In conducting the negotiations, if we really want to have any chance of bringing them to a successful conclusion, it is important not to get ahead of ourselves. It is fair to say, looking at the history of the matter, that we are

26 Feb 2014 : Column 146WH

dealing with a regime that has played for time; is extremely astute; and takes a long-term strategic view on prosecuting its interests. We need to be equally hard-headed in our approach.

Therefore, while I commend my right hon. and hon. Friends, I have concerns about what is happening in other quarters. I also fear that some people are getting a little ahead of themselves. I am concerned by press reports saying that Baroness Ashton is due to visit Iran next month. I suppose that Baroness Ashton, in a way, represents us all, as the European Union’s High Representative under the Treaty of Lisbon. I certainly have concerns about that, and I wonder whether that is sending the right signal at this stage of events.

I have three particular concerns. The first concerns the signal that the visit sends to the Iranian side about what they can get out of the talks and what they have to give up in return. I am keen on the principle, which should have been enunciated by the international community, that nothing is agreed until everything is agreed. I do not see how that principle is consistent with the actions of Baroness Ashton in going to Iran, and the message that that will send all around the world about the Iranian regime and the possibility of doing trade and opening up relations with it. I am worried about the signal that is being sent.

Secondly, I am worried about the signal it sends when Iran, as has been rightly said already by my hon. Friend the Member for Hendon, is so concerned in exporting terrorism and aggression throughout the region. It has a history of doing that in many parts of the region—most of all, at the moment, in the Syrian conflict. The Iranian regime is a key linchpin of Bashar al-Assad in his efforts to fight back against the Syrian opposition. The Iranian regime is the pillar for Bashar al-Assad as he goes into action and counter-attacks the Iranian opposition. We know that during the four years of the conflict, thousands of Iranian, Lebanese and Iraqi Shi’a militiamen have been sent into Syria to help Bashar al-Assad, and Iran has been helping to send them there. There is no doubt about it. It is widely believed that the Iranian regime has been responsible for the successes that Syria has had, resulting in the conflict coming to a stalemate.

It was reported at the weekend that Iran is stepping up its support for Bashar al-Assad, providing elite teams to gather intelligence and train troops. There have been other reports that Iran has been sending specialists in with the direct intention of helping the regime to survive. Analysts believe that this renewed support has meant that Assad feels no need to make concessions at the currently deadlocked talks in Geneva, because he thinks that things are going his way with the support that he is receiving from Iran. It therefore looks slightly strange for Baroness Ashton to be going to Iran to fly the flag when talks with Iran about its nuclear position are taking place in Vienna, and in Geneva roughly the same parties are taking part in talks about Syria, which are deadlocked because of the actions of the Iranians.

I do not think we should be sending a signal about the Iranian regime either directly or indirectly through our EU High Representative Baroness Ashton—not when that terrible conflict is still taking place, when civilians are still losing their lives, and when terrible means are being employed against them. I do not believe that we should be sending that signal at this time.

26 Feb 2014 : Column 147WH

My third reason for not wanting to endorse the Iranian regime with a visit by the EU High Representative is because of the message it sends to people at home in Iran. I draw a careful distinction between the Iranian regime and the Iranian people, who are a constructive, creative people with a great culture and a great history. There is a big difference between them and their regime. I congratulate the hon. Member for Strangford (Jim Shannon) on his speech about the suppression of human rights in Iran. It is a cause that I have been particularly interested in, and I know there are grave concerns about human rights across the whole human rights piece in Iran.

Like the hon. Member for Strangford, I too have been interested in the persecution of Christians in Iran. What he said was absolutely right. People who try to change their faith or who try to promote their faith in any way in Iran are subject to terrible persecution. They are thrown into prison, their homes are raided and Bibles are confiscated. Hopes were expressed that the situation would change with the election of President Rouhani, but, for whatever reason—whether he is sending mixed messages or whether he is being undercut by conflict within the regime—there is no relaxation as far as the Christians are concerned. They are still languishing in prison for their faith, and in recent times we have heard terrible reports of four Christians being sentenced to 80 lashes for partaking of communion wine. That is since President Rouhani came to power.

I simply do not want the High Representative going to Iran to take part in discussions with the regime and endorsing it by visiting when human rights violations are taking place. We should take a much more hard-headed approach. We know that sanctions have been very effective against the regime. They have had a severe effect, and there must be concerns that a premature relaxation of sanctions would send the wrong message to the regime.

Not only is the EU High Representative Baroness Ashton getting ahead of herself, but others more widely seem to be getting ahead of themselves as well. We have seen reports of a French trade delegation of 100 leading businesses visiting Iran. Apparently, there is a German delegation in Iran this week. There are reports of a Greek delegation, led by the Greek Deputy Prime Minister, going to Iran. All that is going on when the talks have barely got going and we have no idea what the final settlement might be. One wonders what signal this sends to the Iranian side about what they need to do to get concessions in return. All the beneficial economic effects and the prosperity that flows to the regime as a result can be used by the regime, giving it more resources to support Bashar al-Assad and all the other activities taking place in the middle east.

I support hon. and right hon. Members in the course they have taken; they deserve our support. I simply ask them and everybody else—I know the hon. and right hon. Members have this in mind—to keep a tight hold on Iran and to keep in mind the objective of ensuring that it does not develop a nuclear capability. I have no doubt that Iran intends to develop such a capability. I am not remotely technically qualified to pass a judgment on how far it is on the road to acquiring one, but there can be little doubt that Iran is seeking to acquire such a capability. The rest of the international community think that. Why would Iran expose itself to sanctions if it did not have that intention in mind?

26 Feb 2014 : Column 148WH

3.17 pm

Sitting suspended for a Division in the House.

3.29 pm

On resuming

Hywel Williams (in the Chair): Mr Clappison, had you finished your remarks?

Mr Clappison: As long as it is shown that I was saying that we must make every effort and use every endeavour to prevent Iran from acquiring nuclear weapons, I will conclude.

3.30 pm

Mr Ben Wallace (Wyre and Preston North) (Con): I congratulate my hon. Friend the Member for Hendon (Dr Offord) on securing this debate. Iran is a topic that often needs a good airing. At this critical time, it is important that we give strong scrutiny to the Geneva accord agreed at the end of last year.

First, may I declare my entry in the Register of Members’ Financial Interests? I am chairman of the all-party group on Iran and have been for the past eight years. I have twice visited Iran—including recently, three or four weeks ago. I have also visited on a number of occasions the International Atomic Energy Agency in Vienna at the United Nations.

We always have to go back to the beginning on Iran. We have to remember that the nuclear programme for Iran did not start last Tuesday or last year; in fact, it started in the mid-1960s, when the Shah was in charge—funded by the United States, ironically. General Electric came to its aid, to develop the first reactor in the heart of Tehran. Iran has had nuclear ambitions, whether civil or military, for decades. They have been part of its psyche. It lives in a rough neighbourhood; it has rivalries that we can, perhaps, only understand as having similar aspects to those in the cold war and with the Soviet Union; and it is surrounded by ethnically and religiously different economic and military rivals. That has often driven some of its insecurities.

The history of the nuclear programme is long and sporadic and it has jumped, depending on which country has helped Iran. The Russians helped it build a reactor in the past, the United States has done so and I suspect that the North Koreans have, too. Certainly, other members of the international community have stuck their oars in. That is why there is a rather illogical, sporadic and often bizarre civil nuclear programme.

Iran is not the only country in that region to have a civil nuclear programme. The United Arab Emirates is developing one right now, as we speak. Many middle east countries have sought to acquire nuclear technology. The most striking examples are India and Pakistan, which developed in total secrecy a nuclear weapons programme that ended up in actual nuclear weapons. We in the west either chose not to know or did not seem to know.

The process goes on. It is not new. It has, unfortunately, become entwined with the Iranian psyche and its view of itself in the world. However, let us remember that middle east politics is often as much about rhetoric as about action. Throughout the 1980s, for example, at the height of Ayatollah Khomeini’s rhetoric against the

26 Feb 2014 : Column 149WH

country of Israel, Israel sold Iran nearly half a billion dollars’ worth of arms. In fact, Israel broke the UN sanctions on arms embargo to Iran and Iraq in that period. It suited Israel at that stage to ignore the rhetoric and to side with Iran against Iraq, while the west was unfortunately supporting Iraq, by supplying it with some pretty dubious methods.

We have to go forward. In 2001, Iran helped the west bring down the Taliban. We might remember the Lion of Panjshir, Ahmad Shah Massoud, who was the west’s favoured leader of the Northern Alliance—the man who was going to liberate Afghanistan on our behalf. The irony was that he was Iran’s man in Afghanistan. The Northern Alliance helped America and Britain in their targeting and intelligence gathering against the Taliban.

Throughout these processes, Iran has stepped forward, sometimes against its nature, but sometimes for its own self-interest, and it has often been rewarded by immediate rejection. The “axis of evil” phrase was used discended on Iran, despite its assistance to the British and Americans in getting rid of the Taliban.

Trust is the problem in much of this, whether in respect of the nuclear programme, human rights or exporting terrorism. The Iranians’ knowledge of Britain’s poor behaviour towards it in the last centuries is better than mine. The Iranians understand that we supported the constitutional revolution in 1906 and then undermined it, when we removed the democratic constitutional revolution, to put in a Shah, and then we moved that Shah when he became too friendly with the Nazis. Then we moved their Prime Minister in the ’50s and put in another Shah. They understand that we—the United Kingdom—play power games and that we are not to be trusted, in the same way that we, quite rightly, have every reason not to trust Iran in the near future.

We have not trusted Iran on its nuclear programme. It has hidden things and has certainly done its best. There is proof that, in 2003 and 2002, it acquired from the AQ Khan network—not funded by Iran, but by one of its regional rivals—military plans for a weapons programme.

Trust is failing on both sides. That has been the real issue. I do not argue with my hon. Friend the Member for Hendon that, really, at the heart of the Geneva accord, the issue is about trying to fix this trust and to see what steps we can take to build together. We will have to stick our neck out to build that trust. That is the problem. I understand; if I was living in Israel right now, I would be worried about that. It is not me under direct threat from Iran. In fact, British national interests and British security are not threatened by Shi’a Islam, but by Salafist Sunnis emanating from al-Qaeda. They are the people who will blow up our trains and tube stations. That is nothing to do with Iran; that is to do with other major players in the region, who are either tacit or have yet to deal with that problem.

If I was in Israel, of course I would be worried and rightly so. But I also recognise that, within Israel, there is a split about the extent to which the Iranians are rational or irrational and how much Iran really wants to do nuclear damage or blow up Israel. Meir Dagan, the ex-head of Mossad—not a boy scout organisation—said on the record that Iran is rational and that he does not think it intends to go to that next step.

Nevertheless, the situation is real and we should look at the facts and the evidence as they are presented. The first things that I look at are the national intelligence

26 Feb 2014 : Column 150WH

estimates of the United States, the first of which, in 2007, was made under George Bush. The estimates are put together by the National Security Council, the CIA and the Pentagon. President Bush was not known as a dove on any areas in the middle east, but the national intelligence estimate produced at the time said, “We do not believe—we believe they did previously—that they are now on the verge of a break-out”. That is an important document. It was dismissed at the time by the hawks, but in 2012, under President Obama, another one appeared that effectively reaffirmed that national intelligence estimate.

Dr Offord: I appreciate my hon. Friend’s counter-view on some of these issues. It is easy to talk about organisations presenting reports. I have found the 2012 Institute for Science and International Security report, containing information from former weapons inspectors, who disagreed with Binyamin Netanyahu at the UN General Assembly in 2012 and felt that Iran would have a nuclear capability within months. It is okay to say that certain organisations say that is not possible. Equally, it is valid to say that other organisations contradict that point of view.

Mr Wallace: I register the point, but these are not national institutes. This is the CIA and the Pentagon—okay, they do not have the best track record on intelligence, but they never gave the benefit of the doubt to the doves; they always gave it to the hawks. These are major national institutions—Government organisations—that share intelligence with Israel and all the other allies that we have, so they are certainly serious. It is important to look at that fact.

We should not pass over the grand bargain offered by Iran in 2003. The grand bargain was something that every hon. Member in this Chamber would have signed up to tomorrow. It was an offer by Iran to suspend enrichment; to join the additional protocol, with further and more intrusive inspection than even Britain has under the non-proliferation treaty; and to demilitarise Hezbollah. It was even to have gone as far as to recognise Israel, which many countries in the middle east, which may be against Iran but are not necessarily allies, still do not recognise. They may help Israel, but they still have not taken the next step. That grand bargain was rejected out of hand by the White House.

People sitting now in Iran would say, “Hang on, we offered all this and this was all thrown away”. That goes back to the heart of the matter. The trail of trust has been full of missed opportunities on both sides. We really need to try to rebuild it. I commend this Government, the Obama Administration and the P5 plus 1 for sticking their necks out.

I do not mind who visits Iran. I have been to Iran, but I do not approve of what the Iranians do to Christians, Baha’is or other minorities. I condemn that absolutely, but I believe that visiting Iran does not mean supporting Iran. If people criticise or propose policy against a country, it is a good idea for them to take time to visit that country. That is important. I do not sit around and get involved in debates on Israel because I have not been there. One day I might decide to do so, mainly because it affects other middle east policy that I might want to discuss. Going there is important.

Jim Shannon: I accept the hon. Gentleman’s logic. I might be reading it wrong, but is he saying that we need to go to a country to appreciate and understand it fully?

26 Feb 2014 : Column 151WH

I have never been to Israel, but I would say that I have a full appreciation and understanding of Israel and of how it feels threatened by many countries across the world. I have no less knowledge of Israel because I have not been there. Not going there does not lessen my enthusiasm for the state, which I feel is threatened. Does he accept that?

Mr Wallace: I accept that, but I would not support the hon. Gentleman if he criticised people who have visited Israel to find out. I do not think that can be a point of criticism. He is from Ulster, where I have spent a lot of time. In fact, I have sat down with members of the IRA. That does not mean per se that I supported the IRA when we were trying to negotiate a peace deal. People increase their knowledge by going somewhere and understanding it. They do not become a world expert, but they increase their knowledge. When we speak to normal Iranians or see at first hand the split between the Iranian Government, the different Ministries and the different politicians, we understand a bit more. We do not become an expert or an Iranian any more than we would become an Israeli if we went to Israel.

Guy Opperman (Hexham) (Con): I apologise for not being present for the speech of my hon. Friend the Member for Hendon (Dr Offord), whom I congratulate on securing this debate. I am grateful to my hon. Friend the Member for Wyre and Preston North (Mr Wallace) for allowing me to intervene. I support the thrust of what he says. I have visited Israel with Conservative Friends of Israel, and going there benefits those who go. Any situation that establishes better relations between the west and Iran has to be the way forward if we are to have long-lasting peace in the middle east.

Mr Wallace: I totally agree. It is important that we understand that there is a prize to be had: stability, a resolution to the nuclear threat—if there is a nuclear threat—and a chance to build new alliances in the middle east. We cannot avoid the issues in Saudi Arabia, which seem to be ignored.

The hon. Member for Strangford (Jim Shannon) mentioned apostasy and the persecution of Christians. There are not many Muslim countries in the world that allow Christians to proselytise. Try taking a Bible to Saudi Arabia; Bibles can be taken to Iran. People might not be able to proselytise in Iran, but try going to a church in Saudi Arabia any time soon. We have to realise that there are opportunities.

I will finish so that there is time for the Minister and others. A battle is still going on in Iran between hard-liners and reformers. The reformers are trying to say to the population, “Look, Iran can be successful, but we need to concede certain things. We need to slow the nuclear programme”—or cancel it if there is a military aspect—“and we need to come into the international community. We will address human rights, too.” I met the President’s chief of staff, and I directly pressed him on the Baha’is. Iran needs to show that willingness.

The hard-liners and principlists like isolation and sanctions. The revolutionary guard profits from sanctions, because sanction-busting is very profitable. We have to say, “Here is a chance.” As of today, the Iranians are

26 Feb 2014 : Column 152WH

complying with their Geneva accord obligations. They are reducing the stocks of 20%-enriched uranium. Before the Geneva accord, the Iranians were diverting such uranium to fuel plates. Iran is starting that process, and it is increasing the number of inspections.

We need to judge Iran, day by day and week by week, on where it is going, but please remember that, if we decide to shut out that effort, we will bring in the hard- liners of Iran, who will not be interested in rapprochement or the international community and who will take refuge in a religious extremism that will not help the Iranian people, peace in the region or the countries of Britain and Israel.

Several hon. Members rose

Hywel Williams (in the Chair): Order. The debate will conclude no later than 4.14 pm.

3.44 pm

Mr Gareth Thomas (Harrow West) (Lab/Co-op): It is a pleasure to serve under your chairmanship, Mr Williams. I congratulate the hon. Member for Hendon (Dr Offord), my north London near neighbour, on securing the debate, which has been a useful opportunity to assess recent events in Iran including, among other important issues, the joint plan of action. He rightly said that the joint plan of action does not resolve international suspicions about Iran’s intentions and merely suspends some of those suspicions for some people. He is right to continue to be concerned about Iran’s sponsorship of terrorism and other harmful activity in the region. He, along with the hon. Member for Hertsmere (Mr Clappison), rightly underlines that the sense of threat from Iran is still felt particularly acutely in Israel.

As in previous debates on Iran, we have had a good range of contributions from hon. Members offering differing but strongly held views. The speech of the hon. Member for Wyre and Preston North (Mr Wallace) was interesting in highlighting some of the history of the relationship between the west and Iran. He noted some of the complexities and the need for nuance in our debates on future relations with Iran.

Such a range of views and the need for nuance is perhaps reflected in the region itself. I am struck that there is clearly an intense debate on the joint plan of action in Israel. In that context, it is worth noting the comments made yesterday by the Israeli Labour party leader Isaac Herzog, who challenged some of the comments by Israel’s Prime Minister, Mr Netanyahu, on the Iranian nuclear deal:

“This is an interim agreement; it isn’t Judgement Day…yet.”

He suggested in a slightly more partisan tone that Mr Netanyahu was encouraging a sense of panic on the joint plan of action that is not necessarily helpful.

The hon. Member for Hendon, in response to an intervention, alluded to Iran’s role in Syria and elsewhere in the region. Perhaps inevitably, it is always a critical time in the middle east, but it feels particularly so at the moment. Iran clearly plays an important role, and its activities in the region have implications for the wider relationship between Iran and the west. The international community, including the UK Government, must continue to do all it can to encourage all the parties in Syria to end the fighting and, in that context, to persuade Iran to influence the Assad regime at every opportunity to cease the use of violence against its own people.

26 Feb 2014 : Column 153WH

Similarly, Iran’s dismal human rights record has rightly been raised by a couple of hon. Members. There are serious ongoing concerns. If the new regime in Iran takes steps to improve the country’s human rights record, it would send a strong signal on the importance that the Iranian Government attach to co-operation and engagement with the international community. Although President Rouhani has not openly expressed anti-gay rhetoric, unlike his predecessor, Iran’s Islamic penal code still lists homosexuality as an offence punishable by death.

The hon. Member for Strangford (Jim Shannon) rightly highlighted concerns about the attitude to other religions and ethnic minorities. It is far from clear, according to Iran’s Nobel laureate Shirin Ebadi, that political prisoners are being released in the way that the regime has previously claimed.

There has long been recognition in the House and across the international community that we need to grasp the serious opportunities that occasionally come along—they are certainly presenting themselves to us now—to improve relations between Iran and the UK and the west in general. The hon. Member for Wyre and Preston North highlighted a number of the missed opportunities to do just that. President Rouhani is offering the prospect of seriously improving the relationship between the UK and Iran. In recent months, his Administration’s new approach to negotiations suggests that we should be open to continuing serious engagement with his regime. I pay tribute to the EU’s High Representative, Cathy Ashton, not only for her role in the negotiations but for her willingness to continue to follow through on the prospects for better engagement.

On ensuring that Iran’s nuclear programme is and remains peaceful, Members will be aware that the first step agreement with Iran commenced on 20 January and continues to be implemented. We are between talks and the E3 plus 3 are meeting again in March for the next round. We should be encouraged that the previous talks were of a constructive nature.

The hon. Member for Hendon rightly raised concerns about Iran’s attitude to, for example, the critical issue of centrifuges. There has been concern that Iran has installed new centrifuges. As the shadow Foreign Secretary expressed in his response to the Foreign Secretary’s statement on Monday, there is concern that Iran is still operating more than 10,000 centrifuges when the interim deal set out a much lower target. What is the Minister’s view on that? There has also been concern about the Arak heavy water research centre. As he has previously said, under the joint plan of action Iran is supposed to fully resolve concerns about that reactor and confirm that no reprocessing will take place there. What is his view on progress in that area?

The deal that has been agreed is a necessary step precisely because Iran has developed an enrichment programme over recent years, despite calls by the international community to stop. That is why the existing substantial sanctions must be enforced and why the comprehensive solution must address all the proliferation concerns on Iran’s nuclear programme. Does the Minister believe that the IAEA has the necessary resources to be responsible for the verification of the nuclear-related measures to which Iran has committed? Will he explain more about the monitoring and validating processes that the IAEA will go through? Maintaining confidence in those processes will be important in helping address

26 Feb 2014 : Column 154WH

the suspicion about the Iranians’ activities. In that way, the necessary trust can be built to achieve the comprehensive solution that will ultimately be in everyone’s interest.

Will the Minister set out what the role of the joint commission of the E3 plus 3 and Iran will be? What stage are we at in the development of the joint commission? Will he set out, as the shadow Foreign Secretary asked the Foreign Secretary to do on Monday, the impact that the sanctions relief has had so far on the Iranian economy? Will the Minister set out the most recent estimate of the benefits that the limited sanctions relief has so far brought to the Iranian economy? Similarly, what impact has the limited sanctions relief had on Iran’s petrochemical exports and the imports of goods and services for its automotive manufacturing sector?

Finally, on a related but nevertheless separate issue, the UK and Iran brought protecting power arrangements to an end last week, which is an encouraging sign of increasing confidence that bilateral business can be conducted directly between capitals, rather than through intermediaries. Iran’s non-resident chargé d’affaires visited the UK this week. Can the Minister provide at least some update on the progress in those discussions? All of us wish the Government and the E3 plus 3 well in seeking to deliver on the comprehensive solution. I hope the Minister will continue to provide regular updates to the House to offer assurance on the progress of negotiations.

3.55 pm

The Minister of State, Foreign and Commonwealth Office (Hugh Robertson): I congratulate my hon. Friend the Member for Hendon (Dr Offord) on securing the debate and thank all hon. Members for their contributions. Given that this has been something of a question fest, I suspect that my best approach in summing up is not to read through the beautifully drafted piece of English that has been supplied to me, but to try to pick out the questions that have been asked and to go through them as swiftly as I can in the 10 minutes remaining.

In a sense, the debate has highlighted the issue. It would be a bit simplistic to call it a glass-half-full, glass-half-empty debate, but in a sense everyone is occupying the same piece of ground. My hon. Friend the Member for Wyre and Preston North (Mr Wallace) gave us a wonderful historical tour de force of relations with Iran. There are ample reasons to be extremely cautious and very suspicious. On the other hand, once every so often an opportunity comes around. The question is whether to make that leap of faith and test it, being well aware of all the past problems, the history and the dangers, in the hope of getting to a better place eventually. Alternatively, we can be extremely cautious at every stage to the extent that it impacts on the ability to conclude that final deal. Those are difficult and complex judgments, and there are no right or wrong answers.

The last time the international community had a go at this was when the right hon. Member for Blackburn (Mr Straw) was Foreign Secretary. It got to a stage where all the suspicions present in today’s debate were aired, and a combination of the hard-liners in Tehran and Washington derailed the deal. The consequence of that was that the steps towards nuclear production simply continued. Arguably, as a result of not being able to take those bold steps, the situation got worse,

26 Feb 2014 : Column 155WH

not better—I know it is difficult to second-guess these things now. It is absolutely right to be cautious and sensible and to have an eye to history, but we should see on this occasion whether we can test the feelings and sentiment in Iran.

I will try to answer the various questions that my hon. Friend the Member for Hendon asked. He is absolutely correct to say that the interim agreement does not resolve international suspicions. As he will have guessed from my opening remarks, I absolutely agree that it does not. It is merely a first step that buys us the time to move towards further discussions on the issues, of which he raised a great many. A comprehensive agreement will absolutely need to address the proliferation concerns that he set out. Let me be clear: we will not sign a deal if it does not address those concerns. Secondly, he made the point that, through the sanctions relief regime, we have eased the pressure on Iran’s economy for very limited concessions in return.

It is worth saying that the interim deal addresses some of the nuclear programme’s most concerning elements: the eradication of the stockpile of 20% enriched uranium; and Iran being forbidden from installing further centrifuges, which is different from developing them. It also eases the monitoring regime carried out by the IAEA. We and the US estimate the sanctions relief given to Iran to be about $7 billion over the six-month period. That is a relatively small fraction of the $60 billion to $100 billion of restricted Iranian oil funds held abroad and of the $60 billion to $70 billion it needs to finance its foreign imports. I understand my hon. Friend’s concerns, but there is a sense of proportion in that.

My hon. Friend asked about what are called in the parlance the PMDs—possible military dimensions—of Iran’s nuclear programme. That is very much a concern. He is right to say that they are not addressed in the interim agreement, but they are a key part of the final negotiations that will take place so they will be addressed. Indeed, the joint plan of action makes it clear that the joint commission, composed of the E3 plus 3 and Iran, will work with the IAEA to facilitate the resolution of all those issues.

Fourthly—if I have got the order right—my hon. Friend asked about the sanctions relief enabling the Iranians to fund terrorism, which touches on a point made by several other Members. There is no doubt that Iran’s support of terrorism throughout the region is a malignant force. As my hon. Friend the Member for Hertsmere (Mr Clappison) mentioned, were there need for evidence, considerable evidence is available—it is a statement of fact—that Iranian support for Hezbollah and directly through the Quds Force has played a considerable part in the conflict in Syria. That is not the only example by any means of Iran’s malign influence in the area; it has been seen recently in Bahrain, Saudi Arabia and right around the Arabian peninsula. That will have to be addressed if relations with Iran are to be normalised in any meaningful way.

I guess that the question about the granting of access to the IAEA was driven by the Parchin military facility issue. My hon. Friend the Member for Hendon is right that the interim agreement does not allow the IAEA access to Parchin. However, following Iran’s agreement with the IAEA on 8 February about the exploding

26 Feb 2014 : Column 156WH

bridgewire detonators, we hope that we can make progress. Indeed, that will have to be addressed as part of any final and comprehensive agreement.

My hon. Friend asked, perfectly reasonably, about our assessment of whether the Iranian actions at the moment are within the spirit of the JPA agreement. The hon. Member for Harrow West (Mr Thomas) asked in particular about the continued production of advanced centrifuges with reduced break-out times and whether that poses questions about Iranian intentions. There is no doubt that we would much rather that Iran had not done that. The IAEA, however, has looked at what it has done thus far and confirmed that it is currently complying with the JPA’s strict terms. As part of the 24 November agreement, Iran has committed not to install or bring into operation any new centrifuges in the main enrichment facilities.

That, however, does not help with confidence-building measures and, as we touched on earlier, there will be a real trust issue if the Iranian Government continue to act in this way. Again, that will have to be addressed as part of the comprehensive agreement.

Finally, my hon. Friend asked about the concerns that Iran could simply pocket the benefits and walk away from the negotiations. Indeed it could, but, if so, it has a great deal to lose. The Iranian economy is going through the floor and there is real hardship in Tehran. Anyone who looks at this—intelligence agency or otherwise —realises that the Iranian economy is in a very bad place indeed, and the key electoral promise of the Government was to restore the economy, so they have a considerable incentive. Without such an agreement, they can do absolutely nothing to bump-start their economy.

If the deal falls to pieces, no doubt international reaction will be tough and Iran will wear the blame for that. The full sanctions regime will simply be reinstated and it will move backwards very quickly. In an environment in which Iran had toyed with the international community and let it down, it would be difficult to restart talks for some time. My hon. Friend is right that, in theory, Iran could pocket what it has got at the moment and walk away, but that might not be wise on its part. There is no intention whatever to offer further sanctions relief over and above what it has got until it has delivered on the key terms of the agreement.

Let me turn to some of the other questions asked in various contributions. It is always a pleasure to hear from the hon. Member for Strangford (Jim Shannon). He talked about the power struggle in Iran and he is absolutely right. At the moment, the indication is that the supreme leader backs the regime in the talks being conducted: indeed, the substantive concessions made thus far would not have been possible without his support. However, as we all know, hard-liners who do not wish the process well are operating in the background. The hon. Gentleman asked a good question about whether Rouhani can deliver. Our assessment is that he can, but if we push him too hard, it probably will not take a great deal for that to change. If he cannot show real benefit from the process, that assessment must be called into doubt.

The hon. Gentleman asked about human rights abuses in the country and he is right to highlight them. I have the figures here and the situation is appalling—there are no two ways about it. There have been reports of at least 400 executions in 2013. Iran has the second highest

26 Feb 2014 : Column 157WH

number of journalists in prison in the world. Opposition leaders have been detained for more than two years. Arrests of human rights defenders and journalists continue, as does persecution of religious and ethnic minorities. The Government will continue to hold Iran to account. We are not being soft: more than 80 EU sanctions are designated on individual Iranians and entities responsible for human rights violations.

Mr Clappison: May I say how grateful I am to the Minister for his personal interest in and attention to the issue of persecution of Christians in Iran? He deserves tribute for his stand.

Hugh Robertson: I thank my hon. Friend. He is very kind. One of the curious things about my job is that I end up handling the majority of the correspondence that flows into the Foreign Office. In my first few months, it was noticeable that one of the subjects raised most regularly by Members throughout the House was the fate of Christians in the middle east. In the various visits I have made around the region, I have tried to make a specific point of seeking out Christian leaders to talk to them about what is happening. I had a fascinating couple of hours with the Copts in Egypt—there are between 10 million and 12 million of them—and I will continue to take a close interest as I make my various visits.

To finish my response to the hon. Member for Strangford, he is right that religious freedom is a key part of where Iran needs to get to. That is something that is largely lacking under the current regime.

Jim Shannon: I entirely agree with the comments made by the hon. Member for Hertsmere (Mr Clappison) about the Minister’s dedication and interest, which I appreciate as well. In my speech, I mentioned that Rouhani had indicated through Twitter his best wishes for Christians at Christmas time and at times of festival. That is an indication of a leader providing leadership. Has the Minister had any chance of gentle discussion with Rouhani and his Government?

Hugh Robertson: The honest answer is no. Contact at ministerial level with the Iranian regime has been restricted to the Prime Minister and the Foreign Secretary. I think it is appropriate to keep it at that level rather than open the door. There are all sorts of reasons—I was just about to come on to this matter—why we might proceed with some caution, so I have not had those conversations.

My hon. Friend the Member for Hertsmere made the very good point that it is important not to get ahead of ourselves. I agree absolutely. The Foreign Secretary put it well in the early autumn of last year when he came back from New York. He explained that there had been a change in the atmospherics, but that nothing substantive on the ground has changed at all. That is a good way of putting it and a good way of approaching what we are doing at the moment. There is a clear opportunity but it makes abundant good sense to move forward with

26 Feb 2014 : Column 158WH

caution, acting sensibly and testing the intentions. There is a great prize at the end if we can get there, but we should proceed with caution.

My hon. Friend correctly drew our attention to the lack of progress in Geneva. I sat through the whole of the first day of contributions there, and our assessment was that the key driver behind that lack of progress was the regime’s unwillingness to address the question of regime change. It is a red line that the regime will not cross, and at the moment it is the great barrier. The regime wants to talk only about terrorism, whereas the opposition wants to talk about transitional arrangements. Breaking that deadlock is proving extremely difficult.

I congratulate my hon. Friend the Member for Wyre and Preston North. As chair of the all-party group on Iran he is the resident House expert on these matters, and is certainly the only person here today who has been to Tehran recently. He speaks with great knowledge. He is absolutely right to observe that trust has failed on both sides and that there is a battle between the reformers and the hard-liners. I thank him for acknowledging the benefits of the joint plan of action.

The Opposition spokesman asked about the thousands of centrifuges that have been produced, so I will give him chapter and verse on that. He is absolutely right that the regime has produced a series of centrifuges. As part of the agreement the regime is not allowed to install new centrifuges. The IAEA knows the centrifuges are there and is monitoring what happens to them. I hope that matter is in hand.

The hon. Gentleman also asked about Arak. The interim deal has halted construction there and suspended fuel production for the heavy water facility but the final status of that plant is a matter for the final status negotiations and so is not yet resolved.

The hon. Gentleman asked about resources of the IAEA. Off the top of my head, I do not know exactly how many people it has on the case on the team of inspectors, and I am not sure that that information would be readily available, for obvious reasons. However, if it gives him reassurance, I have been working closely on this matter for the past three or four months and at no stage have I heard a suggestion that the IAEA is short of resources or is unable to conduct the monitoring it wants to carry out.

The hon. Gentleman asked about the impact of sanctions relief on the Iranian economy, and I have already given some relevant figures. I do not know what impact sanctions relief has had on the automotive sector, but we will send him a written reply on that matter.

The hon. Gentleman asked about the visit of the Iranian chargé, who was just here, from 18 to 25 February. That was his second visit to the UK, and there have been two visits in the opposite direction. When we have the Iranian assessment of what he has achieved and what the issues are, there will be a process in which we will sit down and work out what happens next. The Foreign Secretary has been scrupulous in making a statement to the House every month or six weeks and that is his intention should there be any additional information on that matter.

26 Feb 2014 : Column 159WH

Broadband (South Northamptonshire)

4.14 pm

Andrea Leadsom (South Northamptonshire) (Con): It is a pleasure to serve under your chairmanship, Mr Williams.

Good broadband coverage is not just important for those of us who want to download films and TV shows, do internet shopping or keep up to date with the latest news; it is truly vital for those who work from home and those who run their own businesses. Broadband is a superb investment, which is projected to boost local growth across the country, with a net return of £20 for every £1 spent by 2024.

Often, however, the emphasis is on getting good coverage for towns and cities. I want to make the case that good broadband coverage in rural areas is every bit as important. My constituency, South Northamptonshire, covers 92 parishes—many of them rural—two market towns and a decent chunk of Northampton, our county town. In 2012, Northamptonshire county council undertook an open market review to determine the level of broadband coverage in the district of South Northamptonshire. The council surveyed over 38,000 premises in the district; of those, it discovered that 27,000 were identified as unserved. In 2012, then, about 70% of all premises in the district of South Northamptonshire had no broadband coverage at all.

Overall, I am delighted with the steps that both the Government and Northamptonshire county council are taking. The Government are already investing £1.2 billion to supply people across the UK with access to superfast broadband. The target set is for 95% of the UK to have access to superfast broadband coverage by 2017. The Government have acknowledged the importance of good broadband infrastructure in creating more jobs and ensuring small businesses have they support they need. I am encouraged that 10,000 homes and businesses are getting superfast upgrades each week, with that figure set to rise to 40,000 premises a week by the summer. Finally, I was delighted by the announcement, made only yesterday by my right hon. Friend the Secretary of State for Culture, Media and Sport, of the allocation of an extra £250 million to ensure that all areas of the UK are able to hit the 2017 target. I certainly welcome the £3.64 million additional allocation for Northamptonshire.

The backing is there. Closer to home, I am glad that Northamptonshire county council has its own excellent plans for roll-out to deliver 90% coverage in the county by 2015. Over 50,000 premises will gain access as a result of the just over £4 million allocated by the county council, together with over £4 million from Broadband Delivery UK and an investment of £3.2 million from BT. The council reports that it now intends to go further than its initial 2015 target and is already talking to commercial providers to revisit the extent of commercial plans. The council has put aside an extra £2 million, and I am sure it will welcome the additional sum of just over £3.5 million allocated yesterday by the Secretary of State.

Northamptonshire county council has one of the most detailed “when and where” maps in the country. Although residents are aware that plans could change, that map provides the best information available on the extent of coverage, by when the coverage will be in place

26 Feb 2014 : Column 160WH

and how the council expects plans to come forward. Of the 27,000 properties in my constituency that were identified as unserved, the council expects that 18,500 will receive access to superfast broadband through its investment, and that of BDUK and BT. The Superfast Northamptonshire project will see another 4,175 premises in South Northamptonshire receive coverage. It is the council’s aim to secure full superfast coverage by the end of 2017.

For all that good news, full access is still a terribly long way off. I regularly receive reports from annoyed and frustrated residents in my constituency who are struggling to gain decent access, or any access at all, to broadband services. Although Northamptonshire county council has a clear and ambitious plan, it is held hostage slightly by private companies that may or may not stick to the commitments they have made.

Broadband should rightly be the domain of the private sector, so there are clear rules about how and where the public sector can intervene, but Grange Park in my constituency is a good example of an area where broadband is a major issue. The majority of the area falls within the commercial plans of BT’s provision. As it has declared a commercial interest, the county council cannot intervene with a solution as that would be in breach of state aid regulations. The county council, parish council and Grange Park residents are pressing BT to deliver on its commercial proposals and to set out a clear timetable. I understand that there will soon be a meeting with BT’s regional director for the east midlands, and I hope that they will be able to move things forward.

The problem in Grange Park is that it is a significant distance from the exchange and around a quarter of properties are served by telephony over passive optical networks—T-PON—which will not support superfast fibre-based services. A solution must be found, but it may not be simple and may be expensive. Residents believe that BT has an obligation, and that it must not step back from its proposed commercial response and transfer the problem back to the county council. A delay in securing good broadband coverage to the area and finding the additional funding, which would be needed if the problem were given back to the council, would be unacceptable.

One resident wrote to me recently explaining the issue. He fears that BT will conclude that it is not commercially viable to change T-PON to fibre to the cabinet—FTTC—which is the infrastructure that is so desperately needed. My constituent concludes that the problem is the lack of competition as BT is the only commercial provider. If Virgin, for example, had existing infrastructure in Grange Park, BT would be fighting to retain business instead of receiving the same revenue for line rental and current broadband services without having to provide any investment.

My constituent also explained that many residents have their own businesses and work from home, and that the problem is so serious for many that they may have no alternative other than to move away if it really will be 2017 or beyond before the problem is resolved. I hope that the Minister will assure my constituents that commercial companies will be strongly encouraged by any means possible to stick to their commitments.

I appreciate that BT is providing broadband speeds of up to 80 megabytes in Brackley, benefiting more than 6,500 properties, and a higher speed copper broadband

26 Feb 2014 : Column 161WH

speed of up to 20 megabytes, benefiting Middleton Cheney and Roade, to name just a couple of villages. By the end of 2014, its current plans will benefit communities in Paulerspury, Blisworth, Pattishall, Silverstone, Blakesley, Chipping Warden, Cogenhoe, Hackleton, Sulgrave and Yardley Hastings. That is great news and hugely welcomed, but it is of no comfort to my constituents in Grange Park, and I urge private providers to ensure they carry out their proposed investment plans.

Towcester is one of the largest market towns in my constituency, but until a couple of weeks ago, constituents were explaining to me that if they were lucky they could receive a connection speed of about 3.5 megabytes, and for some it was no more than 1 megabyte. I am pleased that because of county council investment, 10 new fibre cabinets went live on 3 February. I am delighted that the Minister was able to attend the celebration, and I hope that residents will soon experience the benefits. However, Towcester residents are still having problems with mobile phone signals, and if the Minister has five minutes to sort that out, they would be incredibly grateful.

I want to finish by mentioning the Tove valley community broadband project, which is a fantastic example of a community taking matters into its own hands. Last year, the community-based initiative celebrated its 10th anniversary of bringing an internet service to the Tove valley. Volunteers of the Abthorpe broadband association, led by Eric Malcomson, initially brought a satellite-based service to Abthorpe and later an ADSL system, but the villages now have a broadband service offering speeds of up to 30 megabytes, well above the national average, and an average of 20 megabytes even at the furthest reaches.

In the target area, 50% of households have signed up to the superfast service, well above the critical mass required to make the project financially viable. More than 225 of the 450 households have asked for the service and 208 are already connected. That was completed in less than six months since the service started in May 2013.

The communities of Abthorpe, Astwell, Bradden, Foscote, Lois Weedon, Slapton, Wappenham and Weston have benefited. I am delighted to be a resident of Slapton, so I am a beneficiary. Those connections have been completed and coverage is being extended to Helmdon. All the villages are delighted with the opportunities that connection provides, and what has been done there should be a model for future broadband initiatives in rural areas. It was an honour to be asked to open the project in Abthorpe in June 2013.

I was delighted to attend the 2013 TalkTalk digital heroes awards at the end of 2013 when Eric Malcomson, chairman of the Abthorpe broadband association, won the east midlands regional award. The award celebrates people who use digital technology to help their local communities, and Eric has worked tirelessly to deliver a fantastic service to a very rural area. I cannot overstate how beneficial the service had been to many communities. Tove valley community broadband project achieved a finalist’s position in the fixed rural networks category at the 2013 NextGen awards.

In conclusion, I congratulate the Government on the work and investment to ensure that even those in the hardest-to-reach places can access good broadband services. I also commend my own county council for its ambitious targets, and for recognising how important broadband is to rural areas. I am conscious that this must not be an attack on private providers. The investment that private

26 Feb 2014 : Column 162WH

commercial companies are providing is vital. However, I urge that that investment should continue and I hope that private companies will work with local councils to agree solutions and suitable timescales to deliver better services to areas such as Grange Park.

I would be grateful if the Minister explained what steps his Department can take to ensure that private companies cannot hold councils to ransom at the expense of good broadband coverage for communities in desperate need of it.

4.26 pm

The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr Edward Vaizey): I am pleased to be speaking under your chairmanship, Mr Williams. I congratulate my hon. Friend the Member for South Northamptonshire (Andrea Leadsom) on securing this important debate. She is an assiduous champion of her constituents and their interests, and it does not surprise me that she seeks to draw my attention to the importance of broadband to her constituents.

Before responding to the specific issues that my hon. Friend raised, I will give a brief overview of the broadband project as it is developing. Having commissioned research, the Government know that investment in broadband pays enormous dividends in economic growth. A recent study that we commissioned showed that over the next decade every pound invested in broadband will deliver a £20 return investment. That sounds an unusually high return, but it is realistic because broadband is a general-purpose technology, which has an increasingly critical role in the day-to-day running of businesses large and small.

The bulk of that economic impact will come from improvements in business productivity and will safeguard employment in areas that might otherwise be at a disadvantage. There will be a time saving for people who will no longer have to commute, and opportunities for people to participate in the work force. The gross value added attributable to our current programme is about £6.3 billion a year by 2024, with about 20,000 jobs attributable to the programme. I have been told that increased teleworking will save around 10 million hours of leisure time every year, as well as reducing commuting costs.

We invested some £500 million in our original programme to bring superfast broadband to areas where it was not commercially viable, and that money was matched by local authorities. The total sum was around £1.2 billion. As my hon. Friend said, the Government gave Northamptonshire some £4 million, which was matched by the county council and topped up by the telecoms provider BT.

The programme in Northamptonshire, before we announced our superfast extension programme, was designed to achieve 89.2% fibre coverage, which meant that 87.4% of all premises in Northamptonshire county council’s area would receive speeds of 24 megabits and above. Some 228,000 premises in the Northamptonshire county council area will be covered by BT commercially and almost 50,000 premises—48,600-odd to be exact—will be covered by the intervention of the Government and the county council. As my hon. Friend pointed out, 18,500 premises in her constituency will benefit from the programme.

26 Feb 2014 : Column 163WH

I am pleased to say that, according to my understanding, the programme in Northamptonshire is now two months ahead of schedule. It may or may not have escaped your notice, Mr Williams, that the Government were criticised some months back for the programme’s being delayed. In fact, the more one sees the programme getting under way, the more one sees that it is now beginning to exceed its targets. In my hon. Friend’s constituency, we have so far reached 3,300 premises through the scheme and we should have covered another 2,000 premises by the end of March.

The programme is very successful, not only in Northamptonshire, including South Northamptonshire, but across the country. We are covering more than 10,000 premises a week. We hope to get to a milestone of half a million premises reached some time towards the approach of summer. We hope then to be covering some 40,000 premises a week.

Let me echo the tribute paid by my hon. Friend to her county council—Northamptonshire county council. From the very beginning of the project, we wanted to partner with local councils and Northamptonshire county council has stood tall as an exemplar of a county council to partner with. Not only has it match-funded the Government money, but it has proved effective in ensuring that planning barriers were removed and in co-ordinating all the different elements that need to go into a smooth roll-out of superfast broadband. It does not surprise me at all that the programme is already ahead of schedule; a lot of the credit for that has to go to the county council.

My hon. Friend also mentioned the Tove valley community broadband project in the south of Northamptonshire. I echo her comments. That is a hugely successful project, as she said, with more than 50% of the households in its target area having signed up for the superfast service, making the project financially viable. I am pleased to say that Broadband Delivery UK and the Department for Environment, Food and Rural Affairs have, in principle, approved £118,000 for the project through the rural community broadband fund. It is good to see how the local communities have worked so closely to put together the project, which will bring superfast broadband to Tove valley.

I am delighted with the excellent progress that we have seen in Northamptonshire and I look forward to the continued success of the county roll-out, which will see a further 18,000 premises passed. I am pleased that we were able to find the additional money—£3.64 million —to go to Northamptonshire as part of the superfast extension programme.

Nothing is ever perfect and I take on board my hon. Friend’s points about some of the issues that she is having to deal with in her constituency. I have to say that I have found BT to be a very good partner in terms of broadband delivery roll-out, but I hear what her constituents in Grange Park say, which is that perhaps, in her words, they are being held to ransom by BT, as BT is the only supplier.

26 Feb 2014 : Column 164WH

However, it is probably worth pointing out that BT often finds itself as the only supplier in areas where other commercial suppliers simply will not compete because it is not necessarily commercially viable. She will not find Virgin Media there because it may not be commercially viable for it to compete in Grange Park. Although one finds a plethora of commercial suppliers competing for the business market, the residential market is less competitive, because, to put it bluntly, it can be less profitable.

My understanding is that in Grange Park, some 650 premises already have superfast broadband as part of BT’s commercial roll-out. A further 193 premises will get it in 2014 as part of BT’s commercial roll-out, and 77 premises in Grange Park will get it as a result of the rural broadband initiative. That still leaves some 700 to 900 premises looking for a solution, so my hon. Friend is absolutely right to raise the issue, and to do so in this Chamber. I promise her now, in this forum, that I will get back to BT, BDUK, and the county council, and work with her to see whether we can make progress on a solution.

I was also pleased to hear my hon. Friend mention mobile coverage. She rightly expected me to solve a number of problems for her in the Chamber this afternoon, so let me see whether I can oblige. I am delighted that we are now seeing the roll-out of 4G—fourth-generation technology for mobile phones. It was a fraught process to get to a position in which we were ready to auction the spectrum, but the spectrum auction went very well and we are now seeing the roll-out of 4G nationwide. That roll-out itself is set to conclude some two years ahead of schedule; the licences require 98% coverage for one licensee by the end of 2017, and my understanding is that all four main operators plan to reach that figure by the end of 2015.

I have to say to my hon. Friend that, according to my understanding, from discussions with the operators when they give indications for specific areas or constituencies of the country, we will see a significant uplift in terms of mobile coverage. Not only will 4G coverage extend mobile coverage significantly, but the roll-out of 4G will also see, as a knock-on effect and knock-on benefit, a significant increase in coverage of 3G.

Mobile coverage, alongside fixed broadband coverage, is an issue of significant concern to the Government. We are actively looking at that to consider ways in which to improve it, because what sums up the whole debate, and why it is so appropriate for my hon. Friend to have secured it, is the recognition over the past few years that good, superfast, digital communication, whether mobile or fixed, is becoming an essential aspect for almost every business and an essential part of our leisure life as well. That is why I am so pleased that the fixed broadband project is going well.

I am pleased that we are delivering in my hon. Friend’s constituency. Nothing is ever perfect and she is right to point out where there are gaps in coverage. I repeat my pledge to work with her, the county council, BT and BDUK to deal with the issues that she has raised.

26 Feb 2014 : Column 165WH

CE Marking (Structural Steelwork)

4.38 pm

Gregg McClymont (Cumbernauld, Kilsyth and Kirkintilloch East) (Lab): It is a pleasure to serve under your chairmanship, Mr Williams. Most people will be familiar with CE marking. Some goods have had it for years, from kids’ toys to kitchen appliances, from bike helmets to our hot water boilers, among other things. CE marking was introduced as a means to create a level playing field in the internal European market, starting way back in 1988. It is, of course, a consumer protection device to ensure that manufactured goods are made to standards that are harmonised across the European Union.

Recognising the challenges involved in providing a standard certification mark on manufactured goods, it was decided to phase in the introduction over a long period. That has led to different dates set for various goods since 1988 and it is still continuing to this day. The most recent incarnation of the mark was in 1995 and it continues in most product areas without a major problem. However, there is a problem for the Government and steel fabrication industry with the requirement for CE marking on all fabricated steelwork and construction in civil engineering to be in place by 1 July 2014. I want today to draw the Government’s attention to the implications of that requirement.

Let me give some background. The Government have championed the idea that they are a friend of small business, and that is indeed a sensible approach. Just last month, for example, speaking to the Federation of Small Businesses, the Prime Minister announced a plan to scrap 3,000 rules affecting small businesses, saying that he wanted to

“get out of the way of small business success.”

We can all agree with that laudable aim, but the reality on the ground can be different.

It was in that context that I was first contacted by a firm local to my constituency, T&D Cruickshanks, based in Kirkintilloch. Cruickshanks, a third-generation family-run business established in 1948 with four employees, is exactly the kind of small manufacturing business that the Government hold up as an example of an enterprise that they are setting out to support and that we all need to succeed. It is in the spirit of cross-party support for small businesses of that kind and others that I bring this issue to Parliament. Mr Cruickshank is absolutely clear about the impact on his business. Businesses that do not comply with the new CE marking certification by 1 July 2014 will be trading illegally, and Mr Cruickshank is very clear that certifying products involves significant costs for a small business such as the one his family have run for generations.

That focus on the lack of awareness in the fabrication industry of the necessity of meeting the new certification standard has been echoed by another business in my constituency, Highland Galvanizers, based in Cumbernauld. Geoff Crowley, the managing director, is very clear that upwards of 700 companies just in Scotland are unlikely to be compliant by 1 July. Geoff has been at the forefront of efforts to warn of the impending introduction of CE marking on fabricated steelwork in construction and civil engineering, and to make firms and the Government aware of it—it is coming up very fast.

26 Feb 2014 : Column 166WH

It appears that the steel fabricators, suppliers and manufacturing industry, especially at the small business end of the chain, are largely unaware of what comes into force on 1 July, and are therefore unprepared. The preparation to comply with the CE certification marking, according to my industry discussions, takes perhaps six months. Many have not started. There are notable exceptions, especially the members of the British Constructional Steelwork Association, which has made CE marking compliance a condition of membership and is training its members in becoming compliant with the EU regulation.

In advance of the debate, I asked the Minister a number of parliamentary questions. In his response, he directed me to a 2009 impact assessment. With help from those on the front line in the fabrication industry, I have identified a number of issues about the impact assessment, on which I am sure the Minister will be pleased to respond.

First, the 2009 report relates to the whole construction products directive, whereas today we are seeking to address specifically the subsection that relates to the steel fabrication industry. [Interruption.] Members of the press are looking increasingly fascinated as I proceed. Secondly, the consultation was with larger bodies—trade associations, large companies and the like—which were within easy reach of civil servants. That makes the results unreliable because it ignores the challenges faced by small companies, which are often not members of trade bodies.

The impact assessment estimates the number of businesses affected to be about 18,000 and a total cost to them of £66 million, with an annual cost for maintenance of £12 million. I wonder how those estimates stand now. Will the Minister provide more clarity on the cost of meeting those marking certification standards? Anecdotal evidence from Scottish steel fabricators who have already implemented CE marking is that implementation costs of £20,000 are not unusual for larger businesses, and that quotes from consultants to help smaller fabricators to meet the new standard range from £5,000 to £10,000.

Further to that, the impact assessment, at paragraph 29, removes half of those who might be affected by the new certification standard, because—this is the impact assessment’s own description—half of those who would be affected will have voluntarily become CE mark certified on the basis that they might want to do business abroad. We have to be aware of the impact assessment in that context. Does the fact that business might be certified for another reason mean that that cost should be removed from the impact assessment? Are those calculations accurate enough for hon. Members to make a judgment about the potential implications of the certification and ensuring that the industry across the board is compliant?

The impact assessment recognised that small businesses would be affected disproportionately. We are talking about small businesses that only sell locally and that are not exporters. There is little benefit for them in CE marking in itself. Of course, they are already at a disadvantage compared with larger suppliers in the industry, which can easily afford to absorb the costs of meeting the new standard. That creates obvious financial and compliance challenges for small steel fabricators such as Cruickshanks in Kirkintilloch.

There was clearly some recognition of the potential problems with the new CE standard—an impact assessment was undertaken in 2009—but, five years later, it appears

26 Feb 2014 : Column 167WH

that not much has happened to ensure that small steel fabricators are aware of the requirement, which has to be met by 1 July, and aware of any support that can be given to meet it.

In paragraph 61, the impact assessment asks those consulted how they think the certification standard will impact on competition. Larger companies thought that the impact would be positive, whereas small businesses saw it as negative and thought that the measure would reduce choice and drive smaller businesses out of the marketplace. Paragraph 65 recognised that smaller businesses, particularly those that are not members of trade bodies, would suffer from poorer communications—it is much more difficult to get the message out to small businesses. From the discussions I have had with the Scottish part of the steel fabrication industry in particular, but not exclusively, I think the problem is that many of the small fabricators are simply unaware that the requirement is coming. Some just do not believe it. Some have heard and are hoping they will be unaffected.

I say again that the British Constructional Steelwork Association is doing sterling work in trying to shed light on the requirement and has made compliance with CE standard marking a condition of membership. The Federation of Small Businesses is also alerting its members to the deadline. However, those few bodies in the UK that are authorised to assess and certify companies seeking CE accreditation, such as the Steel Construction Certification Scheme and the Welding Institute, are under-resourced and already booked up beyond the 1 July deadline. That is what I am told.

Since I secured the debate, I have been contacted by a number of small businesses—steel fabricators, welders and the like—across the UK. Organisations that procure large quantities of steel, such as those behind large-scale construction projects, are already beginning to demand that smaller suppliers be CE accredited. There is a real issue in that the vast majority of Scottish fabrication businesses will not be eligible to tender for that kind of work after 1 July, because they will not have met the certification deadline. Local authorities are starting to wake up to that, and I hope the Minister will tell us what action his Department is taking to ensure that local authorities are acting, and what Government guidance and help has been given.

Businesses that recognise that they need to act—that requires having some training and subsequent qualification, putting some administrative procedures in place and having an audit by a notified body—find that there seems to be a lack of available resource. There are few trainers and fewer assessors, and they are booked up beyond 1 July. My understanding is that trading standards has to be responsible for the enforcement of the CE marking standard. What action has trading standards taken to inform those in the industry that the standard must be met? Has trading standards taken it upon itself to offer advice?

I look forward to the Government grasping the matter. There is a significant problem for small businesses—smaller fabricators lack awareness of the requirement to meet the standard by 1 July. The Government have a role to play, and if they believe that small businesses are the engine room of the economy, I hope they engage in a positive and constructive spirit. I am sure the Minister

26 Feb 2014 : Column 168WH

will agree that it is a serious matter. Businesses may not be compliant by 1 July, and all hon. Members should be aware of the potential implications for those businesses and their staff. I look forward to the Minister informing me and those at the sharp end of the industry how the situation will be resolved before 1 July.

4.52 pm

The Parliamentary Under-Secretary of State for Communities and Local Government (Stephen Williams): Diolch, Mr Williams. Prynhawn da—good afternoon to you. I congratulate the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East (Gregg McClymont) on securing the debate. We were not entirely sure what points he was going to raise. I gather from his introductory remarks that he was speaking on behalf of at least two construction steel producers in his constituency: T & D Cruickshanks from Kirkintilloch and Highland Galvanizers from Cumbernauld. We almost had the full set; we did not get a company from Kilsyth, but the fact that two of the three communities in the hon. Gentleman’s constituency contacted him about the matter demonstrates its importance to the firms that he represents.

I have a comprehensive brief to get through, and I believe that it anticipates all the points that the hon. Gentleman made. The area is complex, as I am sure that he realised when he briefed himself up on it. The construction products regulation is European Union legislation, which came into force across the European Union on 1 July 2013 except in the construction steel industry, which has until 1 July 2014. That legislation is applicable across all member states. It is a free trade measure that requires construction products covered by a harmonised product standard to carry the CE marking. The regulation also requires manufacturers to provide robust and reliable information in a consistent way, which benefits industry and reduces potential barriers to trade.

There are four main elements in the regime, which I will outline briefly. First, there is a suite of harmonised technical specifications that exist to establish a common approach across Europe to product standards. Industry is responsible for developing those standards, and business and the British Standards Institution play an active part in their development. Secondly, there is a requirement to affix CE marking and to provide a declaration of performance to accompany the product, setting out how it performs against the essential performance characteristics in the standard.

Thirdly, there are agreed systems to ensure the accuracy and reliability of the performance set out in the declaration of performance, which are called the assessment and verification of constancy of performance—I said that this was a complicated area. Those systems reflect the level of risk associated with the product and the potential for performance to vary. Finally, there is a framework of notified bodies, which are independent third-party organisations involved in the assessment and verification of performance. That package is designed to provide certainty for industry and remove barriers to trade while ensuring that proper safeguards are in place relating to safety.

There are more than 400 harmonised standards relating to construction products. All those, apart from in the area of construction steel, came into force on 1 July 2013. Some in the industry expressed concern about the

26 Feb 2014 : Column 169WH

introduction of those regulations last year. However, we have since discovered that there were significantly fewer practical problems than were feared in the other 399 areas last year.

The standard on structural steelwork is covered by BS EN 1090-1, which deals with products such as piles, columns, beams and stairs. Unlike most other construction products, the CE marking of fabricated structural steel products is not required until July 2014. That means that the industry will have had three and a half years since the publication of that standard to prepare for its implementation. The European Commission gave the industry that additional 12 months’ leeway because it recognised that there were a large number of small steelwork fabricators who would benefit from the extra time. It was anticipated that the sector might need a little more time to adapt and prepare.

The hon. Gentleman asked several questions about how prepared industry should be and whether the changes had been publicised. My Department, which leads across the UK for this area, has been working with a wide range of organisations to ensure that industry is aware and prepared. Both my Department and the Department for Business, Innovation and Skills have produced a range of information about what is required under the regulations, and there is further information and guidance on the planning portal.

However, industry is also responsible for raising awareness, and trade associations have been at the forefront of that work. I have with me the brochure produced by the British Constructional Steel Association, with assistance from Tata Steel, in July 2013—just as all the other construction standards were being introduced—to publicise further the changes that would be required this year. Larger firms in the industry, such as Tata, have played an active role in raising awareness right across their supply chain. I gather from the hon. Gentleman’s remarks that T & D Cruickshanks and Highland Galvanizers will be involved in the supply chain for larger users of their product.

Trading standards in England, Wales and Scotland will be responsible for providing advice at a local level to businesses, and they will police the regime once it is in place. In answer to a specific question asked by the hon. Gentleman, not only have officials from my Department arranged events for trading standards departments in English councils, but we have done the same for Scottish councils in general. An event was held in Motherwell in April last year to enable Scottish councils to prepare in plenty of time for the changes that will take place this year.

The hon. Gentleman also made some points about costings. I understand that the industry has expressed concerns about the costs of implementation, which principally result from the need to involve a third-party notified body to establish the performance of the product and ensure that systems are in place to maintain performance. The extent of the costs depends on the product type and generally reflects the fabricators’ existing quality systems, how involved the notified body is in establishing performance, and the ongoing monitoring of production.

For structural steelwork firms, the safety-critical nature of the product means that there is not only an initial inspection by the notified body, but subsequent routine checking of the factory production control. Many larger

26 Feb 2014 : Column 170WH

firms will already incur similar costs through their voluntary adoption of third-party quality control schemes. Nevertheless, we recognise that for small firms, such as those in the hon. Gentleman’s constituency, incurring such a cost could be a more significant additional burden. However, the costs arise as a result of the standards that have been developed by the industry itself and determined as proportionate to the level of risk involved. Of course, some costs may be offset against future efficiency savings resulting from quality improvement—for example, by avoiding mistakes because compliance processes are in place.

Small businesses have clearly made representations about assistance. I can speak for the situation in England, where BIS funds the manufacturing advisory service, which has been running workshops with small manufacturers. It has not only been raising awareness but providing financial assistance in the form of grants of up to £1,000 for consultancy support to help small manufacturers to comply. We understand from the Welsh Government that similar help is available in Wales—in fact, according to the figures I have found, it looks more generous. I believe that no such assistance has been provided by the Scottish Government, so I suggest that the hon. Gentleman raises the issue with his constituency counterpart in Scotland who will no doubt want to raise it in Holyrood.

The other key issue raised by the hon. Gentleman was about whether there is enough time for companies to comply with the new standard. As I have already mentioned, come July there will have been three and a half years for companies to prepare. I understand that there are also concerns about the number of bodies that can provide certification. Currently, six notified bodies are able to carry out the third-party tasks for checking the factory production control systems of structural steelwork fabricators. Officials in my Department are fast-tracking another notified body and will do the same for any other notified body that comes forward—provided, of course, that there is no risk of standards slipping as a result.

The hon. Gentleman said that Cruickshanks and Highland Galvanisers were worried that if they did not comply by 1 July 2014, business would effectively cease and operations would be suspended. There is nothing that any EU member state can do to change that date—that would be unfair to firms in the United Kingdom that have complied with it, and also to the other member states of the European Union single market. However, the policing of the regime from 1 July will be down to local authority trading standards bodies. If they discover that a firm has not complied by that date, or, indeed, if they have been notified already as a result of this debate that some firms anticipate not being able to comply, in the first instance we would expect trading standards to work with such firms and seek an explanation of the problems they are encountering.

At this point in the process, we can safely say that rumours that firms will be closed down are scaremongering. Perhaps this debate will give more publicity to the situation than would otherwise be the case. There is still plenty of time for conversations with trading standards to ensure that compliance problems and sanctions do not arise. Nevertheless, the important point that I want to get across is that all firms must get on with the process. There has been plenty of time for the rest of the

26 Feb 2014 : Column 171WH

construction products sector—the deadline passed last year, since when compliance problems have not been reported to us. We would urge structural steel manufacturers to adopt the same approach.

Regulations are part of an approach that seeks to promote trade and benefit business while ensuring that we have safe construction products. I am sure that the hon. Gentleman and I would be united on that, as well

26 Feb 2014 : Column 172WH

as on ensuring that small firms in his constituency and elsewhere in the United Kingdom do not find themselves unable to comply. There is still time for conversations with local authority trading standards officers, and with the British Constructional Steel Association itself, to find a clear way forward.

Question put and agreed to.

5.6 pm

Sitting adjourned.