3.32 pm
John Stevenson (Carlisle) (Con): I congratulate my hon. Friend the Member for Cleethorpes (Martin Vickers) on securing this debate, which is incredibly timely given that we have elections in eight days. He mentioned that I initiated a debate on this very subject about 18 months ago, when probably one or two fewer hon. Members attended than are here today. Interestingly, Sir Peter Soulsby was there and went on to become an elected mayor. It will be interesting to see whether any hon. Member here today subsequently becomes an elected mayor.
I said during that debate 18 months ago that the idea of elected mayors was flying below the radar, and that is probably still the case to a certain extent, but I believe that they have the potential profoundly to transform our democracy. Perhaps things are beginning to change in the sense that referendums will be held in 10 of our great cities next week. In addition, three mayoral elections will take place at the same time: in London, which we all know about, Liverpool and Leicester.
The UK started its journey back in 2000, when the Labour Government introduced the concept of elected mayors; but unfortunately, for whatever reason, it never took off. I am delighted that the present Government have taken up the baton. There is still cross-party support—two great advocates are Lord Heseltine and Lord Adonis—
25 Apr 2012 : Column 304WH
and it is great to see other parliamentarians taking an interest. There have been 38 referendums, and only 14 have said yes, which is shame, but I think that is partly because local politicians have been resistant to the idea and national politicians have not been willing to drive it forward and promote it. Again, I think that is changing. Some councils are using their two-thirds majority to introduce elected mayors, as Liverpool and Leicester have done; some have gone for majority decisions to call referendums; and there has been the odd petition; but the 5% threshold is putting many people off, and I will raise that with the Minister in due course.
I am conscious that I do not have much time, so I shall concentrate on two aspects. First, I believe that elected mayors can be a huge benefit to local government. In this country, we often underestimate the importance and significance of local government. Local councils already have powers covering planning, procurement, economic development in their own areas and housing issues, but our politics are dominated completely by the centre, and that is fundamentally wrong. We underestimate what powers they already have and could use, but often do not use effectively. Elected mayors will be personalities who are transparent, known and visible to their local community, and they may be willing to use existing powers more effectively.
I want to encourage the Government to continue what I think they are starting to do: to continue the decentralisation process and to give greater powers to local government, whether using the elected-mayor model or the present model. Our country is far too centralised, and we need to spread power out. We have done that successfully in Scotland and Wales, and there is no reason why we cannot do so in the rest of the country.
If mayors are elected for a four-year term and have a mandate from the local people, they have the opportunity to implement their manifesto. At present, Carlisle city councillors are elected in thirds. That creates chaos, because they are never quite sure whether they will be in control. It is fair enough if the council has a majority that will carry it through two elections, but otherwise councillors are always thinking about the next election and not planning for the future.
Four-year terms, with good powers for elected mayors, will provide the opportunity to transform their localities. Not all elected mayors will succeed. There will be failures and eccentrics, but that is democracy, and we are part of a democracy. In four years, local people will have the opportunity to remove that person and to bring in someone else. People in the local area will decide who provides the leadership.
National politics will be transformed, and that is a real positive. At present, people come to Westminster, climb the greasy pole, and fall off, which is the end of their career. Now, we have the opportunity for national politicians, who may have made their name nationally, going out and doing something in their localities. Their national career may be over, but their local career might just be starting. They can be figureheads for the places that they came from, which is tremendous, because they would bring experience and contacts to their local areas.
The reverse is also true. I am amazed at how few nationally successful politicians have been council leaders. Elected mayors who are major politicians in their locality may ultimately become MPs. If they subsequently become
25 Apr 2012 : Column 305WH
Ministers, they would bring tremendous executive experience of running an authority, perhaps of only 250,000 people with a budget of £100 million, but they would have direct executive experience, which many hon. Members do not have. When Ministers are first appointed, they sometimes flounder because they do not have that experience.
I want to allow the maximum amount of time for the Opposition spokesman and the Minister, but I want to ask the Minister whether he will continue the commitment to elected mayors even if the referendum outcomes are not as we hope. Clearly, I should like all 10 cities to embrace the idea, but if only three or four do and others do not, is he committed to continuing the process? Will the Minister encourage further referendums for smaller cities, as has been done for the big 10? I would love Carlisle to have the opportunity to decide in a referendum whether to have an elected mayor.
Rory Stewart: Is my hon. Friend suggesting that we could have referendums for mayors in even smaller places, such as Penrith?
John Stevenson: I accept my hon. Friend’s point, and I do not see why not. If Cumbria, for example, had an elected mayor, smaller areas within Cumbria could easily have the same mechanisms and form of government.
At present, the 5% threshold has been a barrier to referendums and to people deciding to raise a petition in their areas and pursuing the idea of a referendum. I hope that that threshold can be revisited and, if possible, reduced to a level where it would be far easier for someone who believes in the idea locally to go out and obtain the requisite number of signatures. I look forward to the Minister’s response.
3.39 pm
Chris Williamson (Derby North) (Lab): It is a pleasure to serve under your chairmanship again, Mrs Main, and I congratulate the hon. Member for Cleethorpes (Martin Vickers) on securing this timely debate.
We all accept that there are various systems of local government, one of which—the executive mayoral system—already works perfectly well in a number of locations around the country. Hon. Members have spoken about executive mayors in glowing terms, but they are not necessarily a panacea. They can work extremely well, but so can alternative models of local government.
The previous Government recognised that the executive mayoral local government model has a place and can work well and offer strong leadership, and as a consequence, we legislated for it. As hon. Members have said, a petition needs to be signed by 5% of the population to meet the threshold to hold a referendum, but that is not an insurmountable barrier. If there is strong support in a local area for the introduction of an elected mayoral system, people will put their names to a petition and oblige the local authority to hold a referendum. If there is majority support, a mayor will be introduced. However, even when that 5% threshold has been reached and a referendum has followed, it has not always resulted in the introduction of an elected mayor. It is therefore important to put local people in the driving seat. If people want an executive mayor as their form of local government, they should be empowered to introduce one.
25 Apr 2012 : Column 306WH
The hon. Member for Penrith and The Border (Rory Stewart) mentioned the possible introduction of mayor in his area. Again, if there is support in the local community, and if he wishes, I urge him to secure a petition and get the 5% of signatures necessary to ensure that a referendum takes place. If there is support for the idea, the hon. Gentleman will have the mayor for whom he wishes.
I congratulate the hon. Member for Cleethorpes on his honesty. It seems that he does not really favour a margin of democracy but wishes to see mayors being imposed. I do not think, however, that that is how we should proceed, and for me it is important to ensure that local people are put in the driving seat, rather than seeking to impose a Westminster template on local people.
On 3 May this year, referendums will be held in the great cities of our country, although I must say that I resent the way that Ministers have imposed them on local communities. As I have said, if there is an appetite for an elected mayor and the requisite groundswell of support, a mechanism is already available to the local community to present a petition and hold a referendum. The Government claim to be localist and it is unfortunate that they are imposing these referendums on our great cities.
My right hon. Friend the Member for Coventry North East (Mr Ainsworth) talked about apathy. He makes a strong point because apathy is the real enemy of democracy. Such apathy, however, is not necessarily due to the mechanism through which we organise local government but, at least in my view, to the diminution in the powers available to local authorities and to the way that, all too often, national politicians and the media have continually run down and denigrated local government. I believe that local governments provide an invaluable service to local communities and deliver vital public services. They are a useful mouthpiece for the concerns of local people through the auspices of their locally elected councillors.
It is also unhelpful and adds to that sense of apathy when local governments are seen as a delivery arm for central Government—that applies to both parties, and we must start to move away from that. My right hon. Friend mentioned the difficulty that some people find in identifying their council leader, but to some extent that is also true about people’s ability to name their local MP. It is down to the dynamism, commitment and ability of locally elected representatives—whether councillors, council leaders or MPs—to ensure that their local communities know who they are.
Lilian Greenwood: Does my hon. Friend think that it matters if people do not know their council leader, as long as they know their councillor? Is it not more valuable to have 55 councillors coming up with collective solutions, with each bringing up the needs and wants of their ward, than a single elected person who is supposed to come up with all the solutions?
Chris Williamson:
I certainly think that the role of elected councillors is essential to local democracy. Dynamic and effective local councillors are a useful way for local people to raise their concerns, and more often than not, they are a great advocate for the communities that they represent. As well as asking whether local people want
25 Apr 2012 : Column 307WH
an executive mayor, we should be doing all we can to support, train and provide locally elected councillors with the necessary tools, to ensure that they can represent their communities as effectively as possible.
I do not think that there is evidence of a huge groundswell of support or a great appetite for elected mayors, and that is why I object to the Government’s imposing mayoral referendums. Obviously, if a majority of people support an elected mayor, they will be introduced in those areas. I suspect, however, that in a number of cities around the country, local people will vote to stay with the existing system and reject the Government’s proposal. People want decent public services, and I hope that the Minister will provide some reassurance about that. They want to see jobs and prosperity in their local community, and for their local authority to help secure economic development. That requires strong leadership, which, as I have said, can be provided by an elected mayor, but also by the existing model of a strong leader and cabinet.
We have seen evidence of that system around the country. In my home city of Derby, strong local government leadership has led to the complete regeneration and transformation of our city. The same is true of Nottingham, which is represented by my hon. Friend the Member for Nottingham South (Lilian Greenwood), where a real lead was taken to develop the transport infrastructure and the regeneration activities of the local authority have transformed the city. The same is true for Leicester, Manchester and Leeds. The transformational activities of a local authority can be achieved without the introduction of an elected mayor.
The hon. Member for Penrith and The Border touched on the need for us to rebuild democracy and said that perhaps we should look at devolving more powers to local government to achieve that. That is a goal that we should seek to accomplish. A few weeks ago, the Local Government Association published “Local Government’s Magna Carta”, which talked about putting local authority powers on a statutory footing, so that they cannot become a political football or the delivery arm of whichever Government are in power at the time. That is a way to rebuild democracy to support local authorities. Whether we adopt a system of elected mayors or retain the existing system, we need to guard against personality politics, which is the important point made by the hon. Member for Manchester, Withington (Mr Leech).
In conclusion, let me mention our party political system. Some hon. Members have been a bit embarrassed about our democracy. They seem to want to move away from our party political system, on which our democracy is based, towards personality-based politics. That is not a healthy way in which to run our democracy. I am proud of our party political system, and if a few more of us stood up for it and recognised that it is the foundation of our democracy, perhaps some of the criticism and the brickbats that we have seen in the media over the past few years would not be quite so pronounced.
Elected mayors have a role to play. They are not a panacea; they are one tool in the locker. Let us not put all our eggs in one basket. Let us allow 1,000 flowers to bloom. If local people want it, give it to them. If they do not, support powers for local government in a different form.
25 Apr 2012 : Column 308WH
3.51 pm
The Minister of State, Department for Communities and Local Government (Greg Clark): It is a great pleasure to serve under your chairmanship, Mrs Main, and to respond to what has been an excellent debate with some really first-class speeches. I congratulate my irrepressible hon. Friend the Member for Cleethorpes (Martin Vickers) on coming back to this subject. He seems to have momentum behind him these days. I had not realised that he had been rested in his political career, but he is certainly back with a vengeance, and I know we can count on his presence for many years to come.
It is an opportune moment to be debating this issue because we have, through the Localism Act 2011, the opportunity to hold referendums on whether there should be a mayor in what was originally going to be 12 of our cities. Already, two of those cities, Leicester and Liverpool, have decided not to wait for the referendum to take place and have, through a resolution of their local councils, decided to go ahead with elections. In the case of Leicester, our former colleague, Sir Peter Soulsby, is now the mayor, and a vigorous election campaign is currently being fought in Liverpool to elect the first mayor on 3 May. In the 10 remaining cities, the choice is there for their people. It is right that the choice rest with the people of those cities, and debates are currently taking place across the country.
There are three broad reasons why it is time for cities to consider the case for a mayor. We would not have created these referendums if we did not think there was strong case for the people voting yes. It is particularly true for our great cities that they do not simply compete as part of the United Kingdom with other countries; they compete with each other—whether Nottingham, Birmingham or Leeds. They compete with Barcelona, Bordeaux, Lyon, Frankfurt, Bangalore, Beijing and Shanghai. They are international cities that deserve an international champion to speak up for them on the international stage.
I was struck by a conversation that I had with Joe Anderson, the current leader and mayoral candidate for Liverpool—he is not a member of my party. He said that the penny dropped for him when he was representing his city at the World Expo in Shanghai. He was there talking to the Chinese authorities, seeking to make the case for inward investment into Liverpool. The officials said to him, “We can’t understand why all of these cities from around the world, Chicago, Frankfurt and so on, have sent their mayor to Shanghai to represent them and you have sent an official from the council.” Then he got into an explanation of the English municipal system, but by that stage the argument was lost and he recognised what was needed.
Last week, we had a debate in Nottingham, in the constituency of the hon. Member for Nottingham South (Lilian Greenwood). When we were talking about this issue, the deputy leader, Mr Chapman, gave us a fascinating insight. He said, “Whenever I’m on the continent and I need to explain who I am, all I say is, ‘Je suis le mayor.’” That says it all; if someone has to claim to be something they are not—something that every other city they are competing against has—surely that makes the case for the prominence internationally that our great cities deserve and have had over the years? Let us bear in mind that the cities we are talking about are already world renowned and they need to continue to be so.
25 Apr 2012 : Column 309WH
It is important also that those cities have a strong voice domestically. We all know the importance of our great cities. The reputation and standing of our cities is not what it has been in past decades and centuries. Not enough people in the country know what is going on in Leeds or Sheffield. They do not know the industries that are prospering. They do not know that Bristol is one of the most successful cities in the country in attracting investment into digital media. They do not know about the contribution that the digital gaming industries of Birmingham are making in the international world. They need to know not just what is going on there, but who the leaders of these cities are.
My observation as a Minister—and I know this from talking to Ministers from previous Governments—is that the contrast between the volume of the voice of our great cities and that of London is enormous. I dare say that more people in Nottingham, Birmingham, Sheffield and Leeds know the name of the Mayor of London than know the name of their city council leader. That cannot be right, and it is true nationally.
I have noted, as have my predecessors from previous Governments, that when the Mayor of London wants something, we know about it. We have to take the phone call. If we do not, we will find out what is needed for London through a megaphone. The right hon. Member for Coventry North East (Mr Ainsworth) made mention of this as well. Mayors demand more powers. For example, the Mayor of London has made a bold attempt to extend his transport powers. No one invited him to do that. He is perfectly properly standing up for the people whom he represents and, I hope, will continue to represent, and wants to extend his powers further. I want every city to do that. I want it to be a nightmare for Ministers that we have a legion of mayors from around the country banging the table, demanding more powers and making it impossible to say no. The Prime Minister has agreed to create a cabinet of mayors and to allow them to come and sit round the Cabinet table, and it is right that they should do so. The power of the existing mayors is enormous. The budget of the city of Birmingham is £3.5 billion a year, which is more than that of the Department for Culture, Media and Sport, in which my hon. Friend the Member for Wantage
25 Apr 2012 : Column 310WH
(Mr Vaizey) is a Minister. He may do better trying to become mayor of Birmingham. I am talking about very significant powers.
Lilian Greenwood: I thank the Minister for giving way; I am enjoying his speech. If the people of one of the great cities having a referendum next week, such as Manchester, Nottingham or Leeds, decide that they do not wish to have an elected mayor, is he suggesting that the Prime Minister and Ministers will not listen to those voices and invite them round the table?
Greg Clark: Of course the Prime Minister will listen to the voice of the cities, but if we are to create a cabinet of mayors—a cabinet equivalent to the Cabinet of Ministers—we want people with a mandate who can speak for all the people in the city. When the hon. Lady talked about Nottingham, I was disappointed that she talked it down. She said that it was too small to have an elected mayor. My goodness, this is a city that has two of the world’s greatest universities, with research and development facilities that are a beacon to the world, two football clubs and test cricket. Nottingham can punch higher than it does at the moment.
Greg Clark: I have two minutes left, so I must make progress.
Nottingham could benefit from greater powers. In fact, what the hon. Lady said should be a clarion call to the people of Nottingham to raise their ambitions and to live up to what they are capable of. The city could once again be renowned nationally and internationally. To do that, it can only help to have someone who speaks for the whole city and who has a four-year programme that they have put before the people to bring change to the city. That will be available to every city after the referendums next week. I hope that the people will take the opportunity to say yes. In 100 years’ time, in all of these cities that say yes, we will look back on a succession of mayors to whom people are erecting statues because they have done great things for their cities. We will look back at an historic change that will be for the good of the cities and for the whole United Kingdom.
25 Apr 2012 : Column 311WH
Local Newspapers
Mrs Anne Main (in the Chair): I note that we have a full Chamber. The hon. Member for Corby (Louise Mensch) has indicated that she will take interventions, but may I ask that they be kept brief, or I will ask for them to be curtailed?
4 pm
Louise Mensch (Corby) (Con): Thank you, Mrs Main. It is a delight to see this debate so well attended by hon. Members from all parties. Although this is a particularly heavy news day, it is nevertheless appropriate that we debate local news, because local papers remain, despite not grabbing the headlines, the single most popular print medium in the UK. They are read by almost 70% of the adult population and have a cumulative readership of some 33 million readers per month.
In 2009, Ofcom noted that local newspapers were, far and away, the most trusted news organisations in the country.
Gloria De Piero (Ashfield) (Lab): Local papers are essential for local democracy. Members might all like to think that people with concerns come straight to us, but they often go to the local paper, which they trust. We often read it and that enables us to do our job. I thank the hon. Lady for securing this debate.
Louise Mensch: The hon. Lady is right. I intend to mention local accountability later.
Robert Halfon (Harlow) (Con): I congratulate my hon. Friend on securing this important debate and for kindly giving way. In Harlow, we have gone down from three local newspapers to one in the past few years. Unlike the BBC, which has the licence fee, local newspapers do not have a compulsory subsidy. Does my hon. Friend agree that it would be fair for the Government to continue to put transport and traffic notices in local newspapers to ensure that they survive?
Louise Mensch: I agree. Later, I will mention substantively the remedy for falling circulation and the lack of a good business model for local newspapers.
Karen Lumley (Redditch) (Con): I thank my hon. Friend for securing this debate. Does she agree that papers such as the Redditch Standard help our elderly people, who do not have e-mail or other access to local news?
Louise Mensch: Indeed. If hon. Members will forgive me, I will make a tiny bit more progress. On that important point, Johnston Press, which manages a large group of notable newspapers throughout the country, recently cut a handful of its titles. The Corby Evening Telegraph is one of those titles and is moving from being a daily to a weekly paper. That newspaper group runs more than 1,000 titles throughout the land.
The threat to our local democracy is severe. Often, only the local press will hold an incumbent Member of Parliament or a local council to account, because only the local press and only local people really care. We all support our local radio stations, both commercial and
25 Apr 2012 : Column 312WH
BBC, but as all hon. Members in the Chamber know, five minutes is an eternity in broadcast terms: local papers can really go into a story.
The history of the local press is illustrious. In 1965, The Northern Echo successfully campaigned for a posthumous pardon for Timothy Evans; in 1977, the Lancashire Telegraph successfully exposed the corruption of chief constable Stanley Parr; and in my constituency, the Corby Evening Telegraph led the way on the attempted suppression of a local report.
Mr Ben Bradshaw (Exeter) (Lab): Although I agree that it is always sad when a local newspaper goes from daily to weekly, as the Exeter Express and Echo in my constituency has recently, does the hon. Lady also accept that sometimes the economic reality means that if that does not happen, there will be no quality print journalism sustained in that community?
Louise Mensch: I agree that half a loaf is better than no bread, but an important part of my speech is to ask the Minister to assess, in his reply, whether direct or indirect Government subsidy ought to be given to our local press. In the Government’s plans for local television stations, for example, an indirect subsidy is proposed, whereby the BBC will be compelled to take content and pay for content arising from local television stations.
My right hon. Friend the Secretary of State for Communities and Local Government has rightly cracked down on local free sheets that, for so long, have been cannibalising at tax and rate payers’ expense the markets for our local papers. Unfortunately, that might have come partially too late to save some papers. The question for the Government is this: is the local press worth having; is the local press worth saving; and can an iPad app ever be a substitute?
Brandon Lewis (Great Yarmouth) (Con): I thank my hon. Friend for being so generous in giving way on a very popular topic. In Great Yarmouth, we have a local newspaper, the Great Yarmouth Mercury, but we also have a daily regional paper, the E astern D aily P ress, that is the biggest selling newspaper—in fact, it outsells all the national dailies. The EDP is a campaigning newspaper, so it clicks in with what the people of Norfolk and north Suffolk are interested in. That is a good example of how a newspaper can move forward without subsidies.
Louise Mensch: The Eastern Daily Press is an absolute star and gem of a newspaper. However, I am sure that my hon. Friend would agree that what he mentions is not a substitute for a properly localised paper that can address the concerns of local people. In my constituency, the glories of Corby and of east Northamptonshire are very different and the concerns of people in east Northants and Corby are extremely different. It is wonderful that we have local papers that cover both areas.
Ian Paisley (North Antrim) (DUP):
The Guardian—the Ballymena Guardian—and the Times—the Ballymoney Times and Ballymena Times—are some of the most important papers in my constituency. They attract a readership of more than 80,000 people each week, yet our daily papers—the Belfast Telegraph, The Irish News and News Letter—attract half that readership. The best
25 Apr 2012 : Column 313WH
way for the Government to assist such papers is to make sure that all their advertising goes into our weekly papers instead of our daily papers.
Louise Mensch: It would not be for me to propose a knee-jerk solution to the problems of local papers and their declining readership. It is a fact that local newspaper readership has been declining and that big newspaper groups cannot make this work. I only ask the Minister in his reply to announce that the Government will have a review into local democracy and the local press. I ask the Government to look at what they can do—whether, indeed, the placing of advertisements to support local papers or whether we can look at community models of ownership, such as those successfully trialled in football supporters’ trusts, for communities that wish to take over and run their local papers.
The best brains in the Department for Culture, Media and Sport ought to turn their talents to addressing this problem because, otherwise, the greatest winners will be incumbent politicians. We campaign in our local papers and those of us who took seats at the general election remember how important it was whenever we managed to get a story into the local paper and whenever our opponents did. I will be generous enough to mention the name of my opponent, Andy Sawford, who was Labour’s parliamentary candidate for Corby and east Northamptonshire. It is only right that he should be able to publicise his campaigns in the same way that I publicised my campaigns against my predecessor, Phil Hope, when I took the seat from him. That is a vital part of our local democracy. We do not wish to entrench incumbency.
Of course, as a Conservative, I am naturally suspicious of subsidies. However, let us consider the narrow interests that are subsidised by the Government, the broad range of funds to which national lottery funding is supplied and the indirect subsidy in the case of the licence fee, such as that proposed to support local television stations. We need to ask ourselves whether we wish to support a level playing field for local press. If the BBC is supported by taxpayer-funded subsidies, council free sheets are supported and local television stations are indirectly supported by a compulsion for the BBC to buy their content, why should local newspapers posses none of those advantages when they offer an irreplaceable function?
Simon Kirby (Brighton, Kemptown) (Con): Does my hon. Friend agree that, in marginal seats such as mine, The Argus and the Sussex Express serve the very purpose that she outlines in making sure that incumbency is not too strong a factor? Such papers hold MPs to account and ensure that they do a good job.
Mr Robin Walker (Worcester) (Con): I am very proud to have in my constituency the oldest continuously running newspaper in the world, Berrow’s Worcester Journal. The editor of that newspaper has urged me to make the point that it is not only a question of the value for money that the Government get out of their advertisements in the press; it is also a question of trust. As my hon. Friend pointed out, people have greater trust in what they read from newspapers.
25 Apr 2012 : Column 314WH
Louise Mensch: I agree completely. If we agree that, in some cases, state subsidy—whether direct or indirect—is justified, we need to ask ourselves whether newspapers along with other organs are a worthy recipient of that at local level. I come again to the irreplaceable point that local democracy is best served when there is an organ that can hold local politicians to account in a thorough way. At the same time, when we consider our local papers and their value to the community, it is not merely the fact that they hold our feet to the fire in our constituencies; it is how keenly they are at the heart of rural and urban life in our communities.
Jim Shannon (Strangford) (DUP): Local papers clearly have a contact with each of the villages and hamlets in my constituency. My local paper, The Newtownards Chronicle, contains local stories for people who live in the area. Does the hon. Lady feel that it is important not just to have local stories, but advertising? That is the success of a local paper—its interaction with the community.
Louise Mensch: Yes, I do indeed. When part of that advertising comes from Government and the local council, it is important to create a level playing field over various forms of media. The BBC is a national treasure, but when it goes to hyper-localism in its websites and reporting, it creates a very difficult behemoth for local commercial papers to compete against. Council free sheets have been the single biggest cannibal of the markets of local papers. Research sent to me by Retail Newsagent Magazine states that more than £5 million will be wiped off local newsagents in the future. It is not merely the 10,000 journalists that local newspapers employ, but the subsidiary trade that they bring to their areas and to newsagents that rely on passing trade and footfall, as people come in to buy their local paper every day.
Mrs Linda Riordan (Halifax) (Lab/Co-op): I congratulate the hon. Lady on securing this important debate. Does she agree that the local economy of towns such as Halifax will suffer another blow when they are already suffering from job losses in the banking sector and the public sector?
Louise Mensch: I do indeed. Now is not the time to wipe out our local press.
Dr Sarah Wollaston (Totnes) (Con): My hon. Friend is being most generous. As everyone knows, she is prolific and effective in her use of new media. It is wonderful to see that she also supports traditional media, too; papers such as South Hams Gazette in my constituency, which does a fantastic job. I agree with her completely that this is not about subsidy. Supporting advertising through our local press is the best way to support democracy.
Louise Mensch: Yes, indeed. There are direct and indirect forms of subsidy. The Government should be considering that, rather than writing out a cheque to local newspaper groups, which is not at all what I propose.
Mr Mark Williams (Ceredigion) (LD):
I am not deviating from what the hon. Lady and other hon. Members have been saying about the need for advertisements—my local paper, the Cambrian News, will be very glad to
25 Apr 2012 : Column 315WH
hear about that—but will she not leave the issue of subsidies completely? We have a system of
Papurau Bro
local Welsh language newspapers that have been in receipt of funds from our National Assembly Government, so there is a precedent in Wales.
Louise Mensch: Yes, indeed, but that is slightly different because the preservation of the Welsh language and culture is an overriding national concern. Just as we subsidise Welsh television channels, it is quite right and proper that Welsh language outlets should be subsidised—it is a slightly different matter. I repeat that indirect subsidy is already there for a number newspapers, outlets and organs that compete with our local press. I am concerned that the Government should provide a level playing field. I will give way to my hon. Friends, and then, I am afraid, I must conclude my speech.
Andrew Griffiths (Burton) (Con): I thank the hon. Lady for giving way and bringing to us the parliamentary equivalent of speed dating. She will know that I am lucky enough to have that august newspaper, the Burton Mail, in my constituency. It is not only a centre of information, but a great champion for my local community. It has raised with me the concerns that my hon. Friend the Member for Harlow (Robert Halfon) raised about the impact of the Department for Transport withdrawing its advertising in newspapers. That will force newspapers to close. Should it not change its mind?
Louise Mensch: It should indeed change its mind. There is absolutely no justification for the Government withdrawing advertising support when they provide subsidy for various other types of media.
Dr Thérèse Coffey (Suffolk Coastal) (Con): Does my hon. Friend agree that a free press is the hallmark of a free society? Councils may be looking to save money, but starving newspapers of that will be worse for democracy rather than better.
Louise Mensch: I agree with my hon. Friend. We have to look at the press as a special case. Local newspapers, as I said at the beginning of my speech, perform an absolutely irreplaceable function in our democracy. Nobody else will be interested in the malfeasance of our local councils. Few people will be interested in the expenses scandals or otherwise of those of us who are on the Back Benches and not of ministerial rank—I almost said “fodder” but, fortunately, I stopped myself. I have every sympathy with my hon. Friend the Member for Brighton, Kemptown (Simon Kirby), because I took a marginal seat from Labour at the previous election and, in those marginal areas, it is absolutely vital that both the candidate and the challenger can put their case in the local media.
We have not had much time in the debate, because many hon. Friends and hon. Members wanted to intervene and to praise their local papers, which are at the heart of their communities. We all grew up with the softer, nicer stories and the pictures of schoolchildren celebrating St George’s day, of country fêtes or of town centres cleaning up after riots. All those sweet little stories might not grab national headlines, but they are nevertheless—I say this with complete sincerity—at the
25 Apr 2012 : Column 316WH
heart of our national life and our national communities, and they deserve preservation as much as an arts or theatre group or anything else that the Government are prepared to subsidise directly or indirectly. I ask the Minister to give every hon. Friend and hon. Member in the Chamber some hope that the Government will look again at the plight of the local press, at the creation of a fair level playing field and at the indirect subsidies proposed for local television stations, which will be a further competitor for local newspapers, with the BBC required to buy their content. In particular, can the Minister press colleagues in other Departments to continue advertising in local newspapers?
At the same time—not that one usually ever has to press the great and wonderful Secretary of State for Communities and Local Government to any kind of action—when he is stamping down on council free sheets, I hope that he will look again and do it with ever more vigour, because it is completely unfair and wrong for ratepayers to be asked to subsidise something that puts their local paper out of business. All we ask for is a little fairness to preserve something that is so important in our national life. I look forward to the Minister’s reply.
4.17 pm
The Parliamentary Under-Secretary of State for Culture, Olympics, Media and Sport (Mr Edward Vaizey): It is a great pleasure to serve under your chairmanship, Mrs Main. I congratulate my hon. Friend the Member for Corby (Louise Mensch) on securing this important debate. My hon. Friend the Member for Burton (Andrew Griffiths) compared it to speed dating but, as I heard the various interventions, it seemed more like the parliamentary equivalent of “Just a Minute”. The great deal of interest in the debate on the part of colleagues might not be unrelated to the fact that, last time I debated local newspapers, I managed to secure half a page on page 7 of my excellent local weekly, The Didcot Herald.
Lisa Nandy (Wigan) (Lab): There is often good coverage in my local newspaper, the Wigan Evening Post, but it is not always comfortable, as should be the case. As the Minister knows, Johnston Press, which recently announced huge losses, employs people in Wigan and elsewhere. Can he tell us whether he can get some assurances from the management of Johnston Press for staff who are obviously concerned about their future?
Mr Vaizey:
I thank the hon. Lady for her contribution, and I should also mention the excellent contributions of my hon. Friends the Members for Harlow (Robert Halfon), for Redditch (Karen Lumley), for Great Yarmouth (Brandon Lewis), for Brighton, Kemptown (Simon Kirby), for Worcester (Mr Walker), for Totnes (Dr Wollaston), for Ceredigion (Mr Williams), for Suffolk Coastal (Dr Coffey) and for Burton; of the right hon. Member for Exeter (Mr Bradshaw); and of the hon. Members for Ashfield (Gloria De Piero), for North Antrim (Ian Paisley), for Strangford (Jim Shannon) and for Halifax (Mrs Riordan). As Minister for fashion, I normally go out of my way to praise the sartorial elegance of my hon. Friend the Member for Corby, so I hope she does not think me ungallant if I make the point that today
25 Apr 2012 : Column 317WH
she is eclipsed by my hon. Friend the Member for Harlow who, in the parlance of fashion, is wearing a powder-blue corduroy suit with a rainbow accessory tie.
The issues are important and, as the hon. Member for Wigan (Lisa Nandy) indicated, local newspapers are under significant pressure. I was in touch with Simon O’Neill, the editor of The Oxford Times in my constituency, and he pointed out that between 2006 and 2011 the turnover of Oxfordshire publishing businesses halved, they closed their district offices and editorial numbers declined by 40%. He is also a man whose glass is half full, however, and he made the point that his own newspapers between them employ more journalists than all the other media outlets in Oxfordshire combined.
Mr Vaizey: I make it clear that I will happily accept as many interventions as hon. Members wish to make.
Robert Halfon: I thank the Minister for his kind comments about my suit. The Harlow Star is delivered to almost every home throughout Harlow free of charge, and it and many other local newspapers depend on traffic notices. Many old people—we have 11,500 pensioners —do not use the internet and depend on traffic notices from their local newspaper. Will he lobby the Department for Transport to ensure that traffic notices are kept in local newspapers?
Mr Vaizey: I hear what my hon. Friend says. Obviously, I was going to cover the consultation on traffic regulation orders conducted by the Department for Transport. The consultation opened in January and this is the second time we have debated it in the House, which is a reflection of the importance that hon. Members attach to this subject. When we debated the matter previously, I urged all hon. Members to make their own submissions on behalf of their local newspapers.
The consultation closed last Monday. I understand that last week, the Under-Secretary of State for Transport, my hon. Friend the Member for Lewes (Norman Baker), met representatives of newspaper groups. The Department for Transport is taking this seriously. I would not like to pre-empt the conclusions of that consultation. I made the frank points in the previous debate that there is a balance to be struck between saving the taxpayer money, effectively, by not having a statutory requirement and by deregulating, and recognising that local newspapers in particular depend on statutory notices for part of their revenue.
Nick de Bois (Enfield North) (Con): This Government have pioneered transparency in local government finances with a requirement to publish such information. Anyone who has waded through it will see reams of pages. If the local press are not around to do that, few others will. Does the Minister agree that this is a real threat to local democracy and transparency, as wonderfully exemplified by the Enfield Independent and the Enfield Advertiser?
Mr Vaizey:
As I said earlier, we should recognise that local newspapers take their responsibilities in this area seriously. The editor of The
Oxford Times, Simon O’Neill, made the point that, although it has had radically to reduce its headcount because of commercial pressures,
25 Apr 2012 : Column 318WH
nevertheless it has tried to do that in the back office. I regret anyone’s losing their job, but that paper has focused on maintaining the quality of its journalism.
Eric Ollerenshaw (Lancaster and Fleetwood) (Con): On the point made well by my hon. Friend the Member for Corby (Louise Mensch) about the uneven playing field in terms of council so-called free sheets, might it help the market to require councils to charge for each free sheet and thereby see how many they sell? That would bring competition back into the local market.
Mr Vaizey: As my hon. Friend is aware, my right hon. Friend the Secretary of State for Communities and Local Government made it one of his priorities when we came into office to consider council free sheets. We introduced a code of recommended practice a year ago, at the end of March 2011. Local authorities have to take account of that statutory guidance, restricting the number of newsletters that local authorities can issue quarterly. For example, I know anecdotally that Hammersmith and Fulham now produces its own free sheet as part of the local newspaper, the Fulham and Hammersmith Chronicle. So in effect, rather than being a competitor of the local newspaper, the council has ended up subsidising it, if one wants to use that word.
Fiona Bruce (Congleton) (Con): Does the Minister agree that a fully independent, strong local paper such as the Congleton Chronicle, the strength of which is in its independence, makes a unique contribution to strengthening community life—in many ways acting as its glue—for just a few pence a week? Will he join me in congratulating the paper, which is bucking the trend that we have heard about today by having not only three long-running titles—the Congleton, Sandbach and Biddulph Chronicles —but this year launching a new title, the Alsager Chronicle, which is proof that a well-resourced and supported independent local paper can flourish in the internet age?
Mr Vaizey: I happily join my hon. Friend in congratulating that newspaper on its success. Well-run local newspapers producing content that local people want to read will be successful.
I was interviewed recently by GQ M agazine, which my hon. Friend the Member for Corby is familiar with, about how to get elected to Parliament. I made the point, which I think hon. Members would agree with, that a page in a local newspaper is worth much more, still, than a Facebook campaign. That is worth remembering.
Anne Marie Morris (Newton Abbot) (Con): Will the Minister join me in congratulating my Herald Express, which won the national award for creative bravery when it converted from being a daily to a weekly? If he wants some advice and guidance about how to do it yourself and get it right, that is a good example: that paper did it, and kept the sales and circulation.
Mr Vaizey:
I join my hon. Friend in recognising the achievement of her local newspaper in receiving that award and in moving from a daily to a weekly. That echoes the point made by the right hon. Member for
25 Apr 2012 : Column 319WH
Exeter—that, although painful to say it, it is better that a newspaper survive and prosper, albeit in a different format, than close entirely.
Mark Menzies (Fylde) (Con): All three of my local papers, the Blackpool Gazette, Lytham St Anne ’ s Express and the Lancashire Evening Post are Johnston Press papers. I urge the Minister to seek a meeting with senior management at Johnston Press to see in what practical ways we can help.
Mr Vaizey: I thank my hon. Friend for that intervention, which reminds me that I was remiss in not addressing the point put to me by the hon. Member for Wigan. I have called the managing director of Johnston Press and hope to have a meeting with him, simply to engage with him and hear his strategy. As a matter of principle, it is not the job of Government to tell a commercial business how it should be run or what its requirements are.
Ashley Highfield, the new managing director of Johnston Press—I knew him at the BBC when he was putting together the iPlayer, and he was then at Microsoft—has been hired because of an explicit recognition that we are moving into a digital age. Members will say that not everyone has an iPad yet, and it is still important to maintain the traditional format of a local newspaper, on which so many of our constituents still depend to get their local news.
Louise Mensch: Not only does not everyone have an iPad at this stage, but residents in my constituency of Corby were unbelievably insulted to be told that the Corby Evening Telegraph would be replaced by an iPad app, which excludes both people on low incomes and elderly people who are not familiar with the internet. I firmly agree with the Minister that a Facebook campaign is no substitute. He is, like me, a great lover of social media. Does he not recognise, as I do, that we will lose much photojournalism and in-depth coverage if we switch from true local stories to a couple of tweets?
Mr Vaizey: Yes. I should say that I often get myself into trouble making offers to Members; but, as and when I am able to set up a meeting with the managing director of Johnston Press, I will issue an open invitation to that meeting to all Members who may or may not have had the opportunity to meet him, so that they can put their points to him. It would be useful for him to hear from the grassroots. We Members of Parliament can forget that we are the grassroots of our communities.
25 Apr 2012 : Column 320WH
Jim Shannon: So far, no Member has mentioned the opportunities that come through local papers for those starting on the first rung of journalism. They go from local and provincial papers to national papers, and on to TV and radio. Many people in Northern Ireland depend on that. Does the Minister feel that that cannot be replaced?
Mr Vaizey: The hon. Gentleman makes his point. Time and again, we hear about the much wider impact of local newspapers, not just in delivering news to their local communities but the tangential impact on skills and training. That is why, for example, to return to my own patch in Oxfordshire, I am heartened that there is a drive by the editor-in-chief, Simon O’Neill, to continue to invest in journalism because of the recognition that quality journalism sits at the heart not just of the success of local newspapers, but of media generally.
Simon Kirby: Does the Minister agree that local newspapers often create a fertile environment for other print publications, such as Love Brighton, What’s Happening and The Latest magazines in Brighton and Hove?
I shall wind up the debate, but I will not prevent any further interventions—
Jonathan Lord (Woking) (Con): I have to inform the Chamber that, unfortunately, the long-established Woking News and Mail closed a few months ago, but a new Woking News and Mail, which started as a monthly publication, is now fortnightly and supplements the excellent coverage of the Surrey Advertiser. Surely, if the demand is there people will buy the local press.
We have relaxed the media ownership rules to allow local newspaper groups to merge; we have conducted a consultation on traffic regulation orders, which has just concluded; we have restricted the use of council free sheets; we have introduced local television, which I think will supplement and support local newspapers; and we continue to support community radio. Above all, the message goes out from the House and from this lively, well-informed debate about the passionate support in this House and among our local communities for our local newspapers. I will happily organise a series of meetings with the managing directors of newspaper groups, whether Johnston Press, Newsquest or Northcliffe, if Members would find that helpful.
25 Apr 2012 : Column 321WH
Outsourcing (Government Departments)
4.30 pm
Grahame M. Morris (Easington) (Lab): I am grateful, Mrs Main, for this opportunity, and it is a privilege to serve under your chairmanship for what I believe is the first time. Today, I hope to raise a very important issue, put down a few markers and seek some answers from the Minister to a series of questions that I will pose. I want to place on record my thanks to the Public and Commercial Services Union, the TUC and Unison for various pieces of briefing information that they have provided in support of my efforts today.
When the Minister for the Cabinet Office and Paymaster General was Financial Secretary to the Treasury under John Major, he sought to
“extend competition in the provision of public services further and faster than ever before”.—[Official Report, 18 November 1991; Vol. 199, c. 25.]
He said that he would do so with no bias between public and private sector providers. It must surely have been a setback for him personally that, shortly after setting out that agenda, his then constituents in the North Warwickshire constituency decided to ditch him at the 1992 general election in favour of Labour representation. However, in 1997, he returned to Parliament in the far safer Conservative seat of Horsham and he waited patiently for 13 years in opposition before returning in 2010 to his privatisation agenda of 20 years earlier to make private everything that is public.
I give this preamble only to set out the context of the debate: we can all understand that an individual who has waited 20 years to achieve his ambition may be more keen to implement his policies and to do so somewhat quicker than otherwise would be the case. Indeed, the right hon. Gentleman has made his intentions clear. In June 2011, he spoke to the business community on the subject of public service reform, saying:
“Spending cuts are one-offs. What we need to do, and are doing, is fundamentally change the way we operate.”
However, the problem with the coalition Government’s approach is that it is not evidence-based; it is ideologically driven. Whether they are outsourcing services, opening them up to a range of providers or decentralising them, the Government are gambling with the nation’s hard-won assets.
Jonathan Lord (Woking) (Con): We seem to be hearing a political diatribe against outsourcing. What would the hon. Gentleman say the previous Government were up to when they successfully outsourced many services? Indeed, many Labour councils, as well as Conservative and Liberal Democrat councils, followed in the footsteps of those pioneering Conservative councils of the early 1980s, by outsourcing services to give people a better service at lower cost.
Grahame M. Morris: The basis of my argument essentially is that there is no evidence base for that approach. If the hon. Gentleman will allow me to develop my argument a little further, I hope to illustrate that point.
If we look at the evidence base, it is in fact a constant lesson from history that reform has often come, as the hon. Gentleman has indicated, in the form of privatisations and outsourcing, but it has not always led to service improvement. Whether the justification for such reform
25 Apr 2012 : Column 322WH
has been a desire to bring perceived good practice from the private sector into the public sector or, indeed, the belief that savings can be made through outsourcing, the question that we parliamentarians must ask the Government and that I wish to put to the Minister is this: where is the evidence for those reforms?
I hope that the Minister will address this issue, which is about the economic and social evidence base rather than an ideological base that is behind what seems to be a rush to sell off services and public assets. It is my contention that the Tory-led policy on public services reform that is being followed by the coalition is ideologically driven and light on any such evidence base. I want to develop that point by presenting some evidence to suggest that the Government are on the wrong side of public opinion and, indeed, wrong about the whole issue of public service reform.
I hope that the Minister is aware of a report by Ipsos MORI entitled, “What do people want, need and expect from public services?” The report presents the most up-to-date and detailed data on current public attitudes to public services and public service reform. I want to put three headline findings on the record. First, people
“want public services to be based on notions of the public good, rather than just what’s good for me”.
“understand the public good largely in terms of universalism, with equality of access to benefits”.
“struggle to see a compelling or urgent case for reforming public services to cope with economic pressures and social changes”.
Gloria De Piero (Ashfield) (Lab): Does my hon. Friend agree that there are different interpretations of public sector reform? For example, Labour set up academies in areas of high deprivation, but the Tory-led Government turned that on its head. Their interpretation is anti the public good.
Grahame M. Morris: I agree that there are various interpretations of what constitutes public sector reform, and I will speak about academies in a few moments. I am grateful to my hon. Friend for her intervention.
On all three points illustrated in that detailed survey, the Government are out of step with the public on public service reform. Ordinary people want public services in public hands for the public good, but the Government seem to want public services outsourced to business for the good of private profit. Ordinary people want universalism, but the Government want to decentralise, to remove targets and to create local variations and postcode lotteries, so going against standardised and universal access. Ordinary people oppose rapid upheaval and fundamental reform to public services, and a case in point is the opposition to the NHS reforms.
The Government have run amok with the reorganisation of the health service and forged ahead with public service reform and outsourcing at breakneck speed. It is no surprise that when Ministers make speeches on public service reform, they do so to business leaders, never to public sector workers, service users or trade union groups who work in the public sector. I want to place on the record my support, sympathy and admiration for the front-line workers who are so often treated like pawns in a game of chess, facing constant change, reorganisation and regrading, often at the whim of political elites.
25 Apr 2012 : Column 323WH
Workers across the public sector know that the latest policy move to the mass outsourcing of services and a free-for-all for business will be a last hurrah, because many of the changes will be irreversible. For people who work in the public service, it means an end to job security and to nationally determined pay, conditions and terms of service. Instead, national public services will become ever more fragmented, unstable and variable, offering short-term and risky employment not by the state, but by any fly-by-night private sector operator.
Jackie Doyle-Price (Thurrock) (Con): The hon. Gentleman is making a passionate case, but it is framed as public versus private. The reality is that we are looking at any number of models to deliver our public services. We have social enterprises and co-operatives. Surely, we should look at the outcome and not the structure of delivery.
Grahame M. Morris: I thank the hon. Lady for her intervention, but there is a danger of fragmentation, even with some of the models that she mentions—for example, in the national health service and social care. If we are trying to promote integrated services, a plethora of private sector and even voluntary sector providers works against that ethos. That is a risk.
My argument is that public sector workers and service users know the difference between private profiteering and public services. Let us not forget that the key difference is that the first duty of a business is to its shareholders and the pursuit of profit.
The coalition Government are trying to do two things in developing their own brand of public service reform, which is quite distinct from what the Labour party did when in office. First, they are trying to tie down companies with more stringent contracts in the belief that setting targets will guarantee performance—ironically, the Government argued against targets in the national health service and wanted them to be ditched by public sector providers. Secondly, they believe that with stricter conditions for private sector providers, there should be no limits on where those providers should be allowed to tread within the public sector.
Ian Mearns (Gateshead) (Lab): My hon. Friend is developing a pertinent point. If we outsource public services—a public commodity—to the private sector, in some way, shape or form the private sector has to make a profit to give to its shareholders. That seems to be the logic from the Government’s perspective, but it will be impossible for public services to become more efficient or reinvest savings back into the development of the service.
Grahame M. Morris: That is an excellent point, and we should be guided by the evidence. If the Minister can demonstrate that that is not the case, I will be interested to hear his response. Certainly, in relation to the national health service, the detailed impact assessment published with the Health and Social Care Bill proved that in-house services were considerably cheaper than those offered by the private sector, as well as being more responsive, accountable and fitting in with the wish for better integration.
25 Apr 2012 : Column 324WH
A little earlier, different models of provision were mentioned. The coalition Government are promoting different models for outsourcing different services within different Departments—for example, academies and education, the utilities model and the NHS, or payment by result for welfare and benefits. However, although those are different models, the driver is the same. Emergency 999 call centres have been privatised and outsourced together with the administration of the benefit system. The roads on which we drive are the latest to go, as the pace of outsourcing to the private sector speeds up.
John Cryer (Leyton and Wanstead) (Lab): Another example is the translation service. Since it was moved into the private sector, a plethora of problems have included translators failing to turn up at court and criminals walking away without being tried because no translator was present.
Grahame M. Morris: There are many examples where the proposals for privatisation, outsourcing or whatever models are being piloted have not produced positive results. I do not have the opportunity to list them all owing to a shortage of time, but I am grateful to my hon. Friend for that example.
The Welfare Bill passed through Parliament in March and lays the foundations for billion-pound contracts of five years or more for private companies to run welfare-to-work programmes and the administration of the new benefits system. I believe that the rush to outsource the biggest spending Department—the Department for Work and Pensions—rather than develop a coherent strategy to create jobs and growth in the economy, is a dereliction of duty by the Government.
Jackie Doyle-Price: The hon. Gentleman draws attention to a good example of a contract that is working. In that contract, the burden of risk is pushed on to the private provider. If it does not deliver jobs, it does not get money. Surely, that is a good thing.
Grahame M. Morris: I am afraid that I do not agree with the hon. Lady. The issue was raised during questions to the DWP on Monday—by myself, I think—and the papers this weekend illustrated a number of examples of service failure. Service users feel huge dissatisfaction with Atos and A4e, and there has been a huge uproar about the quality of service provision in training or retraining ex-offenders.
The evidence base is littered with failures from the private sector, so it is difficult to hold up an example. If there is a good example, I suspect that it might be the exception rather than the rule. Most often, there is a negative impact for employees, with the prevalence of short-term contracts and the use of part-time and temporary staff who are often recruited through employment agencies. Indeed, Unison commissioned a report on the rise of the multi-billion-pound private public services industry and raised significant concerns about the increased dependency on private firms.
The privatisation of public services has already become a huge industry, through which the private sector receives more than £80 billion of taxpayers’ money every year, yet it has become characterised by increased cost, deteriorating quality, the loss of accountability and the greater risk of service failure. The reason why we had
25 Apr 2012 : Column 325WH
the birth of municipal provision in the great northern cities—Manchester, Bradford, Leeds and Wigan—was that the city fathers saw that public provision was more efficient and accountable than the existing private sector provision that was available at the time. Those arguments are not new in that respect.
I want to give another couple of examples. I mentioned A4e, and it would be remiss not to mention the Southern Cross care homes debacle. Other scandals in relation to welfare have also raised such issues and brought this agenda to the fore. That will happen more often as more services are passed over to the private sector. There is also a risk that we will lose control over our public services altogether. Indeed, in 2007, the Local Government Association warned that the amount of local authority spending on external private sector contracts and the ability of local government to make efficiency savings when it has already signed contracts without further damaging services was not realistic.
The Government’s central argument in favour of the increased commercialisation and privatisation of public services rests on the importance of consumer choice as a driver for increased efficiency, accountability and value for money. However, again, that is not supported by the evidence contained in the public surveys that have been carried out. One area that features genuine consumer choice is the provision of utilities. In most parts of the United Kingdom, people can choose a provider of gas or electricity from a handful of companies. However, is that a good example? There is massive public concern that prices have increased way above inflation and that the profits of the energy companies have soared. So the panacea of private-led competition is not everything that the coalition would have us believe it is.
Jonathan Lord: The hon. Gentleman is making a delightful speech in favour of socialism, the big state and the state always providing, whether nationally or locally. He talks about the utilities and so on. British Telecom is not perfect, but I remember as a young man when one had to wait weeks and weeks, if not months, to have a phone installed, and I think there was a choice of about three phones. As soon as BT was privatised, it saved taxpayers’ money and gave a much better service to its customers.
Mrs Anne Main (in the Chair): I remind the hon. Gentleman that I am sure that he would like to give the Minister enough time to respond to the questions that he has asked.
Grahame M. Morris: I would, indeed—thank you, Mrs Main.
There is an awful lot to explore in relation to the subject, but I want to pose a number of questions to the Minister. I want to ask about the evidence. Given that the survey evidence shows that the public seem to reject the individualist consumer approach to public service, why are the Government pursuing that? Can he point to specific pilots or evidence of its success? What protections are in place to stop the spiralling costs of redundancies during this transition period, for example, in the national health service?
In respect of the decentralisation agenda, what specific standards are being developed to ensure accountability, equality of access and provision nationally? With this new landscape of competing service providers from
25 Apr 2012 : Column 326WH
different agencies, with different forms of accountability, how will the needs and interests of service users with complex and multiple needs be protected? I am thinking about the social care sector, where needs dealt with by different providers often require integrated services.
Will the new accountability measures apply to private and voluntary sector providers? As we know, they remain outside of the scope of the Freedom of Information Act. What direct accountability will there be to elected representatives and democratic institutions, nationally and in respect of local government, when such public services are outsourced?
4.50 pm
The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd): It is a great pleasure to serve under your chairmanship for the first time, Mrs Main. I congratulate the hon. Member for Easington (Grahame M. Morris) on securing the debate and on how he presented his case. I believe that he worked in the NHS before going into politics. I read his profile, which says that his political mission is to push Labour leftwards, so he must be delighted with the direction of travel. It is clear where he is coming from and I have a certain respect for that, even though I come from a different place politically.
Our constituencies may be different, but I suspect that all our constituents share a desire to see the Government deliver better value for the tax that they pay. This Government take that seriously.
Ian Lavery (Wansbeck) (Lab): Will the Minister give way?
Mr Hurd: Perhaps I can just advance my argument a little.
This is not the place to have a great debate about the economic situation or the level of debt that the Government have inherited, but we are serious about trying to deliver better value for taxpayers’ money. I am a Minister in the Cabinet Office. The controls that we have put in place—that my boss, the Minister for the Cabinet Office and Paymaster General has put in place—delivered some £3.75 billion in the first year of our Government and are on track to deliver £5 billion of savings this year. We are quite proud of that. Frankly, it was an exercise in delivering common sense. It is an appalling indictment of the attitude of the previous Administration to public money that such big savings could be found in such short order by doing some basic commonsensical things.
Ian Lavery: Does the Minister agree, in respect of looking for better value, that paying doctors, nurses and porters in his constituency more than those in my constituency is a good way of saving money?
Mr Hurd: I want doctors and nurses to be paid at fair value. I am also interested in the value that they offer to the taxpayer for the work that they do, which brings me on to my next point about public services and how they are commissioned.
The Government’s view is that, when expectations about public service standards are rising, we need to find more creative solutions. There is dissatisfaction and a challenge, because there is less money about and therefore greater pressure to get better outcomes with less money.
25 Apr 2012 : Column 327WH
My hon. Friend the Member for Thurrock (Jackie Doyle-Price) made an important point: the direction of travel here is not driven by ideology, although there is more ideology communicated from the Opposition than the Government. This is driven by a desire to deliver better outcomes on behalf of the taxpayer and the people we are trying to help in a way that is much more transparent than before.
Ian Mearns: The Minister belabours the point about making additional efficiencies within government since the coalition came to power. Of course, one of the biggest elements of public expenditure is local government. Conservative control in local government has been at a high watermark for eight or nine years now. Would he criticise Conservative councils in that respect?
Mr Hurd: I resist any invitation to criticise Conservative councils, particularly at this moment. My point is about attitudes to taxpayers’ money. The previous Administration were cavalier with taxpayers’ money and this Administration are trying to deliver better
Gloria De Piero: The Minister might not want to speak about Conservative councils, but I live in Nottinghamshire where the Conservative council has just used taxpayers’ money to develop a new logo on all the buildings. Is that good value for taxpayers?
Mr Hurd: I do not know because I do not know the situation in Nottingham. That is an issue on which the people of Nottingham can take a view and they will be able to express that view more clearly and more loudly because we are moving towards a world in which there is more transparency about local authorities’ spending. We are moving away from the opaque world in which we had very little information about what was being done in our name.
Lisa Nandy (Wigan) (Lab): I share the Minister’s concern about value for money, although I am also concerned about protecting the most vulnerable and about the standard of public services and the intelligence of targets that are used in outsourcing. Will he respond to the point that was powerfully put by my hon. Friend the Member for Easington, about the evidence base behind this? Where is the evidence that outsourcing provides better value for money?
Mr Hurd: I am delighted to move on to the substance of the debate. I have tried my best to respond to various interventions from Opposition Members. The hon. Member for Easington referred to open public services. [Interruption.] With respect to the hon. Gentleman, I am trying to answer the meat of his argument, which is whether it is good to create a situation in which those buying on behalf of the taxpayer have choice about where they buy services on our behalf. He is actually arguing for no choice and for protection of the status quo. The Government’s open public services White Paper makes it clear—we expect a political argument about this—that we want to switch the default setting away from in-house delivery to commissioning services from a diverse range of providers where that would improve services or reduce costs.
The hon. Gentleman made it clear that he was hostile to the for-profits sector. My hon. Friend the Member
25 Apr 2012 : Column 328WH
for Thurrock made a valuable point that the Government are agnostic about who delivers the service. We are particularly keen—it is a coalition Government commitment —to make it easier for charities and social enterprises to participate in public services. They are not driven by a profit motive. By definition, they are driven by a desire to deliver a better outcome for the people whom they support and care about.
Jackie Doyle-Price: The hon. Member for Easington (Grahame M. Morris) referred to academies in his speech. Perhaps I should remind my hon. Friend about the Public Accounts Committee’s inquiry into academies, which showed that they delivered not only better outcomes for the taxpayer but better value for money. Is that not a perfect example of how changing provision and getting away from uniform provision delivers better outcomes?
Mr Hurd: Yes, I absolutely agree. I also agree with what my hon. Friend said when the hon. Member for Easington kept saying, “Where’s the evidence?” There is plenty of evidence for the value of competition—if we need it, because we know it in our daily lives. Academic research suggests that competitively tendering public services typically produces savings of between 10% and 30% while maintaining or improving standards. I refer the hon. Member for Easington to the “Public Services Industry Review” of July 2008 by Dr DeAnne Julius, but there is no shortage of evidence for the value of tendering and introducing competition into the system.
Dr Julius also talked about the payment-by-results regime, which the Opposition do not like at all, although the situation we inherited was that those buying on our behalf were extraordinarily complacent about whether we got anything for the money. Such a regime is not appropriate in every case, but we are moving towards a requirement for commissioners—those buying on our behalf—to think much harder about what they are buying and the outcomes against which they will be measured in a new transparent world where there will be nowhere to hide. Yes, we will introduce payment by results where that is appropriate, because it introduces some basic, common-sense discipline into how we spend taxpayers’ money. For most of my constituents, that makes plain common sense—after all, it is their money.
Finally, we are also keen to encourage the development of mutuals, employee ownership and organisations in which employees are in charge. One such model in which ownership is shared between employees, Government and private sector partners is the innovative pathfinder mutual joint venture, My Civil Service Pension, which provides pension administration for civil servants. Likewise, I go around the country and meet some of the mutual spin-outs from the NHS, where the hon. Gentleman used to work, and the difference when one walks through the door into those organisations is tangible.
Our programme of reform is focused on the citizen and is already cutting out unnecessary cost to help protect front-line priorities. Outsourcing remains an interesting option and one that will offer the best deal in many situations, but it is not the only one, and we are judging every case on its merits.
5 pm
Sitting adjourned without Question put (Standing Order No. 10(11)).