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Lord Elystan-Morgan: My Lords, may I crave the House’s indulgence in asking a question that may be blindingly na├»ve? I speak as one who is less than electronically literate. Is it possible that all or some of

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this information in this highly technological age could have been communicated electronically without the necessity of the physical conveyance over hundreds of miles of those lists?

Lord McKenzie of Luton: My Lords, that is one of the points that the report draws out: downloading data, putting them on a disk and posting it carries risks. Being able to communicate electronically is part of increased data security.

Lord Christopher: My Lords, I declare a past interest: I was general secretary of the Inland Revenue Staff Federation, which sadly is no more. I was there for about 35 years. I apologise to the noble Lord on the Liberal Benches—I cannot recall his name—but I assure him that the old culture of the Revenue has gone and has been effectively destroyed over the past 20 years.

At the heart of the problem that these reports deal with are two matters. The first is in the Poynter report at page 63, and the noble Baroness, Lady Noakes, referred to it. I do not wish to put words in her mouth—if I do, I apologise—but there is no doubt that the present state of the Revenue is largely down to the significant importation of private sector culture. That has come in two ways: in the appointment of the chairman—I do not wish to be unkind to the new chairman, but his CV hardly bears up as a good example of what the report says should be done—and the appointment of board members of Revenue and Customs. The last time that I looked, only one or two of them actually had Revenue experience.

The second matter is mentioned on page 85 at recommendation 43:

As all the recommendations of the report have been accepted, when and how will that be done? If my noble friend cannot answer that, will he keep the House informed of progress on this critical paragraph?

Lord McKenzie of Luton: My Lords, I cannot give my noble friend any great detail on that. Each of the 45 recommendations is listed at the rear of the report, and we have ticked those that we have completed or are addressing and others where progress has been made. I am not sure where the recommendation he referred to sits in that configuration, but I will look at the matter in detail and report back to my noble friend and the House generally. Low morale is an important issue, and the Poynter report identified that as one of the contributory factors, as I said.

Perhaps I may take this opportunity to say something further about laptops, which a noble Lord asked about. One of the Cabinet Office recommendations is that all government laptops are to be encrypted if they handle sensitive personal data. Implementing that is well under way.

Lord Roberts of Conwy: My Lords, the noble Lord said in the Statement that £155 million was to be spent over three years. Could he be more specific on how that money is to be spent?

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Lord McKenzie of Luton: My Lords, I will try. This comes from what the Poynter report describes as a three-stage process for change, based on 10 principles for information security. There are short-term changes to bring greater control through improving existing processes and investigating phasing out data transfer by physical media. In the medium term, there is consolidation through better processes and technology, including moving to e-mail for communications—a point made by a noble Lord earlier—and scanning post and records. The £155 million in the current spending round over three years is addressed largely to that. Kieran Poynter also recommends in the longer term transformation to a new IT-based operating model through a direction of travel that would involve an integrated data system for managing customer information and would place greater responsibility on the customer for maintaining their data. That part of it—the longer-term proposition—will need to be looked at in conjunction with the next comprehensive spending round. The £155 million is for spending over the next three years on the short- and medium-term recommendations made in the report.

I stress that, in the complexities of dealing with data—this issue arose within the department rather than from sharing data across departments—we should not lose the prize of improved public services and customer focus to be had from being able to share information effectively and securely across government. If we take our vision off that, we will not improve public services as we could. Although it is hugely important that we ensure that data security is at the heart of what we do, we should not let that stop us sharing information effectively across government the better to deliver public services.

Lord Gilbert: My Lords, I declare an interest as chairman of a young IT company dealing in digital information assurance.

As one of the few Ministers who had the privilege of simultaneously being responsible for Customs and the Revenue, I echo the sentiments of my noble friend Lord Barnett. I was very unenthusiastic about the merger of those two bodies and am distressed to hear of the collapse of morale that has apparently taken place. When I was responsible for them in 1974-75, I thought that they were two of the finest departments with which I had the privilege to serve and that the officials with whom I worked were of the very highest calibre. It is overlooked that there is a basic conflict of interest between the two departments, particularly when it comes to handling intercompany pricing transactions, especially with respect to imports and exports.

Leaving that on one side, I have two questions for my noble friend. First, do the Government accept that their responsibilities relate not just to the custody of the data that they hold—making sure that it does not leak—but to the integrity of the data while it is in their custody, in other words, that it is not tampered with either maliciously or out of neglect? Secondly, can he assure us that he will come back to this House in no more than six months’ time to give us an update on the report?

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Lord McKenzie of Luton: My Lords, on the second question, I will certainly seek to do that. These matters are not wholly within my remit as a lowly DWP Minister—my noble friend will understand that. Data security is about not just custody but integrity and how the data can be effectively shared. My noble friend is absolutely right.

Although morale is an issue in HMRC—that was identified as key—we should not forget what real progress HMRC has made, the huge amount of talent in that department, the huge scale of its operations and the service that it provides to customers. Let us not forget that in all the challenges that the department faces.

The Earl of Northesk: My Lords, one fact in particular for me stands out from the Statement: the lost disks have yet to be located. None of us can know how much of a time bomb for the economy that may be, but does it not suggest that there is a strong case urgently to pursue the recommendation of the IPPC report? It states:

In other words, is there not now an extremely strong case for the Government to be subject to a breach notification order?

Lord McKenzie of Luton: We have accepted all the IPCC recommendations. It is true that the less than timely reporting of that loss of data may not have helped. I stress that, despite the police investigation and extensive work by HMRC itself, that data has not been located. On the Data Protection Act and the data commission, we are expecting an enforcement notice to be placed on HMRC to require it to use its best endeavours to implement the full range of recommendations from the Poynter report.

Education and Skills Bill

4.24 pm

The Parliamentary Under-Secretary of State, Department for Children, Schools and Families (Lord Adonis): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

Moved accordingly, and, on Question, Motion agreed to.

House in Committee accordingly.

[The DEPUTY CHAIRMAN OF COMMITTEES (Lord Haskel) in the Chair.]

Clause 1 [Persons to whom Part 1 applies]:

Baroness Morris of Bolton moved Amendment No. 1:

(a) has full-time caring responsibilities for a parent, sibling or other relation,(b) is a parent of a child under the age of 5,(c) is engaged in full time voluntary work,(d) has an illness requiring significant medical attention, or(e) has a terminal illness.”

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The noble Baroness said: I shall speak also to Amendments Nos. 2, 8, 19 and 20. Before I get to the substance of our amendments, I restate that we share the Government’s aim of raising the participation age for education or training to 18. It is a positive step and a worthy ambition. Our goal, like that of the Government, is to see more young people improve their life chances by participating as fully as they can, but we are not convinced that compulsion is the right way to achieve this. Throughout the course of the Bill we will ask the Government to think again.

Our first amendment seeks to exclude certain persons from the operation of Part 1. Similar amendments have been tabled by the Liberal Democrats. As I have said, it is no secret that we are concerned about compulsion. The Government have looked at the problem and come up with the right solution, but gone about it the wrong way. The best way to achieve these aims is not to make it compulsory for 16 and 17 year-olds to participate in education and training. That debate will raise strong passions on both sides and we will deal with it fully in the group of amendments tabled on Clause 2. These amendments concern Clause 1, which is a paving clause, and substantially increases government control over 16 and 17 year-olds.

If the Government are determined to press ahead with their plans—I dearly hope that they can be persuaded otherwise—we must deal with the issue in a realistic way. First, we must look at to whom this new law will apply. The Bill will place great demands on young people. It will require commitment, time and dedication from them. We must be wary, when we look at the problem of underachieving young adults and teenagers who have decided to drop out of education as soon as they can, of making the rash assumption that they are all alike. It would be a grave mistake to assume that all the young people who will be caught by this Bill are sitting idle, wasting their lives, ignoring opportunities and simply waiting to be given direction by an all-knowing state. We must recognise that, around the country, there are young people who fall into none of those categories because the circumstances of their lives are different from those which the Government seem to have anticipated.

These amendments are an effort to recognise that there are young people with perfectly valid reasons for not wanting—or, indeed, who are unable—to be in education or training after the current statutory leaving age of 16. We have attempted to draw up several exemptions, so that these perfectly legitimate cases do not find themselves hounded by the authorities for failure to observe the compulsory duty in the Bill. Quite often these are unfortunate, even tragic, circumstances, where it would be appropriate to show some understanding and leniency. Those who are, for example, engaged in the full-time care of a relative, may well yearn for the opportunities which are to be created by this Bill, but it simply may not be feasible to expect them to oblige the Government. A desperately sick parent or sibling cannot be put on hold so that their young carer can rush to the designated course or class, however much he or she may want to.

Similarly, there are parents with very young children. Sadly, some of the young people we are talking about could well have a child nearing the age of five. I would

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be the first to acknowledge that one of the best ways of reducing teenage pregnancy is to raise the ambition of young girls. Sadly, too many children are having children. When this happens, and the young girl in question makes the brave decision to keep and bring up her baby, we should do all we can to help and to ensure that, as far as possible, her education does not suffer. There is also a small child to take into consideration; its early years are precious. During our debates on Bills concerning children we have spent many hours discussing secure attachment and we must not ignore it now. If a young mother chooses to stay at home to look after her young child once she reaches the age of 16, we should welcome it. After all, she could be said to have a pretty much full-time job at home. Of course, once the child has reached school age the picture changes and I hope that such young girls will resume educational training for their general well-being and that of their child.

4.30 pm

However, one area where the objectives of the Bill might be satisfied for young girls with babies is through parenting classes. At a recent meeting of the All-Party Parliamentary Group on Children to discuss the Bill, Lady Tunnicliffe, speaking on behalf of the excellent charity What About The Children?, suggested that this would be a great time to get young girls with babies involved in child development. Can the Minister say whether this would count towards the required training?

For a young person who is seriously ill or who has a terminal illness, what purpose does the Minister think will be achieved by forcing such people into the schemes of the Bill? Why compel them to gain training or skills for a lifetime of work which, sadly, they may never be able to enjoy? What is to be gained by trapping these people into a system of compulsory education and then punishing them when, because of their personal circumstances, they are unable to comply? It may well be that they will choose to continue with education or training, but it should be their choice.

Further amendments in the group, which apply to Clause 2, would ensure that the Secretary of State must make appropriate orders to specify the responsibilities and duties of those caring for relatives or their own children.

I have also included those young people who are engaged in full-time voluntary work. Someone who is so engaged is already displaying a commendable approach to their own development and they should not be overlooked because they are not producing a quantifiable economic benefit. Voluntary work is extremely useful and beneficial and should be encouraged. People engaged in such work will undoubtedly pick up skills along the way, not least self-discipline and motivation.

These are the categories of persons to whom Part 1 of the Bill should not apply if compulsion is to remain. We must legislate in a way which includes not only compassion but also common sense. I beg to move.

Baroness Sharp of Guildford: I support the amendments tabled by the noble Baroness, Lady Morris. I shall speak to Amendments Nos. 3, 5 and 6, which are in my name and that of my noble friend Lady Walmsley.

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As the noble Baroness, Lady Morris, mentioned, these amendments take us straight to the issue of compulsion, which is the central feature of the Bill. The preference on these Benches is that, rather than compulsion, there should be an entitlement to two years’ further education and training. This will be spelt out at some length when my noble friend Lady Walmsley addresses the next group of amendments.

Nevertheless, at this point we should reflect on the extensive debate in the Commons on these issues. It is clear that, although we differ as to how this should be delivered, all parties agree, as the noble Baroness, Lady Morris, said, that it is in the country’s interests that young people aged 17 and 18 should participate in education and training. The question is: what is the best way of securing this? The lengthy debates in the Commons clearly indicated that the Government believe that by 2013—which is the year in which the first element of compulsion comes into force and young people will have to stay in education and training until they are 17—90 per cent of young people will be staying voluntarily in school or working in a job that provides them with the requisite training as a result of the reforms that are currently going through in the 14 to 19 curriculum and through the new initiatives on apprenticeships.

The key element to which this Bill is addressed is the 10 per cent, the NEET group who are not currently in education, employment or training. They are the hard core; many of these young people have dropped out of school long before the age of 16 and live in a shadow-world of odd jobs, drugs and petty crime. Many of them are illiterate or barely literate. They dropped out because they have not been able to keep up. Very frequently this is because they cannot read and write. Because they cannot read they do not understand properly and they find, particularly when they go into secondary school at the age of 11, that it is extremely difficult to cope with the curriculum.

It is generally agreed that one of the reasons why we have such a low participation rate in this country as compared to all other advanced, industrialised countries, is that our secondary school curriculum does not motivate 50 per cent of the pupils. We are well aware of the reforms that the Government are making to that curriculum. We hope that they will be successful and that we shall see this natural increase in participation. But it is questionable whether compulsion is the right way to encourage this hard core of young people, who very frequently have dropped out of school at the age of 14 or 15.

I turn to the group of amendments before us. There is an anomaly. Young people at 16 are now regarded as being old enough to go into the Army, pay taxes, get married, have sex and be parents. They are no longer tied to their parents’ apron strings. My party and, indeed, the Government are very keen that we should give these young people a chance to practise the citizenship lessons that they have been receiving at school and give them the right to vote. Is it right, therefore, that we do not give them a choice over what sort of education they have and when they take that education? Is the sledgehammer approach, as David Laws, our education spokesman in the other place, called it in his deliberations on the Bill, the correct one?

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This set of amendments is exploring two things: first, the anomalies that arise and, secondly, the fourth option. The amendment tabled by the noble Baroness, Lady Morris, picks up on some of these anomalies. It addresses those with full-time caring responsibilities, those who are parents of children under five, those who are engaged in full-time voluntary work—I will come back to that in a moment—and those with an illness requiring significant medical attention or a terminal illness, and so forth.

Amendment No. 3 concerns the issue of sport. Those who take their sport seriously are, by the age of 16, frequently spending more or less all their time in what might be called a sporting apprenticeship. If we are trying to train new champions for Wimbledon or to coach a generation who will bring us some gold medals in the Olympics, these super-athletes are going to have to spend a lot of time in sporting activities. Will they be excluded from the requirements of the Bill?

In Amendment No. 6, we have gone for a parent of a child under the age of one, rather than under the age of five, as the Conservatives have. We endorse the amendments tabled by the Conservatives in relation to both terminal illness and full-time caring arrangements.

Amendment No. 5 is concerned with what might be called the fourth option—voluntary activities. Some extremely interesting sessions were held at the beginning of the Committee stage in the other place when a large number of organisations presented evidence to the Members. Among those organisations were Barnardo’s, the Prince’s Trust and Fairbridge, which deals particularly with the 10 per cent of young people in the NEET group. At Second Reading I quoted some of the recommendations made by these bodies in those Committee sessions.

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