daily Telegraph reported that 3.5 million trade unionists—more than half the TUC membership—now have some form of private health cover. That was 10 years ago. Since then the trade union movement has considerably professionalised and strengthened its private health care offer and other services, such as legal insurance. I suggest to my hon. Friends that we need to look at the reality of trade unions, not just the rhetoric of extreme militants.

Unions are still the largest membership associations in Britain. They are hugely more popular in membership terms than all the political parties combined.

James Morris (Halesowen and Rowley Regis) (Con): My hon. Friend is making important points. The Conservative party has had a positive relationship with the trade unions, but is not transparency of funding and understanding what trade unions do the most important thing?

Robert Halfon: Yes, I accept exactly what my hon. Friend says; I am all in favour of transparency. However, TUC membership now stands at 58 unions, representing 6.5 million people—more than the population of Scotland. Of those 58 unions, just 15 are affiliated to Labour, leaving 43 that are non-affiliated. In addition, there are huge numbers of small staff associations. My point is that those 6.5 million are a complex network of people, and the vast majority of them will be moderate Britons, in all sectors of the economy, from all walks of life, and not militant activists.

I am proud that our party has a long history of co-operation with the trade unions, beginning in 1867, before the Labour party even existed. It was the Conservative Prime Minister the Earl of Derby who first sought to legalise trade unions in 1867. He said in the House of Lords at the time that

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“the voices of Manchester, of Birmingham, of Leeds, and of all the other important centres of manufacturing industry were absolutely unheard.”—[Official Report, House of Lords, 22 July 1867; Vol. 188, c. 1775.]

He praised a trade union march in London, insisting to a hostile Liberal Opposition that the process was entirely legal.

I say these things not because I am not a proud Conservative: I come from the Thatcherite wing of the party, but even Mrs Thatcher was an active trade unionist. In 1950, she was elected president of the Dartford branch of one of the first organisations that she ever joined, the Conservative Trade Unionists. One of her first engagements as Leader of the Opposition was to address the CTU. She told them in 1975—it is well worth hearing this quotation—that

“the law should not only permit, but…it should assist, the trades unions to carry out their legitimate function of protecting their members.”

We all remember Mrs Thatcher for the wars against Arthur Scargill and so on, but she was supportive of trade union members and grass roots, although she was against militants. I am a firm Thatcherite on trade union reform.

Alec Shelbrooke (Elmet and Rothwell) (Con): To add to my hon. Friend’s comments about Mrs Thatcher, I remember that Norman Tebbit was very much a trade unionist within the aircraft industry and, indeed, led strikes.

Robert Halfon: My hon. Friend proves my point. In 1979, during the general election, trade union members held a mass rally at Wembley stadium under the banner “Trade unions for a Conservative victory”. That is the kind of future that I hope our Government will aspire to.

My conclusion is that we need to support the moderate majority of trade union members, most of whom are not political activists. In politics, language is everything. We should not be afraid to support grass-roots trade union members, to encourage people to join trade unions and—dare I say it?—to have, perhaps, the occasional beer and sandwich. We often discuss facility time, and, yes, we need to crack down where it is abused and say that it should not be used for party political activity. Nevertheless, some facility time is good. A local employer in my constituency, the bus company Arriva, says that facility time is incredibly beneficial. The politically neutral First Division Association, which has 20,000 members, uses facility time to relocate the families of civil servants who are serving overseas. While we crack down on the abuses, we should recognise that not all facility time is bad.

Whatever reform is pursued, our focus must be on what is right for union members. It may be worth returning to the original opt-in position for political levies, which was the status quo until 1945.

Finally, I will quote Richard Balfe, the former Labour MEP who came over to the Conservatives. He said:

“British politics has changed enormously in recent years. Labour has become a rich persons’ party and the Conservatives are reaching out to groups that in the past would not have been natural allies. We do not expect to convert the leadership of the trade union movement, but we do offer respect for the achievements of the movement and the possibility of a mutually beneficial dialogue.”

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I say to the Government and my hon. Friends that, despite the rhetoric, let us not walk into the elephant trap set for us by Len McCluskey, Bob Crow and others.

Albert Owen (in the Chair): Order.

10.2 am

Mr David Anderson (Blaydon) (Lab): It is a pleasure, Mr Owen, to serve under your chairmanship.

Can we just think about the people that we are talking about? They are public servants who represent millions of public servants, whose only role in life is to deliver quality services for the people we are fortunate to represent. These people are not the enemy within.

I agree with what the hon. Member for Harlow (Robert Halfon) said about the Tory party’s track record not being anti-union. The Tory party supported Solidarnosc in the early 1980s, but it did not support the shipyard workers in Sunderland when it destroyed the Sunderland shipyards. The Tories supported the Union of Democratic Mineworkers, but they did not support it while they were destroying the British coal industry. The Tories then forgot about them and put them on the dole along with the other 200,000 miners who lost their jobs because of the Tories’ policies. Only last week the Prime Minister had some trade unions into No. 10 to talk about the health reforms. The one thing those three examples have in common is that the Tories liked those groups as long as they were doing their bidding. When the unions are doing the bidding of their members, somehow they are no longer friends of the Tory party.

I am proud to have been a member of a trade union for 43 years. I have been at the sharp end. Unlike most people here, I have not just read about this. I was an elected lay official for my union, released from work for 15 years by Newcastle city council to represent a membership of 7,000 and a work force of 16,000. My hon. Friend the Member for East Kilbride, Strathaven and Lesmahagow (Mr McCann), who spoke earlier about industrial relations, has got it absolutely right: we have lost sight of what industrial relations means. It is about developing a relationship with people and between management and the unions. Most of the time is spent avoiding problems. It is about building relationships, so that we can say, “Look, we need to go and see these people, because if we do not see them, things will go off the rails.”

There are huge examples. I spent many hours with home care workers, encouraging them to take redundancies or to take ill health retirement. That was a huge step for them, but they put their faith in me and that helped my authority in being able to respond to the cuts being imposed on them. I did thousands of disciplinaries and grievances. I was involved in appeals, social security appeals and industrial tribunals. If I had not been there doing that, those people would have been unrepresented. It is somehow being argued that taxpayers should not be doing this and that the unions should fund it all. If the unions fund it all, as the Tory party knows, no union in the world could have sub levels high enough to do that. It would also lose the hands-on experience of people who were working on the ground and at the coal face—I literally worked at the coal face—who try to make things better for the people they employ and the people they represent.

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Where has this debate come from? We all know that this debate has not come from the employers, because I work closely with the public sector employers in Gateshead, such as the council, the college and the hospital—I see the chief executive on a regular basis—and not one of them has said to me, “Let’s get rid of facility time.” We have some strong, hard relationships. As we sit here today, the unions in Gateshead council are sitting with the management trying to work out how they make 350 people redundant with as little damage to the people and the service as possible.

It would appear that the truth is that the hon. Member for Congleton (Fiona Bruce), who led this debate, was not strong enough to control her officers, because her officers have control of whether members have time off. If the council and the officers do not agree that the trade unions have time off, it does not happen. If she was not strong enough to control her officers, that is a fault with her and her administration, not with those who represent the people on the ground.

We know where this has come from: it has come from the storm-troopers of the TaxPayers Alliance. If we are talking about storm-troopers, we all know what Hitler’s attitude was to trade unions: get them out of the way, lock them up and destroy them. I am sure that no Member would support anything that Hitler or the people he represented did, but that is the slippery slope that we are on with this debate.

10.6 am

Priti Patel (Witham) (Con): The context of this debate is the reform of trade union funding. In the four minutes that I have, I want to touch on the areas of facility time, direct payments to unions and the political levy.

The Minister will be aware that I welcome the current review of facility time. At a time when public bodies are being asked to publish all spending over £500, it is shocking how little information is being made available about the tens of millions going to the trade union movement in various forms. As part of the Government’s review, I urge the Minister and the Government to introduce measures requiring public sector employers to publish in full detail the use of facility time in their organisation, the amount of time and, importantly for transparency, its purpose. It is essential, because we need to see why facility time is five times more prevalent in the civil service and three to four times more prevalent in the wider public sector than it is in the private sector. That is a stark difference.

Both the public and private sectors are bound by the same laws on facility time and both sectors have to grant paid time off for trade union activities, such as negotiating pay conditions, meeting employers and supporting members at disciplinary hearings. Important though those are—I think that we would all agree about that—why do trade union members in the public sector seem to receive so much more paid time off than their private sector equivalents? That has to be looked into and is where the point about transparency comes into play.

I will give an example. Unison has boasted recently in various documents that securing paid facility time for trade union activities, such as attending conferences

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and campaign meetings, is a vital part of its organising strategy. Its community service group guidance note on facility time states that

“a key task for you in negotiating a facility time agreement will be to get as many activities as possible covered by your paid facility time allowance. In other words, although you’re entitled to unpaid time off…why not try to get those activities covered by your paid time off?”

That comes back to the point on transparency.

I want to touch quickly on direct payments. We have already touched on local authorities and the amount of time for paid equivalents, full-time equivalents and part-time equivalents and how—I think the hon. Member for Blaydon (Mr Anderson) said this—that was down to the local authority. It is worth looking into the extent to which this is taking place across the country. Some weeks ago, I mentioned Camden council, which seemed to be giving a lot of resource to securing union facility time and putting its payment as a priority, while cutting front-line services. That is a major area.

Direct payments are another way the public purse supports trade union activity. The Union Learning Fund costs the taxpayer something like £22 million a year and supports the employment of about 170 trade union employees. More transparency is definitely required in relation to direct payments.

Mr McCann: Will the hon. Lady give way?

Priti Patel: I will not give way, as I have to wrap up quickly. Regarding the political levy, it is worth noting that the membership forms for both the GMB and the Public and Commercial Services Union make no mention at all of the fact that their membership fee includes a contribution to a political party’s political funds. That is another area that requires more transparency. Those who sign up to join those unions should be informed that included in the price, they are signing up to give their money away to a political party.

I hope that the Minister will take these comments on board and let us know whether the Government can fast-track proposals in the report by Sir Christopher Kelly on party political finances to address these matters and empower union members to decide explicitly whether or not to opt in and pay their political levy, rather than having it taken from them without their knowledge.

10.10 am

Jim Sheridan (Paisley and Renfrewshire North) (Lab): Thank you, Mr Owen, for calling me to speak.

It is normal practice to congratulate the hon. Member who secures a debate in Westminster Hall. On this occasion I shall resist that temptation, because there is no doubt whatsoever that this is a politically driven debate, with the dark hand of the TaxPayers Alliance behind it—an organisation about which little is known, including how it is funded, so we know where it is coming from. It is also rather interesting that the Conservative MPs in Westminster Hall today are all from the new intake of the party’s MPs, which gives us an idea of where the new Conservative party is going.

I must say that I have not had one single constituent complain to me about trade union funding—not one—in the 10 years that I have been in Parliament. In terms of

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employment rights, we already have the most business-friendly employment rights in the whole of Europe. That is undisputed, and if people do not believe me let me quote Richard Lambert, the director general of the CBI in 2009, who said in a foreword:

“In today’s difficult economic climate, it is more important than ever that all resources available to the workplace are well deployed. Union reps constitute a major resource: there are approximately 200,000 workers who act as lay union representatives. We believe that modern representatives have a lot to give their fellow employees and to the organisations that employ them.”

Mr Gregory Campbell (East Londonderry) (DUP): Does the hon. Gentleman agree that, however he would analyse or describe the business-friendliness of the current Government, being business-friendly does not necessarily mean the opposite of being in favour of workers’ rights?

Jim Sheridan: The hon. Gentleman is absolutely right and I am glad that he made that intervention.

There are some members of the Conservative party who live in the real world, none more so than the Minister for Further Education, Skills and Lifelong Learning, the hon. Member for South Holland and The Deepings (Mr Hayes), who said:

“I want to pay tribute to union learning reps, who have made so much difference to so many lives, and to such effect. Trade unions can play an invaluable and immeasurable role in improving skills in the workplace.”

That suggests that there are some Conservatives—apart from those in Westminster Hall today—who live in the real world.

For my sins, I have been a member of the Transport and General Workers Union and I am still a proud member of the Unite union. I am also proud to be the chair of the Unite parliamentary group, which meets regularly and takes up issues with whatever Government are in power. Before anyone asks about my funding, there is absolute transparency about my funding, including my funding from the trade union movement; it is all recorded in the books and is there for everyone to see.

In the short time that is left for me to speak today, I will focus on one of the major issues that trade unions are involved with, which is health and safety in the workplace. For my sins, I am also chair of the all-party group on health and safety, which deals with occupational health. We have just released a report that highlights the dangers from asbestos to children, teachers and other people who work in schools. There is not one single business in this country that would raise the issue of people dying of asbestos-related diseases, especially children who go to school and who are in danger of being contaminated by asbestos and suffering from such diseases. As a former shipyard worker, I have seen people die of mesothelioma, which is the most horrible death that anyone could ever see, yet employers are still churning out asbestos to the third world because it has been banned in this country. That is what trade unions are about; that is what their job is about. It is to ensure that people go to work safely and come home safely. It is unfortunate that the hon. Member for Beckenham (Bob Stewart) is no longer in the Chamber, because he is a former member of the armed forces and it is a little known fact that more people are killed in the workplace in the UK than British service personnel are killed in armed conflict.

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I am conscious of the time, Mr Owen, and all I want to say in conclusion is that I have worked for many good companies, none more so than Thales, which is a very successful and progressive business. It sees every benefit in having trade unions in the workplace. In fact, it goes out of its way to ensure that people have the opportunity to join a trade union. The rhetoric from Conservative MPs today is different from what is happening in the real world and it is really disappointing to see that the Conservative party, which has some decent people in it, has been dragged down by the young Turks.

10.15 am

Nigel Adams (Selby and Ainsty) (Con): I will thank my hon. Friend the Member for Congleton (Fiona Bruce) for securing this debate.

I wanted to speak today because I am supportive of what trade unions do in representing the interests of their members, giving them a voice and standing up for their rights. Although the traditional view of the relationship between employers and trade unions has been that it is one of confrontation, that view is misleading; in most cases, employers and union representatives have a very constructive relationship.

Indeed, from the point of view of the employer many benefits come from unions. For example, trade unions can be a supportive and welcome presence in assisting with significant changes within a business and they also provide a forum for negotiation that often saves time and cost compared to dealing with employees on an individual level.

On a personal level, I am hopefully about to be elected as the new president of Conservatives at Work, which was formerly Conservative Trade Unionists. I pay tribute to Lord Taylor of Holbeach for all the work that he has done as the previous president. My colleague, my hon. Friend the Member for Harlow (Robert Halfon), is also very much involved with Conservatives at Work.

Conservatives at Work has played an important part in guiding the Conservative party in its work with trade unions, so I am involved in that and I have always remained supportive of the aims of trade unions. That said, I am uncomfortable with the idea of taxpayers’ money being used to fund union officials who are working in public sector roles, as was revealed in my own part of the world in June last year when it emerged that taxpayers are paying almost £200,000 towards the salaries of union officials at North Yorkshire county council while important local services were under threat, and indeed continue to be under threat.

On a wider level, it has been revealed that in 2010-11 public sector bodies spent £113 million on staff working on trade union activities.

Mr McCann: Will the hon. Gentleman give way?

Nigel Adams: I will push on, as I only have a couple of minutes to speak.

To clarify, £113 million of taxpayers’ money was spent. Broken down, an estimated £80 million was spent on paid staff time, with £33 million in direct payments, which was £7 million more in direct payments than in 2009-10. At a time when there is a lot of protest about cuts—due to the catastrophic financial position left by Labour, a party that I understand receives 90% of its

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funding from trade unions, although I stand to be corrected on that—it is not right that we have public sector workers who are being paid not to do the front-line service that they were employed to do. As the taxpayer is picking up the bill, the subscriptions that the unions raise from their members, which the man on the street would assume were being used to fund the union, can then be spent on other activities, such as campaigning or potentially keeping the Labour party afloat.

All of us on this side of the fence were thrilled at the Prime Minister’s recent public support for the campaign on union funding. He described the use of taxpayer funding to pay for trade union activity as unsustainable, both morally and economically, and I am pleased that we have the weight of the Government behind us.

I accept that under the Trade Union and Labour Relations (Consolidation) Act 1992, union officials have the statutory right to “reasonable time” off work, with pay, to attend to specified trade union duties, but let me say that again—it should be “reasonable time” off work.

10.19 am

Mr Gerry Sutcliffe (Bradford South) (Lab): I congratulate the hon. Member for Congleton (Fiona Bruce) on securing this debate. I thank her for saying that trade unions are a force for good, and that has also been mentioned in the speeches overall.

I am a member of Unite and of Unison. Unite has contributed to my election funding for many years, and I hope that that continues for many years to come. If it was not for the trade union movement, I would not be here as a Member of Parliament. I was brought up as a trade unionist and my politics came from involvement in trade unions. We need to consider the history of how political development took place, particularly in the Labour party and its relationship with trade unions.

Since becoming a Member of Parliament and being involved in trade union activity, I have also had the dubious pleasure of being the Minister with responsibility for employment and employment rights for three years. For me, the debate hits home. Had the debate been entitled “Review of facility time”, I might have understood the need for a discussion about the issues that affect our local authorities, although I would not have agreed with the need for a review. If we agree with the argument for doing away with facility time for public union officials, what do we do about human resources teams in local authorities? Do we get rid of them next? In reality, these people, from all sides, contribute to making sure that democracy and diplomacy in employment relations goes on.

In my view, there is no case for looking at political levies. The political levy ballot was first introduced in 1980 by the Thatcher Government. The hon. Member for Witham (Priti Patel)) let the cat out of the bag when she talked about the political levy and the transparency of the Union Learning Fund. Most employers—perhaps the hon. Lady would like to check—would agree that that fund is one of the finest things that we did in Government, because it provided the opportunity for working class people to engage in training and develop through higher education and beyond. It was welcomed by most employers, particularly the CBI.

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So what is the motivation for today’s debate? I do not think it is about facility time. I think it is about that core issue in the minds of some Conservatives who believe that the relationship with the trade unions and the Labour party is too close, and they want to undo it. That should not be the driving force. We know that the figure of £113 million has come from the TaxPayers Alliance. It states that £80 million was for paid staff time and £33 million was in direct payments, which equates to staff costs of 2,840 full-time equivalent staff. However, those figures do not calculate the savings made by individual staff in the work that they do. A modern country should be looking for good industrial relation patterns.

When I was the Minister with responsibility for employment, I saw the need to ensure that we had genuine co-operation in the workplace, whether it was in the private or public sector, and to ensure that we could get productivity and develop as a competing nation in the world. There will always be difficulties and different aspirations between employers and employees, and that is why we need good human resources departments and good, strong trade union bargaining. I hope that Government Members will reflect on this and not make it a politically motivated campaign. I hope that they heed the words of the hon. Member for Harlow (Robert Halfon), because we need a constructive dialogue with trade unions. If there are issues and problems with buildings and suchlike, it is better to deal with them in a positive way rather than wage a political campaign that will undo the good relationship that exists between employers and employees.

10.23 am

Oliver Colvile (Plymouth, Sutton and Devonport) (Con): Thank you for calling me in this debate, Mr Owen. I congratulate my hon. Friend the Member for Congleton (Fiona Bruce) on securing it. May I make it clear at the beginning that I am not proposing to end up getting into trade union bashing, because I recognise that the unions play an important role in industrial relations and in making sure that everybody works together. May I also correct a possible misinterpretation? I understand that the term “pilgrim” refers to a trade union official who goes out and campaigns. In Plymouth, being a Pilgrim means being a supporter of Plymouth Argyle football club. I am delighted to say that I was there to see them draw 0-0 against Dagenham & Redbridge at the weekend.

It is important to recognise that in my city in my constituency, 38% of people work in the public sector, so there is a great deal of interest in employment rights and how the trade unions work not only with the city council, but with a whole series of different organisations. They work with the health service, for instance, and with Babcock, which is a significant employer in helping to ensure that our Navy continues to operate properly.

From my perspective, I find it difficult to go out on the doorsteps and explain to people that, at a time when we are making cuts to front-line public services and when the local authority is making sure that it empties the dustbins and that the potholes in the roads are filled in, the trade unions should end up being treated as a special case. I hope that the Government will ensure that there is significantly more transparency in how the

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trade unions operate. Perhaps the local authority should make a decision once a year about whether it wants to continue to make the facilities available.

I think that the trade unions have done a significant job, and they have a significant part to play. Indeed, during the discussions on Post Office privatisation, I met with trade unions and I encouraged them to get involved in trying to sort out the problems inside the Post Office, and I encouraged them to make sure that they were able to buy shares in that service. That is something that we may need to look at.

My final point—I am aware that lots of people wish to speak—is that we need to look at the trade union levy and ensure that people can opt in rather than having to opt out. It has to be a positive choice that people make. If it is that way round, we can have a level playing field for everyone to operate in.

10.26 am

Ian Lavery (Wansbeck) (Lab): In the brief time that I have, I want to say that I believe that this is a callous attempt to attack the trade unions and trade union members in the workplace. Many of them are ordinary men and women simply seeking to do a valuable job. My hon. Friend the Member for Blaydon (Mr Anderson) —my very good friend and former mining colleague—said that he is not sure that anyone here has ulterior political motives: I am sorry to disagree, but I believe that that is the case.

Fiona Bruce: Will the hon. Gentleman give way?

Ian Lavery: I will not give way. It has been mentioned before that we want more transparency. Since the Tory Government took office, they have introduced a certification officer. We now have more legislation than any other democracy in the western world, and our trade unions are more restricted than anywhere else. My view is quite simple—there is a concerted attack on ordinary men and women. However, we should not be surprised. When any Government Member gets up and says, “My auntie used to work here, and my father was a miner”, we know that something is coming in the following sentence: kick the trade unions.

I disagree with several things that have been said. On 30 November, the day of the public sector strikes, the Prime Minister clearly stated in the House that he would review the facility time for trade unions. That was his reaction—to kick the trade unions for daring to have the audacity to speak up for their membership. However, it had been mentioned beforehand.

David Morris (Morecambe and Lunesdale) (Con): Will the hon. Gentleman give way?

Ian Lavery: I will not give way. It had been mentioned at the Tory party conference by officials and Ministers who were proud to be trade union bashers and trade union kickers. That is why a lot of the new Tory MPs are thinking that this is the way to get a job in the party. They think, “Let’s start kicking the trade unions. That’s what we should be doing.”

I have been a trade union representative since the age of 16 or 17. I have been involved in both the private and public sector. By the way, the private sector represents

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about 40% of facility time, so it is not only public sector representatives who are paid for by taxpayers for facility time.

About the money that has been suggested is being paid by the taxpayer, in my experience, if I had any time off for facility time, I would have just received the wages that I would have received had I been at work. That is not even a saving. No one was put in my place, so there was no saving. It is misleading to suggest that there can be a huge saving in facility time, because, in the main, people are not replaced when they are doing facility time, and that is important.

I represented people in the mining industry. My facility time was about health and safety. What is more important than health and safety in the workplace? I visited people who had lost their husbands underground. They did not want to see the colliery manager or anyone from the management. They would ring up and say, “Mr Lavery, can you go and speak”—

Albert Owen (in the Chair): Order.

10.30 am

Mr Aidan Burley (Cannock Chase) (Con): It is a pleasure to serve under your chairmanship today, Mr Owen.

I, too, start by congratulating my hon. Friend the Member for Congleton (Fiona Bruce) on securing this important debate. The level of taxpayer funding of trade unions has clearly become a major political issue. As sunlight is the best disinfectant, it is important that such issues are debated honestly and openly in Parliament.

I am amazed at the churlish comments made by some Opposition Members in not congratulating my hon. Friend on securing the debate. The trade unions, over this Parliament, under a Conservative-led Government, will still receive more than £500 million of taxpayers’ money. I cannot think of any other issue that MPs feel should not be debated at all. We can argue about reforms to the national health service and the police, but when it comes to trade union funding, Opposition Members feel that it is somehow beyond the pale to even debate or discuss it. I can only think that they worry that when the public realise how much of their taxes go on funding the trade unions and not on front-line services, there will be a huge public outcry. They fear that the momentum for reform would be unstoppable.

Jim Sheridan: Will the hon. Gentleman give way?

Mr Burley: No, I will not.

We, on the Government side of the House, feel that the public have a right to know where their taxes are going. That is why my hon. Friend the Member for Congleton has done such an important job this morning in securing the debate on behalf of hard-pressed British taxpayers.

As my hon. Friend said, there is now widespread public and parliamentary concern about paid time off for trade union activities and duties, an issue that has been acknowledged by the Minister for the Cabinet Office and the Minister for Local Government. They are both looking at reforming that practice, known as public sector facility time.

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I understand that the Cabinet Office is about to launch a consultation into the extent—indeed abuse, as pointed out by my hon. Friend the Member for Witham (Priti Patel)—of so-called facility time. I would be grateful to the Minister if he could update us on when the consultation will take place, what its parameters will be, when it will be likely to conclude, and what the recommendations for reform might be.

The issue this morning is one of basic principle: is it appropriate for the taxpayer to subsidise trade unions at all, and if so, to what extent? In the brief time I have this morning, I want to deal with the issue of principle, because as far as I can tell, it has never been properly explained or defended in public.

I listened carefully to the response of the right hon. Member for Wentworth and Dearne (John Healey) to the ten-minute rule Bill tabled by my hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman) on the issue. It was notable that in his response, at no point did the respected former Minister—I am sorry to see that he is no longer in the Chamber—defend or explain the principle of a public subsidy to trade unions. He opened his response by saying:

“This Bill attacks the most basic and most benign feature of trade union work—the day-to-day support for staff at work by their colleagues who are prepared to volunteer as trade union representatives.”—[Official Report, 11 January 2012; Vol. 538, c. 201.]

That rather missed the point, because we have no problem with colleagues who are prepared to volunteer as trade union representatives, just with colleagues who think they should be paid by the taxpayer to be trade union representatives. In fact, if I was a volunteer trade union rep, doing a worthy job for a few hours a week because I believed in helping colleagues, I would be rather annoyed to think that whereas I worked for free, other colleagues felt that they needed to be paid to do it; in fact, some feel that they need to be paid full-time to do it. Where is the fairness in that? Why do some trade union reps need to be paid while others do not?

Huw Irranca-Davies (Ogmore) (Lab): Perhaps I could defend that by pointing to Germany. Not only does Germany have the most productive manufacturing and industrial sector, it has one of the highest levels of public subsidy, recognising that productivity, health and safety and the competitive nature of its industry benefit from having active union-work force engagement. There is the defence. How would the hon. Gentleman respond to that?

Mr Burley: I am grateful for the hon. Gentleman’s intervention; at least he has had a go. I find it utterly counter-intuitive to claim that higher public services can somehow be delivered with public sector staff working for the union rather than in their jobs. There may be case studies of union reps doing valuable work, but equally, there are case studies of union reps working against the public interest, as has been exposed by MPs and the media, so I do not think the hon. Gentleman’s point holds.

In the minute that I have left, I want to point out a new statistic. The campaign that we formed, the Trade Union Reform Campaign, has pointed out that

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the TUC now receives three quarters of its funding from the public purse, runs a surplus of £40 million a year and is sitting on top of £1 billion of assets. The last time public sector organisations operated at that sort of profit was in the ’90s in the privatised utilities, which were struck with a windfall tax by the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown) in ’97. We have to question now whether the trade unions should be subject to a similar windfall tax. They received £113 million last year and £80 million in paid time for staff. As I have said, under the Conservative-led Government, they will still get more than £500 million. It is right that we ask whether that money could be better spent on the front line. That sum buys a hell of a lot of nurses, doctors, teachers and police officers.

It is unfair for taxpayers to shoulder the burden. Trade unions should pay for representation in the public sector themselves, using their subscription income. An hon. Member said that that would somehow end trade unions. It will not; they can clearly afford to represent themselves, as we have seen with the huge sums that Unison has. Taxpayers should no longer be expected to fund the army of trade union representatives.

10.36 am

Alec Shelbrooke (Elmet and Rothwell) (Con): It is a pleasure to serve under your chairmanship, Mr Owen. I congratulate my hon. Friend the Member for Congleton (Fiona Bruce) on securing the debate. It is important that things are debated. However passionate the arguments on each side are, there is nothing wrong with having this debate.

I have been disillusioned this morning. I am certainly not speaking in the debate to bash the unions. I do not believe that my hon. Friend the Member for Selby and Ainsty (Nigel Adams) wanted to bash the unions either.

Fiona Bruce: Will my hon. Friend confirm that not one single Member on this side of the Chamber has said anything other than to acknowledge the good work of the unions?

Alec Shelbrooke: When people look back through Hansard, they will see that much praise has been given to the trade unions.

I was a member of Unite for 11 years. My money ended up being spent against my hon. Friend the Member for Pudsey (Stuart Andrew), but there we go. I cannot say that I was ever funded by Unite. I believed in the trade unions, and one of the most important things about them comes down to the shop stewards. I have seen some good shop stewards—members of the Labour party and elected councillors. I was a Conservative councillor, and the shop steward in the university where I worked was a Labour councillor, but we were able to work together. A lot of it comes down to the shop steward on the floor, and I have seen progress being made.

I am not here to bash the work of the unions at all. The problem I think we have—I put this challenge to Opposition Members—is that if at the next general election, Royal Bank of Scotland turned up and said, “We have decided to give £10 million to the Tory party to campaign,” there would be outcry from the Opposition Benches.

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Nigel Adams: From our Benches as well.

Alec Shelbrooke: Yes, probably from ours as well; we would not be happy with it. That is an important point. There is some perception that we are union-bashing, but that is not true. I remember listening to the speech made by the leader of the Labour party at conference, just after he had been elected. He spoke about the dinner ladies who were told that they had to buy their uniforms and aprons. The trade unions got involved and made sure that they did not have to do that. That is important work by trade unions.

Everyone here likes to mouth off. We are the people who stand up and front up. We will stand up, debate and have an argument, but 95% of the people out there would sweat with fear at having to stand up right now to make arguments. That is why we need healthy, working trade unions.

However, there are some problems, and there is an easy way to overcome some of the perceptions about the funding between trade unions and the Labour party. It is simple: instead of having an opt-out of the political levy, let us have an opt-in. Someone would have to opt in each year, which then has to be audited. Where the pot of money from the opted-in political levy is spent can be decided by the trade union.

Jim Sheridan: By shareholders as well?

Alec Shelbrooke: Absolutely. The hon. Gentleman asks whether shareholders would be able to do it. Why not? We are trying to empower shareholders.

Mr McCann: Does the hon. Gentleman not concede that it has already been tried? The Conservatives introduced the Trade Union Reform and Employment Rights Act 1993, which forced trade union members to re-sign up to their trade unions every three years—a further attack. Does he also concede that while he may believe in trade unions, the contributions from the hon. Members for Cannock Chase (Mr Burley) and for Witham (Priti Patel) demonstrate that they are on a completely different planet from the one he is on?

Alec Shelbrooke: I would not say that my hon. Friends are on a different planet from me; their arguments just have a different emphasis. Many Government Members believe in trade unions, and find it demeaning to be compared to the Third Reich. It demeans the hon. Member for Blaydon (Mr Anderson), who said that we were going the same way as Hitler by trying to remove the trade unions. That devalues the debate today, which is about where the funding comes from.

Mr Stewart Jackson (Peterborough) (Con): Is my hon. Friend aware of the Warwick I and Warwick II agreements? To get the policies that they wanted from a Labour Government, the trade unions dictated the policies to be enacted by a Labour Government in return for union funding.

Alec Shelbrooke: There are indeed many stories, but I want to return to the specific—

Jim Sheridan: On a point of order, Mr Owen. That statement is completely untrue. Trade unions do not dictate Labour party policies. The hon. Gentleman should withdraw that remark right now—

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Albert Owen (in the Chair): Order. That is a point of debate.

Alec Shelbrooke: Thank you very much Mr Owen. We have seen in the past couple of minutes where my frustration has lain, with people saying, “Unions do this” or “Union bashing”. That is not what the debate is about; it is about funding and how public sector money is used. Politics is about perception, and if there is a perception that public money given to the unions is then given to the Labour party, the best way to solve that problem is to tinker with the rules and have an opt-in, so that people can say where they want the money to go. Then the unions can say, “We have this many people opted in and this pot of cash, and we have decided to give it to the Labour party.” No one would argue with that. We cannot argue with that.

There may need to be some reform. The balance needs to be redrawn for some of the public sector workers working full-time purely on union business, but that is a different debate. Please do not make this an argument about union bashing. That is offensive to many Conservative Members who believe in the work of trade unions. I am not here to speak for everybody on the Government Benches, but I know that a great many of my hon. Friends very much believe in the work of the trade unions. A great number of us have been members of trade unions and have worked in places where we have seen their work, but that does not mean that the situation is completely okay; there are aspects that need reform, but debate is the best way to examine that.

Ian Lavery: Will the hon. Gentleman give way?

Alec Shelbrooke: I will, but I only have about 10 seconds.

Ian Lavery: The hon. Gentleman is being very conciliatory in his contribution. The political levy is covered in the Trade Union and Labour Relations (Consolidation) Act 1992. Union members must be balloted, whether or not they pay a political contribution.

Albert Owen (in the Chair): Order. I call Gareth Thomas.

10.42 am

Mr Gareth Thomas (Harrow West) (Lab/Co-op): I congratulate the hon. Member for Congleton (Fiona Bruce) on securing the debate. She said that trade unions are a valuable part of our civic society and that they do hugely important work on behalf of many of their members, and I very much agree with that comment. She went on to make a series of other points from which she drew conclusions with which I am afraid I cannot agree.

I am slightly surprised that she and some Conservative Members should so obviously want to attack the interests of hard-working people—the home help, the teacher, the nurse, the learning assistant, the dustman, the cleaner. Those and many others who work in the private and, in particular given today’s debate, the public sectors are not paid huge salaries. They are part of the squeezed middle and are seeing their finances hit hard by the Government’s VAT rise, for example, and by high energy bills, which Ministers will not act on. Many of them are extremely worried about whether they will have a job in six months’ or a year’s time.

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If the hon. Lady and some of her colleagues have their way, the right of such people to be properly represented will be taken away. Thousands of hard-working families will lose that most basic of rights—the right to be properly represented when they need it most. That point was made by my hon. Friends the Members for Blaydon (Mr Anderson) and for Wansbeck (Ian Lavery).

Virtually all the staff who would be affected most by the hon. Lady’s proposals do not earn huge salaries, yet they still demonstrate considerable commitment and hard work in delivering some of our most basic and important public services. The Prime Minister once spoke of compassionate conservatism. I ask the hon. Lady and her colleagues, how is it compassionate to take away from often low-paid, hard-working employees the opportunity to be properly and professionally represented when they need it most?

David Morris: The hon. Gentleman referred to hard-working families. Does he not think that it is appalling that hard-working families’ taxes are funding people who should be working, but rather than doing their actual jobs, the taxpayer is paying them to be union officials pro rata?

Mr Thomas: With all due respect to the hon. Gentleman, I think that he has got completely the wrong end of the stick, as I will explain.

If an employee is facing sexual harassment, worried about safety in the workplace, about to lose their job or have their pay cut, and does not know where to turn when they have problems at work, trade union representatives—independent of their employers—offer a crucial place to turn. They are trained and experienced in handling such issues and in liaising with employers to resolve disputes and workplace problems before they escalate. They help to reduce the cost to the immediate employer and the social and human cost for the individuals concerned. They reduce costs to the employer and ultimately help to reduce the cost to the taxpayer, a point made by my hon. Friend the Member for Aberdeen North (Mr Doran).

Even if one accepts the figures in the TaxPayers Alliance report, which seems to have provided the context for the debate, union representatives amount to only 0.05% of the public sector work force, and, it must be said, they carry out a significant proportion of union duties in their own time. They have attracted a vast amount of Conservative MPs’ time. It is reasonable to wonder whether spending so much time on that issue is the best use of the House’s time. The national health service is in crisis, we have record levels of joblessness, the economy is in free fall, welfare to work schemes are falling apart, many charities and community groups are in a desperate search for funding and there are huge cuts to our armed forces. When all those issues deserve the attention of the House, it is a little surprising that Conservative Members want to focus on 0.05% of the work force.

As my hon. Friend the Member for Paisley and Renfrewshire North (Jim Sheridan) pointed out, interestingly, union representatives continue to enjoy

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the support of many business people, so much so that the former director general of the CBI, Sir Richard Lambert, described them as having

“a lot to give their fellow employees and the organisations that employ them.”

If such a senior figure from the business world was moved to endorse the role of union representatives, maybe Conservative Members should pause and consider whether the performance of organisations in the public sector benefits from union representatives paid for by the public sector, as my right hon. Friend the Member for Wentworth and Dearne (John Healey) and my hon. Friend the Member for East Kilbride, Strathaven and Lesmahagow (Mr McCann) said.

Research by the University of Hertfordshire examining the benefits of funding trade union facility time in the public sector suggests that the work of union representatives saves between £260 million and £701 million per annum. For every £1 spent on union facility time in the public sector therefore, between £2 and £5 is returned in accrued benefits. Many City institutions would be proud of that rate of return. I gently ask why the hon. Member for Congleton and her hon. Friends think that Britain can afford to waste such sums of money, because that is what would happen if her proposals were accepted.

The organisation that appears to have created the context for the debate, and indeed for other such debates, is the TaxPayers Alliance. Its report does not seem to be terribly well researched. It is certainly not up there with research from the Institute for Fiscal Studies or Barnardo’s and it certainly contains misunderstandings about how the Union Learning Fund works. When I was preparing for the debate, I was interested that the slightly calmer voice of the Minister for Further Education, Skills and Lifelong Learning praised the work of Unionlearn. The report refers to unions that do not exist and to organisations that are not unions, including School Leaders Scotland, the Retired Officers’ Association and, I am told, a credit union.

Priti Patel: Will the hon. Gentleman give way?

Mr Thomas: Not now, no.

Trade unions are heavily regulated, a point made by my hon. Friend the Member for Wansbeck. The right of employees in the public sector to be represented properly is a measure that not even Margaret Thatcher in her wildest moments wanted to abolish. I recognise that TaxPayers Alliance reports are to Conservative MPs what sweets are to little children: a temptation, a must-have, something to cry and shout about. Older heads, wiser heads—I hope Ministers—need to recognise that behind the sound and fury, trade unions play a quiet, useful and important role in helping our public services to run more smoothly. In the worst of times, when employees feel vulnerable and on their own, a trained and professional representative, a trade union representative, can play an important role in supporting them.

Albert Owen (in the Chair): I am grateful to hon. Members for adhering to the time limit. I call on the Minister to reply.

10.50 am

The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd): I am grateful to the hon. Member for Paisley and Renfrewshire North (Jim Sheridan) for recognising that my friend and colleague, the Minister for Further

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Education, Skills and Lifelong Learning, my hon. Friend the Member for South Holland and The Deepings (Mr Hayes), lives in the real world. Some have doubted that in the past, so it was very helpful of the hon. Member for Paisley and Renfrewshire North to confirm that truth. However, he was entirely wrong to not congratulate my hon. Friend the Member for Congleton (Fiona Bruce) on securing the debate. I do so, and congratulate her also on how she presented her concerns. She always speaks with a great deal of personal conviction that is often rooted in real experience, and she did so again today.

I was disappointed that so many Labour MPs appeared to come here to frame the debate as the Tories bashing the unions. That is not the language I heard at all. Hon. Member after hon. Member stood up to recognise the valuable role of the unions, as I do too. No one in the Chamber needs a lecture about the value of good industrial relations, or the cost of bad industrial relations, and various Opposition Members spoke powerfully about that. For the avoidance of any doubt, the Government are not proposing any change in statutory entitlement to paid time off to carry out union duties. I am grateful to my hon. Friend the Member for Harlow (Robert Halfon) for pointing out that that goes with the grain of Lady Thatcher’s position.

In the context of the public sector, there is legitimate concern about the level of contribution from the taxpayer, about the issue of balance, which was raised by my hon. Friend the Member for Congleton, and—critically—the issue of transparency, on which my hon. Friends the Members for Witham (Priti Patel), for Plymouth, Sutton and Devonport (Oliver Colvile) and for Selby and Ainsty (Nigel Adams) spoke strongly. That is what we are debating this morning.

I start with the law. We recognise clearly that the Government have a role in facilitating the conditions for a positive relationship, including balancing the needs of the employer with those of the employee. That is achieved largely through the Trade Union and Labour Relations (Consolidation) Act 1992. As the title indicates, the Act brought together a variety of legislation that had been introduced and amended during the previous 20 years—a much more turbulent industrial relations climate. The Act covers a wide variety of issues, including recognition of unions in the workplace, the responsibilities of the employer and union representatives and, of course, industrial action. The extent to which the Act addresses trade union funding is in the context of union keeping of financial records, use of membership subscriptions for political purposes and, in the context of this debate, paid time off to carry out essential duties.

Ian Lavery: Will the hon. Gentleman give way?

Mr Hurd: I will make more progress before taking interventions.

Aside from one or two specific instances, the Act does not distinguish between the public and private sector. The statutory framework recognises that there will be essential business that underpins the union’s formal role and helps to facilitate good industrial relations in the work force. The Act therefore provides for time off to carry out that business. In doing so—this is important to the debate—it distinguishes between duties and activities. Duties are the essential tasks that union

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reps must carry out. They could include collective bargaining negotiations, formal engagement in statutory consultation on collective redundancies, accompanying an individual to a disciplinary hearing, and can also include health and safety responsibilities. Activities include attending union annual general meetings, executive committees and workplace meetings to discuss the outcome of negotiations.

There is a statutory entitlement to paid time off to carry out union duties, but there is no such entitlement for union activities. However, some employers, including in the public sector, extend paid time off to activities as well. There is no right to time off for trade union activities that consist of industrial action. The amount and frequency of time off, whether paid or unpaid, is for negotiation between the employer and the union and depends on what is reasonable, taking account of all the circumstances. There is no statutory minimum or maximum. That ensures the necessary flexibility to accommodate the wide variety of different work forces and different day-to-day circumstances within those work forces. By that I mean that what is reasonable today may not be reasonable tomorrow if the circumstances have changed.

An ACAS code of conduct underpins the legislation. The code is comprehensive and, among other things, emphasises the importance of clear procedures and record keeping, as well as general considerations in determining what is reasonable. They include the size of the organisation and number of workers, the need to maintain a service to the public, and the need to ensure effective representation and communication with workers with a range of needs.

As I said earlier, at the heart of the framework is the importance of good industrial relations in maintaining an effective organisation. A reasonable amount of paid time off offers value for money for customers of an organisation and users of their services. For example, it can minimise working time lost due to disputes and accidents at work.

Some hon. Members mentioned the union modernisation fund. The latest round of projects is currently winding up and will be completed by early 2012. No further rounds of the UMF are planned, and no further funds will be committed to it. It is important, however, for Government to ensure that public sector employers manage the paid time off they grant their union representatives effectively to deliver the benefits I have mentioned.

I was asked about the proposed consultation in relation to the civil service, which was announced at our party conference. In answer to my hon. Friend the Member for Cannock Chase (Mr Burley), we have already announced that we will be consulting with the civil service trade unions on the following areas: reduction in overall facility time across the civil service; ending or limiting the practice of 100% of civil service employees’ time being spent on trade union duties and activities; ending paid time off for trade union activities, as opposed to duties; and reporting, developing a common system for reporting and monitoring across the civil service. That is the framework of the consultation, which I am assured will start imminently.

We will seek to review and rebalance the amount of paid time off provided to undertake trade union duties. The current level of facilities time offered to

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trade unions across Departments is very generous, and is certainly significantly more than that allowed in the private sector, or indeed in the wider public sector. While recognising the importance of effective representation in the workplace, we firmly believe that trade union facility time arrangements in the civil service are in urgent need of modernisation to reflect modern working practices. The consultation is focused on the civil service, where my responsibility as a Minister in the Cabinet Office lies, however other colleagues who have responsibility for these matters in the wider public sector have been asked by the Prime Minister to review the position in their sectors.

10.58 am

Sitting suspended.

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Renewable Energy

10.59 am

Caroline Nokes (Romsey and Southampton North) (Con): It is a pleasure to serve under your chairmanship, Mr Owen. I am grateful to Mr Speaker for granting this important debate, because we are rapidly approaching 2016—a year that is demanding the Minister’s attention, given that security of energy supply, on which he is something of an expert, is increasing in importance.

I hope that this debate will feed into the wider discussion about the security of supply and be a useful contribution to the thinking on this issue. Given the three important issues that underpin that thinking—keeping the lights on, the diversity of energy sources and increasing the amount of renewable energy—I am pleased that hon. Members are here to listen to the debate.

The debate title is a testament to Britain’s growth in green technology and our status as a world leader in climate change awareness. However, as I will explain, for too long we have trailed behind countries such as Germany in the production of green energy, and we must take decisive action to secure support across the whole sector.

The reality is that attention within the renewables incentive debate has been centred on solar photovoltaic and wind energy. In the short term, river and wave energy may become a new focus. However, too little attention is paid to anaerobic digestion and other energy-from-waste technologies. The decoupling of the two subjects of waste management and energy production in the mind of the general public would be useful in overcoming hostility to the production of energy from waste.

Rehman Chishti (Gillingham and Rainham) (Con): I pay tribute to the excellent work done by my hon. Friend in this regard. Does she think that we need to expand on the excellent work of companies, such as ACM Environmental plc, which has converted waste into renewable energy in schools in Kent? Waste is converted on-site, rather than outside in other areas, and used to heat water, for example, at those schools.

Caroline Nokes: My hon. Friend makes an excellent point. That is exactly what I shall focus on, albeit in Hampshire rather than Kent.

To date, the main focus of attention on energy from waste appears to have been on large-scale industrial production of waste-sourced energy. Advanced gasification is a key part of securing green energy and decreasing landfill: it is a carbon-lean process involving the efficient, high-temperature conversion of waste to base-load electricity. After the August 2010 announcement that energy from waste can be sold to the national grid, there is now real discussion about how local authorities in particular can secure income sources by selling green energy. For example, Air Products, a leading provider of industrial gases and environmental systems, has been granted permission for a 49 MW advanced gasification plant in Teesside, the building of which will begin next year. That development will create 700 jobs, divert up to 350,000 tonnes of waste from landfill and produce enough predictable, clean power for 50,000 homes. Air

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Products is precisely the sort of provider of clean energy that we should be encouraging to meet our renewables obligations.

Alec Shelbrooke (Elmet and Rothwell) (Con): Does my hon. Friend agree that it is vital, in any incineration or gasification process, that the end result comes from harvesting recycled material along the way?

Caroline Nokes: Indeed; my hon. Friend is correct.

I should like to explore a number of issues facing the development of the renewable energy from waste industry outside the large industrial-scale plants that I have mentioned. I want to show how the current incentives are working and how we could adjust them to accelerate awareness and the development of the industry, particularly harnessing the potential for small-scale production, as well as production on an industrial scale.

I have called this debate because incentivising small-scale production could develop valuable employment opportunities, help small businesses and local communities generate their own green energy, grow UK exports and, most importantly, assist the Government to achieve secure, diverse and green energy.

As a country, we continue to produce too much waste and we need to promote better uses for our unwanted produce. Producing more energy from waste is therefore a win-win policy, but it needs to be carefully explained to the general public, as the subject is easy to misunderstand, especially when anaerobic digestion is not well communicated.

Anaerobic digestion is the process whereby biowaste from plant and animal material is converted by micro-organisms in the absence of air into biogas, which can in turn be used to generate green electricity and heat. Anaerobic digestion can help reduce fossil fuel consumption and greenhouse gas emissions—two essential goals in our fight against climate change. Almost any biowaste can be processed in that way, including food waste, energy-producing crops and crop residues, slurry and manure. The process can accept waste from our homes, supermarkets, industry and farms, ensuring that significantly less is sent to landfill.

Jim Shannon (Strangford) (DUP): I thank the hon. Lady for bringing this important matter to Westminster Hall. Does she feel that, to incentivise the use of waste material from farms, for example, the Government need to consider financial incentives, because although every farmer would wish to do that, financial restrictions might prevent them from doing so?

Caroline Nokes: Not just financial incentives are needed; deregulation and, in some instances, making the planning process a lot simpler for agricultural enterprises are needed, too.

The National Farmers Union is a vociferous advocate of anaerobic digestion and argues that its use on farms reduces emissions of methane from manures and agricultural residues, improves air quality through the control and reduction of odours, such as ammonia, and leads to benefits to water quality from the improved management of nitrogen and other nutrients present in manures.

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Another major advantage of anaerobic digestion as a renewable energy source is that the material left over at the end of the process—an odour-free digestate, rich in nutrients—can be used effectively as fertiliser. This could, and really should, become the standard fertiliser on the market. However, many domestic and business users do not understand the benefits derived from buying recycled products. A new petrochemical-derived fertiliser can cost a farmer between £200 and £400 per tonne, but the by-product from a micro-anaerobic digestion site is more likely to be of a consistent chemical and nutritional specification. Currently, the anaerobic digestion industry is struggling to sell recycled fertiliser, produced to resource action programme standards, at £5 to £6 per tonne. I would be grateful to the Minister if he expanded on how we can best explain the benefits of, and incentivise the consumption of, recycled fertiliser in farming and domestic gardening.

Many sites in the UK are producing biowaste. According to the Department for Environment, Food and Rural Affairs, the UK produces approximately 7 million tonnes of food waste and about 90 million tonnes of animal slurry and manure per year. With 23.6 million households and 41,000 farms, it is clear that the potential for green energy production is enormous.

The UK currently has 214 anaerobic digestion plants installed, of which 146 are sewage treatment sites. In comparison, Germany has approximately 9,000 farm-based sites and China has a simple, rural, domestic-scale approach to anaerobic digestion, which benefits millions of people. It is clear that the UK has far greater potential to make use of this technology. In light of Germany’s achievements in this field, the NFU’s commendable vision for 1,000 on-farm anaerobic digestion plants by 2020 seems quite modest.

There are almost unlimited possibilities for anaerobic digestion on a local scale. In my constituency, the patented technology of an innovative micro-anaerobic digestion technology provider, SEaB Energy, based on Southampton university science park, has produced a system that creates and generates power from waste inside a shipping container. Using that technology, the company has proved, both at the university science park and, locally, at Sparsholt agricultural college, that it is possible to implement micro-anaerobic digestion solutions. A number of other food producers, golf clubs and hotels are also exploring the benefits of using such technology across the UK.

All organisations create waste. SeAB is leading the way, through anaerobic digestion, in reducing our dependence on landfill by converting waste into valuable energy. I should welcome the Minister’s visiting and meeting the people who have developed this world-leading technology, so that he can see green energy in production.

There are several different options for anaerobic digestion, depending on the amount of energy required, and each has its own challenges. A centralised anaerobic digestion facility requires large quantities of biowaste to be collected and driven across the country, inevitably generating a strain on the existing road network and increasing the carbon footprint of the technology. It is also capital intensive, and the site-planning process can be lengthy.

By comparison, decentralised sites are arguably simpler to operate, quicker to build and easier to install and manage. Road haulage is largely eliminated and the waste producer benefits directly from using its own

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waste to generate its own green energy. I would be grateful to the Minister if he commented on how we can incentivise the many small waste producers, such as farmers, food growers, food packers, hotels, hospitals, schools or prisons—the list is almost endless—so that they can benefit from green energy throughout the country. In short, anaerobic digestion reduces the need for landfill, with the exciting possibility of creating sustainable communities with a consistent waste fuel power source.

The NFU is keen to ensure that smaller, farm-based biogas proposals are not disadvantaged by being labelled waste management. If we are to see the necessary growth in on-farm anaerobic digestion plants, it is important that they are subject to simple permits. I will be pleased to hear the Minister’s comments on that and on what work can be done with the Department for Communities and Local Government to ensure that light-touch regulation is encouraged among local planning authorities.

It is important to note that there is tremendous potential for the upgrading of biogas to biomethane for motor vehicle use as a tradeable low-carbon fuel or for direct injection into the natural gas distribution network. I understand that equipment for biogas upgrading is available from Germany, where such pipeline injection is growing, and in our constant search for fresh sources of car fuel, that is an extremely encouraging possibility.

Other sources of renewable fuel can be found in the waste stream, such as the conversion of used cooking oil into biodiesel, which is entirely sustainable and derived from a waste product. That would involve recycling almost 100 million litres of waste cooking oil each year, while helping the Government to exceed their greenhouse gas emission targets in transport by 8%. However, as highlighted by the recent report on environmental taxes by the Environmental Audit Committee, of which I am a member, the removal this March of the 20p per litre duty differential on such fuel will make it prohibitively expensive and high-blend users will have no choice but to return to fossil fuels. That will have a disastrous impact on the UK biodiesel industry, resulting in the loss of green jobs, as well as discouraging further investment in the development of new technologies in the energy-from-waste sector.

Ian Swales (Redcar) (LD): Does my hon. Friend agree that such fuels should be taxed on their energy content and not on their volume? The tax on volume is one of the problems for the industry in getting going.

Caroline Nokes: My hon. Friend makes an excellent point, and there is much to credit in his argument.

I strongly urge the Minister to continue to speak to his colleagues in the Treasury, because I fear that, without continued support, we will jeopardise the significant steps that have already been taken. The energy-from-waste sector is full of innovative and in many cases ingenious ideas. I am conscious that we need a wide variety of energy generation methods to meet demand. No one form of green energy provides the whole answer, and we need a range of solutions, both large and small.

In summary, there are a number of questions for the Minister. First, does he agree that there is real untapped potential for small-scale energy-from-waste production

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to contribute to the secure, diverse and green supply of energy? If so, can he outline clearly how the potential for small-scale production can be encouraged and incentivised? Secondly, what changes to legislation and regulation—in particular to that coming from the Treasury—would be a prerequisite for the vision of small-scale energy from waste production to become a reality? Thirdly, what can be done to rebalance the debate, to support the broader market development of sustainable fuels from waste, including micro-anaerobic digestion and to ensure that the necessary incentives are in place for the sector to thrive? I thank the Minister for taking the time to address the issues, and I look forward to hearing his response.

11.14 am

The Minister of State, Department of Energy and Climate Change (Charles Hendry): It is a privilege and a pleasure to serve under your chairmanship, Mr Owen. I thank my hon. Friend the Member for Romsey and Southampton North (Caroline Nokes) and congratulate her on securing the debate. She has given us an excellent summary of the benefits that such technologies can bring and a clear understanding of where she sees the barrier to their deployment. I want to go through where we see the opportunities and to say what we are doing to remove the barriers.

My hon. Friend has not been alone in the debate. I welcome the contributions of my hon. Friends the Members for Elmet and Rothwell (Alec Shelbrooke), for Redcar (Ian Swales) and for Gillingham and Rainham (Rehman Chishti) and of the hon. Member for Strangford (Jim Shannon), which all showed the understanding, depth of knowledge and interest in the issue that is present throughout the country.

I have already had the chance for a brief conversation with some of the people involved in SEaB. I am delighted with the opportunity to visit in the future and to see on the ground the work that they are doing in the constituency of my hon. Friend the Member for Romsey and Southampton North, but it is also important to put our discussion in the context of the wider energy debate, and that is how I wish to begin. She is absolutely right, however, to highlight the untapped potential of the sector, and part of our objective as a Government is to realise that potential in the most effective way that we can.

As my hon. Friend outlined, renewable energy has a vital role in our low-carbon future. By the end of the decade we must cut our carbon emissions by 35% on 1990 levels, and by the end of the next decade they must have halved. We also have the EU renewable energy target, which means that we must generate 15% of our energy from renewables by 2020. In order to meet that target, about 30% of our electricity and 12% of our heat will need to come from renewable sources. That is not only about meeting targets, because it is also the right thing to do, and we need to reduce our dependency on imported fossil fuels. Home-grown renewable energy can enhance our energy security and give us a greater degree of energy independence, helping to shield us from global fossil fuel price fluctuation, which seems to be in only one direction at the moment, as we see high prices for oil and gas. She also touched on the immense economic potential in renewable energy, and the sector could provide opportunities for up to 500,000 jobs.

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In the Department of Energy and Climate Change, we have been working with the renewables sector to understand more effectively how much renewable energy can be deployed by 2020, and to identify the current constraints that must be addressed.

Rehman Chishti: The Minister knows that 6.7 million tonnes of food waste are being discarded each year. Are there any plans to ban completely food waste going into landfill? If so, what is the time frame?

Charles Hendry: My hon. Friend is aware that what we have been seeking to do is to give local authorities more say in how they should manage their affairs, rather than a top-down, Government approach. For many of us with landfill or land-raise issues in our constituencies, it seems absurd to put food waste into such facilities. At the end of the day, however, we want the local authorities to be the driving force in resolving such issues. In his own case, Kent is a beacon authority in looking at how to manage its waste issues.

Ian Swales: I thank the Minister for investing DECC money into an anaerobic digestion facility at the Centre for Process Innovation in my constituency. He is referring a lot to renewable energy, but does the way in which waste is treated under all our policies throughout the various Departments satisfy the renewable energy criteria and meet the simplicity requirements mentioned by my hon. Friend the Member for Romsey and Southampton North (Caroline Nokes)?

Charles Hendry: My hon. Friend raises an important issue. For the first time, we are now moving towards a clear, cross-Department strategy on waste. That means looking at the hierarchy and at where we reuse and recycle, but also seeing that as part of that process there is residual waste, and getting an energy source from that is better than putting it into landfill and land raise.

Jim Shannon: Will the Minister give way?

Charles Hendry: I will give way briefly to the hon. Gentleman, but then must get on to the comments of my hon. Friend.

Jim Shannon: I recognise the Minister’s passion for the subject. He mentioned a Government strategy: will that include the regions such as Northern Ireland, Scotland and Wales as well, so that it is uniform and UK-wide?

Charles Hendry: We seek to work with the devolved Administrations but, clearly, different rules apply in different parts of the United Kingdom, where the different Governments have responsibility for such matters. If we have central control in Westminster over different aspects, we have the influence, but we obviously wish to work with the devolved Administrations to ensure that the strategy is as holistic as possible. The more that we can remove the barriers and have an integrated and holistic approach, the more effectively we can attract investment into the sector.

We have identified eight technologies that we believe will bring us closest to delivering those 2020 targets cost-effectively and sustainably. They are onshore and offshore wind, marine energy, biomass heat and electricity, ground source and air source heat pumps, and renewable

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transport. Biomass heat and power includes energy from waste technologies, such as anaerobic digestion, waste combustion and the new, advanced technologies of gasification and pyrolysis. We believe that those eight technologies collectively are capable of delivering more than 90% of the renewable energy we need for 2020.

Instead of just having targets, we are determined to show how we meet our objectives. It is easy for Governments to have targets, but then to leave them to a future Government to explain why they were not met. We are determined to put in place a clear road map that shows what barriers exist, and how we intend to overcome them so that we can be more effectively held to account in the process.

Last year, we published the UK renewable energy road map, which shows where we are now on those eight technologies, how deployment may develop up to 2020, and the actions that will need to be taken now to overcome the barriers to deployment. Although our evidence shows that we can meet our target of 15% renewables by 2020, we are clear that we need a rapid increase in deployment. At the end of 2010, renewable energy accounted for 3.3% of UK energy consumption, so there is a significant way to go.

Renewable electricity and heat technologies are generally more expensive than fossil fuel generation, and require subsidy to boost deployment, just as every previous new energy technology has done. Support is available under the renewables obligation, the feed-in tariffs scheme, the renewable heat incentive, and the renewable transport fuel obligation.

Julian Sturdy (York Outer) (Con): The Minister talks about eight key technologies and delivering them affordably. I entirely agree with that, but will the road map be flexible enough to change if technologies advance with time? If one technology becomes more prevalent in delivering the green energy that we need, will changes be made to cover that ?

Charles Hendry: My hon. Friend makes a crucial point. We have set out in the road map the high, medium and low trajectories for each technology. A key element that may change is the cost of delivering them. For example, we are working with the industry on offshore wind to bring down the cost by 40% over this decade, and that is critical to the extent of its deployment. If the costs cannot be brought down, we must make choices on behalf of consumers to show that we are trying to deliver those renewable objectives at the least cost to consumers. Flexibility is an integral part of that process.

Despite the undoubted benefits of renewable energy, it must be cost-effective and affordable compared with low carbon alternatives. I acknowledge the valid point that my hon. Friend the Member for Romsey and Southampton North made in her introduction that the renewables industry and investors need stability to plan ahead. Uncertainty is often the greatest enemy of investment. I also appreciate that recent changes, particularly to the support for solar photovoltaic installations under the feed-in tariffs scheme, may have temporarily affected industry and investor confidence, although we are now seeing strong growth again in the number of PV installations. We are committed to delivering our goals in a way that minimises the impact on consumers’ bills.

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In our measures to reform the support mechanisms, we have three objectives. They are designed to make the budget go as far as possible, and to maximise the number of people who can benefit from schemes. They will provide greater certainty for the industries concerned on the rates of return that they will receive up to 2020, and they will ensure value for money to consumers who pay the bills.

I understand that the scheduled banding review for the renewables obligation has caused some concern. Banding reviews ensure that as market conditions and innovation within sectors change and evolve—this point is directly in response to that made by my hon. Friend the Member for York Outer (Julian Sturdy)—developers continue to receive the appropriate level of support necessary to maintain investment. We have studied how much subsidy different technologies need. When new technologies need help to reach the market—for example, wave and tidal energy, which are emerging technologies—we have proposed increasing support, but when market costs have come down or will come down, we propose reducing the subsidy accordingly. That proposal will result in a lower impact on consumers’ bills than keeping the existing bandings, and will drive a higher level of deployment. Setting the bands for the period to 2017 also provides the industry with the certainty needed to make investment decisions now. The public consultation on the banding review has closed, and we will issue the Government’s response in the spring, confirming the banding levels moving forward. Legislation setting the new bands in law will come into effect on 1 April 2013.

I have mentioned the eight existing technologies that we have focused on in the UK’s renewable energy road map. Anaerobic digestion has, without doubt, an important role to play in both biomass heat and electricity generation. The United Kingdom produces about 100 million tonnes of food waste, manure, slurry and sewage sludge that is suitable for treatment by anaerobic digestion. When the coalition was formed in 2010, we stated our commitment to developing energy from waste through anaerobic digestion. I assure my hon. Friend the Member for Romsey and Southampton North and other hon. Members who have spoken that we remain absolutely committed to delivering on that commitment.

Last June, the Department for Environment, Food and Rural Affairs and the Department of Energy and Climate Change jointly published the anaerobic digestion strategy and action plan. It sets out our vision for anaerobic digestion, with an estimate of potential that could reach between 3 and 5 TW hours of electricity by 2020. Currently, there are only 172 MW of installed anaerobic digestion capacity in the UK, processing more than 5 million tonnes of material, and generating more than 1 TW hours per year. More is coming through the system. Just last week, Tamar Energy announced plans to develop 40 AD plants in the UK, with an installed capacity of 100 MW. In addition, we know of more than 100 plants that have received planning permission, and a further 80 that are going through the process.

It is clear that momentum is building and support for the technology is growing, but we recognise that significant barriers must be overcome for the sector to reach its potential. The anaerobic digestion strategy and action plan also sets out a joint Government and industry programme of work with 56 actions to tackle the key

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barriers to deployment. You will be grateful, Mr Owen, that I will not go through all those this morning. However, work is progressing on a range of actions, including disseminating information, particularly on regulatory controls; providing guidance on the costs and benefits of AD and best practice projects; developing skills and training for AD operators; building markets for digestate; and understanding the barriers to the use of biomethane as a transport fuel. Those pick up on most of the issues that my hon. Friend raised. An annual progress report on how we are moving to meet those actions will be published in the summer.

Our commitment to anaerobic digestion is also clear through the financial incentives that we offer. Anaerobic digestion is the only biomass technology supported under the feed-in tariffs scheme, which is aimed at smaller scale projects under 5 MW. Larger-scale projects are eligible for support under the renewables obligation. The renewable heat incentive supports biogas combustion below 200 kW thermal and the injection of biomethane at all scales into the national gas grid.

In addition, a £10 million loan fund is available from the Waste and Resources Action Programme to support the development of new AD capacity to divert 300,000 tonnes of food waste from landfill. WRAP is jointly administering, with the Technology Strategy Board, a fund designed to drive innovation in AD systems to bring down the cost of capital. Waste, including anaerobic digestion, is one sector likely to be eligible for initial intervention by the Green investment bank. In the meantime, a new team within the Department for Business, Innovation and Skills—UK Green Investments—has £100 million to invest in smaller green infrastructure projects, including AD, on a fully commercial basis. I hope that that reassures my hon. Friend that significant support is coming through, and that we have identified the issues.

I share my hon. Friend’s enthusiasm for smaller, more local plants. That is backed up by the study by consultants for the renewables obligation banding review that suggested that anaerobic digestion potential lies in stations with less than 5 MW of capacity. That ties in with our commitment to localism, which was raised during the debate, and is why, as part of the rural economy growth review, the Government have announced that they will promote the development of community-scale renewable energy projects in England through the establishment of a £15 million rural community renewable energy fund.

I also share my hon. Friend’s concern about the difficulties that anaerobic digestion operators experience in trying to sell their digestate as fertiliser. It is a valuable biofertiliser that can be used as a renewable source of critical plant nutrients, such as nitrogen and phosphorus. Although the UK has long-term experience with digested sewage, digestate derived from food wastes and other inputs is often regarded as novel by the market. There is a reluctance to accept it until evidence of its quality and benefits can be provided. The anaerobic digestion action plan contains a number of actions to build confidence, and I hope that my hon. Friend will continue to work with WRAP to ensure that the identified challenges are understood.

11.30 am

Sitting suspended.

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Scottish Football (Tax Liabilities)

[Mr Clive Betts in the Chair]

2.30 pm

Thomas Docherty (Dunfermline and West Fife) (Lab): It is a pleasure, Mr Betts, to serve under your chairmanship for the second time during this Session. I have been asked to give the apologies of some hon. Friends who are detained in the Scottish Affairs Committee and the Treasury Committee. I am sure that many of them would otherwise have been here to discuss their take on what has happened in the Scottish game in recent weeks.

Hon. Members need no reminding of the importance that football clubs play in our communities north and south of the border. I am privileged to have two senior football clubs in West Fife. Dunfermline Athletic is in my constituency, and Cowdenbeath is some 800 metres over the border in the constituency of my right hon. Friend the Member for Kirkcaldy and Cowdenbeath (Mr Brown), the former Prime Minister. I want to say a little about the role of those clubs, and clubs like them, throughout Scotland and the rest of the United Kingdom.

On Saturday, I was lucky to be taken to Cowdenbeath’s home game against Brechin City football club as the guest of a local law practice, Stenhouse Husband & Irvine. While sitting with the club’s board of directors over lunch, I was able to talk about the state of the Scottish game as a whole, and the way in which clubs operate in the lower divisions. People give up their time and money to support clubs such as Cowdenbeath and Brechin City, and I was struck that they do so not for financial gain, or the glamour, or even the company of Members of Parliament, but because of their deep affection for the clubs in their communities, their love of football, and because they want to give something back to their home towns.

On Saturday afternoon, I had the opportunity to spend some time with the chairman of Cowdenbeath football club, Donald Finlay QC. You may not be familiar with that name, Mr Betts, but he is one of Scotland’s highest profile Queen’s Counsel, a former vice-chairman of Rangers football club, twice rector of the university of St Andrews, and someone who has enjoyed a colourful and entertaining history of involvement with Scottish football. While chatting to him on Saturday afternoon, I asked him why, having been involved with Rangers during their most successful period, highlights of which included narrowly missing out on a European cup, and achieving nine league titles in a row, he provided so much time and energy to support one of the lesser lights of Scottish football. I hope that Mr Finlay does not mind me sharing his answer. He said that he was Cowdenbeath born and bred, and was always proud of his home town. He simply wanted to put back a little into the community that he loves so much.

The second thing that struck me was that clubs in the lower leagues operate with far more fiscal responsibility than some of the clubs in the top two flights of Scottish football. Perhaps it is because those involved in the running of lower league clubs are local business men and lawyers that they have a healthier respect for a balance sheet, and recognise that a club’s expenditure must not exceed its income. It is undoubtedly a source of frustration to many smaller clubs that every month

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they must account for every penny while the so-called big boys of Scottish football are able to rack up debts of hundreds of thousands, if not millions of pounds, with no obvious means of repayment.

Thirdly, it is worth noting that those who work behind the scenes at our smaller clubs often do so for little or no recompense, and would normally have no expectation of receiving any praise or credit. For example, on Saturday, I discovered that the tannoy announcer at Cowdenbeath FC is Mr Jim Stark, who was editor of the Central Fife Times. Behind the scenes, one of the key cogs in the functioning of a successful match day is Mr Alex Haddow, chairman of the local community council. Without the tireless support of such individuals, and hundreds of other community heroes, clubs such as Cowdenbeath and Brechin City would not function. The strength of feeling in clubs further up the Scottish leagues is equally strong, and due to the full-time nature of their clubs, arguably their roots go even deeper into their local communities.

For the sake of probity, perhaps I should declare an interest at this stage. I am not only a Dunfermline Athletic season ticket holder, but my constituency office is located within the club. Dunfermline Athletic—or the Pars—like many other clubs, has invested heavily in supporting youth and grass-roots football. Indeed, the club offers classes for children from 18 months and through primary school to introduce them to the game, and to build their confidence and interpersonal skills. Those classes, with the support of their parents, help to develop children’s motor skills, and they provide a fun and safe environment so that children can integrate and develop their characters. The emphasis is, rightly, on fun and enjoyment, but it is a crucial role, for which clubs receive no financial recompense, and fills a vital role in society—some might say the big society, which the Minister is so keen on. Beyond primary school, football clubs, like those south of the border, have successful youth academies. Dunfermline’s under-14s and under-15s recently visited the city academy in Manchester, and were able to take part in a contest against players from the likes of Manchester City.

The financial situation in Scottish football clubs in recent years has been dwarfed by their counterparts in the English leagues. I shall provide some context for the finances of Scottish football. The television sponsorship deal in Scotland is only approximately 1% of that south of the border. Outside the old firm, players’ wages in the Scottish premier league are typically only £1,000 to £3,000 a week, which is a fraction of that paid to players in the premiership, the championship, or even league one. To put it simply, the annual wage of a Dunfermline player is less than the weekly salary of a Manchester City, Chelsea, or Manchester United squad player. None the less, clubs such as Dunfermline are expected to compete with the giants of Scottish football.

The recent financial events at Rangers football club cannot be seen in isolation. Before I talk about the impact on other clubs of Rangers going into administration, it is worth recapping the saga at Ibrox. The origins of Rangers’ problems date back over two decades. In 1988, David Murray bought a majority shareholding in the club for approximately £6 million. Mr Murray invested heavily in building a team that could not only dominate the Scottish league, but compete with the best of Europe. Something that is often forgotten is that when Rangers,

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under Murray and Graeme Souness, were building their successful side, which would go on to win nine league titles in a row, English clubs were banned from competing in Europe, so Rangers were able to attract players from England who, to play in Europe, either had to move to Europe or travel north of the border to play for the old firm. The list of players at Rangers during the late ’80s and early ’90s was a “Who’s Who” of Bobby Robson’s England team. The names will be familiar to every English fan: Chris Woods, Terry Butcher, Trevor Sinclair, Gary Stevens, Trevor Steven, Ray Wilkins and Trevor Francis. They were great players in a great team.

Rangers were able to use their dominance and ongoing success to attract some of Europe’s best players, such as Brian Laudrup and Paul Gascoigne. Unfortunately for the club, their ambitions were never matched by their income, and in 2004 those debts peaked at a staggering £72 million. However, in the next few years, Rangers reduced their debt to some £30 million by the end of the decade, according to their annual accounts. In 2010, Mr Craig Whyte confirmed to the stock exchange that he was in talks with Rangers’ owners about a takeover. In 2011, Mr Whyte formally bought the club for a notional £1, having agreed to take on the club’s debts. He promised Rangers fans that he would be able to service those debts.

Mr Nigel Dodds (Belfast North) (DUP): I congratulate the hon. Gentleman on securing this debate. He referred to the history and the debts racked up by Rangers, but does he agree that that is commonplace today? Manchester City and Chelsea have massive debts, far in excess of what Rangers ever racked up. The only difference is that they have someone to stand behind those debts. The phenomenon is not new, and sadly it has not gone away, but it is not unique to Rangers.

Thomas Docherty: The right hon. Gentleman is correct. What is appalling about the Rangers situation, and has come to light in recent weeks, is that Mr Whyte did not have the money to service the debt. It has now transpired that in what I would regard as a most disgraceful act, Mr Whyte and cohorts borrowed money from Ticketus on the future sale of season tickets. In effect, Rangers fans paid for Mr Whyte’s ill-fated takeover; they are the losers, and I am sure that disgraceful situation will be recognised across the House.

Mr Gregory Campbell (East Londonderry) (DUP): I, too, congratulate the hon. Gentleman on securing the debate. He has raised an important issue about Craig Whyte and the apparently underhand way in which he acquired a controlling influence at Rangers football club. Does he agree that if football clubs could allow fans a greater degree of controlling influence, à la the Barcelona model or perhaps in the way alluded to earlier in respect of Cowdenbeath, it might move us away from the insidious controlling influences of multi-billionaires who appear to use football clubs as playthings?

Thomas Docherty: The hon. Gentleman is absolutely right. I see that the hon. Member for Portsmouth North (Penny Mordaunt) is in the Chamber. She has championed that model for Portsmouth FC, so perhaps she will be tempted to contribute to the debate. There are some

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good examples of that model in Scotland. I referred earlier to Brechin City which, as hon. Members may know, had on its board Mr David Will, the FIFA vice-president for the British Isles, and a local lawyer, steeped in Brechin City. There are successful models of clubs, both large and small, where the shareholders are the fans. I hope that the Treasury will look at ways of trying to ensure that a fit and proper person test means not only that liars such as Mr Whyte are not put in charge of clubs, but that we can all have comfort in club finances for the future.

Penny Mordaunt (Portsmouth North) (Con): I congratulate the hon. Gentleman on securing the debate, which I am attending as a Pompey supporter, so I share his pain and that of other hon. Members. We too have been badly let down, but I hope that the supporters’ trust will soon have a financial stake in the club.

Does the hon. Gentleman agree that when Her Majesty’s Revenue and Customs deals with clubs in such situations, it is important that it considers the club as a distinct entity, and does not tar it with the sins of the whole football community going back over many years? That has been my experience of the way that HMRC dealt with Portsmouth, and I would like to put on the record my thanks to HMRC staff, and to the Minister for facilitating dialogue. I hope that Rangers and other clubs have similar success.

Thomas Docherty: I am grateful to the hon. Lady for those comments. She has been a staunch champion of Pompey’s interests, and I know that she badgered the Minister on more than one occasion to ensure that the club got a fair hearing. She is right to say that each club needs to be considered on its own merits, and I will perhaps return to that point during my remarks.

Thanks to the Scottish press, which has been assiduous in trying to get to the truth of this sorry affair, it has been particularly disturbing to discover in recent weeks that HMRC has been engaged in a long-standing battle with Rangers over what the Treasury believes, and I believe, is a tax-avoidance scam instigated by David Murray. If Rangers lose this ongoing court case, it has been estimated that the club will owe HMRC somewhere in the region of £45 million in unpaid taxes from over the past decade.

On 9 January 2012, shares in Rangers were suspended from trading on the PLUS stock exchange for failure to submit audited accounts—alarm bells should have rung at that point. Mr Whyte, however, dismissed it as unimportant because he was by then, he argued, the dominant shareholder. On 5 February, Rangers were knocked out of the Scottish cup by Dundee United at Ibrox. On 11 February, Dunfermline hosted Rangers in the Scottish premier league. Finally, after months of speculation, on Monday 13 February, Rangers lodged their intention to enter administration at the Court of Session. Mr Whyte told reporters that, in his estimation, the club’s final tax bill could amount to £75 million—an astonishing amount. The following day, the club appointed Duff and Phelps as administrators. The SPL deducted 10 points from Rangers, which left them 14 points behind Celtic.

Rangers entering administration has not simply changed the dynamic of the title race but has had a devastating impact on three groups of people: first, the staff—both playing and non-playing—of Rangers FC; secondly,

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the companies that are owed money by Rangers as creditors; and thirdly, the other 11 members of the Scottish premier league, which is the group that I wish to raise with the Minister today.

No one should have anything other than sympathy for those who face losing their jobs at Ibrox, in particular those who work behind the scenes and are not millionaires, and who will not easily find employment in the current economic climate.

There are two distinct yet equally important categories of club. Two clubs in the SPL have claimed that they are owed money by Rangers for ticket sales, and I will explain their situation for the benefit of the House. Under the rules of the Scottish Football Association and the SPL, the total gate receipt for a league game belongs to the home club. It is standard operating practice for the away club to sell tickets for their end of the ground, but under the rules of the league, that money must be paid to the home team within seven days of the fixture taking place, minus any pre-agreed handling fee. The money is not the property of the away team, which is merely the handling agent.

For games in the Scottish cup, however, ticket sales for the whole ground are split equally between the two clubs, minus any operating costs, and the home team get to keep any proceeds from hospitality, refreshments, or programme sales. Under SFA rules, the two teams that have sold tickets do not have any right to count those ticket sales on their balance sheets, as they are merely holding agents and the money is to be put into the pool of gate receipts for the cup tie as a whole. In other words, the two clubs are merely acting as agents; it is not their money.

When Rangers entered administration, the club and its administrators, Duff and Phelps, refused point blank to hand either amount of money to Dundee United or Dunfermline, arguing that it should go into the pot of credited money. Let me be clear and send a message to Rangers’ administrators: that money does not belong—and has never belonged—to Rangers. Holding on to it is not only morally wrong, it is nothing short of theft.

What makes matters worse is that members of the Rangers board of directors were in the directors lounge at East End Park on the Saturday in question. They looked their counterparts in the eye, and told them that on Monday the money would be transferred to Dunfermline Athletic by BACS payment. It is utterly inconceivable that on that Saturday afternoon, the board of directors, which included Mr Ali Russell, did not know that on Monday afternoon they would be filing papers with the Court of Session. For the two clubs involved, despite the support of the SPL and the SFA, it will probably take months to recover the money to which they are legally and morally entitled from Duff and Phelps.

The second category of club involves any club in Scotland—or elsewhere—that has entered into financial transactions with Rangers, for example over the transfer of players. We know that at least one club, Heart of Midlothian, stated that it is owed close to £1 million for the transfer of a player to Rangers. It is in a more complicated situation—one that you will be familiar with, Mr Betts—concerning the rule of football first creditors. As I understand it, Scotland does not have the same rules as England about football first creditors, but that is an issue of ongoing legal dispute between the clubs, HMRC and the creditors.