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Written Ministerial Statements

Wednesday 5 December 2012

Treasury

Customs 2020

The Economic Secretary to the Treasury (Sajid Javid): I wish to inform the House that the Government have opted in to the proposal for a regulation of the European Parliament and of the Council establishing an action programme for customs in the European Union for the period 2014-20 (Customs 2020).

This proposal establishes a customs co-operation programme to support the effective functioning of the internal market and operation of customs procedures within the EU by increasing co-operation between member states. The programme aims to contribute to the Europe 2020 strategy for smart, sustainable and inclusive growth, by strengthening the functioning of the single market and EU customs union.

The UK has benefited from participation in predecessor programmes, in particular through using Customs 2013 activities to reduce administrative burdens for compliant businesses. The programme also funds the maintenance and development of EU communication and information exchange systems. This is an area where spend on research and development can represent good EU added value by providing economies of scale in the development of cross-EU networks.

Finance Bill 2013: Measures with Immediate Effect

The Exchequer Secretary to the Treasury (Mr David Gauke): This Government are committed to delivering a progressive tax system that is affordable, fair and encourages growth.

The Government are today announcing measures that will help build a fair tax system and tackle tax avoidance. The legislation for these measures will have effect from today and will be included in Finance Bill 2013.

The protocol on announcements made outside scheduled fiscal events, published at Budget 2011, sets out the criteria the Government will observe when changing legislation with immediate effect. The Government are acting in accordance with the protocol in announcing the following changes to legislation.

Bank Levy—double taxation relief

The Government will introduce legislation to take effect from 1 January 2013 which will put beyond doubt that foreign bank levies are not an allowable deduction for income tax or corporation tax purposes. The legislation will also ensure that where a company makes a claim on or after today’s date for double taxation relief for a foreign bank levy against the charge to the UK Bank Levy, none of that foreign bank levy will be an allowable deduction for income tax or corporation tax purposes.

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Tax Mismatch Schemes

The Government are introducing legislation to counter tax avoidance schemes that aim to reduce a company’s liability to corporation tax through asymmetric tax treatment of loans or derivatives (tax mismatch schemes), including, although not limited to, schemes involving companies which are members of a partnership.

Due to the repeated use of partnerships and similar collective structures in tax avoidance schemes, the Government will be considering the area of the taxation of partnerships and similar structures as part of their review of high-risk areas of the tax code.

Property total return swaps

Legislation is also being introduced to block schemes that use property return swaps to convert capital losses within a group into income losses, and that use the legislation to generate capital gains which are not in proportion to those actually arising from the swap contract.

Manufactured payments

The Government are introducing legislation to address schemes involving stock lending arrangements. In these schemes a company lends stock, and instead of receiving a manufactured payment which is taxable, for example as a trade receipt, receives value in some other non-taxable form. The draft legislation provides that the lender will be taxable when value representing a manufactured payment is received in any form.

Payments of patent royalties

Legislation is also being introduced to abolish the income tax relief for non-trade payments of patent royalties in order to counter an avoidance scheme which exploits the relief, and to simplify the tax code. There is understood to be little use of the relief by compliant taxpayers, but anyone who thinks they will be adversely affected by this change is invited to contact HM Revenue and Customs (HMRC).

Further details on the measures listed above are contained in the draft legislation, explanatory notes and “Tax Information and Impact Notes” published on both the HM Treasury and HMRC websites.


Fiscalis 2020

The Economic Secretary to the Treasury (Sajid Javid): I wish to inform the House that the Government have opted in to the proposal for a regulation of the European Parliament and of the Council establishing an action programme for tax in the European Union for the period 2014-20 (Fiscalis 2020).

This proposal establishes a tax co-operation programme to improve the functioning of taxation systems within the EU by increasing co-operation between member states. The programme aims to contribute to the Europe 2020 strategy for smart, sustainable and inclusive growth, by strengthening the functioning of the single market. It also has the objective of driving technical progress and innovation in national tax administrations with the aim of developing e-tax administrations and contributing to the establishment of a digital single market.

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The UK has benefited from participation in predecessor programmes, in particular through involvement in multilateral controls which can assist with the detection of tax fraud. The programmes also fund the maintenance and development of EU communication and information exchange systems. This is an area where spend on research and development can represent good EU added value by providing economies of scale in the development of cross-EU networks.

Communities and Local Government

Queen Elizabeth II Conference Centre

The Parliamentary Under-Secretary of State for Communities and Local Government (Brandon Lewis): My hon. Friend the Parliamentary Under-Secretary of State, Department for Communities and Local Government, Baroness Hanham, has made the following written ministerial statement:

Further to the statement made to both Houses on 23 April 2012, a pre-market engagement exercise of the Queen Elizabeth II Conference Centre conference business was undertaken over the summer. This exercise demonstrated that there would be market interest in running the conference business.

Since that exercise was carried out, Parliament has published an initial study into options for the long-term upkeep of the Palace of Westminster. The report highlights a number of options for the restoration and renewal of the palace. These require further study, but may have implications for the future use of the Queen Elizabeth II Conference Centre, should Parliament decide that it needs the centre.

While recognising that Parliament needs to continue to have a full range of options available, the Government have concluded that current arrangements for the management of the centre should be maintained for the present time. This will ensure that bookings can continue to be made and allow the centre to plan future business with greater certainty. Should Parliament indicate that it requires the centre in future, it has been agreed that discussions will take place on time scales which recognise the importance of the centre maintaining a viable business plan, to provide assurance to potential customers.

Defence

Advisory Group on Military Medicine

The Minister of State, Ministry of Defence (Mr Mark Francois): I am today announcing the start of the triennial review of the Advisory Group on Military Medicine (AGoMM). Triennial reviews of non-departmental public bodies (NDPBs) are part of the Government’s commitment to ensuring that NDPBs continue to have regular challenge on their remit and governance arrangements.

AGoMM provides independent, specialist advice to the Ministry of Defence, as required, on the policy for medical issues within medical force protection, and for clinical treatments used on operations.

The AGoMM review is to be conducted in accord with Government guidance for reviewing non-departmental public bodies, and will consider the effectiveness of how the functions of AGoMM are currently delivered, whether

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there is a need for the function and the advisory NDPB to continue, and if so, how the function might best be delivered in future. The review will be led by a member of the Surgeon-General’s senior staff who is not involved with the day-to-day business of the group.

Key stakeholders are being informed of the review and invited to submit views. The aim is to complete the review and announce the outcome by 31 March 2013.

Education

School Teachers' Review Body

The Secretary of State for Education (Michael Gove): The “21st Report of the School Teachers’ Review Body” (STRB) is being published today. Its recommendations cover the issues that were referred to it in February 2012. These were about reforming teachers’ pay in order to raise the status of the profession and contribute to improving the standard of teaching in our schools.

I am grateful for the careful consideration which the STRB has given to these important matters and fully support the guiding principles that it has used as the basis for its recommendations. Copies of the STRB’s 21st report are available in the Vote Office, the Printed Paper Office and the Libraries of both Houses, and online at: http://www.education.gov.uk and http://www.ome.uk.com/.

The STRB has made recommendations on a pay framework that seeks to raise the status of the profession, support professional development, and reward individuals in line with their contribution to improving pupil outcomes, enabling the most successful teachers to progress faster than at present on the basis of annual appraisal. It proposes greater autonomy for schools to set teachers’ pay within that broad national framework, alongside increased accountability for high professional standards and contribution to pupil progress.

I am grateful to the STRB for these recommendations and, subject to the views of consultees, I intend to accept all the key recommendations. I also intend to accept the more detailed recommendations and the consequential recommendations, but wish to give notice that there are some areas to which I will wish to return in a future remit for further consideration by the STRB. This will include the application of a 1% pay uplift for the two years following the end of the pay freeze, as set out by the Chancellor in the 2011 autumn statement. The statutory minima and maxima for classroom teachers’ pay will be uprated by 1% in each year 2013-14 and 2014-15. Schools are free to determine the extent of pay uplifts to teachers within the statutory minima and maxima, and will be able to provide an uplift of 1%, in line with any overall uplift in pay in the public sector, if they so choose.

As regards the recommendations on implementation, I broadly accept these in principle, but will want to consider them further before reaching firm conclusions on whether they represent the most effective and practical way of implementing the key recommendations.

My detailed response contains further information on the matters.

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Annex to written ministerial statement

School Teachers’ Review Body’s (STRB’s) recommendations and response from the Secretary of State for Education.

[The following sets out the full set of recommendations from the STRB as published in the 21st report (CM 8487) on 5 December 2012, together with the response from the Secretary of State for Education. The STRB’s recommendations below.]

The Secretary of State for Education (Michael Gove): The 21st report of the STRB is being published today. It covers matters referred to the STRB in February 2012. Copies are available in the Vote Office, the Printed Paper Office and in the Libraries of both Houses and online at: http://www.education.gov.uk and http://www.ome.uk.com/.

In making its recommendations, the STRB was asked to review the current provisions for teachers’ pay and consider;

how the pay framework for teachers should best be made more market facing in local areas;

how the pay scales, including the main and upper pay scales, should be reformed to more effectively link pay and performance, including arrangements for progression;

what other reforms should be made to teachers’ pay and conditions in order to raise the status of the profession and best support the recruitment and retention of high-quality teachers in all schools.

I am grateful for the careful consideration which the STRB has given to these important matters. I am inviting comments on the STRB’s report and my response to its recommendations by 4 January 2013.

The STRB has recommended:

Replacement of increments based on length of service by differentiated progression through the main pay scale to reward excellence and performance improvement.

Extension to all teachers of pay progression linked to annual appraisal (which is already established for more senior teachers). Appraisal should be against a single set of teaching standards, and individual objectives, with a strong emphasis on professional development.

Abolition of mandatory pay points within the pay scales for classroom teachers, to enable individual pay decisions, but with retention at present of points for reference only in the main pay scale, to guide career expectations for entrants to the profession.

Retention of a broad national framework, including the higher pay bands for London and fringe areas and an upper pay scale as a career path for experienced teachers who make a wider contribution to the school.

Replacement of the unnecessarily detailed threshold test for progression from the main to the upper pay scale, with simple criteria based on one set of teacher standards. This will create a consistent progression path from graduate entry to the top of the upper pay scale and allow schools to promote the best teachers more rapidly.

Local flexibility for schools to create posts paying salaries above the upper pay scale, enabling some of the very best teachers to remain in the classroom and lead the improvement of teaching skills.

More discretion for schools in the use of allowances for recruitment and retention and freedom to pay fixed-term responsibility allowances of up to £2,500 a year for time-limited projects.

Reinforcement of the responsibility of head teachers to manage staff and resources and of governing bodies to hold school leaders to account for managing and rewarding the performance of teachers in the interests of pupils.

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On the basis of the above, a much simplified “School Teachers’ Pay and Conditions” document, including a brief guide to the national framework and the flexibilities open to schools.

I am grateful to the STRB for its consideration of the issues and, subject to consultees’ views, I intend to accept all these key recommendations in full. I regard these recommendations as providing the framework to move towards a more flexible and simpler system, where the emphasis is on pay progression related to performance and greater autonomy for schools in deciding how to reward their teachers. I particularly support the aim of enabling the best teachers to be promoted more quickly than is currently the case and rewarded accordingly. I note the STRB’s comments about these recommendations representing a first stage of reform and that they would welcome an opportunity to consider other issues, including leadership pay and teachers’ conditions, in a subsequent remit. I intend to issue a further remit to the STRB next year to ask for their advice about how to implement the 1% pay uplift for the two years following the end of the pay freeze. The statutory minima and maxima for classroom teachers’ pay will be uprated by 1% in each year 2013-14 and 2014-15. Schools are free to determine the extent of pay uplifts to teachers within the statutory minima and maxima, and will be able to provide an uplift of 1%, in line with any overall uplift in pay in the public sector, if they so choose.

The STRB has also further recommended:

The retention, for now, of the four geographical pay bands as the starting point for recognising broad labour market differences which bear widely on recruitment and retention.

Differentiated performance-based progression on the main pay scale to enable teachers to progress at different speeds, with higher rewards and more rapid progression for the most able teachers.

More flexible performance-based progression to and within the upper pay scale, assessed against substantially simplified criteria, enabling abolition of the bureaucratic post threshold standards.

Local discretion to pay a higher salary to the most successful teachers (akin to AST) if such a post is required and meets simple yet demanding criteria on leading improvement of teaching skills.

No change to the core TLR provisions already in the STPCD.

Fixed-term TLRs for time-limited projects, with non-safeguarded payments in a range between £500 and £2,500 per annum.

Removal of the three-year time limit for recruitment and retention, subject to a formal review by the school of all awards on a regular basis.

The Department communicate clearly to schools the scope for them to make greater use of existing discretionary recruitment and retention payments available under paragraph 50 of the STPCD to respond to local market needs, including case-study examples of good practice.

The Department prepare a much simpler document for publication in autumn 2013.

In addition, the STRB has made a number of consequential recommendations:

No obligation for schools when recruiting to match a teacher’s existing salary on either the main or the upper pay scales.

The requirement for two consecutive successful appraisals for progression purposes on the upper pay scale be discontinued.

The existing post-threshold, AST and ET standards be abolished.

The AST pay spine and ET pay range be discontinued.

Again, subject to consultees’ views, I intend to accept all these detailed and consequential recommendations.

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I believe that these represent a significant step in the process of reform and provide the scope for further flexibility at a later stage. For instance, I welcome the recommendations in respect of teaching and learning responsibility payments and recruitment and retention allowances, but would want to ask the STRB to revisit the whole area of allowances in a future remit.

Finally, the STRB has made a number of recommendations about implementation. It has recommended:

The existing points on the main pay scale should become purely reference points.

The Department consider how to give effect to the detailed recommendations on implementation, including:

A clear expectation of progression to the maximum of the main pay scale, subject to good performance;

An option for no progression without the automatic implication of capability proceedings;

Progression to reference point M2 for NQTs on successful completion of the induction period;

All pay progression to be dependent on a written recommendation based on timely completion of an annual performance appraisal in line with the pay policy of a school.

The Department develop guidance or a tool-kit to help schools develop systematic and transparent local approaches to pay progression.

A basic eligibility requirement for teachers applying for the upper pay scale, who must be highly competent classroom teachers who have already progressed substantially towards the maximum of the main scale.

Criteria for access to the upper pay scale requiring candidates to have demonstrated:

Substantial and sustained achievement of objectives, appropriate skills and competence in all elements of the teachers’ standards; and

Potential and commitment to undertake professional duties which make a wider contribution (which involves working with adults) beyond their own classroom.

On the upper pay scale, the amount and timing of any progression recommendations should be at the school’s discretion, reflecting individuals’ differential contributions to the school.

School discretion to create a post for a teacher whose primary purpose is the modelling and leading improvement of teaching skills. Such posts should have a salary range fixed within the range between £37,461 and £56,950 (nationally), taking account of the challenge of the post and of internal pay relativities, with progression increases entirely dependent upon performance.

Discretion for schools to set salaries within the unqualified teachers’ scale without reference points and with performance based progression.

I broadly accept these recommendations in principle. I am however clear that the Department will need to consider further how best to implement the STRB’s key recommendations and that it would be helpful to discuss the details with other parties before reaching firm conclusions that the STRB’s proposals represent the most effective approach. For instance, we may wish to give further consideration to the appropriate criteria for eligibility to the upper pay scale. A requirement to have made substantial progress towards the maximum of the main scale could perhaps seem an unnecessary barrier if we are seeking to enable the best teachers to progress more rapidly. We will also need to ensure that we consider equalities issues as part of the process of implementing the recommendations and I will want to seek consultees’ views on these issues as well.

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Energy and Climate Change

Gas Generation Strategy

The Secretary of State for Energy and Climate Change (Mr Edward Davey): I am laying today before Parliament the Government’s gas generation strategy. Last week I set out in the annual energy statement the objectives of our overarching energy policy—to keep the lights on, to keep energy bills affordable and to cut greenhouse gas emissions. This needs to be delivered in a way that maximises benefits to the economy in terms of jobs, growth and investment. I also published details of our approach for reforming the electricity market which will be implemented through the Energy Bill.

These reforms will deliver investment in a range of new generating plant such as offshore wind, nuclear power stations and carbon, capture and storage equipped generation plant. Gas-fired power stations will also be essential to provide flexibility to complement the less flexible output from wind and nuclear plants. We have already set out our strategies for delivering increases in investment in low carbon technologies—renewables, nuclear and carbon, capture and storage. This strategy sets out the role we see for gas in electricity generation.

The strategy reaffirms the Government’s expectation that gas will continue to play a major role in our electricity mix over the coming decades, alongside low-carbon technologies as we decarbonise our electricity system.

Gas currently forms an integral part of the UK’s generation mix, accounting for nearly 40% of all generation in 2011. As a reliable, flexible form of generation, gas is able to provide a range of services to support the efficient functioning of our electricity network and help guarantee the security of electricity supply that is vital to our homes and our businesses. Gas, which emits half the CO2 of coal, has also helped the UK cut our carbon emissions.

However, the need to decarbonise the UK’s electricity system will significantly impact the role of gas and we need to provide clarity to investors about the future role of gas to enable the new plant we need to get built.

The role gas plays will be determined by the market, while keeping emissions within the limits set by the carbon budgets and consistent with a least-cost approach to the UK’s binding 2050 carbon reduction target. Both now and in the future we need a diverse generation mix that balances risks and uncertainties of different technology options, including uncertainty on future gas prices. However, we are likely to need significant investment in new gas plant.

Modelling by DECC suggests that up to 26 GW of new gas plant could be required by 2030, in part to replace older coal, gas and nuclear plant as it retires from the system. It also indicates that, in 2030, we could need more overall gas capacity than we have today, although operating at lower load factors. The modelling shows that gas could play a more extensive role, with higher load factors, should the fourth carbon budget be revised upwards.

A significant volume of new gas CCGT capacity is in the planning pipeline. There is currently around 15 GW of gas plant with consent and a further 2 GW is under

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consideration. However, only a small amount of that capacity is currently progressing to the construction stage.

Given the importance of gas to our energy mix, the Government issued a call for evidence on 2 May 2012 on the role of gas in the electricity market, to identify whether there are any barriers to bringing forward that investment in gas generation in the UK, and if so, what we can do to remove them. Respondents to that call for evidence identified a number of different barriers to investment.

The objective of the gas generation strategy published today is to reduce the uncertainty around gas generation for investors. Government recognise that support for other forms of generation could undermine certainty for investors in both low-carbon energy sources and gas. To this end, the Government are setting a sustainable and affordable cap on the levy control framework out to 2020. We are also reiterating that our approach to decarbonisation trajectories will continue to stay in step with other EU countries throughout the 2020s and consistent with a least-cost approach to our legally-binding 2050 decarbonisation objective and the fourth carbon budget.

In addition, and in response to the call for evidence, the strategy also provides clarity on electricity market reform including that the Government are legislating for the introduction of a capacity market. We are also introducing backstop powers in the Energy Bill that will enable Government to act in order to improve wholesale liquidity if necessary. In addition, we have brought forward proposals to improve the planning regime in each part of Great Britain by introducing greater flexibility for existing consents and have committed to consider improvements to front-loading requirements and provide more clarity on flexibility available for new applications under the Planning Act.

To ensure the security of our gas supply we support Ofgem’s intention to work with industry to consider the case for interventions to enhance gas supply security through improving the operation of the market, via increased transparency and measures to promote the standardisation of interruptible contracts, and their investigation into the price responsiveness of interconnector flows. The Government will consider whether there is a case for further measures to encourage gas storage, and will publish our findings in spring 2013.

To ensure we make the best use of our natural resources, DECC will establish an Office for Unconventional Gas and Oil that, working with DEFRA and other Government Departments, will join up responsibilities across Government, provide a single point of contact for investors and ensure a simplified and streamlined regulatory process. We will also be consulting on the terms and durations of licences, and on an updated strategic environmental assessment with a view to further onshore licensing.

My right hon. Friend the Chancellor of the Exchequer also announced plans to consult on an appropriate fiscal regime for shale exploration.

The strategy further outlines the Government’s commitment to supporting the development and commercialisation of carbon capture and storage technology, which will potentially enable both gas and coal to have a significant role in the future electricity market as a low-carbon technology.

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Health

NHS Pay Review Body/Senior Salaries Review Body

The Secretary of State for Health (Mr Jeremy Hunt): I am responding on behalf of my right hon. Friend the Prime Minister to the reports of the NHS Pay Review Body (NHS PRB) and the Senior Salaries Review Body (SSRB) on market facing pay for their respective remit groups, which have been laid before Parliament (CM 8501 and Cm 8507). I am grateful to the chairs and members of the review bodies for producing these reports.

The Chancellor of the Exchequer on 7 December 2011 and I on 23 December 2011 asked the NHS PRB to consider how to make pay more market facing in local areas for NHS Agenda for Change (AfC) staff. The remit was for England only.

The NHS PRB found that the AfC pay system already has more extensive market facing features than in many other pay systems in large, national employers, in both the public and private sectors, to respond effectively to local labour markets. Additional freedoms are also available to foundation trusts introduced in legislation by the previous Government.

The NHS PRB found that there was not the firm evidence which would be essential to justify further top-down investment in additional market-facing pay in the NHS at this time. They do not recommend the introduction of centrally designed pay zones this year. Instead, the NHS PRB recommended a fundamental review of high-cost area supplements (HCAS), appropriate use of local recruitment and retention premia and regular review of AfC, including its flexibilities, with any negotiations brought to a conclusion at a reasonable pace. The NHS PRB agreed that should any market-facing approaches emerge from these developments they should be introduced incrementally to take account of affordability.

The Government welcome and accept all of the recommendations of the NHS PRB, including a review of HCAS and will take this work forward in partnership with NHS trade unions and the NHS Employers organisation. The priority is to continue to develop the AfC system and ensure that national terms and conditions are fit for purpose and support the recruitment and retention of good quality staff in the most cost-effective and efficient way.

The Chancellor and I wrote in similar terms to the chair of the SSRB. However, the Department of Health’s evidence noted that from 1 April 2013, the only NHS staff within the remit of the SSRB will be those relatively few very senior managers (VSMs) employed by the Department’s special health authorities and executive non-departmental public bodies, together with a small number in ambulance trusts that have not yet become foundation trusts. All other NHS organisations are free to determine their own pay and terms and conditions for their VSMs.

The SSRB recommended that no additional locality pay measures be added to the new VSMs’ national pay framework as the evidence pointed clearly to the market for VSMs being national rather than local. They observed that the new pay framework already has some flexibility, with safeguards, which should enable the NHS to recruit and retain sufficient numbers of suitable VSMs.

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The SSRB also recommended that all NHS VSMs should be assimilated into and paid according to the new pay framework, on the basis of job weight, once the current NHS reforms have been fully implemented. Our view is that, to avoid increasing pay and costs unnecessarily, the new framework should apply to all new appointments. Existing VSMs should normally remain on their existing terms and conditions unless adjustments are required to comply with equal pay legislation.

The Government welcome and accept the recommendations of the SSRB, apart from the recommendation to assimilate all VSMs on to the new pay framework.

Home Department

Justice and Home Affairs Council

The Secretary of State for the Home Department (Mrs Theresa May): The Justice and Home Affairs (JHA) Council is due to be held on 6 and 7 December in Brussels. My right hon. Friend the Secretary of State for Justice and I will attend on behalf of the United Kingdom. As the provisional agenda stands, the following items will be discussed.

The Council will begin in mixed committee with Norway, Iceland, Liechtenstein and Switzerland (non-EU Schengen states) where there will be an update on the second generation Schengen information system (SIS II). The UK will continue to reiterate its support for the continuation of the current SIS II project. The Commission has committed to deliver the central element of SIS II in early 2013.

The Commission will present its second biannual report on the functioning of Schengen co-operation and the application of the Schengen acquis. The report will form the basis for a political and strategic discussion.

There will be a report by the presidency on obstacles to effective information exchange, with a particular focus on the use of the Swedish initiative (on police information) and on Prüm (on DNA, vehicle registration and fingerprint data). More widely the Commission is undertaking a piece of work on information exchange and intends to publish a communication on the European information exchange model (EIXM). The UK believes that this piece of work should be incorporated into the EIXM to give an overall picture of the tools that are available to member states on information sharing.

Under AOB the Irish delegation will provide the Council with a presentation on its presidency programme, which is due to start on 1 January.

Over lunch there will be a discussion on EU visa policy based on the recent package of Commission documents on visas and growth, local Schengen co-operation, on reciprocity with third countries and the proposal on the common visa list regulation.

The main Council will start with a “state of play” discussion on the common European asylum system (CEAS), on which the presidency is keen to make as much progress as possible by the end of the year. The UK has opted in to the Dublin (III) and Eurodac (II) proposals. Negotiations on these dossiers are progressing well and both are now close to agreement. The UK participates in these measures but has not opted in to the three other directives which make up the CEAS.

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The Council will discuss the annual report on the implementation of the EU counter-terrorism (CT) strategy. Member states have been asked to reflect on EU achievements on counter-terrorism over the last six months and consider where efforts should be prioritised over the next six months. This discussion provides a useful opportunity for the UK to set out its priorities and help shape the EU CT agenda. There will also be a presentation of Council conclusions on aviation security. This proposal to extend the threat-risk assessment methodology, developed to underpin the EU in-bound cargo regime, to other areas of EU-led aviation security is welcome. The UK was influential in establishing the EU in-bound cargo regime, which has raised the security bar for all air cargo entering the EU, and supports its wider application.

There will be a joint Justice and Home Affairs session on Thursday afternoon which will start with a mid-term review of the Stockholm programme. The presidency will present its own assessment of progress under the Stockholm programme, the EU’s five-year Justice and Home Affairs work programme, which was agreed in 2009. The presidency’s paper will be used as a basis for discussion, providing an opportunity to take stock of JHA work completed in the last three years and discuss priorities for work to be taken forward until the end of the programme in 2014. While the Government do not agree with the programme in its entirety, the UK supports stronger action against abuse of free movement rights, closer practical co-operation on migration and asylum, and attaches importance to agreeing the passenger name records directive.

This will be followed by items on the data protection framework. There will be an orientation debate on the regulation and a state of play update provided on the directive. The UK is participating in both these measures having decided not to exercise the opt out under the Schengen protocol in relation to the proposed directive.

The justice day will begin with the presidency aiming to agree a general approach on the proposal for a directive on the confiscation of criminal assets. The confiscation directive will create minimum standards for laws on the freezing and confiscation of instrumentalities and the proceeds of crime. The UK is still seeking changes to the text, particularly with regard to the non-conviction-based confiscation measure, which creates risks for our domestic civil recovery regime. The UK has not opted in to this directive.

Dependent on the status of related files progressing through the Economic and Financial Affairs Council the presidency will seek to gain a general approach on criminal sanctions for insider dealing and market manipulation. The proposal aims to establish minimum EU rules concerning the definition of criminal offences for market abuse. The UK has not opted in to this directive.

The presidency will be providing a state of play update on the proposed directive on the protection of the financial interests of the EU by criminal law (“the PFI directive”). The draft directive would repeal and replace the existing EU convention and protocols on protection of financial interests (PFI). The Commission presented the proposed directive at the October Council.

There will be an orientation debate on the proposals on matrimonial property regimes and the property consequences of registered partnerships. The proposals

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lay down the rules by which it is decided which courts have jurisdiction to resolve disputes on such matters, the law that should be applied and the mechanism by which decisions from one country are recognised and enforced in another. The UK has not opted in to these proposed regulations, and has no plans to opt in post-adoption.

The presidency will also seek to gain a general approach on the proposed regulation on mutual recognition of protection measures in civil matters, which was discussed at the October Council. The instrument aims to establish an effective recognition and enforcement process of protective/preventative orders among member states and complements the directive on the European protection order in criminal matters. The UK supports the overall policy aim of the proposal and has opted in to it. The proposal has yet to clear scrutiny in either House.

There will then be an orientation debate on the proposed regulation for the European account preservation order. This proposal aims to establish a self-standing European procedure to freeze the bank accounts of debtors in cross-border civil cases with cross-border implications to prevent assets being taken beyond the reach of the courts. The UK did not opt in to this proposal, but is playing a full part in the negotiations with a view to a possible post-adoption opt in.

Under non-legislative activities, the EU drugs strategy (2013-20) will be discussed. The strategy aims to reduce significantly the demand for and supply of drugs, to promote international co-operation, research, information and evaluation.

The presidency will also provide a state of play update on the accession of the European Union to the European convention on human rights. The accession by the EU will mean that the EU and its institutions are directly bound by the convention. The Government are keen to ensure that the accession agreement is workable and meets the needs of the EU and its member states as well as the needs of Members of the Council of Europe. The UK welcomes the presidency’s conclusion that binding internal rules on how accession will work in practice must be agreed before the accession agreement can be finalised.

There will then be a discussion on e-justice and the work achieved during the second semester of 2012. The aim of European e-justice is to provide a mechanism to make it easier for national authorities, citizens and businesses to access justice information and services from different member states using electronic means.

The Irish delegation will then provide the Council with a presentation on their programme for the presidency, which is due to start in January.

Over lunch, there will be a ministerial discussion on “Three years after the Lisbon

treaty in the criminal justice area”.

Justice

Prison Service Pay Review Body

The Parliamentary Under-Secretary of State for Justice (Jeremy Wright): The Prison Service Pay Review Body (PSPRB) report on local pay 2012 (Cm 8488) has been

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laid before Parliament today. The PSPRB makes recommendations on remuneration for governing governors and other operational managers, prison officers and unified support grades within its remit in the England and Wales Prison Service.

This report is in response to the Chancellor of the Exchequer’s request for the PSPRB to consider how to make pay more market-facing in local areas for staff within its remit group. Copies of the report have been placed in the Vote Office, the Printed Paper Office and the Libraries of both Houses. I am grateful to the chair and members of the PSPRB for their hard work in producing this report.

The PSPRB recommendation on local market-facing pay is as follows:

The reforms as set out in “Fair and Sustainable” should be implemented in full before consideration of any additional local pay flexibilities.

The Government have accepted the review body’s recommendation, which is consistent with Government proposals, that the new pay arrangements in “Fair and Sustainable” should be given time to “bed in” before consideration of any further local pay flexibilities.

Work and Pensions

Employment, Social Policy, Health and Consumer Affairs Council (EPSCO)

The Minister of State, Department for Work and Pensions (Mr Mark Hoban): The Employment, Social Policy, Health and Consumer Affairs Council will be held on 6 December 2012 in Brussels.

There will be discussion on the posting of workers enforcement directive and Europe 2020. On the discussion on the posting of workers enforcement directive, the UK will clarify that any new enforcement measures must be proportionate and not impact on the single market. On Europe 2020 discussion, the UK supports the priority given in the annual growth survey to encourage growth and tackle unemployment. The Council will also be updated on the proposal for a Council directive on implementing the principle of equal treatment between persons irrespective of religion or belief, disability, age or sexual orientation and proposal for a regulation of the European Parliament and of the Council on the European globalisation adjustment fund (2014-20).

The presidency will report on the state of play on the proposal for a regulation of the European Parliament and of the Council on the European Union programme for social change and innovation.

Ministers will consider Council conclusions on combating violence against women and the provision of support services for victims of domestic violence. They will also adopt a Council declaration on European year 2012 on active ageing and solidarity between generations.

Under any other business, the presidency will provide updates on supplementary pension rights and the EU fund for the most deprived. The presidency will provide information on conferences held during the Cyprus presidency. Finally, the Irish delegation will outline the work programme of their forthcoming presidency.