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House of Lords

Tuesday, 5 March 2013.

2.30 pm

Prayers—read by the Lord Bishop of Leicester.

EU: Subsidiarity Scrutiny


2.37 pm

Asked by Lord Kakkar

To ask Her Majesty’s Government what assessment they have made of the working of the European Union subsidiarity test procedure under the Lisbon treaty in view of the two recent reasoned opinions submitted by this House to the European Union institutions.

Lord Wallace of Saltaire: My Lords, the power of national Parliaments to issue a reasoned opinion that an EU proposal does not uphold subsidiarity has been exercised many times since 2010, including five times by your Lordships’ House. Only once, on the Monti II proposals on the right to collective action across borders, have enough Parliaments done so to trigger what is called a yellow card. However, the views of national Parliaments have been influential on a wide range of issues and the continuing use of this procedure should give them an increasing role.

Lord Kakkar: My Lords, I declare my interest as a member of your Lordships’ European Union Committee, Sub-Committee B. Under the current test procedure, this Parliament can only challenge the Commission on the basis of subsidiarity, as the Minister has said, if at least eight other Parliaments also raise concerns. What obligations does the Lisbon treaty place on national Parliaments to participate actively in the scrutiny of directives, because without such scrutiny and participation, the subsidiarity test cannot possibly work? Under what circumstances would the Government consider using the red card in the test procedure, to seek judicial review by the European Court of Justice, where this Parliament, through its scrutiny, has raised substantial concerns about subsidiarity and where other Parliaments may not have participated in the process?

Lord Wallace of Saltaire: My Lords, in the nature of events, red cards are to be used in an emergency situation, not as part of the normal procedure. Perhaps it would help the House if I point out that last year, the Swedish Parliament issued 20 reasoned opinions; the Luxembourg Chamber of Deputies issued seven in 2011 and a larger number in 2012; the French Senate issued seven last year; and the House of Lords issued five. It is not the case that we are the only Parliament to be active in this regard.

Lord Elton: My Lords, under what circumstances would my noble friend consider that Her Majesty's Government should exercise themselves through the

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diplomatic network to engage the interest of other Parliaments in matters that concern us and appear not to have reached their attention?

Lord Wallace of Saltaire: My Lords, Her Majesty's Government do operate a diplomatic network in precisely that area. I hope that scrutiny committees through COSAC—the Conference of Parliamentary Committees for Union Affairs of Parliaments of the European Union—also now operate actively in this regard. I am told that it has become a much more effective body since I used to attend COSAC meetings many years ago when I was the chairman of a sub-committee. There is now a set of offices in Brussels of national Parliaments which provides a network where national scrutiny committees can get together. I hope that the Lisbon treaty arrangements will allow that network to become more and more active.

Lord Pearson of Rannoch: My Lords, remembering that for the past 33 years all British Governments have promised not to allow enactment of proposed EU legislation which is still being scrutinised by our Select Committees here and in the other place, will the Minister confirm Written Answers which reveal that this scrutiny reserve was broken no fewer than 403 times between January 2010 and June 2012? Does that not make 403 pieces of EU legislation that Parliament has not agreed but which have been steamrollered through by the juggernaut anyway?

Lord Wallace of Saltaire: My Lords, the noble Lord uses his characteristically robust and colourful language. There is always a tension between the time that national Parliaments wish to take for scrutiny and the pressures that national Governments, including our own, may wish to give to taking decisions. There are those in national Parliaments who regard the eight-week limit for taking a scrutiny decision as unfortunate, but I am informed by those who know the Brussels situation better than I do that the earlier national Parliaments submit reasoned opinions in the process of negotiation, the greater effect they have.

Reasoned opinions in the form of reports issued by the European Committee of this House are widely respected throughout the European Union in other national Parliaments and elsewhere. I recall with delight a Member of the European Parliament being appointed to head a committee in the European Parliament. He was asked by his clerk to start by reading three documents, two of which were reports from the House of Lords EU Committee.

Lord Hannay of Chiswick: My Lords, would the Minister not agree that in the short period of time that the yellow-card system has existed, the main lesson to draw is that we have to get better at enlisting other national Parliaments when we use the yellow card because that is the shortfall? Will he confirm that on the one occasion when it was used, the Commission withdrew its proposal—the Monti II proposal? Will he also confirm that the right to take action in the Court is one for this House, not the Government under the Lisbon treaty?

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Lord Wallace of Saltaire: I can confirm all of those matters. On the Monti II proposals, some of the reasoned opinions submitted by national Parliaments were much more about the principle of the proposal rather than the subsidiarity issue. Her Majesty's Government did not suggest that we should submit a reasoned opinion on subsidiarity issues because they objected to the principle of the proposal.

Lord Spicer: My Lords, is not one of the ironies of subsidiarity that it requires greater centralisation to determine with whom the subsidiarity should remain?

Lord Wallace of Saltaire: I am not entirely sure that I follow the logic of that. We are in an increasingly globalised economy. That economy requires increasing international regulation of one sort or another. We are in a constant situation of tension between international regulators—not just the European Union but many other international bodies as well—wishing to extend the process of regulation and national Governments, national Parliaments, local groups and other lobbies wishing to resist it.

Lord Wigley: My Lords—

Baroness Falkner of Margravine: My Lords—

The Chancellor of the Duchy of Lancaster (Lord Hill of Oareford): My Lords, we have already had two questions from Cross-Benchers, so it is the turn of the Liberal Democrats.

Noble Lords: Oh!

Baroness Falkner of Margravine: My Lords, does my noble friend agree with the European Union Scrutiny Committee when it took evidence from Professor Dashwood who, in respect of arguing before the European Court of Justice, said that,

“the subsidiarity principle was most useful in the state of law-making rather than at adjudication, at which point it was ‘largely inoperable’”?

In other words, as the noble Lord, Lord Hannay of Chiswick, has said, we need to build alliances in good time rather than wait to go to court.

Lord Wallace of Saltaire: My Lords, the principle of subsidiarity is in many ways a difficult concept to get hold of, and of course it is highly political. There are those here who think that a number of things should be dealt with in Wales and Scotland and not at the national level, while I wish that the principle of subsidiarity was better applied in England than it is at present. This is part of the way we play politics between different levels of government.

Lord Wigley: My Lords, can the Minister clarify how this procedure works in practice, bearing in mind the comments made by the noble Lord with regard to the power being with the Chambers and not with the Government themselves? As the UK has two votes on the basis of being a bicameral system, one of which is allocated to this Chamber, what would be the outcome

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if there was a difference of opinion between the House of Commons and this Chamber? Would we have to defer to the House of Commons as it is the elected Chamber?

Lord Wallace of Saltaire: My Lords, no, we would not. It would be interesting if, for example, the House of Lords decided on one side while the House of Commons decided on the other. I think it is unlikely, but I should say that there have been occasions on which some national Parliaments have issued reasoned opinions objecting to particular proposals while one or two others have issued opinions that are strongly supportive.

Probation Service: Community-sentenced Offenders


2.46 pm

Asked by Lord Ramsbotham

To ask Her Majesty’s Government whether the management of community-sentenced offenders will remain the responsibility of the Probation Service.

The Minister of State, Ministry of Justice (Lord McNally): My Lords, the Transforming Rehabilitation consultation by my department closed on 22 February and we are now considering our response. We have proposed opening up the market for rehabilitation services to a more diverse range of providers, but the public sector will retain ultimate responsibility for public protection and will manage directly those offenders who pose the highest risk of serious harm to the public.

Lord Ramsbotham: My Lords, I thank the Minister for that reply. Last week, the Justice Secretary appeared before the Justice Select Committee in another place and said that we have a duty to supervise offenders in a consistent way and that he wanted to make the probation world more independent of Government and the big bureaucratic documents that tell them how to do their job. For 100 years until recently dissolved by its subordination to prisons, the probation service, in partnership with the police and the courts, was responsible for the consistent supervision of community-sentenced offenders independent of such interference. Can the Minister tell the House how the Justice Secretary’s proposed division of responsibility for the supervision of different types of offender between probation and an unknown number of untried private and voluntary sector organisations will better honour his duty of consistency?

Noble Lords: Hear, hear!

Lord McNally: I hear the growl from the Benches opposite, but it is interesting that we are using the 2007 Act to carry through these reforms of probation, so they are not exactly being original in terms of how we should develop these matters. I do not take fully the point made by the noble Lord about going into the

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unknown. The fact is, as those noble Lords opposite who have had dealings with these matters will know, that the voluntary and the private sectors have been involved in offender management for a very long time. We are trying, within a very tight budget, to see whether we can reform the probation service and dealings with offenders in order to bring in the best of what works outside. It has been interesting to learn that good ideas on offender management are not constrained simply to the probation service. As I said in my original reply, the public sector has ultimate responsibility for public protection, but we think we can deliver a reorganisation that also makes use of the wide variety of experience and expertise that exists in this area.

Baroness Smith of Basildon: My Lords, I have listened carefully to the answers given by the Minister. He will be aware that one of the most important things for the probation service is that there is public confidence in the work that it does. Part of that public confidence comes from the transparency of having information about the work that it does, and understanding what works and what is most effective. In his Answer, he said that the public sector has the ultimate responsibility. Does that mean that all services, even those outsourced to private companies by the Government, will still be subject to freedom of information?

Lord McNally: That is one from left field. I will have to check on that and write to the noble Baroness. However, as she knows, my inclinations are that, as far as possible, freedom of information should extend to all work that is conducted by the private sector, or is covered by the contractual agreement between the public and private sectors, which would allow access to information. I understand the point she makes, and will write and make the letter available to the House.

Baroness Hamwee: My Lords, the probation service is widely admired for its professionalism and general excellence. What ideas do the Government have to make sure that we not only do not lose those but indeed capitalise on them?

Lord McNally: My Lords, at no stage—either at this Dispatch Box, in private meetings or in any other meetings elsewhere—have I ever said anything other than that I am in awe of the work that our probation officers do. It will remain a matter of concern that we get the balance right between our public probation service and the new ideas, initiatives and ways of doing things that we hope this rehabilitation revolution will bring about. I personally hope that one of the outcomes of this rehabilitation revolution will be a probation service that is enhanced in public respect and public confidence. Indeed, I would look to the day when we have a chartered institute for probation, with the same kind of professional status as other professions.

Lord Elystan-Morgan: My Lords, the Minister speaks of a new way of doing things. Is it not the case that when legislation was passing through Parliament, we were told that certain bonuses of a financial nature

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would be paid to those supervising the system, based on success? Will there be an aliquot penalty in the case of failure? In the case of success, what will be the indices of performance in respect of which success will be judged and at what level?

Lord McNally: My Lords, part of the exercise is what is roughly called “payment by results” for those that take on these undertakings if they manage to achieve a rehabilitation, which means people not reoffending within a specific time. Part of the problem we face is that nearly half of offenders leaving prison reoffend within one year. We hope that the system will incentivise those providing services to think creatively about rehabilitation. The worst thing for victims and the taxpayer is this revolving door, which successive Administrations are faced with and which, I believe, the rehabilitation proposals we are bringing in give us a real chance of breaking into.

The Lord Bishop of Leicester: My Lords, given the proposals—

Noble Lords: Next Question!



2.54 pm

Asked by Baroness Quin

To ask Her Majesty’s Government whether they are considering further legislation concerning the holding of referendums in the United Kingdom.

Lord Wallace of Saltaire: My Lords, the Government believe that the legislative framework set out in the Political Parties, Elections and Referendums Act 2000 has worked well. We have no immediate plans to amend this framework. Each referendum held under the Act, however, requires its own separate primary legislation to set the date and question, and to make any other necessary technical changes.

Baroness Quin: My Lords, as many with long memories will know, the first national referendum on Europe in 1975 had quite a lot to do with tackling internal divisions on Europe within the Labour Party. Now it seems that we are to have a referendum on Europe principally for party management reasons as the Prime Minister seeks to appease his party critics. Does the Minister think that this is a satisfactory way of deciding on referendums? If not, will he heed the report of the Constitution Committee of this House, which advised Governments against holding referendums for ad hoc tactical reasons and advised building up a wider political consensus about when and if they should be used?

Lord Wallace of Saltaire: My Lords, I had indeed reread that section of the Constitution Committee’s report, which said, as the noble Baroness has remarked,

“we regret the ad hoc manner in which referendums have been used, often as a tactical device, by the government of the day …

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Where possible, cross-party agreement should be sought as to the circumstances in which it is appropriate for referendums to be used”.

Let us hope that we can reach cross-party agreement on such matters in the future.

Lord Tyler: My Lords, given the precedent of the Scottish independence referendum next year, is it now the Government’s position that any future national referendum with long-term consequences should extend the franchise to 16 and 17 year-olds?

Lord Wallace of Saltaire: My Lords, we have debated this before and I do not want to go too far down this road. The Scots have decided that for this one referendum they would like to extend the vote to 16 and 17 year- olds. No doubt we will discuss time and again how much further that should be extended.

Lord Foulkes of Cumnock: My Lords, has the Minister read the article by our friend, the noble Lord, Lord Hennessy, in the Tablet? In it he reveals that the Cabinet has taken two decisions: first, a wise decision not to have any pre-negotiations with the Scottish Government in advance of the referendum; and secondly, what is in my view an unwise decision not to have any contingency plans to deal with the situation in all our areas of concern if the referendum gives a yes vote. Will he ask his colleagues in the Cabinet to reconsider this? We will all be fighting to ensure that there is a no vote, but in the unlikely but unfortunate event of a yes vote, we have to be ready to deal with the consequences.

Lord Wallace of Saltaire: My Lords, I congratulate the noble Lord on the catholicity of his tastes in reading. I had indeed read that article because the noble Lord, Lord Hennessy, was kind enough to give it to me.

Lord Hamilton of Epsom: My Lords, as it was a Liberal Democrat commitment to have a referendum on Europe, surely there should not be too much difficulty for the coalition partners in agreeing that this is the way forward?

Lord Wallace of Saltaire: My Lords, we will wait to see what is in the manifestos of all the parties for the coming election. The proposal by the Prime Minister in his capacity as Conservative Party leader is to hold a referendum, after some considerable further renegotiation, in the mid-point of the next Parliament.

Lord Tomlinson: Does the noble Lord recall that we spent a long time a couple of years ago debating the extension of referenda to transfers of power to Brussels? Does he agree with my understanding that the fact that we have had no such referendum called indicates that Brussels is not always acquisitive of our powers?

Lord Wallace of Saltaire: My Lords, I vaguely remember some discussions on the subject. The question of whether we are heading towards treaty change is not primarily a matter for Brussels; it is much more a

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matter for different national Governments. The opinions of the French, German and Polish Governments and others weigh very heavily in this.

Lord Taverne: My Lords, will the Minister recommend to his colleagues in the Government the address of Edmund Burke to the electors of Bristol, its comments on the role of Members of Parliament and its relevance to the current addiction to referendums?

Lord Wallace of Saltaire: My Lords, I am surprised that the noble Lord has not also called in aid Mrs Thatcher’s comment in the mid-1970s on the dangers of sliding from parliamentary democracy to plebiscitary democracy. Our political system depends on the principle of parliamentary sovereignty and that is something that we have to cling to.

Lord Pearson of Rannoch: My Lords, further to the supplementary question of the noble Baroness, Lady Quin, does the Minister agree that opinion polls consistently show that more than 80% of the British people want a referendum on our membership of the European Union? Perhaps that should be of some significance even to our present political establishment.

Lord Wallace of Saltaire: I am glad that the noble Lord is such a man of the people in all these respects. I recall that, three months before the 1975 referendum, opinion polls were overwhelmingly in favour of leaving, but that, in the course of the campaign, opinion was informed and thus altered.

Lord Grocott: While we are reflecting on the wisdom of the British people, would the Minister like to reflect on some very successful referendums that have been held in the past two or three years: first, on the good sense of the public in rejecting any notion of a fancy new electoral system for Westminster parliamentary elections; and secondly, on nine out of 10 British cities rejecting fancy directly elected mayors? On the basis of this, might it be a good idea to hold just one more referendum, on deciding whether the elections to the European Parliament next year should be on the basis of first past the post?

Lord Wallace of Saltaire: My Lords, the noble Lord, as always, demonstrates what a splendid conservative he is on all matters of constitutional reform.

EU: Eurozone Financial Transaction Tax


3.01 pm

Asked by Lord Willoughby de Broke

To ask Her Majesty’s Government what assessment they have made of the effect on the United Kingdom financial services industry of the Eurozone financial transaction tax recently proposed by the European Commission.

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Lord Newby: My Lords, on 14 February, the European Commission published a proposal for the implementation of a financial transaction tax through enhanced co-operation. The UK has the largest financial sector in the EU. The Government oppose the European Commission’s initial proposal for an EU-wide financial transaction tax and the UK will not be participating in an FTT introduced through enhanced co-operation by a group of member states. We are currently studying the draft proposal carefully to understand its impacts and will continue to engage fully in discussions going forward.

Lord Willoughby de Broke: My Lords, I am grateful to the Minister for that Answer as far as it goes, but, reading the newspapers and the Commission’s proposals, I believe that the United Kingdom will be affected. Can the Minister confirm that UK tax policy is made in Parliament and not by the European Commission and a gaggle of member states which are jealous of the City’s pre-eminence in financial services? What actions will the Government take to protect our special interests in this matter?

Lord Newby: My Lords, as I said in my original Answer, we are fully engaged in discussions going forward. If the FTT is introduced, it will have a number of impacts on the UK. The Government are in the process of assessing what those impacts might be.

Lord Forsyth of Drumlean: My Lords, can my noble friend tell us how much the European Commission expects the tax to raise? Will it not be pensioners and consumers who have to pay it?

Lord Newby: My Lords, the estimate that the Commission has produced is that the tax would raise €35 billion. It would not be raised from all financial institutions across the EU; it would be raised only from those established in countries which levy the tax. A tax such as this, which covers things like shares, trickles down through multifarious channels but, obviously, at the end of the day, a very large number of people end up paying a small amount towards it.

Lord Barnett: If the treaty eventually proposes a tax that would affect this country, will the Minister make it clear that we would veto it?

Lord Newby: My Lords, the noble Lord needs to understand the difference between a tax which we would levy, where there is a veto, and a tax which we would help collect, of which there are a number of existing examples in EU law and this would be another.

Baroness Wheatcroft: My Lords, does my noble friend agree that a tax which was to some extent a deterrent on frequent trading—for instance, algorithmic trading—might not be such a bad thing if it encouraged long-term investment in shares?

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Lord Newby: My Lords, I am sure that many noble Lords share that aim. The question is whether such a tax would have that impact, and the academic work on it is ambiguous at best.

Lord Eatwell: Will the noble Lord explain why the Government are so allergic to the financial transaction tax, which is to be levied at less than 1% of the value of transactions and by many countries, whereas we are quite happy to have stamp duty levied on transactions at 5%, which is effective only here in the UK?

Lord Newby: My Lords, we have some examples of where this kind of thing has been done in the past. In 1989, Sweden introduced its version of an FTT and in the first week the volume of bond trading fell by 85%, even though the tax rate was only 0.003%. The volume of futures trading fell by 98% and the options trading market disappeared. Not surprisingly, Sweden is not now supporting the idea of a Europe-wide FTT.

Baroness Kramer: My Lords, the original concept of the financial transaction tax was that it would be global and that the funds would be used to assist the developing world. Have the British Government considered that, as many politicians on all sides support those concepts, they might take leadership in this global role, which might strengthen their hand in these much more parochial negotiations with the European Union?

Lord Newby: My Lords, the noble Baroness will recall that in 2011 the French Government proposed such a tax at a global level in G20 and there was widespread opposition to it from, among others, the US, China, Australia and Canada. Sadly, there is nowhere near a global consensus on whether such a tax is a good idea, and, equally, there is no consensus, even within the EU, about where the money should go. The French were, and are, keen that at least part of the proceeds should go to development aid, but the Germans, for example, propose that any receipts from the FTT should simply go into the central tax pot.

Lord Lea of Crondall: Given the behavioural crisis in many of the financial institutions in recent years, would the Government not be well advised to discuss the merits of such taxation around Europe, rather than reacting like Pavlov’s dog to anything just because it comes from Brussels?

Lord Newby: My Lords, we are engaged in discussions on this tax as it could have significant impacts not just on the City but across the EU. While the Government are not opposed in principle to a global FTT, with the lack of consensus on such a thing and faced with a proposal which we think could be damaging not just to the UK but to Europe as a whole, we are rather sceptical about it.

Lord Pearson of Rannoch: How do New York and other financial centres react to the international reach of this particular piece of EU lunacy?

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Lord Newby: My Lords, as far as I am aware, New York has not yet responded to the most recent Commission proposals.

Health and Social Care Act


3.07 pm

The Parliamentary Under-Secretary of State, Department of Health (Earl Howe): My Lords, I shall now repeat as a Statement the answer to an Urgent Question given in another place by my honourable friend the Minister for care services earlier today on the National Health Service (Procurement, Patient Choice and Competition) Regulations 2013. The Statement is as follows:

“I know that the right honourable gentleman and others have raised concerns about the effect of the regulations, and I would like to address these. First, however, I would like to make it absolutely clear that the regulations must be fully in line with the assurances given to this House during the passage of the Health and Social Care Bill.

The former Secretary of State said to clinical commissioning groups in 2012 that,

‘commissioners, and not the secretary of state, and not the regulators, should decide when and how competition should be used to serve patient interests’.

This absolutely must be the case. I made it clear in health Questions last week that we would review the regulations to ensure that this is the case and that they are not open to any misinterpretation.

The right honourable gentleman himself gave guidance to primary care trusts, which made it clear, in 2010—and again I quote:

‘Where there is only one capable provider for a particular bundle of services or the objective of the procurement is to secure services to meet an immediate interim clinical need there will be a case for Single Tender Action (ie uncontested procurement). By definition, an immediate’—

or urgent—

‘scenario will be exceptional and likely to only … arise on clinical safety grounds or, for example, where existing services have been suspended following intervention by the Care Quality Commission’.

The next bit is very important:

‘A decision to procure through a single tender action should always take account of the potential to secure better value by investing in a competitive process, as long as this is justified by the scale and importance of the opportunity (ie it has to be worth it)’.

As we committed in the Government’s response to the Future Forum report, we want to ensure that the regulations simply continue this approach. However, I fully recognise that the wording of the regulations has inadvertently created confusion and generated significant concerns about their effect. I have therefore listened to people’s concerns and my department is acting quickly to improve the drafting so that there can be no doubt that the regulations go no further than the previous set of Principles and Rules, inherited from the previous Labour Government. As we also committed in response to the Future Forum’s report, the Co-operation and Competition Panel has been transferred to Monitor and this will ensure consistency in the application of the rules.

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Concerns have been raised that commissioners would need to tender all services. This is not our intention and we will amend the regulations to remove any doubt that this is the case and to clarify that the position remains the same as at present—and as stated in the former Secretary of State’s letters in 2012. Concerns have been raised that Monitor would use the regulations to force commissioners to competitively tender. However, I recognise that the wording of the regulations has created uncertainty and we will therefore amend them to put this beyond doubt.

Concerns have also been raised that competition would be allowed to trump integration and co-operation. The Future Forum recognised that competition and integration are not mutually exclusive. Competition, as the Government made clear during the passage of the Bill, can only be a means to improving services for patients, not an end in itself. What is important is what is in patients’ best interests. Where this is co-operation and integration there would be nothing in the regulations to prevent this. Integration is a key tool that commissioners are under a duty to use to improve services for patients. We will amend the regulations to make this point absolutely clear”.

My Lords, that concludes the Statement.

3.12 pm

Baroness Wheeler: My Lords, I thank the Minister for reading out the response to the Urgent Question in another place. While we welcome the climbdown on the regulations, can he appreciate the sheer disbelief and consternation across the House at the regulations, coming as they do after the recent SI on local Healthwatch that even the Government’s own supporters described as complex, draconian and muddled? These regulations flew directly in the face of lengthy and repeated government assurances about Healthwatch’s independence and right to campaign. Now we have a repeat of the story with the Section 75 regulations, which again made a mockery of the assurances by both Commons and Lords Ministers during the passage of the Health and Social Care Act. In the words of the Minister, GP commissioning would be,

“under no legal obligation to create new markets, particularly where competition would not be effective in driving high standards and value for patients”.—[

Official Report

, 6/3/12; col.1691.]

As the Francis report made clear, GPs must exploit their new role as commissioners to the full to ensure that their patients get safe and effective care. How will care be safe and effective if the coalition’s competition policy on the NHS is in chaos? Despite all the upheavals inflicted on the NHS, there is still no clarity in policy. The Government’s U-turn is clearly a response to Labour’s fatal Motion. The writing is on the wall for their plans to marketise the NHS. Why did it take this Motion to make the Government think again?

Finally, can the Minister outline to the House the sequence of events going forward? Can he confirm that the Government cannot in fact withdraw the current regulations but must lay additional regulations to annul or amend the mess we are now in? When will the new regulations be laid and when will the House have a chance to consider them?

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3.14 pm

Earl Howe: My Lords, first, I understand perfectly the anxiety that has been voiced about the way the regulations are worded. This is a problem centring in almost every respect on legal drafting. Our intention and our instructions have been as they always have: to create a set of regulations—as expected under the terms of the Act, as the noble Baroness knows—which reflect in every way the assurances given by Ministers during the passage of the Health and Social Care Act, no more and no less.

However, to the lay reader, certain parts of the regulations which, in legal terms, do as they were intended appear not to do so. We took very seriously the fact that perception differed from reality—perceptions matter—and therefore, early last week, I put in train a programme of work to revise the regulations. However, we also determined that we could not come to Parliament with half a story and that we would have to present our fully formed response to the concerns by tabling a set of revised regulations. We were not in a position to do that until this week. It was therefore not the case that the Opposition’s Motion forced us into this position. I was well aware that we had to respond to the concerns voiced not only in this House but in the wider healthcare community.

The noble Baroness said that she thought our competition policy lacked clarity. Our competition policy is based on competition law as it now appears and as it was during the previous Administration. There is no question of our changing that. The idea that we are trying to marketise the NHS is, as the noble Baroness knows, not true. In the Health and Social Care Act, we included a specific provision which prevents the Secretary of State or anyone else preferring independent sector providers over the NHS. That was something which the previous Government did not see fit to do.

The noble Baroness asked me what the programme ahead looked like. We intend to revoke the current regulations and substitute regulations with amended wording within a few days.

3.17 pm

Baroness Jolly: My Lords, I thank my noble friend for meeting Members from these Benches on this issue nearly two weeks ago. Will he confirm for the House that, in line with assurances given during the course of the Bill last year, the regulations will promote integration of services in the best interest of patients?

Earl Howe: I think that everybody was agreed during the passage of the Health and Social Care Bill that we wish to encourage integration in the way that services are commissioned. Integration in this context should be taken as a term that reflects the experience of the patient. The patient has to feel that he or she is on a seamless pathway of care. That care may be provided by a number of agencies, if necessary, whether in the NHS or social care, but the patient’s experience should not be disjointed. Therefore, as my noble friend will remember, numerous provisions were inserted into what is now the Act to ensure that commissioning

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should be on that basis. Nothing in these regulations interferes with that, but it is very much in our minds to make it crystal clear that integration of services is one of the main factors which commissioners should take into account.

Baroness Morgan of Drefelin: My Lords, can the Minister reassure the House that the new draft regulations are consulted on before they are tabled—very swiftly, I am sure—to safeguard against misinterpretation again by lay audiences? Perhaps a very swift consultation programme could be developed with stakeholder organisations, royal colleges, patient groups, and so on, so that we can avoid the misunderstanding to which the noble Earl refers.

Earl Howe: I intend to meet some of the royal colleges, and I have met one already. I do not feel that a full-scale consultation is appropriate because the Government’s policy has not changed. It is the wording of the regulations that has given rise to anxiety. I therefore think that, having taken on board, as I hope I have, all the concerns that have been raised, a clarification of the regulations is all that is necessary and there is no need to consult on the policy yet again.

Lord Harris of Haringey: My Lords, is it not the case that the Government have form on producing regulations that are virtually incomprehensible as far as the lay reader is concerned, particularly in respect of these health service changes? We had the incident with Healthwatch only a few weeks ago. Even though there is a short timescale, is it therefore not imperative that there is proper consultation to make sure that whatever emerges reflects the very fine and helpful words that the Minister has given us this afternoon? Will he also tell us whether Ministers ever read these draft regulations before they are laid before the House?

Earl Howe: My Lords, it is my intention to issue an invitation to noble Lords to join me in a meeting so that we can discuss these matters. I am very happy to do that over the coming days. The answer to the second question is yes. We read these regulations in conjunction with the Explanatory Memorandum and the line-by-line interpretation that we have also published in this case which make it crystal clear that these regulations do no more and no less than reflect the law and the Government’s policy. However, others have chosen to misinterpret the regulations, and that was something that I could not predict.

Lord Warner:The Minister may know that I do not always see totally eye to eye with all my colleagues on these Benches on the subject of competition. Will he say how much discussion there has been with the voluntary sector and social entrepreneurs on these regulations? In my experience they have always struggled to make their presence felt when contracts are available within the NHS.

Earl Howe: My Lords, the department consulted on its proposals for these regulations between August and October last year on the basis of the commitments

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that had previously been given. All sectors had an opportunity to feed in their comments. Our proposals for the regulations did not give rise to any anxieties at that time.

Lord Whitty:My Lords, the Minister should have been made aware of the concern I expressed the other night in relation to the reference to Monitor in the Enterprise and Regulatory Reform Bill and to its supervision by the proposed Competition and Markets Authority which seems to some of us to introduce by the back door a situation where the CMA would override Monitor, making, in effect, competition trump integration and co-operation. Will he now advise the noble Viscount, Lord Younger, to delete the reference to Monitor in that Bill?

Earl Howe: My Lords, I took the opportunity to read the noble Lord’s comments a few days ago, and I am grateful to him for them. He will be receiving a communication in a few days’ time to clarify this issue. I thank him for raising it. The short answer to his question is that it is not our intention for competition to trump integration.

Damages-Based Agreements Regulations 2013

Conditional Fee Agreements Order 2013

Criminal Legal Aid (Determinations by a Court and Choice of Representative) Regulations 2013

Legal Aid (Information about Financial Resources) Regulations 2013

Civil Legal Aid (Costs) Regulations 2013

Motions to Approve

3.23 pm

Moved by Lord McNally

That the draft regulations and orders laid before the House on 14 and 21 January be approved.

Relevant documents: 16th and 17th Reports from the Joint Committee on Statutory Instruments, considered in Grand Committee on 26 February.

Motions agreed.

Local Authorities (Contracting Out of Tax Billing, Collection and Enforcement Functions) (Amendment) (England) Order 2013

Council Tax Reduction Schemes (Detection of Fraud and Enforcement) (England) Regulations 2013

5 Mar 2013 : Column 1384

Gateshead and Northumberland (Boundary Change) Order 2013

East Hertfordshire and Stevenage (Boundary Change) Order 2013

Motions to Approve

3.23 pm

Moved by Baroness Hanham

That the draft orders and regulations laid before the House on 14 and 22 January be approved.

Relevant documents: 16th and 17th Reports from the Joint Committee on Statutory Instruments, considered in Grand Committee on 28 February.

Motions agreed.

Presumption of Death Bill

Third Reading

3.24 pm

Lord Wallace of Saltaire: My Lords, I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Presumption of Death Bill, has consented to place her interests, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.

Bill passed.

Mobile Homes Bill

Third Reading

3.25 pm

Bill passed.

Armed Forces: Army Basing Plan


3.26 pm

The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Astor of Hever): My Lords, with the leave of the House I will now repeat a Statement made in the other place.

“With permission, Mr Speaker, I would like to make a Statement on the future basing of the British Army. To assist honourable and right honourable Members in understanding the detail of the changes I shall announce and the effects on their constituencies, I have placed in the Libraries of both Houses and on the MoD website documents setting them out. Copies are, with your permission Mr Speaker, being distributed in the Chamber.

In 2010, we set out in the strategic defence and security review the configuration of forces that the UK would require to meet future threats and we committed to have completed the return of UK troops from Germany by 2020. Last summer, I announced to the House the structure of the Regular Army component of Future Force 2020. Today, I can announce the

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future pattern of basing of the Regular Army in the UK so that our service men and women, their families and the communities that host Army units have clarity about where they will be based in the future and when moves are likely to occur.

As the House will recall, in July 2011 the then Defence Secretary set out our initial plans for the future of the MoD estate on which we will accommodate, train and prepare our Armed Forces. Those plans have been significantly refined over the intervening 18 months and reflect the fully developed military advice on the optimum affordable basing lay down to accommodate the Army in its future structure.

This announcement honours our commitment to bring all our troops home from Germany by 2020, with all but 4,400 of 20 Brigade home by Christmas 2016. It supports the Army 2020 structure, the integrated reserves training model and the generation of the Army’s future military capability. It delivers a £1.8 billion investment in the UK economy in infrastructure and accommodation and annual savings of £240 million in reduced costs and improved efficiency of training and maintenance operations, on top of the £100 million-plus annual saving generated by the previously announced moves from Germany.

The return of the British Army from Germany marks the end of an era and I want to put on record the huge debt of gratitude we owe to the German Government and the German people for the support, both moral and material, they have shown our Armed Forces over more than six decades. In fact, that return has already begun. In 2010, there were 20,000 British service personnel based in Germany together with their dependants and civilian staff. Already, that figure has been reduced to less than 16,000, with significant force elements having already relocated, such as the Headquarters Allied Rapid Reaction Corps, which has moved to Innsworth, Gloucestershire.

Planning for completion of the return is well advanced. We are on track to reduce our presence in Germany by more than 70% by 2015, against our SDSR target of 50%. The long-term retention of a small training presence in Germany, utilising NATO training facilities, is under consideration, but we will be closing all major unit locations. But this is not just about rebasing the Army from Germany. It is about providing a basing plan for Army 2020 in the UK, which will allow the Army to generate its military capability in the optimal way.

As the plan has developed, two key principles have emerged to inform it. First, the armoured infantry brigades of the reaction force should coalesce around a single location. We have concluded that Salisbury Plain Training Area is the only place in the country where we have the capability to carry out the complex and demanding training exercises they need to conduct. Having all three brigades located in close proximity around the plain will enable them to train and fight more effectively, and will present significant opportunities for efficiency in equipment support and people management. Secondly, the Army should retain a UK-wide footprint, maintaining the vital link to civil society, fostering closer links between reserve units and their partnered regular units and supporting nationwide recruitment and engagement.

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Guided by these two principles, the Army has identified the laydown that represents the best value for money, both in terms of utilisation of existing estate and in terms of minimisation of running costs. The focus will be on increasing consolidation around seven centres at: Salisbury Plain Training Area, where we will invest over £800 million; north-east England, centred on Catterick; Aldershot; Edinburgh and Leuchars; Colchester and Swanton Morley; Stafford and Donnington; and, in the east Midlands, focused on Cottesmore and North Luffenham, where £180 million will be invested—all while maintaining a regional presence in other parts of the country. Consolidating around these seven centres will significantly reduce the need for moves, giving Army personnel and their families greater certainty about where they will live and work, with real benefits in terms of increased stability, access to long-term spousal employment opportunities, continuity in schooling and the chance to set down roots and access the benefits of home ownership.

This announcement will maintain the broad pattern of Army activity in Scotland, Wales and Northern Ireland. With 45 Commando Royal Marines remaining in Arbroath for the foreseeable future, the measures announced today will see an increase of about 600-plus in total regular Armed Forces numbers north of the border as against the July 2011 baseline, even as the Armed Forces reduce in size by about 17% overall. In both Wales and Northern Ireland, overall numbers will reduce by approximately 400.

This announcement sets out our firm plans for the laydown of the British Army, subject of course to gaining the necessary planning, environmental and other regulatory approvals. They are underpinned by a capital investment from the defence budget of £1.8 billion, including £1 billion of investment in new living accommodation to provide 7,800 single living spaces and 1,900 new and refurbished units of family accommodation. This investment will provide a welcome stimulus to the UK construction industry and, taken together with significant purchasing power currently going into the German economy that will be diverted to the UK, will help create jobs across the regions and nations of the UK.

The MoD plays a major role in the Government’s public land release programme and will be looking to release additional land and surplus service family accommodation where it is no longer needed. Under this plan, the Armed Forces will leave a number of locations. The disposal plans will be subject to further detailed work and will be subject to the completion of the plans for the reserve estate in due course. However, I can confirm that we plan to dispose of Howe Barracks in Canterbury, Claro Barracks in Ripon and parts of Copthorne Barracks in Shrewsbury. In Scotland, we will be disposing of Craigiehall Barracks, as well as elements of Redford Barracks and Forthside Barracks, Stirling. Kirknewton will not now be developed as an Army base but Dreghorn will remain as one.

The MoD intends to close Cawdor Barracks at Brawdy in Wales, which is no longer fit for purpose, with 14 Signal Regiment relocating to St Athan, not before 2018, as part of a regional consolidation of the defence presence on that site that will also allow

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commercial development and job creation by the Welsh Assembly Government, with whom we are working collaboratively in support of the enterprise zone. The local communities in each of these areas have been hugely supportive of the military presence over many years. The loss of historic ties will be much regretted and, on behalf of the Army, I want to thank those communities for their generous hosting.

As part of our continued scrutiny of the central London estate, we will be pursuing options to vacate Hyde Park Barracks and reprovide for the Household Cavalry Mounted Regiment elsewhere within central London, allowing for disposal of this prime development site, provided that the regiment’s requirements can be met and that it proves value for money to do so. These disposals, and other planned disposals, will bring substantial receipts which have already been factored into the MoD’s future budgets and will significantly reduce the operating costs of the MoD estate.

I have focused today on the future basing of the Regular Army, but I am conscious that many honourable and right honourable Members will also be interested in the reserves and in our plans for reserve basing, as well as the future basing plans for the other services, the training estate and logistics operations. My right honourable friend the Minister for the Armed Forces will be making announcements shortly concerning other routine changes elsewhere in the MoD estate across the UK, and I will update the House before the Summer Recess on the future basing plans for the reserves.

This announcement represents a costed and funded plan to bring our Army back from Germany, deliver the basing laydown for Army 2020 and provide the accommodation our troops deserve, fulfilling our commitments to consolidate the Army estate and providing certainty to Army personnel and their families about where they will be based in the future. It is a plan that is driven by the Army’s requirement to generate military capability in the most effective and efficient way as it reconfigures for contingent operations based almost entirely in the UK. It represents a significant step towards the achievement of Future Force 2020, delivers substantial savings to defence in the future and a significant boost to the UK economy, and to the construction industry in particular, right now.

I commend this Statement to the House”.

My Lords, that concludes the Statement.

3.38 pm

Lord Rosser: My Lords, I thank the Minister for repeating the Statement made earlier in the other place by the Secretary of State on the next, but hardly controversial, stage of one half of the coalition Government’s withdrawal of troops from Europe. We welcome a steady, costed withdrawal of UK troops from Germany. Today’s announcement will impact on Army deployability, our ability to meet planning assumptions, service families’ livelihoods, and the integration of service personnel with local communities.

Before asking some detailed questions on how to make these measures successful, I will refer to previous Statements on the basing plan. The 2010 Strategic

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Defence and Security Review referred to the redeployment back to the United Kingdom of British Forces personnel currently based in Germany. It also referred to reconfiguring the Army into five multirole brigades. Approximately half of the then 20,000 personnel serving in Germany were expected to be relocated back to the United Kingdom by 2015, and the remainder by 2020.

Following the SDSR, the Ministry of Defence undertook a basing review, the conclusions of which were announced by the Secretary of State in July 2011. Under the plans announced then, RAF Kinloss would be transferred to the Army, with some of the personnel returning from Germany being based at Kinloss from 2014-15. RAF Leuchars was also to be transferred to the Army, with two major units and a formation HQ being redeployed to that site from Germany. The HQ was expected to move to Leuchars before 2015, followed by the two units between 2015 and 2017. RAF Cottesmore was to be vacated by the RAF, with the Army expected to start moving in in 2013.

The five multirole brigades envisaged under the strategic defence and security review were to be located in and around Catterick and Salisbury, in eastern England largely at the former RAF base at Cottesmore, and in Scotland, largely in Kirknewton, south-west of Edinburgh. The multirole brigades in eastern England and Scotland were to be largely formed from units returning from Germany. According to the July 2011 Statement, it was expected that approximately 6,500 to 7,000 Army personnel currently in Germany would be based in Scotland. It was also expected that units returning from Germany would move into bases in Aldergrove in 2015, and that further units returning from Germany would relocate to Pirbright barracks during the course of this year.

In November 2011, the Ministry of Defence announced the first tranche of moves that would take place in 2012 and the first half of 2013 as part of the defence rebasing programme, with the first tranche including 1,800 personnel returning from Germany. I mention all that because I want the Minister to clarify the extent to which the proposed moves and timescales announced today are in line with previous announcements and Statements on the basing review and on the redeployment back to the United Kingdom of British forces personnel currently based in Germany. Where there have been any changes, will he explain what those changes are, including changes in timing, and the reasons for them, as that is not entirely clear from the Statement made in the other place by the Secretary of State for Defence?

The Secretary of State in the other place also said, and, indeed, repeated in the Statement, that the total cost of returning troops from Germany is £1.8 billion. Will the Minister spell out specifically where this money has been found and say whether any cuts to the Ministry of Defence non-equipment budget are being made as a result of having to find this money? All those in the military who have recently lost their jobs will want to know that today’s announcement has not been funded at their expense. Likewise, will the Minister say how much is allocated for each RAF base being converted to make them fit for the Army, and in each case when the conversion will be completed?

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I would like to refer to the Armed Forces Covenant Annual Report 2012 because it contained the following observations by external members of the covenant reference group. It stated:

“Notwithstanding the fact that work on the New Employment Model (which will include accommodation) is on-going, we urge the Government to produce a transparent assessment of the impact of the freeze both on the condition of accommodation and on how the needs of Armed Forces personnel and their families are being met, particularly given the imminent relocation of our Forces from Germany”.

It is also worth reminding ourselves of the comments by the Armed Forces Pay Review Body in its 2012 report. It stated:

“Against the background of wider changes and uncertainty, accommodation remains high on the list of concerns for Service personnel and their families. We hear repeated concerns during our visits and from the Service Families’ Federations, ranging from practical issues about the lack of choice in allocations and variable maintenance performance in different locations to policy issues on the definition of the family. … On our visits Service personnel and their families often commented on the allocations process for Service Family Accommodation (SFA). Lack of information and choice ahead of moving to a new unit were often mentioned as issues of concern”.

The pay review body went on to express concern at receiving,

“poorly evidenced proposals from MOD to address its perception that the ‘subsidy’ to Service families has become too high”.

The pay review body went on to comment:

“The evidence we received from MOD was driven by the perceived need to reduce the difference between MOD’s spending on Service accommodation and its rental receipts. It did not give sufficient consideration to the human aspect of housing or the role of accommodation in the overall package for personnel”.

In the light of those comments from the pay review body and the Armed Forces Covenant Annual Report, including observations by the external members of the Covenant Reference Group, in relation to accommodation, rents and the apparent gap between income and expenditure, can the Minister say whether Armed Forces personnel and their families returning from Germany will be faced with attempts by the Ministry of Defence to secure significant increases in rents for accommodation provided for them in this country? What steps are being taken to address the other concerns on accommodation, to which I have referred and have been highlighted by the pay review body, in the light of the moves back from Germany? Clearly, accommodation is a significant issue for Armed Forces personnel. The quotes that I have mentioned are not mine but are contained in the Armed Forces Covenant Annual Report 2012 and the pay review body report for 2012. It would be helpful to have the Government’s response, bearing in mind that a significant part of the success of the moves back from Germany will be dependent on the quality, extent, variety and cost of accommodation provided for our Armed Forces personnel who are moving back.

What efforts will the Ministry of Defence be making to give personnel returning from Germany the opportunity to purchase their own homes, which I know is an objective of the MoD? It would be helpful if the Minister could say a little more on that score. Can we also be assured that the accommodation provided in the UK will be of comparable size to the accommodation in Germany? I know that this might sound like a detail but, to the families, that would not be the case if it

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went wrong. If the accommodation is not of comparable size, there could be logistical issues such as existing furniture not being able to fit into the new accommodation. I am sure that some warm words—I hope more than warm words—of clarification on that point would be extremely helpful.

Most of my comments are directed towards the moves back from Germany. Can the Minister give a guarantee that no one returning will be forced to take expensive private rented accommodation? What are the anticipated costs of education and healthcare provision for Armed Forces personnel and their families returning to this country, bearing in mind that they are likely to be concentrated, as I understand from the Statement, in a relatively small number of locations? Will the cost of education and healthcare fall on the defence budget or education and health departmental budgets, and those of the devolved Administrations? I ask that particularly in relation to the reductions in the amount of money that local authorities have. Bearing in mind that those returning are moving back to a relatively small number of locations, what will be the impact on existing schools? If new schools are required, will they be local authority schools, academies or free schools, and who will make such decisions?

Will the decisions on where to base personnel—the biggest group that we are talking about is coming back from Germany—lead to an even greater concentration of our Armed Forces in a limited number of locations, largely in the south of England? Given that that appears to be the case, subject to what the Minister says in reply, will that have any adverse impact on recruitment into our Armed Forces from other parts of the country, particularly when the economy picks up and those seeking employment have a wider choice of job opportunities?

Will it also be the case that, with the withdrawal of our Armed Forces from Germany, the expenditure on the costs of such a move will have to be financed well in advance of any savings or other financial benefits being realised? The noble Lord referred to costs and he also referred to savings, but he did not refer to timescales. If it is the case that the costs have to be borne well before the savings are achieved, what would be the cash-flow implications for the Ministry of Defence budget? May I also ask that, in withdrawing from Germany—

Noble Lords: Too long.

Lord Rosser: Are we faced with any penalty or other payments as a result or are we able to withdraw from the accommodation sites we currently occupy in Germany at any time we choose without incurring any penalty or other charges?

I am sure from the comments that have just been made that your Lordships will appreciate the fact that I am about to conclude. UK troops have been stationed in Germany for almost 70 years. We support their return home, but this will be matched, on our part, by detailed scrutiny. I hope the Minister will be able further to outline the implications of today’s announcement for personnel and their families as well as for local communities which, I am sure, will give our returning troops a warm and patriotic welcome.

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3.51 pm

Lord Astor of Hever: My Lords, I am grateful for the noble Lord’s welcome for a steady, costed withdrawal from Germany. I wrote as fast as I could, but I am afraid that I could not keep up with all of the noble Lord’s questions. I will do my best to answer as many as I can, but I undertake to write to him as soon as possible.

The noble Lord referred to previous Statements, particularly the July 2011 Statement. As the Defence Secretary said, today’s announcement presents an updated plan for the British Army which is built on where necessary, just as the plan announced in 2011. The further work we have carried out in the interim has refined the Army’s requirements and further identified value-for-money in our planning. It has sought out incremental savings and operational synergies in the way the Army operates.

The noble Lord particularly mentioned Scotland and the previous Secretary of State’s announcement in July 2011. The plans set out two years ago were on the basis of the Army operating a multirole brigade structure, but under Army 2020, published last year, the Army announced a significant change in its structure based on two key elements: reaction force brigades, centred on Salisbury Plain, and adaptable force brigades, based on regional headquarters. We will have an adaptable force brigade in Scotland, but it would not make sense to split the reactive force brigades between Salisbury Plain and Scotland, especially as we would need to purchase an additional training area in Scotland. Nevertheless, today’s announcement strengthens the Army’s presence in Scotland and implies an increase in the number of Armed Forces personnel based there of roughly 600 above the levels at the time of Dr Fox’s July 2011 announcement. This is a visible sign of our commitment to Scotland and to Scotland’s continual vital contribution and role in the United Kingdom’s defence.

The noble Lord asked me about the £1.8 billion expenditure and where it comes from. I can confirm that it comes from the capital budget and will not be at the expense of any redundancies. The point to remember is that it will deliver substantial savings from 2015 onwards.

The noble Lord asked me about RAF bases. We will be spending a lot of money both at former RAF Cottesmore and at RAF Leuchars. I do not have all the information at hand, and anyway, we are subject to contractual agreements, so I would not be able to give the noble Lord the figures. I will write to him in the best possible way that I can.

The noble Lord referred to the Armed Forces covenant and the pay body report. The Army has always looked to minimise effects on families of unit moves by ensuring that, where possible, any necessary moves are timed to allow personnel the ability to manage issues such as schooling and healthcare as easily as possible. While moving a great many Army families initially, this basing plan will give our personnel and their families greater long-term stability where they are based. This will allow them to integrate into the local community, their spouses to find long-term jobs and their children to have continuity in their education. Following the complete delivery of the plan, it is envisaged that

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the majority of units will not need to move again in the near future. The noble Lord asked me whether we are encouraging members of the Army and the Armed Forces to buy their properties. We are certainly doing that.

I can give the noble Lord confirmation that to the best of my knowledge no members of the Army will have to go into private rented accommodation. We are taking a great deal of trouble in working this out. Those members of the Army coming back from Germany will have suitable, adequate accommodation to move into with their families. We will consult the relevant government departments, local authorities and devolved Administrations about education and health. While the department recognises that the increase in personnel in some areas will increase demand on local services, many of the changes—for instance, Salisbury Plain—will not take place until the second half of the decade, which will allow time for resources to be appropriately redirected. Obviously, the education and health costs will fall on these local authorities but it is my understanding that they very much welcome these units moving into their areas.

The noble Lord mentioned Germany. We are very sad to be leaving Germany. I add to what the Secretary of State said in thanking the authorities there very much for all that they have done over the past six decades. I can confirm that the Secretary of State spoke yesterday to his German counterpart who, while being very sad, quite understands the reasons for us moving.

I think that that addresses most of the noble Lord’s questions. I know that there are a lot of unanswered ones and I undertake to write to him.

3.57 pm

Viscount Slim: The Minister made mention of training areas. To train an army properly with its ground-air support, great dedication must be given to the hours of darkness and night training. This always causes consternation among local government, various bodies and nearby inhabitants. What are the Government doing to ensure that night training is not sanctioned in any way in its most modern form today so that our military can consider and take part in proper night training within the United Kingdom? If we do not allow constant night training of our Regular Forces and Reserve Forces of all three services, we will not have much of an Army.

Lord Astor of Hever: My Lords, it is my understanding that a good deal of night training takes place in different training areas, such as Salisbury Plain, Otterburn in Northumberland and in Wales. We hope to keep the NATO training area in Germany after we move the rest of the Army out. Troops go to Alberta, Canada, for night training and to other countries, of which the noble Viscount is aware, including jungle training in Brunei.

Lord Palmer of Childs Hill: My Lords, last year in your Lordships’ House, as regards housing for the Army, I said:

“The bad news is that there will be a three-year pause in the improvements programme from April 2013”.—[Official Report, 23/4/12; col. GC 278.]

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That related to the report of the Armed Forces pay review body. We owe it to our soldiers to provide good and decent accommodation. Will the Minister confirm that we are doing that and how it fits into the earlier statement about having a pause in improvements in April 2013? Can he also say whether the £1 billion funding for housing in the Statement will not lead to calls for further cuts in welfare benefits?

Lord Astor of Hever: My Lords, I quite agree with my noble friend that we owe members of our Armed Forces decent accommodation, and we are going to considerable lengths to ensure that that happens. As I said in the Statement, we are spending £1 billion to provide some 1,900 new service family accommodation units and some 7,800 single living accommodation bed spaces. The intention is that the living conditions of those returning will be comparable to those of UK troops based in Britain and that the return of units from Germany to the UK will provide greater stability for the soldiers and the families involved.

I am afraid that I have forgotten the second part of my noble friend’s question, but this money is pretty much ring-fenced for accommodation. It will not be at the expense of other areas.

Lord Moonie: My Lords, the Minister will be well aware that any development such as this is a compromise between the need to save money and the need to maintain the footprint of the Armed Forces throughout the United Kingdom. What account has been taken of the difficulties that we appear to be experiencing in recruiting, particularly to the Reserve Forces, when Scotland, for example, is one of the major areas that we would hope to be recruiting from? This could be seen as a disappointment in that the footprint in Scotland will not be expanded as greatly as was originally thought.

I hope the Minister will forgive me a parochial point. Have the Government taken into account the availability of the Barry Buddon training area just across the estuary from Leuchars in deciding which units would be based there?

Lord Astor of Hever: My Lords, I cannot answer the noble Lord’s last question. I am sure that it was looked into but I will check. We are aware of the recruiting issue, particularly for the reserves. As the noble Lord knows, we have done a lot of work on the reserves and trying to build up recruiting. There will be a White Paper on recruiting for the reserves and I hope to make a Statement on that issue before the Summer Recess.

The Lord Bishop of Ripon and Leeds: My Lords, the Minister will recognise that those of us who come from Yorkshire will have mixed feelings about the Statement and since both Catterick and Ripon are in my patch, I share those feelings. On the one hand, so far as my experience at Catterick is concerned, I very much welcome the emphasis in the Statement on spousal opportunities for work, home ownership and continuity of schooling. Will the Minister reaffirm that individual soldiers and their families will be spending

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longer periods of time at a single base? That is what is necessary. It is not simply that they will return from Germany, but that they will spend a significant amount of time at one base in this country, which has often not been the case in the past.

On the other hand, the damage to Ripon of the closure of Claro barracks will be substantial in terms of the economic effect, friendships and the pride of the city. I have no doubt that that will be the same for other places where barracks are being closed. What support will be available to local communities, especially in comparatively small places such as Ripon, in order that those effects may be mitigated for the whole community in which those barracks are set?

Lord Astor of Hever: My Lords, I can confirm to the right reverend Prelate that our objective is to have units based in similar locations for a much longer period of time so that wives can be encouraged to get jobs and children will have continuity of education. We have set out in this basic plan, which I hope noble Lords have with copies of the Statement, all the different places where the units coming back from Germany are going to. I accept that there is a lot to digest in this and I am organising a briefing in the Ministry of Defence on 19 March. All the members of the Armed Forces and the civil servants who have been working on the plan will be there to explain everything to noble Lords. Indeed, noble Lords who do not normally come into the MoD are welcome to come along, and I would very much welcome the right reverend Prelate. We will be able to discuss the support that we are planning to give to all the local communities, in particular the smaller ones.

Lord Dannatt: My Lords, I welcome the Statement that the Minister has just repeated about the future basing of the Army and the answer he gave earlier that the money involved, the capital investment, will be ring-fenced. I assume that the Minister meant that the £1.8 billion should be ring-fenced, which I very much welcome. Army basing is one of the areas of doubt that now may well have been clarified. Of course, doubt is what reduces morale in the Armed Forces, but redundancy is another issue hanging over many members of the Army at present. While I accept that the basing policy now brings more clarity to where the Army is going to live, can the Minister tell us when the new employment model will be made known to members of the Army so that they know how they are going to live?

Lord Astor of Hever: My Lords, I was referring to the £1 billion which my noble friend asked me about; that is being spent on accommodation. The noble Lord mentioned morale and I quite agree about how important accommodation is to the morale of the members of our Armed Forces. I spend quite a lot of time looking at the accommodation for the three services and I do all I can to ensure that it is being upgraded. Likewise, the noble Lord mentioned basing. We are doing everything possible to pass messages on to members of the Armed Forces and their families so

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that they know exactly where they stand. The feedback I have been given suggests that it has been very well received by the Army.

Lord Selkirk of Douglas: Can my noble friend give an estimate of how long the transitional arrangements will take in respect of RAF Leuchars? Also, can he give an assurance that the runway will be kept operational in the mean time?

Lord Astor of Hever: My Lords, I can confirm for my noble friend that the runway at Leuchars will be kept in operation. I think that a university air squadron is based there and will continue to use it. Once the Typhoons have moved up to RAF Lossiemouth, we would want it as a failsafe runway for Lossiemouth.

Lord Davies of Stamford: My Lords, it is the wrong decision to bring back the Army from Germany at present, and to do so at very considerable cost. The Minister mentioned the figure of £1.8 billion. That would have been enough to have kept Nimrod going, to have maintained a Harrier strike force and to have bought all 22 Chinooks. The Government have demonstrated a very perverse order of priorities in this decision. It also deprives the Army of the training opportunities available in Germany which are much more extensive than Salisbury Plain, as the Minister knows very well, and of course of the opportunity for close collaboration in Germany with the Bundeswehr and the American army units stationed there, so it was the wrong decision. However, perhaps I may ask the Minister for a figure that he has not given. What is the estimate of the incremental costs in the future of flying our troops for training in Germany, Canada or in other places where they need more extensive training grounds—a need that would not have arisen had we maintained our position in Germany?

Lord Astor of Hever: My Lords, I am sorry that the noble Lord always finds something wrong with the announcements I make, but he forgets the very difficult financial situation that we inherited. I would point out that although we are spending a certain amount of money on bringing our troops back from Germany, huge savings of at least £240 million a year will be made from there on. I would much rather see the money spent in this country than in Germany.

Lord Burnett: My Lords, the Statement confirms that 45 Commando Royal Marines will remain at RM Condor in Arbroath. The marines of 45 Commando are this country’s specialists in mountain and arctic warfare. Arbroath has swift access to training areas in the Cairngorm mountains and is close to NATO’s northern flank. Since the war, 45 Commando has deployed with great distinction these important specialist skills on operations in the Troodos mountains in Cyprus, the Radfan mountains in Aden, and more recently in Afghanistan. Does my noble friend agree that this decision will be good for the Royal Marines and their families, for our defence capabilities—including recruitment —and also for Scotland?

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Lord Astor of Hever: My Lords, I agree with everything that my noble friend says about the Royal Marines. The Secretary of State was telling me last night how impressed he was when he visited them on winter training in Norway earlier this week. I agree with my noble friend that remaining in Arbroath will be good for the Royal Marines and for their families. As I said earlier, 45 Commando Royal Marines will remain in Arbroath for the foreseeable future. We investigated the feasibility of the move to the south-west but that option did not, at this stage, represent value for money and Arbroath is not needed for Army basing in Scotland. It is my understanding, as my noble friend said, that 45 Commando is very happy with this decision.

Lord Hamilton of Epsom: My Lords, I noticed that the Statement includes a proposal to sell off Hyde Park barracks, presumably because it is so incredibly valuable. Does my noble friend have any idea where the Household Cavalry would go if that was done?

Lord Astor of Hever: My Lords, that is a difficult question for me to answer. Of course, if the Household Cavalry Mounted Regiment was ordered to leave, it would have to go. However, as the Statement made clear, a lot of research needs to be done before it can move out. Suitable barracks would need to be found within the centre of London for it to move to, with all the costing worked out. It would be very complicated, but we would be irresponsible not to look into it.

Baroness Dean of Thornton-le-Fylde: I thank the Minister for the Statement, particularly for covering the continual running sore—as the Armed Forces Pay Review Body report this year confirms yet again—of accommodation. Is he confident that the new and refurbished housing will be ready for our troops and their families when they come home, knowing that this will have to go through the public procurement process—I presume—and knowing about the delay after delay that such processes in the MoD seem to attract? What processes have been set up to consult with the services families organisations? Accommodation is a problem but there is also the linked problem of an influx of young families requiring more school places, to go on lists for local doctors and dentists, and hospital accommodation, which was not mentioned in the Statement. What processes are in place to deal with that and to ensure that when these families come back, those facilities are there for them? Finally, how does this impact on the covenant, which we have all welcomed and which is important in the life of servicepeople?

Lord Astor of Hever: My Lords, we are of course well aware of the covenant and do everything we possibly can to stick by it. When I was in opposition, I went with the noble Baroness to visit quite a lot of accommodation. In the last two years we have done a lot of work on accommodation, as did the previous Government at the end, and it is hugely different now to three years ago. The level of Army accommodation is catching up with the Navy’s and the Air Force’s and, on the whole, is really good. I am very much looking forward to going down to Salisbury Plain, I hope next

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month, to see what has been done there recently and what the plans are. We are in discussion with Wiltshire Council about the very issues that the noble Baroness raises—hospitals, schools and all the others. These are issues that we have to deal with, but all the local authorities and the devolved Governments that we have been in touch with very much welcome the Army moving into their area.

The Earl of Erroll: Perhaps I might ask the Minister, in a slightly light-hearted way: if Scotland becomes independent will those troops stationed north of the border become part of the “Scottish Army”? If it does not, what does that do to his pronouncements about long-term stability and how they will not all get moved around?

Lord Astor of Hever: My Lords, the noble Earl asks a very good question. The creation of independent Scottish armed forces would not be as simple as transferring existing Scottish-recruited or Scotland-based units. The UK Armed Forces are a totally integrated, pan-UK organisation and parts cannot simply be broken off like bits of a chocolate bar. Individual members of the UK Armed Forces could not simply be co-opted. They would have to be given a choice and it is far from clear that Scots in the UK Armed Forces, or members of units recruited or based in Scotland, would automatically choose to join the armed forces of an independent Scotland. The prospect of being part of smaller, less globally active armed forces might be seen as less rewarding for some.

Lord Dannatt: With the indulgence of the House and an eye on the clock, perhaps I may ask the Minister a second question, given that my earlier question about the new employment model still hangs. I raised the issue of morale a moment or two ago. The capability of the Army is obviously very critical and its future capability is based on the integration of the Reserve Forces with the Regular Forces, about which this basing report is concerned today. When will we know the Reserve Forces basing plan? Clearly, successful delivery of our Reserve Forces is absolutely critical to the future capability of the Army, given that the Regular Army is being cut by 20%, which is unprecedented in recent times.

Lord Astor of Hever: My Lords, I can confirm to the noble Lord that there is a lot of work going on at the moment on the Reserve Forces basing plan and how that ties in with the Regular Army. As I said earlier, there will be a White Paper quite soon and I hope very much to give a Statement on this very important subject before the Summer Recess.

Welfare Benefits Up-rating Bill

Committee (2nd Day)

4.17 pm

Relevant document: 14th Report from the Delegated Powers Committee.

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Amendment 11

Moved by Baroness Lister of Burtersett

11: After Clause 2, insert the following new Clause—

“Duty on the Secretary of State

Before enactment, the Secretary of State shall lay before both Houses of Parliament a report which states—

(a) his assessment of the adequacy of the social security benefits listed in Schedule 1;

(b) the principles upon which the future up-rating of all benefits and tax credits covered by this Act will be based.”

Baroness Lister of Burtersett: My Lords, Amendment 11 is in part inspired by the speech made by the right reverend Prelate the Bishop of Leicester at Second Reading. He suggested that this was an occasion for considering,

“the moral responsibility of this House”,

and warned that this Bill,

“looks like part of an ideologically motivated attempt to alter the very nature of the welfare state”.—[

Official Report

, 11/2/13; col. 469.]

He voiced his fear that we are heading towards a US-style system, where pensions are protected,

“but working-age provision is less generous and more stigmatised, barely providing enough for people to live on without relying on charitable handouts”,

and asked:

“Is this really the kind of society that we want to live in?”.—[Official Report, 11/2/13; col. 471.]

It certainly is not the kind of society in which I want to live.

The purpose of this amendment is to facilitate a debate on that fundamental question of the generosity of benefits for working-age people and their children. The first part addresses the question of whether the social security benefits affected by this nasty Bill are adequate in the first place, and the second the principles that should govern the uprating of benefits in the future once the Bill’s provisions have ceased to have effect. Of course, the two questions are related because the current level of benefit reflects uprating policies over the years.

As the House of Commons Library briefing notes:

“It is a misconception that benefit rates in the UK are based on some regular, systematic estimate of minimum needs”.

In fact, they are not even based on an irregular systemic estimate, for as the briefing points out,

“no government has … attempted any official empirical study of adequacy”,

since a covert study undertaken by the National Assistance Board back in the 1960s, despite countless fundamental reviews of social security, which some of us have lived through to tell the tale.

There are various indicators that we can use to assess benefits’ adequacy. The most basic is whether they are sufficient to keep people out of poverty and, patently, they are not, as so many people living on benefits are in poverty if one uses the relative income and material deprivation measures. The income support received by, for example, a couple with two children or

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a lone parent with one child is around 30% below the poverty line. Briefings from children’s charities underline the hardship that families already experience as a result. For instance, research undertaken by Barnardo’s among its service users found that two-thirds were cutting back on fuel and half were borrowing money. Three-quarters reported that food poverty was impacting on their children’s health and well-being. Similarly, a Children’s Society survey of teachers found that nearly half of those surveyed are seeing children coming into school hungry. Recent peer research undertaken by five Gingerbread community researchers in partnership with the Poverty Alliance found many lone parents skipping meals to feed their children. As one said, “Occasionally, I’ll miss meals and things like that just to make sure that they get wee bits and pieces. It makes me feel better about them having than me having”. This is an example of a common phenomenon, where mothers deprive themselves of basics to try to protect their children against the worst impact of poverty, as they act as the shock-absorbers of poverty. It is an example, too, of a point made by the noble Baroness, Lady Howe of Idlicote, on our first day in Committee about how women are disproportionately affected by the Bill.

The most sophisticated benchmark of adequacy is the minimum income standard developed by the Joseph Rowntree Foundation. It represents what members of the public through group discussion have arrived at as the minimum acceptable standard of living: what you need in order to have the opportunities and choices necessary to participate in society. I emphasise that it is about needs, as socially determined, rather than about wants.

The latest calculations indicate that a couple with two children, or a lone parent with one child living on the basic safety net benefit of income support, receive only three-fifths of the income needed to meet the minimum income standard. A single working-age person receives only two-fifths. The researchers, who are colleagues of mine at the Centre for Research in Social Policy at Loughborough University, observe that, because increases in costs have not been adequately captured by the consumer prices index, out-of-work benefits fall even further short, providing a lower minimum income living standard for non-pensioners than they did in 2008 when the MIS was first calculated. They concluded, even before this Bill was proposed, that the gap between the incomes and needs of the worst-off households is widening, especially for families with children. While the JRF is not suggesting that benefits should be raised to the level of the MIS, the sheer scale of the shortfall is indicative of how far they fall below the decency benchmark established by members of the public.

Policy has been more successful in ensuring that pensioners can achieve minimum income standards, which is of course a good thing, but according to Professor Jonathan Bradshaw, the decision to uprate pensions by 2.5% and working-age benefits by 1% for three years is going to exacerbate further the absurd differentials in benefit rates that have developed over time. In 1948, a single pensioner received only 10p more than a single person on national assistance.

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Now, a single female receives £71 per week in jobseeker’s allowance. When they are eligible, they get £142.70 on pension credit. A lone mother with one child gets only £133.21 a week. These differentials, Professor Bradshaw says, clearly have nothing to do with need.

That brings us to the second half of the amendment, on the principles underlying uprating policies. The significance of these policies was underlined in an earlier JRF study. It pointed out that uprating policies have big effects over time. They are among the most significant decisions taken by Chancellors. Their gradual effects seem imperceptible on a year-to-year basis yet they carry immense implications for the future. This year’s decisions will certainly be perceptible, and the implications for the future are even more immense, because, whatever decision is taken by future uprating policies, they will be uprating benefits that have been significantly depressed in real terms over a three-year period.

The report called for a more open debate about this often hidden area of public policy, so that decisions that prevent the poorest members of society keeping up with rising living standards would not be taken in the dark. Unknown to most people, uprating policies have resulted in a significant erosion of relative living standards among benefit recipients over most of the past three decades. Recently, this has been exacerbated by the use of CPI rather than RPI as the measure of inflation, particularly during the period when prices of necessities that represent a disproportionate share of spending among benefit recipients have risen faster than prices generally—a point that we made on the first day in Committee. As Donald Hirsch of the Centre for Research in Social Policy comments, in this context, the index used to uprate benefits has become a highly imperfect mechanism for preserving their real value and a rather arbitrary means of raising benefits by an amount that politicians feel that the country can afford rather than of protecting living standards.

Of course, assessments of affordability cannot be ignored. They can also be contested, as we are doing in relation to this Bill, but looking to the future I agree with Donald Hirsch that there is a need to establish principles linking benefit uprating to some stable concept of what is fair, rather than just ad hoc decisions about what can be afforded. He suggested that, as a start, this might involve reasserting the principle of human decency whereby the real value of benefits is genuinely protected and that, in the longer term, if prosperity starts to grow again, we need to consider how those in greatest need can share in such growth.

I suggest that a report to Parliament that addresses these fundamental questions is the least that we can ask of a Secretary of State willing to preside over a deliberate reduction in the living standards of the most deprived members of our community. I beg to move.

The Lord Bishop of Ripon and Leeds: My Lords, I have put down my name in support of the amendment and am very grateful to the noble Baroness, Lady Lister, for her tabling of it and for her powerful advocacy of it. I have done so because I am repeatedly told by citizens advice bureaux and the like of the uncertainty which is being introduced by this Bill. It is

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ironic that we have talked so much of certainty in setting the rates for the years up to 2015-16, when those on benefit and providing advice feel uncertain as to its short and long-term effects.

So long as benefits have been uprated by inflation, it has been possible to budget taking them into account. But this cap on uprating is a major and apparently long-term change to the whole principle of our benefit system. Recipients and those who work with them are owed an explanation. I am not looking for commitments from either Front Bench beyond 2015, but I would be very grateful for comment from both of them on whether this is to be seen as a temporary reduction with the aim of restoring benefit values after 2016 so that we ensure a decent living standard for those on benefit—the requirement that has been so ably put by the noble Baroness, Lady Lister. Or is this actually a permanent reduction to a lower level, which will then be stabilised in real terms after 2016, or a continuation of a gradual reduction expected to continue after 2016? None of those options is desirable, but they are very different in the effect that they will have, and a sense of purpose and direction from the Government and Opposition is important in all this. It is important to know just where benefits are anticipated to be going in future, both from the opposition and the government Front Bench. I hope that they can supply that in the debate on this amendment.

4.30 pm

Lord Kirkwood of Kirkhope: My Lords, I will make just a short intervention on this amendment so ably moved by the noble Baroness, Lady Lister. I entirely concur with her view and analysis. I want to add, however, the fact that I am now very frightened about what is happening in the short term. There is a complacent view held among policymakers generally that the Work Programme and universal credit are all that need be done. I support both, and will not cast any aspersions on any Governments or make any party political points, but both these important reforms will take at least 10 years to go into steady state and be of assistance to our most hard-pressed, low-income households in the United Kingdom.

If I am right about that, and about the prognosis for the United Kingdom’s level of economy over that period, we face a really difficult period of activity where we cannot rely safely on the Work Programme and universal credit to provide the social protection that this country needs and expects. We need to do something in the short term that seeks to understand what is going on. More than anything else, this is a plea for really rigorous and urgent monitoring of everything going on: every bit of evidence from every constituent part of the United Kingdom. We need to watch carefully what is happening. The noble Baroness is quite right: malnutrition of children will result over the next five to 10 years if we are not extremely careful.

Now, this is no one’s fault. I understand perfectly well the need to get austerity and deficit reduction properly balanced in the nation’s future policy at a financial and fiscal level. But nobody could have foreseen the difficulties or longevity of the recession, or the lack of growth that this country will have to deal with

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in the short term of five to 10 years. That does not seem like a long time and I do not take anything away from the long-term need to get universal credit and the Work Programme put together and rolled out, but nobody is paying enough attention to what is going on in the short term.

If you refer to the sensible policy professionals who look at this, the Joseph Rowntree Foundation is first among them and there is the work by Loughborough University, Professor Jonathan Bradshaw, and all these experts. We have better professionals in the United Kingdom than any other European country. I say that because I have worked with most of them for the best part of 25 years. The noble Baroness is one of them— she nodded at that point. This is a serious point: we have internationally recognised experts on this yet we are deaf to what they say to us. A growing body of opinion says that something different and more than what has been put in the policy framework to date needs to be done to be sure that we do not face levels of financial adversity with which the public will not be comfortable.

I know that there is a view that people are against welfare spend and we have had discussions over the Welfare Reform Act and this Bill about the language used nationally in the public discourse on this important area of public policy. It is important because £200,000 million a year is spent and it is still creating problems. We need to face up to that. We need to have a much more adult discussion about what is going on.

Certainly, concepts such as the minimum income standards need to be part of that discussion. We need to look at the cumulative effect of everything that has happened since 2010 that has made the circumstances dramatically worse. People know that I am a professional, paid-up pessimist—I accept that—but we have to be very careful about how we assess the evidence.

I want to make a couple of quick suggestions about how we might deal with that in conjunction with looking at the principles in the long and short term and how we perform the monitoring and evaluation. What is happening in the devolved legislatures of the United Kingdom is very important. There are positive responses in Wales, and in Scotland, which I know best, where the need is recognised. We must first promote the need to do things differently. That may mean financing food banks—that is not something that I want, but if the alternative is malnutrition in children, we cannot ignore that. It is easier in smaller countries which have shorter lines of communication and a smaller scale. They can move more flexibly and faster. Working with the legislatures in Cardiff and Edinburgh, I think that there are some quick wins that central Government could help to promote. I hope that we will do that and keep the channels of communication between London and the constituent legislatures throughout the rest of the United Kingdom open and dialogue promoted urgently.

As the second part of that, working with local authorities will be so important. The evidence coming back from housing authorities, particularly in local authorities, presents variable geometry—we are getting different messages from different parts of the country. There is a spatial dimension to some of these issues

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which we should not ignore. In the past, we have always safely relied on a centralised, unified United Kingdom social security process as the right thing to do. I have less confidence about that working in the next five to 10 years. We need to look much more carefully at how housing and labour markets are aligned in some regions of our United Kingdom and be sensitive to changes happening in those fields.

I think that we need a short-term anti-poverty strategy. The principles covered by the amendment of the noble Baroness are important and must be kept in mind for the longer term, but all my instincts tell me that the next three, five or seven years will be difficult in a way that nobody has previously been able to get a grip on. If we do not respond to that by looking at some of the ideas contained in the amendment, we will pay a heavy price in terms of child poverty, in particular. We have an important amendment coming up next on that subject, and I hope that we will think carefully about that as well.

In strongly supporting the concept behind the amendment, I would like the Committee to consider not just the longer and medium term but some of the emergency state provisions that we as a country will be forced to face over the next five to 10 years.

Baroness Sherlock: My Lords, this has been an interesting brief debate, introduced by my noble friend Lady Lister with her now characteristic blend of expertise and passion. I am sure that we are all grateful to her for opening up the question so well. The quotes that she shared with the Committee about children arriving hungry at school and mothers missing meals and going without themselves to protect their children from the effects of poverty were, on one level, not a surprise to any of us, but they are still shocking. They should be profoundly shocking.

I found the point made by the right reverend Prelate very interesting and I understand why he would like those assurances from both sides of the Committee. My noble friend Lord McKenzie of Luton made Labour’s position clear at the beginning of our first day in Committee. It is this: if we were in government right now, we would be uprating benefits in line with inflation. However, we cannot make a commitment at this stage for the next Parliament. My view is that that is not a good idea anyway. We are fundamentally opposed to the whole principle in the Bill of fixing the levels of uprating for a period. We have perfectly good mechanisms for uprating benefits annually in line with inflation in the light of prevailing economic circumstances. To be honest, I would not want to be tempted into anything other than maintaining that position, but I fully understand why the right reverend Prelate is pressing the concerns that he is pressing.

I also found the comments made by the noble Lord, Lord Kirkwood of Kirkhope, very interesting. He drew in the spatial dimensions of poverty and the wide-ranging regional issues. That is something that we may come back to. I particularly agreed with his point about the need to monitor what is going on. The next amendment that I shall move encourages the Government to look specifically at the impact on child poverty. I also support the noble Lord’s point about

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the need for a cumulative assessment of all the changes between 2010 and now—a point made very strongly by my noble friend Lady Hollis at earlier stages of debate.

Since the Bill cannot help but drive down standards of living for families, what assessment have the Government made of the likely impact on the well-being of the poorest adults and children of what is effectively a real-terms cut in benefits and tax credits, not just over the year ahead, but over the three years covered by the first uprating and the two years of this Bill? It would be very helpful to the Committee to understand what assessment the Government have made. At a time when three new food banks are opening every week and even families in work are finding it a struggle to make ends meet, the state needs to take particular care to demonstrate that resources are gathered and distributed in a way that is fair to everyone. In the light of that, I shall be very interested to hear what the Minister has to say.

Baroness Stowell of Beeston: My Lords, I am grateful to the noble Baroness, Lady Lister, for moving this amendment and explaining her thinking. Of course, I recognise the serious issues that she and other noble Lords have raised during the course of this debate. I would not claim first-hand experience of living on benefits, so I do not bring to this debate any presumption about those on benefits finding what we are doing anything other than difficult, but is an inescapable fact that when setting benefit levels successive Governments have sought to strike a balance between the needs of claimants, maintaining work incentives and affordability.

Indeed, the current uprating legislation recognises this explicitly. The Social Security Administration Act 1992 requires the Secretary of State to make his annual review of benefit levels based on the increase in prices. He is then given discretion as to how to uprate certain benefits, having regard to the national economic situation and any other matters that he considers relevant. Parliament therefore requires the Secretary of State to take certain issues into account when considering the level at which the benefits in question are set. In bringing forward this Bill, we have considered these issues carefully and struck a balance between providing a cash increase, protecting certain key benefits and making necessary savings.

Benefit levels also have a significant bearing on work incentives. The complexity of the current system largely arises from successive Governments’ attempts to balance benefit income against work incentives. That is why universal credit is such an important measure as it applies a single set of rules focused on maintaining the incentive to take up work or more work. In response to some of the points made in this debate, I shall say something that I know is shared around the Committee. This Government believe that work is the best route out of poverty, and that is why we are focused on making sure that work pays.

4.45 pm

I think it was the noble Baroness, Lady Lister, who talked about how benefits could impact on people living in poverty. We believe it is misguided to try to

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lift people over the 60% median income line through benefit increases alone. This does not change their lives or those of their children because it does not tackle the reason they find themselves in poverty in the first place. We accept that most benefit rates are below the 60% median income line that measures relative poverty but it has never been the intention to alleviate poverty through benefit payment.

Universal credit will channel more money to those at the bottom end of the income scale and will allow people to keep more of their own income as they move into work. We expect some 3.1 million households to gain from the move to universal credit, on average by about £168 a month. Around 75% of those gainers will be in the bottom 40% of the income distribution, and it is estimated that the change in financial incentives brought about by the introduction of universal credit will result in a net reduction in the number of workless people by up to 300,000.

My noble friend Lord Kirkwood, in his usual eloquent way, talked about the need to monitor the impact of the changes that we are making in this uprating Bill on those who are directly affected. I remind noble Lords of something that I said last week in Committee, which is that the Government recognise that very soon—from April this year—a lot of the changes that we talked about in theory during the passage of the Welfare Reform Act will be implemented. I want to reassure the Committee that the Government take very seriously their responsibility for monitoring the effects of the changes that will be implemented through the Welfare Reform Act. We have put in place a number of measures to make sure that there are no unintended consequences. The noble Lord, Lord Kirkwood, spent a lot of time on this and, because it is so important, I want to go through some of the issues.

First, it is worth reminding the Committee that we have a transitional protection that means that no one moving to universal credit will lose out in cash terms when they are migrated by the DWP. There is a discretionary housing payments fund, which has been in existence under previous Governments. Since 2001, the contribution to discretionary housing payments has been £20 million a year, whereas this Government have significantly increased that budget. We are investing £155 million for discretionary housing payments in the next financial year and up to £125 million the following year.

Baroness Hollis of Heigham: Would the Minister agree that the last increase she mentioned has come about by increasing the additional cuts that people will have to face as a result of the bedroom tax?

Baroness Sherlock: I am sure the Minister is aware that the IFS analysed the distributional impact of tax and benefit changes between January 2010 and April 2015 as if universal credit were fully in place. It modelled the real-terms changes in household income at today’s prices with all the measures announced and UC fully implemented. It suggests that a one-earner couple with children will be £64 a week worse off. How does that equate to what she is saying?

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Baroness Stowell of Beeston: I have laid out for the Committee the measures that are there and have been put forward by the Treasury. The noble Baroness wants to put forward some alternative statistics. Let me get back to the point I was making about the arrangements that are being put in place to ensure that, when we move into the implementation phase, support is available for those who need it, if there are any people who are not properly covered by the changes that we are making.

The noble Lord, Lord Kirkwood, referred to local authorities when he was talking about this. The local authorities and the Scottish and Welsh Governments would get £178 million to deliver new local welfare provision. They will develop local schemes to help those facing a crisis or short-term unavailable need. On the arrangements for people moving from weekly receipt of payments to monthly receipt, a whole range of different programmes is being put in place to support people in budgeting and making sure that they have the support that they need to manage the changes that are being brought about—changes that we believe will have the right effect in ensuring that this is a much simpler and more effective welfare system.

The noble Lord, Lord Kirkwood, and the noble Baroness, Lady Sherlock, also referred in this context to food banks. I point out to noble Lords that one reason why there has been an increase in the use of food banks is because the Government were clear that we wanted Jobcentre Plus advisers to be able to signpost their availability to claimants. For reasons that noble Lords on the other side of the House will presumably be able to explain, this was not possible before. The Trussell Trust director has said that he thinks that there has been a need there for a while, but the growth in the number of volunteers and the awareness that you can get this help if you need it explains the growth in this area.

Lord Martin of Springburn: Is it not a sad day when a government Minister has to stand up and say that food banks will be made available? Our children should not have to depend on food banks in this day and age.

Baroness Stowell of Beeston: It is a sad fact that people should have to rely on food banks; I absolutely acknowledge that point and do not dispute it at all. The point I am making to the Committee is that Jobcentre Plus staff are now permitted to signpost the fact that they are available, whereas previously they were not permitted to do so. I am not suggesting that the fact that they exist is to be applauded at all, but it would be wrong for Jobcentre Plus staff not to be able to say that they are there to people who might be able to take some advantage of them just because we do not want to make that facility known.

Baroness Farrington of Ribbleton: The Minister is speaking as though the only people using food banks are those who go to the jobcentres. Surely, from my experience and that of other noble Lords, many of the people who are now using food banks are actually in employment. As things like the bedroom tax bite, more people in employment will lose out on what benefits were available to them.

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Baroness Hollis of Heigham: My Lords, to add to my noble friend’s point, my obviously localised and limited experience of food banks has been that before about 2010, in so far as they were in play, food banks were mostly drawn upon by young people. These were very often young men aged under 25 who were getting the shared rate for housing benefit in the private rented sector and found, as Shelter and others have told us over the years, that it did not match the rent they were required to pay; it was a very discrete group. They, in my localised experience, often had to turn to food banks to cope. Now the Government have extended that limitation on housing benefit from 25 to 35, while producing additional pressures right across the benefits spectrum, as my noble friend Lady Farrington has said. It is a disgraceful aspect of the fifth-richest nation in the world that so many of our people have to make recourse to food banks because our benefit system does not sustain them in the way it should.

Baroness Stowell of Beeston: My Lords, I do not for one moment suggest that food banks are something on which anybody would want to have to rely. I completely agree with the noble Baroness in that regard. My point is simply that the fact they exist—

Lord Martin of Springburn: I suggest to the Minister that we should be ashamed that this is happening. I was brought up in the 1950s in a family of the poorest of the poor, and my parents would not have dreamt of going to a food bank. All these years later, we are talking of parents and children having to go to a food bank. If this so-called facility exists, the Government should do something to eradicate the need for food banks.

Baroness Stowell of Beeston: My Lords, food banks have existed for a long time. They have not been introduced in recent times—that was the point I tried to make by quoting the director of the Trussell Trust. I am not trying to make any point about this whatever. I do not for one moment suggest that anybody in this House should feel anything other than great disappointment that anybody should have to use a food bank. I am making a simple point. All noble Lords have been clear about their views, and certainly I am not here to disagree with the arguments they made. Let me move on.

The noble Baroness, Lady Lister, while accepting the need to strike a balance, argued none the less that a report into the adequacy of benefit levels would be useful, as it would help people better understand where benefit incomes sit in relation to the rest of society, and so would help inform the debate. This approach relies on the idea that we could produce figures that would concretely situate benefit incomes in relation to an objective adequate level. The desire to draw conclusions on the adequacy of benefit levels has always been fraught with technical difficulties. In 1985, the then Government looked at this issue and concluded that,

“it is doubtful whether an attempt to establish an objective standard of adequacy would be fruitful … all such assessments would themselves include judgements on the standards to be achieved”.

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This view was echoed in the previous Labour Government’s consultation exercise on measuring child poverty, which concluded that,

“despite a wide range of research into budget standards, there is no simple answer to the question of what level of income is adequate … Different research methods tend to make different assumptions that are essentially subjective”.

Similarly, during her time as Minister at the Department for Work and Pensions, the right honourable Margaret Hodge said, when asked what assessment the Government had made of the minimum income a household needed to live on:

“Our concerns about research on minimum income standards have been well documented. What people need to live on varies greatly depending on their needs and a range of factors. Different research methods tend to make different assumptions and generate a range of estimates”.—[Official Report, Commons, 7/2/06; col. 1163W.]

The noble Baroness, Lady Lister, also raised the issue of minimum income standards, and suggested that this metric could be used as a measure of benefit adequacy. We will continue to take note and look carefully at the evidence from research on minimum income standards. However, I do not believe that minimum income standards provide an appropriate comparator when considering the adequacy of benefit rates.

The Joseph Rowntree Foundation’s minimum income standard is a relatively new metric—the first report was in 2008—and there is no international consensus on how this should relate to setting benefit standards. Minimum income standards are informed by public perception so can change even if prices do not. For example, the rate for a couple with two children increased by a third between 2008 and last year—more than twice the rate of inflation. Moreover, it is important to remember that most working-age benefits are intended to provide temporary support during periods of interruption to employment, whereas the minimum income standard is focused on more long-term living standards. The Bill does not, of course, affect long-term benefits, such as those paid to pensioners or those relating to additional needs arising from disability.

5 pm

I do not believe that there is a straightforward and meaningful way of determining the adequacy of benefits. Moreover, when considering the level at which benefits are set, we cannot forget the other factors to which I have already alluded: namely, the need to give due regard to questions of affordability and work incentives. I am also not convinced that statute is the right place to provide for the kind of analytical work which the noble Baroness proposes. What I can say is that the Government remain mindful of benefit rates at all times. We make extra support available to those claimants with extra needs. Most crucially, we will continue to focus on ensuring that work is the best route out of poverty.

Baroness Hollis of Heigham: My Lords, the Minister seems to imply throughout her speeches that there is a distinction between those receiving benefits and those who are in work, and that you have to maintain that gap to produce work incentives. That seems to be her

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argument. However, she knows that two-thirds of the current expenditure on housing benefit and tax credits goes to people in work on the minimum wage to make that wage adequate to enable them and their families to survive. Therefore, will she please refrain from talking about the need to maintain work incentives when the only way that there is an incentive to work is when it is underpinned by benefits?

Baroness Stowell of Beeston: With the introduction of universal credit, we will make sure that that is always the case. Therefore, I do not disagree with the noble Baroness at all.

The noble Baroness, Lady Lister, referred to the Government’s decision to move from RPI to CPI as the appropriate index of inflation. The Government believe that CPI is a more appropriate measure than RPI when considering the impact of inflation on benefits and pensions. It is worth saying that the judicial review of the switch from RPI to CPI found in the Government’s favour and we continue to believe that CPI is a more appropriate index. As an example of the costs involved, uprating the benefits and payments in this Bill by earnings would reduce the savings by £1.8 billion of the total of £1.9 billion in 2015-16 and, if we did so by RPI, would wipe out all the savings and cost an additional £700 million in 2015-16.

As regards paragraph (b) of the amendment, while I cannot predict the decisions that will be made by future Governments, once the provisions in the current Bill cease to have effect, the default position will be for uprating decisions to be made in line with pre-existing legislation.

In referring noble Lords to the comments made by the noble Lord, Lord McKenzie, during last week’s debate, I was going to mention his reluctance to say what his party would do if it was in government. Indeed, he was even more than reluctant; he refused to say what it would do. However, the noble Baroness, Lady Sherlock, has commented on that point today.

For social security benefits and statutory payments, the default position will be for uprating decisions to be made under Section 150 of the Social Security Administration Act 1992, meaning that the Secretary of State will make an annual review of benefit levels to see whether they have kept pace with the increase in the general level of prices. If prices have increased, he will then make a decision about how he should uprate the benefits covered by the Bill, based on the national economic situation and other factors he considers relevant. For tax credits, the default position is that the Treasury is required under Section 41 of the Tax Credits Act 2002 to review the amounts of certain elements of tax credits each year to determine whether they have retained their value in relation to the general level of prices.

Before I conclude, I refer to the question put by the noble Baroness, Lady Sherlock, about an assessment of the changes that we are making via this Bill on the well-being of adults and children. In response—and it was a point that I made in Committee last week—this Government publish cumulative impacts of government policy at every major fiscal event. We did so at the time of the Autumn Statement last year. Those assessments include the effects of any changes in welfare and

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ensure that the other positive measures being introduced in relation to tax rates and so on are taken into account. That represents an increase in transparency when compared with what was in place hitherto. The assessments are publicly available on the Treasury’s website.

This has clearly been a serious debate and I am grateful for the opportunity to respond. I hope that in future debates I am able to expand a little further on some of my comments because I am concerned that in some of my points I was not as clear as I intended to be. I will ensure that when I speak in later debates I am much clearer about the importance we place on ensuring that proper consideration and monitoring are taking place in the implementation of all these changes. If any additional measures are required to support people who are affected in a way that goes beyond that which we are expecting, we will make sure that they have the support they need.

The Lord Bishop of Ripon and Leeds: My Lords, following the Minister’s final comments, can I check that the default position after 2015-16 will be that there would be CPI increases based on the lower level that benefits will have reached by then?

Baroness Stowell of Beeston: It will be based on the benefits that exist at that time.

Baroness Lister of Burtersett: I start by thanking the right reverend Prelate the Bishop of Ripon and Leeds for supporting the amendment so powerfully. He asked for a sense of direction. I fear that we have a sense of direction but it is not one that either the right reverend Prelate or I feel happy about. I thank the noble Lord, Lord Kirkwood, who, as ever, has brought important issues to light. I also thank my noble friend Lady Sherlock who again made a powerful speech. I also thank the Minister, whose attempt to deal with the issues raised by the amendment I acknowledge and appreciate. She was given rather a hard time but I am sure that she will understand because people feel strongly about the implications of the Bill and the effect it will have on benefits. I should like to address a number of her points.

First, my noble friend Lady Hollis picked the Minister up on this mantra that work is the best route out of poverty. Of course we all agree with that, except that work is not always the best route out of poverty because some people are going to work and are in poverty. As well as the point made by my noble friend, there seems to be an assumption that if we depress benefit levels we are somehow making it more likely that we will push people into paid work. I always remember work on lone-parent families carried out by another poverty guru, Alan Marsh of the Policy Studies Institute. He pointed to evidence that,

“a malign spiral of hardship, poor health and low morale … builds up its own barriers to work”.

He found that those in severe hardship were three to four times more likely to suffer low morale, compared with those who were not in hardship. He very wisely commented:

“It is quite hard to contemplate work if you are that demoralised and hard up”.

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That is why we must not assume that keeping benefits low is necessarily going to improve work incentives.

The Minister made a point that I found quite chilling. She said: “It has never been the intention to alleviate poverty through benefit payment”. That is not my understanding: I thought that the whole point of benefits was to try to alleviate poverty. I am dismayed by that statement.

Baroness Stowell of Beeston: What I said was that we believed it was misguided to try to lift people over the 60%-of-median-income line through benefit increases alone, because this would not change their lives or their children’s since it would not tackle the reason they found themselves in poverty in the first place.

Baroness Lister of Burtersett: I accept that, but I wrote down what the noble Baroness said. She said: “It has never been the intention to alleviate poverty through benefit payment”. I wrote it down. If she wants to retract that statement, I would be delighted.

Baroness Hollis of Heigham: I think it was at the point when the Minister said that unemployment benefits were only intended to be temporary while people were in between work, and that therefore they were never expected to address poverty as such. That is the problem that we are worried about.

Baroness Stowell of Beeston: This is a debate about the adequacy of benefit rates, not about benefits in a package of what people receive. The difference here is that if somebody is in receipt of a combination of different benefits—housing benefit, jobseeker’s allowance and so on—I can absolutely see the point that the noble Baroness is making. What I am saying in the context of a debate about how to set the rate of a benefit is that benefits alone do not alleviate poverty.

Baroness Lister of Burtersett: I thank the Minister for her clarification. I think I can take it that it is not the Government’s position that benefits are not there to alleviate poverty; I hope that is right. The noble Baroness must remember that not everybody can take the route into paid work: there are some people of working age who will be on benefits for a considerable length of time and we cannot just say, “Oh well, they don’t matter”.

There was quite a lot of discussion about food banks. It just so happened that I chaired a meeting the other week for a group called Just Fair, where the director of the Trussell Trust was speaking. He pointed out the exponential increase in the number of food banks over recent years. The increase is huge. That meeting was addressed by the UN rapporteur on the right to food. He made it very clear that he did not see food banks as any kind of solution to the problem of food poverty. I accept that the Minister was not saying that she was happy about the spread of food banks, but I think she was, perhaps, underplaying the extent to which they have spread recently. I do not think it is simply because Jobcentre Plus is now acting as a signpost.

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I was disappointed that the noble Baroness was referring back to quotes from 1985 about the difficulties of establishing the adequacy of benefits. Research has become a lot more sophisticated since then and there is a growing consensus—although clearly not on those Benches—around the work done on minimum income standards. When my noble friend Lady Sherlock asked about impact, I do not think she was asking for the same kind of impact statement that we have been talking about—the numbers and so forth. She was asking for an impact on well-being. Local authorities are now supposed to address the well-being of everyone in their areas. What impact is this Bill—together with all the other things that are happening—going to have on the well-being of children and their parents? This goes back to what the noble Lord, Lord Kirkwood, was saying about monitoring. Monitoring is not simply about numbers: it is about what it is going to mean to the lives of some of the most deprived members of our community.

I am disappointed that the Minister is not prepared to accept an amendment which is not about spending money; it is about trying to let us better understand the principles that should govern our social security system when times are easier. However, I beg leave to withdraw the amendment.

Amendment 11 withdrawn.

5.15 pm

Amendment 12

Moved by Baroness Sherlock

12: After Clause 2, insert the following new Clause—

“Assessment of impact on child poverty

The Secretary of State shall, in making the orders referred to in sections 1(1) and 2(1), publish and lay before Parliament a report assessing the impact of the order on the number of children living in—

(a) relative low income;

(b) combined low income and material deprivation;

(c) absolute low income;

(d) persistent poverty;

as defined in the Child Poverty Act 2010.”

Baroness Sherlock: My Lords, Amendment 12 is in my name and that of my noble friend Lord McKenzie of Luton. This amendment would require the Secretary of State to publish and lay before Parliament a report assessing the impact of the order on the number of children living in the four measures of child poverty set out in the Child Poverty Act; namely, relative low income, combined low income and material deprivation, absolute low income, and persistent poverty. The aim is very simple. It is to force the Government to face up to the consequences of their actions and to come clean about the impact of these measures on child poverty.

I am sure that the Minister is closely familiar with the coalition agreement. I know that I read it regularly, so I expect no less of him. My favourite bit is paragraph 14, the first bullet point of which reads:

“We will maintain the goal of ending child poverty in the UK by 2020”.

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That is rather lovely and has a beauty in its simplicity. I will repeat it:

“We will maintain the goal of ending child poverty in the UK by 2020”.

In keeping with that commitment, the Government have previously published the effect on child poverty of Budgets, spending reviews and Autumn Statements. But in the last Autumn Statement we did not get the kind of detail that we were expecting. Why could that be? We got a hint in a Written Answer in another place from the honourable Esther McVey when she said:

“We estimate that the uprating measures in 2013-14, 2014-15 and 2015-16 will result in around an extra 200,000 children being deemed by this measure to be in relative income poverty compared to uprating benefits by CPI”.—[Official Report, 15/1/13; col. 716W.]

It probably is important to look at the backdrop to this. Since the goal of ending child poverty by 2020 was first announced in 1999, the UK has made real progress. Some 1.1 million children were taken out of relative child poverty between 1998-99 and 2010-11, and 2.1 million children were taken out of absolute child poverty between 1998-99 and 2010-11. But now we are going into reverse. The rise in child poverty likely to be caused by these measures is on top of a net rise in child poverty of 400,000 by 2015 and 800,000 by 2020, resulting from the Government’s current fiscal policies, as seen in the IFS analysis of 2011.

If that is right—the Institute for Fiscal Studies has a pretty good record on these things—that means a rise in child poverty of at least 1 million children under the relative low-income measure is now likely by 2020. However, the relative low-income measure is just one of the four poverty measures in the Child Poverty Act. I should like to ask the Government why Ministers have not given any figures on the number of children who will be pushed into absolute poverty by the Bill, despite the fact that the Government have the same capacity to produce an estimate on that measure as on the relative low-income measure. I look forward to hearing the answer because, as the Minister will realise, the Government have a statutory duty to reduce absolute child poverty under the Child Poverty Act. Therefore, they presumably must be able to measure it to know if they have fulfilled that statutory duty.

Similarly, the Government have given no assessment of the likely impact of the Bill on material deprivation, despite again having a statutory duty to reduce material deprivation under the Child Poverty Act. Even if Ministers did not feel able to produce a numerical estimate, I cannot see any reason why they could not produce a narrative assessment, a point made repeatedly by the Child Poverty Action Group. Finally, and at the risk of being repetitive, we have seen no assessment, not even a narrative one, of the impact of the Bill on persistent poverty, despite the fact that yet again the Government have a statutory duty to reduce persistent child poverty under the Child Poverty Act.

This really is a disgrace after all the careful progress that has been made. The reason the previous Government took child poverty so seriously was that it had risen so dramatically under the previous Conservative Government. The researcher, Jonathan Bradshaw, who has already been mentioned today, found that child poverty increased nearly threefold in the 1980s alone

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and that the well-being of British children compared unfavourably with that of children in most developed nations. That was the reason the Labour Government acted. It was also the reason why, by the time of the last election, there was apparently cross-party support for that goal of tackling child poverty in Britain. We are now in the position of having to ask what it means for the Government to say that they will maintain the goal of ending child poverty in the UK by 2020.

This is perhaps a philosophical point, but what does it mean to have a goal if one takes no steps towards it? I may say that I have a goal of being a concert pianist, but if I do not take lessons to learn to play the piano and I never practise, no matter how many times I say it, the odds of my becoming a concert pianist must be seen to be slim. In that case, on what basis can Ministers say they are committed to eradicating child poverty in the UK if they keep bringing forward Bills that drive it ever higher? It may be time for them to come forward and say that they do not in fact have any intention of eradicating child poverty and perhaps never did.

The amendment really is for the Government’s own good. If they are committed to the goal of ending child poverty by 2020, they need to understand the impact of their policies on child poverty. Otherwise, they cannot possibly achieve that. If they are not committed to that goal, the nation has a right to know that and still to understand what the impact of these measures would be. That is all the amendment does. It requires the Secretary of State to tell Parliament and the nation what the effect would be of these measures before he implements them. What could be more reasonable than that? I beg to move.

Lord Kirkwood of Kirkhope: My Lords, I hope to make an even shorter contribution to this important debate. I agree that the amendment relating to child poverty is apposite and important. I want to confine myself to seeking further clarification from the Minister, if she has the information to hand. It would be to the Committee’s advantage if we knew more about what we can expect from the Social Mobility and Child Poverty Commission, because it relates directly to the substance of this amendment.

I was pleased that there was a recent change to the membership of the commission and that our very own noble Baroness, Lady Shephard of Northwold, has joined it. I am pleased about that because she is an experienced hand and I trust her judgment. I look forward to seeing the fruits of her work within that commission. It is important to us all. However, I was disappointed to learn recently that the first annual report of the Social Mobility and Child Poverty Commission is not now to be with us before 26 September this year. We were expecting it in May. I make that observation because it is a sign of drift, potentially. If I am wrong about that, I hope that I will be put right.

I was very uneasy about adding social mobility to child poverty. The original terms of reference of the 2010 Bill as put forward by the noble Lord, Lord McKenzie, were the correct ones. The Deputy Prime Minister, of whom I am a great fan, as I am sure people understand, was wrong. Social mobility is a

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different subject altogether. It is much longer term and in the short term, we are dealing with a situation that is more of an emergency than the aspiration of social mobility, which of course we all accept. We really need to understand what contribution to child poverty this commission will make. If the Front Bench can tell us anything about that in the course of this amendment, that would be very useful.