3.14 pm

Kevin Brennan (Cardiff West) (Lab): It is a pleasure to serve under your chairmanship, Dr McCrea. I congratulate the hon. Member for Christchurch (Mr Chope) on securing the debate and on his thoughtful and important contribution, in which he sought to outline the experience of a school in his constituency of going through the Ofsted inspection process.

I intervened on the hon. Gentleman earlier about the school’s exam history, and it would have been helpful had he been able to tell us a little more about it. Perhaps the Minister knows the details and can tell us whether it was a factor in Ofsted’s judgment. Nevertheless, the hon. Gentleman raised some important issues.

The hon. Gentleman made the important point that, in making serious judgments about the quality of schools, we should not forget the wider aspects of schools or the wider curriculum. I certainly agree that no school should be able to be rated as outstanding unless it has a broad and balanced offer for its pupils, including an excellent cultural offer. Perhaps we need to think more about that, and I might say more about it later.

The hon. Gentleman mentioned the Trojan horse affair in Birmingham. I do not intend to go through it in any great detail again today, but it would be useful if the Minister told us his view of what has happened since the Trojan horse affair, and of how Ofsted is inspecting schools in the light of the newly introduced need to teach British values in the aftermath of that affair. If he could update us on the Department’s view of how that is going, that might benefit the House and would certainly relate very much to Ofsted’s accountability, which is the subject of the debate.

I congratulate my hon. Friend the Member for Blackley and Broughton (Graham Stringer) on his contribution. He expressed concerns about the quality of inspections of children’s services in Manchester. He made some important points about safeguarding and the failure of inspections sometimes to pick up problems with safeguarding children. Those are serious issues, and the Minister will have taken those remarks on board and will want to say something about them.

I congratulate the hon. Member for Wells (Tessa Munt), who was born on the same day as me, although she looks a lot younger. She raised a serious constituency issue, which should be the subject of a formal complaint. I am sure that she, as a constituency MP, will take that up directly, but it would be useful to hear the Minister’s response.

As many Members here know, I used to be a teacher, so I have been through the process of being inspected, albeit not under the current dispensation. I can tell Members, and any teacher will agree, that it is not necessarily a pleasant experience, but it is a necessary experience. I absolutely accept that inspection forms an important part of the process. Before the Minister starts looking up how I did in that inspection, let me say that I was perfectly happy with how it turned out.

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We should acknowledge that inspection is a stressful process and that head teachers, teachers and even pupils and parents can find it stressful. Although inspection is an extremely necessary process and must focus forensically on ensuring that children are not being failed in our system—a principle that the Opposition absolutely support—we should bear in mind the human side of things when schools are inspected.

One of the sad things about discussions of Ofsted is that they are very much based on the headlines we tend to see in the newspapers when things such as the Ofsted annual report are published. Very few people read beyond the headlines and into the detail of what the chief inspector says in his report. People tend to take up political positions on what has been said, but Sir Michael Wilshaw made some extremely sensible remarks in his commentary on the annual report, some of which are things we have known for a long time, such as that for a school to be outstanding it needs great leadership. It is also necessary for it to have great middle-level leaders; and that depends on the great senior leadership. We could do a lot more to strengthen the role of middle leaders, particularly in secondary schools. Sir Michael said in his report today that he is concerned that they are not making progress and that more children are being taught in schools rated inadequate. The necessary things include good leadership and good teachers, effective and accurate assessment, and dealing with such things as low-level disruption.

As a former teacher I do not think it is really possible to teach without first creating a quiet, orderly environment. Beyond that, many things are possible and teachers can move on to all sorts of innovative and interesting activities; but it is and always has been the starting point—the basis and foundation of the craft of the classroom. I would not go as far as saying, as we used to when I was teaching, “Never smile until Easter,” but it is necessary to establish the proper quiet and orderly environment in a classroom if a teacher is to teach effectively and make sure that learning happens. I understand why Sir Michael is concerned about low-level disruption; about the stretching of able pupils; about many schools’ failure to do enough to narrow the gap between disadvantaged pupils and those from better-off backgrounds; and—topically, after the Government’s announcement today—about the current poor careers advice in schools, which is almost universally accepted, except by the Department for Education, to have worsened significantly since 2010.

Perhaps the Minister will expand a little further on today’s announcement about the new careers company—particularly why it was not put out to tender and how the choice was made to give a particular sum of money to a particular individual and group to run it. I should be interested to know what thinking was behind that. Was it to do with the time it would take to get that done before purdah, or was there a genuine operational, strategic reason for doing things in that way instead of by the normal governmental tendering process? The Public Accounts Committee might be interested to know about that.

Sir Michael Wilshaw also talked about governance not being strong enough. We all need to listen to that, and to address the issue. He also flagged up a severe concern about teacher supply. I know the Minister is

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interested in that, and he noted the 17% fall since 2010 in the numbers entering initial teacher training. I should be interested in his view of Sir Michael’s remarks. Does he agree that teacher supply is an emerging issue, and if so what will he do about it?

Under the present Government there have been problems relating to the proper relationship between the Department for Education and Ofsted. Indeed, there have been accusations of an attempt by the Department to politicise Ofsted in the current Parliament, not least because of the sacking of its chair, Sally Morgan, and the memo from senior advisers to the former Secretary of State suggesting that it might be right to sack Sir Michael Wilshaw. Those revelations have led to accusations by people speaking on behalf of the Schools Minister—he is here this afternoon—of a Government attempt to politicise Ofsted. The report of 9 October in The Guardian said:

“A Liberal Democrat source close to schools minister David Laws said: ‘The fact is that, Gove, Cummings and others around them have been deeply disappointed by Michael Wilshaw’s refusal to play ball. This is almost certainly what lay behind their previous attempt to politicise the inspectorate.’”

So that is confirmation from the Schools Minister, or rather his spokesperson, whom he might perhaps want to identify—it might have been him; I do not know, but whoever the source close to him was, I am sure he would like to tell us—that the previous Secretary of State and his advisers have been involved in an attempt to politicise Ofsted. Of course, that is a dangerous path to take, so when the Minister talks about the accountability of Ofsted, perhaps he will tell us how he valiantly fought off the attempts in his Department to politicise it, who was involved in them, and what he is doing to rein in that tendency in the Department.

That is not to say that Ofsted is a perfect organisation, as anyone would admit. Concerns are frequently expressed to Ministers, shadow Ministers and others. We have heard in the debate some of the concerns about the way Ofsted inspections are carried out. We need to think about how to move on and reform it. It might help if I say something about Labour policy on Ofsted. The Opposition recognise that school inspections play a crucial role in upholding standards in schools, but we oppose the Government’s attempts to politicise Ofsted, which the Schools Minister has complained about, because they would ultimately undermine the integrity and independence of the schools inspectorate. National systems of inspection and accountability should be collaborative rather than confrontational—an issue that perhaps contributes to some of the concerns expressed in the debate. Otherwise, the effect of inspection could too often be to narrow children’s educational experience.

We need to prevent that from happening. We want schools to be innovative; we do not want them to operate in an accountability framework that makes them fear innovating, developing new pedagogies and using new technologies. Of course they must meet the requirements on standards, but we do not want an atmosphere in which schools always play a conservative part. We want innovation and we need pedagogies to be developed. We need to use and unleash the talents of teachers in what Ofsted called in 2010 the finest generation of teachers we have ever had in this country—albeit one dreadfully undermined by the Government’s disastrous policy, with which I understand the Schools Minister also disagrees, of allowing unqualified teachers in schools.

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Labour believes that the role of the schools inspectorate needs to be examined. In government we will ensure that the inspection process is more collaborative and that school improvement involves schools reviewing one another, and monitoring by the middle tier. We have talked about creating directors of school standards to clear up the muddle that has occurred since the present Government’s piecemeal, rapid and politically motivated timetable of academisation. What Sir Michael Wilshaw said today about the obsession with structures, rather than the things that really matter for school improvement, was extremely helpful. The name over the door does not matter. What matters is the quality of leadership and teaching in a school, not the name and title. An end to a Government-favoured brand of school will be a positive step forward, and I am glad that Sir Michael said what he did.

Mr Chope: On that point, does the hon. Gentleman accept, on behalf of the Labour party, that there should not be an obsession with being for or against academies, free schools or maintained schools, but that we should look at each school on its merits?

Kevin Brennan: Yes, I accept the hon. Gentleman’s proposition that each school should be considered on its merits, but we should be creating a framework of fairness within which schools of all types and denominations can operate, with a fair and proper admissions procedure, an effective admissions code and a stronger adjudicator on admissions, to ensure that schools are operating together in a collaborative framework. We do not believe in using naked market forces to drive schools out of business. We believe in weaker schools being helped by stronger schools in the system and insisting that such collaboration must happen, because ultimately that is how an increase is standards is achieved. That is what happened under the framework of London Challenge, for example, through a collaborative approach, rather than relying on creating an over-supply to drive schools out of business and, ultimately, putting pupils in ever-failing and declining schools over time and ruining their lives with an obsession with market forces. Unfortunately, that certainly was the philosophy of the previous Secretary of State and some of his closest advisers.

We will ensure that there is more collaborative work on school improvement, involving schools reviewing one another and monitoring by the middle tier; we have talked about creating directors of school standards, as well as the national inspectorate. We will ensure that early years settings and primary schools are judged against how well they develop children’s knowledge, skills and qualities through a broad and balanced curriculum, alongside tests in English and maths. We have already called for Ofsted to have the power to inspect academy chains and we are committed to monitoring its role. That confirms what I said to the hon. Member for Christchurch: we want the same treatment for all schools, so that, as well as inspecting local authorities, which may have responsibility for groups of schools, Ofsted can inspect not just individual schools in an academy chain but the operation of the chain itself.

I hear concerns that schools in some academy chains have less autonomy and are given directions from head office about exactly what they have to do. That head office is sometimes in a remote part of the country, far

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away from where the school is operating. Those schools’ policies are being determined from far away and there is little accountability in the system, so inspecting academy chains is important. I hope the Schools Minister agrees. We were not able to persuade the previous Secretary of State or the current one to permit that, but Sir Michael Wilshaw has asked for it and we support it. I hope the Schools Minister confirms that he supports that, too, because he seems to support an awful lot of what we say nowadays about schools and education policy, in contrast with his colleagues in the Department for Education.

Does the Minister agree with Sir Michael Wilshaw, who said today that in the last couple of years 70,000 more pupils are being taught in inadequate secondary schools? If so, what is his policy response and how should we deal with it? Obviously, if that is so—I have no reason to believe that the chief inspector of schools is wrong—there needs to be some policy response. It is not adequate simply to say, “Our academisation programme and our free schools policy will solve all problems”, because we know that is not true. What are we actually trying to do to put that right? It is a challenge to all of us, if such a process is occurring.

I recognise the improvements made by many schools in recent years, under this Government and the previous one, and their raising of standards. That is to be celebrated and commended but it is down, principally, to the hard work of school teachers, school leaders, governors and others, probably far more than to politicians and education policy makers, who often have little experience of the front line—the classroom—and more experience of policy think-tanks. However, if over the past couple of years 70,000 more pupils are being taught in inadequate schools, the Government should be concerned about that and should have something to say about it. I hope that the Minister has.

Will the Minister update us on what is happening about accusations that the Inspiration Trust in Norfolk was given prior notification of inspection? As has been said, this system has to be fair across the country and everybody must have the same notification—or no notification—of inspection. I am sure that Members would be grateful for any information the Minister could provide to update the House.

Will the Minister comment on the following, from an article in The Guardian on Tuesday 9 December?

“In September 2013, an Ofsted stipulation that inspectors should ‘consider the food on offer at the school and atmosphere of the school canteen’ was introduced, following pressure from organisations including the Jamie Oliver Foundation. But this August, it I was quietly removed, in a streamlining of inspection guidance. Ofsted’s latest consultation on a new inspection framework, which closed last Friday, has also omitted to mention school food.”

I know the Minister has a genuine interest in this subject. Can he shed any light on whether there is to be a dilution of the inspection of the quality of school food?

What does the Minister think of the following remark by Sir Michael Wilshaw in the annual report?

“The proportion of secondary schools in which leadership and management are judged inadequate has…doubled over the past two years.”

Again, that should be of direct concern to the Department. Does the Minister agree with and recognise Sir Michael Wilshaw’s observation? If so, what is his response and what does he intend to do about it?

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Dr William McCrea (in the Chair): Minister, before I call you, although I am sure there could be a temptation to go into the wider education debate, I have to remind you that the parameters of the debate are the accountability of Ofsted and we have to keep to those.

3.37 pm

The Minister for Schools (Mr David Laws): It is a pleasure to serve under your chairmanship, Dr McCrea, and I will certainly follow your wise advice, in spite of the temptations of the shadow Schools Minister to draw me off into all sorts of other areas.

I congratulate my hon. Friend the Member for Christchurch (Mr Chope) on raising this issue, giving us an opportunity not only to address the issue of his local school, but to reflect on the accountability of Ofsted and the appeals processes that our schools inspectorate operates under. He has also, as he said, given us an opportunity to touch on issues arising out of Ofsted’s annual report published today, within the constraints of the debate.

I think that, by and large, Ofsted does a difficult job well, and most hon. Members would recognise that. It is a job that is necessary. Few of us would want to go back to 30 or 40 years ago, when the oversight and accountability of the school system was much weaker and, as a consequence, there was a risk that underperforming schools could continue, failing their local communities and young people for long periods. We certainly do not want to go back to that. Ofsted is a good organisation and the current chief inspector is one of the best we have had. Of course, the Government will reflect carefully on the annual report and the comments the chief inspector made today on its launch.

I should also say, as I believe the chief inspector said on the “Today” programme this morning, that Ofsted carries out some 30,000 inspections every year, not only of schools but in other settings. The chief inspector will be the first to acknowledge that when carrying out inspections in such a number of settings, there are bound to be imperfections in a small minority of cases. It is important that we ensure that, where there are issues, those are taken seriously and dealt with. Of course, we need to make sure that the overall quality of the inspection process is as high as it can possibly be.

My hon. Friend the Member for Christchurch and others who have participated in this debate have pointed out that the judgments made by Ofsted are important and have big consequences for people’s livelihoods, schools’ reputations and the decisions parents take. In fairness to parents and schools, it is therefore important that we get those judgments right. If we err on the side of generosity in any judgment, that has serious consequences. We could end up with schools not doing well enough and failing their local communities for long periods and, as the hon. Member for Blackley and Broughton (Graham Stringer) mentioned, what is important in the schools system is even more crucial in safeguarding. We should be fair to all those involved in that important work, but we should be rigorous in our inspection to ensure that vulnerable young people are not at risk.

I apologise to the hon. Gentleman, because I did not know he was going to raise issues on children’s services and safeguarding. I am not the lead Minister on that issue in the Department; the Minister with responsibility

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for children, my hon. Friend the Member for Crewe and Nantwich (Mr Timpson), will have been particularly involved in the oversight of some of the services in Manchester and elsewhere, but I will write to the hon. Gentleman following the debate to follow up on some of the points he raised.

Before coming back to the points raised by my hon. Friend the Member for Christchurch, I will respond briefly to my hon. Friend the Member for Wells (Tessa Munt), who raised concerns about information that her constituent gave Ofsted anonymously to inform the inspection of a school. I am sure that the chief inspector would take the same view as me and her—that information given anonymously should be treated in that way; the source of that information should not be revealed to the institution being inspected. I am concerned to hear that there may have been an instance where privacy was not respected. I will look into that. I will see the chief inspector shortly, and I will raise the issue with him and ask whether he can look into it, if my hon. Friend can give me the details—in confidence, of course—of her constituent and the circumstances.

I will pick up on a number of the points that the shadow Schools Minister raised, but specifically on accountability and the situation in Norfolk, I can update him and the House by saying that the fresh independent review ordered by Sir Michael after questions were raised about the earlier inspection is under way. We expect that review to be completed by the end of the year.

I will touch on the annual report, and then I will comment on Ofsted’s inspection and appeals process. I will then touch on Ferndown school, which my hon. Friend the Member for Christchurch mentioned. Today’s annual Ofsted report on schools provides a timely reminder of the importance of Ofsted’s inspection work. Earlier today, the chief inspector announced that good and outstanding schools now account for 81% of all schools inspected, up from 68% in 2010. We should all acknowledge that that is a significant increase. In spite of some of the concerns about secondary schools, that is the highest proportion of good and outstanding schools at any time since Ofsted was set up. Primary schools, as the chief inspector mentioned this morning, have done particularly well, with 82% now good or outstanding, which means that 190,000 more pupils are in good and outstanding primary schools than last year. That is 700,000 more than in 2012, and we should celebrate that.

The report also shows that schools are responding positively to inspection. Two thirds of schools that were previously judged as requiring improvement secured good or outstanding on re-inspection this year. There is also positive news on the performance of pupils from lower-income backgrounds. The disadvantage gap, particularly in primary schools, is closing rapidly. All that means that more than 1 million more pupils are in good or outstanding schools than in 2010. While much of the credit for that must go to hard-working individuals in schools, we believe that inspection is also contributing to the improvement in the system.

The shadow Schools Minister mentioned the less encouraging recent statistics for secondary schools. Significantly more work needs to be done to ensure that improvement is maintained in the future, rather than schools remaining at existing levels. The percentage of

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secondary schools graded good or outstanding is up from 68% in 2010 to 71%. The number of pupils of secondary age being educated in schools in the secondary sector classed as requiring improvement or inadequate dropped from 1,073,000 to 793,000 last year, which is encouraging.

The inspection and regulatory functions of Ofsted are vested in Her Majesty’s chief inspector, who is primarily accountable directly to Parliament. He appears before the Education Committee at least twice a year, giving evidence on the work of Ofsted and on his annual report. He is also subject to other parliamentary scrutiny. As recently as last month he appeared before the Public Accounts Committee, so there are many parliamentary opportunities for the work of Ofsted to be examined. The Education Committee can also conduct inquiries specifically into Ofsted and its work. In April 2011, the Committee conducted an inquiry into the role and performance of Ofsted. The report from that inquiry concluded:

“Ofsted’s independent status is broadly valued by inspectors, by professionals, and by the public, and we strongly support the retention of that status.”

As the Department for Education is the lead policy and ministerial Department covering Ofsted’s work, the Secretary of State for Education meets the chief inspector regularly, as do I, to discuss the work of Ofsted.

Every year Ofsted conducts approximately 6,500 school inspections and 30,000 inspections of all settings. It has a massive job of work to do. As part of its procedures, Ofsted sends out a feedback questionnaire after every inspection. The latest figures for the second quarter of 2014-15 show that 93% of respondents said that they were satisfied with the way an inspection was carried out. That is against an overall response rate of 71%, which indicates that in the majority of settings, there is contentment on the effectiveness and fairness of the Ofsted process. As good as those figures are, there is no room for complacency.

I assure my hon. Friend the Member for Christchurch that Sir Michael takes particular interest in the quality of inspectors’ work. He recognises—I believe he has said this publicly—that more needs to be done to ensure that all inspections are delivered to a consistently high standard the first time around. That is why he appointed Sir Robin Bosher, one of Ofsted’s directors, to take direct responsibility for inspection quality and the training of inspectors. As a result, Ofsted has put in place more stringent quality checks and monitoring of inspections and reports. It has also invested more in the training of inspectors, in place of having detailed written guidance documents. I know that Sir Michael is working hard to ensure quality and consistency, and I am confident that he will tackle any underperformance in the inspection work force. He is prepared to take tough action where necessary to remove inspectors, or to require additional training where inspectors fail to meet his high expectations.

Looking ahead—my hon. Friend the Member for Christchurch mentioned this—Sir Michael has announced that he will bring the management of inspections, including all inspector training, in-house from September 2015. As part of the programme, Ofsted will change how it sources and selects additional inspectors, and how it trains, contracts with and performance-manages them. Much of that is currently arranged through contracts

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with three inspection service providers: Tribal, Serco and CfBT. Under the planned changes, however, all complaints will be handled directly by Ofsted.

Another important step in trying to improve the quality of inspections is making more use of serving practitioners—something to which Sir Michael Wilshaw is committed. The latest figures from Ofsted show that 56% of school inspections include at least one serving practitioner, which could be a head teacher or a senior leader from a high-performing school. That is up from just 15% in 2011, so there has been a massive increase in the involvement of serving practitioners. Many of them are also national leaders of education and play a wider part in the overall leadership of the school system.

I will briefly turn to how the Ofsted complaints procedure works. I appreciate that this might seem unnecessarily detailed, but as it is at the centre of my hon. Friend’s concerns, it is important for me to set out just what the process looks like and to consider whether it needs any change.

Ofsted has a clear, published complaints procedure. During an inspection, those with concerns are strongly encouraged to raise issues with the lead inspector as soon as they arise. If a complainant feels unable to raise concerns directly with the lead inspector during the inspection, they can contact the Ofsted helpline directly. If concerns have not been resolved, a formal complaint can be raised with Ofsted within 10 working days of the incident of concern. If the concern is about an inspection, the complaint should be made no more than 10 working days following the publication of the report. When Ofsted receives the complaint, it will investigate and send a written response to answer the agreed main points of concern within 30 working days. It does not normally withhold publication of an inspection report or withdraw a published inspection report while it investigates complaints unless there are exceptional circumstances.

There is a second, appeal stage to the complaints process. If a complainant remains dissatisfied, they may appeal to the Independent Complaints Adjudication Service for Ofsted, which my hon. Friend the Member for Christchurch mentioned. The Centre for Effective Dispute Resolution has been appointed by the Secretary of State to undertake that important role. If complainants are not satisfied with the outcome of the adjudication service review, they can contact the parliamentary ombudsman. That is quite a prolonged process, and I appreciate my hon. Friend’s comments about the ombudsman’s potential role and the time that such things can take, but it is relevant that in 2013 only 12 cases concerning schools were referred to the independent complaints adjudication service, which is a small proportion given that Ofsted inspects approximately 6,500 schools a year. That suggests to me that the number of schools that are seriously concerned about the quality of their inspections is relatively small.

Mr Chope: Might not another explanation be that schools realise that ICASO cannot really do anything? All that it can do is look at the process rather than the substance.

Mr Laws: It might be that my hon. Friend would seek to put that construction on it, but that is unduly pessimistic, not only because the appeals process has previous stages,

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but because a body that seeks to escalate a complaint to the independent complaints adjudication service can seek to raise concerns about the substance—although they may appear to be addressed to the process—if it feels that aspects of the inspection process have not been respected. I will return to that with regard to the school mentioned by my hon. Friend in a moment.

The independent complaints adjudication service also reported that it saw an improvement in the quality of Ofsted’s complaint handling from previous years. All but four of the general recommendations made to Ofsted were accepted fully, with the others being accepted partially.

I know that my hon. Friend has exchanged correspondence with the chief inspector and Ofsted’s south-west regional director, Bradley Simmons, about the inspection of Ferndown upper school in January 2014. My hon. Friend is concerned that the school was graded inadequate, with serious weaknesses. I note that the inspection reported several areas of concern, including that students were not making enough progress, especially in English, that work set was not suitable for the least or most able students, that progress was too slow for students eligible for the pupil premium, for boys and for students with special educational needs or disabilities, that fixed-term exclusions and persistent absence figures were too high and impacting on the progress being made by those pupils, that sixth-form students were not making enough progress and that leaders, including governors, were not tackling weaknesses quickly enough.

As Schools Minister, I cannot comment personally on all those judgments, as my hon. Friend will understand. However, I can reflect on the data and what they indicate for the school. At the time of the inspection, the proportion of students gaining five good GCSE passes, including English and mathematics at grade C or above, had been significantly below the national average for three years. It was 47% against 58% in 2011, 49% against 59% in 2012 and 50% against 60.6% in 2013. As I understand it, the school has a lower than average number of pupils from disadvantaged backgrounds in receipt of, for example, the pupil premium. GCSE English language passes at grade A* to C were 69% against the national average of 82%. Attainment was significantly below the national average in nine curriculum areas, and above in just two. Just 59% of students made expected progress in English against 69% nationally. I will not comment on the precise judgments in the Ofsted report, but we should reflect on the fact that data do suggest that the school has performance issues and challenges.

On accountability, I know that the school followed Ofsted’s published complaints procedure. The head teacher complained about the outcome of the inspection. His complaint was investigated by the inspection service provider, Tribal, but was not upheld. He requested that his complaint be elevated, and a further investigation was undertaken by Her Majesty’s inspectors to ascertain whether the original had been fair and thorough. The outcome of the original investigation was validated. The head teacher then took his complaint to the Independent Complaints Adjudication Service for Ofsted. The adjudicator reported that Ofsted had

“addressed the complainant’s concerns in significant detail and in a fair and reasonable manner”

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and went on to say:

“I do not find that I can provide any advice or make any recommendations to further improve Ofsted’s practices for dealing with complaints in this instance.”

Picking up on some of the concerns that the school raised about being marked down for attendance, I understand that the investigation into the complaint found that inspectors had considered the school’s own attendance data alongside those available nationally. That is correct procedure. Inspectors should use RAISEonline as a benchmark and should ask questions as necessary. The response to the school’s complaint mentioned there being no national comparison data on attendance rates for sixth forms only.

Mr Chope: On that point about no data being available, that is not correct. Does my right hon. Friend accept that?

Mr Laws: The response to the school’s complaint mentioned there being no national comparison data on attendance rates for sixth forms only, but attendance data are available and show that, although improving slightly recently, persistent absence has risen for girls and for some students with special educational needs. It has fallen for students eligible for free school meals, but remains seven points above the national average as in 2013.

Attendance is not a separate judgment and does not alone determine the behaviour and safety judgment. A school cannot be marked down for its attendance statistics alone, and this particular school was not. Behaviour and safety were judged not to be inadequate, but to require improvement. My hon. Friend is concerned that performance data should be correctly assessed in a local context, but while local comparisons are important, Ofsted makes comparisons on attainment and progress against national data, taking account of pupils’ prior attainment. That is clearly set out in the inspection handbook, so it should not come as a surprise to any school. If one looks at the attainment data, it is clear that the school has some questions to answer about its performance against comparable national figures.

I understand that Ofsted has undertaken two monitoring inspections of the school, in May and September, since the original inspection. The first visit found that the school was planning appropriate action for improvement, supported by the local authority. The second visit judged senior leaders to be making reasonable progress towards the removal of serious weaknesses. However, it also found that school leaders lacked rigour and urgency in their approach to improving the school. While recognising improvements, Her Majesty’s inspectorate found that

“the school lacks a consistently rigorous and relentless focus on improving the achievement of those students who could, and should, do better, regardless of their background, ability or starting point”.

We should expect all schools to serve the interests of all pupils.

It is important to remember that, for the vast majority of schools, the current inspection system works well. I would, however, encourage any school that feels that its inspection has fallen short of normal expectations to raise its concerns with Ofsted at the earliest possible opportunity, as many have done. However, the chief inspector’s decision must be final if inspection is to

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remain credible. Without that, every school that disagreed with the judgment would seek to challenge the outcome of its inspection, delaying critical action to start to bring about improvement for the children at the school who, after all, will not get a second chance.

I hope that I have demonstrated that there are many stages in the process of scrutinising an Ofsted decision. In fact, the only way that we could really meet my hon. Friend’s requirement for an additional degree of scrutiny would be to have another school inspection service. There is no evidence at present that that would be value for money given the overall level of complaints. We will, however, keep a close eye on the issue and seek to improve the quality of inspections in future.

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Mental Health (Cambridgeshire)

4 pm

Dr Julian Huppert (Cambridge) (LD): It is a pleasure to serve under your chairmanship, Dr McCrea. I am delighted to have secured this debate on a key issue for my constituents: health care and in particular mental health.

Our national health service is something to be proud of, the brainchild of a great Liberal, Beveridge, and brought into being by the pioneering Labour Government after the second world war. It is an amazing institution, providing care for all of us, free at the point of use. I pay tribute to the excellent and tireless work of NHS staff—and incidentally, I hope the Government will ensure that they are paid appropriately, because independent pay recommendations should be honoured.

Our NHS is, however, not perfect and is under strain. During debates when it was established, the predictions were that it would run more cheaply every year as people became increasingly healthy. In fact, the opposite has happened. People live longer because we are learning to treat more and more conditions, but that costs us more and more. Demand grows rapidly, the range of things we can do increases and NHS inflation outstrips standard inflation, leading to huge cost pressures. Much of the solution lies in preventive measures, because it is of course cheaper to keep people healthy than to treat them when they are not, but we never spend enough money on that as it is so often needed for treatment.

Some areas are shamefully neglected. Mental health in particular has always been left behind. A lot of that is a product of historical, outdated social attitudes—questions of shame, how people ought to be and what was “normal”. Indeed, many believed that mental health problems were a deficiency of character. That is of course rubbish, and I do not think anyone in the House would share such a view today. Nevertheless, a stigma that simply should not be there is still attached to mental health conditions. People are not prepared to talk about mental health, to admit problems or to seek help.

The stigma not only causes anguish for many people and their families, but materialises in discriminatory policies. For example, when the previous Government introduced waiting times in our NHS—arguing, perfectly reasonably, that that would improve provision for cancer patients and mean they were not left waiting for treatment—the Government did not include mental health. It was almost taken for granted that mental health delays were less important than physical health ones. Funding bodies reacted, pulling more money away from mental health in order to hit the new targets in physical health, which was an understandable reaction.

I am glad that that policy era is over. We have now legislated for parity of esteem between physical and mental health. Thanks to the excellent work of the Minister of State, Department of Health, my right hon. Friend the Member for North Norfolk (Norman Lamb), we are introducing the first ever waiting-time standards for mental health next year, described by charities as a watershed moment, although far too late in coming. Other improvements include the recent provision of £150 million to tackle eating disorders, but we have to go much further, because people are suffering and simply cannot wait.

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On Saturday, I was at the wonderful Mill Road winter fair. We had a Lib Dem stall, where we were asking people to come and talk to us about mental health, to get some information and to sign a petition supporting our call for an extra £500 million for mental health, which I reiterate today. Huge numbers wanted to sign—many people care about the issue—and we raised lots of money for Centre 33, which helps to provide free and confidential counselling and support for young people.

We also heard some astonishing tales. Let me paraphrase just one of the stories of one of the people who came by, a woman who had felt suicidal for a year and had no fixed address. She went to see a GP, who asked her to come back regularly to check that she was okay. She went for a bit, only to stop going, but that triggered no alarm bells, even though a suicidal patient who was being monitored had stopped showing up. Eventually, she went to another GP and was told that she would be referred to a community mental health team, but nothing happened. Some time later, a third GP also suggested referral, but found nothing in her notes to suggest that she ever had been referred before. Three months after seeing the first GP, she was finally given an appointment to see a psychiatrist, but it was in five months’ time. The appointment happened and she was put on an 18-month waiting list for therapy. She is still on that list. In the meantime, she has lost her job and is in an extremely difficult situation. No wonder she and many others say that we need change.

Such a situation is not new. Eight years ago, my predecessor David Howarth spoke out against £3 million of cuts to mental health services in Cambridgeshire that led to the suicide of Julie Deloughery. There are many such stories across the country and across the decades. I heard some more when I worked with service users at Lifeworks, a mental health drop-in centre in Cambridge. The centre was threatened with closure, which I am delighted has now been stopped. I am proud that I was able to help with that by talking to service users and the mental health trust, and by raising the issue in Parliament, but I am far prouder of the work done by service users themselves and their friends. In particular, I pay tribute to Ann Robinson for her efforts. Too often, things are done to people with mental health issues, rather than done with them.

The now reversed decision on Lifeworks was partly the result of funding problems, so let me focus on the funding situation in Cambridgeshire, which has one of the most troubled health economies in the country. We are very underfunded. In 2013-14, our clinical commissioning group received the second lowest funding per head in the entire country. It has improved slightly since, but we are still far below where we should be. Somewhere has to be second lowest, but that is not a fair share. The Government have a fair share formula, but since it has been revised, rightly, to take account of deprivation, we have been left £35 million below the fair funding calculation. We get £961 per head in the Cambridgeshire and Peterborough CCG, whereas the figure for next-door West Norfolk is £1,255 per head. We are getting a slightly larger increase than others, at 2.9% rather than 2.14%, but at that rate it will take about a decade to catch up, with no compensation for

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the years of underfunding. I accept that NHS England makes decisions on how we get to the fair rate, but I hope the Minister will agree that the pace of change is simply too slow.

We have other problems. Our population is growing quickly: Cambridgeshire’s population growth is the fastest in the country and Peterborough is the fastest growing city. That means an even greater strain on funds, because the population increase is not properly taken account of. Our funding per head is going up slower than the national average, in spite of being low to start with. Will the Minister ensure that growth is no longer penalised? We also have a legacy of poor decisions, such as the two massive private finance initiative projects under the previous Government at Hinchingbrooke and Peterborough hospitals, the biggest and perhaps worst PFI projects in the country. They are still sucking money out of the system. When preparing for the debate, I was shocked to find that the PFI repayments for Peterborough represent a staggering 18% of the hospital’s budget.

We have less money than elsewhere, and we have more of that taken away from us before we even start, but we also have other legacy issues. Cambridgeshire is repeatedly used as a test bed for experimentation, such as the £1 billion privatisation of Hinchingbrooke hospital, led by and legislated for by the previous Government. They put the hospital out to tender and had not a single NHS bid among the final five bidders—Addenbrooke’s hospital pulled out because the cost was too large—so a list of three private bidders was left to the Government to choose from, which is not exactly a great choice to have to make. That is why I find it frustrating when the shadow Health Secretary claims to have clean hands over what happened with Hinchingbrooke. He claimed that one of the three bidders was an NHS provider, as he did in the House today, and I have been trying to find out which of the three—Circle, Ramsay or Serco—he considers to be part of the NHS. He said on Twitter today that it was the one associated with an NHS mental health body, but the day Serco counts as an NHS bidder is one I hope we will never see. Problems remain at Hinchingbrooke.

I am pleased, by the way, about the recent tendering for Cambridgeshire older people services, which I will talk about later. However, under the current Government’s legislation—which, incidentally, I opposed, because doing things in that way was not right for this Government or the previous one—the bid went to the NHS, with the mental health trust and Addenbrooke’s hospital providing the better services.

Cambridgeshire starts off with a particular historical situation and no money, so it is no wonder that we struggle to fund mental health properly. Things get worse. The CCG ran a small deficit last year, which is hardly surprising, but that makes it ineligible for quality premium payments, which could have brought in another £1 million. How can it make sense to starve CCGs of funding as a punishment for not having enough money to do the job properly? No one will be surprised to find that there is a correlation between budget outcomes and how well funded CCGs are: areas with funding above their fair-share calculations run surpluses, while those funded below their fair share run deficits and get punished for it. The deficit of £4.9 million from last year has to be

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repaid this year, putting even greater strain on the CCG, given an underfunding level of almost 10 times that figure.

In fairness to the CCG, it provides proportionately about the same allocation to mental health as everywhere else. We start off with far too little, however, so mental health gets far too little—one of the worst levels of funding in the whole country. That is in spite of long-term underinvestment and the huge pressures of growing demand—a 12% increase in the number of people with serious and enduring mental illness, but no extra money to cope with it. Given that the previous Government introduced a payment by results tariff system for physical health, but left mental health using the block grant system, extra demand—extra work—does not lead to extra funding. Yet again, changes were made to help physical health care rather than mental health care. As we rightly reduce stigma and tackle the huge unmet need for mental health support, more and more people will realise they need help and will seek it, but will discover that it is not there for them.

We have seen other problems. There was a suggestion from NHS England that there should be differential deflators—larger savings on mental health treatments than on physical health treatments. I know that infuriated my right hon. Friend the Member for North Norfolk, and I understand that the situation will not be repeated, which is welcome. I was disappointed to see that my own CCG complied with the suggestion, although in fairness it gave an extra £1.5 million for mental health services and as of next April will give a further £2.2 million to help meet targets for improving access to the psychological therapies programme.

The Nobel laureate Ernest Rutherford said, “We haven’t got any money, so we’ll have to think”, and providers in Cambridgeshire and Peterborough have had to be creative to cope with the awful funding position. We have seen many innovations. The mental health trust has set up a single point of access known as ARC—the advice and referral centre—reduced out-of-area placements and focused more on community teams. Its recovery college is doing good work in advancing the recovery model of mental health care.

We are doing some amazing things to use resources more efficiently in joint working. The £800 million contract for Cambridgeshire older people’s services—as I said, that stayed in the NHS—will combine acute trusts, mental health and community care, to help people seamlessly so they are not passed between one organisation and another. In particular, it should mean a sharp decline in the number of delayed transfers of care, where an older person is stuck in an acute hospital bed—at great expense and not to their benefit—because there is no alternative available in the system. No longer will Addenbrooke’s hospital have to negotiate desperately for community care beds; there will be one system. The contract design, with outcomes-based contracting, means that, rather than rewarding activity, there is an incentive to reduce the need for treatment. Keeping someone healthy longer is better for them and cheaper for us than treating them when they are ill.

We have to do much more on prevention, an issue I know the Minister cares greatly about. In his Five Year Forward View, Simon Stevens called for a radical emphasis on public health and prevention; promoting public mental health must surely be a key part of that, with resilience

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and well-being as the core. Mind recently called for local authorities to prepare public mental health strategies. Cambridgeshire county council’s health committee, chaired by the excellent Councillor Killian Bourke, has already commissioned such a strategy and plans to spend £120,000 on it. It will attempt not only to promote mental health in the very widest sense but to target groups that are particularly susceptible to experiencing problems, investing in effective, evidence-based interventions.

We also need to focus on recovery, on which the mental health trust’s recovery college is leading the way. Recovery is an approach to mental health that recognises that full recovery is not always possible—some conditions are lifelong—and seeks to enable patients to recover their lives from their conditions so they can live more fulfilled lives. That is in contrast to the attachment model, in which people are stuck as service users for ever. However, a recovery-led approach has to be properly resourced and must not simply be used as an excuse to close down services; otherwise, discharged patients will just be shut out of services and will return to being bounced around the system, looking for crisis care.

We need good crisis care as well, so that people can receive help. I again pay tribute to my right hon. Friend the Member for North Norfolk for his work on the crisis care concordat, bringing organisations together to deal with such crises. Currently, a huge load is placed on the police and acute hospitals—they end up dealing with people who should not be there but have nowhere else to go.

We must also make sure that there is a wider understanding of mental health throughout the health system. Primary care is key. I am astonished that GPs do not have compulsory training in mental health care. They will surely deal with mental health issues regularly, given that one in four of us will have a serious mental health condition at some point. Why are GPs not expert in mental health care? They could do far more to help people recover, remain independent and live better lives.

The voluntary sector is also key. I pay particular tribute to organisations such as Mind in Cambridgeshire, led by its very able chief executive Sarah Hughes; she has driven forward the crisis care concordat which was signed for Cambridgeshire and Peterborough just a couple of weeks ago. I also pay tribute to organisations such as Rethink Mental Illness, the Richmond Fellowship, Lifecraft, Centre 33, pinpoint, the SUN network, Arts and Minds and many more, whose work is hugely valued.

Finally, I will focus on an issue particularly close to my heart: child and adolescent mental health. It is a very important issue, because those who experience their first mental health problems at that stage can often be helped to recover completely. Often, the problems are a product of their environment, so early intervention can be radically preventive; however, waiting lists are far too long. In Cambridgeshire the health committee is trying to work with Centre 33 to provide more counselling support for young people. We have to go further on that and sort this issue out. Pinpoint and Healthwatch have recently contacted me about the urgent need to do more for child and adolescent mental health services. Many of my constituents have been in touch on that matter, as well.

There is far more that I could talk about. For example, I could discuss the troubled implementation of the Epic e-hospital system at Addenbrooke’s and the lessons we

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have to learn from that, the ongoing problems in the East of England ambulance service, or the desperate need to reopen community care beds in Brookfields hospital so that people can be moved from Addenbrooke’s into appropriate care. I could also talk about many positive things, such as the move of Papworth hospital to the Cambridge biomedical campus, which is proceeding apace, planning permission having recently been granted after my right hon. Friend the Chief Secretary to the Treasury approved the funding.

I will conclude instead with a plea. Mental health services in Cambridgeshire, and indeed across the country, are simply not good enough. I welcome the Government’s commitment to change that, and the idea of parity of esteem in particular, but it is not enough. We also need more money in mental health care across the board—hence my plea to the Minister for an extra £500 million targeted on mental health care.

In Cambridgeshire, we face a financial crisis across all forms of health care. Our low funding levels, historical commitments and growing population create a triple whammy. However, there is a way forward. Just yesterday, I took the chief executive of the mental health trust and the chair of the clinical commissioning group to see my right hon. Friend the Member for North Norfolk to make the case, and I think he was sympathetic to our position.

I will say here, to this Minister, what I said then to that one. There is an opportunity now, given the extra money that I and others campaigned for in the autumn statement. That extra £2 billion will have to be allocated somehow, so what formula should be used? I urge her in the strongest terms not to use the current ratios. That would mean giving extra money to areas already getting more than their calculated fair share, and less to those of us who are behind that fair share. Instead—I hope she will press NHS England on this—the money should be used to jump-start the shift to the new fair formula.

I understand why the transition is being made slowly—those areas with more funding than the fair share probably do not feel overfunded, even though they are able to run a surplus. But the new money allows us to correct the deficiencies for low-funded areas without creating losers. I am aware that £200 million has been earmarked for challenged health economies, and we are one of the 11 that have been so labelled. Although I welcome that, the Government should allocate all the money to move people up to the fair share if they are below it. I know that if our clinical commissioning group got the missing money—the £35 million that the fair shares formula says we should have, plus our share of the extra £2 billion—a high proportion of it could and would go on mental health care, transforming, helping and saving many lives. I hope the Minister will do what she can to make sure that that happens.

4.17 pm

The Parliamentary Under-Secretary of State for Health (Jane Ellison): It is a pleasure to serve under your chairmanship, Dr McCrea. I congratulate my hon. Friend the Member for Cambridge (Dr Huppert) on securing this debate and commend him on his ongoing interest in

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local health matters. I know from meeting the chair of his CCG only yesterday that my hon. Friend is a consistent champion of local services.

I am sorry that the Minister of State, Department of Health, my right hon. Friend the Member for North Norfolk (Norman Lamb), cannot be here to respond to the debate, but he has already shown a keen interest in its subject, and I know that he will take action forward. I also echo the tributes that my hon. Friend the Member for Cambridge quite rightly made to NHS staff at the beginning of his remarks.

We all agree that good-quality patient care has to be expected regardless of where in the country we live. As my hon. Friend quite rightly said, for too long, mental health services were the forgotten area of the health service. That is changing under this Government, and I will touch on that later. There is still, however, much to do; I am sure that we would all acknowledge that.

Although I will not dwell on the subject too much in this debate, my hon. Friend was right to comment on prevention and on building resilience. As the public health Minister, those issues are close to my heart. He was also right to talk in broader terms about building resilience in individuals. I know considerable thought is being given to making it possible for people—young people, in particular—to withstand more of what life throws at them.

I move on to questions of national funding. For 2014-15, NHS England allocated £64 billion to CCGs for hospital, community and mental health services—an increase on the previous year of 2.54%, or £1.59 billion. In making allocations, NHS England relies on advice from one of our many health acronyms, ACRA—the Advisory Committee on Resource Allocation. ACRA gives advice on the share of available resources provided to each clinical commissioning group to support equal access for equal need. Much of our debate will revolve around those funding formulas and how they are evolving. The calculation is based on the age of populations, their relative morbidity and unavoidable variations in cost. The objective is to ensure a consistent supply of health services across the country. The greater the health need, the more money is received, because more health services are needed. The CCG model covers only non-specialised hospitals and community care, plus primary care prescribing.

I understand that the baseline varies systematically between locations. To some extent, that reflects different historical commissioning priorities in the predecessor organisations—the primary care trusts—or different mixes between the local and area commissioning responsibilities.

NHS England reviewed the funding formula for 2014-15 and the following years, and it now uses the person-based resource allocation approach, which was developed by the Nuffield Trust. Unlike the previous target models, it allows information about individuals—including their age, gender and recent hospital diagnostic history—to be combined with information about the area in which they live; that information, as my hon. Friend knows, is frequently linked to deprivation. The PBRA formula estimates the relative need of each individual. At a CCG level, the estimates are the most accurate ever used for allocations, so there has obviously been a change in how resources are allocated.

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In debates such as this we often discuss the pace of the change from the actual allocation towards the target allocation. The option that NHS England agreed for CCGs reflected the challenge of directing additional funding to the CCGs that are the most under target, while not destabilising areas whose allocations were above target—I have seen that happen in London. If people have had an allocation for a long time, we must ensure that they plan for the change; such things must be done sensibly. That is a continuation of the policy of maximising growth for those furthest below target. We appreciate that CCGs in the east of England are further below their target allocations than those in many other parts of the country—my hon. Friend is right to draw attention to that—and that Cambridgeshire is one of the furthest behind target by some £45 million or 4.85%.

NHS England is already spending £500 million in 2014-15 and 2015-16 to bring under-target CCGs, such as Cambridgeshire, towards their target allocations. That approach was discussed and decided at a public board meeting in December 2013—nearly a year ago. My hon. Friend is pushing us to speak about what will happen in the future. Following my right hon. Friend the Chancellor of the Exchequer’s announcement in the autumn statement of a further £2 billion for front-line services, NHS England is reviewing the 2015-16 allocations. I hope that NHS England shares the hopes of my hon. Friend the Member for Cambridge, and that it will consider how some of that extra £2 billion can be used to help the CCGs that are furthest behind—including Cambridgeshire—to get closer to their fair share. My hon. Friend has already discussed that issue with my ministerial colleague, my right hon. Friend the Member for North Norfolk, who takes it extremely seriously and is committed to raising the matter with NHS England before it makes a decision at its board meeting on 17 December.

Like my hon. Friend the Member for Cambridge, I recognise the commitment and dedication of the staff who provide mental health service, including those who work in specialist trusts and settings, and those who work in primary care and provide services daily. I was pleased that my hon. Friend spoke about the large army of people who are absolutely critical in mental health. They are often not formally part of the NHS composition of services, but their support is invaluable to it. They are the carers and volunteers, who sometimes work in charities or voluntary organisations—my hon. Friend referred to Centre 33 and a number of other organisations in Cambridgeshire. Sometimes they are simply individuals who help or care for a parent, a friend or a neighbour because they think it is the right thing to do. Without those people, the job of the health services would be immeasurably more difficult. Like my hon. Friend, I pay tribute to them.

Robert Halfon (Harlow) (Con): On that point, will my hon. Friend the Minister praise West Essex Mind, whose annual general meeting is this Friday? It does so much to help mental health services in Harlow and across Essex, and it is an example of a charity that is deeply rooted in our community.

Jane Ellison: Of course I join my hon. Friend in paying tribute to that organisation. It is obvious from the comments of many hon. Members in this House

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that local branches of Mind and other groups do terrific work. My hon. Friend clearly has a good relationship with his local branch, and I thank him for placing his regard for it on the record.

The Government have increased funding for mental health by £120 million in 2014-15. Total mental health spending in England will rise from £8.5 billion in 2013-14 to £8.62 billion in 2014-15. The Department of Health and NHS England continue to work together on that important issue. I recognise the challenge faced by the Cambridgeshire and Peterborough health economy. I agree with my hon. Friend the Member for Cambridge about the private finance initiative decisions that the previous Government made about Peterborough, and about the legacy of problems that they left.

As my hon. Friend knows, action is being taken. NHS England, the NHS Trust Development Authority and Monitor are working on a programme to support 11 of the most challenged health economies, of which my hon. Friend’s is one, and to address those with long-term integrated plans. In Cambridgeshire, a programme jointly funded by all local NHS partners and underpinned by a concordat on joint working has been put in place. Its purpose is to find a collectively agreed solution to closing the financial gap facing the economy as a whole, while improving quality of care for my hon. Friend’s constituents and everybody else who is served by the local health economy. That work is due to identify proposals by the end of June 2015.

Mental health is an important part of that work, and emerging ideas focus around closer integration of physical and mental health, and an expanded role for mental health input in a range of hospital settings and community pathways, such as those for long-term conditions. As the Minister with responsibility for public health, I know only too well that people often have extreme co-morbidities, so we must look at them in the round and at all the things that interact with and affect their personal health care.

I know that there are concerns that mental health services could be disproportionately affected, which would not be acceptable. Although payment for mental health services is agreed locally, we expect local commissioners and providers to have regard for the national tariff arrangements. However, they can be flexible when there is good reason to be so.

The tariff arrangements for 2015-16 give a clear signal to the mental health sector to move away from simple block contracts, which currently apply in Cambridgeshire and are not transparent, to local payment models that support recovery and outcomes, as my hon. Friend highlighted, and that reflect the needs of local communities.

My hon. Friend is right that Cambridgeshire and Peterborough CCG invested an additional £1.5 million to address capacity pressures. His CCG is clearly committed to that, and he will continue to champion it. It has also committed to investing a further £2.2 million from next April to deliver the Improving Access to Psychological Therapies programme.

My hon. Friend is right to pay tribute to my ministerial colleague, my right hon. Friend the Member for North Norfolk, who has championed mental health policy in this Parliament very effectively. My hon. Friend the Member for Cambridge drew attention to the Government’s

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commitment to parity of esteem, which has been made explicit in legislation. Some 2.4 million people have entered treatment under the IAPT programme, and more than 1.4 million have completed that treatment. We invested £54 million in the period from 2011 to 2015-16 in the children and young people’s IAPT programme. My hon. Friend is right that child and adolescent mental health services are a critical part of our local care pathways.

For the first time ever, we have a mental health crisis care concordat to improve the system, signed by more than 20 national organisations. As my hon. Friend said, Cambridgeshire has already put it in place. We invested £25 million to ensure that vulnerable offenders are identified when they first enter the criminal justice system. The aim is to achieve 100% coverage by 2017.

There is a lot going on. We all acknowledge that there is a long way to go on mental health, but we have passed several important milestones on the journey. The NHS—both nationally and in Cambridgeshire—is working hard on the wider funding issues, and I hope I have assured my hon. Friend that progress is being made. He has already had a commitment from my right hon. Friend the Member for North Norfolk, but when I return to the Department I will reiterate that we want to make representations about the points he made to NHS England ahead of the critical funding meeting. I encourage my hon. Friend to keep closely in touch with his local NHS, although I can see that he does that. I thank him for securing this debate. I hope I have given him a measure of comfort and reassured him that considerable progress is under way on this important agenda.

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Energy Policy and Living Standards

4.30 pm

Douglas Carswell (Clacton) (UKIP): Government energy policy, put in place by Ministers of all three established parties, is pricing people out of being able to heat their own homes. The cosy consensus over energy policy here in Westminster is squeezing living standards across the country. According to the index of domestic fuel and light prices, helpfully reproduced by the House of Commons Library, prices have changed fairly dramatically over the past 40 years. From the early 1980s through to the early noughties, there was a slow, gradual fall in prices; it was a 20-year period of customers getting what they tend to get in a free market, capitalist economy—more for less.

Suddenly and dramatically, that picture changed in the early noughties. Since then we have seen a rapid rise in prices—sharper, indeed, than that experienced during either of the two oil shocks of the 1970s. Dual-fuel household energy bills in 2014 for the average home are forecast to be almost £1,400. That represents a real-terms price increase of over 50% in a decade—a decade during which average household incomes stagnated and during which, by some measures, the UK’s per capita income has fallen. Fuel bills have gone up sharply, but income has hardly changed. Living standards have been squeezed as a consequence. Pensioners and those on low incomes tend to pay a disproportionately high proportion of their incomes on energy. The definition of fuel poverty may have changed, but one stark fact cannot be overlooked: a large number of households—4.82 million households—now spend over 10% of their income trying to keep warm.

Why have energy prices gone up so rapidly? Why did the historic decline in energy prices suddenly turn around in the early noughties, and why have costs gone up in this way? Is it because there is not enough of the stuff? Are we perhaps running out of gas? Not at all: wholesale energy costs have actually been falling as a proportion of the total. According to Ofgem, for every £1 we pay on domestic fuel bills, only about 44p goes to meet the wholesale price. People might think, “Is this all the fault of those beastly energy companies? Are they the ones to blame?” About a fifth to a quarter of the bills that we pay covers the cost of the energy companies distributing and supplying what they sell us. People might think, “If only energy companies were forced to lower their prices, perhaps we could have cheaper energy for everyone.”

Albert Owen (Ynys Môn) (Lab): Will the hon. Gentleman give way?

Douglas Carswell: With a due sense of reluctance, yes.

Albert Owen: I am very grateful. I welcome the fact that the hon. Gentleman has secured this debate. I guess that his party is now an established party—now that they are here, they are part of the establishment. The serious point is that distribution prices vary considerably across the 14 regions and contribute to between 19% and 25% of the bill. Does he agree that it is possible to have a leveller so that across the United Kingdom—or certainly in Great Britain—those prices could be the same? Does he also agree that it should be possible for

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people off-grid to get a better bargain? He mentioned dual fuel, and many people in deprived and rural areas are not on the grid, so they do not get the benefit of dual fuel discount.

Douglas Carswell: The hon. Gentleman argues in favour, I think, of Government price-fixing and making it illegal for suppliers to charge different prices in different parts of the country. I think there are a number of flaws in that approach. For a start, it could quite possibly mean that some areas would have to go without supply at all. Generally speaking, if we try to fix prices, we interfere with the allocation of resources and we have to be prepared for black-outs. That is not something that I would want, but he is absolutely right to say that a fifth to a quarter of the bills that we pay cover the cost of the companies distributing and supplying energy. The hon. Gentleman then makes the leap that many have made, which is that if only we could force energy companies to lower their prices, we could have cheaper energy for all. That, at least, seems to be the level of logic from the right hon. Member for Doncaster North (Edward Miliband). However, a prices and incomes policy for energy in 2015 will no more work than a prices and incomes policy has worked for anything in the past. Prices and incomes policies do not work.

Energy prices are not going up because of a shortage of energy or because of beastly energy companies; public policy is driving up the cost of household energy bills. The renewable obligation requires energy companies to increase the proportion of energy they generate from supposedly renewable sources. That basically means that we have to pay more in order to subsidise the construction of wind turbines. The Government’s own estimate suggests that fuel bills have gone up by 7% to refund those renewable obligations. However, the Renewable Energy Foundation, for example, has pointed out that the methodology of the Department means that the figure of 7% is, by many ways of analysing it, an extraordinary understatement. If we measure the increase in terms of price per kilowatt-hour, the increase in prices is likely to be far greater.

According to data that the Department recently put out following a freedom of information request, in the central fossil fuel price scenario for 2020, low-carbon policies will result in a 50% increase in energy costs for small business. In the low fossil fuel price scenario for 2020, low-carbon policies will cause a 77% increase for medium-sized companies, which would rise to 114% by 2030. Whitehall officials have gambled on the price and cost of fossil fuel and they have got it spectacularly wrong. I wonder whether the Minister, with an ambitious eye on the world beyond May next year, is willing to defend those policies.

The Minister’s colleague, the Secretary of State for Energy and Climate Change, has pledged to treble the amount of electricity derived from renewables. Will the Minister defend that, too? Energy prices are increasing because we are switching off perfectly good gas and coal power stations while pouring billions of pounds into windmills. It does not make sense.

Mr Jim Cunningham (Coventry South) (Lab): I am intrigued by what the hon. Gentleman has had to say, but his analysis has missed out the fact that the price of oil has been dropping. That can have an impact on the

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cost of living and on energy costs, particularly for poorer families in this country. How does he think we could get the oil producers to pass on that decrease to the consumer?

Douglas Carswell: The hon. Gentleman is absolutely right and makes a very valid point. For a number of reasons—not least because of technology and innovation in the United States and the shale gas revolution—the cost of fossil fuel is being driven down. Unfortunately, we have a Government whose officials banked on the cost of fossil fuels being relatively high, so we are now locked into a position where people will have to pay higher costs for years, despite the potential for a great reduction. It is extraordinary that a Government who once pretended to believe in the free market are presiding over that. It is quite remarkable. We should be benefiting from the lower oil costs, but we are unable to because we have a Department that is committed to price-fixing.

Sammy Wilson (East Antrim) (DUP): Does the hon. Gentleman accept that not only have the Government pushed up the price of electricity because of this infatuation with wind turbines, but that that in itself has led to distribution costs going up because the grid has to be reinforced, and that the carbon tax that is now imposed on the fuel used by the cheapest types of power stations is adding to people’s bills as well? The whole policy is directed towards high energy prices, which have reduced people’s standard of living and have furthermore chased industry out of the United Kingdom.

Douglas Carswell: The hon. Gentleman is absolutely spot on. It is irrational and uneconomic on so many levels. The irony is that the Government talk about windmills and wind turbines, using the language of sustainability, but the truth is that without the subsidy, it simply would not be sustainable. Unlike solar, it simply will not make economic sense to generate electricity through 13th and 14th-century windmill technology.

Mr Christopher Chope (Christchurch) (Con): I congratulate the hon. Gentleman on securing the debate. Does he accept that the Government’s policy is very illogical in this area? For example, we are spending taxpayers’ money in order to enhance the setting of a world heritage site at Stonehenge, while at the same time using taxpayers’ money for subsidies for offshore wind turbines that are going to wreck the world heritage site on the Jurassic coast?

Douglas Carswell: The hon. Gentleman makes a brilliant point. He is extremely sound on this issue, as on so many other things. There are things on which it is good to spend public money, and securing the future of something like Stonehenge is wonderful, but one of the downsides of subsidising windmills is that they damage the countryside. It is not good conservation practice to industrialise the countryside with these subsidised wind turbines. It is not good for the environment or our heritage sites. It is not good, either, for people in Jaywick and west Clacton in my constituency, who are deliberately being priced out of being able to heat their home. Why? Because an out-of-touch elite in Westminster and Whitehall believes that that will somehow save the planet from excess carbon dioxide emissions. It is the Alice in

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Wonderland world of SW1 that has come to believe that. Ministers are competing to be the mad hatter, but it is a ridiculous state of affairs.

The Climate Change Act 2008 was a mistake. I should have listened far more carefully to the late, great Eric Forth MP and voted against it. My failure to do so is my biggest regret as a Member of Parliament. My new party looks to help me to right that wrong, or rather I look to help it to right that wrong.

Government schemes promising to insulate homes have been a flop. In Jaywick and west Clacton, in my corner of Essex, thousands of householders were led to believe that they could get free home insulation. For all that, it has happened only for a handful. The green deal has failed, and alongside it the Minister who presided over the scheme. Should we now follow the right hon. Member for Doncaster North, who has declared that he wants energy prices to be fixed and a prices policy for energy? He may have committed his party to a price freeze, but that will not mean lower energy prices for everyone. If we hold down the price of something by Government fiat, we end up constraining the supply of it. That policy will lead directly to black-outs.

The real reason for higher energy prices is the public policies that were put in place by the right hon. Member for Doncaster North when he was the Energy Secretary, and which all three parties now support. All three parties have had a say on energy policy and all three parties have got us to this sorry state of affairs. We need a return to the idea of an honest energy market. The Minister might pay lip service to the idea of a free market, but where it counts—when it comes to what he actually does in office—he is cheerfully defending a system of energy production that is anything but free, so let me remind him of what an honest market in energy production might look like.

If we had an honest energy market in this country, suppliers would compete to supply householders with energy at a price that they were willing to pay. There would be no requirements on them to produce a particular mix or quota of energy. Innovation and competition would mean giving customers more for less. Capital and technology would come together to satisfy customers. Instead, we have a system in which lobbyists and quotas meet in Government Departments in pursuit of renewable targets. It is a corporatist racket, not an energy policy that is remotely competitive or free. Coal, gas, fracking, nuclear—who knows what mix we might get if we had innovation, capital and a free, honest market in energy?

If the Minister finds it hard to imagine what a free market in energy might look like, may I suggest that he look across the Atlantic? Gas prices for domestic consumers have fallen by 26% in five years in the United States. As our prices have risen, over there they have fallen. It is not that the laws of physics are any different on that side of the Atlantic. The laws of physics are the same. It is public policy on this side of the Atlantic that is so fundamentally flawed and needs to change.

Voters who struggle to pay their heating bills this year should rightly blame those on all three parties’ Front Benches, who put this dreadful scheme in place. We need to make a change. We need to scrap the subsidies. We need to love the new technology, but subsidies must be abolished.

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Robert Halfon (Harlow) (Con) rose

Dr William McCrea (in the Chair): We will now hear a short intervention by Robert Halfon.

Robert Halfon: On a point of order, Dr McCrea. I have permission from the hon. Member for Clacton (Douglas Carswell) to make a short speech in this debate. Can I just confirm that that is the case?

Dr William McCrea (in the Chair): Yes, you have permission to make a speech, but it needs to be short, because we have to give the Minister time to respond.

4.43 pm

Robert Halfon (Harlow) (Con): Thank you, Dr McCrea; I will speak for three minutes or so. I am very grateful to the hon. Member for Clacton (Douglas Carswell) for giving me permission to make a speech, and I congratulate him on securing this important debate. I will focus on different areas, but I do think that the Government have done good things—in particular, providing a rebate to every domestic electricity customer and reducing bills by £130 for 2 million of the poorest households through the warm home discount. And of course the hon. Gentleman will know about the huge fuel duty freeze that the Government have pledged to maintain across the Parliament, so that the price of fuel is 20p lower in tax terms.

As I said, I will concentrate on a number of areas. The first is the difference in the cost of energy depending on which payment method a customer uses. I have worked with the hon. Member for Ynys Môn (Albert Owen) on this issue. Earlier this year, I conducted a cross-party campaign, with the support of more than 100 MPs, against the practice by energy companies of charging customers extortionate amounts for not paying by direct debit. My right hon. Friend the Prime Minister ordered an investigation into that, but all that Ofgem has said to me is that although there were some anomalies, such as the £390 extra that Spark Energy customers were paying, those cases were exceptional. However, Department of Energy and Climate Change figures show that the average person who does not pay by direct debit pays £114 more each year. That is just not good enough.

One elderly lady in my constituency of Harlow, who always paid on time via the post office, received a letter saying that she would have to start paying an extra £63 a year if she did not start paying by direct debit. That is unacceptable. Charges such as that are excessive and harm the most vulnerable in our society, particularly the 2 million people who do not have proper banking facilities, which makes payment by direct debit almost impossible. I hope that my right hon. Friend the Minister will clarify what the Government are trying to do on that.

Secondly, there is a problem, which has been raised, regarding prepayment meters. The cost of using those is often significantly higher than of using any other method. Traditionally, that was justifiable: companies had to pay people to go and empty the meters of coins. But there are now prepayment cards. Those who use prepayment meters are charged extra even though they are the least able to afford it. That needs to be looked at urgently.

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Thirdly, there are other ways in which energy bills are increased, often through no fault of the consumer. The example has been mentioned of the 4 million households who are off the gas grid and will never be able to get the best deals as they cannot get a dual-fuel discount. It would be helpful if standard criteria could be introduced across suppliers to allow families with children clearer guidance as to whether they will qualify for the warm home discount.

Finally, I believe that the only way in which the situation can be improved is not by imposing an energy price freeze, which will only hike prices up in the long term, but by scrapping the existing regulator and creating an energy version of Which?, a consumer regulator that stands up for the customers, not the energy companies, and that has real teeth. As pointed out in The Sun newspaper today and as mentioned by the hon. Gentleman, The Sun is running a campaign for fuel companies to cut their prices following a significant fall in the international price of oil. I have previously handed a petition to the Office of Fair Trading with FairFuelUK calling for an inquiry into the rocket and feather effect, but there has never been a full inquiry.

In conclusion, stopping the premium on non-payment by direct debit, action on additional and hidden costs and turning Ofgem into a genuine consumer body would make a huge difference to residents of Harlow, and to energy bills and the cost of living for millions of people across the country.

Mark Reckless (Rochester and Strood) (UKIP) rose

Dr William McCrea (in the Chair): One hon. Gentleman is standing, but convention demands that a Member has the permission not only of the Member who has secured the debate, which is Mr Carswell, but of the Minister, and he needs time to respond, so is the Minister willing to give a couple of minutes to the hon. Gentleman?

The Minister of State, Department of Energy and Climate Change (Matthew Hancock): Of course.

4.48 pm

Mark Reckless (Rochester and Strood) (UKIP): Thank you, Dr McCrea; I am grateful to the Minister. I congratulate my hon. Friend the Member for Clacton (Douglas Carswell) on securing this debate on energy policy and living standards. This is a key issue for our party, and I think that this is the first debate that we have secured in the Commons.

Energy costs are being driven up through a levy control framework that shows the cost rising from £2.3 billion in 2012 to £9.8 billion in 2020. Much of that money is going on offshore wind. Rather than trying to develop leading, cutting-edge technologies, or some of the areas that have been improving in cost-efficiency such as solar, we are seeing the roll-out of absolutely masses—almost half the world’s production—of offshore energy, which costs about three times the market energy price. That is an absolutely extraordinary imposition on our constituents.

At the same time, we are bringing in a capacity market that even Mr Huhne, who was the Energy Secretary, did not want to see. At least he was an economist and realised, as I would have thought the

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Minister would also recognise, that as soon as a capacity market is announced, people will not build capacity until they start qualifying for the subsidy. That subsidy now seems to be available to almost everyone, rather than just those who have capacity that can be switched on reliably and immediately. That is going to be yet another imposition that drives up costs for our consumers.

Perhaps the most significant cost is what is happening to coal. The European Union is shutting down coal plants, including Kingsnorth in my constituency. Demolition of Kingsnorth has just commenced under the large combustion plant directive, and various pieces of successor legislation are even worse. The Government did not apply for a derogation that could have got us through a period in which there was a particular crunch in our energy demand. Why did not the Government at least try to obtain such a derogation? The Government, not the EU, are banning the construction of new coal-fired plant. E.ON, which owns Kingsnorth, would have liked to build a new supercritical plant, which would have provided much more efficient energy production, but the Government have banned it because of the emissions performance standard, I believe. Such projects are going ahead in Germany and other countries, but we are unilaterally driving up costs for our consumers, reducing the competitiveness of our industry and holding our country back.

4.50 pm

The Minister of State, Department of Energy and Climate Change (Matthew Hancock): I congratulate the hon. Member for Clacton (Douglas Carswell) on securing the debate and on choosing energy as the subject for his first Westminster Hall debate in his new iteration in this Parliament. My central response to his argument is that it is important to look at the facts and have a rational debate about the matter. Central to his big-picture hypothesis was the argument that energy costs have been rising since the early 2000s, before which they had gradually declined. He went on to say that wholesale costs were falling as a proportion of the total cost. However, the wholesale price has risen sharply during that period, and the wholesale price—the amount that is beyond the control of any Government—is a central driver of energy costs. Without acknowledging that core fact, it is difficult to have a rational debate on the subject, which I think we would all value.

Mark Reckless: The Minister says that the price is beyond the control of any Government, but Saudi Arabia has had quite a big impact on price by not increasing its oil production, and the US has done likewise by allowing and facilitating exploration for shale gas and oil, which we have held back so badly in this country.

Matthew Hancock: Nobody has direct control over wholesale costs, although I entirely take the point that Government policy that has an impact on the supply of energy, particularly hydrocarbon energy, can have an impact on price. I share the hon. Gentleman’s enthusiasm for shale, and the Government’s proposals will ensure that exploration for shale gas can happen as long as it is done carefully and within a regulatory framework that ensures that it is safe. I hope that he, his colleague the hon. Member for Clacton and all colleagues in his new

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party will support the local extraction of shale gas; his view is not shared by members of his party across the country. I welcome the support of the new establishment party for shale gas.

It is absolutely essential to ensure that we have security of supply at the lowest possible cost, while living within our international climate obligations. Perhaps there is a point of difference, because the risk of climate change is real and must be taken seriously, but the question is how we deliver on that in the lowest-cost way. On that, I think that the hon. Member for Clacton and I share some analysis. For instance, ensuring that taxes remain as low as possible is an important element of the Government’s programme. Even with the incredible deficit that we inherited, we have managed to keep petrol and diesel prices 20p lower than they would have otherwise have been. I pay tribute to my hon. Friend the Member for Harlow (Robert Halfon) for the work he has done on that, which is widely recognised. As oil prices fall, I support him in the call for those reductions to be passed on to the motorist at the pump now, not later. The work that he has done, including on the front page of today’s Sun, is an important contribution to this debate.

Mr Jim Cunningham: How will the Minister persuade oil producers to pass on the reduction in oil prices to the consumer? Price rises hit a lot of poor families because of their impact on public transport and the cost of living in general. Have the Government had any discussions about that, and how do they intend to achieve it?

Matthew Hancock: The Government have had discussions about that. Ultimately, those changes can be best driven by competition. I share the disdain of the hon. Member for Clacton for prices and incomes policies in energy. Indeed, I think that he has missed some of the changes that we have made over the past couple of years, not least in the Energy Act 2013. For instance, he argued for more competition between different technologies so that those with the most potential can drive down costs and improve the situation for consumers. By switching from a regime in which, as he described, subsidy is given out to whatever renewable technology was brought forward to a regime in which a controlled pot of subsidy is auctioned to ensure that we get the best possible value for money, we have made a change towards a market-oriented system.

Douglas Carswell: In the United States over the past five years there has been a 26% reduction in wholesale gas prices and gas prices to consumers. Does the Minister have something to learn about public policy from America?

Matthew Hancock: I have no doubt that the massive expansion of the extraction of shale gas in America has had a downward impact on gas prices. Allied to that is the fact that America did not have many export terminals—it is now building them—which meant that

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it had a relatively closed market. We are working hard to get shale gas extraction going in the UK, where I think that it has huge potential. The Infrastructure Bill, which is currently before the House, proposes changes to make it easier to get shale gas out of the ground in a carefully regulated and safe way. I welcome the hon. Gentleman’s support for that.

The capacity mechanism and the changes to make our energy system more driven by competition are designed to ensure that we get that security of supply as well as the cheapest possible cost. That is best done through a market mechanism, but the market must have a strong framework around it, because we must ensure continuity of supply in order to keep the lights on.

Robert Halfon: Will the Minister make a brief comment about the continued problem of the big energy companies charging a premium to vulnerable people who do not pay by direct debit?

Matthew Hancock: That is something that I am actively looking into, and I look forward to working with my hon. Friend to take it forward.

Albert Owen: One area in the energy market where there is no competition at all is distribution. The regions have monopolies, and the differential between them is some 6% of the bill. Does the Minister welcome Ofgem’s review of that subject, so that we can have proper, fairer pricing across the United Kingdom?

Matthew Hancock: Of course I welcome Ofgem’s review into the matter, and I think it is an important question. If we simply socialise prices across the whole of the UK, somebody has to pay those prices. The key question is how we can sort that out in a way that represents the best value for money. We have always had a relatively market-based approach, but the central point of Government policy is to move even more in that direction. The other important point is that without the action that the Government have taken, the average household dual-fuel bill would have been £100 higher this year.

Energy efficiency is the most effective way to drive down costs while cutting emissions and to bring down electricity bills for people, families and households. I am focused on that, and on ensuring that we get the best possible value. The Government have expanded energy efficiency enormously. Home insulation has been expanded and the green deal has reached hundreds of thousands of people. Those changes will ensure that we get the best possible value for money and that people pay lower bills, as far as is consistent with security of supply and our international obligations. That is the Government’s goal and we have made progress, but I have no doubt that there is more to do.

Question put and agreed to.

5 pm

Sitting adjourned.