I want to raise just one matter that could be advanced under the recommendations in the report. They would permit the Commissioner for Standards to issue guidance or codes of practice. Guidance and stricter regulation is required in relation to the election of officers of all-party groups. Most all-party groups meet as a small band, and elections take place very well in an informal way, with no statutory returning officer or heavy procedures. I would not want to over-regulate the affairs of a
13 May 2014 : Column 717
majority of all-party groups, which work, because they have limited resources, in a fairly informal way. However, we have had some recent examples of highly contested elections. I see my hon. Friend the Member for Slough (Fiona Mactaggart) in her place. When there are highly partisan and contested elections for officerships of APPGs, the cross-party consensus that exists in most of these groups is undermined. Such a consensus enables groups to have the leverage and purchase on policy that they do.
I deeply regret the fact that there was a party political campaign to take over the chairmanship of the all-party group on human trafficking, which led to two ballots, the first of which resulted in a tie. Messages were sent through party channels—not through the Whips Office, I think—through an informal system of whipping on both sides of the House. Occasionally, there are political differences in all-party groups, which fail if they fracture along political lines. If a self-denying ordinance among Members does not prevent those groups from becoming, in a small number of cases, highly politicised, some form of regulation is necessary.
I spoke to the hon. Member for Wellingborough (Mr Bone), who campaigned to take over the all-party group on human trafficking, earlier today to warn him that I would mention his name in this debate. He told me that his campaign was entirely party political, which I find disturbing. It has happened on two or three other occasions. The chair of the all-party China group was ousted, I believe, as the result of a political campaign.
Fiona Mactaggart (Slough) (Lab): My hon. Friend referred to the all-party group on human trafficking and modern slavery and the election, with a record turnout, which I won and which—he is right—was fought on party grounds. I want to reassure the House that since then, the group has been able to involve Members from all parties working equally enthusiastically on an absolutely broad basis. His comments should not lead anyone to think that that all-party group operates in any way in a sectarian manner, because it does not.
Hugh Bayley: I am glad that my hon. Friend has had the opportunity to put that on the record. It is something that I observe from the work the group does.
I should declare a personal interest: I lost the chair of the Africa all-party group because a band of people not from my political party, by a more considerable margin than is normal for our meetings, were organised—perhaps that is the way to put it—to turn up and vote for someone else who, in fact, leads the group extremely well. None of that caucus, which was organised on party grounds to come in and depose someone and elect someone else, had ever been to a meeting of the Africa all-party group, nor has any of them been to a meeting since. I would make the same statement in relation to the Africa group as my hon. Friend the Member for Slough made in relation to the all-party group on human trafficking. It runs extremely well under new leadership and I am content with it.
I believe, however, that the problem of highly contested elections reached a pinnacle of bad form in the recent election in March of this year for the all-party group on Russia. I was aware for several days beforehand that there was going to be an election. I was under the clear
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impression that the candidate from my party should be supported—a lot of messages went out trying to encourage people to turn up at that meeting and, equally, messages were sent out to members of another party to support an alternative candidate, who won the contest. One might just say that that is what happens in politics, but the conduct of that election would not pass muster if it was a public election. It would not be deemed remotely acceptable if it was a trade union ballot for industrial action. I turned up at the appropriate time in Committee Room 5, which seats 20 or 30 people at a pinch. There were 80 or 100 people in that room, packed shoulder to shoulder, and as many people outside in the corridor. The group’s officers, one from each party, had pre-printed ballot papers with the names of two candidates, although nominations were not sought until the meeting. As luck would have it, only two candidates were nominated, so the ballot papers were in order.
The two all-party group officers then started distributing the ballot papers to a sea of hands, pushing and shoving. There were no checks whatsoever on who took the papers—whether they were Members of either House or whether they took more than one paper. Indeed, I heard someone joking that they would have to go round with ballot papers again, although I saw no evidence of that. I heard people out in the corridors shouting, “Come here. It’s Room 5. Get in there!”, and asking Members to support their candidate.
I think that is a move in the wrong direction. I wrote to the Parliamentary Commissioner for Standards to say that I felt it would be possible to introduce some form of procedure in such cases to improve the transparency and democracy of the elections—I copied the letter to the Chair of the Standards Committee. There is a rule that permits any Member of either House to join any all-party group, and that is extremely important, because we do not want all-party groups to be closed shops for particular groups of people.
Thomas Docherty: I know that my hon. Friend is moving rapidly to a conclusion and will not want to spend more time on this issue than he has to, but is he aware that, as the Standards Committee states in its report, the rule on 20 members is not about who is or is not a member of an APPG? Every Member of the two Houses is a member of an APPG and has equal voting rights.
Hugh Bayley: I have a couple more things to say, but I will say them quickly.
I believe that we need a system that enables elections to take place from those who have played an active role in a group. That is why publishing a list of members of a group would be a good thing. It should be perfectly in order for someone to put their name on the list up to, say, 24 hours before the election takes place. But the idea that people can turn up to a meeting by the dozen, take ballot papers that are not numbered and not have their names recorded when voting allows a misuse of procedure that should not be permitted.
I would warmly welcome the Parliamentary Commissioner for Standards looking at this issue and, while ensuring that all-party groups remain open to all Members, allowing a better means of regulating such elections where there is a great deal of interest in them.
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8.18 pm
Sir Bob Russell (Colchester) (LD): I obviously lead a sheltered life, because in my 17 years in this place I have never witnessed, or been involved in, shenanigans of the sort that have just been described, which underline the importance of and need for the motion before us this evening. All-party groups, if used in the right way and in the right spirit, are an asset to this House, and indeed to the other place.
My experience of membership of all-party groups over the years has been one of colleagues with a shared interest coming together to promote something that is not normally done within the parliamentary channels. Last week I was elected chair of the all-party group for the island of St Helena. In the past the group has done a lot of good work in promoting the island’s interests. For example, the airport that we all campaigned for is currently under construction. I am also chair of the all-party first aid group, which brings together Members from both sides of both Houses. Its sole interest is promoting first aid. For 15 years I was secretary of the all-party scout group. Those all-party groups exist only to promote organisations in this place and benefit them because they have a wider interest in society.
In view of what the hon. Member for York Central (Hugh Bayley) said, let us go with this motion, because we do not want the sort of behaviour he described.
8.19 pm
Mr Robert Buckland (South Swindon) (Con): As a member of the Committee, I commend the report to the House. I declare my chairmanship of the autism all-party group and co-chairmanship of the European Union all-party group.
The report is an important step forward in several respects, but most notably in how we seek properly to differentiate the labelling and logos used on reports by registered all-party groups—that is, the crowned portcullis with the appropriate title of the group—and the appearance of documents such as the Select Committee report that I have in my hand. It is vital that all-party groups do not seek to publish documents that look like, or could be mistaken for, reports by Committees of this House. We have to do everything we can to make sure that the media do not continue to fall into the trap of making no distinction between the reports of all-party groups and those of Select Committees. That recommendation by our Committee is particularly important.
8.20 pm
Kevin Barron: I am very pleased that the report has the support of the House. I have heard the wider debate on the issues. Paragraph (3) of the motion gives the Committee licence to make minor changes without necessarily coming back to the Floor of the House, but we will use that in a sensible and proper manner, if at all.
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Intelligence and Security Committee
Motion made, and Question proposed,
That Fiona Mactaggart be appointed to the Intelligence and Security Committee of Parliament under Section 1 of the Justice and Security Act 2013.—(Tom Brake.)
8.22 pm
Mr David Winnick (Walsall North) (Lab): Let me make it clear that I have no objections to my hon. Friend the Member for Slough (Fiona Mactaggart) joining the Intelligence and Security Committee. I think we would all agree that she is a person with quite an independent mind, and certainly a strong personality, and no doubt she will make a useful contribution to the Committee. This is nothing personal, and I am sure she did not expect there to be any criticism along those lines.
However, I am far from satisfied that the method of being nominated in the name of the Prime Minister is the best way for a Member to join the ISC. It is going back to former times. The Leader of the House looks rather puzzled, but he knows full well that a system existed in the previous Parliament whereby names appeared on the Order Paper and we would agree to them or otherwise, as the case may be. I take the view that the ISC should be subject to elections. Fortunately, that is not only my view. In paragraph 158 on page 62 of the Home Affairs Committee report on counter-terrorism, which was published last week, it says:
“we recommend that the Commons membership of the Intelligence and Security Committee should be elected like other select committees and that the Chair, who should always be a member of the Commons, ought to be subject to election of the whole House, as is the case for Select Committees.”
It is interesting to note that there has been a great deal of competition as to who should be the Conservative Chair of the Defence Committee. We receive a good deal of correspondence on that subject. While that post is subject to a great deal of competition, and we will decide on it accordingly in the democratic way on Wednesday, for membership of the ISC there is no election whatsoever. A name is put before us and we either accept or reject it.
I simply want to say that whenever an opportunity such as this arises, I will make my views known. This is not an acceptable way to proceed—the Home Affairs Committee agrees—and membership of the ISC should be subject to election. I would hope that at least the Deputy Leader of the House—a Liberal Democrat—would also take that view. Having made my position clear, I do not oppose the motion, but I will use every future opportunity to make my views known.
8.25 pm
Dr Julian Lewis (New Forest East) (Con): I have the greatest respect for the hon. Member for Walsall North (Mr Winnick). He is a man of great seniority in this House and we always, rightly, listen very carefully to what he has to say. There is one—and only one—reason why his proposal runs into difficulties. The simple point is that this particular Committee, unlike any other, has access to highly classified information up to the range of top secret, strap-2 level and occasionally higher.
Some people believe that this country should have no secrets at all and that if we had no secrets, there would be no classified information and no case for treating the membership of the Intelligence and Security Committee differently from that of the Defence Committee.
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Mr Winnick: I am grateful for the hon. Gentleman’s kind remarks, but does he accept that, in the 1980s, before the ISC was formed—I was on the Standing Committee that led to its formation—it was very difficult to get the matter raised at all when I tried to initiate debates on the Security Service? I am in favour of such a Committee and I am certainly in favour of the security services—even more so in the face of acute terrorism—but I want accountability, and I think that is the main difference between the hon. Gentleman and me.
Dr Lewis: I hope to show that the difference between us is as small as possible. I was certainly not suggesting that the hon. Gentleman was not in favour of this country having security and intelligence services or, indeed, highly classified secrets. It was as a result of the work that he and his colleagues did back then that it became possible to open up the intelligence and security agencies to much greater scrutiny. Their activities can now be examined and debated considerably. To a large extent, that happens in the open—in the public arena of Parliament—but when it cannot be done in the open, it can now, thank goodness, be done in the closed and secure environment of the Intelligence and Security Committee.
I will move on quickly, because I do not wish to detain the House for longer than is necessary. Some people think that we should have some secrets but that there is not a single hon. Member of this House who could not be trusted to know them. If that is one’s view, there would not be any argument against the membership of the ISC being elected just like the membership of any other Committee. However, the membership of this House reflects society in all its varied shades, phases, types and categories. The fact is that I do not think there are many people who would say that, out of 650 Members, there are not at least some who are not quite, shall we say, discreet or tight-lipped enough to share in the most sensitive secrets of the security and intelligence agencies. If one makes that concession, one has to admit that this Committee, if it is going to see such material, has to have some sort of screening process and cannot simply be subject to the ordinary process of election, unless we are content that any single elected Member of this House can, by definition, be trusted not to do something foolish if given access to highly sensitive information.
Mr Winnick: We all know, of course, of the hon. Gentleman’s own history of pretending to be someone else—namely a Labour supporter—in order to infiltrate the Labour party. I would not suggest that, because of his action then, he should be debarred from membership of the ISC.
Dr Lewis: I am delighted to know that. I have to admit to the hon. Gentleman that one of the reasons I put myself forward for a place on the Committee was to test the water and see if any of my past nefarious activities, as he would regard them, would result in my being black-balled. I came to the conclusion that I was appointed for one of two reasons: either it was thought that I was so discreet—
Madam Deputy Speaker (Mrs Eleanor Laing): Order. I fully appreciate the points that the hon. Gentleman is making, but however exceedingly interesting they may be, they do not entirely relate to the very narrow motion before us.
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Dr Lewis: Indeed, Madam Deputy Speaker. If I may, I will just conclude that sentence by saying that I came to the conclusion that it was regarded as a suitable Committee on which to put a troublemaker who could not talk about what the Committee was discussing.
In conclusion, most people think that where highly classified material is concerned—material covered by the Official Secrets Act—some people are better suited than others to be allowed to see it. It is not acceptable or compatible with that for the whole House simply to vote for any Member to be a member of the Committee, because the Committee would not be allowed to continue to receive such material. However, I hold out a smidgeon of hope for the hon. Member for Walsall North in that a case could be made on the basis of the argument that once all the members have been appointed, the objection would fall in relation to the Chairman. Once all the people who are regarded as appropriate to see highly classified information are known, I cannot see why the whole House could not then decide which of those cleared Members should be the Chairman, but perhaps that is for another occasion.
8.31 pm
Mr George Howarth (Knowsley) (Lab): It is a pleasure to follow the hon. Member for New Forest East (Dr Lewis). Indeed, I agree with everything he said, in so far as it related to the motion.
To be perfectly honest, I am slightly confused about why my hon. Friend the Member for Walsall North (Mr Winnick) chose to speak in this debate, although I do not doubt his right to do so. There can be only two reasons for someone to object to the motion: either they object to my hon. Friend the Member for Slough (Fiona Mactaggart)—but he said that he does not object to her—or, alternatively, they object to the motion itself and the procedure on which it is based. As the House will know, the motion relates to section 1 of the Justice and Security Act 2013. I suspect that he spoke against that provision when the Bill went through the House and was defeated. If he objects to the provision, I find it confusing that he said he would not object in any meaningful way. I am not quite sure what the point of his speech was. Ultimately, he will not object to her being put on the Committee, but at the same time he will not object to the procedure, so I am at a bit of a loss to explain why he chose to detain the House tonight, but perhaps he can explain.
Mr Winnick: I am puzzled that my right hon. Friend is puzzled. No, I have no personal or political objections to my hon. Friend the Member for Slough (Fiona Mactaggart)—why should I?—but as I thought I had made perfectly clear, I am opposed to a system in which, in the name of the Prime Minister, a Member’s name is simply put before us and we say yea or nay. Let me make it quite clear to my right hon. Friend that I am in favour of democracy and of people going on Committees subject to election, and that includes the ISC.
Madam Deputy Speaker (Mrs Eleanor Laing): Order. The hon. Gentleman has already made his point—in my judgment, he has made it clearly—and he does not have to repeat it.
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Mr Howarth: I think that I am grateful to my hon. Friend for his intervention, but it did not take us any further. I do not intend to address it any more, because it did not take his argument any further. Having said that, I conclude by congratulating him on the one overriding quality that I have observed him to possess over the years: he is consistent; it is just that he is consistently wrong.
Mr Winnick: That is a disgraceful remark, George, and you know it.
Madam Deputy Speaker: Order. No remarks have been made.
Business without Debate
delegated Legislation
Madam Deputy Speaker (Mrs Eleanor Laing): With the leave of the House, we shall take motions 6 to 11 together.
Motion made, and Question put forthwith (Standing Order No. 118(6)),
Copyright
That the draft Copyright and Rights in Performances (Disability) Regulations 2014, which were laid before this House on 27 March, be approved.
That the draft Copyright (Public Administration) Regulations 2014, which were laid before this House on 27 March, be approved.
That the draft Copyright and Rights in Performances (Research, Education, Libraries and Archives) Regulations 2014, which were laid before this House on 27 March, be approved.
Aggregates Levy
That the draft Revenue and Customs (Amendment of Appeal Provisions for Out of Time Reviews) Order 2014, which was laid before this House on 31 March, be approved.
13 May 2014 : Column 724
Licences and Licensing
That the draft Licensing Act 2003 (FIFA World Cup Licensing Hours) Order 2014, which was laid before this House on 1 April, be approved.
Energy
That the draft Renewable Heat Incentive Scheme (Amendment) Regulations 2014, which were laid before this House on 9 April, be approved.—(Claire Perry.)
Motion made, and Question put forthwith (Standing Order No. 118(6)),
Church of England (miscellaneous Provisions) Measure
That the Church of England (Miscellaneous Provisions) Measure (HC 1273), passed by the General Synod of the Church of England, be presented to Her Majesty for Her Royal Assent in the form in which it was laid before Parliament.—(Sir Tony Baldry.)
The Treasurer of Her Majesty's Household (Greg Hands): I have it in command from Her Majesty the Queen and His Royal Highness the Prince of Wales to acquaint the House that they, having been informed of the purport of the Church of England (Miscellaneous provisions) Measure, have consented to place their prerogative and interest, so far as they are affected by the measure, at the disposal of Parliament for the purposes of the measure.
Business of the HOuse
That at the sitting on Wednesday 14 May the Speaker shall not adjourn the House, if a Message from the Lords Commissioners is expected, until that Message has been received.—(Mr Andrew Lansley.)
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Hull Official Receiver’s Office
Motion made, and Question proposed, That this House do now adjourn.—(Claire Perry.)
8.37 pm
Diana Johnson (Kingston upon Hull North) (Lab): I am pleased to speak about the proposed closure of the official receiver’s office in Hull, and I thank the Minister for meeting me and other Hull MPs to discuss this issue on 6 May—I note that she has had busy day in the Chamber today. The proposal is to close the Hull office and relocate more than 40 staff to Leeds. The claim is that that will produce a saving of about £289,000 over five years, which rather pales by comparison with the bill of £353,000 for tea and biscuits in the Minister’s Department in 2012.
I accept that nationally the work of the Insolvency Service has declined considerably across the country over the last few years, and we are seeing fewer cases coming forward overall. However, the argument is not about reducing the number of staff employed in the service, but about concentrating work in certain locations, and that is where I want to focus my contribution this evening.
The decision to close the office in Hull undermines the efforts of all those who are working to create a more prosperous city. Hull needs an additional 7,000 jobs to get to the national level of employment, and while we have had welcome news about Siemens coming to the city—something won by local effort—we have been hit hard by the recession and three years of flatlining.
We know that the closure will take around £1 million out of the local economy, at a time when Hull has hardly any Government jobs. The Department for Business, Innovation and Skills is supposed to be committed to economic regeneration of the regions, but how does this policy help with that aim? The Government are also supposed to have a policy of distributing Government and civil service jobs around the country. What consideration was given to the relative number of civil service jobs in Hull and Leeds when making this decision?
Hull has exceptionally few Government jobs: 10 Departments, including the Minister’s own Department for Business, Innovation and Skills, have no staff in Hull. Departments that do have staff in Hull, like the Ministry of Justice, tend to have front-line delivery staff. As I said, the plan is to move the Insolvency Service jobs to Leeds, where there are already more than 9,000 civil service jobs and where office rents are far more expensive. I have observed a similar pattern repeated across the country: the insolvency office in Stoke, where rents are very cheap, is being closed and moved to Manchester where rents are higher. Previous Governments have had a clear policy of distributing Government jobs around the country—do this Government still have that policy?
I heard the Deputy Prime Minister this morning waxing lyrical on the Floor of the House saying:
“I am always open, as are the Government, to proposals on moving further parts of the public sector from Whitehall and London to other parts of the country. Sheffield”—
“has benefited enormously from that, with the Department for Work and Pensions and the business bank being established there.”
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It seems to me that we have a Government who are certainly not looking at spreading Government jobs fairly across the regions and are in fact now taking them away from East Yorkshire.
It appears that civil servants based in London have decided that it is a good idea to close offices in Hull. I imagine them in their offices in Whitehall with a map of the UK, and, almost as happened in the second world war, moving around people they think can be distributed around the country, with no thought for the effect on communities.
The business case says that this closure programme is being driven by the Cabinet Office’s Government property unit, which aims to reduce the number of properties in the central civil estate. It seems that there is a desire to centralise jobs in a few places, with little consideration given to the wider economic consequences or even to the fact that in some cities rents will be much higher than in other parts of the country. What similar cost savings have been made by the Minister’s Department in London? The plans being put forward for Hull are about saving £289,000 over five years, which is a drop in the ocean compared with the cost of renting or occupying office space in central London. How many posts have been moved out of London since 2010, and at what saving to the taxpayer? How much office space has been freed up at the Department for Business, Innovation and Skills in London and, in particular, in the head office on Victoria street?
Another of my concerns is about the consequences for the economy of the closure of the Insolvency Service for the Humber region. Through the establishment of the local enterprise partnership, the Humber is seeking to forge a path as a separate economic region with a distinct identity. The Insolvency Service has developed specialist knowledge of the region which, if these plans go ahead, will be subsumed by the wider Yorkshire region based in Leeds. Hull staff have more than 600 years of collective insolvency experience. Last year, that saved the economy more than £2.5 million, as they disqualified 20 directors. There is a particular value to having local knowledge about what is going on in an area. As we know, unfortunately many people the Insolvency Service deals with are repeat offenders. Of 17 local official receiver offices, Hull is joint fifth in terms of the number of disqualification reports—that is quite high.
An example of the good work that has been done is the fact that local knowledge in the Hull office stopped German bankruptcy tourism in the Hull county court. The limited liability partnership provided false addresses to German residents but that has been wound up thanks to the local knowledge and work of the Hull office. Without local knowledge of the places referred to, it is unlikely that that fraud would have been stopped, so will the Minister give me her view of the assessment undertaken by the Insolvency Service of moving direct regional centres to larger autonomous units in terms of the detection of fraud?
Following our meeting on 6 May, the Minister promised that she would provide the business case to me and to other Hull MPs. However, the information contained in the business case that I have been given is limited solely to the Hull, Leeds and Sheffield offices. It does not give a comparison between Hull and other offices of a similar size that have not been closed.
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The savings identified are mainly saved office costs offset by £125,000 in train fares for three years for staff who relocate to Leeds. That is good news for First TransPennine Express, the local train operator, and it may be that it can use that money to provide some much needed investment on the Hull-Leeds line instead of sending trains south. There is, however, much that is missing from the costing in the limited business plan. The first thing is redundancy costs.
The staff in the Hull office are exceptionally experienced: collectively, they have more than 600 years of experience. Having spent their lives working in Hull, however, many do not want to travel to Leeds and all have been offered redundancy payments. From union sources, I understand that redundancy costs could be as high as £1 million. Where is that allocated in the business plan? The saving of £289,000 over five years is relatively small, yet redundancies could cost £1 million. I appreciate that that is provided for by a different budget directly funded by the Treasury, but it all boils down to taxpayers' money, and the Government should be acting in a more joined-up way when looking at the closure costs of this office.
On training new staff, it is accepted by the Insolvency Service that the staff in the Hull office are required to meet the necessary case load not just of work from Hull but other areas of the country. The business case blithely presumes that all Hull staff will move to Leeds. As I said, I think there are questions about the numbers of staff who will choose to take redundancy. It takes three years to train a level 3 examiner before qualifying, but the costs of recruiting and training staff do not seem to be included in the business plan.
Bizarrely, in the very brief consideration given in the business case for moving the Leeds office, which as I said has 9,000 civil servants, to Hull, which has very few civil servants based in the city, the presumption that 30 staff would not move across is included, along with associated costs of recruiting, training and the short-term loss of capacity. Will the Minister explain why she has presumed that Leeds staff will not move to Hull, but all Hull staff will move to Leeds?
A further concern is about the way the consultation with the trade unions has been conducted. The Minister has consistently maintained that the Insolvency Service has been attempting to work with the Hull office to find a way of keeping the office open. In answer to a recent parliamentary question, the Minister wrote:
“The trade unions were made aware on 25 February 2014 that the future of the Hull office was being considered, and were invited to provide any views they wished.”—[Official Report, 6 May 2014; Vol. 580, c. 93W.]
This was not, however, the impression given to the trade union, Prospect. Prospect told me
“that the Service would be running exit schemes and then closing offices. There was never discussion on whether an office closure was justifiable as we had not been provided with the financial justification and despite requests by the Trade Unions, the Service would not release the business cases for the closures.”
Consultation with the trade unions only commenced when the decision to close the Hull office was made on the basis of a statutory 90-day consultation. Will the Minister outline exactly when the trade unions were involved, and what opportunities they were given to
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inform the closure plans? The Hull office was told on 25 February that the future of the office was under review and that the review would take six months. In the meantime, it looked at ways of reducing its costs, including preliminary discussions on new premises that would reduce the rent by approximately £90,000 per annum. Obviously, office rent is one of the key issues in this whole business. Two weeks later, however, the service informed the Hull office that it would be closed, and showed no willingness to work with the office in seeking alternatives to closure. It is clear from the business case that no consideration was given to cost reductions within the current structures, as identified by the team working in Hull.
The savings from the closure of the Hull office appear to me to be uncertain, but the £1 million cost per year to Hull’s local economy would be all too certain. We know that, owing to decisions made in Whitehall by the coalition Government, Hull city council suffered one of the heaviest funding cuts in the United Kingdom—despite being the UK’s 10th most deprived area—and there are worries about not just Hull’s insolvency office but its land registry office, whose future is currently under review.
The coalition frequently claims to support the idea of “rebalancing the economy”, north and south. As I said earlier, one way of doing that would be moving Government Departments and agency civil servants’ jobs to places such as Hull rather than taking them away. This debate may be about saving only 40-odd jobs in Hull, but every job matters in a town where so many people chase each job vacancy and so many jobs are low paid and low skilled.
I think that, provided that the service is needed and can be run efficiently, we should fight to save every job in Hull that is under threat, and there is a strong case for keeping the official receiver’s office open. That would be consistent with what the Government say their policy is—but too often what they say and what they do are different things, especially when it comes to the treatment of northern cities such as Hull. It seems to me that devolved jobs are going the same way as Lord Heseltine’s devolved funding, and that, yet again, Hull is not getting a fair deal from this Government.
8.52 pm
The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Jenny Willott): I trust that we will not detain you for too much longer, Madam Deputy Speaker.
I thank the hon. Member for Kingston upon Hull North (Diana Johnson) for securing the debate. I recognise the interest that she has shown in the relocation of the Insolvency Service’s office in Hull. As she said, we met last week to discuss the issue, along with other Hull Members, and I entirely understand why she is concerned about the potential impact on her constituents and is representing their views this evening.
Let me put the position in context. The Insolvency Service is an executive agency of the Department for Business, Innovation and Skills. It has about 1,800 employees, who operate from locations throughout the country. They deal with a wide range of insolvency matters, such as administering bankruptcies and liquidations —which includes realising assets and distributing them
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to creditors—dealing with corporate malpractice and misconduct by investigating companies and individuals abusing the system, and managing payments to employees who are made redundant. The administering of insolvencies is funded by fees charged against the assets of insolvents. It is obviously very important to the creditors involved for the costs to be kept as low as possible, while still providing for an effective and fair service.
As the hon. Lady acknowledged, the past five years have seen a sharp drop in the number of insolvencies handled by official receivers’ offices, from about 80,000 cases in 2009 to nearer 25,000 today. That is largely because of a sharp fall in the number of debtor petition bankruptcy cases following the winding back of high levels of lending. To date, it has led to a reduction of about a third in the staff of the Insolvency Service, which has been achieved through a programme of voluntary exits.
As for the question of where offices need to be, for the purposes of official receiver work in particular, the Insolvency Service needs to be able to interview insolvents within a reasonable distance of their homes. We would therefore usually choose city or town centre locations close to transport hubs. The Insolvency Service reviewed its network of local offices in the context of customer demand and the reduced number of employees, and estimated that the estate was about a third too large. It therefore embarked on a programme of estate rationalisation, which also accords with the Government’s wider agenda of minimising the costs of their own estate.
The hon. Lady asked about the estate in London and the south-east. In the past two years the Insolvency Service has been looking at its estate across the country, and in London it has relocated to cheaper buildings in surplus Government estate in both London and Croydon. It decided to close its Watford and St Albans offices as well. It has therefore made such decisions across the UK, including in London and the south-east; it has not targeted other areas.
Individual offices need to be of sufficient size to be sustainable both as a management unit and to provide development opportunities for staff, as well as to be able to offer the necessary flexibility as workloads change. The skills needed for the different areas of work in the Insolvency Service are often similar, so in the last few years several hundred staff transferred from working on bankruptcies to investigation work as the number of cases dropped. This type of work is especially located in the larger metropolitan areas.
As a result of the review, five relocations and five closures took place in 2013-14 and a further 10 closures will take place over the coming financial year. The Insolvency Service has worked closely with the trade unions throughout this process. All employees in the affected offices have been offered the opportunity to relocate to another office or take voluntary exit terms. The Insolvency Service offers excess fares to staff for a three-year period after a move. It also discusses flexible working arrangements to try and find ways to make a move possible for employees.
The Insolvency Service is proud of its customer service, recently coming second out of 53 Government Departments and agencies, with customer satisfaction levels of 96%, which is extremely high. Around 250 face-to-face interviews arise from cases in the Hull office. That is not a large
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number in the context of the total number of bankruptcy interviews across the country, but in order to maintain high levels of customer service, interview facilities will be set up in other Government buildings in Hull, at minimal cost and with flexible arrangements, to be available for meetings. Replacing an office with an interview facility makes no difference from the point of view of customer experience.
Turning to the specific concerns with respect to the Insolvency Service in Hull, there are 43 permanent employees in the Hull office and the prime purpose of the office is to carry out the duties of the official receiver. Case numbers in the area served by the Hull office have seen an even greater decline than the fall in caseload nationally, with a drop in workload of 79% since 2009, which is a huge drop. Staffing levels in Hull, however, have only fallen by 43%, so there is a mismatch there.
The office was kept busy over the last two years by taking cases in from other offices. The Insolvency Service prefers each official receiver’s office to deal with the cases that arise within its area. As the hon. Lady said, that local knowledge is important. Also, with the general declining workload there is less surplus work to be transferred between offices. As a result, the Hull office is increasingly difficult to sustain from an operational perspective.
The hon. Lady mentioned the number of company director disqualifications achieved in Hull. The total number of disqualifications in 2013-14 was 27, and that was a great result by the staff in Hull and reflects very well upon their commitment and expertise. To put the figure in context, there were 1,273 company director disqualifications in 2013-14. There is significant value in disqualifications, but the disqualification work carried out by Hull will not be lost, but will be transferred to other locations, including Leeds, so disqualifications will continue.
On 27 March the Insolvency Service announced that its office in Hull would close, with its work and employees being relocated to Leeds in November 2014. This decision will both help the service reduce the number of offices and also improve long-term resilience in the face of reduced case numbers. Consolidating in Leeds allows the Insolvency Service to use its work force more flexibly, and in the longer term to offer a wider range of career opportunities to staff.
Diana Johnson: I am listening carefully to the Minister’s remarks, but the coalition Government said that they wanted to rebalance the economy and ensure that all the regions benefited. Taking away the limited number of Government jobs in Hull, an area that is blighted by terrible unemployment, flies in the face of what the Deputy Prime Minister said just this morning in the House.
Jenny Willott: We recognise that rebalancing the economy geographically is important, and I will come on to some of the work that the Government are doing in that area. We are not talking here about taking work out of the north of England and centralising it in London: we are talking about ensuring that the estate of the Insolvency Service is sensibly spread across the country and that the offices are where the work is. That is an important part of having an effective and efficient operation.
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I appreciate that the decision to close the office is not what Hull employees want and I know that the Insolvency Service board did not take the decision lightly. I am aware that the board fully considered the option of moving to cheaper Government property in Hull, as well as closing its Leeds office and moving those operations to Hull. The business case put forward did not just include accommodation costs: it also looked at other benefits, such as efficiency savings stemming from combining teams, the ability to be flexible in how the Insolvency Service deploys its employees and the greater potential for personal development provided by moving between different roles in a larger office.
The business case calculated that a move from Leeds to Hull would have a net present cost of £535,000 over five years, against a net present value saving of £289,000 for a move from Hull to Leeds. Costs would have been higher for a move from Leeds to Hull because the lease on the Leeds building runs until 2018, whereas the Hull lease only runs until 2016. That is a significant difference.
Diana Johnson: I am interested to hear about the leases, and we discussed that issue when we met last week. Have there been any discussions or consideration—it was not in the business plan that I saw—of whether the office space in Leeds could be sub-let? Rent is much more expensive in Leeds than it is in Hull.
Jenny Willott: At the meeting last week we also pointed out that it is not physically possible to fit all the employees from the Leeds office into the Hull office, so we would need to find a new office in Hull and bear all the costs of refurbishing that. That option was looked at in detail, but it simply was not a financially viable alternative.
The business case took into account that not all the staff would wish to move from Hull to Leeds, although the hon. Lady said that it did not. The estimate was that about half would move and half would take voluntary redundancy. The costs associated with that were built into the business case for both scenarios. The Insolvency Service board considered that the business case for moving from Hull to Leeds was persuasive. Those employees who wish to relocate will have a job in the Leeds office, and the Insolvency Service will pay excess fares for three
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years. The Insolvency Service has been having one-to-one meetings with its employees as well as keeping closely in touch with their representatives about the implications of the relocation and the impact on individuals. For those who do not want to move office, the option of voluntary redundancy is available, but that is clearly the last resort for most people.
The hon. Lady also raised concerns about employment in the Hull area. I reiterate the Government’s commitment to supporting the Hull area. This issue was raised in Deputy Prime Minister’s questions earlier, and it is a real commitment on the part of the Government. The Humber local enterprise partnership predicts that the city deal for Hull and Humber will deliver more than 4,000 jobs in offshore wind-related industries; at least 1,100 unemployed young people supported into work; 3,400 construction jobs; an expected £460 million of private sector development on the Humber; engagement with more than 3,000 businesses; and the provision of extensive support to 500 businesses, creating approximately 400 jobs. Significant effort and work are therefore going into the area, and the Government are committed to ensuring that we invest in other regions of the UK, and that we are not focused centrally on London and the south-east.
In conclusion, I appreciate that this is a very difficult time for the Insolvency Service and its employees. I hope that the hon. Lady is reassured that the Insolvency Service is aware of the issues that she has raised, that her questions have been considered and that the service is supporting affected employees during the transition period.
The Insolvency Service wants to maintain and improve its already high levels of service delivery. It is making its services more efficient to improve returns to creditors. I appreciate that this is a challenging time for staff, but I congratulate them on maintaining high levels of performance throughout a very difficult programme of change. I hope that I have reassured the hon. Lady that the proposal has been well thought through, that the alternatives have been considered, and that staff and trade unions have been involved and consulted throughout.