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House of Commons

Tuesday 30 June 2015

The House met at half-past Eleven o’clock


[Mr Speaker in the Chair]

Business Before Questions

Contingencies Fund 2014-15


That there be laid before this House an Account of the Contingencies Fund, 2014–15, showing–

(1) a Statement of Financial Position;

(2) a Statement of Cash Flows; and

(3) Notes to the Account; together with the Certificate and Report of the Comptroller and Auditor General thereon.—(Stephen Barclay.)

Oral Answers to Questions

Business, Innovation and Skills

The Secretary of State was asked—

Small and Medium-sized Businesses

1. Alan Mak (Havant) (Con): What steps he is taking to support small and medium-sized businesses to become more competitive. [900630]

The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid): Our business growth service provides expertise to ambitious firms who want to grow and become more competitive, and over this Parliament we will make extensive cuts to red tape which will save businesses £10 billion.

Alan Mak: I thank the Secretary of State for his answer. Headromance is a Havant-based hair salon launched in 2012 by two young entrepreneurs. It now employs 10 stylists and five apprentices. Will my right hon. Friend update the House on the measures this Government have taken to support the growth of apprenticeships?

Sajid Javid: I warmly welcome my hon. Friend to his place. I am not sure I would have much need of the services of Headromance—I am sure that applies to the shadow Business Secretary too—but that does not stop me warmly congratulating its owners on their success and in particular on backing apprentices. As my hon. Friend knows, during this Parliament we want to see apprenticeship starts rise to 3 million, and we have a number of measures in place to achieve just that.

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Robert Flello (Stoke-on-Trent South) (Lab): I draw attention to my entry in the register of interests. Many small and medium-sized freight businesses struggle with the cost of training drivers. Have the Government any plans to look at this afresh with a view to helping people train to become lorry drivers in the UK?

Sajid Javid: As the hon. Gentleman will know, it is very important for the Government to listen to all industries about their skills and training needs, including for freight drivers. Of course, the option of apprenticeships is open to that industry, but we must look at other measures too.

Mike Wood (Dudley South) (Con): The business rates system is one of the major barriers to competitiveness for small and medium-sized enterprises. What plans do Ministers have to reform and alleviate some of that burden?

Sajid Javid: My hon. Friend will know that the Chancellor announced a full review of business rates in the last Budget. It is important to note that although that will be a proper full review looking at what sensible changes can be made, it will stay fiscally neutral, so it will not be possible to satisfy everyone.

Peter Kyle (Hove) (Lab): Brighton and Hove is the most entrepreneurial city in the country but still lags behind the region for productivity. What is the Secretary of State doing to increase productivity among small businesses?

Sajid Javid: There are a number of actions that Government can take, and some of them were taken by the coalition Government and are now bearing fruit, such as cutting taxes and the employment allowance. During the lifetime of this Parliament, there will be a big focus on productivity, and there will be further measures, including on deregulation.

Rishi Sunak (Richmond (Yorks)) (Con): The last Labour Government had an appalling record on regulation, introducing something like six new regulations a day. What does my right hon. Friend think that did for the productivity of small and medium-sized companies in the UK?

Sajid Javid: I welcome my hon. Friend to the House, and he is absolutely right: the last Labour Government had an appalling record on so many things, including regulation, and the more we can keep the red tape challenge going, and our policy of one in, two out, the more we will help businesses.

Jim Shannon (Strangford) (DUP): In Northern Ireland 99.9% of small businesses are the core of the industrial base. They create some 347,000 jobs. What can the Secretary of State do to ensure that those jobs can be retained and more jobs can be created?

Sajid Javid: The hon. Gentleman is right to point out the importance of small businesses, particularly in the context of Northern Ireland. He will know that many

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of the policies that impact on small businesses in Northern Ireland are devolved, but there are a number where we can make an impact through the UK Government. One is foreign investment, which has been going up in Northern Ireland, and we will continue to focus on that.

Self-employed People (Regulation)

2. David Morris (Morecambe and Lunesdale) (Con): What steps he is taking to simplify regulation for self-employed people. [900631]

The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid): The enterprise Bill will help to save businesses £10 billion through further deregulation. We have committed to launching a review into tackling the specific disadvantages faced by the UK’s 4.5 million self-employed.

David Morris: I thank my right hon. Friend for that answer. As the self-employment ambassador, the issue of the IR35 constantly crops up when self-employed people write to me. Can we meet to see how we can simplify this?

Sajid Javid: I thank my hon. Friend for the work he has done and continues to do as self-employment ambassador. I would be delighted to meet him to discuss how we can make the system fairer, quicker and simpler for the self-employed. He will know that tax policy, in particular, is an issue for the Treasury, and I will bring it to the attention of my hon. Friend the Financial Secretary.

Marie Rimmer (St Helens South and Whiston) (Lab): The number of self-employed people is growing, but they are often disadvantaged and face additional burdens when applying for a mortgage or to set up a pension scheme for themselves. What steps is the Minister taking to ensure that these barriers are not erected and do not attack the self-employed?

Sajid Javid: The hon. Lady is right to point out that issue. She may know, as I am sure she read it carefully, that the Conservative party had a very pro-business manifesto. We have rightly committed ourselves to having a review of the challenges faced by self-employed people and their businesses, and that would include looking at the issue she raises: access to mortgages.

Mr Philip Hollobone (Kettering) (Con): The self-employed in Kettering and across the country are the unsung heroes of the economic recovery, yet their terms and conditions, with no sick pay, no holiday pay and inadequate pension provision, are akin to those on zero-hours contracts. What will the Secretary of State do in this Parliament to ensure that the rewards for the self-employed, with their enterprise and endeavour, are properly recognised?

Sajid Javid: My hon. Friend, as usual, is spot on. He should know that this review will look at precisely those issues. A number of challenges are faced by the self-employed and it is about time the Government took a careful look at them. That is exactly what we will be doing.

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Andrew Gwynne (Denton and Reddish) (Lab): The Government’s universal credit plans are set to burden 600,000 self-employed people with additional red tape requiring them to provide a new set of monthly accounts. Given that the Secretary of State is responsible for cutting red tape, what is he doing about that? What is he doing to put self-employed people first?

Sajid Javid: The hon. Gentleman will know that the universal credit plans are essential to make sure that work pays, and I would have thought he would support that. On the issues that it might raise for small businesses and the self-employed, it is important that we look at the net burden of regulation on businesses and keep reducing it.

Industrial Strategy

3. Ian C. Lucas (Wrexham) (Lab): If he will implement an active and interventionist industrial strategy to assist economic growth in the UK. [900632]

The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid): The biggest challenge facing the economy is improving productivity, and that challenge varies by sector. Dialogue with business, including through the sector councils, as part of our industrial approach, is key to addressing this issue.

Ian C. Lucas: As a member of the last Labour Government, I am very proud that the Labour party, in government, established the Automotive Council, which has provided the framework for the most successful decade in UK car production for a very long time. Will the Secretary of State confirm that he will not, on the altar of ideology, endanger that success?

Sajid Javid: I look forward to working with the Automotive Council. In fact, I have already had a meeting with it and I told it something the hon. Gentleman would agree with, which is that the automotive industry is one of the brightest stars in the constellation of British business.

Mr Steve Baker (Wycombe) (Con): May I reassure my right hon. Friend that if he does wish to follow a more liberal policy than his predecessor, he will have plenty of support from Conservative Members?

Sajid Javid: I can tell my hon. Friend that we will have active dialogue with various industries, across sectors, and we will make sure that we are listening and seeing what the Government can do.

Andy McDonald (Middlesbrough) (Lab): Given tomorrow’s eagerly awaited announcement by the Teesside Collective on its ambitious industrial carbon capture and storage proposal, will the Minister, with his colleagues, ensure that industrial, energy and climate change policies are aligned and that every other assistance is given to the collective in bringing about an early realisation of this vital project?

Sajid Javid: I have listened very carefully to the hon. Gentleman, and if he would like to furnish me with more information about the Teesside Collective and how we can help, I would be happy to take a look.

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Mr David Jones (Clwyd West) (Con): The Government’s northern powerhouse strategy has the potential to offer huge benefits to north Wales. What discussions has my right hon. Friend’s Department had with the Welsh Government with a view to developing it?

Sajid Javid: As my right hon. Friend will know, this is a one nation Government. We want to make sure that, as the economic recovery continues, it includes every part of the UK, and that will of course include Wales. We are more than ready to talk to the Welsh Government. I have had a number of discussions with my right hon. Friend the Secretary of State for Wales, who at this point is a lot more interested than the Welsh Government in economic development in Wales.

Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op): The Chancellor says that he supports modern industrial policy and the Prime Minister has said that he wants an active industrial policy, but, according to the Financial Times,the new Business Secretary has told officials in the Department that they should not talk about industrial policy. Now we hear him talking about an “approach”. Can he tell industries around the country whether he still has an industrial policy and, if so, what on earth it is?

Sajid Javid: I think I have already answered the hon. Gentleman’s question, but I am happy to repeat that answer. This Government will have an active dialogue with all industrial sectors. We will listen to their needs on skills, infrastructure and training, and work with them. That includes the sector councils. We will also make sure that we are open to new industries, to competition and to disruptive industries, and that we become the most open economy in the world.

Strategic Support (Industries and Sectors)

4. Anna Turley (Redcar) (Lab/Co-op): What recent assessment he has made of the effectiveness of the Government’s strategic support for industries and sectors. [900633]

The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid): In preparation for the forthcoming spending review, I am assessing the effectiveness of BIS policies, including strategic support for industry. We will continue an open dialogue with business, including through sector councils.

Anna Turley: A long-term industrial strategy is vital for my constituency, which boasts a major chemical process complex in Wilton. Recently, the workforce have been taking to the gates because they believe that long, hard-won, nationally agreed terms and conditions are being undercut on the site. What assurance can the Minister give me, and what steps is he taking to make sure, that nationally agreed terms and conditions are being applied on such sites, and that the British workforce are not being undercut by recruitment from overseas?

Sajid Javid: I welcome the hon. Lady to her place. I know that a number of industries, including the one that she has mentioned, are important to Redcar. I am more than happy to take a closer look at the issue that she raises. I am afraid that I do not know the details of

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it, but if she would like to furnish me with them, I or my right hon. Friend the Minister for Small Business, Industry and Enterprise will take a closer look.

Tom Pursglove (Corby) (Con): Steel producers are an important employer in Corby. Will my right hon. Friend meet representatives of the steel all-party parliamentary group, who are working closely together, to talk about strategic support, especially on carbon taxation?

Sajid Javid: I welcome my hon. Friend to his place and congratulate him on his work to help the steel industry to meet those challenges. I will be more than happy to meet him and representatives of the APPG and see what more we can do, especially on the high energy costs that the industry faces.

Alan Brown (Kilmarnock and Loudoun) (SNP): I have previously suggested a strategic support mechanism for the open-cast coal industry—a carbon tax exemption for specific sites. An independent economic analysis suggests that an exemption with a value of £195 would produce a net income to the Treasury of £57 million and would also allow the sites to be restored. Will the Secretary of State consider that urgently and work with the Treasury to include the exemption in the July Budget or, following a previous offer, meet me to discuss it?

Sajid Javid: Steel is a very important industry, employing thousands of people in Britain. It is important to see what we can do to help, so I or my right hon. Friend the Minister for Small Business, Industry and Enterprise will be more than happy to meet the hon. Gentleman.

John Pugh (Southport) (LD): What plans, if any, do the Government have to make local enterprise partnerships more democratically accountable? They have more funds than the regional development agencies, but are less accountable.

Sajid Javid: It is right that LEPs are business-led, but it is also important that they include democratically elected people, and that is how they are working. It is important to review LEPs after a few years of operation and to ensure that they are truly accountable.


5. Huw Irranca-Davies (Ogmore) (Lab): What steps his Department plans to take to improve productivity in businesses and industries. [900634]

The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid): Productivity growth ultimately comes from business and the hard-working people of Britain, but the Government can, of course, help. That is why my Department is working closely with the Treasury on a forthcoming productivity plan.

Huw Irranca-Davies: The Minister is right about the reliance on individual workers to drive up productivity and about what the investor community can do as well, but he will know that the Office for Budget Responsibility has said that if productivity per worker was 4% higher during this Parliament, that would have a significant effect on reducing the national debt, and correspondingly,

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that if it was not, the national debt could rise. Does he agree with this rather gloomy assessment and, if so, what does he think the figures for individual growth per worker will be by the end of this Parliament?

Sajid Javid: The hon. Gentleman will know that the UK has had a long-running productivity challenge, which was made all the worse by Labour’s great recession. An increase in productivity is the surest way to raise real wages and I can assure him that it will be a major focus of this Parliament. We will shortly publish a productivity plan which I hope will reassure him that the Government take this very seriously.

Neil Carmichael (Stroud) (Con): Does the Secretary of State agree that in challenging the productivity problem, we need to address our minds to skills and making sure that we have the appropriate pipeline of skills running through the education system to the businesses that desperately need them?

Sajid Javid: I congratulate my hon. Friend on becoming Chair of the Education Committee. He is right to talk about the link between better skills and increased productivity, and I hope that in his new role he can make a valuable contribution to that.

Michelle Thomson (Edinburgh West) (SNP): Given that we are five years into the long-term economic plan and regrettably our productivity is 17% lower than the average among G7 economies, with growth in the EU 5% over the same period, why does the Minister believe that productivity will rise during the lifetime of this Parliament, since it fell during the last Parliament?

Sajid Javid: I welcome the hon. Lady to her place. She is right to point out the challenges of productivity, which have been a long-term challenge for this country. I hope she recognises that over the past five years the previous Government did a huge amount to turn around the economic fortunes of this country. We are the fastest-growing country in the G7, and just today we saw the Office for National Statistics revise growth figures for last year. That means thousands of jobs throughout Britain, including Scotland, making us the jobs factory of Europe.

Michelle Thomson: The Scottish Government, of course, are focused on growing our economy, using our four Is—innovation, internationalisation, investment and inclusion. Will the Minister support the Scottish National party call for a change to remove the sudden decrease in the investment allowance from £500,000 down to £25,000 from 1 January 2016 to help continue our success?

Sajid Javid: If the SNP wants to help business in Scotland, it should look at deregulating much more. In many of the areas that are devolved to Scotland, whereas the UK Government have been working hard to cut regulation, the Scottish Government have been working hard to boost regulation. Deregulation is one of the best ways to help productivity and growth in Scotland.

Superfast Broadband (Rural Areas)

6. Rebecca Pow (Taunton Deane) (Con): What discussions he has had with the Secretary of State for Culture, Media and Sport on the importance of superfast broadband to rural businesses. [900635]

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The Minister for Culture and the Digital Economy (Mr Edward Vaizey): There have been no recent discussions between the Business Secretary and the Culture Secretary, but as the Secretary of State for Business was the Secretary of State for Culture and therefore responsible for the broadband programme, a meeting is not necessary at this moment.

Mr Speaker: He can talk to himself.

Rebecca Pow: The second phase of the connecting Devon and Somerset superfast broadband programme has not been signed this week, and this could have an enormous negative impact on the economy of my constituency, Taunton Deane. For example, one business, the British Association for Shooting and Conservation, has recently moved from Staple Fitzpaine, taking eight rural jobs with it because it had no broadband. Please will the Minister intervene urgently to ensure that this vital service is provided not just for Taunton Deane, but for the whole of Somerset?

Mr Vaizey: I am delighted to welcome my hon. Friend to her place. Within weeks of arriving here, she is already proving that she will be a champion for her constituents, particularly on this issue. I am delighted that 52,000 premises in her constituency have superfast broadband. Another 10,000 will get it and I will continue to work with her and all MPs in Devon and Somerset to ensure that the broadband roll-out programme goes to plan.

Tom Elliott (Fermanagh and South Tyrone) (UUP): Has the Minister had any discussions with the devolved institutions about co-operating on rural broadband? The providers are UK-wide and there are opportunities for such discussions.

Mr Vaizey: We work closely with the Northern Ireland Executive on the issue. Something like £23 million is helping to roll out superfast broadband in Northern Ireland and get it to the level it should be at.

Mr Ranil Jayawardena (North East Hampshire) (Con): My hon. Friend the Member for Taunton Deane (Rebecca Pow) was right to mention rural businesses. Does the Minister agree that it is important for BT and others to streamline the way in which local authorities can provide match funding to help the final 5%?

Mr Vaizey: Yes. The success of the broadband programme so far means that focus is now turning to the final 5%, and in the next few months we will announce our plans to deliver for them. I am delighted that some £14 million has helped Hampshire get to 89%, and phase 2 will take it to 96%.

Carolyn Harris (Swansea East) (Lab): Does the Minister think that it is acceptable that in half the Government’s enterprise zones firms do not have full access to superfast broadband?

Mr Vaizey: It is important that we get superfast broadband to as many businesses as possible. I was delighted that last week we were able to say that 25,000 businesses have taken advantage of our excellent voucher scheme.

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Small Businesses (Lincolnshire)

7. Stephen Phillips (Sleaford and North Hykeham) (Con): What assessment he has made of the effects in Lincolnshire of the Government’s policies on small businesses. [900636]

The Minister for Small Business, Industry and Enterprise (Anna Soubry): Between 2010 and 2014 the number of private sector businesses in the east midlands increased by 28,000. Last week it was an absolute pleasure to meet representatives from local enterprise partnerships right across the midlands, including from Lincolnshire. There was such enthusiasm to make the midlands the engine that we want it to be, replicating the northern powerhouse —[Interruption.] I am sorry that Opposition Members find that funny; I thought that they would have welcomed the northern powerhouse, as their Labour colleagues in those local authorities do. In any event, we know that small businesses are at the heart of our long-term economic plan.

Stephen Phillips: I am grateful to my right hon. Friend for that answer. She will want to join me in welcoming the latest figures, which show that employment in the north-east, the north-west and the east midlands is growing faster than in London. Will she ensure that that record of seeing growth and prosperity outside London continues, reflecting this Government’s one nation approach?

Anna Soubry: I completely endorse my hon. and learned Friend’s sentiment and absolutely agree with him. Between 2010 and 2014, 58% of net new jobs were created outside London and the south-east, whereas between 2004 and 2010 the figure was only 37%. That is further evidence that our long-term economic plan is working.

Several hon. Members rose

Mr Speaker: Order. The Minister has broadened the question a bit, which she is perfectly entitled to do, but not to the extent that it would encompass Northern Ireland, Merseyside or even west Yorkshire. Those Members will have to await their opportunity.

Mr Dennis Skinner (Bolsover) (Lab) rose

Mr Speaker: Ah, the hon. Gentleman is stirring in his den. Mr Skinner.

Mr Skinner: I have listened carefully for the past half an hour to find out exactly what the Tory Government are trying to do about places in the east midlands such as Bolsover, which is very close to Lincolnshire, because when the Labour Government were in power, both myself and Gordon Brown, the then Chancellor of the Exchequer, were the northern powerhouse. I asked him for 40 million quid to flatten the pit tips at Markham Vale, and he gave it me. Then I asked for some more money for an interchange straight up the M1 into Markham pit yard, and I got that as well. We were fixing the roof while the sun was shining. We don’t want none of this claptrap about the Tory northern powerhouse. [Interruption.]

Anna Soubry: I thought—[Interruption.]

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Mr Speaker: Order. We must hear the answer.

Anna Soubry: I thought that we were about to call for a Division during that so-called question. Let me remind the hon. Gentleman what his real record is. The real record is one of the longest and deepest recessions in our country’s history. The real record is bringing this nation to the verge of bankruptcy. Instead of talking down the east midlands—and I am an east midlands person through and through—the hon. Gentleman should be talking it up, and rightly so. From my experience, we will see the creation of a midland engine that will give us the long-term growth and the jobs of the future that his party failed to deliver.

Karl McCartney (Lincoln) (Con): Considering the growth of business opportunities in our county and particularly in the city of Lincoln, will the Minister build on the recently announced £130 million investment in the University of Lincoln, a chief component of the midlands engine, and grant us enterprise zone status?

Anna Soubry: I am very happy to provide a triumph for Lincoln, given that it is the city of my birth. In any event, I am very happy to meet him to talk about the future of the university and the real role it can play. As I have said—forgive me for repeating it, Mr Speaker—I have met all the representatives of the LEPs from right across the midlands. Indeed, we talked about Lincoln University and the real desire to create a midlands engine, and rightly so.

Mr Speaker: It has to be said that repetition is not a novel phenomenon in the House of Commons.

Business Regulation

8. Helen Whately (Faversham and Mid Kent) (Con): What steps he is taking to reduce regulation of businesses. [900637]

The Minister for Small Business, Industry and Enterprise (Anna Soubry): As we have heard, the Government are committed to reducing the regulatory burden on all businesses. The one in, two out initiative has put a real brake on the introduction of new regulations. Through the enterprise Bill, we will target regulators’ actions as part of our commitment to cut a further £10 billion of red tape for the benefit of businesses.

Helen Whately: I thank my right hon. Friend for her answer. There are many pubs in my constituency, as well as the Shepherd Neame brewery and the Whitstable brewery. These local businesses are important as employers, and for their role in rural communities. Outdated bureaucracy is one more hurdle for them to overcome. For instance, pubs are required to advertise changes in their licence, costing about £500 a time, and many local authorities require licence fees to be paid by cheque, rather than allowing more modern methods of payment. What steps will the Government take to reduce the burden of bureaucracy on pubs and breweries?

Anna Soubry: I welcome my hon. Friend to her place and thank her for her question. She provides examples of exactly the sort of regulation that we are seeking to look at and, indeed, to remove if necessary. That is

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why I will shortly announce a new Twitter account, @CutRedTapeUK, which no doubt—




It is all right. I am familiar with Twitter—oh, yes—and hashtags. I am trying to make the very serious point, which may be lost on Opposition Members, that we want to hear from businesses, and indeed from anybody, about the red tape, regulation and the burden it imposes, notably on small businesses, so that we can cut it.

20. [900649] Nick Smith (Blaenau Gwent) (Lab): The summer sporting and music calendar is in full swing, but fans are being let down by shady ticket sellers. This week, Taylor Swift fans are disappointed after the company from which they have bought tickets online disappeared without trace. When can we have better regulation of the secondary ticket market so that fans are not ripped off? [Interruption.]

Anna Soubry: I have heard of Taylor Swift, too. We are doing a review of that because we recognise that there is a problem. [Interruption.] The hon. Gentleman is straining to hear above all the chuntering on the Benches in front of him. I think my hon. Friend the Minister for Skills has responsibility for that—we are aware of the problem and we are doing a review—but I am more than happy to meet him to talk about it.

Michael Fabricant (Lichfield) (Con): Does my right hon. Friend agree that key to reducing regulation will be renegotiation in Brussels, so will she #congratulate the Secretary of State, who is sitting right by her, for his brilliant speech last night to the CBI, telling it that to argue against Brexit is madness before we have actually renegotiated anything?

Anna Soubry: I think I should just say yes, Mr Speaker, but I would add that my right hon. Friend the Secretary of State was actually talking about all businesses, not just those here.

Bill Esterson (Sefton Central) (Lab): I am sure that businesses will tell the Minister on Twitter what they told Ernst and Young, which is that the number of regulations has gone up, not down, under this Government. Is not the reality that this Government are all talk and no action when it comes to getting rid of regulations?

Anna Soubry: I am tempted to say, “The hon. Gentleman would know, wouldn’t he?” I am really surprised at his churlish attitude, and I absolutely do not agree with what he has been told. We know, because it was properly evaluated, that under the previous Administration we actually achieved £10 billion of savings for businesses by cutting red tape. The hon. Gentleman should welcome and praise that.

Small Businesses (Prompt Payment)

9. John Mc Nally (Falkirk) (SNP): What steps he is taking to encourage prompt payment to small businesses. [900638]

The Minister for Small Business, Industry and Enterprise (Anna Soubry): The Government are leading the way in paying their suppliers promptly. We have already legislated to “cascade”, as it says here, 30-day terms throughout public sector supply chains. We have also legislated for

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new transparency measures in the public and private sectors, which will allow full public scrutiny of payment performance. We will go further and consult on our proposals for a small business conciliation service.

John Mc Nally: There are many roofing businesses and other small and medium-sized enterprises in Falkirk, and the time and effort involved in chasing late and incomplete payments is a serious burden on them. What plans do the Government have to ensure that the onus is on large contractors to pay, as opposed to SMEs having to chase?

Anna Soubry: I completely take the point, and I thank the hon. Gentleman and welcome him to his place. As he will understand, smaller businesses are often reluctant to take action through law. That is why we are considering a conciliation service, which could provide a genuine answer. I would be delighted to come to Falkirk at some stage on my travels and meet some of the companies in question to assure them that we are on their side.

Huw Merriman (Bexhill and Battle) (Con): According to the Federation of Small Businesses, half of small firms were paid late last year. What progress has the Minister made in ensuring that large firms do not take advantage of small businesses in their supply chain and risk livelihoods in the process?

Anna Soubry: I take a firm view that it is absolutely scandalous when people do not honour the terms and conditions of their contract and pay late. That is not acceptable, particularly in the modern world. I hear terrible stories about supermarkets; one can only imagine what would happen if someone went shopping on a Saturday and then said at the checkout, “I think I’ll settle my bill in about 120 days.” Obviously they would be told that it was not acceptable, and it is not acceptable for large businesses to treat smaller businesses in that way. That is why we take the problem so seriously.

Toby Perkins (Chesterfield) (Lab): I very much welcome the tone that the Minister is taking, which is in sharp contrast with the feebleness of the Government’s efforts on late payments over the past five years.

Some 2,500 businesses go bust every year not because of a failed business model but simply because they have not been paid on time. Some £46 billion is now owed to UK firms, a figure that rose throughout the Government’s previous term. Will the Minister take serious action, and does she agree that the last Government’s actions were inadequate? What message will she send to businesses that do not pay on time about the actions that the Government will take?

Anna Soubry: I hope that I have sent a strong message. I could not be clearer—it is completely unacceptable. [Interruption.] There is no need to add extra regulatory burdens. The law is quite clear: if two parties have come together and settled terms and conditions through a contract—forgive me for sounding like the lawyer I am, Mr Speaker—and one party then breaks the contract by not paying on time, legal action is available to the other party. As we know, the problem is that small

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businesses are understandably reluctant to go to law. I am exploring other options, including the continuation of naming and shaming.

Business Competitiveness

10. Mr David Nuttall (Bury North) (Con): What steps he is taking to increase the competitiveness of UK businesses. [900639]

The Minister for Small Business, Industry and Enterprise (Anna Soubry): The World Bank recognises the United Kingdom as one of the best places in the world to do business, ranking us eighth. We committed in our manifesto to make the UK No. 1 in Europe and in the top five worldwide in the Doing Business rankings by 2020.

Mr Nuttall: Does the Minister agree that for millions of small businesses that never export to the European Union, either because they simply serve the domestic market or because they export only to countries outside the EU, the regulations imposed by Brussels are a burden that damages their ability to compete?

Anna Soubry: I absolutely recognise, and the Government recognise, that EU regulations can hit small and medium-sized businesses particularly hard, which is not right or fair. A key priority of our European better regulation agenda is continuing to ensure that the European Commission honours its commitment to introducing lighter regimes for SMEs and exemptions for micro-enterprises where appropriate.

Mr Barry Sheerman (Huddersfield) (Lab/Co-op): Surely the Minister realises that if we want our businesses to be more competitive, we have to look to skills. Has she seen Professor Alison Wolf’s report “Heading for the Precipice”, which is a damning comment on the lack of skills training in this country and the crisis in further education and adult skills?

Anna Soubry: Not only did we deliver 2 million apprenticeships—

Mr Sheerman indicated dissent.

Anna Soubry: The hon. Gentleman shakes his head, but that is a fact. He does not like to hear the facts. There were 2 million apprenticeships under the previous Government, and we are determined to achieve 3 million. That is the way we upskill in our country. He should look at the Labour party’s record in government; it was pitiful compared with ours.

Mr Speaker: The hon. Member for Huddersfield (Mr Sheerman) is supposed to be a statesman in the House—[Interruption.] Order. He should be setting an example. It is not a two-way debate. He blurted out his question and he must listen to the answer.

Business Support

11. Kit Malthouse (North West Hampshire) (Con): What steps his Department is taking to support people who want to start their own business. [900640]

Mr Speaker: I call Anna Soubry—[Interruption.]

30 Jun 2015 : Column 1328

The Minister for Small Business, Industry and Enterprise (Anna Soubry): I am more than happy to answer questions.

More than 30,000 people have benefited from more than £155 million worth of loans expert business advice provided by the Start-Up Loans company, and around 70,000 unemployed people have set up their own businesses with the help of the new enterprise allowance scheme. The business support helpline provides free expert advice to help people start their own businesses in England.

Kit Malthouse: North West Hampshire is literally pullulating with people such as Joanne Bishop of Atalanta Jewellery who pluck up their courage and their savings to start their own business. They often have a skill or an idea that they want to put into action, but they lack the expertise to do so, and are often faced with the might of the state. Will the Minister outline what she and her Department will do to provide support to entrepreneurs in future, particularly in taking on the Government?

Anna Soubry: I think “pullulating” is a parliamentary word, Mr Speaker, but I think it was a new one on both of us.

We take that issue seriously and various schemes are available, including the business support helpline. I would be more than happy to meet my hon. Friend, who I welcome to his place, to discuss the issue. Ensuring that once people have started a business they can continue to grow it and get support, is an issue we take seriously.

Mr Speaker: I have been advised by a scholarly source that “pullulating” means to breed rapidly or abundantly. We are immensely grateful to the hon. Member for North West Hampshire (Kit Malthouse) for his dexterity in the English language.

Stella Creasy (Walthamstow) (Lab/Co-op): Like me, the Minister will no doubt be concerned that only one in five of those new start-up businesses is led by women. I know that she is keen on Twitter accounts, but let me give her a better idea of something that her own Department came up with, although sadly her predecessors refused to implement. Will she commit to monitoring selling to businesses led by women in the supply chain, and help to get British women back into business?

Anna Soubry: We know that more women are employed now than ever before. Call me an old-fashioned feminist but—[Interruption.] I understand that Opposition Members could call me far worse than that. I support the many wonderful initiatives that have been introduced to encourage women to come into business and set up their own businesses. It is striking, however, that all the meetings I have had with big businesses have been very male-dominated. We find an abundance of women in the small business sector—[Interruption.] The hon. Lady shakes her head but that is a fact, and that is because women have so much talent.

Science Sector

12. Antoinette Sandbach (Eddisbury) (Con): What plans he has to support the science sector in the next five years. [900641]

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The Minister for Universities and Science (Joseph Johnson): In the previous Parliament the Government demonstrated our commitment to science by protecting the science budget, even as we were forced to make discretionary savings of £98 billion elsewhere. Over the next five years, as we saw in our manifesto, our commitment to science will run through it like the words in a stick of rock. We have reaffirmed our commitment to investing £1.1 billion of science capital, rising every year until 2021, including £2.9 billion on grand challenges.

Antoinette Sandbach: Thornton science facility was handed by Shell to Chester University, which is attended by many of my constituents. With large, high-skill employers such as Airbus, Bentley and others in the north-west, what more can my hon. Friend do to link employers to educational institutions and encourage the uptake of STEM— science, technology, engineering and maths—subjects?

Joseph Johnson: I agree with my hon. Friend that Thornton science park deserves national recognition as an exciting regional centre for innovation, enterprise and higher education. I also welcome the strong leadership from the University of Chester in drawing together an impressive range of partners from business and academia. We need to see more such collaboration between universities and business all over the country.

Daniel Zeichner (Cambridge) (Lab): Does the Minister appreciate that many of our great scientists at places such as the Babraham Institute and the Laboratory of Molecular Biology in Cambridge are civil servants and stuck on the civil service pay freeze, and are being offered much better terms abroad? Will we compete? It is time to do so.

Joseph Johnson: All parts of the public sector have been obliged to contribute to the national savings effort undertaken in recent years, but I would note to the hon. Gentleman that research councils have been exempted from those constraints and, as a consequence, have been able to compete around the world in attracting the best scientists to this country. They are doing so extremely effectively.

Liam Byrne (Birmingham, Hodge Hill) (Lab): Our universities are critical to the strength of our science base, but following the tripling of tuition fees in the last Parliament, four out of five students no longer think that their courses are value for money. The Minister’s predecessor said that he saw no case for raising tuition fees in this Parliament. What does the Minister think? Will tuition fees go up in this Parliament? A simple yes or no will do.

Joseph Johnson: Due to the financial situation we inherited, we are of course forced to review all BIS spend—as all Departments are reviewing their spend. As our manifesto made clear, the Government are committed to continuing to ensure that we have a stable and sustainable funding regime for our universities and higher education institutions. They are secure and financially stable, and we will continue to ensure a fair balance of interests between taxpayers and students.

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Low-skilled Jobs

13. Christina Rees (Neath) (Lab): What recent estimate he has made of the proportion of jobs in the economy which are low-skilled. [900642]

15. Melanie Onn (Great Grimsby) (Lab): What recent estimate he has made of the proportion of jobs in the economy which are low-skilled. [900644]

The Minister for Skills (Nick Boles): We are focused on increasing the number of jobs at all levels of skill and on investing in 3 million apprenticeships, which will help people to improve their skills and command higher wages.

Christina Rees: The Welsh Labour Government have created more than 17,000 job opportunities for 16 to 24-year-olds to develop skills and earn the minimum wage through their flagship scheme Jobs Growth Wales. Some 82% have been taken on by private firms, which has led to apprenticeships, further education and permanent work. Jobs Growth Wales has also enabled more than 270 young entrepreneurs to start new businesses. Does the Secretary of State have plans to roll out similar schemes this side of Offa’s Dyke?

Nick Boles: We welcome efforts by all parts of the UK to grow jobs and apprenticeships, and we have our own policies here. We will produce 3 million apprenticeship starts at all levels over the next five years, but we welcome anything else that the Welsh Government do to create jobs and apprenticeships.

Melanie Onn: Thanks to Labour’s groundbreaking commitment to tackling climate change, investment in wind energy in Grimsby has created much needed high-skilled jobs in our local economy. With 25% of our young people not in education, employment or training, support for that industry is essential for my constituents’ future, but the Government have now announced the removal of subsidies for onshore wind. What effect does the Minister expect that to have on investor confidence in the offshore wind sector?

Nick Boles: It is not my area but, as the hon. Lady said, the cut in subsidies is for onshore wind. Her constituency is focused on offshore wind, where the Government’s support is committed and going up. I welcome the high-skilled jobs that that support is bringing to her constituency, which has seen a 38% fall in the number of people claiming benefits since 2010.

Topical Questions

T1. [900620] Kit Malthouse (North West Hampshire) (Con): If he will make a statement on his departmental responsibilities.

The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid): May I first pay tribute to my predecessor, the equally hirsute former Member for Twickenham? As part of the coalition Government, Dr Cable did a great deal to support British business.

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Speaking of former members, I see that last month Lord Sugar resigned his membership of the Labour party, citing its negative business policies and general anti-enterprise approach. It seems that while the Government are busy creating 3 million more apprenticeships, Lord Sugar has told the Opposition that they are all fired.

Kit Malthouse: As a small businessman—I draw the attention of the House to my entry in the Register of Members’ Financial Interests—I welcome the Government’s work in the past four years to roll back the red tape that has dogged small businesses. Now that the Government are firmly in control of the Department, can Ministers reassures us that they will redouble their efforts? In particular, will they develop measurable targets, for cutting red tape and administration for small business, against which we can measure success?

Sajid Javid: I fully agree with my hon. Friend. We will continue to work very hard to cut regulations, building on the very successful red tape challenge in the previous Parliament and the policy of one in, two out. Cutting regulation for businesses is like a tax cut for those businesses. The only difference is that it does not cost the Exchequer anything, so we should cut as much regulation as possible.

Mr Chuka Umunna (Streatham) (Lab): Britain has the worst productivity in the G7, bar Japan. Proper adult skills provision, not just apprenticeships, plays a vital role in addressing that, but the adult skills budget has been cut by 35% in the past five years. Now the Chancellor tells us that a further £450 million is to be taken out of the Department’s budget, which could lead to the end of further education as we know it. In the light of these very real concerns, what assessment has the Business Secretary undertaken on the risks posed for the sector? Will he now guarantee that no college will close as a result of what he and the Chancellor are going to do?

Sajid Javid: One of the most important things for businesses, and for a vibrant economy, is making sure we continue to deal with the record budget deficit we inherited from the previous Labour Government. The hon. Gentleman knows that himself. He has been busy telling the press very recently:

“to be running a deficit in 2007, after 15 years of economic growth, was…a mistake.”

He understands the importance of this, and it means the Government have to make difficult decisions. He also said very recently to the Financial Times that

“We are starting from square one.”

I think he was talking about the economic credibility of the Labour party. I do not think that was an accurate statement; I think he was—

Mr Speaker: Order. The Front-Bench exchanges have to be brief. A lot of Back Benchers want to get in. It is very self-indulgent to have these long-winded exchanges from the Front Bench.

Mr Umunna: When consolidating, you have to make appropriate choices—you do not want to cut off your nose to spite your face. If we want to increase revenue, we need to increase productivity. Look at South

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Gloucestershire and Stroud College, which the Secretary of State attended: this month it confirmed that 70 staff posts are in danger due to the reduction in its adult learning funding. The principal of that college said:

“we need to reduce our costs in line with the reduction in funding to maintain our solvency.”

Should the alarm bells not be ringing when his own college is citing issues of solvency before we have seen the full scale of what he is going to do to the productive capacity of the economy?

Sajid Javid: It was an excellent college—[Hon. Members: “Was!”] And it still is. I know many people who attend the college and they speak of it very highly. The important point is that all colleges, not just that college, have the resources they need to do their jobs. We will not put that at risk, especially as they continue to invest in apprenticeships, which are one of the surest ways to give people the training they want and to ensure they have skills that are wanted in the marketplace.

T3. [900622] Bob Blackman (Harrow East) (Con): I have been contacted by further education colleges in my constituency that are concerned about the decisions being made in-year to reduce funding. Will my right hon. Friend lay out a strategy that enables colleges to have a five-year programme, even if it means a gradual reduction in funding?

The Minister for Skills (Nick Boles): I know my hon. Friend recognises that difficult choices have had to be made and will have to be made during the spending review to bring the deficit down. It is that process of deficit reduction that has led to the massive growth in employment. I absolutely hear the argument he makes. Long-term certainty would be of tremendous value to colleges, and I will definitely make sure that that argument is made.

T2. [900621] Jeff Smith (Manchester, Withington) (Lab): Will the Secretary of State tell me what discussions he has had with the Secretary of State for Transport to ensure that business and growth do not suffer as a result of the delay to the electrification of the trans- Pennine line?

Sajid Javid: I was disappointed by that recent news, because it is important that we continue to invest in infrastructure—not least for increased productivity and, therefore, jobs growth. I have not yet had a discussion with the Transport Secretary, but I am looking forward to doing so.

T5. [900624] Mr Christopher Chope (Christchurch) (Con): Does my right hon. Friend think that the CBI’s poverty of ambition for a radical new relationship with the EU is attributable to the fact that the CBI receives funding from the EU?

Sajid Javid: The point I made yesterday to the CBI was not just about the CBI, but was a call to all business groups. The best way to get the EU reforms that many of them seek is for them to help the Government with their negotiations, speak to their partners in other European countries and then make up their minds at the end of the process.

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T4. [900623] Simon Danczuk (Rochdale) (Lab): I am sure the Secretary of State will agree that helping businesses to grow and develop is a key aim of the devolution and northern powerhouse agendas. Will he explain, therefore, why the word business does not appear anywhere in the Cities and Local Government Devolution Bill?

Sajid Javid: Not only do I agree with the hon. Gentleman about the importance of business, but my father’s first business began in his constituency, so I understand the importance of this to people in Rochdale and elsewhere. It is important that the word “business” and the importance of business appear throughout Government policy, as they do in the Conservative manifesto and, as I am sure he will hear next week, in the Budget.

T6. [900625] Paul Maynard (Blackpool North and Cleveleys) (Con): Low-paid workers in my constituency will have been pleased to see the first above-inflation rise in the minimum wage since the financial crash, but what more can the Government do to encourage employers to pay the living wage where affordable?

Nick Boles: My hon. Friend is absolutely right. It is tremendously welcome that, as a result of the recovery, it has been possible for the Government to implement this second increase in the minimum wage—and the first that is higher than the rate of increase in both inflation and average earnings—which takes the minimum wage to £6.70. We want any employer that can afford to pay the living wage, without losing jobs, to do so, and we encourage them all to think of doing so soon.

T9. [900628] Melanie Onn (Great Grimsby) (Lab): Workers at the Young’s Seafood factory in Grimsby are worried for their futures after Sainsbury’s ended a contract with it. Grimsby already has the 17th highest unemployment rate in the country, and in the past few years it has seen several established companies leave the area, leaving behind nothing to replace them. Given that the Young’s site provides 500 skilled jobs, what support can the Government offer to avoid further losses of skilled jobs?

The Minister for Small Business, Industry and Enterprise (Anna Soubry): Officials from my Department have already met people at Young’s in her constituency, following the question from my hon. Friend the Member for Cleethorpes (Martin Vickers). Those meetings are continuing. I assure the hon. Lady, however, that if it is bad news, all the good support she would imagine coming from the Department for Work and Pensions to make sure people can find new work will be put in place. None the less, I am more than happy to meet her and my hon. Friend to discuss the matter.

T7. [900626] Andrew Bingham (High Peak) (Con): The Minister knows my background and support for small businesses in High Peak. I am delighted that 135 new businesses were set up in my constituency in the last Parliament, leading to more than 4,000 new apprenticeships. Will he tell me and my constituents what plans he has to build on this record, see unemployment fall and provide more opportunities across High Peak, particular for young people?

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Nick Boles: My hon. Friend reminds us that this is a “one nation” recovery that is benefiting all parts of the country, including his own stunningly beautiful constituency. We are determined over the next five years to create thousands more businesses, millions more jobs and millions more apprenticeships for his constituents and the constituents of all hon. Members.

Mr Iain Wright (Hartlepool) (Lab): May I congratulate the Secretary of State on his appointment and wish him and his ministerial team every success? On Thursday, he announced the sell-off of part or all of the UK Green Investment Bank, but it is unclear what proportion will be sold off. When it was established in 2012, the bank’s impact assessment said it was the only option that addressed market failure and barriers. How have these market failures been fully addressed and how will the Government’s sketchy plans for the most active green investor in the UK not undermine market confidence?

Sajid Javid: I congratulate the hon. Gentleman on being elected Chairman of the Business, Innovation and Skills Select Committee and look forward to working with him. Since it was set up three years ago, the UK Green Investment Bank has been very successful. In fact, this year, for the first time, it is expected to turn a profit. I want to make it stronger and even more successful, however, and one of the best ways to do that is to ensure it can access both private capital and private equity—

Mr Speaker: Order. I call Michael Tomlinson.

T8. [900627] Michael Tomlinson (Mid Dorset and North Poole) (Con): I welcome the Government’s work to encourage businesses to take more people on by reducing the burden of employment law, helping more people in my constituency to get into work. What reassurance can the Secretary of State give me that he will further reduce the burden of regulation, thus helping businesses in Mid Dorset and North Poole and across the country?

Anna Soubry: I welcome my hon. Friend to his place. As he has heard, it is an absolute priority for the Government to continue the great work we achieved over the last five years, with £10 billion-worth of saving by deregulation and a promise of £10 billion more to come in the next five years. I look forward to working with my hon. Friend and others—via Twitter or whatever—so we can find out where the regulations are that do not need to be there, get rid of them and make sure that we keep Britain working.

Wes Streeting (Ilford North) (Lab): Having failed to rule out a hike in university tuition fees during this Parliament, can the Minister rule out at least that there will be no changes either to tuition fee levels or the terms of repayment on student loans for existing students and graduates? Yes or no?

The Minister for Universities and Science (Joseph Johnson): The hon. Gentleman has previous experience as president of the National Union of Students, so it is valuable to us to have him here. He will know that the OECD has praised the UK as being one of the only countries in the world to have come up with a sustainable way of funding higher education, and this Government

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have every intention of continuing to ensure that our higher education system is funded successfully and sustainably over the years ahead.

T10. [900629] Amanda Milling (Cannock Chase) (Con): Small businesses are a substantial part of the local economy of my constituency. I was pleased to welcome the news that, since launch, 22 people have already taken up start-up loans worth nearly £140,000 to start new businesses in Cannock Chase. However, relatively speaking, this is low. What steps are the Government taking to encourage more people to take advantage of this scheme in areas such as my constituency?

Anna Soubry: I welcome my hon. Friend to her place. We know that start-up loans have led to considerable success. One thing I am keen to do is to ensure that we keep all small businesses, especially entrepreneurs and people looking to start up their business, well informed and absolutely aware of the various schemes available to them. I know the British Business Bank, through its website and other media, can provide that information, and I want to make sure that it is working, so that in the real world, people have access to funds, to schemes and the advice they often need when starting up their business.

Susan Elan Jones (Clwyd South) (Lab): The Secretary of State will be aware of the great concern about the Government’s failure to meet export targets. With UK Trade & Investment’s own surveys saying that more than a quarter of businesses reckon that there is no business benefit from UKTI, how does he propose to deal with this problem?

Sajid Javid: We have seen some growth in exports over the last five years, but not enough. This remains a challenge, which means looking carefully at UKTI and improving what it does. That is exactly what the Minister for Trade and Investment, Lord Maude, is doing. The hon. Lady may know that we have seen record inward investment, which is also important and a job of UKTI to promote. It has now topped £1 trillion—the highest in Europe.

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Stephen Hammond (Wimbledon) (Con): The Secretary of State will know that from this September, companies will have two years in which to introduce the new general data protection regulations, estimated to cost £2 billion. Will he ensure that his Department does all it can to minimise costs and to make industry aware, so that they can comply within the timescale?

Anna Soubry: I thank my hon. Friend for his question; he makes an important point. I know my diary is going to get busy, but I would very much welcome a meeting to discuss this with him because—[Interruption.] I do not know why Labour Members seem to be complaining about Ministers meeting Back Benchers—I would be happy to meet even the right hon. Member for Birmingham, Hodge Hill (Liam Byrne). I look forward to working with my hon. Friend on this important matter, of which we are aware. We must make sure that we do this properly.

Gavin Robinson (Belfast East) (DUP): Has the Secretary of State had an opportunity to consider last week’s report from the Northern Ireland Consumer Council, which highlights the barriers to online consumers getting postage to Northern Ireland, the islands or the highlands of the United Kingdom? What steps can the Secretary of State take to create, dare I say it, a “one nation” consumer market where the inhibitors and the barriers are removed once and for all?

Sajid Javid: I have not yet had an opportunity to look at the report, but now that the hon. Gentleman has mentioned it, I shall certainly do so, and I shall then be able to respond to him on the issue that he has raised. He may be interested to know, however, that just today it was reported that consumer confidence throughout the United Kingdom had hit a 15-year high, which means that the Government’s long-term economic plan is working.

Several hon. Members rose

Mr Speaker: Order. I am sorry, but we must move on.

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Points of Order

12.35 pm

Angus Robertson (Moray) (SNP): On a point of order, Mr Speaker. Have you received any notification from the Government that they intend to announce plans on Thursday to restrict the rights of Scottish Members of Parliament here in the House of Commons, even if the matters concerned have an impact on the Scottish budget? The Daily Telegraph reports today:

“Number 10 hopes to use an obscure parliamentary procedure known as standing orders to lock Scottish MPs out of shaping legislation that only affects English voters. The move needs just a single vote of approval from MPs to be put into law in a move that would circumvent the months of parliamentary scrutiny which comes with full legislation.”

Have you been given any notice of those proposals, Mr Speaker, and have there been any discussions with you about the potential role of the Speaker in certificating such procedures?

Mr Speaker: I have a number of things to say to the hon. Gentleman. First, in so far as there are periodic discussions on a wide range of matters involving the Chair, those discussions take place properly between the participants. The matters that are discussed are not aired on the Floor of the House. I hope that the hon. Gentleman will respect the significance of that principle and its application in this context.

Secondly, I have received no formal notification whatsoever of Government intentions on the matter relating—as the hon. Gentleman said—to Thursday. I think the hon. Gentleman knows that this is an issue that has been discussed over a period, and, if memory serves me, his right hon. Friend the Member for Gordon (Alex Salmond) aired it only the other day in a point of order; so it is not a novel concept.

Thirdly, let me say very gently to the hon. Gentleman, who is an experienced denizen of the House, that he is far too worldly wise to be beguiled or swept along by the journalistic licence that causes a scribe to refer to Standing Orders as an obscure device. There is nothing obscure about Standing Orders. The hon. Gentleman, exercising his customary patience and statesmanship, must await the development of events.

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Mr Barry Sheerman (Huddersfield) (Lab/Co-op): On a point of order, Mr Speaker. It concerns yesterday’s business. Some of us were very concerned about the mixed nature of the Prime Minister’s statement. Many of us thought that two separate statements would have been more appropriate. Did you take that into consideration, Mr Speaker, when the Prime Minister made his request to make a statement? Some of us found it very awkward that a tragedy—a deeply felt tragedy—was mixed up with a report from a European meeting that the Prime Minister had attended. They did not seem to us to sit well together.

Mr Speaker: I am grateful to the hon. Gentleman, who is a very experienced Member of the House. The short answer is that it was entirely a matter for the Prime Minister. Let me add—just to put the matter in context, and so that the hon. Gentleman is not misled—that it would always be a matter for the Minister in question, whether that Minister be the Prime Minister or any other Minister. I note what the hon. Gentleman has said, and it should be heard on the Treasury Bench, but it is still a matter for Ministers to decide.

In the circumstances—and I think that the Prime Minister had very good intentions in seeking to address the House on both subjects, even if the hon. Gentleman did not think it was the right way to go about things—I thought that my role was to try to maximise the number of contributors, bearing in mind that some Members would want to raise the atrocious events in Tunisia, while others would be more focused on the matters appertaining to the European Union.

The hon. Gentleman is very experienced, and I think he will testify that exchanges on statements nowadays tend to last somewhat longer. My own view is that the interests of the House, rather than the convenience of a Minister, should come first. I know that that does not altogether meet the hon. Gentleman’s concerns, but he has put them on the record, so let us see how matters progress. He may find that, as he is somewhat of a sage, his counsel will be heeded in future.

I think that the point of order appetite has been satisfied. The Clerk will now proceed to read the Orders of the Day.

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Scotland Bill

[3rd Allocated Day]

Further considered in Committee

[Natascha Engel in the Chair]

Clause 19

Disability, industrial injuries and carer’s benefits

12.41 pm

Ian Murray (Edinburgh South) (Lab): I beg to move amendment 128, page 21, line 39, leave out from “of” to the end of line 7 on page 22 and insert

“a disabled person or person with a physical or mental impairment or health condition in respect of effects or needs arising from that disability, impairment or health condition.”

The current definition of ‘disability benefit’ used in the Bill is restrictive and could place unnecessary limits on the kind of replacement benefit the Scottish Government has the power to introduce. It may not, for example, allow the Scottish Government to introduce a benefit to assist people with very low level disabilities or those for whom the effect of their disability is largely



The Second Deputy Chairman of Ways and Means (Natascha Engel): With this it will be convenient to discuss the following:

Amendment 112, page 22, leave out lines 6 and 7.

Removes the word “short-term” in the clause devolving disability benefit. It is not clear what “short-term” means in this context, how it will be defined or whom it may exclude from receiving the benefit.

Amendment 48, page 22, line 45, leave out sub-paragraph (a).

Clause 19 stand part.

Amendment 115, in clause 20, page 23, line 27, after “financial”, insert “or other”.

This amendment would enable the provision of assistance, in relation to benefits for maternity, funeral and heating expenses, in a form other than



Amendment 49, page 23, line 33, leave out “8” and insert “9”.

Amendment 50, page 23, line 34, leave out “8” and insert “9”.

Clause 20 stand part.

Amendment 12, in clause 21, page 24, leave out lines 9 and 10.

Clause 21 stand part.

Amendment 129, in clause 22, page 24, line 27, leave out from “who” to “appears” in line 32.

The current Exception 6 would extend the power to provide discretionary housing payments only to those already in receipt of housing benefit. Those who lose entitlement to any housing benefit as a result of the under-occupancy charge are precluded from accessing discretionary housing payments. The amendment seeks to allow the Scottish Parliament to mitigate the impact of the bedroom tax.

Amendment 116, page 24, leave out lines 36 to 48.

This amendment would remove some of the restrictions, including those relating to sanctions, in relation to discretionary housing payments.

Amendment 13, page 24, leave out lines 36 and 37.

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Amendment 132, page 25, leave out lines 1 to 8.

The exception in the Bill could be problematic where claimants have had their housing benefit wrongly suspended. The amendment would allow the Scottish Parliament to provide discretionary housing payments in cases which might be regarded as arising from non-payability of a reserved



Clause 22 stand part.

Amendment 8, in clause 23, page 25, line 28, leave out “short-term”.

Amendment 117, page 25, leave out lines 30 to 37.

This amendment would broaden when discretionary housing payments can be made by removing some restrictions including those relating to sanctions.

Amendment 111, page 25, line 39, leave out “occasional”.

Amendment 131, page 25, line 45, at end add “or

(b) who are part of a family facing exceptional pressure.”

Clause 23 stand part

New clause 31—New benefits

“In Section F1 of Part 2 of Schedule 5 to the Scotland Act 1998, in the Exceptions, after exception 8 (see section 23 above) insert—

“Exception 9

A benefit not in existence at the relevant date provided entitlement to or the purpose of the benefit is different from entitlement to or the purpose of any benefit that is—

(a) in existence at the relevant date,

(b) payable by or on behalf of a Minister of the Crown, and

(c) otherwise a reserved benefit.

For the purpose of this exception—

“the relevant date” means the date of introduction into Parliament of the Bill that becomes the Scotland Act 2015;

“reserved benefit” means a benefit which is to any extent a reserved matter.”

This New Clause broadens the circumstances under which the Scottish Parliament can create new benefits, as recommended by the Smith



Ian Murray: This afternoon, we are competing with the BBC’s coverage of Wimbledon; I hope we do not damage its ratings as Andy Murray kicks off his tournament. Of course, everyone in the House wishes Andy Murray well—not just for today’s match, but for the rest of the tournament. We apologise in advance if nobody watches his tennis match because their eyes are focused on this Chamber.

It is a privilege to speak on the Bill’s welfare provisions, to move amendment 128 and to speak to the other amendments as well as the very important new clause 31, which stands in my name and those of other hon. Members. I hope that Scottish National party Members—I had called them a braying mob, but there are slightly fewer of them this afternoon than last night—will not implode when I start by complimenting them: we will support their amendments 115 and 131, to which I have also added my name.

This area of the Bill devolves to the Scottish Parliament new and substantial powers over welfare, transferring to it £2.5 billion-worth of welfare responsibility. This is a real opportunity for Scotland; today we could pass amendments that fundamentally transform the Scottish Parliament’s relationship with the welfare system. It would then be up to the Scottish Government of the

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day to design the system that they want, and that the Scottish people have voted for, and find the resources to pay for it.

As much as the SNP has been desperate to be disappointed by the Bill, its approach to the welfare section has been broadly similar to Labour’s. I think that the only major difference arises from the SNP amendments to devolve national insurance. As I said yesterday—perhaps this was lost in the melee of the debate—that is a perfectly legitimate amendment for a party that believes in independence, but we disagree with that fundamental principle. As the party of devolution, we believe in a strong Scottish Parliament within the UK. We passionately believe that it is in the best interests of all Scots and the rest of the United Kingdom that there should be a pooling and sharing of resources, redistributing wealth from the haves to the have-nots.

The Conservatives believe in the redistribution of wealth from the have-nots to the haves. Since 2010, the House has seen a sustained attack on the most vulnerable. It was not the poorest and most vulnerable who caused the worldwide recession, but the reckless gambling on the financial markets. That led to a Government income crisis, which led to a Government obsessed with austerity, and that has choked off demand in the economy, hitting the poorest hardest right across the United Kingdom.

There are many examples, but the most pernicious, unfair and unequal of those welfare changes must be the bedroom tax. It has hit the most vulnerable very hard for the sake of very few savings on the welfare budget. A further £12 billon of unfunded welfare cuts were announced at the general election, with no detail whatever about where they would fall.

The Government’s problem is that they are failing to deal with the welfare system’s underlying problems. For example, the lack of affordable and social housing is increasing the housing benefit bill as many are forced into the much more expensive private rented sector. I see that happening every single day in my constituency.

Alan Mak (Havant) (Con): There are reports in the press that Labour and the SNP are proposing to introduce higher welfare payments in Scotland and higher welfare bills, which the Bill would allow them to do. Does the hon. Gentleman not agree that both parties should spell out which taxes the Scottish people would have to pay to fund those commitments?

Ian Murray: We have a number of proposals relating to the Bill, including devolving housing benefit, which we will discuss this afternoon. We think that that money should be reinvested, wherever possible, in the building of social and affordable housing, because that would ultimately bring down the housing benefit bill. The hon. Gentleman tends to forget that if we invest to deal with the fundamental underlying problems in the system, we can bring the benefit bill down.

Getting people into work, introducing higher pay and building social housing to get people out of the more expensive private rented sector would all make a huge difference to the benefit bill. More money would then be available to reinvest in the system. Our double devolution proposals to get the Work programme, the Work Choice programme and Access to Work into

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the hands of the local authorities, which are in the best position to deliver them, would allow us to reinvest into the system. The Conservatives’ response of simply cutting the welfare bill rather than dealing with the fundamental underlying problems is the reason why the bill has been going up despite all the changes that the Government made during the last Parliament.

Let me make it clear that Labour is the only true guardian of the UK welfare system, supporting pensioners and the most vulnerable against Conservative cuts that will hit working people the hardest and against an SNP group determined to break up the system without having any idea of the consequences. That is why the Bill is so important. According to the House of Commons Library, if the Bill were passed in its present form, the Scottish Parliament would be responsible for 62% of all public expenditure. If the new clause proposing the devolution of housing benefit were passed, that figure would rise to 65%, but that is within the integrity of the UK welfare system.

Richard Graham (Gloucester) (Con): I know that the hon. Gentleman is a reasonable man, and I do not want him to get too carried away with his narrative of how beastly the Conservatives have been to the poorest people. In my constituency, no new social housing was built during the 13 years during which we had a Labour MP. Now, 100 new social houses have been started. His narrative is precisely the one that his party tried, and failed, to get across during the general election. Does he not agree that it is time to look at welfare in a completely different light?

Ian Murray: That might be the experience in the hon. Gentleman’s constituency surgeries on a Friday and Saturday, but it is not the reality for my constituents. Many disabled people, and all the disability and voluntary sector organisations that have contributed to these parts of the Bill, have said something completely contrary to what he has just said. That might be the experience in his own backyard, but it is certainly not what I see in my constituency. The Scottish Council for Voluntary Organisations, the Child Poverty Action Group, Shelter Scotland, Enable and many other disability charities have all said that the situation is completely contrary to the one he is describing. I do not think that having the lowest level of house building since the 1920s is anything to be proud of. We should be doing something about that, across the House.

Simon Hoare (North Dorset) (Con): The hon. Gentleman’s preamble was slightly depressing, because it failed to wake up to a fact that I thought Labour Front Benchers had woken up to—namely, that all his party’s intentions and warm words about welfare would come to nothing if they were not underpinned by a strong economy.

Ian Murray: I do not think that the hon. Gentleman was listening to my preamble, as he puts it, because I was talking about the underlying problems in the welfare system. They include: a lack of affordable social housing, which pushes people into the more expensive private rented sector, which pushes up the housing benefit bill; a lack of higher pay, which pushes up the benefit bill; and a lack of skills and opportunities to progress in the workplace and increase productivity, which also pushes

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up the welfare bill. Indeed, in Business, Innovation and Skills questions this morning, the Business Secretary said that the UK had a problem with productivity and that it had to be resolved. If we could resolve those three underlying problems in the welfare system, we might be in with a fighting chance of making life better for people in this country and of bringing the welfare bill down.

Andrew Gwynne (Denton and Reddish) (Lab): Is my hon. Friend suggesting that, although the baseline will always be the UK welfare system, lifting some of the restrictions that the Bill would place on the Scottish Parliament would allow it to build on the provisions?

Ian Murray: I shall come on to that. Indeed, new clause 31, which SNP Members have signed, too, incidentally, would essentially give the Scottish Parliament full power to introduce new benefits in all devolved areas and to top up any benefits in reserved areas. Anybody who wished to put together a manifesto for a Scottish parliamentary election would have to determine what they would do with the welfare system and would consequently have to pay for that, but the important principle is that the UK welfare state would remain integral and the Scottish Parliament, as an autonomous and powerful Parliament, would be able to make its own decisions to reflect the interests of the Scottish people.

The exact amount of money that is spent and who spends it are not the key concerns of the Bill, which is about ensuring that powers are exercised where they most benefit the people of Scotland. The Labour party was the architect of the welfare state—the system of social insurance that covers every citizen, regardless of income, from the cradle to the grave and that is perhaps one of our greatest achievements and the purest expression of our common values and shared purpose. As the architect of the modern welfare state, the Labour party will do everything it can to ensure that it serves the needs of people not just across the UK but, crucially in terms of this Bill, in Scotland. That is why we have sought to be the driving force in this section of the Bill, tabling a total of 21 amendments and new clauses, more than any other party, to ensure that the Smith agreement is not only delivered consistently in spirit and in substance but that the Bill goes much further in welfare provisions.

Each and every one of the amendments has a purpose: to improve the lives of families in Scotland while maintaining the fundamental principles of the underpinning of the UK welfare state. May I take the opportunity to thank all the charities and voluntary sector organisations from across Scotland who have assisted me in this task? They do valuable work day to day with those who are most in need, and we should thank them every single day for what they achieve. Without them, society would not operate in Scotland and across the UK. To put it simply, we should all thank them.

I am glad that the SNP has seen fit to support a number of the amendments. We will work closely together to ensure that we can deliver them. In the same spirit of inter-party co-operation and consensus, I have signed a number of the SNP’s amendments that attempt to improve the Bill. Although this is a fairly technical exercise and welfare is hugely complicated, I want to make it clear that fundamentally our amendments will

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ensure, as I said in response to my hon. Friend the Member for Denton and Reddish (Andrew Gwynne), that the Scottish Parliament has the unrestricted power to create any new benefits in areas that are devolved, in addition to the guarantees of the UK benefits and pension system, as well as the power to top up any benefits that remain reserved in this Parliament. That wide-ranging provision effectively gives the Scottish Parliament the power to design its own welfare system in its entirety. However, unlike others, we are determined to ensure that the welfare state remains an integrated and UK-wide system of social security to allow for the continued pooling and sharing of risks and of resources.

We will also actively pursue our policy of double devolution by devolving as many powers as possible to local communities so that they can be tailored to local needs and circumstance, starting with the Work programme, Work Choice and Access to Work, which we will debate later. Subsidiarity should be at the heart of the Scottish Parliament to ensure that the public are engaged and that there is full community spirit in designing the system that is best for community needs.

Before I speak about Labour’s specific amendments, I want to place on record my disappointment at the comments made by the hon. Member for Dundee East (Stewart Hosie) during yesterday’s debate. He described the proposals in the Smith agreement as “miserable”, and I think that that is quite wrong in the context of this Bill. We should be using this opportunity to improve on the provisions in front of us and to make the system better in Scotland. The Secretary of State has consistently said that he will consider sensible amendments to improve the Bill, both in substance and in spirit, and I hope that he will see many of our amendments on welfare as worth while, tabled in the spirit of co-operation and trying to make the Bill better rather than trying to make political points.

Clauses 19 to 23 concern the devolution to the Scottish Parliament of a number of welfare benefits, including power over disability benefits, industrial injuries allowance and carer’s allowance, the power to introduce top-up payments for people receiving reserve benefits, control over discretionary housing payments and the power to introduce new discretionary payments to help alleviate short-term need. The powers in the clauses are extensive, but there are a number of areas in which I believe they fall short, particularly as regards limiting the scope of the Scottish Parliament to make discretionary payments and create new benefits.

Paragraph 51 of the Smith commission’s report states that the Scottish Parliament

“will have complete autonomy in determining the structure and value of the”


“benefits…or any new benefits or services which might replace them.”

As I have said, we are committed, wherever possible, to abide by the spirit as well as the letter of the Smith commission’s recommendations. We believe that the term “discretionary”, as applied in this context, should not necessarily refer to the strict definition of the recipient of a payment or the duration or frequency with which they receive that payment. As Professor Paul Spicker stated in evidence to the Scottish Parliament’s Devolution (Further Powers) Committee:

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“A payment is discretionary, not because it is short term or individual, but because it is in the power of the delegated authority to determine whether or not the payment will be made.”

However, the Bill as it stands adheres to a more restrictive interpretation of what constitutes a discretionary payment and includes a number of definitions of who can receive benefits and for how long and how often they can receive them, which would limit the autonomy of the Scottish Parliament in a way that, in my opinion, Smith did not intend.

Our amendments seek to ensure that the Scottish Parliament will not face unnecessary restrictions in its provision of discretionary payments to carers, those with disabilities or any other applicant, both in terms of who they are paid to and for how long and how often they are paid.

Kate Green (Stretford and Urmston) (Lab): Does my hon. Friend agree that as well as being an unnecessary restriction in the legislation, the definition is also likely to give rise to a dispute about the ambit of the Bill? A wider definition that would embrace more people would be much simpler to administer.

Ian Murray: I agree, and we should be removing as much ambiguity as possible from the Bill. If the Scottish Parliament wanted to introduce a new benefit or a top-up benefit in one of these categories, the definition should be as wide as possible to enable it to do so. We do not want to end up with a dispute between two Governments or between recipients and the deliverer of the benefits or services about the definition in the Act. It would be good to get some clarity about what is meant by clauses 19 to 23.

As an example, I will consider disability benefit. As Inclusion Scotland has argued, the definition of disability benefits in clause 19 might “restrict the autonomy” of the Scottish Parliament in constructing a new disability benefits

“system based on empowering disabled people to lead active and productive lives and promoting the human rights of disabled people and independent living.”

We have therefore tabled amendment 128, which offers an alternative, broader and more flexible definition of disability benefit that would, among other things, allow the Scottish Parliament to introduce a benefit to assist people with low-level disabilities or those for whom the effect of their disability is largely financial.

Likewise, the definition of what constitutes a “relevant carer” is also, we believe, too prescriptive. As Enable Scotland observes, it

“prescribes to whom carers benefits would be payable, stipulating that the recipient would be over 16, not in full time education and not gainfully employed; and requiring that the cared-for person is in receipt of disability benefit.”

The Scottish Parliament’s Devolution (Further Powers) Committee’s report of May 2015 on the Smith commission proposals and the UK Government’s response concluded:

“The Committee is concerned that the current definition of carer in the draft clauses appears overly restrictive and could limit the policy discretion of future Scottish administrations in this area. The Committee recommends that the clause should be re-drafted to ensure that the future Scottish administrations are able to define what constitutes a carer.”

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I agree with both Enable Scotland and the Scottish Parliament Committee that the clauses as drafted unnecessarily limit the scope of the Scottish Parliament’s powers and might limit their ability in future to create new benefits. We have therefore tabled amendment 48, which seeks to remove the definition from the Bill to allow the Scottish Parliament to arrive at its own definition. I am pleased that the SNP has supported the amendment and want to reciprocate by supporting amendment 115, which provides for the provision of non-financial assistance as regards benefits for maternity, funeral and heating expenses, and amendment 121, which inserts the additional qualifying criteria for provision of discretionary payments and assistance for being part of a family facing exceptional financial pressure.

Sir Oliver Heald (North East Hertfordshire) (Con): Does the hon. Gentleman agree that the overall approach being taken in the UK now is of concentrating on tackling poverty by giving people skills, pushing the work obligation and removing barriers to employment, and that it is important that the welfare system should dovetail with that? There are of course provisions in this Bill to that effect. Does he agree that it would be wrong if Scotland were to take a different approach and go back to a dependency culture?

1 pm

Ian Murray: It is not the purpose of our amendments to create some kind of dependency culture. Indeed, in my last sentence as the hon. and learned Gentleman was seeking to intervene I said that we accept the SNP’s amendment 121 that addresses payments and discretionary payments for families facing exceptional pressure, and the amendments on carers and disabled qualifications widen the definitions, so it becomes not just about supporting people with a financial need, but about work assistance and getting people back into work.

The issues around the Work programme, the Work Choice programme and Access to Work schemes are the third part of this Bill. We will come on to them later and examine some of the points, because the Government have tended to forget that this process is not just about forcing people off welfare; it is also about giving them the opportunity to get back into work and supporting them through that process. We want to support more people in that way, particularly disabled people and those who find it particularly difficult to access the labour market, and we should make sure the legislation is flexible enough to do that.

Sir Oliver Heald: One of the key aims of the UK Government is to ensure work always pays better than being on benefits. Does the hon. Gentleman agree that it would be a pity if any of these reforms altered that balance for Scotland?

Ian Murray: I do agree, but I find it a little ironic that the hon. and learned Gentleman says from the Conservative Government Benches that everything should be designed to encourage people into work, when in fact the whole design of the tax credit system was to encourage people into work and the first aim of the Conservative Government seems to be to cut tax credits which would make it less attractive for people to be in work. There is a fine balance to be struck between supporting people into the

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workplace and in the workplace and making sure work always pays. I think all Members would agree with that principle, but cutting tax credits is not the way to make sure work pays, because it will force people into choosing whether they are better-off out of work or in work. We must strive for much higher pay in order to reduce the welfare bill in tax credits, rather than cutting tax credits; that would be coming at it from the wrong angle.

I was talking about amendments 121 and 115. These are straightforward and common-sense amendments that grant greater autonomy to the Scottish Parliament in the way it provides support to the vulnerable and those at risk in Scotland. We have tabled a number of other amendments to this section of the Bill, including amendment 112 to clause 19 which removes the phrase “short-term” in regard to disability benefits, and amendment 111, which removes the reference to “occasional” financial assistance in clause 23.

Meanwhile, our amendments 12 and 13 to clauses 21 and clause 22 respectively would allow the provision of discretionary financial assistance in a reserved benefit. I do not believe any of these amendments are particularly controversial. Indeed they have garnered a broad cross-section of support from charities, including Enable Scotland, Inclusion Scotland, Learning Disability Alliance Scotland and the Scottish Council for Voluntary Organisations.

Andrew Gwynne: These amendments might not be controversial but does my hon. Friend agree that they send the important signal that a strong devolved Scottish Parliament should be able to determine the benefits for the Scottish people?

Ian Murray: That is right, because the commitment that was given to the Scottish people after the no vote at the referendum last September was that we would create one of the strongest devolved Parliaments in the world. In order to be able to do that, we have to give the necessary tools to the Scottish Parliament to determine not only its own direction in welfare and a host of other policy areas, but the finances it raises to pay for that. Accountability comes with that kind of financial responsibility and that is what, according to Smith, the Scottish Parliament was missing before the Scotland Act 2012 and the Scotland Bill before us today.

The Scottish Parliament needs to be given the ability to make its own decisions. Using terms such as “short-term”, “discretionary” and “on a short-term basis” do not give that flexibility. If someone were putting forward a new system of welfare in Scotland, it would be up to the electorate to decide whether they wanted that and wanted to pay for it.

I now come to arguably the most important amendment to this part of the Bill, new clause 31, which broadens the circumstances under which the Scottish Parliament can create new benefits, and brings it more into line with what I believe the Smith agreement intended. It has been co-signed by SNP Members and for that I am very grateful. Due to its significance we should be able to use it to transform this part of the Bill.

New clause 31 creates a new exception 9 in section F1 in part 2 of schedule 5 to the Scotland Act 1998—I know all Members will have read that and will know exactly what I am referring to—which allows for the creation of any benefit not currently in existence, payable

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by or on behalf of a UK Minister of the Crown, or otherwise a reserved benefit. In essence, this would allow the Scottish Parliament to create any new benefit which is not in existence on the date on which this Act is passed. This, I believe, goes significantly further than what is currently in the Bill.

I will be grateful if the Minister responds specifically on why this, in his view, would not be desirable or practicable, because it ensures that the power to create new benefits in Scotland rests with the Scottish Parliament and therefore the Scottish people, and that it has the flexibility and autonomy to exercise this power free from unnecessary restraint, in keeping with the spirit and substance of the Smith agreement. Of course, there will have to be joint working between the Governments to ensure that it is deliverable, and that brings me to an important common theme that has run through these Committee debates so far: the need for both Governments to work much closer together in partnership for the benefit of Scotland. We cannot emphasise that enough. We must have a much more solid partnership working and relationship to make these provisions work.

Let me be absolutely clear on this point so that there is no ambiguity: I believe in the fundamental principle that the final say on the creation of new benefits, the type of benefit created, whom it is paid to, and how long and how often it is paid, should reside with the Scottish Parliament. That is my view, and that is the view of the Labour party across the UK.

Jim Fitzpatrick (Poplar and Limehouse) (Lab): On the exchange my hon. Friend had with the hon. and learned Member for North East Hertfordshire (Sir Oliver Heald) on the impact of the Government policy of cutting tax credits, which will hit people who are in work more than people who are simply on benefits, will these amendments, many of which have the support of the SNP, give any extra protection to the people in Scotland against the impact of cutting tax credits that will happen in England, or not?

Ian Murray: New clause 31 allows the Scottish Parliament to top up any reserved benefit in the UK and create any benefit in devolved areas, so there would be an ability to create a system that mitigates the reduction in tax credits. As I understand it, tax credits are not a benefit in terms of the system; they are done through the income tax system, so topping up tax credits would be outwith the scope of this arrangement, but there is no reason why under new clause 31 an additional benefit could not be put in place for people who are in work and have children, for example.

I am very pleased that we have managed to get cross-party support for new clause 31 and if the Government agree it, it would give the Scottish Parliament full autonomy on the welfare state, which I think is what the Scottish people and Scottish Parliament want. If the Government are going to support any amendment, I urge them to make it new clause 31, although I also recommend our other amendments.

Mr Graham Allen (Nottingham North) (Lab): This is an interesting debate and a wide range of points have been made on welfare and benefits in general. I will try to stick to the two detailed amendments I have tabled, but I cannot resist making the general point that I see this as Scotland pioneering many of the things that

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should be commonplace throughout the Union. I hope that, if we are successful in proposing some of these amendments and progressive ideas, they will be available to everybody else in the Union.

This is the federal Parliament; this is the Parliament of all the four nations. The success of one nation within that Union should lead to the success of all. Those who wish to do this in Wales, Northern Ireland or parts of England should have that opportunity.

I hope we can tie this to the local government and devolution Bill currently in the other place. Its proposals will enable large parts of England—many of the constituent parts are actually larger than Scotland by combined authorities—through effective devolution from the massive, over-centralised state in Whitehall, or through regionally banding together to create their own units, to deploy some of the things that many found commonplace before 2010. I well remember the work programme put forward by my local city council. It was immensely successful but was then abolished by the incoming Government in 2010. I hope very much that places around the Union will be able to use these useful precedents of freedom and liberation at the lowest possible level—in this case at a national or even a sub-national level—to ensure the good welfare of people in their areas.

I have tabled amendments 129 and 132. Exception 6 in clause 22 requires those receiving discretionary housing payments to be also receiving housing benefit at the same time. Amendment 129 removes that prior requirement; it removes that restriction so that those people can receive discretionary housing payments without having first to claim housing benefit. What that does is quite simple: it allows people in the relevant place to make a judgment on this, rather than some “superbrain” in Whitehall. In this case, the Scottish Parliament would have the chance to work out its own manifesto commitments—Labour party manifesto commitments and Scottish National party manifesto commitments to scrap the bedroom tax. [Interruption.] Forgive me, but I think the important part of that sentence was “scrap the bedroom tax”, which we can probably agree on; I hope the SNP will agree with that.

I will not make this consensus fragile by referring to all those SNP Members who voted with the Conservatives last night. That would be to do something that has been pointed in my direction in the past, so I do not want to raise that sensitive issue. We are dealing with an issue—the bedroom tax—where people of good will throughout the Committee can rattle off examples in their own constituencies about how it has been an appalling thing visited on many of our constituents, with most of them being the most vulnerable and least able to look after themselves, and where some with chronic disability have been targeted. The phraseology we always hear—we heard it a little earlier—relates to the idea that people on benefits are scroungers. Never do we hear about the fact that most people on benefits are pensioners who have worked most of their lives to get their pension or are people who have suffered from the chronic nature of their disability and need help—in any civilised society, we would all expect to help each other. Anything, even the limited change I am proposing to mitigate the worst effects of the bedroom tax, will, I hope, be welcomed by all those parties.

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Sir Oliver Heald: Will the hon. Gentleman give way?

Mr Allen: I will, although I must say, through the Chair, that if the hon. and learned Gentleman wants a debate on the broader concept of welfare, I will try to answer his questions but I may well be called to order.

Sir Oliver Heald: Does the hon. Gentleman agree that his amendment 132, like the SNP’s amendment 117, undermines the sanctions regime, which is there to ensure that taxpayers’ money paying for good advice to jobseekers is properly spent and that people turn up for their appointments? The sanctions regime is there for a purpose but he is undermining it—why?

Mr Allen: The hon. and learned Gentleman may be holding his amendment paper upside down, because it does not say that at all. I will now go on to explain this to him—I always help people, whether they have literacy problems or they are members of the Conservative party, to understand what my amendments mean. I think I know what my amendment means. Amendment 132 states that, if someone suffers financial hardship from having a benefit reduced or suspended, they can receive the discretionary housing payment again—that is in exception 6 in clause 22, and I say that just for the hon. and learned Gentleman. This potentially excludes people who have been sanctioned or had their benefits suspended due to perceived non-compliance with conditions attached to a reserved benefit and to accessing discretionary housing payments.

Sir Oliver Heald: On a point of order, Ms Engel. The hon. Gentleman described me as illiterate, but he is in fact describing an undermining of the sanctions regime, which is what I put to him. Is that in order?

The Second Deputy Chairman of Ways and Means (Natascha Engel): That is a point of debate, and we are slightly veering away from the amendment that the hon. Member for Nottingham North (Mr Allen) has tabled. I think we can move on now.

Mr Allen: I wish that it were a point of debate, but it is a point of accuracy and I am sorry that the hon. and learned Gentleman cannot accept when he has been inaccurate. I hope he will forgive me for keeping pointing that out to him.

1.15 pm

Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP): On whether or not people should suffer a further sanction, I want to ask the hon. Gentleman about circumstances encountered by one of my constituents. He was sanctioned for not turning up to an appointment with the Department for Work and Pensions, but his letter had been sent to the wrong street, albeit the same number, and he was not aware of the appointment. Does the hon. Gentleman agree that it is wrong to further impose a sanction after that?

Mr Allen: The whole sanction regime needs a proper and thorough review, and it should be based on evidence of the sort the hon. Gentleman brings, as I can, rather than on prejudice and electoral gain. Although it may, sadly, go down well in certain leafy suburbs, those of us

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who have relatives who are pensioners or people with a disability, and those of us who represent people who are suffering because of the bedroom tax, have a slightly different perspective. I am trying to share it with some Government Members, but, sadly, this is with a mixed degree of success.

On amendment 132, exception 6 uses the example of non-compliance, but if someone’s claim had been wrongly suspended—the point the hon. Gentleman makes and I fully support—they would be put in a worse position as they would also lose discretionary housing payments. If the rhetoric about trying to get people back into work and about making work pay is meant, making people suffer a double disbenefit flies in the face of trying to help individuals back into work. It is a catch-all and a broad brush, and it is insensitive.

One of the best ways to tackle those problems, which we all encounter in government, is to make government as close to people as is humanly possible. My suggestion in this case is that that should be within the province of the Scottish Parliament, but in other cases we may even be talking about a lower tier of government. I wish briefly to deal with the question of double devolution, which was raised from the Front Bench by my hon. Friend the Member for Edinburgh South (Ian Murray), but just to finish on amendment 132 let me say that it would remove the provisions and the possibility I have described altogether. In summary, it would give the Scottish Parliament the ability to pay the discretionary benefit when a person cannot be paid a reserved benefit such as housing benefit. That is relatively straightforward and I hope I have put it as succinctly as possible.

Ian Murray: My hon. Friend is making an incredibly important speech, and I just wanted to clarify something for him. The reason we have not signed his amendment is that we had an amendment to devolve the entirety of housing benefit, which would of course take into account all those discretionary housing benefit levels. That is why we have not supported his amendment; it is purely because we have the overarching devolution amendment.

Mr Allen: I totally understood that and I see why my hon. Friend has done what he has done. I hope we will get a broader consensus in the Committee as a result.

I wish to make one final point on this couple of detailed amendments, and it relates to double devolution. Again, I am not trying to tread on any sensitivities. I am an irregular visitor to Scotland, but when I go there, as I did over the weekend, I often hear people talk about local government in Scotland being centralised, not, for once, to Whitehall, but to Holyrood. I hope that my good friends in the Scottish National party will be clear when they speak in this debate that they reject a recentralisation of power from Whitehall to Holyrood. Such a recentralisation would fly in the face of proper devolution.

I know that the SNP’s long-term agenda is not devolution but separation of Scotland from the rest of the Union. Separation is the long-term goal of SNP Members. That time may never come, or it may come in some number of years. I do not know; none of us can predict. In the interim, I ask parties of all descriptions in Scotland to put themselves at the service of the Scottish people so that they can get the fullest possible benefit from the devolution proposals. Devolution should not

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merely transfer the ability to tell people what to do from Whitehall—which I resent—to a Scottish Parliament that has accumulated power. Once power has been fought for, granted from the centre and taken down to the lowest level possible, all of us who believe in devolution must avoid the temptation to look at people on the ground and say, “I wonder what we could have from them? I wonder how we can tell them what to do?”

There are some wonderful precedents in Scotland for the other nations of the Union. I hope that all my friends of different political complexions in Scotland will fight as strongly as they fought for their own Parliament to push as much power down to the local level as is humanly possible. I think that we all agree about the need to be sensitive and help people, but it must be done by people as intimately connected with them as possible. That will be another step of progress.

Ms Tasmina Ahmed-Sheikh (Ochil and South Perthshire) (SNP): The Scottish National party has always spoken of powers for a purpose. The reason we are having this debate is that we were promised, as were the people of Scotland, in the run-up to the referendum that we would have a new federalism that was as near to home rule as possible. I hope that the hon. Gentleman accepts that that is the position of the SNP and what the people of Scotland can expect. We want to grow our economy and bring some fairness to society right now, but the hon. Gentleman took to the Lobby with the Government to support further austerity for Scotland.

Mr Allen: Unlike the hon. Lady, I never mistake the interests of the Scottish people for the interests of the Scottish National party. Those of us who believe in devolution can unite with those who believe in the separation and break-up of the Union because we will all be better off if we put the interests of the Scottish people first and learn the lessons that they can teach the rest of the nations of the Union.

Dr Eilidh Whiteford (Banff and Buchan) (SNP): I shall speak to amendments 115, 116, 117 and 131, tabled in my names and the names of my colleagues, and in support of amendments that have been jointly tabled by Labour and SNP Members, including amendment 48 and new clause 31. All the amendments would strengthen the provisions in relation to the benefits system and bring it more closely in line with the Smith commission recommendations. We should remember that those recommendations were agreed by all five main political parties in Scotland and reflect the democratic demand of our people for the power to make decisions in Scotland for Scotland.

The amendments would improve our social security system by ensuring that it is tailored to our needs and circumstances and fits our policy objectives. That in turn will enhance governance and strengthen democratic accountability in Scotland and make a real difference to the lives our citizens.

It is worth restating that paragraph 49 of the Smith agreement recommended that powers should be devolved on benefits for carers, disabled people and those who are sick—attendance allowance, carer’s allowance, disability living allowance, personal independence payments, industrial injuries disablement allowance and severe disablement allowance. The agreement also recommended

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devolution of the benefits that currently comprise the regulated social fund—cold weather payments, funeral payments, Sure Start maternity grants and winter fuel payments, as well as discretionary housing payments. It proposed that new arrangements for the Motability scheme in Scotland for DLA and PIP claimants should be agreed.

Sir Oliver Heald: I welcome what the hon. Lady is saying. Looking at amendment 117, is the SNP really turning its face against conditionality and the focus on work in the benefits system in favour of a system in which, even if someone does not turn up to see the adviser and is sanctioned, they still get the benefit? How can that be right?

Dr Whiteford: On the very last day of the last Parliament, if the hon. Gentleman remembers, the Work and Pensions Committee—with a majority of coalition Members—called for a root-and-branch review of the sanctions regime. The reason why it did that should be self-evident to every Member of the House. We have seen repeatedly how the most vulnerable people in our communities fall foul of that sanctions regime. People with mental health problems and single parents are being disproportionately sanctioned. Members of Parliament can turn up five minutes late to meetings all over this place and do not lose their pay, so why should the most vulnerable and the disabled be subject to sanctions? I agree with the Work and Pensions Committee, which twice in the last Parliament called for a root-and-branch review. We could do so much better in Scotland.

Sir Oliver Heald: Will the hon. Lady give way?

Dr Whiteford: I will not give way again because I want to make some progress.

Paragraph 51 of the Smith agreement was quite explicit that the Scottish Parliament should have

“complete autonomy in determining the structure and value of the benefits at paragraph 49 or any new benefits or services which might replace them. For these benefits, it would be for the Scottish Parliament whether to agree a delivery partnership with DWP or to set up separate Scottish arrangements.”

I come back to the point about amendment 117. It should be for the Scottish Government to tailor policies that suit our purposes and take cognisance of the circumstances in which we live and work.

Smith was also clear that there should be powers to create new benefits and to top up benefits in reserved areas, by making, as it says in paragraph 54,

“discretionary payments in any area of welfare without the need to obtain prior permission from DWP”.

The agreement says explicitly:

“Any new benefits or discretionary payments introduced by the Scottish Parliament must provide additional income for a recipient and not result in an automatic offsetting reduction in their entitlement to other benefits or post-tax earnings if in employment.”

When we compare these sections of the agreement with the Bill, we see all too clearly that it fails to live up to what was proposed. A number of the amendments in this group seek to rectify some of those shortcomings, and I hope that the Secretary of State will take that

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seriously and accept some of the practical measures that would substantially improve and strengthen this Bill.

As it is currently worded, the Bill places restrictions on the ability of present or future Scottish Parliaments to provide appropriate support for sick and disabled claimants and those who provide them with unpaid care at home. We have already heard from the hon. Member for Edinburgh South (Ian Murray) that the definition of disability benefit in the Bill places limits on the types of support that the Scottish Government could introduce, and therefore we support the wider scope that amendment 128 would give to shape policy in Scotland—for example, by enabling those with long-term and temporary conditions to receive support. That is a pragmatic but potentially far-reaching improvement.

In a similar vein, amendment 48 would remove the definition of who can be considered a carer. It is important that the restrictions on carer’s allowance eligibility definitions be removed from the Bill. If the Scottish Government could vary the eligibility conditions, or indeed the amount of a new carer’s benefit in Scotland, we could do more for the 62,000 carers in Scotland currently in receipt of carer’s allowance and potentially, depending on the will of Parliament, look at long-standing issues such as how many hours a person can study while being a carer, or how much of someone’s earnings is counted in determining their eligibility.

Andrew Gwynne: Is not the important issue that for as long as they wish to remain within the United Kingdom, the Scottish people have the guarantee of the United Kingdom benefits system as the baseline, but through the democratic process of the ballot box, if the Scottish people seek to have a more generous and more compassionate welfare system north of the border, they should be able to have that through the Scottish Parliament?

1.30 pm

Dr Whiteford: I entirely agree. The democratic will of the Scottish people over the past few years from the 2011 elections and again more recently—just look around this Chamber—is very clear. They want an alternative to austerity and a fairer social security system.

I am keen to highlight new clause 31, which I hope we will have an opportunity to vote on later. If Labour do not press it to the vote, we will. It gives explicit power to create new benefits in devolved areas, giving effect to that Smith agreement recommendation, and it could be used to improve the support offered to carers. I am pleased that there is a great deal of consensus on the Opposition Benches about the need to move that forward.

Inclusion Scotland, one of the leading networks of disabled people’s organisations in Scotland, has expressed support for amendment 48, and Carers UK and Carers Scotland have said that they welcome