The worldwide credit crunch is hitting the economy and public finances in every country, and few families and businesses believe that they will be unaffected in any way. What families and businesses need is real help now. They want to know that investment is being made for the future to ensure that when the upturn comes the country will be stronger, more competitive and fairer.
Last Wednesday's Queen's Speech showed how the Government are acting now to help families and businesses through the downturn and how we are planning for the future. All that is in sharp contrast to the Opposition, with their do-nothing attitude and their "let the recession take its course". The measures we set out last week support the action we are taking now and they will put the right structures in place to ensure success in the future.
My Department has an important role to play in helping to create a fairer society and a more productive economy, through our support for research and innovation, for higher education and, crucially, for the skills that are vital to businesses in a downturn and in the future upturn. As was rightly said by the Time to Invest in Skills campaign, led by the UK Commission for Employment and Skills, the CBI and other business leaders, companies that do not train are two and a half times more likely to fail than those that do. We are making it easier for businesses to get the skills they need, quickly.
Over the next two years, small and medium-sized enterprises will be the focus of a £350 million increase in Train to Gain funding. By then the budget for Train to Gain will be more than £1 billion. We are relaxing Train to Gain rules to allow funding for bite-sized units for qualifications in subjects such as leadership, risk management and customer service—things we know that SMEs prefer and that are proven to bring quick benefits to business.
We are relaxing the rules to allow the staff of small and medium-sized enterprises free training at level 2, whether or not they have reached that level. We are investing more in funding for training at level 3.
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What small businesses want in the immediate term is access to credit and some of the assistance that the Chancellor announced in the pre-Budget report. Over the past few days, I and my office have been whirligigging around regional development agencies, banks and Business Links, trying to discover who actually has information about the Chancellor's announcements. The last response—today—was from London Business Link:
"As discussed, I do not have any substantial information on the new funding scheme for SMEs and will send you any information I receive from our research team."
Even though Business Link knew that the debate was taking place today, it could not tell Members how small businesses will be able to access the money announced by the Chancellor in the pre-Budget report.
The new loan guarantee schemes and the support for export credits and for capital investment announced in the pre-Budget report will be made available, and Business Link is the right place to go for details, although it is not entirely surprising that schemes announced only a fortnight ago are not in every case yet in place. However, the Government's action in taking those measures is in stark contrast to the attitude of Opposition Members who have criticised everything we have done and take the view that nothing can be done to help small businesses get through. As the schemes are brought in, Business Link will be the right place to go for information.
The optical electronics research and innovation centre, OpTIC, is in my constituency, so I welcome my right hon. Friend's announcements about research and development and the export trades. What will be their impact in a Welsh constituency?
A number of the functions of my Department, especially my responsibility for research budgets, are UK-wide and the investment we are maintaining in research is critical not just for England but for the whole country. Skills policy is a devolved responsibility so I cannot tell my hon. Friend that every single thing done in England will be mirrored, but we maintain close contact with all the devolved Administrations, including the Welsh Assembly. In those Administrations, people are looking at ways of meeting similar needs, so I urge him to raise the issue with the Assembly. I shall be happy to do so, too, if he feels that his constituency is not getting support that should be available.
May I go back to the point made by my hon. Friend Tony Baldry? The problem is that small and medium-sized businesses cannot get hold of the money and loans they need, because the £37 billion of taxpayers' money lent by the Government has been lent at an interest rate of about 12 per cent. That compares with only 5 per cent. in the United States or Germany. As long as the rate is 12 per cent., how can money possibly be handed down to the SMEs that are begging for money so that they can stay solvent?
If the Opposition had had their way over the past year we would not be discussing a banking system that existed at all to lend to SMEs. On every significant issue that came up over the past year, the Conservatives got it wrong. We made sure that the right investment was made and that there were the right loan guarantees to stabilise the banking system and prevent collapse. As the hon. Gentleman knows well, we are engaged in discussion with the banks about the detail of their lending policies, but they have made clear the obligations they accept about marketing and the availability of finance for small business. We are putting in place the extra measures announced by my right hon. Friend the Chancellor two weeks ago. That is a powerful set of messages. However, the hon. Gentleman is right: small businesses are crucial in the economy, which is why we are going to such lengths to ensure that we tackle all the problems. As they arise, we shall continue to bear down on the banks and the guarantee systems—whatever is necessary to make sure we get through this recession. It is the hallmark of the Government that we understand our responsibility not to walk away from families and businesses in hard times, but to tackle difficult issues and to keep coming back to issues that are not easy to solve at first sight. That is in stark contrast to what would have happened if the Opposition had been in power.
I was talking about the extra investment for SMEs that we will make through training. We can do that only because the Government have planned to invest in skills, unlike the Opposition, who have promised to cut— [ Interruption. ] Hon. Members should listen, because this will affect many of their constituents. The Conservatives have promised to cut Train to Gain spending by more than £1 billion. They have promised to deny 1 million employees the chance to obtain new skills, and to get on, every year. That is a big difference. We are planning to invest in skills. The Opposition are planning to cut investment in skills.
May I give some advice to Opposition Members who say that regional development agencies are not helping them? In the north-east, we were advised last week by One North East that a transition loan fund is being set up, as well as a small business finance scheme and a capital loan fund. Opposition Members might consider ringing 0845 600 9006 and talking to One North East—they might get the advice they obviously need for their people.
I am grateful to my hon. Friend, who has clearly talked to his local regional development agency and so knows what immediate steps are being taken. The same is often the case with other regional development agencies. His RDA is providing some interim support before the national schemes are fully available across the country.
To counter some of the doom and gloom emanating from the Opposition Benches, may I inform my right hon. Friend of a company that I visited in Tipton a couple of weeks ago, called Carrs Tool Steels? It has just invested in a new milling machine, with the aid of a grant from Advantage West Midlands—the RDA—and the backing of a local bank. That machine will increase its productivity twelvefold; it is the only such machine in the country. It will have a remarkable impact on the company's future prospects. I ask him to make sure that such funding from regional development agencies, and the work that RDAs do with local financial institutions, is maintained. The situation is a contrast to what would happen if some of the policies promoted by the Opposition were put in place.
My hon. Friend is right to raise that example, and to pay tribute to the work that has been done by successful entrepreneurs and regional development agencies. The co-operation between the two has resulted in the development and growth of many successful companies. I agree with him that although times are challenging, the way in which the Conservative party always seeks to run the country down is a challenge in itself, to say the least.
I would like to make a little progress, but I will take an intervention from the Chairman of the Innovation, Universities, Science and Skills Committee.
I am grateful to the Secretary of State. I want to ask him a positive question, to which I hope he will give a positive answer. Last Monday—a week ago today—a number of right hon. and hon. Members visited the Honda Formula 1 team. [Interruption.] No, it was not my fault. We are talking about an innovative company with cutting-edge technologies that drives forward new products at a level that is probably not seen anywhere outside that very exciting area. What will the Secretary of State offer companies such as the Honda Formula 1 operation, through the Queen's Speech, so that we retain those businesses, skills, and innovative practices in the UK?
The important thing is that we maintain our investment in science and research, continue to develop organisations such as the Technology Strategy Board, and continue to recognise those parts of the economy in which we have a particular strategic strength and advantage. That means working with those areas of the economy, whether through investment in innovation and research, or through the development of skills.
So far as Formula 1 is concerned, it is well recognised that there is a triangle of particular expertise in this country, which goes beyond any one particular race team. It has specialist companies within it, and it has links to wider manufacturers. The hon. Gentleman asked me to look at what is happening in the Formula 1 industry, and I am more than happy to do so, but I am quite clear that our commitment to investment in research and innovation lies at the heart of creating the conditions in which such activity can continue.
Train to Gain is not the only issue on which the Government have listened to business. As everyone will have heard, business said that it found the skills landscape too complex, so we are implementing the simplification proposals of the UK Commission for Employment and Skills. We are merging the Train to Gain brokerage service with Business Link. Employers asked us to cut bureaucracy in apprenticeships, and we did. They asked us to ensure that high-quality employer training could be accredited, and we did.
We know that as we respond to the downturn, we need to make further changes. We have already announced additional funding from the European social fund to support skills advice and training for those who lose their jobs, or fear that they may do so. I want to ensure that more of the £5 billion annual investment in further education and skills helps people to get back into work. I want more people to get support before redundancies occur or short-term contracts come to an end.
Where a business moves on to short-time working, there will be more scope to offer free, short-term and intensive training for employees. I would urge any company, large or small, that is considering short-time working to follow the example of Nissan and JCB, and to talk to their local further education college or the Learning and Skills Council about what training they can offer their staff during that down-time. When redundancies or the shedding of contract labour is pre-announced, colleges and training providers need more flexibility to provide training support before jobs are lost.
The changes underline why further change to the organisation of the skills system is needed as we move towards greater responsiveness to employers, greater flexibility in the skills system and greater flexibility for providers. Under the Conservative party, post-16 education and training was a disaster. The Conservatives rightly gave colleges independent incorporated status, but then denied them funding and support. By 1997, in the confusion created by the training and enterprise councils, FE spending had been cut in real terms in the previous four years. There was no capital budget. The National Audit Office said that some FE buildings were not fit for purpose, and only half the people who started a course completed it.
The establishment of the Learning and Skills Council enabled the Labour Government to transform the scene. Completion rates are now 80 per cent., and that work is concentrated on the most useful qualifications. Investment in skills has risen by 50 per cent., and we are halfway through a £4.3 billion capital programme. The success of the LSC means that we can change to meet changing challenges. In 16-to-19 education, the challenges are securing proper, coherent planning of the curriculum; raising the participation age, which the Conservative party opposes; and taking clear responsibility to further reduce the number of those not in education, employment or training.
Will the Secretary of State please comment on the Government's performance in relation to education in prisons? I know that that is partly his remit, and partly that of the Secretary of State for Justice. There are large gaps in the provision of education within secure training centres, young offender institutions and the adult prison estate. I am afraid that the position is not getting any better as a result of the reforms that the Government are engineering this autumn and winter.
The hon. and learned Gentleman raises an important point. The Public Accounts Committee reported on the issue recently, but with respect, it did not say that things were getting no better; it recognised the £151 million of investment in offender learning and some significant achievements. However, there is no doubt that there are further improvements still to be made, particularly when it comes to ensuring continuity of training for prisoners who move around within the prison estate. The Government deserve credit for the investment that we have made. It was a good move to shift responsibility to professional educators and away from the Prison Service. The remaining issues have been properly identified, and we need to work to tackle them. However, progress has been made on that important issue.
On adult skills, we need a slimmer, more flexible, more responsive system; the new skills funding agency will provide that. Through the children, skills and learning Bill, we will legislate to create the new SFA, to deliver better help, and to deliver a system that will better build the right skills for the future. The SFA will be designed to be flexible, and highly responsive to employer needs and the changing economic demands of the country. Central to the new system will be the way in which funding will follow the choices of learners much more closely. The SFA will focus on results rather than processes, allowing colleges and providers to be more innovative and entrepreneurial.
The SFA will have responsibility for funding Train to Gain and for ensuring that providers are properly accredited. It will house the new national apprenticeships service as well as the adult advancement and careers service, which will offer further support and information for employers and for people who want to get on in their lives.
I want to catch my right hon. Friend while he is on the subject of apprenticeships. What the Government have done to support, build and grow the number of apprenticeships is fantastic. It makes a huge difference in all our constituencies, and to the young people concerned; I am sure that we all meet them when we hand them their certificates. I welcome giving suitably qualified young people a legal right to an apprenticeship, but there is a lot to do to ensure that they get the appropriate information, advice and guidance while at school. I seek my right hon. Friend's reassurance that, when we take those welcome measures forward in the Bill, we will make sure that advice and guidance are given at an early stage.
I am grateful to my hon. Friend. The issue of information, advice and guidance is actively being discussed by my Department and the Department for Children, Schools and Families. As a London MP, she will know that we have a London apprenticeship taskforce, which looks to increase the number of apprenticeship places in the capital; for historical reasons, the number there is significantly below the average in the rest of the country.
If I may, I shall make a little more progress.
The Opposition have not learned anything from their time in office. Recently, at the Association of Colleges conference, Mr. Willetts was asked about the capital programme for further education colleges, and he said that
"given the economic circumstances, we cannot commit ourselves to public spending plans in total for 2010 and beyond".
The Government are bringing forward the FE college building programme to boost the economy, but the Opposition plan to cut it.
On apprenticeships, because of the downturn, some employers unfortunately may provide less training. Apprenticeship placements are difficult to obtain, so will my right hon. Friend look at providing expanded apprenticeships in the public sector, particularly the NHS and local authorities, similar to those that we used to have under the National Coal Board, for example, which would take on excess apprentices, knowing that some of them would leak out to the private sector on the completion of their training. However, that did not matter, because it was a nationalised industry, and it was simply a different way of providing apprenticeship training for young people. We need to look at doing more of that with the NHS and local authorities.
I apologise for being late for the debate, as I was attending a meeting. What is the Secretary of State doing to ensure that the education maintenance allowance goes to those young people who need it, to encourage them to take advantage of the greater participation that the Government have made available?
That is an important point. The hon. Gentleman will know that we have had to change the contractor supplying that service, and it is working hard to clear up the backlog and ensure that those young people receive their EMA. The allowance has been a considerable success in encouraging young people to stay in further education and training. Again, in contrast to the Opposition, we are committed to that. I am sorry, this is becoming a little routine, but people who say that there is nothing to choose between the two parties need to pay slightly more attention to the differences between us in the areas that we are debating. I was about to move on to higher education, in which we have made a significant investment. The Opposition, however, have tended to indicate that they want to return to the unfunded expansion of higher education. I remind the House of what Lord Patten recently told The Guardian about higher education policy when his party was in power. He said that
"we expanded higher education hugely by reducing the investment in each student. The Treasury calls that higher productivity—it's a euphemism for poorer pay, degraded facilities, less money to support the teaching of each student".
We have been warned.
May I just rewind my right hon. Friend's comments? Is he aware of many people's concern that the targeting of FE funding militates against the provision of return-to-learning courses which are crucial, for example, to women who have spent time outside the work force? What will the Queen's Speech proposals do to provide that stepping stone before those groups can take more formal qualifications, particularly in the light of the economic situation?
The development of the skills funding agency will give us a more flexible vehicle for delivering policies that we have already announced. Earlier in the autumn, in setting out the priorities for skills funding, I was able to say that we wanted greater flexibility for colleges to deliver courses below level 2. We will introduce further flexibilities in Train to Gain for those with older qualifications that need to be refreshed. While the Queen's Speech is essentially about structure, we are moving the skills funding system towards greater flexibility, which brings greater professional autonomy to college managers. That is a process that will develop over time, but I am sure that it will help to tackle the important problem that my hon. Friend identified and which we need to address.
Our investment in higher education is not only a sound investment for the future but it enables universities and higher education institutions to offer immediate and practical help to businesses and individuals in the downturn. I commend to the House the document produced last week by Universities UK, GuildHE and the Higher Education Funding Council. It gave a business contact for every single higher education institution, and it set out the practical support available from our universities.
The ProfitNet programme introduced by the university of Brighton brings together 500 companies across Sussex, and it has helped create supply chains, new processes and joint ventures. The business evolution service provided by the university of Staffordshire supports skills development and training at different levels, depending on employer requirements. Changes to the rate of VAT mean that universities, like other registered charities, will benefit financially for the 13 months in which the lower rate remains in force. Both Brighton and Staffordshire universities have said that the VAT cut will help them to step up their efforts on behalf of their local communities, and I very much welcome that.
As the Secretary of State knows, I gave him advance notice that in our debate on universities I hoped that he would take the opportunity to tell the House authoritatively how many students in 2009-10 will have a lower maintenance grant entitlement than in the current year, 2008-09. We have been trying for weeks to get that elementary fact out of the Secretary of State, so will he take the opportunity to give the House that figure?
The figures that count are as follows. Compared with the announcements that I made in July 2007, we will invest a further £100 million in student financial support. Two thirds of students will get a full or partial grant. The percentage of students getting a full grant will not be the third of students that I anticipated, but 40 per cent. All students will receive more grant than they would have done in 2007 up to the threshold of £50,000 a year of household income and, in the same range, all will receive more total support than they would have had in 2007. That is a demonstration of our commitment to improve the student finance system. It is quite true that we have had to make adjustments and that some people who would have received some grant will not do so in the next year, but we have been straightforward in our commitment to deliver two thirds of students receiving a full or partial grant, which we believe we will achieve next year.
Whether people lack basic skills, or have high level skills which need to be refreshed, everyone from time to time needs to improve and update their skills and education. That is why we will bring in a new right for those in employment to request time to train—a new right for about 25 million people across Great Britain—and I am pleased that the devolved Administrations in Scotland and Wales have indicated support for similar measures. That new right will encourage a discussion between individual employers about skills development. A key requirement is that training should help improve business performance and productivity in the organisation concerned.
Before my right hon. Friend moves on, it would be characteristic of him to remember that international students come to these islands, and that our educational institutions are a magnet for them. They go back home, and take the message with them, which is a very important way of developing relationships with developing countries and so on. They come here because of the quality of education, which is superb.
My hon. Friend is absolutely right. The overseas students who come to study here are not only welcome but are an important part of our education system. They enrich the institutions to which they come to study. It is fundamentally the investment that we have made as a Government in higher education that enables that to be true, and we need to maintain our commitment to proper investment in higher education and not repeat the mistakes that were made in the not-too-distant past but which too many people appear to have forgotten.
Most businesses regard investment in training as investment in their own productivity. Employers spend £38 billion a year on training, which is many times more than the Government themselves spend, so time to train goes with the grain of what good businesses already do. I believe that asking for time to train will often become part of an employee's annual review process, and it will help to instil a culture of learning in every workplace. Apprenticeships, too, are an important way of unlocking talent and building skills in the work force. Ten years ago, apprenticeships were close to collapse. Only 75,000 people started them, and most of them did not finish. We as a Government have rescued apprenticeships. Last year, about 180,000 people started apprenticeships, and we are on target for 130,000 completions a year by 2010-11. Apprenticeships are back. Expanding the number of apprenticeships will help the economy to emerge from the recession stronger.
The children, skills and learning Bill will give all suitably qualified young people a legal right to an apprenticeship from 2013, and it underlines our commitment to entitle young people who have the ability and desire to take an apprenticeship to do so. The Bill will strengthen apprenticeships by establishing a coherent legal framework that will define the programme and set the standard. We believe that fulfilling our apprenticeship commitments will lead to around one in five young people starting an apprenticeship, with further growth for older workers, too. To support this entitlement, we will, through the Bill, establish a new national apprenticeship service, which was called for a couple of years ago by the Lords Select Committee. For the first time ever, we will have a dedicated service for apprenticeships.
Investment in apprenticeships will rise to more than £1 billion next year, but we need to take further measures. As my hon. Friend Rob Marris said earlier, we need a big drive to increase the number of apprenticeships offered in the public sector. We have already set targets for central Whitehall Departments. Radical new models of supporting apprenticeships, such as the London Apprenticeship Company, a community partnership including the City of Westminster college and Westminster Kingsway college, are being considered. That partnership intends to recruit apprentices who will be made available as a flexible work force to employers and other host companies. We have also set up a matching service for construction apprentices whose employers cannot keep them on, to place them in new employment and training. We are looking at developing a similar service in other sectors.
The Government need to use the leverage of public procurement. When we use taxpayers' money to build a new college, school or hospital, we do not want just to create new buildings. We want to help build the skills base of the construction industry. Following the announcement in the pre-Budget report, whenever Departments and their agencies let new construction contracts, they are now encouraged to consider making it a requirement that the successful contractors have apprentices as a proportion of the project work force. All successful contractors in Building Colleges for the Future, worth £2.3 billion, are now required to have a formal training plan for the project work force and provide access to apprenticeship places. We will build on this approach in other sectors, hopefully including IT, where Government will spend nearly £14 billion this year.
The Department for Communities and Local Government is also taking action on construction. The Local Democracy, Economic Development and Construction Bill will strengthen local democracy, promote regional and local economic development, and ensure fairness in construction contracts. It will improve current legislation on commercial contracts to provide a fairer system, and more cash flow for construction companies. The legislation will be especially important for small and medium-sized enterprises, which play a key role in local economies. The Bill will transfer greater power and responsibility to regions, local authorities and citizens in times of economic hardship. It is important that decisions can be taken by those who are closest to the issues, and the Bill contains important measures to encourage a more diverse range of people to take up civic positions, strengthening local democracy. The Under-Secretary of State for Communities and Local Government, my hon. Friend Mr. Wright, will address many of those topics in more detail when he winds up the debate.
As I said at the outset, the Government are determined to do whatever is necessary to support families and businesses through the downturn, and to ensure that we invest properly and wisely now for the upturn so that this country comes through stronger, fairer and more competitive—
I thank the Secretary of State for giving way. It is very generous of him. Will he answer the question posed by my hon. Friend Mr. Willetts earlier? How many students will be worse off as a result of changes to maintenance grants? We would like to know that before he finishes.
The hon. Gentleman knows, if he has been listening, that we will invest £100 million a year more than we planned when we announced changes in 2007. Also, significantly more students—we think 40 per cent. rather than 33 per cent. of students—will get the full grant, and all students will receive more grant, up to £50,000 a year household income, than they would have received in 2007. The Opposition should recognise the significant improvement that has taken place in the grants system, compared with that which existed just a few years ago.
I know that others wish to speak in the debate—
The measures that the Government announced in the legislative programme in the Queen's Speech and the measures that they support are in stark contrast with the message that we have had so often in the past few weeks that nothing can be done to help families and businesses at the time that they need Government most.
Members in all parts of the House who have an interest in skills and training and housing have had an unusual number of changes to the timing of the debate. We all understood the passions of the House on the very different matter that we have just debated. The present debate was originally planned for Thursday, and we are at last having it now, until 11 pm. One of the compensations of holding the debate today is that my hon. Friend Mr. Hayes was not able to join us on the Front Bench on Thursday. He had a commitment to take part in the Moulton village pantomime in his constituency, "Flinderella", in the starring role of Baron of Boston. We are grateful that he is able to join us after his theatrical triumph last week.
Contrary to the extraordinary straw man so savagely attacked time after time by the Secretary of State, the Opposition fully understand the scale of the crisis facing our country as the economy heads into recession, and we fully understand the need for serious measures to tackle the crisis. The first thing to do is recognise what is going wrong with skills and training in our country. The Secretary of State was far too complacent about that. He spoke, as he so often does, of the extraordinary success in the number of apprenticeships, but the number at level 3—which is what apprenticeships are in many advanced western countries, not level 2; advanced apprenticeships, as they are now called—has been falling in each of the past seven years. The number has fallen from 112,00 to 110,000 to 105,000 and in 2006-07 it was down to 97,000. The Secretary of State failed to engage with the problem that there is a decline in the number of level 3 apprenticeships, compensated for only by an increase in the number of level 2 apprenticeships, which would not even have been called apprenticeships in the past.
Does the hon. Gentleman accept that what really matters is the number of people who complete their apprenticeship, and does he accept that the number of people completing a level 3 apprenticeship has at least doubled?
We are talking about the Government's figures for the number of advanced apprentices in training, and that number is going down. The Secretary of State has renamed what in the past were youth training schemes and the youth opportunities programme. They are now called apprenticeships instead, so that he can claim a higher figure. We are entitled to draw attention to the problem with level 3 apprenticeships.
There is also an increase in the number of young people not in education, employment or training. After 10 years of economic growth and billions of pounds spent on the new deal, the number is up by 132,000 compared with five years ago. So we have a decline in the number of advanced apprenticeships, an increase in the number of young NEETs, and for older learners in the past few years we have had a loss of no fewer than 1.4 million adult learning places. Mature workers losing their jobs and perhaps thinking of retraining and taking up a new career need to be able to access those adult learning places.
We have a crisis in our training provision that matches the growing crisis in our economy. Instead of addressing that, the Secretary of State painted a caricature picture of what the Opposition stand for. As for the proposals in the programme put before the House in the Gracious Speech, most of the proposals in the children, skills and learning Bill are simple reorganisation, or to be more accurate, re-disorganisation—yet more change in a skills system that has already seen an enormous amount of change in the past 10 years.
It is worth recording that the Secretary of State praised the achievement of the Learning and Skills Council, which the Government created in 2001, and which they are to abolish. Having created it in 2001 with 47 local learning and skills council branches, they reorganised it in 2003 at a cost of £53 million. In 2005 they reorganised it again at a cost of £35 million. In 2007 they passed the Further Education and Training Act 2007, which formally replaced the 47 local branches with nine regional centres, and now another year on, there is to be legislation abolishing the LSC entirely and replacing it with three other quangos. This is endless reorganisation in the absence of a real strategy for improving the level of skills in our country.
If the Secretary of State will not take it from the Conservatives, he might accept it from someone for whom I suspect both he and I have considerable respect—Chris Humphries, the chief executive of the Commission for Employment and Skills, who produced a report that the Secretary of State himself cited. Chris Humphries said:
"I don't think there is an employer in the land who understands what the new systems are".
When asked by the Financial Times how many skills bodies there were in Britain, Mr. Humphries, one of our leading experts on skills, said:
"Honestly, I haven't got the foggiest idea", but he estimated that there were "many hundreds". Instead of a skills policy, the Government have created an extraordinarily complicated structure that they expect employers and individual learners to navigate in order to access the training that they need, especially in tough times. What we desperately need is simplification; instead, the LSC is being replaced by a multiplicity of other bodies—a skills funding agency, a national apprenticeship service and a young people's learning agency—and there is a new role for local authorities.
The Secretary of State praised incorporation—the new freedoms that we gave to further education colleges in 1992—and I was pleased to hear him do that. I sat on the new corporate body of Havant college for six years and I know how much FE colleges appreciated the new freedoms that we gave them. However, his changes will take away those freedoms by once more putting FE colleges under the control of local authorities, which is not what they want and is not in their interests. What we therefore have from the Secretary of State is a reversal of the changes that he himself praised in his own speech.
What we believe in doing—our approach—is having more training and investment in skills by enabling FE colleges once more to serve their local communities and their local employers as genuine community colleges that are responsive to local employers and stakeholders. That is the right approach, and we believe in a simple funding structure with a body such as the further education funding council allocating funding: a single body allocating funding to FE colleges, not the multiplicity of different local authorities that they will have to deal with—and that is simply for the money going to 16 to 18-year-olds.
When the Secretary of State produced his White Paper earlier this year, he estimated that some FE colleges could be taking students from an area covering 100 different local authorities. That remark was made in his own document. How on earth are they supposed to access funding from so many different agencies? It is going to be a bureaucratic nightmare, and once again it will fall to the Conservatives to sweep away the complexity and bureaucracy and give FE colleges the straightforward, simple funding arrangements that they wish for. [ Interruption. ] The Secretary of State seems to doubt what I said about 100 local authorities; let me find what he said in his own document, "Raising Expectations". He said:
"Colleges in particular can draw from a very wide area—sometimes from over 100 local authorities."
If so, that is why the new funding arrangements will be such a nightmare for them.
I believe that the only reason why the Government are embarking on all this reorganisation is that they accept privately that the Learning and Skills Council and the endless reorganisations have not worked and that their system has failed to deliver. The same is true of their proposals for "time to train", which reflect the failure of Train to Gain. The latter was supposed to achieve results by rewards and incentives and has failed to do so. The Ofsted report, "The impact of Train to Gain on skills in employment", was, it must be said, one of the most critical reports that it has produced on any aspect of our education system. It said of Train to Gain, on which the Government are supposed to be spending more than £1 billion, that
"the survey found little evidence that the programme was driving up the demand for training among employers."
It was clearly failing.
The Ofsted report says the following about the job brokerage service, on which so much of the budget goes:
"On the evidence of the provision surveyed, the brokerage service had a minimal impact on the number of employees starting a Train to Gain programme, or on the number of genuinely 'hard to reach' employers that were participating."
This is Ofsted telling us that Train to Gain has not been working. As a result, there is a serious underspend on Train to Gain. We are proposing not to abolish it but to refocus its budget on what we believe is a priority, especially in these tough times: more funding for apprenticeships, which is the single best thing that we can do to strengthen the skills and training opportunities in our country.
Train to Gain is failing and instead we will have "time to train". We do not oppose the idea of a right for employees to seek the opportunity for more training and we hope that it will succeed, but the Secretary of State must surely accept that concerns are expressed in the documents that his own Department has produced to go alongside the Bill.
Another fact that the Secretary of State conveniently left out is that the apprenticeship schemes are paid for in full for 16 to 18-year-olds, but as soon as someone reaches 19, the money is split in half, thereby dissuading a lot of people from continuing apprenticeships over the age of 18.
My hon. Friend is right and, contrary to the caricature painted by the Secretary of State, one of our many proposals is to refocus Train to Gain on supporting apprenticeships by ensuring that that completely unacceptable age discrimination is abolished. No longer will people get full funding for an apprenticeship only if they are under 19 and receive 50 per cent. funding after that. We believe—especially in tough times, when there will be people over 19 who, sadly, will lose their jobs, seek a new career or try to get training—that using the Train to Gain budget to support them in their apprenticeship is the single best thing that we could be doing. It is a great pity that the Secretary of State presides over a system that is so clearly biased against anyone over the age 19.
We hope that the proposals for "time to train" will work, but the Secretary of State will doubtless be aware of the comments of the CBI, for example, which is concerned that the impact of "time to train" on employers
"would have to be carefully monitored given the large number of employees who will be eligible to submit requests."
It would be very useful to hear from the Secretary of State about something that he did not cover in his speech: the steps that he will be taking to ensure that employers are not overburdened as a result of the new right that he is proposing to implement. Surely, as a minimum, he needs to make a commitment to this House that he will monitor the effectiveness of this new right, to ensure that it is not coming with a disproportionate burden for employers.
On apprenticeships, we also need to be confident that we can do far better than the Government have done. Their approach in the Queen's Speech has been not to do anything real to encourage apprenticeships, but instead to pass new legal rights. Again, we do not have a problem with people having a legal right to an apprenticeship, but legal rights is not the crucial issue—any more than passing legislation with a commitment to abolishing child poverty by 2020 will, of itself, miraculously solve the problems of poverty. In fact, there seems to be a pattern in this Queen's Speech, whereby the Government pass law requiring virtue and forbidding vice in all the areas where they seem to be making least progress in the real world in achieving their objectives. A report today shows how badly the Government are doing on child poverty, and we are invited to support the aim of abolishing it by 2020. We have clear evidence that they are doing badly on apprenticeships, and we are invited to support a new legal right for an apprenticeship, without any clear evidence of how it is to be achieved.
This seems extremely odd, and I should be grateful if the Secretary of State helped us on this issue. In the draft Apprenticeships Bill—of course, we have yet to see the new combined legislation—there was a proposal that, in order to be an apprentice, one had genuinely to be employed. We Conservatives had been pressing for that, because we think that for most people, an apprenticeship means that they are in employment and receiving training in addition. A lot of damage is done to the brand if large numbers of other training schemes that are not linked to employment in any way can be called apprenticeships. The proposal in the Bill was that any apprenticeship had to be linked to employment. However, we understand that in addition the new legislation will include an entitlement for every young person to have an apprenticeship. If to be in an apprenticeship a person has to be in employment, and if we are passing a law giving everyone an entitlement to an apprenticeship, we will be interested to hear how the Secretary of State believes that the entitlement will be delivered. Ultimately, we are in a free economy in which employers cannot be required by law to take on an apprentice—although, of course, we want many more employers to do so.
I can help the hon. Gentleman with the inquiry, with reference to what the Secretary of State set out in his speech. There are two ways in which the entitlement can be delivered. One is through the public sector and the other is through contract compliance.
I am pleased with what the hon. Gentleman has said about the public sector. As he will be aware, in the past year I have tabled many questions trying to identify how many apprenticeships there are across the public sector and in central Government. The figure for the Government was shockingly low: there are 3,431 apprenticeships in central Government—a very tiny figure, especially if we take seriously the extraordinary figures for the total number of apprenticeships that we heard from the Secretary of State earlier. There seem to be 2,581 advanced apprenticeships, which are the only sort of apprenticeship in most other countries. Given that currently there are only around 3,000 apprenticeships across Government, it would be an extraordinary ambition for the public sector to deliver that entitlement, which will apparently be offered to all young people.
I admire the ambition of Rob Marris, and I hope that we will hear from the Government—we have not this evening; we are still waiting—about what practical measures they will take to achieve the targets. How will they explain the idea that people can have an entitlement to be employed?
I shall not repeat the various measures that I set out in my speech. The House will note that the Conservative party has opposed them—particularly the establishment of a dedicated apprenticeship service, which has been recommended as the key necessary organisational focus by a Committee in another place. However, I am perfectly happy to confirm that our view is that an apprenticeship must have a clear link with employment in the workplace. We said that in the apprenticeships review last year, and our intention is that the Bill will define that key characteristic of the apprenticeship.
We accept the challenge involved in meeting the obligation that the young people with the ability, qualification and desire for an apprenticeship should be able to have one. The difference between the Government and the Conservative party is that we believe that it is right to go for such challenges—to set ourselves the target and have the determination to achieve it. We heard again from the hon. Gentleman the voice of despair—"Nothing can be done."
The Secretary of State should understand that we are talking about genuine concerns raised by people in many areas of the British economy about how apprenticeship schemes are developing. I shall quote the House of Lords Committee, which he cited earlier:
"Apprenticeship schemes have suffered from too much emphasis on quantity over quality. Completion rates for advanced apprenticeships remain unacceptably low. Progression through the different levels of apprenticeship and on to higher education also needs to be greatly improved."
We want to do better; that is why we have said that we will cut the bureaucratic burdens on employers that currently deter them from taking on apprenticeships. We have said that we will encourage small businesses in particular to take on more apprentices by having more group training associations. We have said that apprenticeships should be a route into higher education and university for young people, who should benefit from them. That is why we have proposed both apprenticeship scholarships—to enable apprentices to go on to university—and the ending of age discrimination in access to apprenticeships.
We want more real apprenticeships. We do not believe that the Secretary of State has credibly explained how the two requirements to be imposed by the legislation—that apprentices have to be employed and that people have a legal right to be an apprentice—can be reconciled in the real world. He has still not explained that puzzle to us.
The backbone of apprenticeship provision in the past was the large-scale public sector organisations and large-scale manufacturing industry; as a Government, the hon. Gentleman's party did more than any Government in history to destroy both. Does he not agree that starting to re-establish direct, large-scale employment in the public sector would help provide apprenticeships?
I absolutely wish to see more apprenticeships across the public sector. One of the reasons why I tabled the parliamentary questions that showed how few apprenticeships there were across central Government was to try to get the Government to do something about the scandal of how low that level is.
Let me repeat again for the benefit of the Secretary of State and Kelvin Hopkins that we want more people of all ages to be in apprenticeships. We have practical proposals to increase the number of people in apprenticeships; what we have from the Secretary of State is rhetoric without any explanation of how he will achieve the ambitious targets and legal requirements that he proposes. That is the history of his party's approach to apprenticeships—an endless stream of ambitious targets, none of which is ever met. They are not met because the Government have not made the practical proposals that we have made to ensure that they are spread. That is the problem that the Secretary of State's proposals face.
I turn briefly to the subject of universities, about which the Secretary of State spoke. The Government have failed to achieve their apprenticeship targets, the Learning and Skills Council has failed and Train to Gain has failed. On top of all that, this is the last Session before the Government face the truth of their failure to achieve their target for university participation, which, we should recall, was that 50 per cent. of young people should participate in university education by 2010.
It is. Like the Secretary of State, I had the excitement of being at the event in central London on the morning when the large hadron collider was turned on. I much regret the fact that, shortly after, it was turned off; we hope that it will eventually be turned on again. The reasons for the malfunctioning of the large hadron collider merit a debate in their own right. I was concerned when one of the scientists at the opening of the collider said that one problem had been that one of the people constructing it appeared to have left a can of lager in the central tube, and that that had distorted the signal. Whatever the reason, we believe in those projects, which are an important part of the scientific research carried out in our nation. That is why the former Prime Minister, Baroness Thatcher, was so right to take the decision that we should back that programme.
I turn back to the subject of universities. The Government target was that 50 per cent. of young people should go to university by 2010. Progress towards achieving that target has barely moved upwards since it was set; the figure has been stuck at about 40 per cent. for the past seven years, and between 2005 and 2006 it actually fell. That is another example of the phenomenon of the Government announcing an ambitious target and failing to meet it. I suppose that we should be relieved that at least they did not propose a law that said that everybody should have an absolute entitlement to go to university, even as the Government moved further and further away from their target.
There are many reasons for the Government's failure to achieve the target. As the Secretary of State knows, one of my particular concerns is the extraordinary gap that has opened up between male and female participation in higher education. It is great that 45 per cent. of young women now go to university, but the fact that only 35 per cent. of young men do so tells us that our education system has a serious problem of male under-achievement.
The Secretary of State disappointed me when the only factual question that we asked in this Chamber about his proposals on maintenance grant, which was repeated so skilfully by my hon. Friend John Howell, did not get a straightforward answer. It is a very simple question. I have to ask Labour Members this: do they believe that if the answer was in any way encouraging it is possible that we might have heard it instead of the endless evasions and contortions of the Secretary of State? I wrote to him in advance, trying to explain that I would be grateful to receive an answer on behalf of many tens of thousands of families.
In 2007, one of the first acts of the new Prime Minister and the new Secretary of State was to announce a new regime for maintenance grant that applies in 2008. Only a month ago, the Secretary of State announced that he was changing the 2008 regime to apply a different regime for 2009, which will clearly be far less generous because many fewer students will get their maintenance grants than would have done had the 2008 regime continued. Universities will now have three different maintenance grant regimes for students who went up in 2007, in 2008 and in 2009. Only this Government could achieve that, but that is what we are going to have. Young people from tens of thousands of families who had already applied to university are entitled to know how they will be affected by these changes, and we are entitled to know how many fewer students will receive maintenance grant in 2009 than would have received it in 2008. Unlike the intervention by Bob Spink, this is not rocket science. It is a straightforward question: how many people, comparing the 2009 and 2008 regimes, will not be getting maintenance grant?
I thank the hon. Gentleman for giving way, although he may regret it. He said that only this Government—I share his criticism of what they have done—could have changed the student grant regimes in such a way. I was a student when the Conservative party was in power, when the grant was reduced every year and benefits were withdrawn. During my three years at university, the regime was different each year.
I am full of sympathy for the hon. Gentleman. The world has changed since then, and many more young people are going to university. We celebrate that fact. Of course, the number of young people going to university surged during the years when we were in government.
The hon. Gentleman's intervention was not as helpful as I had hoped, because he diverted me from my line of inquiry. Not only Conservative Members but families throughout the country are entitled to know how many fewer young people will get maintenance grant in 2009 than in 2008. We believe that about 40,000 students will no longer get any grant at all compared with the 2008 regime, but we also need to know how many will have a reduction in their grant but still get some of it. There are various estimates going around. We have tried to work it out with the limited resources of Opposition, using the information that is already publicly available. The Secretary of State set out the detail of how the taper is going to work, and we have the provisional figures for the Student Loans Company. It is possible that a further 80,000 students or more, adding up to 120,000 per year, will lose out compared with the previous regime, which over the three years as we get up to a full complement of students means that 360,000 students will lose maintenance grant compared with the 2008 regime.
If the number is as great as that, it is hard to see how it is possible that two thirds of students will still receive a grant. One of the things that surprised me about the Secretary of State's remarks was that he implied that he still believes that that will happen. On our calculations, that seems most unlikely—we believe that the proportion could be significantly lower under the new regime. Regardless of what one thinks about the announcement that the Government made in 2007 and the financial crisis that they have faced since, surely Members in all parts of the House are entitled to an answer to this simple question, which the Secretary of State seems to have a phobia about answering and has yet again failed to answer. Every time that happens, it confirms our suspicions that large numbers of families are losing out compared with the regime that he proudly announced in his first week as Secretary of State. We should all expect as a minimum that he comes clean on that.
What we have in the Government's proposals in the Queen's Speech is not reform but change—endless change on the previous structures that the Government themselves put in place. We have seen the failure to achieve more real apprenticeships linked to employers at level 3; the failure of Train to Gain, which should be refocused to provide more financial support for apprenticeships; and the failure to achieve the Government's targets for participation in higher education. That is why Conservative Members have no confidence in this Government's ability to achieve the improvement in skills, education and training that the country so clearly needs as we head into what could be a very severe recession.
Thank you for calling me to speak in this debate, Mr. Deputy Speaker. It is a pleasure to participate under your leadership.
I want to refer to two Bills in the Queen's Speech. I very much welcome the marine and coastal access Bill, which is long overdue. The former Select Committee on Science and Technology published an important report called "Investigating the Oceans", and I hope that some of its recommendations can be taken into account in that legislation. One of our strong recommendations, which the Government have so far rejected, was the establishment of a marine science agency to replace the Inter-Agency Committee on Marine Science and Technology, which does not have many powers and which, we felt, lacks a lot of clout. At the moment, marine policy, for example that on fisheries or shipping, is conducted in silos, but we felt that all marine policy should be pulled together under one controlling organisation. Looking at the report retrospectively, I still believe that, and I ask the Secretary of State and his Department to reconsider that recommendation.
The Innovation, Universities, Science and Skills Committee has scrutinised the draft apprenticeships Bill, and our report was published late last week. I hope that it will be helpful to Members who serve on the Public Bill Committee.
The speech by the shadow Secretary of State was extremely negative. Of course, his function is to try to attack the Labour Government, but I recall when I was in a university trying to teach—I say "trying" deliberately—under a Conservative Government, and it was jolly difficult. I have spoken about this before, and I do not want to labour the point again, but at that time there was a huge brain drain. It is right and proper that our new graduate and postgraduate students should go abroad for postgraduate and post-doctoral studies to find out what is going on in the rest of the world, but in the hope that many of them then bring back the new skills gained in other countries, particularly America, Japan and Germany, to apply them in this country. At that time, under a Conservative Government, the huge brain drain was one way. People went across the pond to America, largely, and stayed there; many of them are still there. It is good that under the Labour Government we have attracted a substantial number of them back again, and far fewer have joined the brain drain in that direction. In fact, it is nice to see Americans coming over and joining British research groups for a change, particularly in subjects such as stem cell research. Under the Tories, things got so bad that a membership organisation was established called Save British Science, and people joined it in overwhelming numbers and campaigned to try to do just that. However, the only thing that saved British science was a change of Government in 1997. That organisation, which changed its name under the Labour Government, is now called CASE—the Campaign for Science and Engineering—and is much less militant than it was under the Conservatives. Indeed, it gives helpful advice to the Labour Government.
That'll be the day, when they get Mr. Willis to vote Labour. I am still trying.
The best thing that has happened under the Labour Government is that the funding for science, and for STEM subjects—science, technology, engineering and maths—will have doubled in real terms by the end of the comprehensive spending review, taking inflation into account. That is a staggering success.
I recall that it was not that many months ago that we had a lively discussion about the future of business in the north-west, and I am enjoying listening to the hon. Gentleman's reminiscence about the Conservative Administration. Does he also recall that during the mid-1980s, there were more people on apprenticeships than there are today under a Labour Government?
I thank the hon. Gentleman for giving way; he is one of the most respected Members in this House. Could I drag him away from the negative to the positive, because I was a member of the Conservative team that did the things he describes in education, and in science in particular? Would he share with the House his ideas for enthusing children and for encouraging youngsters to get more involved in science and the STEM subjects today?
I am hoping to come to that later on in my speech, if the hon. Gentleman is still here.
Although the amount of science funding has doubled, in terms of the percentage of gross domestic product, the level of funding is still only half that spent in America. We have crept up closer to many of our European partners, but the Government need to spend even more money on research and development, particularly at a time when we are entering a recession. I believe that the Government have recognised that fact, and that they will introduce a further funding increase after the comprehensive spending review. We are now ahead of Japan in terms of metrics, which is an astonishing success. We are second in the world when it comes to innovation in our universities, however we measure it—be it the quality of publications, the number of publications or citations of publications. We are doing extremely well.
I want to refer briefly to the Select Committee on Innovation, Universities, Science and Skills. The word "science" is included in the name of the Committee, but, sadly, we have not yet got the Secretary of State to add it to the title of the Department, but we are still working on him. The former Select Committee on Science and Technology was able to carry out cross-cutting inquiries across agencies and Departments. We have had a debate on such inquiries before, and I shall not labour the point this evening, but we did some detailed work in that Committee under the two Chairmen in post when I was a member of it. However, the remit of the Select Committee on Innovation, Universities, Science and Skills is too broad because although there are many matters that we would like to investigate, for example, the regional development agencies and role of departmental chief scientific advisers, it is clear that we will not get round to them.
Whereas the Science and Technology Committee largely met on Wednesday mornings, and occasionally on Monday afternoons, the volume of work forces the DIUS Committee to meet on Wednesday mornings and regularly on Monday afternoons, which is putting extreme pressure on Committee members. Membership of the Committee includes those who represent the education side of the debate and those from the science and technology side, which causes tensions in the Committee. I still believe that a cross-cutting science and technology Select Committee would be better, and that education and skills would be better dealt with separately.
The excuse for not continuing with the Science and Technology Committee last year was that we could not stand the pressure of setting up another Select Committee. But we have just set up regional Select Committees, and we have set up another departmental Select Committee in the shape of the Select Committee on Energy and Climate Change. I favour a separate Department for Energy and Climate Change, but the work of Members has increased, and I cannot see why such an excuse was used last year when it was decided not to continue with the cross-cutting Science and Technology Committee.
On Friday, I was at the life sciences department of Manchester university. I am paired with a member of that university through the excellent Royal Society pairing scheme, as are many other hon. Friends and Members of the Opposition; it is an excellent scheme. When I went to the campus of the university, and cast my mind back to 1997 to compare and contrast with how things were, I found that there was no comparison. There are a large number of new buildings on the Manchester university site, and that is not just the case for that university, but for Durham, Hull and my university in Bolton. Every university has erected a tremendous number of new buildings, and carried out a lot of refurbishment of existing buildings, particularly the laboratories, which desperately needed refurbishing. We have had joint infrastructure fund money and science research investment fund money and that funding shows on a visit to a technology or science department in universities.
It is my impression that younger academics, and some of the middle-management academics, do not yet appreciate what I call the tectonic plate shifts that have occurred in our science, engineering and technology policy in the past 12 months or so. First, we have established three new institutes. In a good move, the Office for Strategic Co-ordination of Health Research has rightly brought together the research carried out by the Medical Research Council and the national health service. The Energy Technologies Institute was created for obvious reasons, and we now have the Technology Strategy Board because we have not been very good at translating our superb innovations into reality as products for export. I shall come back to that point shortly.
There has been a shift from the physical sciences towards the Medical Research Council and the Biotechnology and Biological Sciences Research Council, too, which some physical scientists are complaining about. The universities received the full economic costs of the research grants—FEC—and that is now at a level of 90 per cent, which is also welcome. Under the previous Administration, there was no money to support well-founded laboratories. When visiting laboratories today, I can see where the money has been invested. The Government have rightly created postgraduate training centres and set up six grand challenges on energy, living with environmental change, global threats to security, ageing, the digital economy and nanoscience through engineering to application.
All those extra creations have come into being during an 18-month period and, although extra money has been given to the science budget, unfortunately pressure has been put on programme grants and responsive mode grants. Members of the DIUS Committee have received a lot of criticism because young academics cannot get research grants to get their programmes off the ground. The only way to conduct research is either for them to do it with their own hands, or do what my generation did—work with a professor. That would not give those young academics much independence.
In the case of the Engineering and Physical Sciences Research Council, fewer than 10 per cent. of the alpha-funded grant bids are funded. The frustration can be felt; I felt it when going round Manchester university on Friday. I am going to Liverpool next week, and I visited Bolton university a few weeks ago. People have ideas, but they are really frustrated that they cannot get responsive mode funding from any of the research councils, except perhaps the Medical Research Council or the Biotechnology and Biological Sciences Research Council, to carry out that vital blue-sky research. We ignore such research at our peril, because the people doing the big programmes—such programmes are necessary and I support them—will have no young scientists if young scientists cannot start on independent research in universities that are perhaps not part of the Russell group.
I agree with my hon. Friend. I am a great supporter of pure science, in contradistinction to applied science, although sometimes they overlap, owing to the passage of time. Does he agree that a university should have significant research capabilities? Otherwise, it is simply a college—worth while as that is, a university without research is not a university. Does he also agree that in the next round of research funding allocations, the Government might want to consider pooling expertise among institutions, to enable them to have access to that research funding, even if they are not Russell group universities, such as the university of Wolverhampton, which is the most accessible mainstream university in the country that is not part of the Russell group?
I agree entirely with my hon. Friend.
What the Government are worried about—hon. Members in all parts of the Chamber should be worried, too—is this: if we double the amount of money from the Government, not to mention from industry, going into research and development, we would expect to see outcomes now, after 10 years of extra funding. I have warned the academics several times that the Government are looking for outcomes, but there is a problem. The innovation and the R and D in our universities are as good as any in the world. The big difficulty is getting the products through the spin-out companies, but we are doing better than ever on that. I have never seen so many spin-out companies, so many incubators and science parks dotted around our universities or so many clusters of companies feeding into them, but still we do not see the volume of outcomes that the Government perhaps expect.
However, the academics wanted me to remind the House today that it takes 10 or even up to 30 years for a brilliant invention such as DNA fingerprinting—that is just one example that flies off the top of my head—to become a reality that is useful for society. That cannot be done in 10 years, the academics tell me; it will take far longer than that. Perhaps we are therefore being over-anxious about that aspect of our work. The Sainsbury review, by Lord Sainsbury, flagged up those issues for us.
I am listening to the hon. Gentleman carefully and agree with much of what he says. Does he recognise that the problem is often not so much the fact that there are spin-out companies, but the difficulty that smaller companies face in getting the next stage of investment funding to bring their products closer to market? That is what high-tech and biotech companies in my constituency are saying. With the current squeeze on big pharma, smaller biotech companies are finding it much harder to get licensing agreements from pharmaceutical companies, which is part of the same problem of moving to the next stage.
I am glad that the hon. Gentleman mentions that, because if he had read the business supplement of The Observer yesterday, as I did, he would know that the Government have just put in place a fund of £1 billion in extra money to do exactly what he thinks should be done. The article said:
"The plan, conceived by the National Endowment for Science, Technology and the Arts (Nesta), was fleshed out in discussions at Downing Street" only last Thursday at which the noble Lords Drayson and Sainsbury were present. The announcement was made pretty soon after that. The scheme will mean the
"doubling of government funding for scientific research at universities, which has led to an increased number of spin-outs," as I have mentioned,
"in IT, biotech, nanotech and green technologies".
That must be good news. I do not know whether it has percolated through yet, but it means £1 billion of extra money. The difficulty, as the hon. Gentleman knows, is that there is a deep valley between innovation and product called death valley. The venture capitalists are not putting in the money necessary to get across that valley, but the money that the Government are putting in will help.
Like my hon. Friend Dr. Harris, I am listening carefully to the hon. Gentleman. Will he confirm that the money that was announced in The Observer, rather than in the House, was announced in The Observer because it is not new money at all? It is just existing money that has been recycled, unless the Secretary of State can contradict me.
I am sure that we will hear the truth of that argument when this debate is summed up. Nevertheless, £1 billion is going in to help turn our excellent inventions into useful products for society.
At long last we have a new President in America, thank goodness. President-elect Obama, who takes control on
Does my hon. Friend agree that there has been a brain drain into Canary Wharf, too? Many young scientists found that the financial industry was the place to go to get the money and the lives that they wanted; but now, with the financial industry suffering somewhat, there is a reversal of that process. People are beginning to teach and to bring science into schools, so out of a recession good things can happen.
My hon. Friend is right. In fact, one of our Ministers was telling me the other day that we have the best cohort of young teachers in training now that we have had in generations, which must be good for schools. We have excellent teachers in schools already, and when those in training replace the ones who will shortly retire, I am sure that we will continue to have excellent teaching in our schools.
Let me turn to another problem that I want to flag up, which has been raised by the Million+ think tank. Research and development funding is becoming more elite. Larger grants are going to smaller numbers of the more elite universities, which are largely in the Russell group. Million+ and others in the academic community are arguing—I refer to what my hon. Friend Rob Marris said about how universities should be doing research—that universities that are not in the top flight, namely the Russell group, are finding it more and more difficult to secure such funding. Million+ has recommended that a sum of money be set aside so that vital work that might not be of international standing, but which is certainly of national standing, can be done in those universities and has suggested a figure of around 10 per cent.
My right hon. Friend the Secretary of State seems to think that the Million+ group is asking for 10 per cent. to be creamed off the current quality-related funding, but it is not asking for that. Million+ has recognised that there have been substantial year-on-year increases in QR funding. It is asking whether 10 per cent. of those substantial increases, not 10 per cent. of the existing money, could be put into those universities that are not so fortunate in winning QR funding. Let me say straight away that Million+ does not want that money for non-quality work, but for quality work of national standing, instead of international standing.
My university—Bolton university—suffers in that respect. It used to do a lot of work with local industry. Local industry could pay for the contract work that it asked the university to do on its behalf, but if the research groups are not there, that research will not happen. I visited the fire materials group at Bolton university a few days ago. The fire materials group is a centre of excellence for research into flame-retardant materials, fires in households and other vital areas of that kind. Hon. Members will not find many other universities that are researching every aspect of fire in that way. Such specialist work is being undertaken in Wolverhampton, Chester and Bolton. We ignore it at our peril, because if neither industry nor and central Government fund it, those small specialist groups will disappear and we will be the losers, not the gainers.
My hon. Friend is very generous in giving way. The university of Wolverhampton is a large university and one of the top 10 in terms of numbers of students. However, the QR funding that it receives—its research is judged to be of national importance, not international importance—is some £200,000 a year. Fifteen miles down the road, the university of Birmingham—a smaller university, but a Russell group university—receives tens of millions of pounds a year. Wolverhampton university is not saying that we should take that money away from Birmingham; it is saying—and I agree—that the imbalance is a little too great.
Yet again, I entirely agree with my hon. Friend.
The Select Committee has recently returned from China and Japan, and I would like to refer to something that particularly impressed me. As I have already said, the Technology Strategy Board will hopefully transfer invention into useful products for society, but in Japan there was a different model that we looked at. It was called an innovation hub, but its authentic title is the National Institute of Advanced Industrial Science and Technology—AIST for short. I have not seen anything quite like it anywhere else in the world. For example, Japan's large electronic companies—we all know the names from our Sanyo or Toshiba televisions and so forth—all come together in this institute after a new invention has been made that might benefit the whole world, not just Japanese society. The companies put in their own money to supplement the Japanese Government money in order to explore the new invention and find out whether it may result in any commercial products. At the point when these companies believe that some commercial products can be developed, they of course break out of this institute and go back to their own research bodies, subsequently using the research that they all pooled together in order to bring commercial products forward for the market. I say to the Secretary of State that I think that that model is really worth looking into, especially if he has not come across it before.
My final plea is not to prevent international students from coming to Britain. Apparently, we have backed out of the European blue card scheme in order to bring in our own points-based immigration scheme, which will affect students as it will affect others coming into this country to study, do research or work. I refer to the CASE policy report on the role of international students in British universities. If we allow them to stay, many will go on to do some superb work. The report makes some very good recommendations about how to attract foreign students to study and do research and development work in British universities and how to get them to stay here in order to help British industry and commerce develop its exports. I hope that the Secretary of State will take some of those points into account.
The rules of the House dictate that Liberal Democrats get just one Front-Bench contribution during the day's debate on the Gracious Speech. Bearing that in mind, and given current economic circumstances, we felt that housing was the most pressing of the three important issues grouped together for debate today. That is why I, as the Liberal Democrat spokesperson for housing, am speaking on behalf of my colleagues—it is not just because I miss debating with the Secretary of State for Innovation, Universities and Skills and Mr. Willetts. I have say, however, that, a year on, it does not seem that the debate has moved on a great deal— [Interruption.] I am making no comment on that, but explaining why I—rather than my hon. Friend Stephen Williams, who shadows the Secretary of State for Innovation, Universities and Skills—am responding to the debate.
I am relieved to note that Mr. Hayes was in his place for the opening speeches, despite his pantomime —[Interruption.] There is obviously a comic genius on the Government Front Bench. It is a little odd that the Conservative housing spokesperson is not in his place today, especially when I thought that the Conservatives had actually chosen the particular days for these debates. I know that they have been changed, but it seems a little strange. I do not know whether the Conservative Whips fail to communicate well with their own Members or whether this subject has just dropped down the priority list during the week.
The housing crisis in this country is not new and it is not merely a product of the recession. Waiting lists for affordable housing to rent have been rising steadily over the last decade in which Labour has been in power and now stand at around 1.7 million families. In common with those of most other Members, my advice surgeries are filled with desperate families struggling to get decent accommodation they can afford. There are families suffering overcrowding and families whose children have nowhere to play, let alone do their homework; there are families whose children are sharing the parent's bed because another sibling is already sleeping on the sofa; there are families for whom overcrowding is causing condensation, which has led in turn to mould so that the children all have asthma—or, even worse, the whole family has tuberculosis. That may sound like Victorian Britain, but it is happening in new Labour Britain today. This problem is not new; it is just getting worse.
About 90,000 children live in temporary accommodation in England, and two thirds of those live in London. In some boroughs such as Haringey, one in seven children live in temporary accommodation; in Brent, the comparable figure is one in 10. One of my constituents, who is almost my age, has spent her entire life in temporary accommodation. She was born into temporary accommodation and is now raising her own children in temporary accommodation; the repeated moves and long-term uncertainty have blighted a whole generation.
This country's housing crisis has been and continues to be about supply and demand, and it affects everyone in the chain: it prices homes out of reach for first-time buyers, it prices renting out of reach even for some families on average earnings, and it puts huge downward pressure on those at the bottom of the earnings table who are forced to queue hopelessly for social housing. What is new is the impact of the recession on those who were previously secure in their homes: families who could afford to pay the rent but who, now out of work, find themselves looking for emergency help from their council; and families owning their own property whose circumstances changed so that they find themselves falling behind with their mortgage payments.
My hon. Friend raises a very important point about rents. Is she not surprised that while the Government have gone to great lengths to declare their desire to assist people who are struggling to pay their mortgage, they have forgotten the need to provide similar support to people who lose their jobs and can no longer afford to pay their rent?
My hon. Friend is absolutely right. Part of the problem with the current housing allowance system is that it often slow to kick in. I certainly see constituents in that difficult position and I would be very surprised if other hon. Members across the country did not see it, too. It takes a long time to kick in and a long time to be administered, particularly if there are any subsequent changes in circumstances.
As my hon. Friend said, there has been considerable debate about what to do when people lose their jobs or become sick, but many people who own their own homes may find themselves in difficulty just as easily if they finish their fixed rate mortgage period and find they cannot move to a cheaper deal because they are now in negative equity or because they have inadequate equity in their property for the new climate of lending. The immediate and pressing danger is that we will see many more families seeking emergency help, which will be a disaster for them, and near impossible for councils to manage.
The Council of Mortgage Lenders has predicted that repossessions may rise to 75,000 next year—a figure that my hon. Friend Dr. Cable predicted some time ago. The Government have taken positive steps in trying to head off large-scale repossessions, but there is a great deal more concrete work that they should do in this area.
On the surface, last week's announcements on interest holidays were very positive, but as always with such headline grabbers, the devil will be in the detail. The Minister for Housing, who is not in her place today, has suggested that just 9,000 families may be eligible for this scheme— [Interruption.] I see, of course, that the Under-Secretary of State for Communities and Local Government, Mr. Wright, who shares responsibility for housing, is in his place. There are so many Ministers, but so few names that we are allowed to name in the House!
As I was saying, just 9,000 families may be eligible for the scheme, making it a drop in the ocean in the bigger picture of repossessions, and it will leave 66,000 families out in the cold. Similarly, it is not yet clear what the criteria for eligibility will be. Will families need to be in receipt of benefits to be eligible? Will it apply only to mortgages or will it also apply to second charges? Will the same rules apply to families with two earners as with the income support for mortgage interest scheme, where if the main earner loses their job the family is ineligible to claim if the other partner earns anything at all, even if they just work part-time and earn very little? We certainly know that the scheme will not apply to those whose mortgages are not with the main eight lenders, meaning that around one in three mortgage holders are not eligible.
I expect the Government to respond by saying that this is what the pre-action protocol is for, but while all of the sentiment in the pre-action protocol is welcome, as is the stipulation that it must apply to all lenders, it is not clear who will be policing the protocol. It does not give the courts powers, for example, to throw out a case if lenders have not followed the protocol, or to issue a fine.
If the Government want to give the courts teeth to enforce good practice on repossessions, they will have to be prepared to update our outdated mortgage law. It baffles me that they are unwilling to do so, and they had a prime opportunity in the Banking Bill in the previous Session. My colleagues tabled amendments to that effect, which the Government rejected. The Government also had a perfect opportunity in last week's Gracious Speech. Again, they chose not to take it. Mortgage law is mired in its common law origins in the 18th and 19th centuries. It is based on the mortgage contract, so it is weighted in favour of the lender, giving the courts only limited powers to intervene. If the Government want to give courts powers to intervene, they will have to legislate to make that possible. Surely now is the perfect time to drag mortgage law into the 21st century.
It is unacceptable that lenders have the right to sell a property over a borrower's head without first going through the courts, for example. Certainly, there have been times when that has happened. In a classic case earlier this year, known as the Horsham case, the lender exercised its power of sale with the borrower still in possession. The new owner then brought proceedings to evict the borrower as a trespasser, and the borrower has lost any claim to equity as a result. The case appeared to give the green light to lenders to circumvent the courts' powers altogether by exercising power of sale. Foreclosure, although little used, is still available. It enables a lender to obtain an order for possession, but in doing so extinguishes the borrower's equity of redemption, so that the lender keeps the entire proceeds of the sale. It is hard to justify that remedy having any place in modern mortgage law.
As I said a moment ago—I heard a lot of talking to my left, so it is possible that the hon. Gentleman could not hear me—unfortunately, although there is much good sentiment in the Government's proposals, there is no enforcement power for the courts or possibility of policing them. The courts cannot throw out cases if a lender does not follow the protocol, or issue a fine. Although I welcome everything in the pre-action protocol, some of it needs to be put on a statutory footing if it is to have any teeth. I do not disagree with the sentiment, but there are more practical ways of achieving the aim.
I would like the Government to legislate for the following: to require a lender that wishes to enforce its security to do so only through the courts; to give the court a general discretion in mortgage cases to make orders that are just, according to the case; to restrict lenders' statutory and contractual power of sale by making it subject to the requirement to obtain an order of the court; and to abolish the common law remedy of foreclosure. I hope that the Minister will say why the Government have so far refused to do that.
I am also disappointed that the Government have not taken immediate action to regulate the private sale-and-rent-back market, to which many vulnerable people are already falling prey. The Minister for Housing has called such practices unscrupulous and promised to tackle them, but no plans have been forthcoming. I would like those practices to be brought under Financial Services Authority regulation. When will the Government do so? Similarly, the Government have promised to put in place a public scheme to allow people to downscale their investment in their property and move towards shared ownership, but no details have yet been forthcoming.
I am also disappointed that the Government have not taken advantage of the current economic downturn to plan sensibly for the future. The recession has opportunities as well as threats, and we have a duty to make the best of current circumstances. I would like to have seen more money front-loaded from the comprehensive spending review for housing associations and councils to buy up land and appropriate housing now, while land and property is cheaper, so that we can tackle the long-term problems of access to affordable housing. In the short term, greater flexibility might be needed in some areas about how much subsidy is available for each unit. Housing associations say that building social housing has dried up; they can no longer proceed with projects that rely on cross-subsidy from private sales. Similarly, councils rely on section 106 money from private developments for their own social building programmes, and those too have all but dried up in many areas. We cannot allow all social housing building to grind to a halt, because the consequences will last a generation.
I endorse strongly my hon. Friend's comments. There is the potential for a win-win-win if the Government provide the resources to allow councils and housing associations to build even small schemes, or buy houses on the open market. That will provide homes for those in housing need and enable people in the construction industry to carry on working and not fall into housing need themselves. Will the Government do something about that urgently? [Interruption.]
The Under-Secretary of State for Communities and Local Government, the hon. Member for Hartlepool, says from a sedentary position that the Government have done something. They have announced some money, but we are asking for greater front-loading. They have not freed up councils to borrow so that they can build. The money continues to go through housing associations, so councils, which must pick up the pieces when everything falls apart, have little power to address the problem. If they are to be able to borrow to build, the Government need to make changes to the stability of their income. They need to end the process whereby one council tenant in one area subsidies a council tenant a long way away in another borough. The subsidy should come from general taxation, so that councils can be sure of their income and of right-to-buy capital housing receipts. That would enable them to borrow in the same way as housing associations.
I agree with many of the hon. Lady's comments in this part of her speech. Is she aware that, a few months ago, the Government could have bought a major house builder for £2 billion? That house builder had 110,000 building plots, which works out at about £26,000 per building plot—the prices are probably lower now. We could have done exactly what Dr. Harris said, and put unemployed construction workers to work, and build housing, of which the United Kingdom has a huge, and worsening, shortage.
I entirely agree with the hon. Gentleman. We will see many developments that are not completed and that lie empty, especially flats. One of the problems for housing associations is that the Government wimped out of producing the same regulations for private property as for social housing for rent. If those regulations were much more closely aligned, councils and housing associations could buy up many more of those properties, which could be used to house many more vulnerable people. The Government could still do that in relation to land, and the hon. Gentleman's point about the construction industry is important. If we lose the opportunity, and the construction industry takes a deep hit, skills will be lost, career paths will be changed, and it will take a decade to get plans back on track after the recession is over.
I am disappointed that instead of announcing a costly VAT cut, which will make little difference to anybody buying anything less expensive than an imported flat-screen television, the Government did not equalise VAT on new build and renovation. That would make a genuine difference to properties lying empty in this country. At a time of recession, we will see many more empty properties blighting streets and neighbourhoods, and yet more families with nowhere to live. The Government could deliver a practical solution.
Last week's Queen's Speech failed to mention housing once. The Prime Minister's response was long on headlines but as yet is still short on detail. Unfortunately, that is typical of much of the Government's response to housing. They have said much, and promised more, but little so far has been forthcoming. By the end of next year, 75,000 families may be repossessed; 1.7 million families are waiting for social housing; one in 10 of the children in my constituency are in temporary accommodation. The Queen's Speech was a wasted opportunity. My constituents cannot wait while the Government promise to act. The Government need to act now.
It is a great privilege to have been elected to this Chamber and to have the opportunity this evening to make my maiden speech.
The traditions of this Chamber bring many benefits—I am told that this is a prime education forum. Had I been making an address in another educational context, Members would have been subjected to the obligatory PowerPoint presentation, sometimes described as an overhead on steroids. The four weeks since the by-election have been frenetic—"whirlwind" would be a euphemistic term to describe my induction. I thank many Members, across parties, for their camaraderie, forbearance and directions on meeting a lost soul around the parliamentary estate. Not once have I been directed to the wrong Lobby—yet.
During the campaign, I was asked how a novice would cope in Parliament. I assured the questioner that I had no aspirations to become Leader of the Opposition, seeking to lead the country—and that, as a head teacher, if I could cope with 1,500 boisterous youngsters, I could surely survive here. That was, of course, before my first experience of Prime Minister's Question Time.
I plan to contribute directly to this interesting debate in due course, but first, in line with tradition, I wish to refer to my predecessor in the House, the late John MacDougall. That is particularly appropriate and particularly poignant, because today, as we remember John, would have been his 61st birthday.
John was a first-class constituency Member who earned respect in all the communities in central Fife. He was a man of integrity, a man of compassion and a man of good humour, who had high aspirations for his constituency. He believed that education was a personal engine for development. Indeed, as leader of Fife council he introduced universal nursery education for four-year-olds long before other parts of the United Kingdom. He lobbied hard to secure investment in skills for the world of work beyond school and for work-force training, a theme to which I shall return later. He also championed the interests of the elderly in our communities, liberating senior citizens in enabling them to access public transport at no personal cost.
John successfully led a campaign against the break-up of the ancient kingdom of Fife during local government reorganisation, recognising the dividends of a united kingdom. He enthused about the benefit that accrued to this constituency, and to Scotland, through its remaining an integral part of the United Kingdom. Indeed, as a passionate and patriotic Scot, he emphasised that the saltire was not the sole preserve of one political party. The Scottish National party has a tendency to claim it as its own, but he reminded Scots regularly, as I do—no heckling!—that it belongs to all Scots, the vast majority of whom have no appetite for separation.
However, it is at times like this that we must remember that there are more important things than politics. John's life was tragically cut short by an asbestos-related lung condition, mesothelioma.
Sadly, John has not been alone in suffering from industry-related diseases in the constituency. In 2006, in his maiden speech, Willie Rennie warned of a national mesothelioma hot spot. Working conditions in the mines and the dockyards have had a devastating impact on many lives in our constituencies It is to the great credit of this Government that compensation schemes have been put in place to support people with work-related and debilitating diseases. Those schemes have been well received and generally successful, and I am aware that Ministers are currently trying to ensure that all cases are dealt with in a timely fashion and with minimum bureaucracy. However, while the legal process by and large has been handled in a very responsible fashion, concerns remain about a handful of legal firms that have exploited the situation to their distinct benefit. Ministers have also been tackling that issue in a serious and determined manner, trying to ensure that maximum dividends go to the people who have been so adversely affected.
Over the past two years, knowing full well the seriousness of his condition, John demonstrated outstanding courage and commitment to his constituents. He was still active in the last two weeks of his life, and the House is all the poorer as a result of his untimely passing.
In characteristic fashion, John's wife Cathy is currently trying to set up a trust in John's name to undertake further research on asbestos-related diseases.
John's perennial quest to improve the lives of others and seek fairness and social justice is also mine. I hope that I can live up to the challenge in the same way as John, and go on to inspire people and enhance their life prospects.
Like John, I have spent all my working life in Fife, and most of it in my constituency. Let me explain to Members who are not aware of the location that Fife is on the east coast of Scotland, south of Dundee and north of Edinburgh. The largest community is Glenrothes, a new town that was established in 1948 to tap the huge coal reserves at Rothes colliery. However, after major mine flooding Glenrothes had to diversify very quickly, and soon attracted a diverse range of new industries and businesses.
Many other smaller but equally important communities make up the constituency, many of which were devastated in the 1980s as a result of the quick demise of traditional industries. They demonstrate a strong sense of identity. They have proud traditions as caring communities, supporting the weak and vulnerable in society. In my opinion, the boundary commission did a disservice to those many other communities, such as Kinglassie, Cardenden, Leven, Methil, Buckhaven, the Wemyss villages, Windygates, Kennoway, Thornton and Kirkcaldy North, by calling the constituency Glenrothes. I should prefer a constituency title reflecting the composition of the constituency more accurately, and I will pursue that further in due course.
Members will be interested to know that my constituency neighbour is my right hon. Friend the Prime Minister. Indeed, until recently I was rector, or head teacher, of the Prime Minister's old school—but not, as one reporter commented, the Prime Minister's old head teacher. Had that been the case, I think I would have been in the Guinness Book of Records as a new entrant to the House of Commons in my mid-eighties. However, the change in title from rector to Member of Parliament means that I no longer receive correspondence from other parts of the United Kingdom addressed "Rector of Kirkcaldy high school" and beginning "Dear Reverend"—or, in one case, "Your Eminence".
Let me assure hon. Members that, contrary to press speculation, I was not approached personally by the Prime Minister to stand as a candidate. I have concrete evidence to substantiate that assertion. When I challenged a reporter about the timing of the alleged early phone call, expecting a day in the week to be cited, she suggested that it had been made just after 8 am. I understand that it is common knowledge that when the Prime Minister telephones early in the morning, it is between 5 am and 6 am at the latest.
I have taken advice, and have been assured that telling tales out of school does not constitute a leak. I can therefore reveal exclusively that, when at school, the Prime Minister was involved in a very unfortunate cover-up. The Prime Minister was a talented sportsman. His athletics victory in the Fife championships was described in a superb piece of hyperbole. The school magazine editor of the day noted that he had won the 400 yards by "miles". However, the editor later lamented that the Prime Minister had been disqualified because he had worn a rugby shirt over his vest, thereby concealing his number. Clearly the Prime Minister has learned lessons from his school by experience: he has been very open with numbers as the Government have supported people through the current economic downturn, although whether all the numbers would fit on an athletics vest is another matter.
The Prime Minister also received the leather strap for a misdemeanour at Kirkcaldy high school. I understand that he has no sadistic tendencies, but he does take pleasure in leathering the Opposition. [Hon. Members: "Oh!"] Can do better.
Regeneration schemes have brought new opportunities to my constituency. Over the last 10 years, 10,000 jobs have been created in Fife. In my constituency today, that diversity is reflected in well-established businesses such as Tullis Russell, which produces high-quality paper. The energy company npower has just invested £100 million in a biomass plant, thereby reducing the carbon footprint dramatically. Diageo—which, I am sure, is popular with Members here—produces superb Scotch whiskies, and recently won the prestigious national gold award for healthy working lives.
Raytheon, which operates in the defence industry, is a major high-technology employer, and there are new industries, too: BiFab is in the vanguard of alternative green technology developments, manufacturing platforms for offshore wind turbines and developing structures to harness tidal energy. Incidentally, it cannot praise highly enough the continued support for, and investment in, its extension plans from the Royal Bank of Scotland.
What do these companies, and the many other successful businesses in my constituency, have in common? They sustain their success through difficult times by being innovative and proactive. In particular, they have anticipated changing market conditions. They have managed change well, they have consulted their work force and, above all, they have invested in people to ensure sustainability, competitiveness and prosperity. In short, they have translated good ideas into effective practice.
The same challenges lie ahead in politics, especially during what has been described by many as the first financial crisis of the global age. It is often said that vision without action equates to daydreaming, and action without vision inevitably leads to chaos. We live in unprecedented times, with global economic challenges that will influence the lives of all of us, so thank goodness for a Prime Minister and Government with the clear vision to lead us through these demanding times with a well thought-out action plan for the next few years—no heckling, please. This strategic plan should take us through the downturn with minimal impact compared with other countries, and bring stability and a return to growth in the years ahead.
As a newcomer to Parliament, I have heard nothing to convince me that the Opposition have any viable alternatives—certainly, in my book doing nothing is not an option. Like John MacDougall before me, I emphasise the need to continue to invest in people by enhancing training and professional development. As my right hon. Friend the Secretary of State said, it is relatively easy during an economic downturn to hit apparently soft targets such as skills training and development. However, if we do not nurture human capacities and unlock the potential of our work force, we will not have a competitive edge as a nation when the upturn comes.
Lord Leitch of Oakley noted in his recent Carnegie lecture that, in terms of current global economic competitiveness, despite the strengths of the UK's education system, our productivity is distinctly average; he described it as "undistinguished mediocrity". Competitors such as the USA, France and Germany are at least 15 to 20 per cent. ahead in the productivity stakes. This is not about protecting business from change; it is about being proactive in preparing for it.
In my professional field, I have worked with colleagues to shape the future in education, and I have often used the following anonymous quotation to urge people to try to take ownership of their destiny:
"Traveller, there is no path; we make the path as we go—on the journey to improvement" .
In other words, whatever the support, only we—the people in a particular business, community or service—can fix things. A positive attitude, optimism and a can-do mentality are of fundamental importance.
The Government must be congratulated on their investment in modern apprenticeships. It is through effective leadership and skills training that we will nurture creators of wealth. It is disappointing that the Scottish Executive have not yet made the same commitment to modern apprenticeships north of the border, and I hope that MSP John Park's Bill to extend modern and adult apprenticeships will receive cross-party support in Holyrood, thereby ensuring that Scots youngsters have the same opportunities as those in the rest of the UK.
We must do more, however, to bridge the academic-vocational divide, and ensure parity of esteem for vocational qualifications and extend the scope of vocational degrees. For too long, they have been perceived as the poor relation, but such qualifications will be critical in reinvigorating our economy. We must do more, too, in targeting training to future employment opportunities, and arrange that training is demand-led. As a matter of priority, we must do more to address the challenges faced by a small but significant cohort of our population who are not functionally literate and numerate. To be world class and highly competitive in the global marketplace, upskilling must be a key national objective, and this Government have extended their commitment to guide and facilitate such progress.
For politicians, and for business, this shared skills agenda demands continuing priority, passion and perseverance. Quite simply, we cannot afford to fall behind; we need to unlock the vast reserves of human potential, and to build a fairer and more prosperous society. It is imperative, particularly during these difficult economic times, that we invest in people, look forward with optimism, talk up the successes and focus on the things that really matter.
In conclusion, I return to the examples of best practice cited earlier from my constituency, both in business and social investment. For the future of this great country, the drive to enhance economic and social skills must be relentless as we strive to improve the life prospects and chances of our constituents. As a former rector, I have spent years leading other learners, but have had to demonstrate throughout my professional career that I am a leading learner myself. The last few weeks have been challenging and I have been on a steep learning curve. This applies not only to Parliament, but on the doorstep.
When canvassing, we see life "in the raw". In the later part of the campaign, I met a lady who was obviously somewhat intoxicated. Aware of party political interest in happy hours and excessive alcohol consumption—I must make it clear that of course I am not referring specifically to Members—I asked how many drinks she had had, to which she replied, "Son, I'm an alcoholic, not an accountant."
I am grateful for this opportunity to make my maiden speech. I also appreciate the words of reassurance and encouragement received from many Members. "Don't worry", they said, "it will be straightforward—and not all will be listening anyway, and some might be asleep. It is not a daunting experience." I can assure Members that it is, although I understand that few acknowledge that this is the case until the experience is over.
Finally, I have had the privilege of leading two large successful secondary schools, and I think that it is entirely appropriate that I conclude by citing their mottos. The first echoes the theme of my speech. It comes from Inverkeithing high school—"Grow by Choice". The second summarises my commitment to this Parliament and to my constituents: "I will strive to do my utmost." Now, where have we heard that before?
To be able from time to time to congratulate a Member on a maiden speech is one of the genuine privileges of being in this House, and I think all Members will agree that we have just heard an outstandingly good maiden speech. Lindsay Roy is clearly rooted in his constituency, and his experience comes from being rooted in it. It was a witty speech, and I say to the hon. Gentleman that if he can make colleagues in this House laugh occasionally, he will be more than halfway to holding their attention. I am sure we will hear a lot more from the hon. Gentleman in the future.
The hon. Gentleman and I share two things at least. The first is a love of the Union. My mother is a Scot; her name is Oina Paterson. Secondly, the hon. Gentleman and I are both constituency neighbours of the leaders of our parties. That can sometimes be good news, but it can on occasion mean that one really has to check the line to take; otherwise, we can find ourselves saying to every inquiry, "I do not do surveys," if we do not want to have embarrassing discussions with the Whips as to why we appear to be taking a somewhat different line from the leader of our party.
We all look at the Queen's Speech from the perspective of what it says to speak to the condition of our own constituencies. Interestingly, the proposed subject for today's debate is employment, universities and skills and housing. We have heard very little about employment, other than what the Government intend to do to reorganise the Learning and Skills Council and other such things; they are just reorganising the furniture of the machinery of government. The recession is hitting the M40 corridor with some vengeance. Last week, Aston Martin announced that it was making a third of its work force redundant at Gaydon, and Honda announced that it was looking for a buyer for its Formula 1 team at Brackley and that if it did not find one, it was simply going to pull out and close altogether.
A vibrant specialist, high quality motor racing industry has always been based along the corridor from Longbridge to Cowley, which goes up the M40, providing highly skilled jobs. That is reflected in the fact that Banbury is home to excellent companies such as Prodrive; indeed, when the Queen and the Duke of Edinburgh visited Banbury the other day to celebrate the 400th anniversary of the borough of Banbury's having received a charter, Prince Philip, unsurprisingly, visited Prodrive. So, it is a matter of concern when high quality, specialist automotive engineering jobs such as those disappear in such large numbers. I pray to God that Honda finds a new buyer, because it generates many excellent supply jobs not only for itself, but throughout the local economy. It will be incredibly bad news if that starts to unwind.
The M40 corridor is not only losing jobs in high-tech manufacturing, as we saw—again this happened last week—with what happened to the Alden Group, a printing business that was based in Oxford, but is now based in Witney. It was a family business going back six generations; it was second only to Oxford University Press. It had been sold by the family earlier this year to a German company as a vibrant, strong going concern, but last week the administrators were called in. I do not know the exact details, but I would be willing to speculate that it was not because of any inherent weakness in the Alden Group. I suspect that, as with many companies, a hedge fund or some other organisation in the new company's structure found itself in financial difficulties, that necessitated a fire sale, its investments were undermined and unwound and that lead to the loss of jobs.
The recession is already hitting the M40 corridor, but research by the Local Government Association tends to suggest that counties such as Oxfordshire will be hit far worse by this recession than by any previous one and that Oxfordshire will be hit far worse than many other parts of the United Kingdom, not least because of the large number of jobs in Oxfordshire that depend on financial services. The jobs of people who travel to London, Reading and other financial centres on a daily basis may start to unwind. Such people will never have expected to have been out of work or to have lost their jobs.
What help will such people receive? They will go to Jobcentre Plus and they might be eligible for jobseeker's allowance, and I wish to make two points on that. We have heard a lot today about training—Train to Gain, adult training and other types of training. When people become unemployed, they often want to acquire new skills, perhaps to find other opportunities in the world of work, but one of the perversities of claiming JSA is that people cannot train while doing so. The other day, I learned of a constituent of mine who had been made redundant and who had decided to use his savings to train to become a driving instructor. He discovered that because the job centre did not consider him as being available for full-time employment, he lost his JSA, so he was doubly hit. I hope that Ministers will examine the ability of those who are made unemployed to find opportunities to train without losing their benefit.
Many people who have skills will want to contribute those to the community by doing voluntary work while they are looking for work, but they, too, find their claims for JSA undermined. I say to Ministers that there is a difference between the welfare reforms that the Government are introducing in the Queen's Speech, which seek to get those who have never been in work into the world of work, and the system in respect of people who have been in the world of work, desperately want to get back into it as quickly as possible and want to make a contribution to the community or to acquire new skills while they are unemployed—for the shortest period of time. Our system must recognise the contribution and aspirations of those who have been out of work and want to get back into it as quickly as possible.
For many of those who lose their jobs, life will be an enormous shock; it will be very dislocating, particularly if they have been working in other parts of the country, such as London. One thing that I hope we can do in Oxfordshire—I am discussing this with Oxfordshire county council and the Oxfordshire Economic Partnership—is set up informal jobs clubs in Banbury and Bicester, whereby people who have lost their jobs can come together to take strength from counselling and the experience of others, and can have the support of outreach workers from Jobcentre Plus and the LSC—until it disappears. Why on earth, yet again, should another bit of the machinery of government be abolished just when it might be helpful? Such clubs could also provide people with access to intelligence about what might be happening in the labour market. In short, we should make it clear to them that the community wishes to do everything that it can to support them and get them back into the world of work as speedily as possible. Each and every one of the unemployment statistics is an individual person who has a family and who has individual ambitions and aspirations. Getting such people back into the world of work as speedily as possible is the collective responsibility of us all.
The economy of my constituency is almost entirely dependent on small and medium-sized businesses. What I find so unbelievably frustrating about this Government is not only that they are strong on rhetoric and headlines, but when one starts to dig into the headlines, one finds that there is just no substance. In the pre-Budget report, the Chancellor of the Exchequer devotes a whole section to "Supporting business", in which he makes the following acknowledgment:
"Businesses are facing an exceptionally challenging economic climate with uncertainty over the short to medium term."
He then goes on to give some indication of the help that the Government are supposedly giving to small and medium businesses. Measures to help those firms facing credit constraints include a new small business finance scheme to support up to £1 billion of bank lending to small exporters, a £50 million fund to convert business debt into equity and a £25 million regional loan transition fund. On the surface, that is all good stuff, so I tabled some parliamentary questions to the Treasury, asking how small businesses might access those funds. All those questions were transferred to other Departments, so they will, I hope, be answered in due course.
Not surprisingly, however, it was not long before I started to get letters and e-mails from businesses in my constituency saying, "Hey, we'd like to know how to access this money and help, because no one is telling us where to go, and wherever we go, we're told to go somewhere else." For example, the director of a marketing company in my patch, which had 17 employees in September, e-mailed me to say:
"On the 25th November the chancellor announced a £1 billion small business finance scheme designed to help struggling companies gain credit during these difficult times. This whole scenario started when I tried to find out who would be managing the fund and what the route to the fund was. Firstly I contacted Banbury Chamber of Commerce and they...suggest I contact Business link. This I did at the Thame office. They had no knowledge of the fund and couldn't help. I then had a call from the Chamber saying the funds were being managed by Regional Development Agencies."
Over the past few days, my office and I have been trying to discover just where these funds are, and it is the most extraordinarily frustrating experience. The pre-Budget report would tend to suggest that some of these funds are being managed by the RDA. I telephoned the South East England Development Agency, which covers Oxfordshire, and I asked how small businesses could access the new small business financial scheme designed to help struggling small companies, and it said that it did not really know anything about it and suggested calling Business Link. So the next day, we asked the same question of SEEDA, and we were again told to call Business Link, but given a different number. We were told that if the business were eligible, Business Link, which is funded by SEEDA, could give advice on how to apply. So we called Business Link, and it said that it does not give funding directly, only advice and information. It also said that it had no information about the new funding, but it would do some research and ask a colleague to call me. Today, I received an e-mail from a client service representative from Business Link in London, which states:
"I do not have any substantial information on the new funding scheme for SMEs, and will send you any information I receive from our research team. They will not be able to give me a response by Monday, but I will contact you on Tuesday...to update you."
Two weeks after the Chancellor purportedly produced a package of measures to help smaller businesses, no one in the machinery of government can explain to a Member of Parliament how any small or medium business in my constituency can access any of that money. That is a disgrace. Businesses all over the country are bleeding. They are desperately short of credit and in need of help and support. It is therefore unacceptable that no one can explain what they should do.
Then there is the whole issue of the scrapping of the learning and skills councils. Just as businesses in my constituency started to understand the Heart of England training and enterprise council, this Government scrapped it, just after they came to office, and set up the learning and skills councils. I have lost track of the number of times the LSC for Oxfordshire has changed—it has moved headquarters, its remit changed, and its regional operation has changed, so that at one point it included Milton Keynes and then it did not. At one point, people had to ring somewhere in Kent to discover what was going on, and then they had to ring Abingdon. That is a nightmare for small and medium businesses.
People are now beginning to understand what the LSC does, so of course it is now being scrapped and we are to have a new skills funding agency. That will be dependent on parliamentary approval in the children, skills and learning Bill, so it will not come in next week. There will therefore be a hiatus, just at the time when people need to know where they can get help. The LSC will be in its death throes and key staff will doubtless be leaving to look for other work. Until the Bill is passed, we will not know where the skills funding agency will be based, how it will be organised and how people will be able to access it.
The Gracious Speech provides nothing that will assist businesses in my constituency. For most of them, their main concern is getting access to credit. They find it frustrating that the banks, which have received very large amounts of money from the taxpayer, do not appear to be advancing credit, notwithstanding the exhortations of the Government. The Government do not seem to be taking any cognisance of the fact that credit in the economy has fallen close to zero, which is the lowest level in nearly 30 years. Not surprisingly, the CBI says that the number of firms reporting reduced and withdrawn lines of credit is going up every day. Instead of lending to businesses, the banks are cutting down their balance sheets. If everyone does that at the same time, the recession will clearly get deeper.
I hope that the Government will reconsider a suggestion made by the Opposition. I find it objectionable that the Government's only mantra is to go around shouting that everyone else is doing nothing. It is the Government who are doing nothing apart from publishing press releases, because the schemes are not coming. They say that they will make credit available, but perhaps they ought to take notice of the national loan guarantee scheme that we have proposed, which would underwrite lending from the banks to British businesses for a commercial insurance fee, passed on by the banks. Such a scheme would properly protect the taxpayer. Banks would be able to use the scheme's guarantees to underwrite a significant proportion of any new loans to businesses, so they would not be reckless loans. In that way, we would ensure that the markets would start moving again.
The Government must start to do something fairly speedily because it is important that small and medium-sized businesses get going at this time. The construction industry, of course, is an important part of that. As the Minister responsible for housing, the Under-Secretary of State for Communities and Local Government, Mr. Wright, is here, I want to take a couple of minutes to make some comments about housing.
One of the Government's crazier ideas was the Weston Otmoor eco-town. I shall not detain the House on why it was and is one of the craziest ideas in God's creation to have such a development predominantly on a greenfield site and for it to be dependent on digging up pretty much the whole of Oxford railway station and every railway bridge around Oxford—that is neither here nor there. There is no debate about the fact that we need new social housing in this country. I agree with much of what Sarah Teather had to say. One of the tragedies nowadays, as has been made clear by the chairman of the Centre for Social Justice, my right hon. Friend Mr. Duncan Smith, is that working families on low incomes find it very difficult to access social housing. It is perverse that those who are on low incomes and in work are, if we are not careful, condemned for ever to the private rented sector, which means that stability is lost in our communities and in areas of our constituencies.
We need new social housing, and so Cherwell district council has said that it is willing to support an eco-town proposal on the edge of Bicester if the local development framework is gone through to identify where it should be. That, I think, would be good news for Bicester. It would give some proper focus to a town that is in effect a new town, as it has grown very fast over the past 20 years. However, any such development will depend on the investment put into housing associations by the Housing Corporation. One cannot expect all the developments of the next 10 to 15 years to happen on section 106 agreements. Developers are simply not doing that. Wimpey lost 98 per cent. of its market cap in one year alone and most large-scale developments in my constituency have either ground to a halt or are moving at only a snail's pace. If the Government want us to proceed with initiatives such as eco-towns and eco-housing, they will have to be prepared to consider allowing the Housing Corporation to invest in social housing in constituencies such as mine in north Oxfordshire.
Nothing in the Gracious Speech will do anything of real value for my constituents. It is all very well to talk about more apprenticeships, but as the Secretary of State for Innovation, Universities and Skills said, apprentices need employers. Of course they do, and in my patch we are desperately trying to maintain employment, but it is dependent on small and medium-sized businesses and although the Prime Minister and the Chancellor talk a good talk about what they are supposedly doing for small business, in practice and in truth, when we ring up and ask, "How do my constituents access that help?", answer comes, "We do not know."
I welcome my hon. Friend Lindsay Roy. It is good to have an educator turned legislator. It is a shame that Scottish National party Members are not in the Chamber, as I am sure they would agree that my hon. Friend and the people of Glenrothes taught them a lesson on
I pay tribute to my hon. Friend's predecessor, John MacDougall. The best tribute the House could give John MacDougall would be to put pressure on my Government to put right the scandal for people with pleural plaques and asbestos-related disease following the Law Lords deciding in their wisdom last October that those diseases could not be compensated for. Members of the House are working with Ministers to try to reverse that decision, and I hope that as a tribute to John MacDougall and the thousands of other people who have been illegally and criminally exposed to asbestos for many years the House will take that on board and support those who are trying to seek justice.
I shall talk mainly about apprenticeships, but also about housing. Nearly 40 years ago, I was fortunate enough to be welcomed as an apprentice with the National Coal Board. At the time, it was seen as a good, high-quality apprenticeship and in April 1969 I was paid the grand sum of £7 and 6 shillings a week, and thought myself well paid. The apprenticeship was not just practical. It was not just about learning how to repair and install machinery; it was also very much an academic qualification. We studied mathematics and engineering part-time on day-release, and we had to study and understand mining legislation in particular.
The vast majority of the rules governing mining are, thankfully, not just rules of conduct but were laid down by the House—sadly because of the serious incidents over many years, when people were killed in coal mines in a multitude of ways. The House took its responsibilities seriously and people who trained as craftsmen in the mining industry had the responsibility to learn the legislation and implement it. When I became a craftsman, the mines were much more mechanised than in earlier years, but sometimes that just meant there were different ways of killing people. If a person did not do their job properly, not only did they lose millions of tonnes of production, they could also ruin other people's lives.
I was 19 years old when I had served my time. The apprenticeship was a badge of honour; it was important. It brought status, and part of it was that when we became older and had more experience we passed our knowledge on to the next person in line. The young kids coming through were aware that the knowledge was handed down from generation to generation. It was an important part of the culture for people to serve apprenticeships.
Two years ago, I was asked to be a Parliamentary Private Secretary in the Department for Education and Skills, which became the Department for Innovation, Universities and Skills. I asked, "What's the agenda? What's the main idea that you're pushing?" It was the skills agenda. In the two years in which I worked in DFES with the Secretary of State for Innovation, Universities and Skills and my hon. Friend Bill Rammell, by and large, despite the brickbats that we normally throw at each other across the Chamber, the general view was that people in the Department were trying to do the right thing by improving skills and addressing the issues that we face in a global economy.
Obviously, there was discussion between the parties on where we were going and what we were doing, but by and large, people accepted that the Minister and the Secretary of State acted in good faith, and engaged with and worked with people, particularly in the Committee stages of Bills. The Minister and the Secretary of State would appear before the Education and Skills Committee and ask, "Can we find a way to take things forward?" I am not suggesting that that is not mirrored in other Departments, but there was a genuine attempt to try to find consensus. Obviously, at the end of the day Members have different party backgrounds and we divide on tribal lines, but in general we tried to move forward.
It was frustrating for me, as a PPS in that Department, to listen to the criticism of the apprenticeship schemes then in place, because Opposition Members talked about apprenticeships of the kind that I had had. They spoke of something almost like a guild, in which people would work for a time. They would work with a craftsman who had been there for a long time, and who had worked in the industry for many years. That totally ignored the fact that we are now in a very different world. I will be quite honest: I wish that we were still in a world in which we had that level of manufacturing, and the real, serious, heavy industry that produced work of that nature. However, the truth is that we are not in that world, because 20 years ago, the Conservative party had a deliberate policy of de-industrialisation, de-skilling and mass unemployment. It wanted to develop a low-skill, low-wage economy, and it did so very successfully.
The Conservatives devalued the status of work done by people in the public service, such as ancillary workers and cleaners, who were taken out of the public sector work force. People who had been devoted to the national health service did not feel the same sympathy and passion when they belonged to the Joe Bloggs cleaning company; we see the results of that today. It is a different world now, and clearly we have to accept that.
One of the criticisms made today is that public sector apprenticeships are not being created, and I accept that criticism. It is an absolute disgrace that the public sector has not filled the gap that was left by the demise of heavy industry. Again, we have to look at some of the reasons why it has not done so. For 20 years, the public sector in this country, including local government, higher education and the national health service, were starved of resources. Hundreds of thousands of people were outsourced; jobs were sub-contracted to companies that aimed for the lowest common denominator and did not want to know about training, skills or the long-term agenda. Work force numbers, budgets and terms and conditions were cut to make things leaner and more efficient. As a result, public sector bodies could not fill the gap that we want them to fill. Hopefully, we are accepting in this debate that the public sector must do much more, and do it much better.
In the late 1980s, I left the mines. I was made redundant in 1989; when I left, I was given £20,000 in redundancy money. The global sum given to miners who were made redundant between the early 1980s and the early 1990s is £5 billion. I am talking about redundancy payments, and nothing else—not unemployment benefit or sickness benefit. If that money had been invested in keeping some mines open, or reinvested in skills, this country would be in a very different position today. I was fortunate, in a sense; through my involvement with the trade union movement—the Trades Union Congress and the National Union of Mineworkers—we got people access to Durham university. That gave people a chance to get skills, and to go back into education, if they had lost that chance earlier in life. That supported me and a few others.
I was one of the lucky ones; I was in the know. We cannot rely on that in this day and age. We need to go far beyond that, but we cannot do so if the Government have the attitude that we should stand back. We cannot do it if they believe in laissez-faire—if their attitude is "Stand or fall", "Only the strong will survive," or "If you don't like it, get on your bike." Sorry, but we cannot go there again. I am glad to say that we are not doing that today.
Sadly, like everyone else in the Chamber, I have constituents who are facing problems. Only last week, I visited Virgin Media in Team Valley in my constituency, where 113 people have been told that their jobs will have to go before next April. To its credit, the employer has engaged with those people at an early stage, and it has tried to find jobs for them in the rest of the system. More importantly, it has linked very quickly to the relevant agencies. Last week, I spoke to the Department for Work and Pensions, the local council and the regional development agency, which are working together with the employer to make sure that those people do not fall through the net. If they lose their job, they will try to find ways of giving them the skills to get another job, giving opportunities to people who may never have done a job interview or any training for years. The system is there to support them.
Likewise, as was announced by the Secretary of State, we are dealing with the situation at Nissan which, like other car plants, faces serious problems. It is the most productive car plant in Europe, producing quality goods and showing the way forward for manufacturing in this country. Like everyone else, it faces a situation where it has to lay people off. It has engaged with Gateshead college, which supplies the automotive training industry in my constituency, and it has agreed a package so that when people are laid off they do not go and sign on the dole or sit at home—they will go to the training centre and update their skills. Those same people in the training centre are going out into the workplace, and are working round the clock seven days a week with people to provide on-the-job training. They want to update their skills and make their chances better. For me, that sort of thing is welcome.
Twenty years ago this week, just down the river from Nissan, the last shipbuilding industry in Sunderland which, at one time, was the biggest shipbuilding town in the world, was closed down. A recording of what was said in interviews that day was released this week that said it all: when you take the heart out of something it dies, and the heart was ripped out of Sunderland when they shut the shipbuilding industry, with nothing to replace it. I urge everyone in the House to read "A mine of opportunities", the report produced last week by the Audit Commission which speaks about the key role that local councils play in regenerating coalfield communities. The key message is that the worst thing that happened was the lack of action in the 1980s and 1990s. There was a slow take-up of the fact that people were just left for a long time, which has led to long-term problems, including social problems and drug abuse. People are living in a welfare culture—something that they never wanted to happen. They were proud to go to work, but they have forgotten what it is like to get out of bed on a morning and go to work.
My hon. Friend referred to the car industry, and in North-West Leicestershire a good number of firms are car component manufacturers for companies such as Nissan and Toyota. In America, the big four car manufacturers are lobbying the case hard with President-elect Obama as well as President Bush for special support for the car industry as a central part of the economy. Indeed, Lord Mandelson has seemed to make similar noises here. Does my hon. Friend believe that that is the way ahead and, if so, how can support best be given by the Government to such central and core industries, off which many jobs hang in other parts of the country, not just in Sunderland, Derby or wherever?
My hon. Friend makes an apt point—that is exactly what I am talking about. We need input from people in different ways. The case for Nissan is different from the case for Honda or for Toyota. Right around the area, however, feeder factories may not be able to survive, unlike Nissan which, together with other big companies, can batten down the hatches. Companies that serve them, however, might not be able to do that. Part of our duty is to be the voice of people in Parliament, wherever we come from. If we believe that Ministers and the Chancellor are not doing their job or giving those people what they need, it is our job to come here, and bang on their doors and make sure that they know what we are saying.
To give a classic example, last week, a local business man asked me to go and see him. He is a successful man who wants to be even more successful. He has the opportunity to develop service stations up and down the motorway system. About nine months ago, he had the chance of a 100 per cent. loan from his bank. He is putting things in place, but it has now told him that it is giving him only 70 per cent., despite the fact that the businesses and the property that he owns would more than compensate if the business went belly-up, as the bank could claw all that back. At the same time, the bank told him that his overdraft charge would go from 13 per cent. to 17 per cent. That is a case that I shall certainly take up, on his behalf and on behalf of others like him. We must say to our Government, "You must put that right."
Finally, I turn to the subject of housing. I am glad that the Under-Secretary of State for Communities and Local Government, my hon. Friend Mr. Wright is on the Front Bench. Sarah Teather spoke about social housing and a number of hon. Members who were present agreed in principle with what she said, although we may have party political differences on the matter. There is a need for social housing, but there is also a great opportunity to do what our parents and grandparents did in the 1950s by regenerating areas and building quality social housing, not rubbish like the housing that was built in the 1960s.
We must build social housing that people want to live in and make homes in. We should be clear that that housing is there for ever for people who cannot afford to buy their houses. If people want to buy their houses, they should buy on the open market. Let us build social housing and use the rents over the next 50 or 100 years, whatever it takes, to pay back the money put into them. It is a long-term investment that will provide work—
I thank my hon. Friend for giving way and I strongly agree with every word that he is saying. I am sure that his town is similar to mine, where tens of thousands of houses were built in 1930s. Does he agree that it was construction that helped bring Britain out of the 1930s recession and that we should do that again?
My hon. Friend is right. That would be a new deal in the same sense as in the States in the 1930s, where public money was invested not just to get people through hard times, which is obviously the right thing to do, but to leave a legacy that lasts and meets a need. It is genuinely a win-win situation, as was said earlier by an Opposition Member. We should acknowledge that across the House and work together to take it forward. It would drive the economy, not just in construction—every house that was built would need to be fitted out with carpets, beds, settees and so on. The work is there for us to get stuck into, and I am keen to see that going forward. I hope that the Minister will give us some support in that respect.
My hon. Friend the Member for Glenrothes said that doing nothing was not an option for the Opposition. I believe that it is an option and that they should stick to it. They are good at it and they should do it for the rest of time, so that the people of this country refuse to elect them ever again.
May I, along with my hon. Friend Tony Baldry and Mr. Anderson, congratulate Lindsay Roy, who made his maiden speech this evening? It is a privilege, as he accepted, to be elected to the House, and I congratulate him on his election.
I join the hon. Gentleman in his praise for his predecessor, John MacDougall, whom I proudly claim to have been a friend of mine. We were colleagues on the Anglo-Netherlands all-party group. He was the chairman and I was the treasurer. We travelled to Holland and we met delegations from the Dutch Parliament here on a number of occasions over the past few years. I mourn with the hon. Gentleman and his constituents the loss of John MacDougall. He was a great man and a great servant of his constituency. The hon. Gentleman quite properly spoke of him this evening and I am delighted that he did so.
The hon. Gentleman said that he wanted to change the name of his constituency to Glenrothes County, I think. Perhaps I misunderstood him, in which case the remark that I am about to make will be even more laboured than the one I intended. Glen Roy might be the better name for his constituency, if Mr. Kennedy would allow him to use the name of a place in his constituency near Roy Bridge, near Spean Bridge in north-west Scotland. I congratulate the hon. Member for Glenrothes and wish him well. I trust that his remarks about the Prime Minister propel him or project him into the place where he no doubt wishes to be. It was a fine speech and I look forward to hearing more from him.
I return to the Queen's Speech. Although I shall concentrate on housing, I shall briefly mention another aspect that interests me, criminal justice policy. I want to discuss the way in which the Government are pushing their policy of building titan prisons—the large human warehouses that will incarcerate upwards of 2,500 inmates. They propose to build three of these, at the moment, in order to relieve prison overcrowding—a problem that they created and have made worse. Since they came to office in 1997, the prison population has risen from about 61,000 to some 83,500, and they have introduced a number of panic, reactive measures in order, as they see it, to deal with and mitigate the problems caused by prison overcrowding. Not one of them has worked. Since they introduced early release from custody on licence, far from the prison population going down, it has gone up. They have now come up with this hare-brained scheme to introduce titan prisons in Britain, which has been criticised right across the globe—in the United States and in Europe.
Today, Professor Bryan Stevenson of New York university gave a lecture in which he deprecated the Government's policy of introducing titan prisons and urged this country to learn the lessons of what has gone wrong in the United States. The US has huge prisons containing not just 2,500 but many thousands of prisoners, and they are very dangerous places. One need only look to today's experience at Her Majesty's young offender institution, in Aylesbury. It houses only 435 young men, yet there was an incident there today that the Ministry of Justice described as the result of "concerted indiscipline". That is probably new Labour-speak for "deep trouble". I dare say that not all 435 inmates were responsible for the concerted indiscipline, but it does not take much to spark trouble in a prison, and crowding people into big prisons and simply controlling the perimeter is asking for trouble. I urge the Government to think very carefully in this debate about what they do to deal with our overcrowded prisons.
I intervened on the Secretary of State earlier to urge him to do rather more about education in prisons. Although he said that there have been improvements, he was candid enough to accept that there is a lot more to do. That, if I may say so, is the understatement of the evening. The current state of the management of the education system in our prisons is wholly inadequate not because the prison staff are not doing their best—they are—but because prisoners are "churned" from prison to prison to prison. They barely get on to a course when they have to move. They barely get into that new prison when they are moved again, and their educational records, curriculum vitae and medical records—their drug, health and rehabilitation records—follow behind, probably two or three prisons after the individual prisoner. We are building in and reinforcing failure, and it is high time that the Government got beyond the departmental silos, so that adult education Ministers speak to Ministry of Justice Ministers and we have a sensible way of educating prisoners.
We should bear it in mind that many prisoners go into prison unable to read and write, and come out unable to read and write. One has to have a reading age of about 14 in order to get a job of any description nowadays in this country. Those without such a reading age cannot read the safety notices in factories or the instruction leaflets that machinists are required to get their heads round. We continue to allow a system that breeds lack of achievement and an inability to get a job, and which is ultimately responsible for the high reoffending rates that we see in the adult cohort, but—even worse—in the teenage cohort, as well. The reoffending rate among those under 18 is in the high 80s; among those of between 18 and 21, it is in the mid 70s. The reoffending rate among those over 21 leaving custody is about 66 per cent. within two years. We should not be proud of those figures; apart from anything else, they represent a total waste of public money. It costs £50,000 a year to keep each adult prisoner, and if they reoffend within two years, that is a waste of public money. The Government need to apply themselves rather more vigorously to that issue.
A few weeks ago, I was critical of the lack of meaningful activities in many adult prisons. I said that in some respects the prisons were Dickensian and that the activities that there were would have been recognised by Dickens's Magwitch. As a magistrate, I have visited the young offenders centre in Glen Parva, which is in the hon. and learned Gentleman's constituency. Do the criticisms that he rightly levels against the education and training situation in prisons apply a fortiori in respect of the younger prisoners, who do not necessarily lack skills for work, but lack skills for life and basic education—reading, writing and so on?
The hon. Gentleman is right; the issue applies across the piece. Education, in its widest sense, is not being given in the secure estate. My constituents employed at Glen Parva work their socks off in very difficult and sometimes dangerous circumstances. Not so long ago, a young man committed suicide there by setting fire to his mattress. He died from the burns. He put in danger not only his own life, but those of the officers who tried to get in to rescue him. Sadly, they were unable to save his life.
I do not wish to make tiresome party political points, because that is tedious. However, we are looking at a situation in which the lives of 83,500 people are being wasted. They have committed crimes, and many of them need to go to prison to keep us safe and so that they learn to lead more responsible lives. However, we miss an opportunity in incarcerating people in huge numbers and doing little with them once they are inside. Whether those people are youngsters or adults, the Government have a duty to the public to repair them—and, of course, to look after the victims of their crimes.
Does the hon. and learned Gentleman accept that there are prisoners who are unnecessarily retained in detention because the training courses that are a condition of their release are not available? That is another aspect that is feeding the spiral that he has been describing.
That is not a controversial thing to say. Unfortunately, there have been cases at the High Court in which those on indeterminate sentences for public protection have been unable to satisfy the licensing or parole authorities that they are safe for release, because they cannot get on to the courses that, if completed by them, might give some indication of their fitness for release.
I recently spent a day at Shrewsbury prison, which is officially the most overcrowded prison in England. I saw the extraordinary work that the governor, Mr. Hendry, is doing to rehabilitate prisoners there. However, the sheer numbers at the prison make rehabilitation very difficult.
I congratulate my hon. Friend on visiting the prison in his constituency. I always urge hon. Members to visit the prisons in their constituency—or, if there is none, the one nearest it. My hon. Friend Mr. Wilson is a frequent visitor to Reading prison— [Interruption.] I am in danger of taking myself too seriously. However, it is important that constituency Members visit prisons in their own constituencies; otherwise, the issue becomes a closed book and we invent public policies on criminal justice that are wholly inept and incapable of dealing with the problems that we face. I have two prisons in my constituency. I want to solve the problems I have identified for the benefit of my constituents—as taxpayers, as victims of crime, and as human beings who want the condition of people to be improved, not depressed by how we conduct this aspect of public policy.
I want to turn to housing—in particular, an aspect that was touched on by my hon. Friend the Member for Banbury. I can see that the Under-Secretary of State for Communities and Local Government, Mr. Wright, is really looking forward to what I have to say, because he is a keen student of my criticism of how the Government have handled the vexed and vexing subject of eco-towns. I have in my constituency a site that has been earmarked to some extent by the Government, but certainly by the Co-operative Wholesale Society, for the building of a new town of approximately 40,000 residents—about twice the size of Market Harborough, the biggest town in my constituency. In order to achieve this, the CWS, which owns approximately 5,000 acres of prime farmland in my constituency, wishes to convert that farmland into an eco-town. "Eco-town" sounds so much more attractive than "new town", but the fact is that the CWS would like to make a lot more money out of farming houses than it does out of farming crops. As a capitalist, I fully understand that it is entitled to make the best that it can out of its assets in order to return the money, if not to its shareholders, at least to its members. I know that Members of this House are members of the CWS and also members of its political branch, which I appreciate is a different organisation legally, although they are closely related.
In the city of Leicester and county of Leicestershire, there are about 10,000 empty dwellings, yet the Government seem backward in coming forward in encouraging the city council—most of the empty dwellings are in the city—to repair them to make them habitable. I am sure that financial and other instruments could be used to make it easier for private and public sector landlords in the city to bring those dwellings back into habitation. Equally, I am sure that the district councils that surround the city could be encouraged to bring back into habitation the lesser number of unused dwellings in the county. It is a waste of those 10,000 dwellings when there are, I am sure, plenty of people across the county and in the city who would like to go and live in them, particularly if they could be rented or bought at prices that they could afford. Unfortunately, that does not seem to be happening, and the CWS is crashing on like a bull in a china shop, demanding of the people in my constituency and that of my neighbour, my hon. Friend Alan Duncan, that it should be entitled to build this vast new town all over a piece of agricultural scenery.
Let me give an idea of the problem that we are up against. As I have said before—possibly in a debate responded to by the Under-Secretary—extracting facts out of the CWS is rather like extracting teeth. It is very reluctant to tell us precisely what it wants to do. I thought that I might get something out of it when, during the course of the summer, it produced a document—its piece of propaganda, or sales sheet—on its latest design for this town of 40,000 people. It described its vision in this way:
"The flexibility of the eco-town enables the desensification of residential plots that occur at an individual level, with the opportunity to create the value (rather than incur the cost) that this implies."
That is total balderdash. It means nothing. It is sales-speak and it will not get to grips with the real issue that concerns my constituents—the wholly inappropriate siting of a new town of 40,000 people in the middle of rural Leicestershire, which will have the following adverse consequences. It will suck the regeneration budget out of the city of Leicester, and I know that Keith Vaz and Sir Peter Soulsby, who are closest to my constituency, are concerned about that, and it will destroy the chance to give new life to the retail centre in Oadby, the part of my constituency closest to the city. Oadby lies directly between the new town and the city of Leicester. This town of 40,000 will knock out two perfectly good commercial centres: Oadby and the city of Leicester, as well as causing a massive drain of development money from those centres into the new town.
The new town will also cause the most appalling problems for transport infrastructure. If it goes through, the 40,000 people who will live there will need public transport and access to private vehicles, but both public and private vehicles need something to drive on. At the moment, the roads are already crowded, particularly during rush hour. The Co-op says, "Don't worry. Nobody will move out of this new town. They will all be so excited about living there that they will want to stay there. Indeed, all the jobs that we will create will encourage them to stay there." That is a nice thought, but I do not think that it will happen. The Co-op is also going to ensure that there is only one car park space for every two houses. That is wholly unrealistic, and it will cause trouble.
The Co-op hopes to persuade the Government to give it permission to push on with its ludicrous plan on the basis that it will build a tramway between the site of the eco-town and the city centre of Leicester. It has not been candid enough to tell us what the precise cost of that will be. Calculations vary between £1 million and £2 million per inch of tramway—that is an awful lot of money. I am not sure whether the Government will come up with the money to make the difference between the few hundreds of thousands of pounds that the Co-op says that it is prepared to give and the total cost. We will end up with a transport mess.
Of that 40,000 population, how will the adults who have to work get out of that new town to get to the main centres of business in the east midlands where jobs are to be found? Those 12,000 jobs will not arrive in this new eco-town just because the Co-op says it wants them. There will be massive overcrowding on the already overcrowded road system. It is 30 to 45 minutes from the site of the eco-town to the site of the most vibrant economic and job-creating development in Leicestershire by junction 21 of the M1, just south of the constituency of David Taylor, which is right on the boundary of the junction with the M69 and the M21. Only 300 jobs a year have been created in that area. On those figures, it will take about 50 years to create the new jobs needed in Pennbury; we are going to have to wait an awfully long time for those jobs.
I am concerned that the Government and the Co-op have been very unclear about the public sector funding needed to bridge the gap between what the Co-op says it will put in—in so far as it has given us any detail—and what will have to come from local and central Government. The section 106 agreements simply cannot be written, because we do not know what the Co-op will provide or what central and local government will be required to provide. We need detail if we are to engage sensibly and rationally with the bullying, which is what I call it, that we have seen from the Co-op.
Finally, I should like the Minister to give some indications in respect of the judicial review that has been granted in relation to the site at Middle Quinton in Warwickshire, just south of Stratford-on-Avon. In my area, the campaign against the Stoughton Co-op eco-town, or CASCET, is chaired by county councillor Dr. Kevin Feltham, who has been waging a highly effective and rational campaign against the Co-op and its madcap scheme. CASCET has sent a letter of formal support to the court in relation to the Middle Quinton review. Mr. Justice Collins granted that judicial review in September last year and I believe that the Government have granted a six-week extension, from February 2009, for responses to the latest consultation on the eco-town at Middle Quinton. That extension should apply to all the other applicant sites currently under discussion. If it does not apply to them all, let me urge the Minister to ensure that it should at least apply to the Co-op site in my constituency.
I apologise for speaking for so long, but in the Co-op application for a so-called eco-town—the misuse of language is just appalling, as one sees from the propaganda piece that I quoted a moment ago—the poverty of the language reflects the poverty of the case. None the less, my constituents' concern grows by the day, as the Government and the Co-op fail to understand the terrible threat that we face. I am grateful to the new Minister for Housing, who has agreed to meet me and my neighbouring parliamentarians at her Department, I believe on
It is a real pleasure to be the first fellow Scot in this debate to congratulate Lindsay Roy on his maiden speech, following his probably seminal victory—it was certainly a seminal by-election—of some time ago. Like everybody else in the House, I found his engaging contribution excellent and stimulating. The sense of balance in his temperament, which he brought to bear in the by-election, was with him in this debate and will be with him in the House generally.
I liked the hon. Gentleman's self-deprecating description of himself in the first few days here as "a lost soul around the parliamentary estate." Let us cast our minds back to those fevered times over the summer recess in the parliamentary Labour party. Had the result of the by-election been different, as it was widely anticipated at the outset, the lost soul wandering around the parliamentary estate might well have been the gentleman who is now his neighbouring constituency MP, the Prime Minister himself. There was a lot riding on that by-election, and it was a famous victory for the hon. Gentleman personally and for his party.
In congratulating the hon. Gentleman, as one Scot to another, let me say that one thing about the by-election that pleased me. The debate during the campaign and the outcome of the by-election, as well as his presence here this evening, as the new MP, and the presence of those of us from other political parties in Scottish and UK politics, demonstrate that one can certainly be a 100 per cent. nationalistic Scot without having to be a political nationalist. The voters of Glenrothes well understood that distinction and voted accordingly.
As has been quite widely remarked, this Queen's Speech is fairly thin in content, but I am one of those who have no great argument with that either philosophically or practically. I think that Governments and Oppositions consistently want to do too much and to interfere too much, so a Queen's Speech that does a little less is to be welcomed on principle alone.
Like others, I take the view that the Queen's Speech is lighter in content not least because of the general election calculations. This Parliament's legislative programme may have to be foreshortened if the Prime Minister decides at some point in the next calendar year that he can risk an early, or earlier than is absolutely necessary, general election. Who knows what will happen? It is idle speculation.
I am thoroughly of the view—and it is a view that the former Labour Home Secretary, Mr. Clarke expressed quite recently—that when one looks at the great advantage that is supposed to accrue to incumbent Prime Ministers from choosing the dates of general elections, one needs to remember that the history books tend to get written by the winners, so it is a great advantage when the incumbent benefits from it. It was not a great advantage for James Callaghan, for example, and it has not so far proved to be a great advantage for the present incumbent. If I were in his shoes, I would say that there will be no general election next year and that the Parliament will go through to the first week in May 2010 to coincide with the already scheduled local elections. Irrespective of the intervening consequences, that would settle the issue—at least in that respect—once and for all, so politics could conduct itself accordingly and much of the second half of the Parliament would not be so distracted by idle talk and idle general election speculation.
The Queen's Speech is lighter in content, but given the overwhelming financial and economic circumstances, which will determine the political content of this Parliament, I want to deal with it to a greater extent than any other time since my maiden speech 25 years ago by focusing on employment issues. When I was first elected 25 years ago, unemployment in my constituency was absolutely through the roof as a result of closures. For some streets and communities, adult male long-term unemployment was at more than 50 per cent—so thank God those days are behind us, we hope. What is back in focus, however, is the looming prospect—indeed, we are seeing it already right across the country—of very significant job losses becoming the order of the day once again. A big challenge for the Government, not just in respect of the Queen's Speech but for political conduct more generally, is how they respond to and cope with that prospect.
Let me begin by referring to an unemployment issue that has arisen in my own constituency. I make no apology for the fact that the number of jobs is very small or that the size of the community is very small, because everything is relative. The number of jobs available for this size of community is a highly significant issue. Like so many in my area, this community is remote, rural and heavily dependent on long-term employment prospects, some of which have been there for many decades. I am referring to the future of the silica sand mine in Lochaline in the Morvern peninsula in the Lochaber part of my constituency.
Lochaline has a population of 202 and we are talking about 11 full-time jobs, which Tarmac is likely to axe immediately before Christmas. The mine has a 60-year history in the community and its products have been associated throughout that time with many household names on both the national and international markets. A great deal of work is under way at all levels—in the community, at Highlands and Islands Enterprise, in my representations to Tarmac, and in the Scottish Executive in Edinburgh—and it would be assist if those efforts were reinforced by the Scotland Office and other Ministers making appropriate supportive noises. A further meeting in Fort William is scheduled for next Monday, and a report is due back from Highlands and Islands Enterprise on the current prospects for maintaining the mine. Given the company's premature announcement, which had scant regard for consultation or the sensitivity or interests of the community, we are looking for a stay of execution, a more careful and sensible consideration of the feedback—which will have been achieved in a short time scale, which is currently less than two weeks—and further discussion into the new year. Any help from the Government at a UK or Scotland Office level would be much appreciated.
Does the right hon. Gentleman agree that the consultation and need for a stay of execution that he describes should also apply to the 90 offices of Her Majesty's Revenue and Customs that are earmarked for closure by the Treasury? Does he also agree that those jobs on the front line of public services should be kept at a time when experienced and dedicated local staff are required for local services, including in my constituency of Crewe and Nantwich?
I thank the hon. Gentleman, and I congratulate him on his by-election victory of not that long ago. I must give credit where credit is due. With regard to the closures to which he refers, one was scheduled in another part of my constituency, Ullapool, but the Government have backed off. However, the alternative offices were, respectively, Wick, in the constituency of my hon. Friend John Thurso, and one of the two centres in Inverness, in the constituency of my other neighbouring parliamentary colleague, so it would have been ridiculous to reduce the presence in Ullapool. I welcome that fact.
A lot of work that was under way, and in the pipeline at a governmental level, has now been overtaken by economic events. The example cited by Mr. Timpson is one. The budget for Highlands and Islands Enterprise, although it comes within the purview of the Scottish Executive, has been cut by £50 million, and its purpose is to provide help in extremis. The budget decision was taken some time ago, but the financial situation has plummeted in the meantime, so some mechanisms of state support have been constrained just when they are needed. I therefore wish the hon. Gentleman luck with his ongoing campaign. The Government should listen to those in Crewe and Nantwich and constituencies across the country, where, sadly, such state support will be needed by citizens who already find themselves encountering hard economic circumstances. Alas, as we all know, they are liable to encounter even more of the same as 2009 progresses. I hope that the Government can take steps to assist with the problems of unemployment in Lochaline and in the wider community of Morvern.
On the Queen's Speech as a whole and employment prospects, transport and infrastructure considerations are important for the entire economy, but for an area as peripheral and remote from markets as the highlands and islands of Scotland, such considerations, as well as the cost of fuel, are vital. I welcomed some of the Chancellor's recent announcements in the pre-Budget statement—it has been renamed so many times that the correct nomenclature is difficult to remember—running in tandem with the Queen's Speech. However, it must be said that the impact on jobs in the highlands of Scotland of the continuing difficulties generated by fuel prices and the way in which the Government have set about their revenue take remains crippling.
I have mentioned one remote community, Lochaline, but another such community is Applecross, on the west coast of Ross-shire. The weekend before last, I was fortunate enough to be there and to observe that, thanks to tremendous efforts in that small and isolated community, the local petrol pumps had just been reopened as a result of the activities of the community and the Applecross community company. The company was able to raise enough funds to ensure that, when people needed to fill their tanks, they need not face—would you believe?—a 40-mile round trip to and from what were the nearest petrol pumps, in the metropolis known as Lochcarron, over the Bealach na Ba. If nothing has done so already, the mention of those place names will guarantee me an envelope from the Hansard reporters at the end of my speech!
However, it is not just access to fuel that is vital to a community of that kind. The cost is such that it inhibits everything else to do with creating jobs and maintaining them. People face longer journeys and higher prices, along with few if any alternatives. The Government must bear it in mind that power companies in this country have received £9 billion from the carbon emission trading scheme that they have not passed on to domestic energy consumers: something should be done about that before Christmas. Meanwhile, the Government are continuing to rake a considerable amount into the national Exchequer through the fuel costs that people are paying for their transport. All those factors have a massive inhibiting effect on the employment prospects of areas such as mine.
The third and final issue that I wish to raise is related to employment, although it falls within the housing field, and the United Kingdom housing field. I refer to the level of housing debt. Because it remains a Treasury matter, Members of Parliament in the Highland council area have been lobbying the Treasury for some time on the extent of the council's existing overhang in terms of housing debt.
The Treasury keeps citing the golden rule when it comes to trying to wipe out debt. For reasons that are well understood, the Government flaunted the golden rule in the context of the banking community; if they could do something similar in the context of a local authority such as Highland council, we might see the attainment of more Government objectives that are widely shared across the political spectrum.
The Government could invest in energy efficiency—in home insulation, for instance. They could bring about a welcome raising of social standards, and improve people's general welfare. However, a potential triple gain in the form of trades and skills—which are good for employment, overall energy policy and improved living standards—is being threatened. The lack of employment opportunities is all the worse at a time when we are losing jobs and will continue to lose jobs, but I have identified an affordable and efficient way in which the Government could generate growth in an area such as mine.
There is another way of doing that—partly through the Scottish Executive, but also through the Chancellor's welcome proposal in the pre-Budget report to front-load money over two years. Let me make a particular plea. In the context of geography and distance, the state of a main artery such as the A82, particularly between Glasgow and Fort William, remains an appalling indictment of present-day communications in a modern, developed country such as ours. Therefore, given that road's strategic UK importance for tourism and for shipping products generated locally south and out to European markets, any encouragement that the Scotland Office can give would be welcome.
Over the coming year, we will face a very hard time indeed in our employment prospects and the social impact they will have. Let us hope that, beyond the fairly thin content of this Queen's Speech, there is action that the Government can take.
I realise that many of the matters that we might address in this debate have been devolved to the Northern Ireland Assembly, but there are some points I would like to raise. In debating the matters before us, we could do worse than go all the way back to a previous Queen's Speech, when Her Majesty said:
"A stable economy is the foundation of a fair and prosperous society. My Government will continue to maintain low inflation, sound public finances and high employment."—[ Hansard, House of Lords, 15 November 2006; Vol. 687, c. 1.]
I will be generous to Labour Members by ignoring the obvious temptation to say that a stable economy is one that is not beset by boom and bust. However, although I will resist that temptation, I will point out that economic stability is foundational to almost everything else a Government might seek to do.
That brings me on to the issues of employment and skills. I spent almost 30 years building up my own company before I entered full-time politics—and I suppose there are those in Northern Ireland who would say that I would have been safer if I had stayed in business and not gone into politics, but we shall not elaborate on that. I know what it is to struggle and to work long, hard and unsocial hours to make a business a success. It is a bit like being an MP; the roles have a lot in common.
I started the company when I was a young man of 19. I was what one would call wet behind the ears, and I admit there were times when others in the business world took advantage of me and my family within that business because of my lack of experience. That was 30-odd years ago in Northern Ireland, and things were different there then. We did not have innovations such as training to be a business individual or entrepreneur. It was difficult, because things were hard in Northern Ireland, as all Members will know.
I noted what Lindsay Roy said about funding for science education. He is not in the Chamber at the moment, but I agree with what he said. More money needs to be invested in such skills; I will elaborate on that later.
Just last week, I met local business people in the Province, including representatives of a company that employs more than 40,000 people worldwide and has annual sales of about £5 billion. Many of their concerns are very similar to what I have encountered in a much smaller measure and are shared by business and employers across the United Kingdom. I am thinking, for example, of the sheer number of people who present themselves as potential employees without having even the most basic skills.
Dr. Iddon mentioned science funding. A large pharmaceutical company called Almac, which is based in my constituency, is considering developing a new site to employ some 300 to 400 young people—technicians and young scientists. In my recent meeting with the company, I discovered that it honestly does not know where it is going to get those people from, unless it looks to eastern Europe or the United States. We need to support and fund science courses in order to fill the gaps that exist across the whole of the United Kingdom in this area.
Education must be tailored to the needs of the workplace. There is absolutely no point in someone's going to university, getting an honours degree in karaoke singing or whatever, and then looking to get a job in the real world. Such an approach does not and cannot work, and those people will end up out of work. I hope that the proposed education and skills Bill and apprenticeship Bill will prove to be a step in the right direction—we shall wait and see. Apprenticeships should be embedded in the workplace and not left solely to the classroom.
This is not only about the skills of the prospective individual member of staff; it is about the skills of the company itself. Research and development uptake needs to be emphasised and prioritised. I have been struck by the absence of any recent mention of trade unions by those on the Government Benches and by the fact that trade unions were not mentioned in Her Majesty's Gracious Speech. We are told on a daily basis that the country faces a global economic crisis and that every part of the world is suffering because of what began in the USA. If that really is the case, and if it is true that the UK is facing into the same wind and storm as the rest of the world, surely we should seek to give ourselves every possible advantage over the rest of the world. In such circumstances, do trade union leaders not have an important role to assume?
My own constituency recently faced the possible loss of 120 jobs as a result of the threatened closure of the local offices of Her Majesty's Revenue and Customs. I lobbied Jane Kennedy, when she was Financial Secretary to the Treasury, and her successor, Mr. Timms, and I am pleased to say that those jobs have been saved. One of the key elements in that was the very positive campaigning on the part of the unions, and I want to commend them for their efforts in securing those jobs and ensuring that those 120 homes will be much happier over the Christmas period than they would have been otherwise. But it is not always like that.
As I have said, if what the Government tell us about the economic crisis is correct, we should give ourselves every possible advantage and that surely means that at the very highest level there must be a coming together of government, employers and trade unionists to agree that the first priority is to get through the current situation successfully. That is especially so given the many billions of pounds that the Government have thrown at the problem.
The Chancellor has recently outlined proposals in relation to tax and VAT that he is going to use as a temporary measure, and he has told us that it may well be the case that we shall all pay a bit more down the line. Well, if that is to be the case and if there is to be a bit of additional financial relief over the next couple of years, should not that be matched by trade union leaders making it clear that for the same period of time they will exercise caution in wage demands? If on the one hand the Chancellor is trying to ease the pressure on the economy, employers and jobs by taking the action he took, would the potential benefits not be increased by a reciprocal move by the unions? Would that not greatly assist business needs and be a positive contribution to employment prospects over coming months? After all, with unemployment at almost the 2 million mark and projected to rise as high as 3 million, I would imagine that trade unions would want to see their members remain in jobs rather than end up on the scrapheap.
A few moments ago, I used the phrase "business needs". In looking at the Government's programme as outlined in Her Majesty's Speech, I have to say that I am not convinced that business needs will necessarily be best served over the coming period. There are some positives, that is true. A female should be paid the same wage for doing the same job as a male. The gender pay gap needs to be closed and I hope that the equality proposals will achieve that end. But there are other measures that I fear will not have a positive effect. For example, the plan to further extend the right to request flexible working is fraught with negative potential. The fact of the matter is that while it will only be right to make the request, that right will come with a moral pressure on many small businesses. To me, it is simply not in the business needs to introduce this at this time.
Let us think, too, of the opportunities missed. While on the one hand the Government are intent on pushing through the flexible working proposals, they have failed to address the ongoing bureaucracy and regulation industry that has cost the country many billions of pounds over recent years—the very money that could have contributed to the Chancellor's financial stimulus package.
We know that as recently as last year the Government said that they would deliver 3 million new homes by 2020. Speaking in July 2007, the Prime Minister said:
"it is right, in the interests of good and open government and public debate, that each year the Prime Minister make a summer statement to the House so that initial thinking, previously private, can be the subject of widespread and informed public debate. Putting affordable housing within the reach of not just the few but the many is vital both to meeting individual aspirations and to securing a better future for our country".—[ Hansard, 11 July 2007; Vol. 462, c. 1449.]
He also said that the annual target would be raised from 200,000 to 240,000 new homes in England from 2016.
At the time, The Independent newspaper ran a headline that read "Brown's plans to build three million new homes 'will bankrupt social housing sector in five years'." The story quoted the National Housing Federation, which claimed that the Government's financial predictions were based on an assumption that housing associations would fund the work by taking out huge loans that, in fact, they would be unable to afford.
What became of those plans? How close are the Government to fulfilling that pledge? Of course, it could be argued that the crisis in social housing—for it was and is a crisis—was inherited by the Prime Minister from his predecessor, who saw the number of social houses built per year fall to just over 17,000. Be that as it may, the Prime Minister was still the Chancellor at the time and he is now the man in the hot seat. I remain to be convinced that the need for social and affordable housing will be met by any of the measures outlined by Her Majesty.
All in all, many people—whether they are members of the business community or in jobs that are at risk, are unemployed or homeless, or are young couples just starting out in life together—will feel short changed. I would be hard pressed to argue that they were unjustified for feeling that way.
Order. There are 44 minutes left before the wind-ups will begin and five hon. Members seek to occupy that time. Perhaps they will take a hint from that.
It is an honour to participate in this important debate. It is the usual debate that we have following the Queen's Speech, but we are certainly in unusual times. The content of the speech and the ideas and the vision displayed by the Government are under scrutiny and are all the more relevant as the scale of the recession becomes apparent.
Of course, this is the second opportunity that the Government have had to lay out their store following the pre-Budget statement, which was a chance to map the course that would be taken to weather the unsettled phase of this economic cycle. It has now become apparent that this is less about economic cycles and more about political cycles. As the dust settles, we see that Labour has provided £20 billion of savings but £40 billion of taxes. The cut in VAT is being seen and treated as a gimmick and there is no common sense in increasing taxes through national insurance at the very time when businesses want a reduction in taxes.
Rumour has it that the Chancellor will be back at the Dispatch Box in the not too distant future with another idea and will probably have to borrow more money, too. He will no doubt repeat the claim that the whole crisis started in the United States with the sub-prime market, but it was this Government who stripped the Bank of England of its historic ability to ensure that banking credit was kept within reasonable limits, this Government who allowed banks to offer massive loans and mortgages to those who could not afford them, and, of course, this Government who spent so much that they have no other choice than to borrow more money now. The result is an unsustainable debt-fuelled boom, followed by one of the biggest busts in history. I understand that the UK is now forecast to have the worst recession of all the G8 countries.
I mentioned in an intervention the other claim that the Prime Minister is keen to put forward, which is that other countries are copying the approach of weathering the recession with recapitalisation of the banks. That part is true, but whereas the £37 billion of taxpayers' money that the Government have lent to the banks has been lent at an annual coupon of 12 per cent., that figure was about 5 per cent. in Germany or the United States. At the same time, the Government are asking banks not only to hand those loans on to small businesses but to sort out their own debts. They cannot do both, and that is why the money is stuck and why it is not getting down to the small businesses.
We have touched a lot on employment, so it would be good to take stock after the monologue we heard from the Secretary of State. We would be forgiven for thinking that things were going well, but 5 million people are still on work benefits. Unemployment is rising and is at its highest for 11 years.
The debate stood adjourned (
Motion made, and Question put forthwith (
That at this day's sitting, proceedings on the Queen's Speech (Motion for an Address) may be proceeded with, though opposed, until 11 o'clock.— ( Ian Lucas.)
Question agreed to.
Debate accordingly resumed.
Question again proposed
Two in three of all jobs created are in the public sector, according to the Financial Times today. Four in five jobs created by the Government have been given to migrant workers.
We had a brief discussion about the importance of level 3 apprenticeships. The number is down and has been falling for the last seven years, yet those apprenticeships are critical in supporting businesses' employment and training needs. The Government are not taking us in the right direction.
More important is the worrying cultural change and the attitude of today's youth towards work. A small but increasing number of people are growing up to believe that it is acceptable to live off the state. The economic and social significance of that is extremely serious. With limited ambitions, people do not gain educational qualifications to the same standard, skills are not obtained and the capability of the work force is diminished. If there is one failure that hangs round the neck of the new Labour project, it is that it has overseen a generation's declining aspiration in favour of the expectation of state support. It has never been easier for Britons to be sponsored by Government to do nothing. That is a sad indictment of where we are today. It not only costs the state more in increased handouts, but there is a loss of potential income tax, which means less money for the Government to inject in the economy.
An area of the economy that is suffering, and has not been mentioned yet, is tourism. It is Britain's fifth biggest industry and of huge importance. It generates revenue of about £90 billion a year and is considered the hidden giant of our economy. Tourism is twice the size of the IT sector and four times the size of the agricultural sector, yet it is rarely mentioned. It is responsible for one in four of the new jobs created in the UK, and with 30 million visitors to the UK every year we are the sixth most popular country in international tourist tables—something of which we can be very proud indeed.
The recession is not just affecting businesses through the banking crisis, but also because fewer people are choosing to holiday and to travel from abroad to seek work in the service industries. Labour is ignoring the problems of the tourism industry. When I asked the Minister with responsibility for tourism when she last had conversations with her counterparts in the Departments for Transport and for Business, Enterprise and Regulatory Reform, and indeed the Treasury, I found that such meetings never happen. No one in the Government is looking after tourism from the Government perspective.
To make matters worse, a complicated and confusing structure is compounded by devolution. Visit Scotland does its own thing, as do Visit Wales and Visit England. Regional development agencies disperse responsibility for tourism around nine regions, to the point that in Boston, Massachusetts there are separate offices for six RDAs representing different corners of Britain, all trying to attract people to the UK. How mad is that? There is overlap that needs to be addressed, but it has not been done because no one in the Government is taking responsibility.
Another example of poor co-ordination is between the Home Office and the tourism industry. Visa costs have jumped by 130 per cent. according to the Tourism Alliance, which has led to a loss of about £160 million a year. That is bad enough, but if we look at who is coming to Britain, we see that although there were 100,000 applications for British visas from China last year, France and Germany receive 500,000 tourists from China every year. That is simply because the visa for those countries is so much cheaper.
Heathrow is another great example of a failure of co-ordination between Departments to ensure that the gateway to Britain is something of which we can be proud. The Heathrow experience is now listed as most business people's first bad impression of Great Britain, yet no one takes responsibility for co-ordinating all the agencies, organisations and Government Departments so that we can try to correct that.
A recent report by Deloitte shows that there is an absence of proper Government support that would allow the United Kingdom to punch above its weight when it comes to tourism. The last tourism Bill to pass through Parliament did so in 1969. We are overdue an assessment of where British tourism stands. One industry that could have been helped is the pub industry. I am sure that you, Mr. Deputy Speaker, are a supporter of your local traditional pub, as many of us are. It is in such pubs that responsible drinking takes place. Sadly, 36 of those traditional pubs shut every week. Once they are closed, they are gone for good.
What have the Government done to help those pubs? They decided to increase duty on alcohol. There are reasons why they did that, to do with tackling the booze culture, but the move affects traditional pubs across the board. Apparently, duties have gone up to negate the reduction in VAT, but when VAT goes back up again next year, will duties go back down? No. It is yet another whammy that will hit our traditional pubs.
The reduction in VAT is viewed as a joke. Many small and medium-sized businesses in the tourism industry are already offering 15 per cent. discounts, so reducing VAT by 1, 2 or 3 per cent. is negligible; it has no impact whatever. The administrative changes needed to show the reduction in VAT will cost each retailer an average of about £2,300—and the change is to be for just one year. Tourism is important to Britain, yet we are not harnessing the opportunities that British tourism could provide. That attitude will not change until the Government start to appreciate this £90 billion industry, which accounts for 1.4 million full-time employees—that is 7 per cent. of the work force—and 200,000 small and medium-sized businesses.
I shall conclude, because I know that time is against us. We enter the stormy seas of this recession poorly prepared, and we are all the more exposed as a result of failure to navigate the quickest course out of it. Instead of assisting small businesses, we are burdening them with higher taxes. Instead of helping banks to provide loans, the Government are loaning taxpayers' money to banks at 12 per cent. interest, which means that there is no liquidity to pass on. Instead of harnessing the full economic potential of the next generation, the Government are fuelling a cultural shift towards mediocrity.
I fear that only a change in Government will invigorate people and bring about the seismic shift that is needed to reverse that flawed attitude. I hope that after that change, we will be able to rejuvenate the next generation, so that they stay in school until they are 18 not just because the Government tell them to, but because they want to; so that they seek a job not because otherwise they will lose their benefit, but because they have a skill on which they can build, that gives them a good salary and of which they can be proud. For the sake of Britain, the sooner the next general election is called, the better.
Thank you, Mr. Deputy Speaker, for allowing me to contribute briefly to this important debate on issues that are ever more relevant. In the six months for which I have had the honour of representing the people of Crewe and Nantwich, the issue of employment has never been far away. As the weeks have progressed, the issue has become more and more pressing.
I am sure that none of us in the House wishes to see our constituents struggle as a result of losing their job or livelihood, and I am sure that we all do what we can to prevent that from happening, but one of the harsh realities of a recession is large-scale unemployment, and that seems particularly to be the case in this recession. A Local Government Association report suggests that there will be 230,000 job losses in the north-west by December 2010. In Crewe, there have been recent job losses in the public sector. There is the closure of local post offices and the imminent closure of the Royal Mail sorting office, with the loss of 600 jobs. As of last week, the third-largest Her Majesty's Revenue and Customs office in the north-west was to close, with a loss of up to 80 jobs. In the private sector, the car, manufacturing and retail industries are all prominent, with the likes of Bentley, Bombardier, Focus DIY, Woolworths, MFI and others all feeling the crunch in the current conditions, which will have a significant impact on the local economy.
Crewe is synonymous with the rail and motor industries, which continue to provide the backbone of the local job market together with, in more recent years, the retail and service sectors. As the recession bites, there is an opportunity not only to secure the short-term survival of those industries and businesses but to prepare them for long-term sustainable recovery. I agree with the Government, albeit not necessarily on their suggested implementation, that we have been presented with an opportune moment to invest in the training and skills necessary to see us through the short and the long term. There is a huge dearth of skills, particularly in the engineering sector, which has been recognised by the Secretary of State himself. In Crewe, Bentley has 3,500 employees, and runs a successful apprenticeship scheme that it intends to expand, despite the downturn. Bombardier, LNWR, Freightline and other railway industries that are part of the Crewe railway network have waited a long time to ensure that their apprenticeship schemes are full, and they all have long waiting lists of people who want to join the industry.
"The challenge we face is that within the next decade, large numbers of unskilled jobs will be replaced by high-skilled ones. We must ensure that the north-west workforce is not left behind."
That is precisely why, with others—I am glad to see the Under-Secretary of State for Innovation, Universities and Skills, Mr. Simon, on the Front Bench, as he was involved in the Westminster Hall debate on the issue—I have advocated the overwhelming case for a national railway skills academy in Crewe that is employer-led and meets the short and long-term needs of an industry that is getting back on its feet and is on the rise. This could not be a better moment, from the Government's perspective and for the Opposition, for such an initiative to be put into practice.
Not all the employment difficulties are a direct result of the downturn. The public sector work force in Crewe have been hit hard by the closures that have been announced of the Royal Mail sorting office and the HMRC office, both of which are unconnected to the credit crunch. Both consultations began before the economic crisis, yet the Government have seen fit to continue with that folly, despite the need for those jobs in future. As a consequence of the independent Lyons review of public sector relocation, the Government recognised the need for the transfer of civil service jobs from London and the south-east to the regions, and the review said:
"The Government is committed to improving the efficient delivery of public services, boosting regional economic growth and bringing government closer to the people, through greater decentralisation and devolution."
By making those announcements on HMRC and Royal Mail in Crewe, however, they have done the exact opposite. They have started to centralise those systems, taking away local jobs and services at a time at which they are most needed.
In July 2003, the then Minister for Employment and Learning said that
"recent job losses in the north-west make co-ordinating the response by Government, education providers and local communities essential".
It appears in Crewe, however, that the Government have not learned that lesson, and good-quality public sector jobs have been lost, with no proper consultation with the local community. Along with that, there is a loss of valuable local knowledge and expertise, which will have a direct effect on local families and businesses.
The two Government Departments responsible for the restructuring of both Royal Mail and HMRC worked independently of each other, with no apparent thought given to the overall consequences for the local economy, which flies in the face of the concept of joined-up government and of a co-ordinated approach.
The Government's response to the vehement and united campaign to keep open the HMRC office in Crewe was particularly depressing for two reasons. First, by moving local public services away from local people, the Government are doing the exact opposite of the commitment given in response to the Lyons review. Secondly, by not pursuing a local strategy to deal with the recession, places such as Crewe are being hit disproportionately. In a town that still relies heavily on its manufacturing and motor industries, the opportunity to keep efficient, dedicated, valuable, local public sector staff in work has been missed. That would have softened the blow and given the local economy of Crewe and Nantwich the platform on which to rebuild. It is not too late for both Government Departments to grab that opportunity.
It is always a joy to sit in on debates and hear so many speeches from hon. Members in all parts of the House who bring to bear what is happening in their constituencies. Mr. Timpson did exactly that from his own perspective.
I was struck earlier by the comments of Dr. Iddon when, as he always does in the House, he gave a staunch and steadfast defence of British science and argued strongly for continued investment in it. His comment about what we should not do during the recession was interesting. If one point that I make tonight should be taken on board it is that we must not cut back our investment in science, particularly in basic research. It is basic research that creates the bullets to fire at wealth creation, with the advantages that that brings.
There was a suggestion in the hon. Gentleman's comments that there is a dichotomy between basic research, and translational research and wealth creation. We must not make that mistake. I said earlier in an intervention on the Secretary of State that last Monday I was at Honda Formula 1 at Brackley, not knowing that a week later it would be up for sale. Speaking to the great engineers operating at Honda Formula 1, it was interesting to learn that they are developing cutting-edge technologies, which must be changed from race to race in order to compete and to shave a fraction of a second off a race time. One of the most impressive elements that right hon. and hon. Members who visited the site were shown was a new composite gearbox. Nobody believed that a gearbox could ever be made from composite materials. The conventional technology is to make it out of some alloy or steel material, but that is extremely heavy. The composite gearbox was developed as a piece of technology purely in order to drive down the weight of a car so that it could go faster.
The point of bringing this development to the attention of the House is that the technology could have the most profound effect by reducing costs in the motor industry and the transport industry, because as soon as the weight of the gearbox of a bus or a truck is reduced using composite materials, there are massive savings in energy use by those vehicles. Yet when we were speaking to Ross Brawn, the chief engineer at Honda Formula 1, it emerged that no member of the Government had ever been to see how those technologies could be transferred—although, to be fair, the technology strategy board had had a meeting at Brackley just a few months earlier. It is rather sad that the technology strategy board goes, Members of the House of Commons go, and then Honda Formula 1 closes.
Technology transfer does not simply come out of universities into companies. It also comes from companies into other companies and into universities. It is a cyclical process, rather than a straightforward linear one. I am delighted that the debate this evening has concentrated on skills and that through the Bill in the Queen's Speech, the Government continue to argue that skills are at the heart of productivity and at the heart of the agenda, and that we must not take our eye off the ball.
Every single inquiry that I have been involved in since becoming the Chairman of the Science and Technology Committee, and now the Innovation, Universities, Science and Skills Committee, comes back to a fundamental issue: we are not producing enough young people with science, technology, engineering and maths backgrounds to become the wealth creators of tomorrow. That point was made by David Simpson, who is no longer in his place. Every business we speak to says exactly the same thing, and every university makes the same claim.
According to the Royal Society's research, during the whole of the period between 1996 and 2007, less than 12 per cent. of all the children who left our schools took an A-level in biology or maths, less than 7 per cent. took one in chemistry and less than 6 per cent. took one in physics. As we have seen as the bubble has burst, we cannot rely on a service-led economy, a large proportion of which is dependent on financial services, and simply believe that in that way we can pay our way as a nation in the 21st century. We have got to start making and manufacturing things again, and to do that we have to have a stem base. There is nothing in this new Bill, other than structures, to deal with the underlying problems with our economy.
The Leitch agenda underpins much of the Government's thinking, and Lord Leitch's report was an excellent analysis of where we were going, but it was a 2004 to 2006 analysis. To be fair, the Government's response was to accept Lord Leitch's recommendations, but his report is all about upskilling and qualifications. The idea that qualifications equal skills, equals productivity is in my view a flawed equation. We need to look again at Leitch. Yes, we should deal with his analysis, but the Government should have the courage to recognise that if, by this time next year, there are 3 million unemployed—God forbid that we ever get to that state—it is not the NEET group, those not in education, employment or training, who are of the greatest significance to our economy and nation; it is the 3 million who were in work but are no longer, and who need not simply upskilling but reskilling. That is at the heart of what the Government should be concentrating on in the Bill, when it is amended.
I compliment the Government on the issue of apprenticeships, however, which is dealt with in the Bill. I do not want to argue about whether apprenticeships were better in the past or there is a greater vision now. The reality is that this is the first Government during my lifetime who have said on education and skills training, "Let us have a target of 400,000 apprentices by 2020." I do not believe that they can possibly get to 400,000 quality apprenticeships by 2020, but it is an objective worth pursuing. We must not pursue it, however, simply as a quantity target. If we do not ensure that those apprenticeships are of a high standard—if we dumb down the brand—we will do far more to disadvantage people following apprenticeships than before.
I ask the Minister please not to get hung up on the issue of making an offer. Simply saying to tens of thousands of young people, "We will guarantee you under the law an offer of two apprenticeships, provided that you have the relevant qualifications", is not achievable, in my view. It is a laudable objective, but translating it into law means that targets will have to be manipulated in order to be met, which would be wrong. We have to have more employers involved in apprenticeships. In the boom times, one in 10 employers has engaged with apprenticeships. Why on earth will they do so in the down times when, traditionally, training is one of the things to be cut? My plea to the Minister is to be realistic when he starts putting this proposal into operation. He will get the support of the House if he does not get hung up on false targets, and if he is realistic about his objectives. Members on both sides of the House want the Government to succeed in the skills agenda, where frankly, we have all failed in the past.
The Government paint a rosy picture of apprenticeships and of the skills of the nation as a whole. However, there is a great difference between the picture given for external consumption abroad and what the statistics say at home. According to the UK Trade and Investment website, we should wonder why we need this debate at all. Having said that employment is at a record level, it goes on:
"The strong skills base in the UK is reflected in its excellent record of attracting major foreign investors".
Perhaps the website has not been updated for some time, but the reality is somewhat different. Many businesses find it difficult to find staff with the right skills. Five million adults are functionally illiterate and 17 million have basic numeracy problems.
Local companies do not need to be told by the Government about the benefit of apprenticeships. Having visited a number of companies in my constituency, including manufacturing and engineering companies, I can say that they know the benefits of apprenticeships all too well. Indeed, at one company the managing director had come up by just that route; he praised his apprenticeship not only for the engineering skills but for the general business skills that it had given him. He became able to see the perspective of the business as a whole, which made him confident enough to carry on as managing director.
Many of the businesses that I have mentioned have recently run apprenticeships; such businesses are in the best position to know what type of apprenticeships they need and when in their own business cycles apprenticeships should be taken on. They do not need to be strong-armed into apprenticeships, but for now they are preoccupied with the banks' withdrawal of facilities, the increase in national insurance, the management of cash flows and the staving off of making redundancies among long-serving, already skilled staff. They are battling to try to keep the jobs that they have.
The Government talk of demand-led apprenticeships, but clearly they see demand from only one side—that of the individual. Demand also needs to be understood from the company side. Good apprenticeship schemes cannot be conducted in isolation from businesses, but should work with businesses. Hopefully, local learning and skills partnerships provide a route for that. My county council, of which I am still a member, has ensured that its learning and skills partnership is led by a senior local business man, and it is all the better for that. However, businesses—even small and medium-sized enterprises—are not resistant to training. I recent visited a training provider, Henley college, in my constituency, and its representatives were full of praise for how local SMEs were committed to training and employment way beyond the apprenticeship. However, there is a need for business flexibility so that SMEs can choose the best route for themselves. That route will change over time.
The public sector is not as behind as the Government like to make out. What they say might be true of Whitehall, but the Minister may like to consider the case of some local councils. My county council now has about 50 apprenticeships, ranging from social care to outdoor education to civil education and some administrative areas.
With respect, it is Mr. Willetts who is not being clear. On at least two occasions when opening the debate he referred to the fact that there were about 3,200 apprenticeships—I cannot remember the exact figure—in central Government. That is a low figure, but it relates only to central Government. He completely overlooked what my right hon. Friend the Secretary of State for Innovation, Universities and Skills and I said about apprenticeships in local government, which have also been mentioned by John Howell, and about apprenticeships in the NHS.
I am sure that my hon. Friends on the Front Bench appreciate the role played by local government in apprenticeships.
I am encouraged that local groups of SMEs are coming together to consider the provision of support and training as a group, often on a self-help, mutual basis. That is certainly happening in my constituency. However, business is suspicious of Government involvement in apprenticeships and training for good reason. The Train to Gain exercise is widely seen as a one-size-fits-all approach that takes no account of the specific needs of areas, even within an area such as a constituency, and it is widely seen as complex and confusing. Furthermore, there are doubts about whether it adds anything new and whether there is any real test of additionality in what it delivers.
No one will miss the Learning and Skills Council, but there is no confidence that what replaces it will be any better. After all, its constant reform has been described by the general director of the British Chambers of Commerce as a constant reshuffling of deck chairs that has held back progress in vocational qualifications. There is no confidence that the Government will be able to simplify matters or avoid interference. Even where there has been a transfer of funds to local government, one need only see the constant stream of circulars and departmental memos that hit the desks of almost all senior council officers to realise that the Government regard local government as nothing more than their own local Executive arm. We need to ensure that bureaucracy is genuinely removed.
Let me turn finally to the provision of employment training. The Government have consistently missed the point as regards the difficulty of providing skills and employment services in a rural environment. A rural environment involves greater expense. Fewer providers operate in it, there is less choice for the individual, and there is almost no travel to get about in order to do the training. That has an impact on the job prospects of some of the most vulnerable people. Let me give two examples from my own constituency that arose as recently as last week.
A training and support consultancy for horticulturalists, which is doing extremely good work with people with various disabilities, is likely to have great difficulties in continuing because of the burdens placed on it as a result of the shake-up of procurement within the Government. If it does continue, there is likely to be a reduction in the amount of time that people with disabilities spend on individual modules in the training schemes. That is a great shame, because this is an example of tackling the barriers that people face while providing them with real experience.
The second example concerns ex-offenders in my constituency—even Henley has some ex-offenders—who have been ordered to get on to courses but have to go as far as Oxford. That may not seem a huge distance to Members, but it is a very tortuous route. The buses do not run on time, and it may be necessary to take several different ones. The scheme is designed for failure. That is not how we should proceed. The Government need to acknowledge that the rural dimension is special and that we need to take that into account.
I do not have long, but it would be remiss of me not to commend the maiden speech by Lindsay Roy, which was assured and witty. Let me also put on record my strong support for what my hon. Friend Sarah Teather said from the Front Bench about housing. I want to address my remarks to the quantity and quality of housing.
David Simpson said that the Government's intentions as regards the quantity of housing have been seriously undermined over the past six months. The small amount of social housing as well as a catastrophic fall in the private housing sector interact with the quality of housing. In England, we have the most expensive housing, the smallest number of houses in relation to households, and the worst quality of housing environmentally and otherwise. Housing produces 27 per cent. of this country's carbon dioxide emissions. The central point that I want to make to the Government is that as this recession develops, they will be strongly tempted to chase the quantity of housing and to sacrifice its quality. I urge the Minister not to do that. We have some 20 million homes at the moment, and at the current rate of building, 80 per cent. of them will still be there in 2050. If we got back to the level that the Prime Minister talked about in July, 70 per cent. of housing in 2050 would already have been built. We need new policies to ensure that new housing, including new social housing, is built to the very highest standards, but we also need to ensure that we tackle the problems with the existing stock. We need policies not just for the new housing, but for the 80 per cent. of it that will still be there in 25 years' time. We need policies that cut carbon dioxide emissions, cut people's bills and reduce fuel poverty. The Chancellor has said that he will do whatever it takes to tackle the recession, and I say to the Under-Secretary and the Government that tackling the problems associated with the existing housing stock would be a good four-way hit—cutting carbon dioxide, cutting people's bills, cutting fuel poverty and providing jobs. The retrofitting of energy-saving measures to existing housing ought to be high on the agenda. That process would be assisted by a cut in VAT for alterations and renovations, which in turn would end the paradox of it costing more to alter buildings than to build new ones.
We need legislative changes as well, and the process is not that difficult given that the law is already in place. I say without any shame that I promoted the Sustainable and Secure Buildings Act, which received Royal Assent in September 2004. That Act provides the Government with the levers they need to bring new buildings up to standard to tackle climate change, to allow for the alteration and repair of existing homes and to improve building standards in existing housing stock. One of the current paradoxes is that someone replacing a roof put on in the 1960s is required to do so only to the environmental standards of the 1960s. Many people would say that that was absurd. The process does not require zillions of pounds of public cash, but the Under-Secretary must implement the provisions of the Sustainable and Secure Buildings Act, which the Government and all parties supported in 2004.
My plea is that the Government should not chase housing numbers at the expense of sound environmental quality, and that they should make a resolute start—albeit an unnecessary four years late—on getting existing homes properly insulated and updated. They should tackle climate change, secure more jobs, tackle fuel poverty and give people well-being in their homes.
This has certainly been a wide-ranging debate, and hon. Members on both sides have brought to bear a considerable wealth of experience from their constituencies and their backgrounds, which was an advantage. For that reason, and because of the time constraints, I hope that Members will forgive me if I do not go into detail about all of their points. I would like, however, to join hon. Members in congratulating Lindsay Roy on an excellent and well-received maiden speech. It was not that long ago that I, as a by-election entrant to this House, was in the same position. We all wish him well, and hope to hear from him again in the future.
It was apparent that a common theme ran through both elements of the debate—a litany of failure on the part of Government policy on skills and housing. My hon. Friend Mr. Willetts dealt with skills at some length in his opening speech, and I will therefore not go into as much detail on that topic as I will on housing. It is important to reinforce, however, that evidence introduced by hon. Members strongly supported my hon. Friend's point. In the skills agenda, we suffer from a huge over-engineering and complexity in the systems for delivering desirable objectives. There are more funding streams and agencies than one would find in the wiring diagram for a modest-sized cruise missile. No wonder it is difficult for those seeking to enter the skills system—never mind businesses—to navigate. Greater simplicity and clarity would be a huge advantage, hence my party's proposals to concentrate heavily on apprenticeships, which have been referred to repeatedly in this debate, and to ensure an emphasis on practical learning, vocational skills and the needs of business, particularly small and medium-sized businesses. I am afraid that the Department for Innovation, Universities and Skills does not seem to have learned that lesson.
On housing, DIUS and the Department for Communities and Local Government at least share one thing in common: they seem almost to be in a competition to see how many initiatives and pledges can be abandoned. It is a bit like a competition between Elizabeth Taylor and Zsa Zsa Gabor to see who has the most discarded wedding rings on their dressing table. [ Interruption. ] I know that it was a long time ago for the Under-Secretary, but I am sure that he will have read about it in a history book. If he goes back to Madonna, perhaps he will get the same flavour, but it would be good for him to go back a little further.
Let me remind the Minister of some issues closer to home. We have seen the collapse of delivery in the Government's housing policy. The root of all our problems is that not enough homes are being built and it is this Government who are failing to build them. On average, 31,000 fewer homes are being built a year than under the previous Conservative Government. Fewer affordable homes are being built. Not once in all these years have the Government built as many affordable homes, which are at the sharp end of need, as were built in any equivalent year under the Major and Thatcher Governments. That is a lamentable failure of the most vulnerable and the most in need.
The private housing sector has also been subject to failure. No wonder there is so much legitimate concern about repossessions, to which hon. Members have referred. Why is that such a difficulty? Not only is there a lack of supply arising from the Government's policies, but the explosion of easy credit exacerbated the problem and pumped up the housing market in an unsustainable fashion. Who is responsible for driving that? [ Interruption. ] It is no one on the Conservative Benches, as Rob Marris well knows, but the Prime Minister, first as Chancellor of the Exchequer and now as Head of Government. Who personally removed the Bank of England's power to call time on bank lending and who stoked up an unsustainable housing boom? It was the Prime Minister. Now that the consequences are coming home, it is ordinary hard-working families who are having to bear the brunt.
Abandoned ideas litter the Department for Communities and Local Government a bit like the abandoned gun carriages that littered the road from Moscow back to Paris in 1812. There has been a full-scale retreat by the Government on those policy issues.
We could probably have read "War and Peace" in this debate.
Hon. Members will remember that there used to be a target to build 3 million homes by 2020. Then it ceased to be a target and became an ambition. What happens to a target that becomes an ambition? It becomes an aspiration. Now I read from the new Minister for Housing that the ambition has become a challenge. What it comes to is this: a target that becomes an ambition, which then becomes an aspiration, which then becomes a challenge, turns out to be a pipe dream and a confidence trick on the British people.
The Government have dropped another target, on eco-towns, to which my hon. and learned Friend Mr. Garnier referred. That target, too, is now an ambition and will become an aspiration and then a challenge, so at least the Government are consistent in the methodology and the words that they use. That is a skill that they have acquired at any rate, and we should be grateful for that.
Finally, there is the social homeBuy scheme, which relates to a matter of real concern. People who are struggling to keep their homes are subject to acute pressure, but what did we get to address that? We got a particularly cruel situation. Hopes were raised by a scheme that it was said would assist some 10,000 families over two years, but how many families have in fact been helped? At this time of particular need, 235 families have been helped. That is a shameful and abject failure by the Government in the very years when one would have thought that they would have more to do. Ministers must understand that the failure of the social homeBuy scheme naturally makes the public hugely sceptical about the latest initiative to assist people with mortgage arrears.
Once again, that latest initiative is an interesting scheme. We were first told by the Prime Minister with his usual hyperbole that all the major lenders had signed up, only to find that just two had gone into any detail about the assistance to be offered. As everyone said, it is only by seeing the devil in the detail that we can understand the concerns about the scheme.
What is sad is the real lack of initiative and the real lack of joined-up government. As Members have said, we are facing a recession that will test our economic resilience to the utmost. That is why the skills agenda is so important and why focus and determination are so important. The recession will test our social fabric to the utmost and nowhere is that more apparent than in housing. The Government's lack of imagination and their willingness to fall back on soundbites are things that the British people will not forget.
Housing is one of the greatest concerns of the British people. They work hard, they hope for and have an aspiration to have a decent home: it is the most basic of natural instincts. When the Government offer up ideas that they then casually abandon in a serial manner, it is no wonder that people lose confidence in what they can do and achieve. This is not the only instance where we have seen that problem, as we also saw it in the past. Once again, the Government are behaving in a way that causes the British people to lose faith—not in the Government themselves, although they certainly will in time, but sadly in the institutions of democracy. That is a serious failure of the Government in respect of the trust that people have placed in them. There is still time, if they could only get their act together, to do something constructive. On current form, however, what we are going to get is yet more spin, yet more soundbites and complete inaction on a key area of policy.
I begin by joining Robert Neill in paying tribute to all the contributions to tonight's debate. Hon. Members brought their experience, knowledge and considerable expertise to bear on the debate, which greatly benefited from it.
I start by paying particular tribute to my hon. Friend Lindsay Roy for his high-quality, witty and insightful speech. I have a great deal of affection for hon. Members who come here following by-elections. The hon. Member for Bromley and Chislehurst did that, and I did so about four years ago as a result of the previous MP representing Hartlepool, my noble Friend Lord Mandelson, moving away, although I do not really know what happened to that individual! After 11 years of a Labour Government and with the biggest financial turbulence the world has seen since the first world war, it is striking that my hon. Friend the Member for Glenrothes was able to win that by-election—and win it so decisively. That is testimony, first, to the policies that the Government are advancing and, secondly, to the personal qualities of my hon. Friend. He comes to the House with a formidable reputation in matters of education and skills; on the basis of his speech tonight, I am sure that we shall hear a lot more of him. He will be a true asset to this place.
Mr. Willetts displayed his usual smooth and articulate manner to the House, but I have to say with the greatest respect to him that he was somewhat complacent and disparaging about the success of a generation of young learners. He mentioned the importance of freedoms that incorporation in the 1990s brought to further education colleges in his area and others—and they were quite rightly welcomed, so I fully agree with him about that. He failed to mention, however, that FE colleges were not quite so grateful for the cut in sector funding—by 7 per cent. in real terms—during the four years up to 1997 or for the fact that earmarked expenditure on FE capital under the Major Government came to a grand total of zero. Public investment in adult skills since 1997, in contrast, has been transformed. It has increased from £3.8 billion in 2002-03 to £4.7 billion in 2008-09 and is planned to increase to £4.9 billion in 2009-10.
The UK has made strong progress in recent years, particularly in helping those with the lowest skills. Apprenticeship starts have increased from 65,000 in 1996-97, as my right hon. Friend the Secretary of State mentioned, to 184,000 in 2006-07. Crucially, the number of people completing apprenticeships has trebled. In England, the proportion of people of working age with no qualifications has fallen by almost 6 percentage points from more than 17 per cent. in 1997 to more than 11 per cent. in 2007. About 75 per cent. of economically active adults aged 18 and over are now qualified to at least level 2, which is a formidable record of which we can be very proud.
My hon. Friend Dr. Iddon made some important points about the marine and coastal access Bill. Perhaps more importantly, he brought to bear his considerable expertise in science and his history of teaching in a university under a Conservative Government. He mentioned the brain drain in the 1980s and 1990s, which has been stopped and reversed to the point at which senior international academics and students are now attracted to British universities. He mentioned funding for science and how important it was that it continued, which was echoed in the excellent contribution by Mr. Willis. Let me point out to the House the details of such funding over the past dozen years.
In 1997-98, the science budget was £2.4 billion; it is now £5.6 billion, and will be £5.9 billion in 2009-10. My hon. Friend the Member for Bolton, South-East and the hon. Member for Harrogate and Knaresborough mentioned the importance of the exploitation and commercialisation of research in higher education, on which they are absolutely right. They are obviously aware of the work of the higher education innovation fund in England, which helps knowledge transfer activities between universities and firms. As a result, university research income from contract research and consultancy has trebled since 2000 to more than £1 billion a year, and income from intellectual property licensing has also trebled. One of the areas in which I am interested is that of so-called green-collar—low-carbon—jobs, which can help to drive economic growth. It has been estimated that the overall added value in the low-carbon energy industry could be worth at least £3 trillion a year by 2050, and could employ more than 25 million people globally. Through the measures put in place by the Government, the UK is well placed to take advantage of opportunities for such technologies. The UK needs to build on that success by developing the appropriate skills, research and infrastructure base and making conditions conducive to innovation.
Sarah Teather described vividly and evocatively the pressures on both new supply of housing and the quality of existing housing stock. Her comments were echoed by Andrew Stunell. He was concerned that we will go for quantity rather than quality. That is absolutely not the case—we need to ensure that we build homes to last, not to be condemned in 10 or 20 years' time.
The hon. Member for Brent, East gave somewhat grudging support for the Government's package on repossessions. She will be aware of the Prime Minister's announcements on the day of the Queen's Speech with regard to the home owner mortgage support scheme. As part of a wider package of help for home owners, that will enable ordinary, hard-working households that experience a redundancy or significant loss of income to reduce their monthly payments to a more manageable level by deferring a proportion of the interest payments on their mortgage for up to two years. The country's eight largest lenders, who represent 70 per cent. of lending, have already agreed to support the new scheme and have pledged to work with the Government to implement it. That is on top of an earlier package to help to minimise repossessions, such as opening the mortgage rescue scheme to vulnerable households, fast-tracking the set-up of mortgage rescue schemes, and making the support for mortgage interest schemes more generous. We will not leave hard-working families who are frightened about losing their home high and dry, as happened in the 1990s. We will do whatever it takes to ensure that hard-working families can keep their homes, and to minimise repossessions.
In an excellent speech, Tony Baldry mentioned the growth in redundancies in his constituency, which he said had not been affected in such a way by previous downturns. His comments were echoed in the contribution of Mr. Timpson.
Let me put the position in context. This year, the number of people unemployed and claming benefits reached its lowest level for more than 30 years. The number of people in work increased by more than 3 million to about 29.5 million, the highest number ever. However, I do not want the hon. Member for Bromley and Chislehurst to think that I am complacent. I am aware of the pressures on employment caused by the economic downturn.
The Minister has referred to unemployment and given some apparently impressive figures. He will know that the number of NEETs—people not in education, employment or training—has increased dramatically. Does he expect it to continue to increase, or to fall?
It is good to see the hon. Gentleman back from the pantomime, but this is a serious point. As with repossessions, we are keen to minimise the number of people unemployed as much as possible. We do not want people to say "This is good for the economy: it is inevitable that we have some sort of recession and some sort of growth in unemployment", so we are investing an extra £1.3 billion in Jobcentre Plus and other services over the next two years to respond to rising unemployment. I believe that that will not only maintain but increase the support that we offer to people who unfortunately, as a result of the current global turbulence, may lose their jobs.
The hon. Member for Bromley and Chislehurst mentioned—again, in a thoughtful way—the frustration caused by the fact that some agencies, such as regional development agencies and local authorities, cannot gain access to funds in a coherent manner. The Government recognise that many businesses face real difficulties, and I think we have responded well by announcing a package of measures that will support small and medium-sized enterprises by addressing their top priorities: cash flow, access to finance, and training. Central Government are committed to paying businesses within 10 days, and RDAs are supporting that commitment. We are offering free health checks for businesses in England through the Business Link support services to help identify potential problems as early as possible, and we are providing financial information—produced by the Institute of Credit Management—to help United Kingdom businesses to maintain cash flow, which is essential at this time.
The hon. Gentleman mentioned eco-towns—after 19 minutes, which was probably a record for him. Mr. Garnier also mentioned eco-towns, along with the problems involved in a judicial review. A court hearing will be held on
My hon. Friend Mr. Anderson spoke with eloquence of his experience and analysed with great accuracy the industrial policy of previous Conservative Governments, which was also mentioned by David Simpson. I was greatly interested by his comments about the trade union movement and its links, on our patch, with Durham university. He will be aware of the great work of union learning representatives, which has done much to upskill the work force. As a fellow north-eastern Member, I am aware of the links between businesses and colleges and how strong they are on our patch, particularly—as my hon. Friend said in his excellent speech—the link between Nissan and Gateshead college. I also agree with him about the central importance of local authorities in trying to adapt to harsh economic realities
Mr. Ellwood was heavy on criticism but light on policy alternatives, which befits his position as a Front-Bench spokesman. I found the contribution of John Howell somewhat curious: he seemed to suggest that in attempting to attract overseas investment, the country should not publicise our strengths and competitive advantage. He too was heavy on criticism and light on alternatives, and I would imagine, with the greatest respect to him, that it will not be too long before he too is on his party's Front Bench.
Mr. Kennedy mentioned employment in his constituency, and his fear that we might return to the 1980s when adult male unemployment stood at 50 per cent. He mentioned the problems involving Tarmac, which I shall pass on to my right hon. Friend the Secretary of State for Scotland.
The challenges facing Government are clear. We need to help people through these tough times and respond effectively to economic downturn. We need to prepare for the upturn, and lay the foundations for long-term prosperity and sustainable growth.
The measures we announced in the Gracious Speech offer real, practical help for families, businesses and communities in these difficult times, but we are also planning for the future, taking the decisions now to help the country prosper and thrive over the longer term.
The debate stood adjourned. (Order, this day)
Ordered, That the debate be resumed tomorrow.