Clause 15

Child Poverty Bill – in a Public Bill Committee at 3:00 pm on 29th October 2009.

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Economic and fiscal circumstances

Photo of Graham Stuart Graham Stuart Conservative, Beverley and Holderness

I beg to move amendment 61, in clause 15, page 9, line 21, at end insert

‘including with regard to any statutory duty to reduce public borrowing’.

The Fiscal Responsibility Bill proposed in the Prime Minister’s Party Conference speech of 29 September 2009 will impose a legally binding obligation on the Government to reduce public borrowing. The amendment seeks clarification as to whether the Secretary of State, in preparing a UK strategy, and the Commission, in considering advice, will need to take into account this obligation.

As ever, it is a great pleasure to serve under your chairmanship, Mr. Key. The amendment follows on neatly from the points made rightly, albeit naively, by the hon. Member for Northavon; the credence that he gave to the Government’s promises was overly great. Before I deal with the specifics of my amendment, I want to focus more on statutory targets. What do statutory targets mean? I asked the Library to investigate the history of statutory targets, and it duly produced a note on the subject. I wanted to find out whether they had a history, because it has always seemed manifestly absurd to put targets in statute, whether in this Bill or in the Climate Change Act 2008.

Time and again in debate on the Climate Change Bill, Ministers boasted of a legal duty on Government to deliver. When I looked into the history of statutory targets, I found that no Government prior to this one had ever put targets into statue, at least according to the House of Commons Library. Many Back Benchers had come forward with private Members’ Bills that suggested doing exactly that, but they always had to change the wording to refer to a provision for setting targets, so as to give the Government of the day the flexibility to respond in the right way. The Library came through with a list of the provisions that have been made. The Water Act 2003 has concentration of fluoride targets, the Housing Act 2004 has energy efficiency of residential accommodation targets, and there are other targets that have been put together by the Government. It is a relatively novel thing to do.

If one looks for legal advice on such matters, one finds the article by Harriet Townsend on the Climate Change Act 2008. That goes to the point of what the hon. Member for Northavon said: what enforceability is there? As he said, why bring genuine child poverty charities and campaigners to Parliament and make them believe that if the agenda, which they rightly say should be more central to Government policy making, is put in statute, the justice that they have long sought for children in poverty can be had? What is the point if it turns out that we are talking about sleight of hand, or Government posturing, with no enforceability mechanisms whatever for those who feel that they had been made a binding promise, and who believed that it was binding by dint of being in statute?

Harriet Townsend’s paper on the Climate Change Act 2008, which is well worth reading because of its relevance to the matter at hand, effectively says that she cannot see that any duty set in statute can be enforceable. So far, the only cases that have come before a court, which I will come to in a moment, have resulted in a  declaration only. I feel that a fraud is being perpetuated at the heart of the Bill. It is a fraud on all those who campaign for and care most about child poverty, because the statutory targets set in the Bill are not, in fact, enforceable.

Photo of Jamie Reed Jamie Reed Labour, Copeland

Will the hon. Gentleman give way?

Photo of Graham Stuart Graham Stuart Conservative, Beverley and Holderness

I would be delighted to hear from the hon. Gentleman, who I know is a decent and passionate member of this House. He will be able to tell us how we can, or whether we should, change the situation.

Photo of Jamie Reed Jamie Reed Labour, Copeland

The feeling is mutual, I assure the hon. Gentleman. I seek clarity, but not for purposes of mischief. Does he believe that the eradication of child poverty should be a statutory obligation?

Photo of Graham Stuart Graham Stuart Conservative, Beverley and Holderness

That is a very good question. No Government prior to this have specialised in setting targets and failing to meet them, and in painting a picture of a society joined together in social justice, harmony, happiness and enterprise. Enterprise used to be allowed, in the early days at least. No Government have ever painted a picture so compelling, and yet so signally failed to deliver, despite the vast spending of resources in pursuit of that nirvana. Sadly, it looks increasingly as though that was money that the country could not afford.

Photo of Jamie Reed Jamie Reed Labour, Copeland

I am afraid that I missed the answer; is that a yes or a no?

Photo of Graham Stuart Graham Stuart Conservative, Beverley and Holderness

No, for the reason that no previous Government have set targets in statute. I do not believe that it is right to do so. There are a number of reasons why, but I shall give him one, because I think that that will suffice: it had been a fundamental constitutional principle that one Parliament could not bind another. After a general election, when a democratically elected Government comes in, they will doubtless have to take some very tough decisions indeed, following the wreckage of the UK economy by the Financial Secretary and his friends; we can all imagine that.

It is impossible to imagine that a court of law would intervene and say, “This statute was passed by a previous Government when they were still spending money like it was going out of fashion, before we had our credit withdrawn by the international bond markets. So I’m afraid your ability to maintain basic public services and the armed forces, and all other duties, have to be set aside, because there happens to be a statute in place specifically for this one area of social policy.” Do pensioners’ problems have to go to the wall while we ensure that the issue of relative poverty is dealt with, because that one issue was plucked out by a Government desperately flailing around in their final months, trying to find a dividing line between them and the Opposition? Is that to be the case? I suggest to the hon. Gentleman that it is not.

Moving on to my amendment, my timing is probably fortuitous. A fiscal responsibility Bill proposed in the Prime Minister’s party conference speech on 29 September will

“impose a legally binding obligation on the Government to reduce public borrowing.”

Notwithstanding the fact that the Government have introduced the Climate Change Act 2008 and want to introduce this Bill, they are introducing another legally binding measure, which apparently means that public borrowing has to be reduced. My amendment seeks clarification as to whether the Secretary of State, in preparing a UK strategy, and the commission, in considering advice, will need to take into account that obligation, as it would be rather peculiar if they did not.

In addition to the proposed fiscal responsibility obligations, the Government are bound by law to meet several other statutory targets. I will quickly go through some examples. There is a legally binding target to ensure that the net UK carbon account for 2050 is at least 80 per cent. lower than the 1990 baseline, and a duty to eradicate fuel poverty in all households by 2015. The Government also propose legislating for a legal obligation to ensure that the target for expenditure on official UK development assistance amounts to 0.7 per cent. of gross national income. This Government love to take things that we all devoutly wish to see and turn them into law, and they then expect that that will make those things happen. All those targets will involve additional public spending, at a time when the Government will be compelled, either by law or by bond markets, to drastically—I should say, “drastically to”; I hate split infinitives—reduce public borrowing. The Institute for Fiscal Studies said in 2006—this has been frequently quoted in our proceedings—that an additional £4.3 billion will have to be spent on tax credits and benefits if we are to meet the 2010 target.

We need clarity on the priority of targets if the Bill is to have any credibility, notwithstanding the fact that I do not think that it has any. That need was highlighted by the judicial review brought by Friends of the Earth and Help the Aged against the Government for failing to keep their legal duty, as the hon. Member for Copeland will be aware, to eradicate fuel poverty under the Warm Homes and Energy Conservation Act 2000. “It is an open-and-shut case”, the hon. Member for Copeland, or even the hon. Member for Northavon, may think. The Government’s defence was that it was not

“reasonably practicable to take all of the measures that would be required to eradicate fuel poverty, as...the resources are not available to pay for them all at the present time given the money available.”

I say to any child poverty group outside the House that they should bear that in mind before they accept any promises from this failing Government.

The court agreed with the Government, and dismissed the claim that they had breached their duty under the 2000 Act on the grounds that they had taken budgetary considerations into account. The judgment continued, and said that the Government

“did not assume a statutory duty to achieve the desired results, whatever the cost...It is open to Government to have regard to its overall budget and the other calls upon its resources in deciding what steps to take in implementation of the strategy, including its requirement that efforts should be made to achieve the 2010 and 2016 targets as far as reasonably practicable.”

The purpose of my amendment is to tease out the issue and ask about the series of competing legal duties, all of which have been enacted by this Government with scant regard for legal enforceability and the need for the  Government to be honest about what they can and cannot deliver, particularly for the most vulnerable in our society.

Photo of Steve Webb Steve Webb Shadow Secretary of State for Work and Pensions 3:15 pm, 29th October 2009

On a point of order, Mr. Key. Are you minded to have a separate clause stand part debate? It would be possible to make the stand part points on the amendment, but if not I will shut up now and wait for the stand part debate.

Photo of Robert Key Robert Key Conservative, Salisbury

Yes, it might well be possible to do that.

Photo of David Gauke David Gauke Shadow Minister (Treasury)

Thank you, Mr. Key. I also thank the hon. Member for Northavon for a helpful clarification there. One or two points arise from the comments of my hon. Friend the Member for Beverley and Holderness, which I will address in the context of the stand part debate, but I turn more specifically to amendment 61 and the background to it. I thank my hon. Friend for tabling the amendment as it enables us to probe a little deeper the Government’s thinking in this area.

Until relatively recently we have had 10 years of benign global economic conditions. The Government were running a deficit through many of those years, but until a couple of years ago we were travelling through relatively good economic weather. But we are not going to meet our 2010 targets. The explanation Ministers have given us has been that we are constrained by the financial situation. The Financial Secretary told us during the evidence session:

“in the current environment, Government spending is very tightly constrained. That, in particular, is what has limited what has been possible over the last couple of years.”——[Official Report, Child Poverty Public Bill Committee, 20 October 2009; c. 9, Q21.]

This is a time when the Government consider that large deficits are part of their economic strategy in an attempt to revise Keynesian economics and to spend our way out of a recession. We have seen deficits reaching record peacetime levels as a percentage of GDP. We suspect it will reach 14 per cent., which is twice the figure it was when Denis Healey had to go to the IMF in 1976. This has not been a time when the Government have been noticeably diligent in keeping deficits down at a low level, yet that has still been a constraint on Government policy and the ability to meet the 2010 target.

If this has been a period of highly restrained public spending, I should like to know what would constitute an unrestrained period of spending. We are about to enter into a period of severe financial constraint, despite the rhetoric that we occasionally hear now and heard more earlier in the year about the difference between Labour investment and Tory cuts.

Photo of Graham Stuart Graham Stuart Conservative, Beverley and Holderness

We do not hear quite so much of it now.

Photo of David Gauke David Gauke Shadow Minister (Treasury)

No, we do not, although we heard a little bit of it from the hon. Member for Amber Valley earlier today. We know that the Government intend to reduce public spending significantly in the period from 2011. We have now seen Treasury documents showing reductions in departmental spending over a period of three or four years of over 9 per cent. Of course, we heard the Prime Minister’s party conference speech on 29 September, to  which my hon. Friend referred. It consisted largely of unfunded spending commitments, but it also mentioned a fiscal responsibility Act that would make it legally binding to reduce the deficit. Presumably, legally binding means legally enforceable. Somebody would be able to take the Government to court in an attempt to reduce the deficits, in much the same way as somebody will be able to bring the Government to court for failing to deliver on their child poverty strategies.

It is clear that the Child Poverty Bill may result in higher public spending as a consequence of action taken pursuant to it. The Financial Secretary was clear about that when in his evidence to the Committee on 20 October he said:

“There certainly could be a judicial review that in effect required the Government to spend more on tax credits or some other element of the benefit or tax credit system.”

He also said:

“Under the Bill, a court could, in response to a judicial review, require the Government to make substantial spending commitments in order for the targets to be met.”——[Official Report, Child Poverty Public Bill Committee, 20 October 2009; c. 11, Q26-28.]

That quotation is interesting, and I hope that some of us will get the opportunity to debate the fiscal responsibility Bill. One could easily reword the Minister’s statement. Indeed, I might have the opportunity to ask the Financial Secretary whether it would be possible for the Government to be subject to judicial review to meet the deficit requirements. He might respond, “Under the Bill, a court could, in response to a judicial review, require the Government to make substantial spending cuts in order for the targets to be met.” We could face two actions simultaneously; one requiring the Government to spend more money, and the other requiring them to spend less. That is something of a mess.

Photo of Steve Webb Steve Webb Shadow Secretary of State for Work and Pensions

The hon. Gentleman is astute and he will appreciate that the money required to tackle child poverty is but a relatively small subset of total public spending. He will therefore fully appreciate that it is not inconsistent to do more on child poverty while simultaneously reducing overall spending or the deficit. I think that he is saying that, if he is a member of a future Conservative Government, he would not like to be bound by the child poverty obligation. He would like to be able to say at that point, “Money’s tough; we’ll put it on hold.” That is what I think he is really saying.

Photo of David Gauke David Gauke Shadow Minister (Treasury)

I am trying to get some clarity from the Government. The Government have a tendency, for the reasons outlined by my hon. Friend the Member for Beverley and Holderness, to pass legislation that is essentially declaratory in nature. Why not extend the principle to a statement about spending on the NHS, the armed forces or a whole range of other areas? I do not want to stray into a wider critique of legislation by declaration, because I want to say something about that in the stand part debate. However, who determines the balance of priorities? Should it be a matter for politicians and for Ministers accountable to Parliament? I accept the point made by the hon. Member for Northavon, but we could find ourselves in a crisis or in a situation similar to the one we are in at the moment. The Government are saying, “We are not going to meet our child poverty targets or do more to meet them, because we have run out of money.” If we are in such a situation in 10 years, what will happen when two pieces of legislation are going in diametrically opposite directions?

Photo of Steve Webb Steve Webb Shadow Secretary of State for Work and Pensions

This goes to the nub of the Bill. Presumably, the point is, as the hon. Gentleman said, that any future Government can repeal the Act or amend it. However, what we are doing today is increasing the political price of doing so. Given that we all care about the abolition of child poverty, is that not a worthwhile thing to do?

Photo of David Gauke David Gauke Shadow Minister (Treasury)

Again, the hon. Gentleman prompts me to say something that I was going to say a little later. The Bill has two provisions that put political pressure on Ministers. The first is the report, the publication of the strategy, and the fact that Parliament has an opportunity to review and scrutinise. Everything is in the public domain. It is clear what the targets are and the Government must be clear about what they are doing and how successful their strategies are. It would be fair to say that Kate Green’s remarks during the evidence sessions were principally about political pressure. I think that evidence reflects generally what is being said by the outside bodies.

There is also the judicial review point, which I feel a degree of uneasiness about, because it puts essentially political questions to the judiciary. There is a danger in that. My hon. Friend the Member for Beverley and Holderness alighted upon the point that when there are two particular measures—the targets that the Government seek to legislate for—they could well move in opposite directions. As we speak, they are dragging the Government in different directions. I think it is right to highlight that.

Photo of Jamie Reed Jamie Reed Labour, Copeland

Does the hon. Gentleman believe that it is a binary equation that to reduce child poverty we must increase public spending?

Photo of David Gauke David Gauke Shadow Minister (Treasury)

The hon. Gentleman makes a helpful point. Our argument on tackling child poverty—it is a point that the Government have made as well; they set it out very clearly in the explanatory notes—is that it is not simply a matter of spending more money in income transfers. That is not a sustainable way of addressing child poverty. We fully endorse that and have been arguing that point for some time. I am delighted that the hon. Gentleman agrees. Nonetheless, if we want at all costs to meet the target and we have a binding obligation that we have to meet, and if, particularly towards the end of the strategy period, we want a quick fix, we can do that quickly by raising benefits and tax credits. The evidence of the IFS, for example, is that if the Government in the pre-Budget report, which is due in a few weeks’ time, decide to go down that route, they could still meet their 2010 target. We do not expect them to do that. We do not think that it is sustainable, and the public finances cannot support that. I am not criticising the decision that will be made in the PBR, but we must bear it in mind that the Bill could be used as a way of saying, “You must spend more on benefits and tax credits,” which the Minister, to be fair, acknowledged during the evidence session.

Photo of Jamie Reed Jamie Reed Labour, Copeland

I agree with the hon. Gentleman that it is not a binary equation. Given that we all accept that it is not a binary equation, that we all recognised on Second Reading that it is about priorities and that there is flexibility within any democratically elected Government’s portfolio for choosing priorities, surely there can be no grounds for objecting to this being a statutory obligation?

Photo of David Gauke David Gauke Shadow Minister (Treasury)

In a way, the hon. Gentleman is perhaps arguing for some clarification, which is what the amendment seeks to provide. If I understand it correctly, it seeks to make it clear that meeting the targets is subject to the fiscal responsibility Bill—assuming it comes into force. What the hon. Gentleman argues for is fine—we can meet the terms of the fiscal responsibility Bill, because it is not just about money, and I do not disagree with his essential analysis. The amendment is trying to explore what would happen if we were in a similar position to our current one in 10 years’ time. When faced with an obligation, would the Government be able to say, “Hold on, getting our deficit down is very important.”? I think the amendment makes it clear which one would prevail.

If we have two separate obligations going in different directions, I am not entirely sure what the judges are supposed to do. Do they just pick the one that they like most? Do they pick the most recent one? As I understand it, subsequent legislation is seen to be superior to—overrides—previous legislation, but it does not always work like that. For example, going back a long time to when I was an undergraduate, if I remember correctly the European Communities Act 1972 is an implied term in every piece of legislation passed since the Act, so unless the legislation expressly overrides that Act, it is subject to it—that is what the Factortame line of cases established. I do not think that that applies here, but there is potential uncertainty.

I wonder whether this is an opportunity for the Minister to save some legal fees for the likes of the Child Poverty Action Group, or whoever might subject the Government to judicial review, and provide some clarity as to how the two pieces of legislation—one before us and one promised—will hang together. That clarity would be useful in understanding exactly how the Bill works.

Photo of Stephen Timms Stephen Timms Parliamentary Under-Secretary (Department for Business, Innovation and Skills) (Digital Britain) (also HM Treasury), Financial Secretary (HM Treasury) (also in the Department for Business, Innovation and Skills) 3:30 pm, 29th October 2009

I could not help but notice as the hon. Member for Beverley and Holderness opened the debate that the new era he announced to us this morning—the one in which he will not be overstating his case—has not started yet, although I look forward to it. I found myself firmly in agreement with one point that he made—his antipathy to the use of split infinitives. I share that with him, but I am afraid not a great deal else.

The essential point is that the goals of fiscal responsibility and eradicating child poverty are not incompatible—we have to achieve both. The targets will certainly have to be achieved in a fiscally responsible way. If that was not possible, the long-term sustainability of our child poverty commitment would not be delivered. The strategy—when it is published within 12 months of Royal Assent—will need to set out how that will be achieved, and how the targets will be delivered in a fiscally responsible way. Those goals are consistent with clause 15, which requires the Secretary of State to take into account fiscal and economic circumstances. I shall argue, when we come to the stand part debate, that that obligation is a strength of the Bill because, in fulfilling it, the Secretary of State will need to take the likely impact on public borrowing into account when preparing a strategy to meet those targets. The clause requires the Secretary of State to  have regard to those responsibilities when setting out his proposed action for meeting the targets.

The fiscal responsibility Bill will require the Government to reduce the budget deficit year on year to ensure that national debt remains sustainable in the medium term. That is, and must be consistent with, the Secretary of State’s obligation to take into account the impact of child poverty measures on public borrowing. The publication of annual reports will provide a transparent accountability framework to enable regular monitoring and scrutiny of progress. Those accountability arrangements will ensure that we continue to make progress in a sustainable way. That was always going to need to be an obligation and a characteristic of the strategy when it was produced. The hon. Gentleman made a perfectly fair point. The requirement is highlighted by the announcement of the fiscal responsibility Bill, but that would always have to have been a part of the strategy.

This Bill allows us to plan to meet both those obligations, so I hope the hon. Gentleman will accept my reassurances on that point and feel able to withdraw his amendment.

Photo of Graham Stuart Graham Stuart Conservative, Beverley and Holderness

What can the Minister tell us about enforceability? I spoke a lot about it—he is humorous about the new era of me understating my case, which he and I devoutly wish to see begin, but perhaps not today. The point about the unenforceability of this and other statutory targets is not just mine—it may be a minority point of view in Parliament, but not in the legal community. The Minister needs to take the issue seriously.

I go back to Harriet Townsend, the barrister who said, in the context of the Climate Change Bill:

“Notwithstanding the potential for judicial review, both the” duties

“to ensure compliance with the five yearly budgets would, in my opinion, be ultimately unenforceable in the courts.”

That was the legal view. I know there was a lot of to-ing and fro-ing on the topic during the Climate Change Bill, but could the Minister bring us up to date with the Government’s legal position? Have the Government taken counsel’s advice on legal enforceability? That goes to the heart of my amendment.

There are two questions: mine, about enforceability; and secondly, about how that enforceability works when we have, potentially, legislation pointing in different directions, one direction requiring a reduction in government expenditure and another an increase. Although the Minister has a capability—nay, a facility—to sound reasonable while saying things that are indefensible to my mind, while I have exactly the opposite ability at many times, I would be interested to hear from him on both those points.

Photo of Stephen Timms Stephen Timms Parliamentary Under-Secretary (Department for Business, Innovation and Skills) (Digital Britain) (also HM Treasury), Financial Secretary (HM Treasury) (also in the Department for Business, Innovation and Skills)

Let me attempt to tackle that point. The courts can respond in a variety of ways in relation to judicial review. The hon. Gentleman mentioned a declaration, which a court can make; a court could quash an order, require a Government to set aside a particular policy decision, issue a prohibiting order forbidding an action, or issue a mandatory order requiring a particular course of action. The courts have many measures at their disposal if they seek to determine a judicial review against the Government on either of the Bills under discussion.

Photo of Graham Stuart Graham Stuart Conservative, Beverley and Holderness

I take it from the Minister’s answer that he is seriously suggesting that a court would use any such powers. The main focus of the Bill is incomes. I think that Ministers have accepted and agreed that when we get towards the end of the period, the long-term issues around improving children’s centres, early intervention, lack of attainment in families at an early age and so on go out of the window, at least in terms of meeting a target that is fixed in time. Does the Minister believe that the courts—or anyone—could enforce action against Government on the child poverty target in the early years? That is my first question.

Secondly, the only time that I could conceive of a court starting to use any of the fairly strong measures that the Minister talked about—barring or insisting on certain activity by the Government—would be right at the end. My hon. Friend the Member for South-West Hertfordshire has tried putting counterfactuals to the Minister before, with limited success in gleaning a full answer, but if the legal duty existed now, would the Minister expect a court to insist that the £4.3 billion or whatever is spent by Government in order to meet the 2010 target? Does the Minister seriously expect that sort of thing to happen in future? If he does not, that would suggest what Jeff Rooker said during consideration of the Climate Change Bill:

“It is not just about the punishment in the event of failure; it is about trying to change institutional behaviour through a change in the law.”—[Official Report, House of Lords, 27 November 2007; Vol. 696, c. 1209.]

That is a rather vague concept, but I have always found Jeff Rooker an honest and straightforward Minister and I think that he was effectively saying, as best he could, that the target was not enforceable. He hoped that, by putting it in statute, it might be taken a bit more seriously by the civil servants and others than it would otherwise, but it is not a legally enforceable target.

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Amendment made: 46, in clause 15, page 9, line 24, leave out ‘them’ and insert

‘the Scottish Ministers or, as the case may be, to the Northern Ireland departments’. —(Helen Goodman.)

The effect of this amendment is that, in relation to Northern Ireland, clause 15(3)(a) refers to the Northern Ireland departments in general, rather than to the Office of the First Minister and Deputy First Minister. See Member’s explanatory statement for amendment 34.

Question proposed, That the clause, as amended, stand part of the Bill.

Photo of David Gauke David Gauke Shadow Minister (Treasury)

I shall be brief because the points I wanted to make in the clause stand part debate I made with regard to amendment 61. There are two key elements to the pressure placed on Ministers by the Bill. The expression, “Holding the Minister’s feet to the fire”, has been used on more than one occasion. Kate Green of the Child Poverty Action Group, for example, said in evidence to us:

“Of more importance to us is that the Bill gives public profile and a political push to the issue and ensures that there is constant progress and momentum.”——[Official Report, Child Poverty Public Bill Committee, 20 October 2009; c. 34, Q80.]

Her focus was on that, although, of course, she acknowledged the possibility of judicial review. I am nervous that Ministers, in seeking to achieve a range of  objectives, are held accountable to Parliament, but decisions may be made ultimately by the judiciary. There is a difficult tension between keeping deficits down and wanting to raise benefits to meet child poverty targets. The Government, including the Financial Secretary, are wrestling with that dilemma on a daily basis, in preparation for the pre-Budget report.

There are other areas of tension. Returning to evidence provided by Kate Green, she raised concerns about a tension between welfare reform and meeting the targets. That is difficult, as there is cross-party consensus on the need for welfare reform to do more to end a culture of dependency. That involves sticks and carrots—the exact composition of the sticks and carrots is a finely balanced judgment. It is possible to imagine circumstances in which Ministers take one view of the right course of action and the judiciary another. I worry about too many powers being passed on to the judiciary rather than democratically elected politicians. It is a concern.

Perhaps most significant is the issue that we return to with clause 15: the economic and fiscal circumstances. It is reasonable for the Government to include the clause. I know it has received some criticism. In all honesty, a Government must always act in accordance with economic and fiscal circumstances. My general criticism of the Government is that they have not done enough of that over recent years with regard to the public finances.

The Minister almost implied that the constraint on the targets—if there is, in reality, much of a constraint—would always be there. Governments always have to act responsibly or should do so, and, ultimately, we do not object to the clause.

Photo of Steve Webb Steve Webb Shadow Secretary of State for Work and Pensions 3:45 pm, 29th October 2009

Whereas we do.

A clause stand part debate allows us to question what might happen if the clause was not part of the Bill. Presumably, clause 15(1)(a) means that the Secretary of State might be reckless. The probable Chancellor might decide to have no regard for economic or fiscal circumstances, taxation, public spending or public borrowing. The idea that, when forming policy, a future Chancellor might have no regard for public spending, taxation or public borrowing is a tad unlikely.

Photo of Steve Webb Steve Webb Shadow Secretary of State for Work and Pensions

All right. Let me put it another way: the proposition that clause 15 would make a blind bit of difference to whether a future Chancellor had regard for public borrowing or public spending is unlikely. Assuming that the Financial Secretary anticipates his colleagues and successors in that role, I am sure that he would not suggest that they would behave in such a manner. I am not clear about the restraining impact of subsection (1)(a). In a sense, such a measure is unnecessary under that subsection and it is inappropriate under subsection (1)(b), which deals with the child poverty commission.

We might say that we are talking only about a bunch of academics, but even they will presumably have regard for such matters when making a recommendation about tackling child poverty. We must assume that we have followed the personal specification under schedule 1  and that they are a body of fine people with knowledge of the formulation, implementation and evaluation of poverty, and experience of research into child poverty and work with children. The idea that they just head off to another planet without regard for the environment in which they work seems implausible, but we do not want them to self-censor. We want the child poverty commission to say something a bit uncomfortable occasionally—something that might require serious public spending or taxation—and it will then be for Ministers to decide.

We do not want the child poverty commission internalising such matters or pre-empting the political judgment of priorities—that is not its job. Its job is not to weigh up the relative merits of spending money on nuclear weapons or child poverty, but to advise on cost-effective ways of tackling child poverty. The Government can then judge between alternative strategies for that or other issues on which they want to spend money. I cannot see how clause 15 would ever be used. Will someone take the Secretary of State to court for not being fiscally responsible in his approach to child poverty? That is pretty implausible. We have already heard how difficult it is to enforce the entire Bill, let alone the clause. Will we take action in law against the child poverty commission for being a bit irresponsible? What is the clause doing? Why is it in the Bill?

In what circumstances could the clause be used? In evidence to this Committee and, indeed, to the Work and Pensions Committee, the Minister said that he would go away and think about the matter. I should be interested to know how that lunch time went. My underlying worry is that we have a binding target. The right hon. Gentleman assured us that it is not undermined by clause 15. Perhaps we ought to have a metaphorical clause 15 in all Bills requiring such things of everyone and all people. Why do we have the clause in this Bill, when such a measure could fit into any Bill? That is odd. What is it about the Bill that makes the Government want to add such a provision to it? Unless we are given a convincing reason for its inclusion, we cannot agree with it.

Photo of Stephen Timms Stephen Timms Parliamentary Under-Secretary (Department for Business, Innovation and Skills) (Digital Britain) (also HM Treasury), Financial Secretary (HM Treasury) (also in the Department for Business, Innovation and Skills)

Let me start by confirming that clause 15 does not have an impact on the binding character of the target, which is a point that the hon. Member for Northavon rightly said that I had made before. In my view, clause 15 strengthens the Bill. The truth is that we shall achieve the targets only if we can establish an economically sustainable way to do so. The hon. Gentleman focused on subsection (1)(b) and, if we were to remove the clause, it is true that we would then liberate the commission to produce advice unrestrained by economic realities—sometimes that can be advised by his party. But what use would that be? I do not agree with him about this. I think that we want the commission to be constrained by realities. The hard bit of the job is determining how we are going to achieve these targets in a way that is consistent with the realities of what will happen over the next 10 years, and that is precisely what we want the commission to help us with. I do not think that anyone is interested in well meaning flights of fancy. What we want from the strategy and from the commission’s advice is hard-headed measures consistent with economic reality because those are what can be implemented to eradicate child poverty.

Photo of Steve Webb Steve Webb Shadow Secretary of State for Work and Pensions

Will the Minister remind us who appoints these people? Do not he or his colleagues appoint them,  and does he really think he will appoint people given to flights of fancy? Surely these are expert people who live in the real world. Why do they need a legal duty to do something that they will do anyway?

Photo of Stephen Timms Stephen Timms Parliamentary Under-Secretary (Department for Business, Innovation and Skills) (Digital Britain) (also HM Treasury), Financial Secretary (HM Treasury) (also in the Department for Business, Innovation and Skills)

I think it will be very helpful for the commission to have this clear remit that it is to formulate advice that is consistent with the financial circumstances over the next 10 years. I can think of many experts who have given advice on a variety of topics that does not comply with the clause as it is set out in the Bill. We want this particular group of experts to give us advice that does comply. It is a strength of the Bill that that is made explicit so that everybody is clear what is required.

Photo of Andrew Selous Andrew Selous Shadow Minister (Work and Pensions)

The Minister has said something significant and I want to make sure that I understood it correctly. He rightly said that we need to find a sustainable solution to eradicating child poverty—we are all with him on that. By that I took him to mean one that was financially sustainable and did not break the bank. Is he implying that if we are not quite there in 2018 and 2019 but a significant increase in tax credits would take us there, yet that would not be sustainable for the UK economy, it would not be the right thing to do?

Photo of Stephen Timms Stephen Timms Parliamentary Under-Secretary (Department for Business, Innovation and Skills) (Digital Britain) (also HM Treasury), Financial Secretary (HM Treasury) (also in the Department for Business, Innovation and Skills)

The hon. Gentleman puts a hypothetical situation to me. There will be a series of three-year strategies over the next decade and annual reports against each of them. The hon. Member for South-West Hertfordshire quoted what I said on this: I do not think that when we get to the latter point of the decade what has happened will take us by surprise. As for whether clause 15 should be in the Bill, it is undoubtedly a strength of the Bill that it is here. It gives a clarity of purpose to everybody involved.

Question put and agreed to.

Clause 15, as amended, accordingly ordered to stand part of the Bill.

Clause 16 ordered to stand part of the Bill.