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Written Statements

Tuesday 22 July 2014

Business, Innovation and Skills

National Minimum Wage Regulations

The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Jo Swinson): Today, I publish a consultation document and draft consolidated national minimum wage (NMW) regulations for public consultation.

The NMW regulations, which set out the detailed NMW rules, came into force on 1 April 1999. Since then, the NMW regulations have been amended over 20 times. As well as the annual changes to the NMW rates, there have been a number of substantial changes to the rules over the years.

As part of the red tape challenge, we concluded that the NMW regulations and subsequent amending regulations should be consolidated into a single set of regulations.

We have also taken the opportunity to update the drafting to reflect current drafting practice, such as making the provisions gender-neutral, and to try and ensure that the rules are set out as clearly and accessibly as possible.

This consultation seeks views on whether the draft consolidated regulations 2014 are clear and workable. It is not intended to reopen the policy decisions behind the detailed rules.

I am placing copies of the consultation document in the Libraries of both Houses.

UK Atomic Energy Authority (Triennial Review)

The Minister for Universities and Science (Greg Clark): The coalition Government made a commitment to review public bodies, with the aim of increasing accountability for actions carried out on behalf of the state. The triennial review of the UK Atomic Energy Authority (UKAEA) is one of the Department of Business, Innovation and Skills (BIS) reviews of non-departmental public bodies (NDPBs) scheduled to commence during the first year of the second programme (2014-15). This is not a review of the policy relating to fusion research to which the Government remain committed.

The review will be conducted as set out in Cabinet Office guidance, in two stages.

The first stage will:

Identify and examine the key functions of the UKAEA and assess the requirement for these to continue;

If continuing, then assess delivery options and where the conclusion is that a particular function is still needed examine how this function might best be delivered, including a cost and benefits analysis where appropriate;

If one of these options is continuing delivery through the UKAEA then make an assessment against the Government’s “three tests”: technical function; political impartiality; need for independence from Ministers.

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If the outcome of stage 1 is that delivery should continue through the UKAEA as an NDPB, then the second stage of the project will be to ensure that they are operating in line with the recognised principles of good corporate governance, using the Cabinet Office “comply or explain” standard approach.

When completed the report of the review will be placed in the Libraries of both Houses.

Prevention and Deterrence of Undeclared Work (EU Opt-in)

The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Jo Swinson): The European Commission has proposed the establishment of a European platform to enhance co-operation in the prevention and deterrence of undeclared work. The Government consider that the activity against which the co-operation is directed—failure to declare work—is treated as a criminal matter in many member states, and that the proposal requires law enforcement authorities to collaborate with the platform. The Government have therefore asserted the United Kingdom’s opt-in in respect of this proposal, to the extent that the proposal requires law enforcement authorities to collaborate with the platform, and have decided to opt in.


Equitable Life Payment Scheme

The Economic Secretary to the Treasury (Andrea Leadsom): As of 30 June 2014, the scheme has now issued payments totalling £972.9 million to 877,414 policyholders. The scheme has published a further progress report, which can be found at: www.gov.uk/equitable-life-payment-scheme.

The scheme has gone to significant lengths to trace eligible policyholders. It remains committed to tracing and paying as many eligible policyholders as possible, and will continue to consider all proportionate actions it can take to do this.

The scheme encourages any policyholders who believe themselves to be eligible to call the scheme on: 0300 0200 150. The scheme can verify the identity of most policyholders on the telephone, which means any payment due can usually be received within two weeks.

Stakeholder Child Trust Funds (Lifestyling)

The Financial Secretary to the Treasury (Mr David Gauke): The Government will formally consult in 2015 on the application of the “lifestyling” requirement to over 4 million stakeholder child trust funds (CTF). This requirement is designed to manage volatility in account investments as stakeholder CTFs approach maturity, when the account holder turns 18.

A number of respondents to the Government’s recent consultation on the transfer of funds from CTF to junior ISA questioned the value of lifestyling for many

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CTF holders. The Government wish to explore this issue further through consultation with CTF providers, account holders, parents and other interested groups. This consultation will take place alongside the Government’s changes to the CTF rules that will allow parents to transfer CTF funds to a junior ISA from 2015.

Pending the outcome of this consultation, the Government propose to amend the child trust fund regulations to defer the requirement upon CTF providers to commence lifestyling for two years. CTF providers will not therefore be required to begin lifestyling stakeholder CTFs before account holders reach 15.

Councillors' Travel (Tax Exemptions)

The Financial Secretary to the Treasury (Mr David Gauke): The Government are announcing today that they intend to introduce legislation to exempt from income tax and national insurance contributions (NICs), travel expenses payments made to local councillors.

Local councillors perform a vital but frequently unsung constitutional role working on behalf of local people, often in addition to other professional and personal commitments. They are required to perform their duties in both the communities they serve and their council offices and most receive no payment other than allowances in recognition of the time and expenses they incur.

The Government want to ensure that nobody is discouraged from representing their local community as a local councillor and therefore intend to introduce this new exemption so that in the future, travel expenses paid to local councillors, including those to cover the costs of journeys to their council offices, are not subject to income tax or NICs.

The Government will provide further details of the exemption, and the time scale for introduction, in the autumn.

UK Remittance Market

The Economic Secretary to the Treasury (Andrea Leadsom): My predecessor last addressed the House on the issue of continued remittance flows to Somalia on 22 January 2014. Since that time significant progress has been made, but there is more to do by the Government and industry stakeholders.

As we have previously made clear, the UK Government recognise that remittances play a vital role in supporting developing countries, enabling them to move from dependence on aid to self sufficiency and growth. The World Bank reports that global remittance flows to developing countries are more than $400 billion, and are expected to reach $540 billion by 2016.

However, we also recognise that there are considerable difficulties for payment institutions providing services into countries where regulatory and supervisory frameworks are in development, to ensure that the UK financial system is not a conduit for terrorist financing or money laundering. It is important that we ensure remittances flow through secure and transparent channels to effectively detect and deal with those who seek to use remittances

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to launder money or fund terrorism; as well as protect the majority of remitters who are sending funds for legitimate purposes.

The remittance industry is adapting, with individual money service businesses (MSBs) taking steps to enhance their anti-money laundering compliance; especially within the Somalia corridor. Wholesale MSBs are developing and deploying new systems to improve transparency, operational efficiency, and security of remittance transactions; while other market players are using technology options, such as mobile payments, to improve transparency.

HM Revenue and Customs (HMRC) has strengthened its supervision of MSBs, including increasing the number of inspections, to provide greater assurance that they are meeting their anti-money laundering and counter financing of terrorism obligations. It is developing an e-learning package for MSBs to improve levels of compliance. HMRC is holding regular discussions with banks and MSBs to give banks greater confidence that MSBs are subject to the same standards they are and that they are being effectively supervised by HMRC.

The action group on cross-border remittances, which brings together representatives of the banking and money remittance industries, consumer groups and Government agencies, has made the following progress:

HMRC and the joint money laundering steering group have developed guidance for financial institutions providing banking facilities for MSBs and for MSBs themselves on complying with their anti-money laundering and counter financing of terrorism obligations. As part of the development of guidance, MSBs have committed to adopting best market practice, over and above meeting the minimum legal requirements;

the National Crime Agency have held workshops with banks and MSBs to help develop a better understanding of risk, to help them identify good practice and improve systems as well as detect warning signs and poor practice in the sector; and,

the safer corridor pilot for UK-Somalia remittances, led by the Department for International Development (DFID), is developing a series of co-ordinated interventions to address perceived risk at each stage of the remittance transaction and ensure remittances continue to flow through secure, accessible channels. The detailed design process has been initiated, supported by the World Bank, incorporating consultations with all relevant stakeholders in the UK and in Somalia. The pilot is steered by an advisory group composed of representatives from UK-Somali MSBs, UK-Somali community representatives, banks, NGOs and Government officials. More details on the pilot can be found here: https://www.gov.uk/government/policies/helping-developing-countries-economies-to-grow/supporting-pages/enabling-the-continued-flow-of-remittances

It is vital for the continued flow of remittances that the banking sector engage with individual MSBs who are raising standards now, as well as the longer-term solutions provided by the safer corridor pilot. The UK Government will continue to urgently encourage and facilitate engagement between the banking sector and MSBs on this issue in the coming weeks.

We appreciate that communication of our actions is important, especially within the Somali community, where there are concerns about the short-term viability of the remittance corridor and implications for the humanitarian situation in Somalia.

We have worked closely with community representatives to develop channels that support communication between the community and key stakeholders on this issue. Over

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the next six weeks a number of workshops will be held with the Somali community in the UK to share information on market developments and help address any community concerns. Details of these meetings can be found here:


The community and the UK Government are determined to work urgently with industry representatives to ensure that up-to-date information is available about remittances and charitable transfers in this rapidly evolving market. At present, the Government understand that:

all members of the Somalia Money Services Association (SOMSA) are sending remittances to Somalia and have secure options for remitting cash deposits; and

a number of other MSBs are operating in the Somali corridor, some using technological solutions.

In order for community members to find a solution which works for their specific situation, the UK Government have ensured that more information about these options is available from Somali Matters and the International Association of Money Transmitter Networks (IAMTN). Both SOMSA and IAMTN have agreed to keep this information updated on the following websites: http://www.somalimatters.org/ and http://www.iamtn.org/

We also understand the community’s concerns about the current humanitarian situation in Somalia.

The UK is one of the largest and most active donors to the humanitarian response in Somalia. The UK has an agreed four-year £145 million humanitarian programme. UK funds are currently supporting emergency nutrition interventions, livelihoods and resilience building through a number of partners, including international and local NGOs, the International Committee of the Red Cross and UN agencies such as UNICEF, FAO and WFP.

As part of the existing humanitarian programme, an internal risk facility has been established to support partners in the unfortunate event of any crisis. We have approved £10 million per year contribution to the internal risk facility.

In conclusion, the money remittance sector provides important services to communities and businesses in the UK, and in some instances is the only means of sending money to vulnerable communities overseas. There are risks for the MSBs themselves and for banks operating in these remittance corridors. We are urgently working with service providers to provide an environment where these risks can be managed so that the flows of money continue.

Communities and Local Government

Birmingham City Council

The Secretary of State for Communities and Local Government (Mr Eric Pickles): In her oral statement today on the report into allegations concerning Birmingham schools, my right hon. Friend the Secretary of State for Education told the House that to address the wider weaknesses that have been highlighted in Birmingham’s governance culture I have agreed with the leader of the city council, Sir Albert Bore, that there should be a

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review of governance in the city council. Sir Albert and I have asked Sir Bob Kerslake to lead the review, with such support as he considers appropriate, and which will be undertaken with the full co-operation of the city council. Sir Bob will report to me and Sir Albert by December 2014.

The review will consider the operation, culture, and structures of the corporate governance arrangements at the heart of the city council. It will assess their effectiveness and appropriateness for supporting the leadership and local service delivery needed to secure the future prosperity of England’s second city and the well-being of all who live, work, or visit there, and make recommendations.

We have asked Sir Bob in particular to make recommendations for improving the efficiency and effectiveness of the city council’s corporate governance arrangements, both in the short and medium term.

If Birmingham is to achieve its potential as a diverse, vibrant city of opportunity for all its people, this will be possible only with strong and effective civic leadership which commands the confidence of all communities. The city’s democratically elected leadership has a central role to play which needs the support of effective, transparent, and accountable governance arrangements throughout the council.

Strong and effective civic leadership equally needs the involvement of community leaders across the city. Accordingly, the Government welcome the council’s own Trojan horse review group’s recommendation that a strong civic leadership group be established with a range of credible and independent voices to drive and maintain momentum on building integrated communities for all. This has the potential to transform today’s situation, creating a city where all communities can have confidence in the future and the opportunities it will bring for them.

Local Government Finance

The Parliamentary Under-Secretary of State for Communities and Local Government (Kris Hopkins): I am today announcing the start of a technical consultation setting out proposals on the distribution of revenue support grant to local authorities in 2015-16 in order to deliver the local government finance settlement in the autumn. These proposals affect around half of total revenue spending power for councils in England but make only minor changes to the illustrative figures for 2015-16 that were set out in the course of last year’s local government finance settlement. All the proposals are in line with previous commitments, ensuring continued protection for authorities and consolidating previous reforms.

These minor changes to previous proposals set out in the attached consultation document ensure:

continued compensation for the reduced income from business rates as a result of the 2% cap on the small business multiplier announced at spending review 2013;

continued protection for authorities which froze council tax in 2014-15;

continued efficiency support grant funding for the small number of local authorities with the highest spending power reductions in 2014-15;

continued rural services delivery grant funding for the most rural authorities.

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The proposed 2015-16 settlement continues to deliver protection for funding to local authorities for learning disability, early intervention, homelessness and flooding, included in the settlement from April 2013, as set out in the summer 2013 consultation.

The settlement covers only around half of the substantial funding available to councils and the Government are balancing the reductions with a progressive package of incentives that will help deliver better outcomes for less money. We have recently announced the first instalment of plans to invest at least £12 billion in local economies in a series of growth deals. This money will go towards providing support for local businesses to train young people, create thousands of new jobs, unlock thousands of new homes and start hundreds of infrastructure projects including transport improvements and superfast broadband networks. We are also making available £15 million funding for 2014-15 and £305 million for 2015-16 through the transformation challenge award which is intended to encourage councils to achieve savings through joint working and efficiencies.

I have placed copies of the consultation document in the Library of the House, and the consultation document and a draft equality statement for the 2015-16 settlement are also available at: www.gov.uk/government/publications? publication_filter_option=consultations.

I have also made available today “The Pooling Prospectus” which sets out the benefits and procedures of pooling for those local authorities who wish to do so in 2015-16.

We look forward to receiving views on our proposals. The consultation period will close on 24 September 2014. We will then put forward our proposals for local government funding for 2015-16 to the usual local government finance settlement timetable.

Culture, Media and Sport

VisitBritain and VisitEngland (Triennial Review)

The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mrs Helen Grant): I am today announcing the start of the triennial review of VisitBritain and VisitEngland (British Tourist Authority). Triennial reviews are part of the Government’s commitment to ensuring that non-departmental public bodies (NDPBs) continue to have regular independent challenge.

The review will examine whether there is a continuing need for VisitBritain and VisitEngland’s functions and their form and whether they should continue to exist at arm’s length from Government. Should the review conclude there is a continuing need for the bodies, it will go on to examine whether their control and governance arrangements continue to meet the recognised principles of good corporate governance. The findings at both stages of the review will be examined by a challenge group.

Further details of the review, including how to submit evidence to it, can be found on the DCMS website at: https://www.gov.uk/government/organisations/department-for-culture-media-sport

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I will inform the House of the outcome of the review when it is completed and copies of the report of the review will be placed in the Libraries of both Houses.

Cabinet Office

Candidates' Election Expenses

The Parliamentary Secretary, Cabinet Office (Mr Sam Gyimah): The Government have made the following instrument: The Representation of the People (Variation of Limits of Candidates’ Election Expenses) Order 2014.

The order amends the maximum amounts of candidates’ election expenses at a parliamentary general election in the United Kingdom and at local government elections in England and Wales, to take into account inflation since these amounts were last changed in 2005.


School Funding

The Minister for Schools (Mr David Laws): I am today announcing the rates of the education services grant (ESG) in 2015-16.

The Chancellor announced in June 2013 that the Government would reduce the ESG by around £200 million in 2015-16. These savings help the Government to protect front-line budgets including the dedicated schools grant and the pupil premium.

We recognised in June 2013 that this reduction to ESG might require some local authorities and academies to deliver their services differently, and committed to consult on the detail of how the reduction could be implemented through realising efficiencies and enabling local authorities to focus on their core role on schools. This consultation has now been completed, and we have carefully considered the responses we received.

The ESG general funding rate will now be £87 per pupil. Local authorities also receive an additional £15 per pupil for the duties they retain for all pupils, including those in academies. The consultation evidence strongly suggested that we should not reduce this retained duty rate, and I am today announcing that the retained duty rate will remain at £15 in 2015-16. We know that these rates are sufficient to deliver the services covered by ESG, because in 2013-14 52 local authorities were planning to spend below this level to deliver those services. We have also today set out the clarification of duties that local authorities asked for to help them manage this reduction in spend.

In order to provide stability, academies receive transitional protection, and in the past they have also received a top-up on the ESG rate. We have said that over time the rates paid to academies and to local authorities should converge. I am therefore announcing today that in the academic year 2015-16 there will be no ESG top-up for academies, but that they will be protected from sharp falls in their budgets. The vast majority of academies

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will not lose more than 1.5% of their budget through this change, while higher funded ones will approach the new rate a little more quickly, with the very highest funded academies protected at just under 3% of their total budget. This strikes the right balance between making necessary savings to back-office services that will also make our funding system fairer, and ensuring that individual schools do not see unmanageable year-on-year changes in their budgets.

The Department received a large volume of responses to the consultation relating to the provision of music services. Many were concerned that any reduced local authority support for music services would impact on the overall quality of music provision and in particular on the opportunities for disadvantaged children.

We strongly believe that all children should benefit from a good music education and have given £171 million to music hubs since 2012. We have also announced today that central Government funding for music education programmes will increase by £18 million in 2015-16, and funding for music education hubs will rise to around £75 million in total. Local authorities will continue to have total discretion about whether to spend any of the ESG they receive on providing music services.

I will place a copy of the document I have published today in the Libraries of both Houses.

Energy and Climate Change

Future Fuel Poverty Framework

The Secretary of State for Energy and Climate Change (Mr Edward Davey): Since 2010 the number of households in fuel poverty in England has fallen every year, thanks to Government energy efficiency schemes and the warm home discount. However, the problem could rise again unless action is taken to tackle it.

In a package of announcements made today, the Government are setting out how they intend to act—taking the next major step forward in overhauling the framework to tackle fuel poverty in England.

We are laying draft regulations before Parliament to put in place a new long-term fuel poverty target. We have also launched “Cutting the cost of keeping warm”—a consultation helping us to prepare a new fuel poverty strategy to set out how we intend to achieve the target. In addition, DECC is publishing a report with the results of the first triennial review of the Fuel Poverty Advisory Group for England (FPAG), a copy of which I will be depositing in the Libraries of both Houses.

This package builds on a three-year period of detailed work on fuel poverty, which has changed our understanding of the problem and how we need to tackle it. This has included the independent Hills poverty review published in March 2012, a framework for future action on fuel poverty published in July 2013 and amendments made to the Warm Homes and Energy Conservation Act 2000 (WHECA) last year.

Fuel poverty target

The Fuel Poverty (England) Regulations 2014 set out the objective for addressing the situation of persons in England who live in fuel poverty, as required by section 1A of WHECA. The regulations will create in law a new fuel poverty target to ensure that as many fuel-poor

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homes as is reasonably practicable achieve a minimum energy efficiency standard of band C, by 2030.

I am also proposing to set out the following interim milestones in the new fuel poverty strategy:

as many fuel-poor homes in England as is reasonably practicable to band E by 2020

as many fuel-poor homes in England as is reasonably practicable to band D by 2025.

This target and the proposed interim milestones imply improving the energy efficiency standards of a significant number of households. In turn, this will mean a real change to these households’ living standards by reducing their fuel poverty gaps or removing them from fuel poverty altogether. Meeting the target will be a major challenge—not just for Government but for all those working to tackling this issue.


The consultation “Cutting the cost of keeping warm” seeks to explain how we will implement policy in a way that reflects our framework principles. This means trying to help those with the highest energy costs first and foremost, driving cost-effective interventions and supporting those most vulnerable to the effects of living in a cold home. We seek views on how we can improve the design and delivery of policy in order to try and meet the target. This focuses on four themes:

Warmer homes: cutting bills and increasing comfort in the coldest low-income homes to make a real and lasting difference with energy efficiency.

Supporting people: helping people directly with their energy bills and improving incomes.

Fairer energy markets: ensuring everyone can take action and benefit from a more open energy market.

Improving delivery: making the most of the support available, getting it to the right people, and working together to support the fuel-poor.

The combination of a long-term target and a strategy setting out our plans for achieving it will help ensure that the fuel-poor are not left behind as we meet our wider climate change obligations. At the same time, taking action to tackle fuel poverty will bring wider benefits, supporting jobs, saving carbon and improving health.

Governance and accountability

Meeting long-term targets requires effective governance and accountability. We are proposing regular reviews of progress and we intend to hold regular debates in Parliament on this issue.

For some time, the Fuel Poverty Advisory Group for England (FPAG), a DECC-sponsored advisory non-departmental public body (NDPB), has been a key part of the accountability framework. Today, we are publishing the results of our first triennial review report of FPAG1. This confirms FPAG’s critical role in scrutinising our strategy to keep us on track towards our target. But it also highlights there are opportunities to bring FPAG more in line with the best practice corporate governance standards for NDPBs.

We will be working with the current chairman, Derek Lickerish MBE, to implement these governance reforms over the coming months. This includes transitioning FPAG’s composition from organisational representatives to independent expert members.


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Fourth Carbon Budget (Review)

The Secretary of State for Energy and Climate Change (Mr Edward Davey): Today I can announce that, having concluded a detailed review, the Government will not be amending the fourth carbon budget. The budget, which covers the period 2023 to 2027, will therefore stay at its existing level of 1,950 million tonnes of carbon dioxide equivalent.

The decision I have taken is consistent with the advice of the Committee on Climate Change. It also reflects the views of the vast majority of businesses, investors and environmental groups.

The review was conducted in line with the commitment made by the Government when the fourth carbon budget was set in 2011, specifically that we would review progress in 2014 in order to determine whether the UK’s domestic commitments placed us on a different trajectory from the one agreed by our partners in the EU under the EU emissions trading system. In considering the evidence, I have paid particular attention to the requirements of the Climate Change Act and the process that this sets out.

Having conducted a detailed review, it is clear that the evidence does not support amending the budget. Any revision now would be premature, especially in light of the ongoing negotiations in the EU to agree a domestic 40% GHG reduction target for 2030 by October this year based on the Commission proposals published in January 2014.

As business groups have made clear, retaining the budget at its existing level provides certainty for businesses and investors by demonstrating Government’s commitment to our long-term decarbonisation goals. Our support for the UK’s energy intensive industries in the 2014 Budget underlined the Government’s continued commitment to protect the competitiveness of UK business. And, although I am clearly mindful of the risk that a misalignment between the EU and the UK’s trajectories in the traded sector might result in a disproportionate strain being placed on sectors not covered by the EU emissions trading system, the evidence does not indicate that action is required at the present time. Our current estimate is that UK and EU levels of ambition for the sector are likely to be extremely close over the period.

Above all, maintaining the fourth carbon budget at its current level demonstrates the UK’s commitment to its climate change target of an 80% reduction in emissions by 2050. The UK has the world’s most transparent system of binding emission reduction targets, which are used as a model throughout the world. Today’s decision cements the UK’s place as a global leader in combating climate change, which will allow us to play a central role in delivering a global deal to combat climate change at the end of 2015.

Foreign and Commonwealth Office

EU: Balance of Competences Review

The Secretary of State for Foreign and Commonwealth Affairs (Mr Philip Hammond): I wish to update the House on the progress of the balance of competences review that my predecessor launched on behalf of the Government in July 2012. I am pleased to inform the

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House that the third set of reports has been published today on the gov.uk website. As per the written ministerial statement of 23 October 2012,

Official Report

, column 46WS,

the reports were written by lead Departments for each policy area. This set of reports covers agriculture, cohesion policy, competition and consumer policy, energy, EU budget, fisheries, fundamental rights, the single market: financial services and the free movement of capital, the single market: free movement of services, social and employment policy, and the single market: free movement of persons.

Calls for evidence for these reports were published in May and October 2013. We saw a high level of interest and received over 800 pieces of written evidence from a broad spectrum of experts and interested parties including parliamentary committees, Members of Parliament, Members of the European Parliament, the devolved Administrations and Crown dependencies, business groups, think-tanks, academics, civil society groups and professional membership associations. The evidence we received was again of high quality and I would like to take this opportunity to thank all those who contributed.

As with semesters one and two, the reports have undergone rigorous internal challenge to ensure they are balanced, robust and evidence-based. Evidence submitted (subject to the provisions of the Data Protection Act) has been published alongside the reports on the gov.uk website to ensure transparency. With publication of the third semester, 25 of the 32 reports are now complete. By bringing all the evidence together in one place, the review enables people to judge for themselves how the current arrangements are working, as well as providing a valuable contribution to the wider debate on EU reform.

Calls for evidence for fourth semester reports were launched in March 2014 and closed in July. Reports in this final semester cover: economic and monetary policy; education, vocational training and youth; enlargement; information rights; police and criminal justice; subsidiarity and proportionality; and voting, consular and statistics. These reports are expected to be published by the end of 2014.

The third semester reports, along with the first and second semester reports and calls for evidence for semester four, are available at: https://www.gov.uk/review-of-the-balance-of-competences. Copies of the reports will be deposited in the Libraries of both Houses and hard copies are available in the Vote and Printed Papers Offices.

Government Diamond Office

The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mark Simmonds): Further to my statement to Parliament on 12 March 2014, Official Report, column 27WS, I wish to inform the House that today the Government Diamond Office has amended its charging structure, bringing it into line with the Government’s best practice on charging for services.

A public consultation on the review of the Government Diamond Office’s charging structure ran from 13 March to 27 March. The Government have given careful consideration to the responses received. We also considered

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the need to set our fees at a level which ensures that we have sufficient income to continue to provide this service, and the need to bring our charging structure in line with the Government’s best practice for charging for services.

The new single fee for the service of issuing a Kimberley process certificate will be £37 for the financial year 2014-15. This represents the full cost of providing this service. The previous charging structure was divided into bands based on the value of the rough diamond shipment.

The new fee comes into force today and will be reviewed annually. A copy of the results of the consultation and the updated statutory instrument will be placed in the House Library and on the gov.uk website.

Arab Partnership (Ministerial Correction)

The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr Tobias Ellwood): During the debate in Westminster Hall on 17 July 2014, Official Report, column 317WH, I incorrectly stated that there had been £65 million put into the Arab Partnership this year. This figure should be £50 million for the financial year 2014-15. The Arab Partnership Participation Fund (APPF) has £10 million to support the development of stronger civil society, Parliaments, media and judiciaries. The remaining £40 million is provided through the Arab Partnership Economic Facility (APEF), to support reforms that deliver jobs, boost economic growth and create effective and accountable institutions. We are investing an additional £65 million through the conflict pool in programmes to tackle conflict in the middle east and north Africa (MENA) region in 2014-15.

British Council (Triennial Review)

The Minister of State, Foreign and Commonwealth Office (Mr Hugo Swire): The Foreign and Commonwealth Office will today publish the triennial review of the British Council. The start of the triennial review was announced by WMS in July 2013. The review concluded that the British Council was a valuable asset to the UK in its promotion of the English language, UK education, arts and culture, making a significant contribution to the UK’s international standing. The review recommended that the British Council should be retained as a non-departmental public body.

To improve transparency and accountability, the review recommended that the British Council should strengthen its connections with UK Government Departments and other bodies representing British interests overseas. To address concerns around competition issues, the review recommended exploring alternative delivery models for commercial activity. To this end, a cross-Government steering group will start work, in July 2014, to assess options and make recommendations to Ministers about a future operating model.

Copies of the report of the review will be published online and placed today in the Libraries of both Houses.

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NHS England and the NHS Outcomes Framework

The Secretary of State for Health (Mr Jeremy Hunt): Today, I laid before Parliament my first “Annual Assessment of the NHS Commissioning Board (known as NHS England) 2013-14”. The “National Health Service Commissioning Board Annual Report & Accounts 2013-14” was also laid (HC408). Together they describe an organisation that has established itself and made progress in delivering the Government’s mandate, but has more to do to deliver all of its objectives. Copies of both documents are available to hon. Members from the Vote Office and to noble Lords from the Printed Paper Office.

The mandate to NHS England sets the Government’s ambitions for the NHS as well as the funding available to achieve and deliver the care people need and expect. The Health and Social Care Act 2012 requires the mandate to be reviewed on an annual basis to ensure that it remains up to date.

It has never been more important to provide the NHS with stability and continuity of purpose than now. And that is why the Government proposes to uphold all of the existing objectives in the current mandate, and maintain a stable mandate for 2015-16, to enable the NHS to build on its achievements and make further progress on the ambitious agenda already set.

Meanwhile, the challenges facing the NHS and wider health and care system for 2015-16 remain, with an ageing population and an increase in the numbers of people with long-term conditions. We want to see the NHS make further progress in transforming primary care to improve services for older people and those with the most complex needs, and on delivering a system-wide response to the Francis inquiry recommendations, while from 2015-16 joining up health and social care through the better care fund will be key to transforming care.

Within the stable mandate, as part of its existing objective to make progress towards parity of esteem for mental health, NHS England is working with the Department to fulfil its commitment to develop a range of costed options for new access and/or waiting time standards for mental health services, in order to implement these standards starting from April 2015, with a phased approach depending on affordability.

The NHS has generally been performing well and meeting demand despite increasing pressure on services. A stable mandate will allow the NHS to focus on maintaining its performance in providing high-quality, compassionate, and joined-up care now and in the future.

In addition, this summer we will be reviewing the NHS outcomes framework. The review has two aims: to update the framework for 2015-16 by improving, adding and removing existing indicators, and to indicate a direction of travel for future indicator development. Reviewing the NHS outcomes framework this year is also an opportunity to increase alignment between the framework and the objectives in the mandate given the commitment to stability for the mandate for 2015-16.

We have been working closely with NHS England on the approach to the mandate and the review of the outcomes framework, and will be engaging with stakeholders over the summer, ahead of publication in the autumn.

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NHS Modernisation (Costs and Benefits)

The Secretary of State for Health (Mr Jeremy Hunt): I announced in July 2013 that the costs of implementing policies in the Health and Social Care Act were likely to be closer to the estimate in the business case for the programme—£1.5 billion in today’s prices—rather than the £1.6 billion to £1.7 billion estimate reported in October 2012.

I can today confirm today that I am expecting the costs of NHS modernisation to be no higher than £1.5 billion.

Up to 31 March 2013, costs of £1,096 million had been incurred across the health and care system on developing and establishing the new arrangements. During 2013-14 organisations in the new system reported that they had incurred a further £220 million to continue this work. Some of these costs will relate to the continuous improvements that all organisations are expected to make. So, at most, the costs to 31 March 2014 were £1,316 million, comprising:

£456 million on staff redundancies;

£75 million on IT for the new organisations;

£88 million on estates costs of closing bodies and setting up new organisations;

£26 million on internal departmental costs—for example, programme management;

£323 million on setting up clinical commissioning groups—excluding items above; and

£348 million on other costs of closing bodies—for example, PCTs—and setting up new organisations.

In the impact assessment, long-term annual savings arising from the changes were estimated at £1.5 billion per year from 2014-15 onwards. Gross savings over the transition period—2010-11 to 2014-15—were estimated at £4.5 billion.

As I announced last year, annual savings are still expected to be £1.5 billion from 2014-15.

The reductions in administration costs up to 31 March 2014 are set out below. These are calculated on a basis consistent with the impact assessment for the Health and Social Care Bill—with the figures set aside any administrative spending on implementing the reforms.

2010-11£m2011-12£m2012-13£m2013-14£mTotal £m






The cumulative savings in administration costs arising from the reforms over the period 2010-11 to 2014-15 are therefore expected to be at least £6.4 billion.

Mitochondrial Donation

The Parliamentary Under-Secretary of State for Health (Jane Ellison): We are today publishing the Government response to the consultation about draft regulations to allow mitochondrial donation to prevent the transmission of serious mitochondrial disease from mother to child.

Mitochondrial disease is passed from mother to child through faults in the mitochondrial DNA. It is estimated that one in 6,500 children are born every year in the UK with a serious mitochondrial DNA disorder. Serious mitochondrial disease can have a devastating effect on

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families, including the premature death of children, painful debilitating and disabling suffering, long-term ill-health and low quality of life.

The consultation ran between 27 February and 21 May 2014. The consultation reached a wide audience and received 1,857 responses from research bodies, patient bodies, professional organisations, faith organisations, parliamentarians and a large number of individuals. We have carefully considered all responses in deciding how to move forward with the regulations, recognising that there is a broad spectrum of widely different views.

Although the purpose of the consultation was to invite views on the detail of the draft regulations, four out of five respondents simply expressed a view for or against the principle of mitochondrial donation. Where comments were made about the detail of the regulations, respondents were generally positive about the proposed individual provisions. The Government have taken the view that our policy position on the key issues remains the correct one. As such, we will:

retain the principle behind the definition of the mitochondrial donation techniques as currently set out in the draft regulations;

retain the provision that the Human Fertilisation and Embryology Authority (HFEA) would have to be satisfied that there is both a particular risk of mitochondrial abnormality and a significant risk that a person with that abnormality would have or develop a serious physical or mental disability, a serious illness or other serious medical condition;

retain the provision that the HFEA will consider each application on a case-by-case basis; and

retain the provision that the HFEA will release only non-identifying information about the mitochondrial donor to people born following mitochondrial donation when they reach age 16.

We will also include additional provisions in the regulations to clarify the consent requirements around the use and storage of eggs and embryos used in the mitochondrial donation techniques.

Alongside the consultation exercise, the Department also asked the HFEA to reconvene the expert panel to undertake a further, third, review of the efficacy and safety of the mitochondrial donation techniques. A report of that review was published in June 2014. The report found that the techniques of maternal spindle transfer and pro-nuclear transfer are potentially useful for a specific and defined group of patients and that the evidence does not suggest that these techniques are unsafe. The panel was of the view that research has progressed well since its previous two reviews, although it recommended that further experiments should be completed before clinical treatment is offered.

The Government have decided to proceed with putting regulations before Parliament, subject to giving further consideration to the expert panel’s recommendations, refining the draft regulations to take account of changes identified during the consultation, and discussion with the HFEA about an appropriate approval process. The Government will consider the timing of the regulations in the light of these actions.

The regulations will be subject to full scrutiny by the public and Parliament through the affirmative procedure.

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Home Department

Litvinenko Inquiry

The Secretary of State for the Home Department (Mrs Theresa May): I am announcing today the Government’s decision to establish an inquiry under the Inquiries Act 2005 to investigate the death of Mr Alexander Litvinenko in November 2006. The inquiry will be established by the Home Office.

The inquiry will be chaired by Sir Robert Owen, a senior judge who is the current coroner in the inquest into Mr Litvinenko’s death. Following consultation with Sir Robert, the terms of reference of the inquiry are:

1. Subject to paragraphs 2 and 3 below, the chairman is to conduct an investigation into the death of Alexander Litvinenko in order to:

(i) ascertain, in accordance with s.5(1) of the Coroners and Justice Act 2009, who the deceased was; how, when and where he came by his death; and the particulars (if any) required by the Births and Deaths Registration Act 1953 to be registered concerning the death;

(ii) identify, so far as is consistent with s.2 of the Inquiries Act 2005, where responsibility for the death lies; and

(iii) make such recommendations as may seem appropriate.

2. That investigation is to take into account the investigations which have already been conducted by the assistant coroner for inner north London.

3. In the light of the assistant coroner’s views, expressed in his ruling of 17 May 2013, that there is no material within the relevant documents to suggest that, at any material time, Alexander Litvinenko was or ought to have been assessed as being at a real and immediate threat to his life, the inquiry will not address the question of whether the UK authorities could or should have taken steps which would have prevented the death.

My right hon. Friend the Lord Chancellor and Secretary of State for Justice has written to the Lord Chief Justice asking that he suspend the current inquest in accordance with schedule 1 of Coroners and Justice Act 2009. The coroner and the widow of Mr Litvinenko have been given advance notice of this decision.

The arrangements for the inquiry will now be a matter for Sir Robert Owen. I am very grateful to Sir Robert for continuing to lead the independent judicial investigation into Mr Litvinenko’s death. It is more than seven years since Mr Litvinenko’s death, and I very much hope that this inquiry will be of some comfort to his widow Mrs Litvinenko.

Her Majesty's Passport Office

The Minister for Security and Immigration (James Brokenshire): Her Majesty’s Passport Office annual report and accounts 2013-14 has been laid before the House today and copies will be available in the Vote Office. Publication will take place shortly.

Terrorism Legislation (Annual Report)

The Secretary of State for the Home Department (Mrs Theresa May): Mr David Anderson QC has completed his fourth annual report as the statutory independent

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reviewer of terrorism legislation, on the operation of the Terrorism Act 2000 and Part 1 of the Terrorism Act 2006 in 2013. This report will be laid before the House today.

I am grateful to David Anderson for his thorough report and will, following consultation with other relevant departments and agencies, publish the Government’s response as a Command Paper in due course. At that time the response will be made available in the Vote Office.

Proceeds of Crime Act 2002

The Parliamentary Under-Secretary of State for the Home Department (Karen Bradley): My right hon. Friend the Secretary of State for the Home Department has today laid before Parliament the 2013-14 annual report of the appointed person under the Proceeds of Crime Act 2002. The appointed person is an independent person who scrutinises the use of the search power to support the measures in the Act to seize and forfeit cash used for criminal purposes.

The report gives the appointed person’s opinion as to the circumstances and manner in which the search powers conferred by the Act are being exercised. I am pleased that the appointed person, Mr Douglas Bain, has expressed satisfaction with the operation of the search power and has found that there is nothing to suggest that the procedures are not being followed in accordance with the Act. Mr Bain has made two recommendations which the Government will consider.

From 1 April 2013 to the end of March 2014 over £61 million in cash was seized by law enforcement agencies in England and Wales under powers in the Act. The seizures are subject to further investigation, and the cash is subject to further judicially approved detention, before forfeiture in the magistrates’ court. These powers are a valuable tool in the fight against crime and the report shows that the way they are used has been, and will continue to be, monitored closely.


Judicial Fees

The Lord Chancellor and Secretary of State for Justice (Chris Grayling): The Government would like to announce that as a consequence of the decisions by the:

(i) UK Supreme Court in O 'Brien v Ministry of Justice [2013] UKSC 6;

(ii) Employment Tribunal 2 Jan 2014 in Miller & Others v Ministry of Justice; and

(Hi) Employment Appeal Tribunal on 28 January 2014 in Ministry of Justice vO'Brien.

The fees payable to certain specified judicial officeholders have been increased. This change will take effect from 1 August 2014. A table of the affected judicial officeholders and their new daily fee rates has been placed in the Libraries of both Houses.

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Closed Material Procedure

The Lord Chancellor and Secretary of State for Justice (Chris Grayling): Section 12(1) of the Justice and Security Act 2013 (“the Act”) requires the Secretary of State to prepare (and lay before Parliament) a report on the use of the closed material procedure (CMP) under section 6 of that Act. Under section 12(4) of the Act, the report must be prepared and laid before Parliament as soon as reasonably practicable after the end of the 12-month period to which the report relates.

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I am pleased to submit the report in the form of the table below. An Unnumbered Act Paper, containing the same information, will also be laid today. Copies will be available in the Vote Office and in the Printed Paper Office. The report covers the period from 25 June 2013 (when section 6 of the Act came into force) to 24 June 2014.

Applications for a declaration that a CMP application may be made in proceedings during the reporting period


Made by the Secretary of State



Made by persons other than the Secretary of State


Applications for a revocation of a declaration made by a court that a CMP application may be made in proceedings during the reporting period


Made by the Secretary of State



Made by persons other than the Secretary of State


Declarations that a CMP application may be made in proceedings during the reporting period


in response to applications made by the Secretary of State during the reporting period



in response to applications made by the Secretary of State during previous reporting periods



in response to applications made by persons other than the Secretary of State during the reporting period



in response to applications made by persons other than the Secretary of State during previous reporting periods



of the court’s own motion


Revocations of declarations for CMP during the reporting period


in response to applications made by the Secretary of State during the reporting period



in response to applications made by the Secretary of State during previous reporting periods



in response to applications made by persons other than the Secretary of State during the reporting period



in response to applications made by persons other than the Secretary of State during previous reporting periods



of the court’s own motion


Final judgments which are closed judgments, given under section 6 Justice and Security Act 2013 proceedings (CMP) during the reporting period


Judgments made on the substantive trial.



Judgments made regarding the outcome of the application for a CMP declaration.


Final judgments which are NOT closed judgments, given under section 6 Justice and Security Act 2013 proceedings (CMP) during the reporting period


Judgments made on the substantive trial.



Judgments made regarding the outcome of the application for a CMP declaration.


(*) Two applications each covered two claimants; one application covered five claimants; and the remaining two applications each covered one claimant.

(**) One declaration covered two claimants; one declaration covered one claimant; and the remaining three declarations are outstanding (within the timeframe of this report).


Transport Resilience Review

The Secretary of State for Transport (Mr Patrick McLoughlin): At the beginning of March, following the extreme weather of winter 2013-14, I asked Richard

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Brown CBE, former chairman of Eurostar and now a non-executive director in my Department, to lead a review of the resilience of the transport network to extreme weather events. I am today publishing Mr Brown’s report.

I welcome this report and am grateful to Richard Brown and his fellow experts, Brian Smith and John Curley, for completing such a thorough analysis in time for the transport industry to consider the findings before the onset of next winter. The report considers the effects of extreme weather on roads, railways, ports and airports and makes some 60 recommendations for action by transport operators and central and local government. These range from short-term actions, such as those designed to improve basic maintenance of ditches, drains and vegetation, to longer-term recommendations, such as those on the economic signals and legislative provisions which have a bearing upon the resilience of our transport system.

As today’s report notes, transport operators on the whole responded well to last winter’s series of extreme weather events, but there were clear areas of weakness. I therefore welcome the practical measures identified to improve the transport network’s performance further at times of disruption.

Given the comprehensive nature of Richard Brown’s report, I propose to consider his recommendations in more detail and to publish a full response in due course. In the meantime, copies of the report have been placed in the Libraries of both Houses.

Work and Pensions

New State Pension

The Minister of State, Department for Work and Pensions (Steve Webb): I committed to publishing the proposed rate for increments derived from the deferral of a new state pension when I had advice on what would be an actuarially fair rate.

Earlier this year the Department commissioned the Government Actuary to provide a report on the actuarially fair rate of increments for those reaching state pension age on or after 6 April 2016 and choosing to defer their state pension beyond state pension age.

I am pleased to confirm the report has now been received from the Government Actuary. Following careful consideration of the information provided, the proposed new rate will be one-ninth of 1% for each week the state pension is not claimed. This means a 1% increase for every nine weeks of deferral or around a 5.8% increase for each full year.

It is my intention to bring forward draft regulations later this year, under the powers in the Pension Act 2014, which will set out the proposed rate. These regulations will be subject to the affirmative procedure.

In line with my commitment to the House, I will place a copy of the report in the House Library.

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Remploy Employment Services

The Minister for Employment (Esther McVey): The Department will be launching a commercial process for Remploy Employment Services, a leading national provider of disability employment services. This will give the company the opportunity for a partner or investor to help develop it to its full potential and help more disabled people get into work.

Over the last few years Remploy Employment Services has gone from strength to strength in the support it provides disabled people to find and remain in work. It is one of the Department’s key providers of specialist support for disabled and disadvantaged people. By March 2015, it is estimated that Remploy Employment Services will have supported over 100,000 disabled and disadvantaged people into work since 2010.

The Remploy board has expressed its desire for Remploy Employment Services to be given the opportunity to take on significant investment and the Department has been working with it to identify if there is opportunity to do this in line with the Sayce review recommendations. We both agree that there is now an excellent opportunity for an investor or partner to acquire a significant stake in Remploy Employment Services and invest in its continued growth and development. This opportunity will provide the freedom and flexibility for the business to continue to grow and expand its mission by helping even more disabled people find sustainable employment.

The commercial process for Remploy Employment Services will be launched in the next week through the normal commercial channels and further details will be available then.

This process is seeking a partner or investor for Remploy Employment Services who will hold a significant stake in the business. We envisage that a joint venture will be created and employees will hold an interest in the operation of the company.

This could be through some shareholding held on the employees’ behalf in an employee benefit trust. However the specific structure and governance arrangement linked to the creation of a company will be subject to the negotiation undertaken as part of this process and the Department is interested in any proposals which will deliver the key objectives of this transaction.

The Department will have a contractual arrangement with the new company to continue Remploy Employment Services’ national delivery of Work Choice and other Departmental contracts and agreements which are expected to be transferred as part of this process. The partner/investor will need to demonstrate the commitment, capacity and capability to continue the delivery of Work Choice and continue to grow the business in line with Remploy’s mission.

We will ensure that the Remploy pension scheme continues to be funded and that the accrued benefits of members are protected.

Our key priority during this process will be to ensure that Remploy Employment Services becomes an independent sustainable business which continues to support disabled people in finding and remaining in employment.

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Review of JSA Sanctions

The Minister for Employment (Esther McVey): In September 2013 Matthew Oakley was commissioned to undertake the independent review of the operation of jobseeker’s allowance sanctions validated by the Jobseekers Act 2013, as required by that Act. His report is published later today and I will publish alongside it the Government’s response.

The Oakley report says that

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“Benefit sanctions provide a vital backstop in the social security system for jobseekers”

and there is clear evidence that sanctions are effective.

The Government are, however, far from complacent and I believe it is important to improve the system so it continues to work effectively. I have already started to make improvements and will build on this work through the recommendations that Matthew Oakley has made within his review.

The Government welcome and accept all his recommendations.