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Like all other uniformed services, defence firefighters and police have to be ready to go instantly from a state of rest to 100% alertness and very high physical exertion. That puts a heavy strain on the body and, as someone nearing 60 myself, I know we all have to accept that age takes its toll on us. What makes the uniformed services different is the need to go to a 100% level of alertness and effort. Many other manual jobs involve hard work, but it is done at a steady state for several hours, whereas the uniformed services have to go to their 100% physical and mental peak at once, and I think that that top level of fitness decays once we are over 60. A report produced for the Ministry of Defence by Dr P. Griffin, a civilian consultant adviser in occupational medicine, makes it clear that a person’s ability to function with peak physical and mental alertness declines once they are over 60. That has to be taken into account.
Defence police and firefighters have to undertake regular fitness checks and demonstrate a high degree of fitness. I am concerned that if they have to work beyond 60, many of them will fail these tests before they reach retirement age. Having a high proportion of personnel retire early on health grounds is no way to manage vital services such as policing and firefighting. That is why I believe that the cost of reducing the retirement age to 60 will not necessarily be as large as the figure the Minister has been given by his civil servants. I suspect that a large number of personnel will retire on health grounds before they are 65. Although reducing the retirement age will cost the Government money, I do not think that the cost is as great as it may appear.
The anomaly of defence police and firefighters retiring at state pension age while other police and fire personnel retire at 60 has arisen because defence police and firefighters have been classed as civil servants. The correct comparison is with local authority firefighters and other police services.
The Government inherited a plethora of public service schemes with different rules and regulations, and have done a very good job of rationalising them. However, if Lords amendments 78 and 79 are not accepted, it will leave the defence police and fire services in the anomalous position of being the only uniformed services that have to work beyond 60.
Hywel Williams (Arfon) (PC): The hon. Gentleman is making fine points about the physicality of the job. The Minister said that the terms and conditions of the pensions of MOD firefighters and police are immaterial to their ability to carry out the job. Does the hon. Gentleman agree with me and disagree with the Minister?
Mr Reid: I agree that the pension rules are immaterial to their ability to carry out the job. That is the point that I am trying to make. The work of the uniformed services is unique because it involves short bursts of high physical effort and mental alertness. That is what makes these jobs different and why I do not believe it makes sense for them to have to carry on beyond 60.
There should be a simple rule for retirement age. The uniformed services should retire at 60 and other people should retire at the state pension age. If the Lords amendments were accepted, that principle would be implemented. Defence police and firefighters, like other uniformed services, are highly trained and their job puts them in dangerous situations and requires a high degree of fitness.
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I hope that the Government will reflect and agree—if not today, then at some point in the future—that people in these occupations can retire at 60.
Mr Anderson: Ever since this Government took office there has been an attack on public sector pensions. Throughout the debates on public sector pensions, they have ignored the advice of the members of the schemes, the trade unions and the organisations that represent the members. They have torn up long-held agreements, reduced payouts, increased the length of time that people have to pay in and increased the level of contributions.
Many of the Government’s arguments have been based on the work of John Hutton. They have said to Labour Members: “Not us, guv! Your man gave us the template and we’re following his work.” Why on earth are they ignoring John Hutton now? Is it because they have an in-built anti-public sector dogma? Do they want to pull down public sector workers whenever they have the chance to get away with it? Is it because—I think this is the main reason, because the Treasury’s fingerprints are all over this—they are driven by the dogma of a failed Chancellor, who wants to save money in any way that he can because his plan A has failed miserably and the economy of this country has not just stagnated, but has stalled and gone backwards?
John Hutton has said clearly that he made a mistake. My hon. Friend the Member for Nottingham East (Chris Leslie) quoted him. He said that he had missed this point, that he had made an error, and that if he had known about it, he would have addressed it at the time. At the end of his speech, John Hutton said:
“It is incumbent on us to address that issue and not to use the technical arguments as an excuse for not addressing this fundamental discrepancy.”—[Official Report, House of Lords, 12 February 2013; Vol. 743, c. 570.]
A discrepancy is what this is. It is not a huge issue of principle. It is something that was missed by the people who were advising John Hutton, including the trade unions. It was also missed six or seven years ago when we changed the rules. Back Benchers like me should have raised it with our Government. Opposition Members at that time, including Liberal Democrat Members, should have raised it. However, we did not raise it, the trade unions did not raise it and the civil servants who were giving the advice at the time did not raise it, and it went through.
It could be put right now. As John Hutton said, it is a fundamental error. If it is not put right now, is it just because the Government are being contradictory, given that they have argued at every other time that we should follow John Hutton’s template, or because they are being cynically hypocritical? We could put it right, and we could do it now.
It is nonsense to say that the workers in question are somehow civil servants first and police officers or firefighters second. When they run into a building, they do not think, “I’m a civil servant”, they think, “I’m the man who’s going in to sort out a terrorist or to try to rescue somebody from a fire.” I said before that there is no difference between them and a police officer or firefighter working for a local authority, but at times there is, because sometimes they run into buildings where there are things like nuclear weapons, explosives or somebody waiting for them with a shotgun, a machine gun, a hand
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grenade or other explosive device. The physical and mental intensity and the pressure on them is huge, and that should be represented in the Bill.
The argument that people in different pension schemes cannot be on different terms and conditions is nonsense. For years in the national health service, we allowed mental health nurses to retire at 55, or if they chose to carry on working, their pension was guaranteed at that age, because of the nature of their work. It was about the intensity of going to work every day and grappling with some of the most disturbed people in society. That was the right thing to do then, and it is the right thing to do today.
We all saw what happened 30 years ago, when Margaret Thatcher’s Government reduced the retirement age for coal miners first to 62 and then to 60. They did so for the right reason—they realised that people in that industry were a special case and deserved to be seen in that way. At the time of the reduction, in 1980, the life expectancy of a miner was 65 years and two days, so they got their pension for two days. Because of the change in the law, they got the chance to get their pension for up to five years longer, and that was the right thing to do. It is clear to me that the change in the Bill is nothing other than an attempt to escape from the need to pay people what they are entitled to.
Mr Frank Roy (Motherwell and Wishaw) (Lab): Is there not a danger of there being a poorer level of service if emergency workers are older?
Mr Anderson: I agree entirely, as somebody who is facing his 60th birthday—it comes up like an express train. I was a care worker, and I would hate to think that I would still be caring for people at my age, and in the physical shape that I am in at the moment. I would guess that the people I would be caring for might share that view.
The Minister says that there will be negotiations and discussions, but if there is to be a serious discussion, a job evaluation scheme needs to be put in place to see who a worker should be compared with. So far, the people in question are being compared with other civil servants. Should somebody carrying backpacks and armour be compared with somebody working in an office? Of course not. They should be compared with people who are out there doing a similar job for a different organisation. That would lead to exactly the conclusion that John Hutton has now come to. That is why we should support the Lords amendments and the Minister should have the good grace to accept them. They would get him off the hook.
Stephen McPartland: The Lords amendments are great, and I would like to be able to accept them, but I have some concerns about them. Members of all parties are concerned about the emotive nature of the Bill’s effects on a small group of people. I would like to put it on record that I am proud of the public sector. Many members of my family work in it, and they show great commitment to the services in which they work on a day-to-day basis. Some of them risk their lives, and others almost risk their lives teaching very small children—I would much rather address the House than a classroom of 30 primary school children.
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The work of Ministry of Defence police and firefighters is incredibly important, and it would be disingenuous of Members to try to identify whether the job of one set of police officers in the Home Office is more dangerous than that of another set in the Ministry of Defence. Some police officers in the Home Office do a great deal of work in difficult circumstances in some of our areas on a Friday and Saturday night, and some have jobs that are predominantly focused around the desk and paperwork. Those jobs are also very important in the attempt to reduce crime and provide police intelligence.
As I said, this is an emotive issue, and the real problem is the knee-jerk reaction that we are seeing on the Floor of the House to the attempt to resolve it. The shadow Minister said honestly that a mistake was made in 2007 that went through by ministerial order. There was no debate in the Chamber on the retirement age of the forces in question being raised from 60 to 65. I understand, as the hon. Member for Blaydon (Mr Anderson) said, that some people of a particular size, weight and age would not be the best at resolving the problems we have in some of our towns and cities.
4.45 pm
For the Ministry of Defence police and fire service—I believe that some MOD fire officers are in the Gallery watching the debate with great interest—my problem is not the cost; £10 million does not sound like much. It is a lot on an individual level, but for a Government with debts of more than £1 trillion—or moving that way—it does not seem a huge amount of money. I am concerned, however, about the emotive and knee-jerk reaction, because as the Minister set out clearly from the Dispatch Box, there are real differences in terms of employment.
If we accept the amendment and allow the retirement age to be changed from 65 to 60 so that people have the same terms and conditions as those in the Home Office police service and the fire service under some local authorities, my concern is that the Ministry of Defence fire and police service could miss out on some opportunities. Hon. Members, and in particular the shadow Minister, have said a number of times that we do not know enough about the specifics of the terms and conditions—the shadow Minister raised a number of points and mentioned things that have come to his attention only over the past few days.
Chris Leslie: The hon. Gentleman is fortunate—as are we all—to have been elected by his constituents to make decisions, and what could be simpler than this? Essentially it is about whether all firefighters and police officers, whoever their technical employer, should be able to retire at 60. The hon. Gentleman is flannelling around trying to find reasons not to do that, but in his heart of hearts he thinks they should retire at 60—does he not?
Stephen McPartland:
I genuinely believe that people should have the opportunity to make that decision and consult the Government and the trade unions. I do not want a broad-brush approach to this matter. It is not that I do not trust the shadow Minister, but he is trying to pull me into a political trap. I am not interested in politics in that sense; I am interested in representing my constituents and I do not want to accept an amendment that could technically make those fire and police officers
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worse off in the future. I would like to know far more about the details behind the amendment and what accepting it would mean.
The Minister mentioned a figure of around 8% that could be a reduction in net pay. If we accept such an amendment, and the mistake made by the previous Government in 2007 is reversed, I think we should negotiate with trade unions and fire and police officers so that we fully understand what its impact will be on their take-home salary at the end of each month, and how it will affect decisions in their careers and moving forward. I want everybody to have a fair opportunity, and as I have said, I am proud of the public sector and the work it does. Although the amendment seems fair, I do not feel that I can support it because of the broad-brush approach that could lead to MOD police officers and fire service personnel having a worse set of circumstances in a year or two, just so that party political points can be scored. Unfortunately, I will not be able to support the amendment, but I urge the Minister to provide us with more detail in his winding-up speech about how he will encourage the MOD to sit down with the unions and ensure that the pension age will not rise above 65, and that any decision on the pension age will be about 65 and downwards.
Dr Eilidh Whiteford (Banff and Buchan) (SNP): I wish to make a few brief points in support of Lords amendments 78 and 79, which seem eminently sensible and seek simply to bring the normal pension age for MOD police and defence fire and rescue personnel in line with arrangements for other fire and police personnel who do broadly similar jobs. As others have pointed out, when the amendments were first debated in the other place, Lord Hutton seems to have acknowledged that the omission of MOD police and firefighters from his original considerations was an oversight. I agree wholeheartedly with his remarks when he said:
“It is incumbent on us to address that issue and not to use the technical arguments as an excuse for not addressing this fundamental discrepancy.”—[Official Report, House of Lords, 12 February 2013; Vol. 743, c. 570.]
I support the Lords amendments because MOD police and firefighting officers need consistent treatment with other police and firefighters.
Lord Hutton’s conclusion in recommendation 14 of his report was by no means arbitrary. In recommending a normal pension age of 60 for uniformed services personnel, the Hutton report drew on a wide evidence base. It recognised that the nature of the job places intense physical demands on officers and requires them to maintain levels of health and fitness that are not necessary in other day-to-day jobs. That acknowledgment has underpinned the design of terms and conditions for police and firefighters for many years, and remains as pertinent and relevant as it ever was, even if the age at which those personnel will be eligible for retirement has shifted.
It is useful to remember that changing demographics and increases in life expectancy have underpinned the process of pension reform. However, although life expectancy has increased significantly in recent decades, the increase in healthy life expectancy has not kept pace. People are living longer, but they are more likely to live with debilitating health conditions or disabilities. I made general observations on that in earlier stages of the Bill,
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but it is particularly relevant to the uniformed services, because it is imperative that officers are physically capable of meeting the demands of the job. Hutton implicitly acknowledged that when he called for the increase in normal pension age for the uniformed services to be kept under regular review.
We must be realistic about the physical limitations of mere mortals. Hard physical work takes its toll on human bodies. It is clear that people who work in heavier, more demanding jobs suffer more physical strain as they get older. Like the hon. Member for Argyll and Bute (Mr Reid), I was struck by the briefing ahead of the debate from the Defence Fire Risk Management Organisation, which set out in some detail not only the physical demands placed on defence fire and rescue personnel, but the risks to officers, which increase with age—they rise exponentially for officers aged 50 and over. We must be realistic about what we ask people to do. We should not do the sums on paper without thinking of the real cost.
We need to be careful when we talk about the monetary cost. The Minister relied on the argument that the measure will cost too much, but we need to be careful if we assume that the higher pension age will save us money. All hon. Members know that staff retiring on health grounds can be an expensive business. It is all the more expensive when the reasons for a person leaving their job are linked to their occupation. That is an extremely expensive way to do things. We need to look at both sides of the balance sheet before we jump to the conclusion that treating MOD police and firefighters differently from other police and firefighters will save us money.
At the end of the day, this comes down to the fact that MOD police and the defence fire and rescue officers are, to all intents and purposes, uniformed service personnel. They need to be fit and strong, and physically and mentally capable of carrying out their duties in an emergency. We need to recognise that and treat them in exactly the same way—as far as possible—as we treat other police and firefighters.
Another important part of the context is that morale in those services has been put under considerable strain in recent times owing to changes to terms and conditions and proposed reductions to services. Like the hon. Member for Colchester (Sir Bob Russell), who intervened earlier, I have MOD police in my constituency—they look after the St Fergus gas terminal. I am therefore very much aware of the great uncertainty that has overshadowed the service because of MOD reviews. I am also aware that a proposed voluntary early release scheme, for which, I believe, 600 officers applied, has been subject to a rethink. I am glad that the MOD has recognised the folly of rushing in with ill-thought-through cuts, but officers who had applied for early release have been left in a kind of limbo. The service needs to ensure that younger officers come up through the ranks, but the uncertainties of the past few years have undermined morale and the good will of officers, who take substantial risks in their day-to-day working lives, and who we expect to be on the front line during any crisis.
That is why I do not have confidence in the solution set out by the Minister. I know that some of his Liberal Democrat colleagues in the coalition have accepted it—if I had not seen officers being mucked about by the MOD’s prevarication over the early release scheme,
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I would have more confidence in the Government’s proposals. However, having witnessed that, and seeing that the issue is still unresolved, I really do not have that confidence. In that context, I would be keen to see the amendments go through as they are, and I urge Liberal Democrats to come through the Lobby and make their voices heard on behalf of their constituents.
Mr Reid: I want to make it clear on the record that I believe the Government when they say that they want to keep the retirement age at 65, instead of increasing it progressively to 68 when the state pension age goes up. The Government have made that offer. My argument was that the retirement age should be 60, because of the decline in their physical ability to perform at peak fitness after that age.
Dr Whiteford: The hon. Gentleman makes a valid point. Like me, he has constituents who have applied for the early release scheme and been mucked about. That is why we should settle the matter today on the Floor of the House, instead of allowing it to be sent off into the long grass where we can prevaricate some more before failing to reach the conclusion that people need to be treated with consistency.
The question of consistency underpins everything. There is recognition that other police and firefighters need a lower normal pension age than those in less physically demanding roles. People who do the same jobs, but for the MOD, need to be recognised in exactly the same way. I urge the Government to observe the spirit of the Hutton report, accept that this was an oversight, and do the right thing by our MOD police and firefighters by accepting the Lords amendments. I hope, even at this very late stage, that the Minister will capitulate.
Sir Bob Russell: It is regrettable that no Defence Minister is here, because we could be putting the cart before the horse. What is crucial is the fitness for the purpose for which our MOD firefighters and police are employed. That should be the first, driving principle, and then we can move on to retirement ages and pensions. Does the country really want its nuclear bases to be defended by people of my age? Is it really safe for someone of my age to put out a fire on a nuclear submarine? The clear answer is no. It is therefore regrettable that the MOD is not represented in this important debate. This debate must be important, because I have missed the welcome home parade of 4th Mechanised Brigade. As a member of the Defence Committee, I always wish to welcome home our troops. I hope the fact that I am here will be read as an indication of how seriously I take this debate.
I draw the attention of the House to what Lord Hutton of Furness said in the other place:
“I do not believe that there is any substantive technical reason why we cannot look again at the role of the MoD firefighters and the MoD police.”
“Surely there has to be a way of doing the right thing for these people.”—[Official Report, House of Lords, 12 February 2013; Vol. 743, c. 570.]
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I came to this debate fully intending to vote in support of the Lords amendments, but their unintended consequences could well lead to our MOD firefighters and police being financially worse off, albeit while retiring at a younger age. I will therefore take the Minister at his word—he is a Minister whom I trust—and give the matter further consideration in the spirit and intention of what Lord Hutton has said.
Gemma Doyle (West Dunbartonshire) (Lab/Co-op): Will the hon. Gentleman explain why he thinks MOD police and firefighters could be worse off if their normal retirement age is set at 60? That has been repeated a number of times, but I do not believe that it has been explained.
Sir Bob Russell: Yes. As I understand it, the retirement age is one anomaly, but the contributions towards pension funds are another anomaly. To ask the House to have its cake and eat it might be asking for too much.
Gemma Doyle: I do not believe that that is actually in the Bill. I do not believe that pension contributions will be affected, if the House votes to allow MOD police officers and firefighters to retire at 60. As we know—the hon. Gentleman and I represent some of these people—they want to be able to retire at 60.
5 pm
Sir Bob Russell: The hon. Lady used the words, “I believe”, and although she may well be right, it is because of the uncertainty that I welcome the promise from the Minister, whom I must take at his word, to give this matter further consideration. It is worth taking that on board.
Gemma Doyle indicated dissent.
Sir Bob Russell: Well, the hon. Lady and I must beg to differ. I do not want her to think that her support for MOD firefighters and police officers is greater than mine. I was arguing in support of the MOD police when the previous Labour Government were cutting their numbers—so I can do without those sorts of comparisons.
I ask the Minister to give a categorical assurance on the concerns raised by hon. Members on both sides of the House. I particularly welcome the comments from the hon. Members for North Antrim (Ian Paisley) and for Blaydon (Mr Anderson) and my right hon. Friend the Member for Bermondsey and Old Southwark (Simon Hughes), who raised questions that have not yet been fully answered. My hon. Friend the Member for Argyll and Bute (Mr Reid) and the hon. Members for Stevenage (Stephen McPartland) and for Banff and Buchan (Dr Whiteford) also raised concerns.
Simon Hughes: I pay tribute to my hon. Friend’s work on this matter. I have had a chance to check the answer to the question from the hon. Member for West Dunbartonshire (Gemma Doyle). If the amendment were accepted, it would immediately transfer the people in question out of the civil service definition. They would get the benefit of an earlier retirement age, but they would also get the disbenefit of other comparative advantages. That is why we need a negotiated conclusion, not one-line changes to the Bill.
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Sir Bob Russell: I am extremely grateful to my right hon. Friend. When I referred to the unintended consequences, I was not expecting a detailed exposé of what one of them would be.
With some reluctance, I am taking the Minister at his word about the unintended consequences, and I urge the House to do the same. I take on board everything that Lord Hutton has said subsequently about his not being aware of the issue. Trusting the Minister, I think that our MOD firefighters and police officers could conceivably end up better off. I repeat my basic point, however, because the MOD needs to move quickly to reassure the nation about our military depots and nuclear installations. I have seen Faslane at first hand, and we do not want a Dad’s Army—people my age—defending our nuclear installations or trying to put out fires in military establishments.
John McDonnell: I welcome the new enthusiasm on both sides of the House for negotiating with trade unions. We have seen 18 months of industrial action followed by the imposition of a pensions settlement on a large number of civil service workers. I therefore welcome this enthusiasm for negotiating the issue out.
The Government’s policy on pensions was twofold: they wanted to bring together a consistent retirement age across the services, while, as part of public service reform, ensuring a process of modernisation, with retirement schemes reflecting the requirements of service delivery. From what we have received today, I think we are reintroducing an element of chaos into the retirement age. Far from ensuring consistency, we seem to be building anomaly upon anomaly. Far from pragmatically reflecting the reality of delivering a service, we are about to undermine another service.
On delivery, we should learn the lessons of 2007. I did not support the increase in the retirement age for firefighters in 2007, just as I have not supported this legislation. The lesson that the Fire Brigades Union taught us was that once we increase the retirement age in such a physically demanding job, apart from having a physical effect on those workers and their lives—and on their families, too—we do not save money, because people take ill-health retirement, as others have said. At the end of the day, this is not part of a modernisation process; it is a step backwards.
The other issue raised was consistency—this argument that there will be consistency across the uniformed services. However, that was never the case anyway, because we argued for the Prison Service and uniformed services in the health service to be included, but they were excluded. The issue of consistency is drawn even more sharply by the exclusion of the group of staff we are discussing in this debate, who are clearly part of a uniformed service. They are being discriminated against purely on the basis of who employs them. Firefighters who are employed by local government via a fire authority are within the scheme at age 60, whereas those employed by these other bodies are not. That is not just policy making on the hoof; to be frank, it is incompetent policy making.
As for the disbenefits, when a general agreement is taken into legislation in this way there is always the facility for the employer and others to adjust contribution rates, albeit as part of a negotiated settlement, but we usually legislate and then iron out the detail of
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the contribution rates, with the matter usually being resolved through an adjustment of the employer’s contribution.
Let me turn finally to the process. The Minister helpfully tried to respond, but there was insufficient detail. If there is to be negotiation on this issue, we need at least a commitment about the time scale. There has to be a limited time scale, over the next three months, in which we can resolve these anomalies and give this group of workers some security, because the current insecurity is causing concern.
Chris Leslie: My hon. Friend is spot on. We need that time frame, but do we not also need a commitment from the Minister today that the age of 60—this is the equality issue—is, at the very least, a possibility that is on the table? So far we have not had that.
John McDonnell: Today we have at least set out the parameters of what the negotiations will be. The age of 60 has to be No. 1 on the agenda, followed by ironing out other anomalies. The second issue is the point I raised in an intervention on the Minister. We have to have a clear definition of the legislative process by which the negotiated settlement will be speedily agreed through the House. Will it be tacked on to other primary legislation or might there be a speedy regulation change that enables us to implement the process?
Simon Hughes: I, too, pay tribute to the hon. Gentleman for the work he has done. I share his view that it would be helpful if the Minister indicated in the winding-up speech that there will be a fixed timetable for concluding the process and that the age change from 65 to 60 would be on the agenda. If he can do that, I think that realistically, given that we are at the beginning of this financial year, that would be acceptable. I have not cleared that with the unions, but we need something that gives some parameters and the Minister would carry us with him if he set them.
John McDonnell: To go back a bit, I would also like some clarity about the legislative process. The time scale for negotiations can be set and the agenda for those negotiations clarified; my anxiety is that if we do not have a commitment on the time scale for legislation, the issue could be kicked into the long grass or even further. That would be seen by the workers as an act of bad faith unless a clear timetable was also given for the legislative process.
Simon Hughes: I have one quick thought—I am trying to be helpful. In every year there is inevitably a Finance Bill. This is a Treasury matter and could therefore be covered in the new Session by the Finance Bill.
John McDonnell: That is all I am asking for: clarity of process and time scale. It would be extremely helpful, as an act of good will and good faith, for the Minister to take back a reference to this matter in the Queen’s Speech. That would indicate to those involved that the Government attach a priority to ironing out what has been accepted as an anomaly. It is one that might affect only a relatively small number, but it does so critically and in a critical service, as others have said.
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Richard Fuller: It is customary to say what a pleasure it is to follow the previous speaker, and in this case it is a great pleasure to have listened to the contribution from the hon. Member for Hayes and Harlington (John McDonnell). He asked precise questions and reinforced some of the points made by my right hon. Friend the Member for Bermondsey and Old Southwark (Simon Hughes) in order to move forward what the Minister had said earlier. Thanks to those two contributions, we are beginning to get to the real meat of the issue of how we can ensure that this group of overlooked public sector workers can find an acceptable and fair outcome to their pension situation after all these years.
Within the overall ambit of the Bill, I speak as one who sits outside the cosy compromise between Government and Opposition Members on the principles set out by Lord Hutton. Our decisions on pensions must stand the test of time. People make decisions about contributions to their pensions based on the expectation that those contributions will have an effect 20 or 30 years later when they retire. My concern about the compromise relates to affordability, given that we are asking the taxpayer to foot the bill.
I want to draw the House’s attention to the specific costs involved in the measure. I am sure that the Minister will correct me if I am wrong, but I believe that the amount involved is £10 million per annum. I am a big admirer of my hon. Friend the Member for Stevenage (Stephen McPartland), but he said earlier that £10 million a year was not really a considerable amount of money. I believe, however, that it is indeed a considerable amount of money to be paid year on year. Under the previous Government, it was that attitude that £10 million here and £10 million there did not really matter that led to the grotesque financial situation that we found ourselves in in 2010.
Stephen McPartland: Will my hon. Friend give way?
Richard Fuller: I will give way to my spendthrift Friend.
Stephen McPartland: The point I was making was that, although £10 million is a lot of money at a personal level, I do not feel that it should be a reason to allow such discrepancies to continue. The House should be trying to create parity between all those who do that difficult job on a daily basis, and to focus on the overall package of measures rather than just on the pensions question. That £10 million could provide savings, as the Minister suggested earlier.
Richard Fuller: My hon. Friend has characteristically drawn us to the centre ground. When we consider our public sector workers, we should look not at their pensions in isolation but at the broader question of the compensation terms and conditions under which they are employed.
As I have said, we are talking about a relatively small number of workers. Those members of our public services have a physically demanding job, but it is also a requirement of their public service employment that they are at times asked to put their lives at risk to maintain public safety. It behoves us to take a special approach to such workers and to the way in which their pension conditions are treated.
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John Hemming (Birmingham, Yardley) (LD): Does my hon. Friend agree that this is about the physical efforts of the uniformed services, and that the £10 million will not derail the whole package? We need to be aware that certain jobs are particularly physically demanding, and that people cannot keep on doing them until they reach the relatively young age of my hon. Friend the Member for Colchester (Sir Bob Russell), for example?
5.15 pm
Richard Fuller: I do not wish to disagree with my hon. Friend, but I may have to do so. Many jobs in both the public and private sector are physically demanding, but I would not advocate a different retirement age purely on the basis of physicality. The Opposition Front-Bench spokesman tried to make a specific point about physicality, but I believe that that is the wrong course to take. I believe that this group of workers—the MOD police force and firefighters—have an additional requirement placed on them by us, the taxpayers, whereby we ask them as part of their responsibilities potentially to put their lives at risk, or at least to put the safety and interests of the public ahead of themselves. If I may say so, that is a far more appropriate basis for our looking at this particular issue. People may wish to make the case for physicality, but there is a special case here that goes above and beyond that. That is, I think, the reason why the Minister has taken such great interest in trying to find a solution on this issue.
I welcomed hearing the Labour party admit that it completely forgot about these people when it was in office and raised the pension age. Hearing that was welcome, because all Governments make mistakes and people do get missed out in the transitions. Let me explain what I would like to hear from the hon. Member for Nottingham East (Chris Leslie) today. There is a chance in future—I do not think it will be in 2015, but it is likely at some time for these public sector workers in the MOD, the fire service or the police force—of there being a Labour Government.
Richard Fuller: I am pleased that the shadow spokesman raises that possibility. Is he therefore prepared to put his money where his mouth is—today? He has made a commitment, but is it just words? If he is so confident of being in office, will he pledge today to ensure that these MOD workers have the same conditions as he advocates? I give way if he wishes to make that pledge.
Chris Leslie: The hon. Gentleman knows, I hope, that we are not making this decision in 2015; we are making it here and now in 2013. We have to confront the issue. He is trying to find all sorts of reasons not to disagree with the Whips who are leaning on him, saying “Please do not vote with your conscience on this particular issue.” We have accepted that the issue should have been addressed in 2007. Now that there is no excuse for lacking awareness of it—it is being debated now—is he really going to vote today, in his full awareness of these facts, to say that this particular group of firefighters should not be entitled to retire at 60 when all the other firefighters are? Is that really what he is going to do?
22 Apr 2013 : Column 673
Richard Fuller: The hon. Member for Nottingham East is a fine fellow, but I have to tell him—[Interruption.] “Fine fellow” will be the beginning and end of my comments to him. [Interruption.] I will come to the point, as this strikes at the credibility of the political class in this country. What the Labour party spokesman is trying to do is to use words to set up people’s expectations without taking the responsibility to fund them. That is why the political class is seen through by the public, who are fed up with politicians making up arguments that exist in the world of fancy but not in the hard reality in which people live. If I may say so to the fine fellow opposite, if he wants to be honest to the British people and, more importantly, to the people whom this amendment is designed to represent, it is his responsibility to pledge today to put taxpayers’ money where his mouth is if he is ever in government. I note that that is a commitment that he has very specifically missed out today.
John Hemming: The Opposition seem to be saying that the decision should be made today without negotiation, but does my hon. Friend agree with me that negotiation is the best way forward, and that to have such negotiation, we need to support the Government’s proposal for negotiation?
Richard Fuller: I am grateful for my hon. Friend’s second intervention, because it enables me to agree with him this time. As I said at the start of my speech, the hon. Member for Hayes and Harlington and the right hon. Member for Bermondsey and Old Southwark made the same point in pressing the Minister for more specificity. I, too, wish to ask him for clarification on that point.
Madam Deputy Speaker (Dawn Primarolo): Order. May I remind the hon. Gentleman that the debate is time-limited? If he wishes to hear the Minister’s clarification, he must leave time for it before the debate ends at 5.37 pm.
Richard Fuller: I shall attempt to make my points speedily, Madam Deputy Speaker.
The hon. Member for Hayes and Harlington made two requests. He asked when the negotiations that may be conducted between the Ministry of Defence and the workers and their representatives would have to be concluded, and suggested a three-month time frame. I support that recommendation. He also asked for an indication from the Minister, today if possible but otherwise in a subsequent letter to Members, of what the legislative process would be for the reaching of a resolution. I think that both those suggestions are very worth while.
Will the Minister confirm that the assessment by MOD and the workers’ representatives will not specify a particular retirement age, and that the decision will be based on an assessment of the potential ability of members of those work forces to do their jobs effectively? Will he also confirm—I think he said this earlier, but confirmation would be helpful—that the scheme will be flexible enough to allow us to make the changes without any limit, but that it will be up to those in the scheme to make the recommendations? I hope that he will be able to make those two commitments today.
22 Apr 2013 : Column 674
It is important for the Government to be able to maintain a dialogue about the retirement age of our firefighters, both in the MOD and outside it. We are embarking on unknown territory, and I think that a Government who listen to these workers will be seen to be truly putting their money and their heart where their mouth and commitments are.
Sajid Javid: I thank all who have spoken during the past hour. I also thank my right hon. Friend the Member for East Yorkshire (Mr Knight), who could not speak in the debate, but who has an interest in the issue and has made representations to me on behalf of his constituents. I hope that I shall be able to respond to the points that have been made in the time that is available to me.
Both my hon. Friend the Member for Argyll and Bute (Mr Reid) and the hon. Member for Banff and Buchan (Dr Whiteford) made a number of points. As they will understand, I could not agree with everything that they said, but they both made the sensible point that the Treasury and the MOD should take account of those who retire early on health grounds when considering the potential cost implications of the changes that we are discussing. I agree that we must bear in mind all the impacts on costs that the amendments might have.
My hon. Friend the Member for Stevenage (Stephen McPartland) also raised a number of issues, including the important issue of the Opposition’s credibility in this regard. Some MOD firefighters and police officers who are listening to the debate will already have a retirement age of 65 rather than 60 because of the changes made by the last Government in 2007. When the hon. Member for Nottingham East (Chris Leslie) speaks about such matters, his own credibility becomes somewhat shallow.
I do not often agree with the hon. Member for Blaydon (Mr Anderson). I again did not agree with much of what he said, but I know he believes passionately in what he says, and I respect fully what he had to say. He is a great advocate for his constituents, but he, too, did not address the issue of the change that was made in 2007, and nor did his party colleague, the hon. Member for Hayes and Harlington (John McDonnell). For the purposes of this debate, it would be useful to know whether the hon. Members who have spoken up today also did so when the retirement age was changed in 2007.
Sajid Javid: I give way first to the hon. Member for Blaydon.
Mr Anderson: If the Minister checks the record tomorrow, he will see that I specifically said I made a mistake, and I also made a point about the Liberal Democrats not raising this issue at that time. The Minister is therefore wrong if he is saying I did not deal with the issue.
Sajid Javid: I shall now give way to the hon. Member for Hayes and Harlington.
John McDonnell: I did not make a mistake: I opposed the lot.
22 Apr 2013 : Column 675
Sajid Javid: That is characteristic of the hon. Gentleman, as he opposes a lot in this Chamber, and perhaps did so even when his party was in government.
My hon. Friend the Member for Colchester (Sir Bob Russell) raised a number of points. I agree with his comments about fitness for the purpose. He asked about whether MOD firefighters and police officers are fit for the purpose and that is key, because it is essential that we set retirement ages that are appropriate for the jobs in question, as I said in my opening speech.
My hon. Friend also touched on the related issue of pension contributions. If we just accept these amendments, there will be consequences from the changes. The hon. Member for West Dunbartonshire (Gemma Doyle), speaking for the Opposition, intervened on my hon. Friend on that matter, but what she said was wrong, because there would be consequences. We would have to think about who would pay for these changes, and if there were a change in the retirement age we clearly could not have a situation where, for instance, the civilian firefighters and the MOD firefighters had the same retirement age but paid different pension contributions. We would have to consider such issues. The hon. Lady knows that such issues exist, and it does not serve this House well to pretend they do not.
Chris Leslie: The Members who have engaged in this debate were asking the Minister to see whether there would be any movement, and one issue raised was the time frame for any potential negotiation on movement. I happen to think we should hold out for 60—that that should be the decision today—but I do want to ask the Minister: is he sure there is the potential for going to 60 for MOD firefighters and civilian firefighters without primary legislation? I am worried that, if we let this matter pass today, we might not be able to deal with it through regulations and secondary legislation, and that we will instead require primary legislation if we are to have the potential to get parity. Can the Minister confirm that we would need primary legislation for that?
Sajid Javid: I was going to come to that issue, because my hon. Friend the Member for Bedford (Richard Fuller) and the hon. Member for Hayes and Harlington, as well as the Opposition spokesperson, raised it. I will say a bit about the MOD process, but first let me repeat an important point: this is a broad-ranging Bill to deal with all public sector pensions, affecting approximately 12 million individuals, by addressing the issue of increasing life expectancy and seeking to find the necessary savings in a fair way from employees, employers and the taxpayer. It is framework legislation: it sets the general framework for individual schemes, but that is all it does. It is for the individual employer organisations and the employees to negotiate the terms of each scheme.
We deliberately set up the legislation to provide significant flexibility, so that if the MOD, and therefore the Government, decide at a later date that the retirement age needs to change, it would not require further legislation. The MOD can make the decision in discussion with stakeholders and others. The legislation will give not just the MOD but all public sector employee organisations flexibility to deal with the particular circumstances of their schemes.
22 Apr 2013 : Column 676
5.30 pm
My hon. Friend the Member for Bedford and the hon. Member for Hayes and Harlington both asked about the time scale. I hope that tomorrow in the other place my noble Friend Lord Newby can give a bit more information about the time scale, because I have heard the desire of this House for that. The most important thing is that the issue is considered in the round, with the terms and conditions that are being negotiated for other schemes in the public domain. I expect the MOD to hold discussions within the same time frame.
The MOD has already fired the starting gun for those discussions, and has written to the members of the forces the legislation might affect. I am glad that process has started.
John McDonnell: When the legislation leaves this House and goes back to the other place, could the Minister write to us explicitly about the generality of the Bill—about its being a framework Bill? It seems curious that a framework Bill lists a number of categories of worker whose retirement age will be at 60. That is why many people felt they needed to be included in that list if they were to be protected. It seems odd that the Minister is now saying, “Don’t worry because it is a general framework Bill.”
Sajid Javid: The Government have been very clear that one of the purposes of the Bill is to deal with increasing life expectancy and longevity. That is why retirement ages are increasing for almost all public sector workers, and there is a link to the state pension age. The Government must address the issue; it was something the previous Government ducked, but it is vital for making the public finances more secure. That situation has not changed. What I am outlining today, with regard to the issue relating to MOD firefighters and police officers, is that there is flexibility within the MOD scheme for it to come up with a different arrangement. The MOD has agreed to look into that. It has not made any decisions, but I am sure that it will look very carefully indeed at the issue.
Chris Leslie: The Minister says that the Bill is flexible. May I direct him to page 23, schedule 1, where there is a definition of fire and rescue workers? It states:
“In this Act, ‘fire and rescue workers’ means persons employed by…a fire and rescue authority in England or Wales…the Scottish Fire and Rescue Service, or…the Northern Ireland Fire and Rescue Service Board.”
Currently, that reference does not include Ministry of Defence firefighters. Can the Minister tell us that it does not require primary legislation to amend schedule 1 in that way?
Sajid Javid: I thought I made myself clear but I will say it again: it would not require primary legislation if the MOD decided it was appropriate and right to make any changes to the retirement age.
Simon Hughes: The Minister is being very helpful. In answer to an earlier question, he alluded to the timetable that has started. Would it be reasonable to assume that the negotiations are intended to be concluded by the MOD during this financial year at the latest?
22 Apr 2013 : Column 677
Sajid Javid: My right hon. Friend asks a good question. I have heard the desire of the House for a timetable and I respect that. I will ask my noble Friend Lord Newby to speak further on that point tomorrow.
The hon. Member for Hayes and Harlington asked me to write to him on a specific issue, and I will. I heard that point.
This has been a passionate debate. The Government have been very clear that we value tremendously the work of MOD firefighters and police officers. We have heard clearly the issues that have been raised today and how passionately they have been argued. I hope that I have managed to persuade some hon. Members—no doubt I have not managed to persuade all of them—that the Government take the issue seriously. The MOD will be looking into the issue and has already set the ball rolling. I hope that that will be a speedy process, and I urge the House to vote against the amendments.
Question put, That this House disagrees with Lords amendment 78.
The House divided:
Ayes 278, Noes 217.
Division No. 221]
[
5.35 pm
AYES
Adams, Nigel
Afriyie, Adam
Aldous, Peter
Alexander, rh Danny
Amess, Mr David
Andrew, Stuart
Arbuthnot, rh Mr James
Bacon, Mr Richard
Baker, Norman
Baker, Steve
Baldry, Sir Tony
Baldwin, Harriett
Barclay, Stephen
Barker, rh Gregory
Barwell, Gavin
Bebb, Guto
Bellingham, Mr Henry
Beresford, Sir Paul
Berry, Jake
Bingham, Andrew
Birtwistle, Gordon
Blackwood, Nicola
Blunt, Mr Crispin
Boles, Nick
Bone, Mr Peter
Brady, Mr Graham
Brake, rh Tom
Bray, Angie
Brazier, Mr Julian
Bridgen, Andrew
Brokenshire, James
Browne, Mr Jeremy
Bruce, Fiona
Bruce, rh Sir Malcolm
Buckland, Mr Robert
Burley, Mr Aidan
Burns, Conor
Burns, rh Mr Simon
Burrowes, Mr David
Burstow, rh Paul
Burt, Lorely
Byles, Dan
Cairns, Alun
Campbell, rh Sir Menzies
Carmichael, rh Mr Alistair
Carswell, Mr Douglas
Cash, Mr William
Chishti, Rehman
Clark, rh Greg
Clegg, rh Mr Nick
Clifton-Brown, Geoffrey
Coffey, Dr Thérèse
Collins, Damian
Colvile, Oliver
Crabb, Stephen
Crouch, Tracey
Davies, Glyn
Davies, Philip
de Bois, Nick
Dinenage, Caroline
Djanogly, Mr Jonathan
Dorrell, rh Mr Stephen
Doyle-Price, Jackie
Duddridge, James
Duncan, rh Mr Alan
Duncan Smith, rh Mr Iain
Ellis, Michael
Ellison, Jane
Ellwood, Mr Tobias
Elphicke, Charlie
Eustice, George
Evans, Graham
Fabricant, Michael
Fallon, rh Michael
Field, Mark
Fox, rh Dr Liam
Francois, rh Mr Mark
Freeman, George
Freer, Mike
Fuller, Richard
Garnier, Sir Edward
Garnier, Mark
Gauke, Mr David
Gibb, Mr Nick
Gilbert, Stephen
Glen, John
Goldsmith, Zac
Goodwill, Mr Robert
Gove, rh Michael
Grant, Mrs Helen
Gray, Mr James
Grieve, rh Mr Dominic
Griffiths, Andrew
Gummer, Ben
Gyimah, Mr Sam
Halfon, Robert
Hames, Duncan
Hammond, rh Mr Philip
Hammond, Stephen
Hancock, Matthew
Hands, Greg
Harper, Mr Mark
Harrington, Richard
Harris, Rebecca
Hart, Simon
Haselhurst, rh Sir Alan
Heath, Mr David
Heaton-Harris, Chris
Hemming, John
Henderson, Gordon
Hendry, Charles
Herbert, rh Nick
Hinds, Damian
Hoban, Mr Mark
Hollingbery, George
Hollobone, Mr Philip
Holloway, Mr Adam
Hopkins, Kris
Horwood, Martin
Howarth, Sir Gerald
Howell, John
Hughes, rh Simon
Hunt, rh Mr Jeremy
Hunter, Mark
Huppert, Dr Julian
Hurd, Mr Nick
Jackson, Mr Stewart
Javid, Sajid
Jenkin, Mr Bernard
Johnson, Gareth
Johnson, Joseph
Jones, Andrew
Jones, Mr Marcus
Kawczynski, Daniel
Kelly, Chris
Kirby, Simon
Knight, rh Mr Greg
Kwarteng, Kwasi
Laing, Mrs Eleanor
Lamb, Norman
Lancaster, Mark
Lansley, rh Mr Andrew
Latham, Pauline
Laws, rh Mr David
Leadsom, Andrea
Lee, Jessica
Lee, Dr Phillip
Leech, Mr John
Lefroy, Jeremy
Leslie, Charlotte
Letwin, rh Mr Oliver
Lewis, Brandon
Lewis, Dr Julian
Lilley, rh Mr Peter
Lloyd, Stephen
Lopresti, Jack
Lord, Jonathan
Loughton, Tim
Luff, Peter
Lumley, Karen
Macleod, Mary
Main, Mrs Anne
Maude, rh Mr Francis
Maynard, Paul
McCartney, Jason
McIntosh, Miss Anne
McPartland, Stephen
McVey, Esther
Menzies, Mark
Metcalfe, Stephen
Miller, rh Maria
Mills, Nigel
Milton, Anne
Mitchell, rh Mr Andrew
Moore, rh Michael
Mordaunt, Penny
Morgan, Nicky
Morris, Anne Marie
Mosley, Stephen
Mowat, David
Mulholland, Greg
Mundell, rh David
Munt, Tessa
Murray, Sheryll
Newmark, Mr Brooks
Newton, Sarah
Nokes, Caroline
Norman, Jesse
Nuttall, Mr David
O'Brien, Mr Stephen
Offord, Dr Matthew
Ollerenshaw, Eric
Opperman, Guy
Ottaway, Richard
Paice, rh Sir James
Patel, Priti
Penning, Mike
Penrose, John
Perry, Claire
Phillips, Stephen
Pickles, rh Mr Eric
Pincher, Christopher
Poulter, Dr Daniel
Prisk, Mr Mark
Pritchard, Mark
Raab, Mr Dominic
Randall, rh Mr John
Reckless, Mark
Redwood, rh Mr John
Rees-Mogg, Jacob
Rifkind, rh Sir Malcolm
Robathan, rh Mr Andrew
Robertson, rh Hugh
Robertson, Mr Laurence
Rosindell, Andrew
Rudd, Amber
Ruffley, Mr David
Russell, Sir Bob
Rutley, David
Sandys, Laura
Scott, Mr Lee
Selous, Andrew
Sharma, Alok
Shelbrooke, Alec
Shepherd, Sir Richard
Skidmore, Chris
Smith, Miss Chloe
Smith, Henry
Smith, Julian
Smith, Sir Robert
Soames, rh Nicholas
Soubry, Anna
Spelman, rh Mrs Caroline
Stanley, rh Sir John
Stewart, Bob
Stewart, Iain
Stewart, Rory
Streeter, Mr Gary
Stride, Mel
Stunell, rh Andrew
Sturdy, Julian
Swales, Ian
Swayne, rh Mr Desmond
Swinson, Jo
Syms, Mr Robert
Tapsell, rh Sir Peter
Teather, Sarah
Thornton, Mike
Timpson, Mr Edward
Tomlinson, Justin
Tredinnick, David
Truss, Elizabeth
Turner, Mr Andrew
Tyrie, Mr Andrew
Uppal, Paul
Vaizey, Mr Edward
Vara, Mr Shailesh
Vickers, Martin
Walker, Mr Charles
Walker, Mr Robin
Ward, Mr David
Weatherley, Mike
Wharton, James
Wheeler, Heather
White, Chris
Whittaker, Craig
Whittingdale, Mr John
Wiggin, Bill
Williams, Mr Mark
Williams, Stephen
Williamson, Gavin
Wilson, Mr Rob
Wollaston, Dr Sarah
Wright, Jeremy
Wright, Simon
Yeo, Mr Tim
Young, rh Sir George
Zahawi, Nadhim
Tellers for the Ayes:
Mr David Evennett
and
Karen Bradley
NOES
Abbott, Ms Diane
Abrahams, Debbie
Ainsworth, rh Mr Bob
Ali, Rushanara
Allen, Mr Graham
Anderson, Mr David
Ashworth, Jonathan
Austin, Ian
Bailey, Mr Adrian
Bain, Mr William
Balls, rh Ed
Banks, Gordon
Barron, rh Mr Kevin
Bayley, Hugh
Beckett, rh Margaret
Begg, Dame Anne
Benn, rh Hilary
Berger, Luciana
Blackman-Woods, Roberta
Blears, rh Hazel
Blomfield, Paul
Blunkett, rh Mr David
Bradshaw, rh Mr Ben
Brennan, Kevin
Brown, Lyn
Brown, rh Mr Nicholas
Brown, Mr Russell
Bryant, Chris
Buck, Ms Karen
Burden, Richard
Burnham, rh Andy
Byrne, rh Mr Liam
Campbell, Mr Alan
Caton, Martin
Champion, Sarah
Chapman, Jenny
Clark, Katy
Clarke, rh Mr Tom
Clwyd, rh Ann
Coaker, Vernon
Coffey, Ann
Cooper, rh Yvette
Crausby, Mr David
Creagh, Mary
Creasy, Stella
Crockart, Mike
Cruddas, Jon
Cryer, John
Cunningham, Alex
Cunningham, Mr Jim
Cunningham, Sir Tony
Curran, Margaret
David, Wayne
Davidson, Mr Ian
De Piero, Gloria
Denham, rh Mr John
Dobson, rh Frank
Docherty, Thomas
Donohoe, Mr Brian H.
Doran, Mr Frank
Dowd, Jim
Doyle, Gemma
Dromey, Jack
Dugher, Michael
Durkan, Mark
Eagle, Ms Angela
Eagle, Maria
Edwards, Jonathan
Efford, Clive
Ellman, Mrs Louise
Esterson, Bill
Evans, Chris
Field, rh Mr Frank
Fitzpatrick, Jim
Flello, Robert
Flint, rh Caroline
Flynn, Paul
Fovargue, Yvonne
Francis, Dr Hywel
Gapes, Mike
Gardiner, Barry
Gilmore, Sheila
Glass, Pat
Godsiff, Mr Roger
Goggins, rh Paul
Goodman, Helen
Greatrex, Tom
Green, Kate
Griffith, Nia
Gwynne, Andrew
Hain, rh Mr Peter
Hamilton, Mr David
Hanson, rh Mr David
Harman, rh Ms Harriet
Harris, Mr Tom
Havard, Mr Dai
Healey, rh John
Hendrick, Mark
Hepburn, Mr Stephen
Hillier, Meg
Hilling, Julie
Hodge, rh Margaret
Hodgson, Mrs Sharon
Hoey, Kate
Hopkins, Kelvin
Hosie, Stewart
Howarth, rh Mr George
Hunt, Tristram
Irranca-Davies, Huw
Jackson, Glenda
Jamieson, Cathy
Jarvis, Dan
Johnson, rh Alan
Johnson, Diana
Jones, Graham
Jones, Susan Elan
Kaufman, rh Sir Gerald
Keeley, Barbara
Kendall, Liz
Khan, rh Sadiq
Lammy, rh Mr David
Lavery, Ian
Leslie, Chris
Llwyd, rh Mr Elfyn
Lucas, Ian
MacNeil, Mr Angus Brendan
Mactaggart, Fiona
Mahmood, Shabana
Malhotra, Seema
Mann, John
Marsden, Mr Gordon
McCabe, Steve
McCann, Mr Michael
McCarthy, Kerry
McClymont, Gregg
McCrea, Dr William
McDonnell, John
McFadden, rh Mr Pat
McGovern, Alison
McGovern, Jim
McGuire, rh Mrs Anne
McKechin, Ann
McKenzie, Mr Iain
McKinnell, Catherine
Meacher, rh Mr Michael
Mearns, Ian
Miliband, rh Edward
Miller, Andrew
Mitchell, Austin
Moon, Mrs Madeleine
Morden, Jessica
Morrice, Graeme
(Livingston)
Morris, Grahame M.
(Easington)
Mudie, Mr George
Munn, Meg
Murphy, rh Mr Jim
Murphy, rh Paul
Murray, Ian
Nandy, Lisa
O'Donnell, Fiona
Onwurah, Chi
Paisley, Ian
Pearce, Teresa
Perkins, Toby
Pound, Stephen
Powell, Lucy
Qureshi, Yasmin
Raynsford, rh Mr Nick
Reed, Mr Jamie
Reed, Mr Steve
Reid, Mr Alan
Reynolds, Emma
Robertson, Angus
Robertson, John
Robinson, Mr Geoffrey
Roy, Mr Frank
Roy, Lindsay
Ruane, Chris
Ruddock, rh Dame Joan
Sarwar, Anas
Sawford, Andy
Seabeck, Alison
Sharma, Mr Virendra
Sheerman, Mr Barry
Shuker, Gavin
Simpson, David
Skinner, Mr Dennis
Slaughter, Mr Andy
Smith, rh Mr Andrew
Smith, Nick
Smith, Owen
Spellar, rh Mr John
Stuart, Ms Gisela
Sutcliffe, Mr Gerry
Tami, Mark
Thomas, Mr Gareth
Thornberry, Emily
Timms, rh Stephen
Trickett, Jon
Twigg, Derek
Twigg, Stephen
Vaz, rh Keith
Walley, Joan
Watts, Mr Dave
Weir, Mr Mike
Whiteford, Dr Eilidh
Whitehead, Dr Alan
Williams, Hywel
Wilson, Phil
Winnick, Mr David
Winterton, rh Ms Rosie
Wishart, Pete
Wood, Mike
Woodcock, John
Woodward, rh Mr Shaun
Wright, David
Wright, Mr Iain
Tellers for the Noes:
Tom Blenkinsop
and
Nic Dakin
Question accordingly agreed to.
22 Apr 2013 : Column 678
22 Apr 2013 : Column 679
22 Apr 2013 : Column 680
Lords amendment 78 disagreed to.
22 Apr 2013 : Column 681
5.50 pm
More than two hours having elapsed since the commencement of proceedings on consideration of Lords amendments, the proceedings were interrupted (Programme Order, this day).
The Deputy Speaker put forthwith the Questions necessary for the disposal of the business to be concluded at that time (Standing Order No. 83F).
Motion made, and Question put, That this House disagrees with Lords amendment 79.—(Sajid Javid.)
The House divided:
Ayes 282, Noes 218.
Division No. 222]
[
5.50 pm
AYES
Adams, Nigel
Afriyie, Adam
Aldous, Peter
Alexander, rh Danny
Amess, Mr David
Andrew, Stuart
Arbuthnot, rh Mr James
Bacon, Mr Richard
Baker, Norman
Baker, Steve
Baldry, Sir Tony
Baldwin, Harriett
Barclay, Stephen
Barker, rh Gregory
Barwell, Gavin
Bebb, Guto
Bellingham, Mr Henry
Beresford, Sir Paul
Berry, Jake
Bingham, Andrew
Birtwistle, Gordon
Blackwood, Nicola
Blunt, Mr Crispin
Boles, Nick
Bone, Mr Peter
Bottomley, Sir Peter
Bradley, Karen
Brady, Mr Graham
Brake, rh Tom
Bray, Angie
Brazier, Mr Julian
Bridgen, Andrew
Brokenshire, James
Brooke, Annette
Browne, Mr Jeremy
Bruce, Fiona
Bruce, rh Sir Malcolm
Buckland, Mr Robert
Burley, Mr Aidan
Burns, Conor
Burns, rh Mr Simon
Burrowes, Mr David
Burstow, rh Paul
Burt, Lorely
Byles, Dan
Cairns, Alun
Campbell, rh Sir Menzies
Carmichael, rh Mr Alistair
Carmichael, Neil
Carswell, Mr Douglas
Cash, Mr William
Chishti, Rehman
Clark, rh Greg
Clegg, rh Mr Nick
Clifton-Brown, Geoffrey
Coffey, Dr Thérèse
Colvile, Oliver
Crabb, Stephen
Crouch, Tracey
Davies, Glyn
Davies, Philip
de Bois, Nick
Dinenage, Caroline
Djanogly, Mr Jonathan
Dorrell, rh Mr Stephen
Dorries, Nadine
Doyle-Price, Jackie
Duddridge, James
Duncan, rh Mr Alan
Duncan Smith, rh Mr Iain
Ellis, Michael
Ellison, Jane
Ellwood, Mr Tobias
Elphicke, Charlie
Eustice, George
Evans, Graham
Evennett, Mr David
Fabricant, Michael
Fallon, rh Michael
Field, Mark
Fox, rh Dr Liam
Francois, rh Mr Mark
Freeman, George
Freer, Mike
Fuller, Richard
Garnier, Sir Edward
Garnier, Mark
Gauke, Mr David
Gibb, Mr Nick
Gilbert, Stephen
Glen, John
Goldsmith, Zac
Goodwill, Mr Robert
Gove, rh Michael
Grant, Mrs Helen
Gray, Mr James
Grieve, rh Mr Dominic
Griffiths, Andrew
Gummer, Ben
Gyimah, Mr Sam
Halfon, Robert
Hames, Duncan
Hammond, rh Mr Philip
Hammond, Stephen
Hancock, Matthew
Hands, Greg
Harper, Mr Mark
Harrington, Richard
Harris, Rebecca
Hart, Simon
Haselhurst, rh Sir Alan
Hayes, rh Mr John
Heath, Mr David
Heaton-Harris, Chris
Hemming, John
Henderson, Gordon
Hendry, Charles
Herbert, rh Nick
Hinds, Damian
Hoban, Mr Mark
Hollingbery, George
Hollobone, Mr Philip
Holloway, Mr Adam
Hopkins, Kris
Horwood, Martin
Howarth, Sir Gerald
Howell, John
Hughes, rh Simon
Hunt, rh Mr Jeremy
Huppert, Dr Julian
Hurd, Mr Nick
Jackson, Mr Stewart
Javid, Sajid
Jenkin, Mr Bernard
Johnson, Gareth
Jones, Andrew
Jones, Mr Marcus
Kawczynski, Daniel
Kelly, Chris
Kirby, Simon
Knight, rh Mr Greg
Kwarteng, Kwasi
Laing, Mrs Eleanor
Lamb, Norman
Lancaster, Mark
Lansley, rh Mr Andrew
Latham, Pauline
Laws, rh Mr David
Leadsom, Andrea
Lee, Jessica
Lee, Dr Phillip
Leech, Mr John
Lefroy, Jeremy
Leslie, Charlotte
Lewis, Brandon
Lewis, Dr Julian
Lilley, rh Mr Peter
Lloyd, Stephen
Lopresti, Jack
Lord, Jonathan
Loughton, Tim
Luff, Peter
Lumley, Karen
Macleod, Mary
Main, Mrs Anne
Maude, rh Mr Francis
Maynard, Paul
McCartney, Jason
McIntosh, Miss Anne
McPartland, Stephen
McVey, Esther
Menzies, Mark
Metcalfe, Stephen
Miller, rh Maria
Mills, Nigel
Milton, Anne
Mitchell, rh Mr Andrew
Moore, rh Michael
Mordaunt, Penny
Morgan, Nicky
Morris, Anne Marie
Mosley, Stephen
Mowat, David
Mulholland, Greg
Mundell, rh David
Munt, Tessa
Murray, Sheryll
Newmark, Mr Brooks
Newton, Sarah
Nokes, Caroline
Norman, Jesse
Nuttall, Mr David
O'Brien, Mr Stephen
Offord, Dr Matthew
Ollerenshaw, Eric
Opperman, Guy
Ottaway, Richard
Paice, rh Sir James
Patel, Priti
Penning, Mike
Penrose, John
Perry, Claire
Phillips, Stephen
Pickles, rh Mr Eric
Pincher, Christopher
Poulter, Dr Daniel
Prisk, Mr Mark
Pritchard, Mark
Raab, Mr Dominic
Randall, rh Mr John
Reckless, Mark
Redwood, rh Mr John
Rees-Mogg, Jacob
Rifkind, rh Sir Malcolm
Robathan, rh Mr Andrew
Robertson, rh Hugh
Robertson, Mr Laurence
Rosindell, Andrew
Rudd, Amber
Ruffley, Mr David
Russell, Sir Bob
Rutley, David
Sanders, Mr Adrian
Sandys, Laura
Scott, Mr Lee
Selous, Andrew
Sharma, Alok
Shelbrooke, Alec
Shepherd, Sir Richard
Skidmore, Chris
Smith, Miss Chloe
Smith, Henry
Smith, Julian
Smith, Sir Robert
Soames, rh Nicholas
Soubry, Anna
Spelman, rh Mrs Caroline
Stanley, rh Sir John
Stewart, Bob
Stewart, Iain
Stewart, Rory
Streeter, Mr Gary
Stride, Mel
Stunell, rh Andrew
Sturdy, Julian
Swales, Ian
Swayne, rh Mr Desmond
Swinson, Jo
Syms, Mr Robert
Tapsell, rh Sir Peter
Teather, Sarah
Thornton, Mike
Timpson, Mr Edward
Tomlinson, Justin
Tredinnick, David
Truss, Elizabeth
Turner, Mr Andrew
Tyrie, Mr Andrew
Uppal, Paul
Vaizey, Mr Edward
Vara, Mr Shailesh
Vickers, Martin
Walker, Mr Charles
Walker, Mr Robin
Ward, Mr David
Weatherley, Mike
Wharton, James
Wheeler, Heather
White, Chris
Whittaker, Craig
Whittingdale, Mr John
Wiggin, Bill
Williams, Mr Mark
Williams, Stephen
Williamson, Gavin
Wilson, Mr Rob
Wollaston, Dr Sarah
Wright, Jeremy
Wright, Simon
Yeo, Mr Tim
Young, rh Sir George
Zahawi, Nadhim
Tellers for the Ayes:
Joseph Johnson
and
Mark Hunter
NOES
Abbott, Ms Diane
Abrahams, Debbie
Ainsworth, rh Mr Bob
Ali, Rushanara
Allen, Mr Graham
Anderson, Mr David
Ashworth, Jonathan
Austin, Ian
Bailey, Mr Adrian
Bain, Mr William
Balls, rh Ed
Banks, Gordon
Barron, rh Mr Kevin
Bayley, Hugh
Beckett, rh Margaret
Begg, Dame Anne
Benn, rh Hilary
Berger, Luciana
Blackman-Woods, Roberta
Blears, rh Hazel
Blomfield, Paul
Blunkett, rh Mr David
Bradshaw, rh Mr Ben
Brennan, Kevin
Brown, Lyn
Brown, rh Mr Nicholas
Brown, Mr Russell
Bryant, Chris
Buck, Ms Karen
Burden, Richard
Burnham, rh Andy
Byrne, rh Mr Liam
Campbell, Mr Alan
Caton, Martin
Champion, Sarah
Chapman, Jenny
Clark, Katy
Clarke, rh Mr Tom
Clwyd, rh Ann
Coaker, Vernon
Coffey, Ann
Cooper, rh Yvette
Crausby, Mr David
Creagh, Mary
Creasy, Stella
Crockart, Mike
Cruddas, Jon
Cryer, John
Cunningham, Alex
Cunningham, Mr Jim
Cunningham, Sir Tony
Curran, Margaret
David, Wayne
Davidson, Mr Ian
De Piero, Gloria
Denham, rh Mr John
Dobson, rh Frank
Docherty, Thomas
Donohoe, Mr Brian H.
Doran, Mr Frank
Dowd, Jim
Doyle, Gemma
Dromey, Jack
Dugher, Michael
Durkan, Mark
Eagle, Ms Angela
Eagle, Maria
Edwards, Jonathan
Efford, Clive
Ellman, Mrs Louise
Esterson, Bill
Evans, Chris
Field, rh Mr Frank
Fitzpatrick, Jim
Flello, Robert
Flint, rh Caroline
Flynn, Paul
Fovargue, Yvonne
Francis, Dr Hywel
Gapes, Mike
Gardiner, Barry
Gilmore, Sheila
Glass, Pat
Godsiff, Mr Roger
Goggins, rh Paul
Goodman, Helen
Greatrex, Tom
Green, Kate
Griffith, Nia
Gwynne, Andrew
Hain, rh Mr Peter
Hamilton, Mr David
Hanson, rh Mr David
Harman, rh Ms Harriet
Harris, Mr Tom
Havard, Mr Dai
Healey, rh John
Hendrick, Mark
Hepburn, Mr Stephen
Hillier, Meg
Hilling, Julie
Hodge, rh Margaret
Hodgson, Mrs Sharon
Hoey, Kate
Hopkins, Kelvin
Hosie, Stewart
Howarth, rh Mr George
Hunt, Tristram
Irranca-Davies, Huw
Jackson, Glenda
Jamieson, Cathy
Jarvis, Dan
Johnson, rh Alan
Johnson, Diana
Jones, Graham
Jones, Susan Elan
Kaufman, rh Sir Gerald
Keeley, Barbara
Kendall, Liz
Khan, rh Sadiq
Lammy, rh Mr David
Lavery, Ian
Leslie, Chris
Llwyd, rh Mr Elfyn
Lucas, Ian
MacNeil, Mr Angus Brendan
Mactaggart, Fiona
Mahmood, Shabana
Malhotra, Seema
Mann, John
Marsden, Mr Gordon
McCabe, Steve
McCann, Mr Michael
McCarthy, Kerry
McClymont, Gregg
McCrea, Dr William
McDonnell, John
McFadden, rh Mr Pat
McGovern, Alison
McGovern, Jim
McGuire, rh Mrs Anne
McKechin, Ann
McKenzie, Mr Iain
McKinnell, Catherine
Meacher, rh Mr Michael
Mearns, Ian
Miliband, rh Edward
Miller, Andrew
Mitchell, Austin
Moon, Mrs Madeleine
Morden, Jessica
Morrice, Graeme
(Livingston)
Morris, Grahame M.
(Easington)
Mudie, Mr George
Munn, Meg
Murphy, rh Mr Jim
Murphy, rh Paul
Murray, Ian
Nandy, Lisa
O'Donnell, Fiona
Onwurah, Chi
Paisley, Ian
Pearce, Teresa
Perkins, Toby
Pound, Stephen
Powell, Lucy
Qureshi, Yasmin
Raynsford, rh Mr Nick
Reed, Mr Jamie
Reed, Mr Steve
Reid, Mr Alan
Reynolds, Emma
Robertson, Angus
Robertson, John
Robinson, Mr Geoffrey
Roy, Mr Frank
Roy, Lindsay
Ruane, Chris
Ruddock, rh Dame Joan
Sarwar, Anas
Sawford, Andy
Seabeck, Alison
Sharma, Mr Virendra
Sheerman, Mr Barry
Shuker, Gavin
Simpson, David
Skinner, Mr Dennis
Slaughter, Mr Andy
Smith, rh Mr Andrew
Smith, Nick
Smith, Owen
Spellar, rh Mr John
Stuart, Ms Gisela
Sutcliffe, Mr Gerry
Tami, Mark
Thomas, Mr Gareth
Thornberry, Emily
Timms, rh Stephen
Trickett, Jon
Twigg, Derek
Twigg, Stephen
Umunna, Mr Chuka
Vaz, rh Keith
Walley, Joan
Watts, Mr Dave
Weir, Mr Mike
Whiteford, Dr Eilidh
Whitehead, Dr Alan
Williams, Hywel
Wilson, Phil
Winnick, Mr David
Winterton, rh Ms Rosie
Wishart, Pete
Wood, Mike
Woodcock, John
Woodward, rh Mr Shaun
Wright, David
Wright, Mr Iain
Tellers for the Noes:
Tom Blenkinsop
and
Nic Dakin
Question accordingly agreed to.
22 Apr 2013 : Column 682
22 Apr 2013 : Column 683
22 Apr 2013 : Column 684
Lords amendment 79 disagreed to.
Lords amendments 1 to 77 and 80 to 128 agreed to, with Commons financial privileges waived in respect of Lords amendments 18, 19, 22, 28, 29, 37 to 39, 45, 82, 114, 117, 119 and 127.
Motion made, and Question put forthwith (Standing Order No. 83H), That a Committee be appointed to draw up Reasons to be assigned to the Lords for disagreeing to their amendments 78 and 79;
22 Apr 2013 : Column 685
That Jonathan Ashworth, Greg Hands, Sajid Javid, Chris Leslie and Stephen Williams be members of the Committee;
That Sajid Javid be the Chair of the Committee;
That three be the quorum of the Committee.
That the Committee do withdraw immediately.— (Greg Hands.)
Committee to withdraw immediately; reasons to be reported and communicated to the Lords.
Crime and Courts Bill [Lords] (Programme) (No. 4)
Motion made, and Question put forthwith (Standing Order No. 83A(7)),
That the following provisions shall apply to the Crime and Courts Bill [Lords] for the purpose of supplementing the Order of 14 January (Crime and Courts Bill [Lords] (Programme)):
Consideration of Lords Message
1. Proceedings on the Lords Message shall (so far as not previously concluded) be brought to a conclusion one hour after their commencement at today’s sitting.
Subsequent stages
2. Any further Message from the Lords may be considered forthwith without any Question being put.
3. The proceedings on any further Message from the Lords shall (so far as not previously concluded) be brought to a conclusion one hour after their commencement.—(Mr Syms.)
22 Apr 2013 : Column 686
Crime and Courts Bill [Lords]
Consideration of Lords message
6.3 pm
The Secretary of State for Culture, Media and Sport (Maria Miller): I beg to move, That this House agrees with Lords amendment 17A.
Mr Deputy Speaker (Mr Nigel Evans): With this it will be convenient to discuss the following:
Government amendments (a) and (b) in lieu of Lords amendment 131A.
Maria Miller: Hon. Members will recall that on Report on 18 March the House agreed to a number of new clauses which, together with an amendment to the Enterprise and Regulatory Reform Bill, implement the legislative parts of the cross-party agreement on Leveson. They will also remember that the published clauses, along with the royal charter, enabled the Government to bring forward a cross-party agreement based on a system of incentivisation rather than compulsion. There will be a tough system of self-regulation that avoids full statutory regulation—the Rubicon that the Prime Minister and I refuse to cross. The clauses will put in place the incentive-based, self-regulatory system for the press envisaged by Lord Justice Leveson.
The other place agreed, by and large, with the Commons amendments, but there is one substantive issue that we need to resolve: namely, the position within the new framework of small-scale bloggers. Government amendments (a) and (b) in lieu of Lords amendment 131A address that issue.
It might assist the House if I put the amendments in context by explaining our approach to the definition of “relevant publisher”. At present, four interlocking tests define who is and who is not a relevant publisher for the purposes of these provisions. A relevant publisher must meet all of those. They must publish news-related material, be written by different authors, be subject to editorial control and be published in the course of business, whether or not that is with a view to profit.
We want to ensure that the new approach acts as the incentive that Lord Justice Leveson intended, but we have to be clear and careful about which publishers are covered. He said of the new regulatory body:
“Ideally the body would attract membership from all news and periodical publishers, including news publishers online. It is important for the credibility of the system, as well as for the promotion of high standards of journalism and the protection of individual rights, that the body should have the widest possible membership among news providers.”
However, he was also clear that:
“This is not meant to be prescriptive at the very small end of the market: I would not necessarily expect very small publishers to join the body”.
We have therefore provided a definition of “relevant publisher” that captures national newspapers and their online editions, local and regional newspapers and their online editions, and online-only edited, press-like content providers.
Mike Freer (Finchley and Golders Green) (Con):
My local newspapers are concerned about why regional and local newspapers are caught in the new legislation,
22 Apr 2013 : Column 687
when they were not found to have had a hand in the scandal that brought us to where we are. Will my right hon. Friend reiterate why they are included?
Maria Miller: My hon. Friend is right that that point has exercised many individuals both within the Chamber and outside. It was clear from Lord Justice Leveson’s report that it was his intention for the local press to be part of the new self-regulatory regime. Equally, he understood that there are clear financial pressures on the local press, as there have been for many years, and that provisions might be needed within the self-regulatory regime that treat them differently. That is something for the press to deal with and I understand that they are looking at it. It is important, however, that the local press are part of the opportunity to have self-regulation. I reiterate to my hon. Friend that it is exactly that—self-regulation—and that there is no compulsion. I hope that that provides the reassurance that he is seeking.
Exemplary damages and costs are designed to cover what might be termed more sophisticated news publishers, and will act as a key incentive to join the new press regulator. It is therefore essential that the definition of “relevant publisher” equates to the publications that we expect to be part of the regulator.
Equally, the definition is not intended to capture a host of activities, including small-scale activity online. It is not intended to capture the news aggregation services of operators such as Yahoo! or MSN, or social networking sites. Nor is it aimed at sites that simply moderate the comments of others or aggregate a series of blogs without any active consideration of the content. By that I mean blog hosting services such as WordPress or Tumblr.
I want to be really clear about the matter, because I know that many hon. Members have examined it in detail. To the extent that a website such as Mumsnet runs an online blog forum, that activity is clearly not covered by the definition of “relevant publisher”, as forums are not covered. The provisions may be relevant to a site such as Mumsnet only if it is in the business of commissioning articles and publishing news stories. Such businesses undertake different activities, one of which may well be publishing news, which would bring them into the scope of self-regulation. However, forums such as the one run by Mumsnet would not be covered.
I also wish to clarify again the effects of the definition of “relevant publisher” on news aggregators. It is not our intention that the provisions should capture news aggregators such as Yahoo!, MSN or Google. News and content aggregators who license or otherwise acquire news-related content from third parties control that content only in as far as they decide how to present it in its totality, and to that extent they are not subjecting the material to editorial control. It is therefore not intended that services providing a platform for bloggers to post content are captured. Again, the control exercised by aggregators is limited to the high-level presentation of content, so news aggregators are not captured by our definition.
We have, however, acknowledged the need for clarity, particularly with regard to small-scale blogs. When the provisions were last discussed in the other place, we undertook to have a period of reflection to assess
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whether any further clarity would be helpful and could be provided. My officials have since held a number of round-table discussions with small-scale blog sites to understand their concerns further. The amendments that we have tabled, with cross-party agreement, seek to provide that further clarification.
Amendment (a) will add to the list of exemptions micro-businesses where they are a blog or where their publications are merely incidental to their other business. For organisations that publish news-related material incidentally to their main activity, that exemption will cover both online and traditional print. We use a definition of a micro-business commonly used by the Department for Business, Innovation and Skills, which captures any business with fewer than 10 employees and a turnover of less than £2 million. The amendment will ensure that a micro-business that is either a small-scale blog or a website whose publication of news-related material is only incidental to its wider business is not included. That should place many blogs and other small web publishers squarely outside the incentives framework.
Amendment (b) will allow those not captured to get the benefit of the costs incentives if they choose to join the recognised regulator, even though they are not a relevant publisher. That means that those exempted by virtue of the fact that they are a micro-business can choose to gain the benefits of the costs clauses by joining the regulator, providing an incentive for them to join if they so wish and a choice to small organisations, perhaps before they grow in size and inevitably become a relevant publisher. That is an important addition that will help support that part of the market.
I can deal briefly with Lords amendments 17A and 17B. In short, the objective of the new costs regime is to incentivise publishers financially to join the regulator. The intention behind subsection (2)(a) of the new clause “Awards of costs”, originally inserted in the Commons, is to allow costs to be awarded against a regulated publisher only if the claim before the courts is not capable of being resolved through the self-regulator’s arbitration scheme. However, to achieve that effect, the word “not” needs to be inserted into that subsection to avoid the opposite being the case. That was a simple drafting error that is corrected by Lords amendment 17A.
Lords amendment 17B removes subsection (4) of the new clause “Awards of costs”, which we have concluded after further discussion is unnecessary and unduly restrictive.
The clauses to which the Lords amendments relate have been carefully constructed to enable a system of incentivisation, which will form the basis of a new, tough self-regulator for the press in line with Leveson principles. The amendments are far removed from those that the noble Lords Skidelsky and Puttnam, among others, proposed for consideration in this House. Let us be clear that had we not successfully negotiated a cross-party royal charter, the House could well be debating a system of full statutory regulation that would have undermined the freedom of this country’s press.
6.15 pm
Mr John Redwood (Wokingham) (Con): I am grateful to the Secretary of State for trying to give us greater clarity. Does she intend that websites run by political parties and MPs that comment on news and current affairs will not be included in the system?
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Maria Miller: As always, my right hon. Friend cuts to the quick with a question that is important to many of us. If he examines the detail of our provisions and exemptions, and the Leveson report, he will see that the intention behind everything that we are doing is to focus self-regulation on those who publish news. I do not believe that any political party or MP intends primarily to publish news. That will be secondary, so it is not our intention that such websites should be the primary focus of the provisions. Obviously, there will be areas in the margins that need further clarification, and the courts will be able to provide that over time.
Dr Julian Huppert (Cambridge) (LD): I am pleased that we are able to examine these details, because there has been much concern. I would be grateful for guidance on a few specific issues about how the provisions should be interpreted. For example, a lot of multi-author blogs involve people who are self-employed or who work on a voluntary basis. How should the number of employees be dealt with? Will the Secretary of State provide guidance on that, and on what the definition of a blog is?
Maria Miller: It will be full-time employees who are included in the employment measure, which is why it is important that not just employment but turnover is considered. Many organisations utilise a number of self-employed people, hence the twin-track approach.
We have set out what we anticipate being considered a blog, which is about individual opinion being set forth through electronic media. That is relatively straightforward, although as I said to my right hon. Friend the Member for Wokingham (Mr Redwood), there will always be more difficult matters to consider at the margins and the courts will be able to provide further information. We will also provide guidance in the usual way.
The amendments address concerns raised by small-scale bloggers and other small businesses and will ensure that the definition of “relevant publisher” captures the news publishers that were the focus of Lord Justice Leveson’s inquiry. They have the full support of all three major parties in the House, and on that basis I commend them to the House.
Helen Goodman (Bishop Auckland) (Lab): I am pleased to be able to take part in this debate, which nails down the final details of the recommendations that Lord Justice Leveson made about setting up a new self-regulatory system for the press. When the Bill was introduced into the House a year ago, Lord Justice Leveson had not even reported, so we were fortunate to be able to thumb a lift with the Bill.
On 18 March, on Third Reading, the House agreed to insert new clauses providing for new rules on exemplary damages and costs. They are an essential part of the cross-party agreement on a royal charter, which is part of the new framework of independent self-regulation guaranteed by law.
As the Secretary of State said, the Bill aims to provide publishers with incentives to sign up to the new system of self-regulation that should meet the criteria set out in the royal charter. Publishers that join the recognised regulator will receive protection from the award of exemplary damages in media disputes, the opportunity to use an arbitration service, and cost benefits from having access to the arbitration service—that is one
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reason why it would benefit local as well as national newspapers. If a complainant chooses not to use the arbitration service, they can still be liable for costs even if they win.
Lord Justice Leveson’s report was about the press, but the original drafting had the unintended effect of catching blogs in the net—a point noted in this House by my hon. Friend the indefatigable Member for West Bromwich East (Mr Watson). That said, Lord Justice Leveson expressed the hope in recommendation 73 of his report that online publishers would also join a regulator. The Bill therefore needed to be amended to ensure that exemplary damages did not apply to blogs, but that they could receive the benefits of joining a recognised regulator. The Lords agreed a number of amendments, including a placeholder amendment, on 25 March.
The Government’s decision to hold a “mini-consultation”—as I think the Secretary of State called it—to pause for reflection and consider the blogosphere was sensible. With the best will in the world, middle-aged Members of Parliament in both Houses are perhaps not absolutely up to speed with the way in which the blogosphere operates among the next generation, but I think we have now got it right. The Labour party agrees with the policy objectives that the Government are seeking to address: to exempt micro-businesses from the definition of “relevant publisher” where they are a blog or their publications are merely incidental to their other business; and to enable such micro-businesses to receive the benefits and cost incentives if they join a recognised regulator. The amendments use the micro-business definition for a small blog as one whose turnover is below £2 million and has up to 10 employees. It exempts such businesses from exemplary damages and enables them to benefit from the cost advantages of an arbitration service if they join a regulator—that last point will be particularly welcome in that community.
Labour supports Lords amendments 17A and 17B and amendments (a) and (b) in lieu of amendment 131, and we will not divide the House in this debate. However, there is a thicket of double negatives, and for those outside the House who are following proceedings closely I ask the Secretary of State to provide assurances and clarity on a couple of points. Will she tell the House whether this approach minimises the risk of gaming, in particular by groups of companies? What is the position of campaigning groups’ newsletters—the right hon. Member for Wokingham (Mr Redwood) raised that point? I thought that Mumsnet would be excluded because its primary purpose is not to publish news—it is clear that motherhood is not a hobby, so it is not excluded on those grounds—or, indeed, UK Feminista. Neither of those is a charity and it might help if the Secretary of State said a little more about the newsletters of campaigning groups.
Will she confirm that access to the arbitration system for those outside the regulatory body is limited to small-scale blogs, and say why she chose that approach? The hon. Member for Cambridge (Dr Huppert) asked about the definition of “blog”, and I assume that the Secretary of State has received legal advice that the word will be properly interpreted. She has already explained why she is addressing only the number of employees, and not those who are self-employed, but if she could elucidate a little on those points it would be helpful and we will be happy to support her this evening.
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Dr Huppert: I do not wish to detain the House long but I am pleased that we have finally reached this point and that important details of Leveson are agreed. If I had been asked when I first looked at the Crime and Courts Bill which part I thought would keep us in ping-pong, it would not have been this provision or anything to do with blogs. I do not know whether the hon. Member for Bishop Auckland (Helen Goodman) was referring to me as a middle-aged man. I am the proud holder of a Liberal Democrat Voice “blogger of the year” award, but even I would have struggled desperately to write this provision or make all the definitions. I hope that the Secretary of State has been able to be clear. There will be people who try to game this, but that is true of all legislation. I hope that the Bill has been made as game-proof as possible, while preserving the pleasure of the games that people play on blogs. I am delighted that we are at this point and I will not take up any more of the House’s time. I look forward to the Bill being enacted and I hope that the Secretary of State will clarify those few remaining points.
Maria Miller: I thank the hon. Member for Bishop Auckland (Helen Goodman) for her helpful support as we try to resolve the final details of the Bill. Hon. Members have raised a number of issues in the short period that we have to debate the Bill, and hopefully I can resolve them to everybody’s satisfaction.
I think that by “gaming” the hon. Lady meant the ability of companies to try to buck the system we have set up. It is always difficult to give a categorical assurance on that, but I think our approach minimises the risk of organisations taking such an approach. We have minimised the risk by using the definition of a micro-business, which does not just consider one element—staff—but staff and turnover. Therefore, if an organisation decided to ensure that all its staff were freelancers, it could not then play with its turnover in a way that would make it a micro-business. Equally, individual businesses will find it difficult to disaggregate their businesses in a way that would leave them registered as micro-businesses, and then duck the system without compromising the way in which they operate on a day-to-day basis. Furthermore, a court will be capable of looking at the facts of a case to see whether an organisation has attempted to get around the rules, and that would be a material consideration. If an organisation was trying to circumvent the rules in the way it structured itself, the usual sanctions would be available.
We are interested in many different organisations, but particularly campaigning groups. A number of other exemptions already exist in the definition of “relevant publisher” that deal with campaigning newsletters—a point that the right hon. and learned Member for Camberwell and Peckham (Ms Harman) and I have discussed on a number of occasions. A public body or charity that publishes news-related material in connection
22 Apr 2013 : Column 692
with carrying out its functions, or a person who publishes a newsletter, circular or other document relating to their business that contains news-related material only incidentally, will not be caught by the self-regulatory approach. Such things will be exempt from these measures, which is important. News, and the delivery and publication of news, is not central to a company’s business, and I underline that point for all questions raised by hon. Members. Hopefully, that will provide some certainty on campaigning groups.
The fourth point raised by the hon. Member for Bishop Auckland was access to arbitration for those that may not be termed as “relevant publishers”, other than those that are micro-businesses—excuse me, Mr Deputy Speaker, for getting into the weeds with this, but it is necessary to answer the hon. Lady’s questions. Our consideration of micro-businesses in connection with blogging was to ensure that we did not unintentionally capture those businesses within the self-regulatory system, and also to ensure that those businesses were able—should they choose—to opt in to the self-regulatory part of the framework if they felt that was beneficial. It was never our intention more broadly to allow people to become a “relevant publisher”, not least because that would be outside the scope of today’s discussions. It is not our intention to allow people who are not relevant publishers in that way to have access to that status over and above the exemption we have outlined. Anything to do with the running of the self-regulatory regime is for the press to consider in more detail. We did not intend to cover that in our proposals today—the hon. Member for Bishop Auckland has raised that matter with me.
6.30 pm
The hon. Member for Cambridge (Dr Huppert), speaking for the Liberal Democrats, raised the final issue of the definition of “blog”. We are comfortable that there is a clear articulation of “blog” and “news”. Blogs are to do with the expression of the point of view of an individual or group of individuals. That is pretty straightforward, although, as with everything else, it will be subject to the courts’ deliberations at the appropriate time.
Finally, the hon. Member for Bishop Auckland implied that the Government believed an error had been made on micro-blogs, which therefore required an amendment. I should gently tell her that we feel that the measure was reasonably clear to start with, but that the amendment adds extra clarity. In that spirit, I thank you, Mr Deputy Speaker, for allowing me to explain the amendments. I also thank the hon. Lady for her support, and the hon. Gentleman who spoke for the Liberal Democrats for his support.
Lords amendment 17A agreed to.
Lords amendment 17B agreed to.
Government amendments (a) and (b) made in lieu of Lords amendment 131A.
22 Apr 2013 : Column 693
Partnerships (Prosecution) (Scotland) Bill [Lords]
Bill, not amended in the Public Bill Committee, considered.
6.32 pm
The Parliamentary Under-Secretary of State for Scotland (David Mundell): I beg to move, That the Bill be now read the Third time.
The Bill takes forward the proposals of the Scottish Law Commission to address the loophole in Scots law that prevents the prosecution of partnerships that have dissolved. It addresses the limitation of the law in Scotland which meant that attempted prosecutions could not proceed following the serious fire at Rosepark nursing home in Uddingston, Lanarkshire on the night of 31 January 2004, when 14 people tragically lost their lives. Rosepark was run by three individuals who had come together to form a business partnership. Following the fire, the partnership dissolved. The partnership, as employer, was alleged to have committed offences under the Health and Safety at Work Act 1974. The Crown Office made three attempts to prosecute the partnership, but as the High Court had held that the partnership ceased to exist on dissolution, the prosecutions could not proceed.
In November 2012, the Bill was introduced to Parliament by the Advocate-General for Scotland. The Bill is one of only three Scotland-specific Bills introduced in Westminster since devolution. It reminds us that Scotland has two Governments and two Parliaments, both with their own contributions to make in improving the lives of people in Scotland.
The Bill marks a significant milestone. This is the first occasion when the House of Lords special Public Bill procedure for Law Commission Bills has been used in relation to Scottish Law Commission proposals. The special procedure allows non-controversial legislation to sidestep the competition for parliamentary time on the Floor of the House. The Bill demonstrates why that procedure is so valuable.
The Bill progressed through Committee in both Houses, allowing close and robust scrutiny of each of its clauses, with good opportunity for debate. It has received broad consensus from all sides. I thank the hon. Member for Glasgow North East (Mr Bain) and all hon. Members who have participated in the process.
The Government are grateful to the Scottish Law Commission, and in particular to Patrick Layden, who has worked tirelessly alongside the Advocate-General for Scotland and the Scotland Office to produce a Bill that provides a very simple, very sound solution that ensures that partnerships and culpable partners cannot evade prosecution by dissolving.
The support demonstrated by hon. Members is gratefully noted. We are particularly grateful to the hon. Member for Lanark and Hamilton East (Mr Hood), in whose constituency the Rosepark nursing home was situated. We also gratefully note the support of the Scottish Government. We are immensely grateful for the support demonstrated by the Lord Advocate, the Faculty of Advocates and the Law Society of Scotland, which have all broadly welcomed the Bill, in giving evidence to the special Public Bill Committee in the other place.
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The provisions of the Bill are to be commenced the day after Royal Assent. The Bill makes valuable and necessary reforms to the law of partnerships in Scotland and I commend it to the House.
6.35 pm
Mr William Bain (Glasgow North East) (Lab): The Opposition endorse Third Reading. Throughout previous stages of the Bill both in this House and in the other place, right hon. and hon. Members have kept very much at the forefront of our minds the families and the 14 people who lost their lives in the dreadful fire at Rosepark nursing home in Uddingston, south Lanarkshire, which was caused by an earthing fault at the back of an electrical distribution box in a storage cupboard at the nursing home.
As I said in Second Reading Committee, a fatal accident inquiry in 2011 chaired by Sheriff Principal Brian Lockhart established that some or all of the lives lost could have been saved if a risk assessment had been conducted and if it had led to the taking of reasonable precautions. That could have avoided or minimised the loss of life. The inquiry found fault with the maintenance of the electrical installation at the care home; inadequate fire safety and drills; inadequate management of fire safety, which was found to be systematically and seriously defective; and weak interaction between the nursing home and Lanarkshire health board.
The laws we make in this House can never repair the feelings that arise from the loss of loved ones, but the Bill will ensure that others never suffer a similar lack of closure as a result of flawed processes in the criminal law caused by deficiencies in the law of partnerships in Scotland. We should therefore welcome the work of the Scottish Law Commission on the matter, its continuing contribution to keeping the laws of Scotland made by both Parliaments under review, and its recommending modernisation when necessary in the public interest.
In particular, we welcome the work predating the Bill that was done on the consultation process by the commission’s chair, Lady Clark, the former Member for Edinburgh Pentlands and former Advocate-General for Scotland; by the commission’s previous chair; by Lord Drummond Young; and by Mr Patrick Layden QC. Although the Scottish Law Commission consulted widely on whether it should attempt to deal with the problem by virtue of a comprehensive reform of partnership law, in the end, pending consideration of wider reforms, the commission settled on the more targeted solution of permitting partnerships to have a degree of continuing legal personality for a limited period in terms of criminal proceedings and prosecutions.
The Opposition welcome the fact that the Bill shows this Parliament’s continued belief in the importance of the reform of private law in Scotland under areas reserved to the UK Parliament under the Scotland Act 1998. Scotland has two Parliaments that make laws on behalf of its people. It is noteworthy that the Bill is the third Scotland-only Bill on a reserved matter to be debated in this House since the devolution of power to the Scottish Parliament in 1999. I hope there will be many more of them in the future, should the people of Scotland choose to remain within the United Kingdom in the referendum to be held next year.
The tragedy at Rosepark nursing home in 2004 claimed the lives of 14 residents. However, because the partnership that owned and managed the home was dissolved after
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the fire, but before the Crown Office in Scotland could initiate any proceedings for prosecution, the partnership could not be prosecuted. That principle was established in the case of Balmer
v.
Her Majesty’s Advocate in 2008. Following the decision in that case, the Scottish Law Commission published a discussion paper and consulted on possible options for reforming the law of partnerships in Scotland in this area. That consultation led directly to the Bill before the House this evening.
It is an important principle of commercial law that the legal personality of a company or partnership differs from that of the directors or partners. It is possible to prosecute a partnership in Scotland quite separately from the individual partners under Scots criminal law. Indeed, it is vital that we uphold the concept that legal persons, as well as the individual partners in their own right, can be subject to liability for actions deemed to be breaches of the criminal law.
Another core principle of the law of partnerships in Scotland is that of joint and several liability for civil and criminal obligations incurred by the partnership. Should a partnership be convicted of an offence following prosecution and be subject to a fine, then any or all of the partners may be held liable for payment of any such fine imposed by the courts. That has been seen as critical in ensuring that the law can attach responsibility for payment to at least one member of the partnership. That partner then has the right to seek recompense for the outstanding share of the financial liability thereby incurred from the other partners, through a civil action under the partnership agreement and the Partnership Act 1890.
The Bill closes the loophole in the law that was exposed by the Rosepark tragedy. It will permit a prosecution to be brought against a dissolved partnership up to five years following the deemed dissolution in respect of conduct that arose out of the partnership while it was still in existence. Actions in criminal law may also be brought against partnerships where the composition of partners or the membership structure have altered, where partners have left, or new partners have joined. Any member of a partnership may thus still be liable for any criminal offences committed while a member of the partnership and through any change in composition.
Circumstances that could give rise to prosecutions under the clause include: potential breaches of section 36 of the Health and Safety at Work etc. Act 1974; cases where an individual’s acts or omissions have been a cause of the offence; cases where an individual is held guilty, art and part, of a common-law or statutory offence; cases where an individual has aided, abetted, counselled or procured the commission of an offence under statute law; or cases where an individual has committed an offence with their consent or connivance, or even through neglect. The range of offences potentially liable for commission by individual members of a partnership was significantly widened by the Scottish Parliament, through section 53 of the Criminal Justice and Licensing (Scotland) Act 2010.
Should a partnership be convicted of an offence, any legal rule, whether in statute or common law, relating to the liability of the partners, applies as if the partnership had not been dissolved. This permits joint and several
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liability for any fine imposed by the courts following a successful prosecution, in line with sections 4 and 9 of the Partnership Act 1890 and subject to the provisions in clause 3 of the Bill. Any fine imposed following a conviction may be recovered against the assets of the partnership, or any or all of the individual partners, each of whom would have a right to claim a remedy for the other shares from assets of the partnership, or from the other partners’ personal assets. In some statutes, such as the Health Act 2006, the law restricts the payment of fines to the partnership assets only, but for a dissolved partnership under the Bill that rule will not apply, because if a partnership is dissolved there will be no partnership assets and any fine might otherwise prove to be unenforceable—that would be unacceptable.
The sole element of contention that arose during the passage of the Bill, in this House and in the other place, stemmed from clause 4, under which it is possible for someone to have joined a partnership after the commission of a potentially prosecutable offence and then face liability for some or all of any penalty applied by the court following a finding of guilt, despite the fact that that person was not involved at the partnership at the time of commission of the offence. That was a significant concern for the Law Society and others in Scotland, as many businesses are organised through the partnership model.
I moved a probing amendment in Committee, following similar amendments that had been moved in the other place, to test the arguments as to whether an exemption could be created for innocent partners who become members of a firm, but are unaware of any potential criminal liability that could give rise to conviction and the imposition of a fine, who then face demands to meet a share or even the entirety of a fine from personal assets in the absence of partnership assets or personal assets from the pre-existing members of the firm. We were reassured by the Commission that it is likely to keep the operation of this provision under review, and that a more comprehensive analysis of the potential reform of partnership law remains a possibility. In that spirit, we were happy to withdraw the amendment.
In conclusion, the Bill closes an important loophole that the unsuccessful attempts to prosecute the owners of Rosepark nursing home, following the fatal fire, brought to light. We cannot remove the suffering that the families and loved ones of the deceased have experienced in these past nine years, but we can ensure that, by enacting these reforms, other people affected by the conduct of partnerships are never put in a similar position again. That is the best tribute we in this Parliament can make to the 14 people who so tragically and unnecessarily lost their lives. For those reasons, the Opposition strongly support the Bill.
6.47 pm
Mr Mike Weir (Angus) (SNP): I would also like to add my support to the Bill. You may be witnessing an almost unique occasion, Mr Deputy Speaker: all parties in this House and the Scottish Government and Parliament support the Bill and are anxious for it proceed. As has been said, the genesis of the Bill was the Rosepark fire—a great tragedy in which many people unnecessarily lost their lives—and the inability, because of this quirk in Scottish partnership law, to prosecute. It is important that that is put right.
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We had a good debate in Committee. The speech from the hon. Member for Glasgow North East (Mr Bain) probably went on as long as the Committee stage, but the Bill was considered in Committee in detail. As he said, the Law Society of Scotland still has a concern—I should perhaps declare a tangential interest as I used to be a member—regarding its impact on partnerships. We went into this in some detail, and I think none of us could come up with a way of dealing with this particular issue. However, it is important to make the change, irrespective of slight concerns. I hope the Bill proceeds. As the hon. Gentleman rightly said, there is nothing we can now do for the people who so tragically lost their lives at Rosepark, but we can ensure that it does not happen again. We have come together to do that.
The Minister and the hon. Member for Glasgow North East were slightly naughty to present the Bill as an argument for the Union, as it could have been introduced in any place that had the power to do so, whether in Edinburgh or London. The hon. Member for Glasgow North East said that this was the third Scotland-only Bill on a reserved matter to be debated in this House since devolution. It will undoubtedly be the last—the next will be in an independent Scottish Parliament.
David Mundell: With the leave of the House, I will seek to conclude this debate on the basis of agreement. I am sure that this will not be the last Bill affecting only Scotland brought before the House, but we will leave those debates for another day.
I concur with the hon. Members for Glasgow North East (Mr Bain) and for Angus (Mr Weir) that the Bill will, I hope, go some way to set right the wrongs of the Rosepark fire and bring some comfort to the families of the victims on that terrible evening.
I would like to thank members of staff in the Scotland Office and the Office of the Advocate General who worked hard to bring the Bill before the House. I am pleased that we can now move forward with it in a spirit of consensus in order to deal with an identified anomaly in the existing laws of Scotland. I commend the Bill to the House.
Bill accordingly read the Third time and passed.
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Section 5 of the European Communities (Amendment) Act 1993
6.50 pm
The Financial Secretary to the Treasury (Greg Clark): I beg to move,
That this House approves, for the purposes of section 5 of the European Communities (Amendment) Act 1993, the Government’s assessment as set out in the Budget Report, combined with the Office for Budget Responsibility’s Economic and Fiscal Outlook, which forms the basis of the United Kingdom’s Convergence Programme.
I welcome this opportunity to listen to Members’ views on the British Government’s submission to be made this year under section 5 of the European Communities (Amendment) Act 1993. It is nice to see the hon. Member for Nottingham East (Chris Leslie) in his place. I think we have spent more time opposite each other than we have with our respective spouses in recent weeks.
As in previous years, the Government will provide information to the European Commission on the UK’s economic and budgetary position in line with our commitments under the EU stability and growth pact. This submission, known as the convergence programme, is a legal requirement under agreements this country has entered into, and of course the British Government take such commitments seriously. One must also say, however, that its very name represents something of a relic from a past age—a time when Britain was still ruled by a Government committed in principle to joining the single currency. I can assure the House that that era is well and truly dead and buried.
Members might well ask what purpose is served by this annual exercise and the associated debate in the House. [Interruption.] I thought that this might find an echo in the Chamber. Without wishing to anticipate Members’ contributions, which I look forward to, I would like to suggest three areas for this afternoon’s discussion. I wish first to debate British economic policy within the still relevant context of Europe; secondly, to consider the co-ordination of national economic policies across the EU; and thirdly to reflect on our great good fortune in not having joined the single currency, despite the siren voices heard in this place and elsewhere—thanks, in no small measure, to those who had the courage and foresight to speak against British involvement at a time when their warnings were subject to such derision.
Kelvin Hopkins (Luton North) (Lab): I remember a time when all three major parties, the TUC and just about every good and great person across the land supported joining the exchange rate mechanism. I was one of those who from the beginning said that we should not do so. At the moment, we are all against the single currency, but I remember a time when even the Minister’s party was moving in that direction.
Greg Clark:
I do not think that that is entirely right, although I happily acknowledge that the hon. Gentleman was on the side of right throughout. I remember working for the Foreign Secretary when he was leader of our party. In November 1997, when, as the hon. Gentleman said, the received opinion was that our joining was inevitable, my right hon. Friend made the courageous decision to set out in a lecture to the conference of the
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CBI, which then was in favour of joining, the forensic reasons why it would not be in our interests. He committed then, right at the beginning of the parliamentary process that resulted in these measures, to campaign for Britain to stay outside it. While I acknowledge the hon. Gentleman’s distinguished record, I think he would acknowledge that the Conservative party was the first party to commit itself to oppose these measures.
The Government plan to make their submission by 30 April, with the approval, we hope, of both Houses of Parliament. It explains the Government’s medium-term fiscal policies, as already set out in the 2012 autumn statement and Budget 2013, and includes the Office for Budget Responsibility’s forecasts. We think it right and proper to draw from previously published documents presented to Parliament, rather than incur the cost and time to produce bespoke documents for this purpose.
Mr William Cash (Stone) (Con): Is my right hon. Friend aware that the very document to which he refers states:
“The IMF forecasts UK GDP per person to grow faster than the rest of the G7 between 2012 and 2017, with the exception of the US”?
Of course, he will have read the comments made by Madame Lagarde only yesterday. Does he not find them a little incongruous, given that the IMF is now taking rather a different view?
Greg Clark: The IMF is considering its view, and we will see what it has to say in the months ahead, when it issues its review. We have always been clear that, as we have advised all EU member states, keeping control of finances is an important precondition for growth. That is an important matter.
As I said, we have been parsimonious in not generating excess quantities of paper. Members will be aware—certainly my hon. Friend the Member for Stone (Mr Cash) will be—that we did not follow the advice that other countries followed and align our financial year to fit in with the norm in Europe. We think it right to stick with our financial year and make use of the documents presented.
With the Budget announcement having taken place on 20 March, shortly before Easter, I appreciate that the timetable was tight, but we made every effort to provide early copies of the convergence programme to the House and the other place in advance of this debate.
Chris Leslie (Nottingham East) (Lab/Co-op): What was going on with the Order Paper before the debate? I think that the Leader of the House, or perhaps the Minister, tabled a motion not to have this debate, but to kick it up to a Delegated Legislation Committee. I understand that some hon. Members, including the hon. Member for Stone (Mr Cash), objected, and now we are not debating whether to have the debate upstairs. What was going on? Why did the Government try to shove this out of the line of sight?
Greg Clark:
The hon. Gentleman is aware that I am always happy to debate with him, especially on the Floor of the House, which I very much prefer. He will know that at this time in the parliamentary Session, as
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we approach the end of the Parliament, the business managers—the Leader of the House is here—are particularly jealous of the Chamber’s time, including in respect of the sorts of debate we have had today. They had the foresight, however, to anticipate being fortunate enough to have some time today on the Floor of the House. It was right, therefore, that we agreed with the proposal, and here we are today.
As I said, we have economically re-versioned the Budget 2013 document to set out the Government’s assessment of the UK’s medium-term economic and budgetary position. As confirmed by the independent OBR, the UK economy is still recovering from the biggest financial crisis in generations, one of the deepest recessions suffered by any major economy and a decade of hollow growth built on unsustainable debt levels. In June 2010, the Government set out a comprehensive strategy to deal with the deficit, protect the economy and provide for the foundations of recovery. This economic plan combines monetary activism with fiscal responsibility and supply side reform.
The Government are making progress. We have restored fiscal credibility, thus enabling an activist monetarist policy and the automatic stabilisers to support the economy. The deficit has been cut by a third over three years and is projected to fall in every year of the forecast. The OBR has judged that the Government remain on track to meet the fiscal mandate one year early, while 1.25 million private sector jobs have been created. Employment is just below record levels and we have kept interest rates at near-record levels, helping families and businesses.
However, there is much more to do. It is important that we understand why the road to recovery has been more difficult than was first anticipated. Although Opposition Front Benchers profess an internationalist outlook, they sometimes debate economic policy as though Britain’s economy was closed off from the rest of the world and invulnerable to other countries.
Mr David Nuttall (Bury North) (Con): Given that we have faithfully submitted convergence programme documents every year for a number of years, is the Minister as surprised as I am that some of our continental neighbours have not taken a bit more notice of the path that this Government have pursued or taken a bit more action to get their spending in line, as this Government have?
Greg Clark: In fact, some countries are recognising that, but we want to set an example. It is important that we stick to our plans and continue to benefit from the confidence that the markets have shown through the level of interest rates. We also say in our deliberations in Brussels, as well as making the point in budget discussions, that when times are difficult, belts need to tightened.
Kelvin Hopkins: I must say that I am astonished. It is almost as if no one in the Chamber has read the newspapers over the weekend and seen the IMF report that it got the premise for austerity completely wrong. Owing to a mistaken figure in a spreadsheet, we are all going for austerity, which is a terrible mistake. Is that not the reality?
Greg Clark:
I do not agree with that. The hon. Gentleman will be aware that the IMF recommends to many countries around the world, not least in Europe—this
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is the point my hon. Friend the Member for Bury North (Mr Nuttall) referred to—that they should get their public finances in order.
When the Office for Budget Responsibility revised its forecast for global economic growth—and eurozone growth in particular—and world trade downwards, that had an inevitable impact on UK growth, given that the euro area is the destination for 40% of UK exports. Over the past year, net trade was the key factor in the underperformance of the economy relative to earlier OBR forecasts, as well as in the downward revision of the forecasts this year and the year after. Fiscal consolidation, on the other hand, has not had a larger drag on the economy than the OBR expected in June 2010. Indeed, the UK’s fiscal situation argues strongly in favour of maintaining our commitment to deficit reduction.
Opposition Members sometimes accuse us of going too far, too fast, but there is further to go and we must get there as fast as we sensibly can, not least because so much rests on the market-tested credibility earned by this Government. The near historic low gilt yields that underpin the low interest rates that are so important to millions of households and businesses cannot be put at risk. As shown by global developments, the consequence of losing market confidence can be sudden and severe. A sharp rise in interest rates would be particularly damaging to an economy weighed down by the burden of so much public, corporate and personal debt, built up during a time when it should not have been.
Mr Cash: The OBR’s executive summary states:
“Public sector net debt…is forecast to peak at 85.6 per cent of GDP in 2016-17, rather than 79.9 per cent a year earlier as in our December forecast.”
In reality, debt is simply out of control, although much of it is the responsibility of the previous Government.
Greg Clark: Of course my hon. Friend is right that the inevitable consequence of running a deficit is that debt increases. It continues to be our purpose to reduce the deficit and return the economy to a balanced budget in order to start to pay down debt, and it is important that we should do that.
Budget 2013 also set out measures to equip the UK to compete in a global race. The Government will give every business and charity a £2,000 allowance towards their national insurance contributions from April 2014, benefiting more than 1 million businesses. We will achieve the ambition for the UK tax system to be one of the most competitive in the world, which includes a further cut in corporation tax to 20%—the joint lowest in the G20—from April 2015. We will increase capital investment plans by £3 billion a year from 2015-16. Public investment will be higher on average over this Parliament and the next than under the previous Government. We will devolve a greater proportion of growth-related spending to local areas from April 2015, in response to Lord Heseltine’s review.
As well as action in the UK to tackle the economic challenges that we face, progress needs to be made to tackle the crisis in the euro areas. However, the growth challenges in Europe continue to be serious, as every Member is aware. We have seen a welcome fall in borrowing rates, particularly for Spain and Italy, from the high levels that they reached last summer, but recent
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events in Cyprus remind us—and leave us in no doubt—that the euro area continues to be a fragile environment. Only a sustained period of successful reforms and improvements in financial markets can lay the foundations for growth. Economic activity in the European Union remains subdued. In the euro area, most of the so-called peripheral economies are in pronounced recessions, with weak labour markets, adverse credit conditions and an ongoing process of deleveraging all weighing on growth.
Structural reforms at the national level should be supported by the co-ordination of progress towards freer markets at the EU level. The improvement of the single market, regulatory reform and free trade agreements can all help to improve the growth prospects of every country in the EU at a minimal cost. This is a critical agenda that the UK and other like-minded states have advanced at successive European Councils, including in March, and we will continue to push.
Mr Cash: My right hon. Friend says that it is critical that we enter into EU free trade agreements. I hope he appreciates that under the majority voting system, the power of the European Commission under the Lisbon treaty means that at present our influence is only 8% at maximum—although it will shortly rise, albeit to only 12%. The whole policy will effectively be driven by the European Union and its objectives, which are largely dominated by Germany. It will not be in British interests.
Greg Clark: It is possible for our influence to go beyond our voting weight, just as there are Members of this House—I might include my hon. Friend in this—whose influence goes beyond their proportional representation in this place. I hope he agrees with that.
It is important to maintain momentum on bilateral EU free trade agreements. Ninety per cent of global growth will come from outside Europe after 2015, so the EU needs an outward-looking trade agenda. A free trade agreement with the United States of America is, and must be, a major opportunity that should be pursued with all vigour. It is estimated that EU free trade agreements that are currently under way or in the pipeline could add £200 billion to EU GDP and create 2 million jobs across the EU. We welcome the European Commission’s stated commitment to bringing forward concrete proposals to reduce regulatory barriers for small and medium-sized enterprises. That is long overdue and we look forward to seeing those proposals in June.
It is estimated that removing all barriers in the single market would increase UK GDP by about 7%, while prices could fall by 5% due to increased competition. The single market already adds €600 billion a year to the EU’s economy. Further progress is possible. Ambitious implementation of the services directive by all member states could result in increased national incomes. Service liberalisation would be particularly beneficial to the UK, as services are an area of enormous comparative advantage, as we know, and the UK has had a trade surplus with the EU in services since 2005.
Mark Reckless (Rochester and Strood) (Con):
The Financial Secretary cites a number of reports that credit apparently enormously large gains to the single market and, potentially, other trade arrangements. May I ask him to look at the original reports with a certain scepticism?
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When I used to work with him, I think he would have been disappointed if I had done my analyses in the same slapdash way.
Greg Clark: One of the reasons why I was pleased to employ my hon. Friend was his forensic and questioning eye. He is absolutely right that when we look closely at the measures and their estimated impact, we should make our own assessment. However, I think that all of us, including my hon. Friend, would agree that a genuine single market in, for example, energy—an area in which he and I have an interest—could help to increase competition in the EU. As we know, competition is one way we can drive efficiency, which is very much in the interests of all citizens in this country and across the EU.
In addition to structural reforms involving each EU member state and the co-ordination of free trade policies at the EU level, we need reforms in the way the EU works. In his speech of 23 January, the Prime Minister proposed certain principles for reform. He said that the EU had to improve its competitiveness, to become a more flexible organisation, to ensure that its rules were fair for all members and to allow power to flow from the EU to its members and not just the other way around. He also said that the EU had to improve its democratic accountability and to re-engage with voters across Europe. It is national Parliaments that provide the true source of real democratic legitimacy and accountability in the EU. The fact that this debate tonight is being held at the behest of the Chairman of the European Scrutiny Committee serves only to underline that important fact.
Those objectives are complicated by the presence in the EU of the eurozone. Britain has an immediate interest in the stability of the single currency, and we need to be aware of the changes that a more tightly integrated euro area will bring to the EU’s present structure. It is important that we ensure that the EU continues to work for all its members, and that the interests of those outside the single currency should be acknowledged and, more specifically, protected. In particular, it should be understood that whatever binding surveillance eurozone members might agree on, Britain will not be bound by it.
As I said earlier, the convergence programme is, by its very nature, something that harks back to the days when it was simply assumed that Britain was on a one-way route to monetary union across the EU. As the hon. Member for Luton North (Kelvin Hopkins) has suggested, hindsight is a wonderful thing, but let us not forget that, at that time, he and many Conservative Members had the foresight to see any such convergence as the wishful thinking that it was—and, to a certain extent, still is. Those Members included my right hon. Friend the Member for Richmond (Yorks) (Mr Hague), now the Foreign Secretary. As the newly elected leader of the Conservative party in 1997, he had this to say about the idea of dragging Britain into the single currency: