Commons Sitting of 25 November 1996

Preamble
The House met at half-past Two o'clock
PRAYERS
[MADAM SPEAKER in the Chair]
Oral Answers to Questions
  TRANSPORT

    Road Freight
    Mr. Spring: To ask the Secretary of State for Transport what measures he is taking to encourage alternatives to road freight. [4002]
    The Secretary of State for Transport (Sir George Young): Privatisation is helping rail to win new freight traffic, and we have created the economic conditions in which the shipping and ports industries can grasp business opportunities. We continue to make available grants to encourage the shift of freight from road to rail and water.
    Mr. Spring: Given the congestion on the roads, may I warmly welcome my right hon. Friend's initiatives to move freight off the roads and on to rail, especially his initiative in establishing the freight facilities grant to give further incentive to that desirable trend?
    Sir George Young: I entirely agree with what my hon. Friend says about the importance of freight grants. He will be pleased to learn that grant expenditure has increased every year since 1991–92 and that my Department's
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    spending in the current financial year is likely to be the highest for 10 years, even before the recent award to Freightliner, which is worth up to £75 million over five years.
    Mr. Chidgey: Does the Secretary of State agree that the tripling by Railtrack of the costs for enlarging the loading gauge on the west coast main line, which is essential to the success of the piggyback freight consortium, is a positive discouragement to alternatives to road freight? What action will he take to make Railtrack accountable and ensure that it provides more freight on the rails rather than merely maximising profits?
    Sir George Young: The hon. Gentleman slightly jumped the gun in his initial conclusion. Railtrack has been examining the cost of upgrading the west coast main line to take piggyback freight, and consultants appointed by my Department have kept abreast of the work to ensure that any grant application can be dealt with expeditiously. We must wait for Railtrack to finish its analysis before arriving at any firm conclusions. I confirm that it is indeed Government policy to secure any useful transfer that we can of freight from road to rail.
    Mr. Gale: I applaud my right hon. Friend's endeavours to move freight from road to rail, but he will recognise that, for the moment at least, much freight travels by road and by sea. Those of us who represent channel ports are extremely concerned about the damaging effects of the illegal strikes and blockades in France on the employment of our constituents. The European Commissioner who is responsible for such matters, Mr. Kinnock, is uncharacteristically silent on the subject. What endeavours are the Government making to have the blockades lifted and the illegal strike ended?
    Sir George Young: I am grateful to my hon. Friend for raising this most important subject. Before the weekend, I made strong representations to the French Transport Minister about the plight of British lorries and the innocent drivers who have been detained. I received a

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    response this morning regretting what has happened, confirming that some British lorries were released over the weekend and enabled to proceed and giving details about claims for compensation. However, if the matter is not resolved soon, I may need to write again.
    Mr. Andrew Smith: With 1,000 British lorry drivers stranded in France, at considerable inconvenience, cost and risk to their personal safety, does the Secretary of State agree that the House will expect the French authorities to afford every protection to British lorry drivers?
    On compensation, does the Secretary of State agree that the confusion about documentation and what is necessary to register a valid claim must be sorted out without further delay? The matter should be taken up with the French authorities by the Prime Minister, to ensure that our lorry drivers get a fair deal.
    Sir George Young: On compensation, which is important, the letter from the French Transport Minister has some useful information. The hon. Gentleman's concern about industrial disputes in France would have more credibility if occasionally he condemned those in this country.
    Mr. David Shaw: Is my right hon. Friend aware that ferries from Dover are having great difficulty in taking any lorries at all, because of the blockade of Calais? Is not it unreasonable that Dover ferry companies and haulage companies should lose vast amounts of money in the current circumstances? Many of my constituents are stranded in France with lorries and are unable to come back home to their families. French police are forcing British lorry drivers to join blockades to help the French lorry drivers' strike.
    Can my right hon. Friend confirm the serious allegations, which may turn out to be true, that the channel tunnel was sabotaged by a striking French lorry driver? Is this not an appalling state of affairs? What will happen about compensation, because, the last time the French promised it, they never paid up?
    Sir George Young: I know that the French inquiry, headed by an investigating magistrate, is under way. That inquiry will want to consider the cause of the fire, and will certainly want to investigate the allegations that my hon. Friend mentioned.
    I take the issue of compensation extremely seriously. Many owner lorry drivers' futures are threatened by the dispute and many of the smaller haulage companies also face an extremely difficult financial future. We propose to take further action to ensure that the compensation claims are promptly processed by the French authorities.

    National Bus Network
    Mr. MacShane: To ask the Secretary of State for Transport what steps he is taking to ensure that major urban centres form part of the national bus service network. [4003]
    The Minister for Railways and Roads (Mr. John Watts): The Government are keen to encourage bus use, and are working actively with operators and local
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    authorities on measures to this end, notably through the bus working group and through support for local transport schemes designed to promote bus travel. There is already an extensive network of bus and coach services serving major urban centres. Specific additions to the network are primarily for the commercial judgment of operators.
    Mr. MacShane: I thank the Minister for his reply. He will be aware that a spanking new bus interchange, one of the finest in Europe, has recently opened in Rotherham, but it is not connected to any of the national bus networks. The answer is always that it is a matter for commercial judgment or local subsidies. I understand that; but is the Minister aware that, if many towns the size of Rotherham are isolated from the national bus network, that drives more and more people into their cars? Is he aware that, as a result, the traffic jams into London sometimes start at junction 31 in South Yorkshire because people are obliged to use their private cars, as, under deregulation, buses do not operate within a national network to serve leading metropolitan borough centres such as Rotherham?
    Mr. Watts: If the hon. Gentleman cares to consult the Great Britain bus timetable, he will find that 16 different bus services link Rotherham with other towns in the region and that there is a daily coach service between London and Rotherham. There are yet more frequent services between London and Sheffield, which is a half-hour bus ride from Rotherham.
    Dr. Spink: How many new buses and coaches is Stagecoach ordering now?
    Mr. Watts: I cannot remember the precise figure off hand, but my hon. Friend is quite right to draw attention to the substantial orders recently placed by Stagecoach and other private sector companies.

    Traffic Reduction
    3. Mr. Rendel: To ask the Secretary of State for Transport what plans he has to introduce new measures to reduce road traffic. [4004]
    Mr. Watts: Our Green Paper sets out a range of measures, including new powers for local authorities to manage traffic demand in their areas, privatisation of rail passenger and freight services, support for bus priority measures and encouragement for green commuting and transport plans.
    Mr. Rendel: Does the Minister agree that it would be a good policy to try to introduce some targets for road traffic reduction? Given that 200 Members from all parties have already signed an early-day motion in support of the Road Traffic (Reduction) Bill, which my hon. Friend the Member for Bath (Mr. Foster) is to introduce, will the Government guarantee it a fair wind and do everything they can to make sure that it is passed?
    Mr. Watts: I am very much in favour of the inclusion of targets in local transport plans and I encourage local authorities that seek to include targets in their package bids in order to show what they expect to deliver. I have agreed to meet the hon. Member for Bath to discuss the terms of his Bill.
    Sir Peter Fry: Will my hon. Friend not be seduced too much by Opposition arguments? I agree that it is right to

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    reduce traffic where possible, but I am sure that he accepts that the Government do not want to appear to be anti-motorist. Most of my constituents, and most of his, own a motor car and expect to be able to use it in reasonable circumstances. I hope that that will be the policy of the Government.
    Mr. Watts: My hon. Friend is entirely right: it would be folly for any Government to be anti-car and anti-motorist. We must seek to provide car users with attractive, convenient and acceptable public transport alternatives, so that they can choose whether to go by car or by public transport, which is what our policies are designed to do.
    Mr. Grocott: Does the Minister agree that one way of encouraging more traffic to travel by rail would be to encourage the franchising director to require potential franchisees to improve on current levels of service? Will the Minister write to the director and suggest that he reinstate the through service from Telford to London, which was lost some years ago and which was always assumed to be part of the development and growth of the new town? Should it not be part of the director's job to do such things? Will the Minister take action?
    Mr. Watts: The instructions and guidance to the franchising director include the fact that, in assessing franchise bids, he should take account of pledges to improve services over and above those included in the passenger service requirement and the existing BR timetable. The hon. Gentleman will know that, in the majority of the 13 franchises that have been let, new private sector franchisees have pledged to extend services rather than reduce them, as Opposition Members had alleged would happen.

    Transport Expenditure (London)
    Mr. Congdon: To ask the Secretary of State for Transport how much was spent on (a) roads and (b) public transport in Greater London in 1995–96. [4005]
    The Minister for Transport in London (Mr. John Bowls): Spending comes from a variety of public and private sources. In 1995–96, those included Government grant of £904 million to London Transport, £37 million to the docklands light railway, £124 million to local authorities, £13.5 million to the Traffic Director for London and £220 million to the Highways Agency.
    Figures for Railtrack and the Office of Passenger Rail Franchising in Greater London are not identified separately.
    Mr. Congdon: I very much welcome the significant investment there has been in public transport in London, particularly the money spent on the underground and the Jubilee line extension, as well as the commitment to spend £125 million on Croydon light rail. Does my hon. Friend agree that it is also important, particularly in south London, to ensure that access to the motorway network is improved—not so much by building new roads as by significantly improving the existing transport infrastructure to maintain the competitiveness of centres such as Croydon?
    Mr. Bowis: My hon. Friend is right: it is important to ensure the smooth running of our roads. We shall certainly
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    bear in mind the fact that one of the most important ways of achieving that end involves the red route network, which will enable the orbital routes to flow more freely. My hon. Friend is also right to pay tribute to the high level of investment in public transport in London—four times more in real terms has been invested this year in London Transport than in 1979. Substantial progress has been made under this Government. In the past hour, we have been able to announce that the Croydon tramlink deal has been signed and will proceed.
    Mr. Cohen: The stop-go building of the M11 link road through Wanstead and Leytonstone has caused considerable inconvenience to local residents, is an environmental eyesore and has created crime traps. The Highways Authority has ruled out the possibility of environmental compensation for the area. Will the Minister accept that that is unreasonable and will he consider the possibility of environmental compensation?
    Mr. Bowis: The hon. Gentleman pays tribute to the Government's plan to improve London's roads, particularly the M11-Hackney link. I do not think that I heard him pay tribute to the fact that, in the past couple of weeks, the go-ahead for the last two sections of that road has been announced—his constituents' problems should be moving towards a resolution. The hon. Gentleman may want to have a word with his own Front-Bench team, who have imposed a moratorium on all new road building.
    Mr. Evennett: I, too, welcome the figures that my hon. Friend has given this afternoon. Is he aware that people in my constituency are demanding a balance between road and rail expenditure and are looking to a new crossing of the Thames between Woolwich and Dartford? When will he be able to say more about those issues?
    Mr. Bowis: My hon. Friend is right to say that river crossings are important to his constituents and to many others. He will know that a package of river crossings, including Woolwich, Gallions Reach and Blackwall, is being carefully examined as part of the infrastructure that London needs to be effective. If he has read today's Evening Standard—I believe everything I see in that—he will know of the welcome news that we have given the go-ahead for the escape ramp for the Blackwall tunnel, which will also be good news for those trying to get across the river in an efficient and effective way.

    Congestion (London)
    Mrs. Bridget Prentice: To ask the Secretary of State for Transport what estimate he has made of the annual cost to business of congestion in London. [4006]
    Mr. Bowis: We have made no such estimates.
    Mrs. Prentice: Is that not a limited and disgraceful answer from the Minister? Does he not agree that London is in virtual gridlock most of the working week? Apart from the air pollution, effects on health and general inconvenience for travellers, does that not have a devastating effect on London's businesses? Is it not now time to have an integrated transport strategy for London?
    Mr. Bowis: Again, the party that says it will have no more roads building and that has announced today that it

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    will have no more new underground lines either is not the party that should be talking about congestion in London. We are, of course, aware of the needs of businesses and, indeed, of other people seeking to get around our city and we have been taking action throughout our years in office to do something about the issue, not just carrying out surveys. In fact, it would be difficult to identify the criteria needed for the sort of assessment that the hon. Lady seeks.
    As for good news for those concerned about congestion, I should have thought that the hon. Lady would spring to her feet to welcome the progress of the docklands light railway down to Lewisham—her part of the world—and the fact that, once the Jubilee line extension is built, those extensions will connect at Canary Wharf. That will provide relief for her constituents, which will enable her to join the executives of Europe, who have highlighted London as their favourite city and its transport as one of the reasons for that.
    Mr. Dunn: May I first make it plain that we do not want another river crossing in Dart ford, thank you very much? Is the Minister prepared to consider greater use of the River Thames, greater use of park-and-ride facilities and greater use of light transit railways in south London in particular? Will he accept our congratulations for doing all that he can to speed up traffic on the A2, a subject which is down in my name for debate later this week?
    Mr. Bowis: I will certainly take note of my hon. Friend's wish not to have the new river crossing to Dartford, even if it were to come from Woolwich, as my hon. Friend the Member for Erith and Crayford (Mr. Evennett) suggested earlier. I will not prejudge the debate later this week, but my hon. Friend the Member for Dartford (Mr. Dunn) is right to highlight the need for us to continue to work in partnership with the local authorities, the Highways Agency, the highways authorities, London Transport and others to make sure that, in his part of London and the south-east and in areas that others of us represent, we have an efficient traffic and transport system that continues to ensure that London is a powerhouse of the British economy.
    Ms Glenda Jackson: Has it escaped the Minister's notice that his party has been in government for the past 17 years? It is their abject failure to create a properly integrated transport system for London that has produced ever-greater congestion on London's streets and ever-higher levels of air pollution and which prompted the Corporation of the City of London to state only last year that transport issues are a key competitive threat to London's economic position. What, in their dying days, do his Government intend to do to ensure that London's economic future is not threatened by their failure in the same way as they significantly threatened its past?
    Mr. Bowis: As the hon. Lady moves into her next period of opposition, I hope that she will learn to pay tribute and give credit where it is due to a Government who have been investing in London's infrastructure to an extent far greater than previous Labour Governments could have dreamt of. I have mentioned the fact that, this year, London Transport is investing in real terms four times the amount invested in 1979, the year in which the Conservatives came to office.
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    Even excluding the Jubilee line extension, in real terms we are investing twice what was invested in the 1980s and three times what was invested in the 1970s. The Opposition can only come up with a policy of no spend on roads and no spend on new rail lines but, instead, the promise of a Thames tax, so Londoners will know that they will pay through the nose in Labour's taxes and get nothing in return.
    Mr. John Marshall: My hon. Friend will agree that public transport plays a major role in reducing road congestion in London. Can he therefore comment on the article in today's Evening Standard, suggesting that there will be no new trains on the Northern line until September 1997, which would mean that GEC was much too far behind schedule, and which would make many of my constituents and many commuters in London very angry indeed?
    Mr. Bowis: My hon. Friend is right to draw attention to the fact that, thanks to the private finance initiative, new trains will be coming on the Northern line, serving his constituents and mine. It is equally right to say that there have been delays in those trains' manufacture. They are now starting to come through for trials, and they will be in service by next summer, as promised by London Transport—or according to the understanding that I have from London Transport.

    Fishing Vessel Safety
    Dr. Godman: To ask the Secretary of State for Transport what plans he has to modify the rules and regulations governing the occupational safety of the crews of United Kingdom-registered fishing vessels. [4007]
    Sir George Young: The occupational safety of crews in United Kingdom fishing vessels is being pursued through the development of regulations to implement EC health and safety directives.
    Dr. Godman: I know that the Secretary of State has an abiding concern for the safety of fishermen. Does he agree that, when a fishing vessel must be abandoned and the crew forced into the water, crew members stand a far greater chance of survival and rescue if they are wearing survival suits—that is, if they have had time to don them? Why is the Department of Transport reluctant to introduce a regulation governing the carriage of such survival suits on all UK-registered fishing vessels? Is that not the case with the European Union's directive on occupational and safety matters relating to fishermen? Why not give owners and skippers a one-off grant to purchase such suits?
    Sir George Young: I hate to challenge what the hon. Gentleman said, because I respect his knowledge of these matters, but my information is that the existing international and European obligations do not require the carriage of immersion suits. None the less, that would clearly be valuable in the circumstances that he outlined, and my Department will shortly promulgate a recommendation that fishermen should wear an automatic single-chamber inflatable lifejacket when working on deck.
    Mr. Waterson: Does my right hon. Friend agree that the Government have done a great deal to enhance the

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    safety of not only fishing crews but all crews operating in UK waters, especially by stepping up inspections of vessels calling at ports in this country and publishing lists of so-called ships of shame?
    Sir George Young: Yes, indeed. That is a valuable initiative, which the Department introduced two or three years ago. We do detain ships when they do not reach the right standards, we publicise their names to exert peer group pressure and we keep the vessels until such time as the necessary repairs have been carried out.

    Vulnerable Road Users
    Mr. Flynn: To ask the Secretary of State for Transport what action he plans to implement the recommendations of the third report of the Transport Select Committee of Session 1995–96, HC373, on risk reduction for vulnerable road users. [4008]
    Mr. Bowis: The Government's response to the Transport Committee's report on risk reduction for vulnerable road users was published on 12 November.
    Mr. Flynn: The Committee strongly recommended that the Government publicise the dangers of aggressive bull bars and specifically recommended that the Department write to all owners of fleets of vehicles on which they are fitted, not only to warn them of the dangers to other road users with whom the bull bar vehicles might collide but to emphasise the added dangers to the drivers and other occupants of the vehicles on which they are fitted. Have the Government done that?
    Mr. Bowis: I share the hon. Gentleman's and the Committee's concern about aggressive bull bars. I should like to go much further than he suggests and have aggressive bull bars banned. I tell the hon. Gentleman that straight. The way to achieve that is to do as we are doing now—work with the European Commission to design a directive on standards for such items. We are making good progress in that respect. Britain is leading the way and I hope that, before long, we shall achieve what the hon. Gentleman and I both want.
    Mr. Matthew Banks: Following publication of the most recent report by the Transport Select Committee on risk reduction for vulnerable road users, may I congratulate my hon. Friend on the meetings that he has held with motor cycling organisations and the Motor Cycle Industry Association? Given the importance of increasing car and lorry drivers' awareness, will he give his continued backing to the recommendations in the "Think Bike" campaign in Motor Cycle News?
    Mr. Bowis: Yes. I am grateful to my hon. Friend for his kind words about my meetings with representatives and journalists from the industry and I pay tribute to his work in ensuring that those issues are kept before us, as he rides around on his bright red motorbike. We must continue to pay attention to this matter. Motor cycling is an effective way of reducing congestion on our roads, but it must be done safely. We are tackling that by ensuring that motorbike riders ride safely, are properly trained and are capable of coping with the power with which they deal at different stages in their biking careers, and by
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    ensuring that other road users are aware of motor cyclists' needs, particularly by observing them. Being seen and seeing are part of the package that we seek to achieve.
    Mr. Donald Anderson: Did I overhear the Minister say that he was in favour of banning bull bars? Has he thought of pressing the Government on that issue?
    Mr. Bowis: I said clearly that I want to move towards a ban on aggressive bull bars. I believe that the House would support that. I also said that the way to achieve such a ban was by reaching agreement on a European directive, which is necessary if we are to tackle these matters. We have made good progress and I hope that, before long, we shall see the desired result.

    Speed Cameras
    Mr. Mark Robinson: To ask the Secretary of State for Transport what assessment he has made of the effect of speed cameras in reducing accident rates. [4009]
    Mr. Bowis: A cost-benefit analysis of traffic light and speed cameras in 10 police force areas, commissioned by the Home Office and carried out between November 1995 and March 1996, identified a 28 per cent. fall in accidents at speed camera sites—[Interruption.]
    Madam Speaker: Order. The Minister is answering the hon. Member's question. Other hon. Members should be helpful on such occasions and not pass between the Member and the Minister.
    Mr. Bowis: The report identified a 28 per cent. fall in accidents at speed camera sites and an 18 per cent. fall at traffic light sites.
    Mr. Robinson: I congratulate my hon. Friend on those results. I understand that the Government's policy is to target speed cameras on particularly dangerous stretches of road. May I draw my hon. Friend's attention to the A303 between Sparkford and Podimore, on which the West Camel parish council has made representations through me to the Minister for Railways and Roads? It is recognised as a dangerous stretch of road and we hope that it will soon be turned into a dual carriageway. In the interim, however, will the Department look at the matter again to see whether a speed camera could be installed in the hope that it will cut the accident rate, as there have been some awful accidents there in recent years?
    Mr. Bowis: I am grateful to my hon. Friend. He is right to pay tribute to the effectiveness of cameras when they are put in the right place. That is made possible through the good partnership between local highway authorities and the police.
    The aim of installing the cameras is to deter inappropriate speed, rather than to catch the speedsters. In addition to the reduction in accidents to which I referred, speed at those points has reduced by an average of 4.2 mph. That is good for road safety and, with my hon. Friend, I shall look into the case in Somerset.

    Rail Privatisation
    Lady Olga Maitland: To ask the Secretary of State for Transport if he will make a statement on privatisation plans in relation to rail services. [4010]
    Sir George Young: Rail privatisation is progressing extremely well. About 70 per cent. of the rail industry has been transferred to the private sector, generating some £4.5 billion in proceeds for the Exchequer. Thirteen passenger rail services are now in the private sector, the Cross Country franchise is expected to be awarded shortly and the remaining 11 are all on course to be awarded in this financial year. All British Rail's former domestic freight businesses are now in the private sector. The international freight operation, Railfreight Distribution, is expected to be sold at the turn of the year.
    Lady Olga Maitland: I hope that my right hon. Friend's plans include a scheme to privatise London Underground. That would provide an opportunity for investment to extend the line from Morden to Sutton in my constituency, which would be widely welcomed. Is he aware how successful the privatisation of Network SouthCentral has been and how popular it is with my commuters, who find that 90 per cent. of trains now arrive on time? Is it not a pity that Labour so bitterly opposes privatisation, putting ideology before passenger interests?
    Sir George Young: I was delighted to hear from my hon. Friend of the success of privatisation in her constituency. She is right to remind the House that punctuality on South West Trains mainline services has improved by more than 3 per cent. since franchising. As The Daily Telegraph commented last Friday:
    "Privatised trains run on time more often".
    My hon. Friend will recall that our right hon. Friend the Prime Minister said at Bournemouth that we are seeing whether the principles behind privatisation can be applied more widely, in particular to London Underground.
    Mrs. Dunwoody: We are all delighted to know that the Secretary of State, like Mussolini, wants to make the trains run on time. Is he aware of the great disquiet in my constituency because the new director of Opraf is allowing tenders for the line on the basis of the existing timetable, which has been shown to contain more than 100 errors? If the tendering is going ahead before the consultation exercise, how genuine is his commitment to the interests of those who use public transport?
    Sir George Young: The consultation on the draft passenger service requirements is genuine. As the hon. Lady knows, following consultation, changes have been made to the draft PSRs and improvements have been made. I have no doubt that when the west coast main line is franchised, her constituents and the constituents of Chester and of other constituencies on that line will experience the benefits of our privatisation policy.
    Mr. Rowe: Having spent several years dismally failing to persuade British Rail to provide any new rolling stock on my local railway, may I say how delighted my commuters are at the promise in the new owner's franchise agreement that they will shortly enjoy the benefits of new rolling stock?
    Sir George Young: My hon. Friend is right to point out that there has been some £400 million of new
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    investment in rolling stock in that franchise—further evidence that privatisation will allow higher investment than a public sector railway would have. Given his efforts to persuade British Rail, he will be interested to learn that the latest figures show that rail complaints fell by 25 per cent. in the first half of this year, I hope that that means that he will get fewer letters of complaint in his postbag.
    Mr. Llwyd: On Wednesday last I travelled on the 9 am train from Paddington to Cardiff. I arrived 45 minutes late on a two-hour journey—which is typical, I suppose. When I arrived, I was told that there were sheep on the line, and I subsequently heard that the same sheep had delayed the 8 am service. When I went to catch the 4.25 pm return, I was told that it had been cancelled five minutes earlier. I asked whether the sheep were still active and was told that there had been no interference by sheep that week. That is a newly franchised service, and it is not very good, is it?
    Sir George Young: It is a better service than was provided by British Rail. Great Western is already refurbishing several trains, and privatisation will result in more services from Paddington to Cardiff. Therefore, there is less risk of being delayed by sheep.

    Industrial Action (London Transport)
    Mr. Nicholls: To ask the Secretary of State for Transport what is his estimate of the loss of income to London Transport caused by the recent strikes. [4011]
    Mr. Bowis: London Transport estimates that its loss resulting from the recent strikes is about £15 million.
    Mr. Nicholls: Bad though that figure is, does my hon. Friend agree that behind it lies much inconvenience and the real misery of those who tried to use London Transport? Does he further agree that those commuters were entitled to expect the Labour party's outright condemnation of the strikes, but heard instead only the sponsored silence of the shadow Cabinet?
    Mr. Bowis: My hon. Friend is right. Throughout the summer, while Londoners suffered from that wholly unnecessary strike action, we were more likely to hear the scrunch of Opposition Members wandering the beaches of Benidorm in their designer clothes than a single squeak on behalf of anguished Londoners. I hope that the Opposition will take the opportunity to condemn, even retrospectively, that strike and the disruption that it caused.
    Mr. Tony Banks: No one could accuse the Minister of wearing designer suits. However inconvenient strikes on London Transport may be, at least they are predictable—commuters know that the trains will not run that day. If the Minister travelled on London Transport, he would realise how appalling the service is in terms of daily inconvenience to Londoners. On that subject, when will he explain what happened last week when the entire underground system closed down—the second time that Lots road power station has completely packed up in recent months? What went wrong? Will there be an inquiry and when will the Minister apologise to Londoners?
    Mr. Bowis: The hon. Gentleman would certainly hear the sand scrunch if I walked on it. He is one of the few

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    Labour Members to comment on the strikes that crippled Londoners' ability to travel to work during the summer. We have heard nothing about it from the current Opposition Front Benchers or their predecessors, but it is time that we did because Londoners are waiting to hear whether the sponsored silence will be the pattern for Labour and strikes.
    London Transport has made clear to the people of London its regrets and apologies for that late-night disruption, which, it has stressed, had nothing to do with investment but was caused by a problem with a valve turning off the power for 10 minutes. During that time, it could not get Greenwich station up and running, so the system was transferred to the main stream and it began to work again, causing minimum disruption and inconvenience. Trains were running by the end of the night and everything was in order for the next morning.
    Mr. Harry Greenway: My constituents suffered a great deal as a result of last week's underground shutdown. Does my hon. Friend share their concern and anger that Labour Members speak up about that incident, which lasted for only a few hours on one day, but do not speak against strikes that last for many days and cause much more distress, anger and disruption? Where are their values?
    Mr. Bowis: My hon. Friend is right. London Underground is investigating the incident and what may be done to prevent any repetition. However, we may compare that small incident, which lasted only a few hours, with the 1.6 million tube passengers whose lives and journeys to work were disrupted by the underground strike, week after week, while the Labour party said nothing.

    Congestion Costs
    Mr. Callaghan: To ask the Secretary of State for Transport if he will make a statement on the costs of traffic congestion to British businesses. [4012]
    Mr. Watts: There is no generally accepted definition of congestion costs, and my Department does not publish estimates.
    Mr. Callaghan: I thank the Minister for that answer, but is he aware that, according to Confederation of British Industry estimates, congestion on the M25 costs businesses £1 billion and nationally it costs them £19 billion? What will the Government do to alleviate the worries of the CBI and the nation?
    Mr. Watts: We are aware of the parts of the network that suffer congestion and our well-targeted trunk road programme is designed to relieve the most severe congestion points. We are also applying modern technology to enable us to manage the network better, part of which will be the strategy that I announced last Monday for the development, under the private finance initiative, of regional traffic control centres. That will allow for the strategic management of motorways and trunk roads over a much broader area.

  HOUSE OF COMMONS

    Renovations
    Mr. Wareing: To ask the Chairman of the Finance and Services Committee what representations he has received in respect of expenditure on renovations in the Palace of Westminster during the summer recess. [4032]
    Mr. Paul Channon (Chairman of the Finance and Services Committee): I have received one representation.
    Mr. Wareing: In these times of cuts in social benefits, and when local authorities cannot get the resources to provide proper community care, was it not exorbitant for the House to spend £17 million, including £6 million on the kitchen in the Members Cafeteria? Every summer recess, the interior of the House resembles nothing more than one huge building site, and much of the work is repetitive and unnecessary. Is it not a higher priority to provide an escalator for elderly members of the public who have to tramp huffing and puffing up the stairs to reach the Strangers Gallery?
    Mr. Channon: I quite understand and share the hon. Gentleman's desire for as much economy as possible. He must realise that what he proposes was fully debated in the House on 12 July 1994 and carried unanimously. We could not have continued without being closed down eventually, as we were clearly defying health and safety regulations. Everything that is done in the House is much more expensive than it would be elsewhere because this is a grade I listed building.
    Sir Colin Shepherd: Does my right hon. Friend agree that it is right that the House should no longer hide behind Crown immunity and that it should face up to its responsibilities, and that much of the expenditure incurred to which the hon. Member for Liverpool, West Derby (Mr. Wareing) referred was related to improving the conditions of those who work in the Palace? Should we not comply with the legislation with which we make others outside comply?
    Mr. Channon: I agree.
    Dame Elaine Kellett-Bowman rose—
    Madam Speaker: We must now return to Transport questions and to Question 12 from Sir Mark Lennox-Boyd.
    I call Mr. Jim Cunningham on Question 13.
    Dame Elaine Kellett-Bowman: On a point of order, Madam Speaker. I rise because of the other question.
    Madam Speaker: Order. We always return to the original questions when we have finished.
    Dame Elaine Kellett-Bowman rose—
    Madam Speaker: Order. Question 28 was withdrawn. We now return to Transport questions. Sir Mark Lennox-Boyd is not in his place; Mr. Jim Cunningham is.
    Dame Elaine Kellett-Bowman: I was rising for Question 27, Madam Speaker.

  TRANSPORT

    Departmental Rail Investment
    Mr. Jim Cunningham: To ask the Secretary of State for Transport what sums his Department has invested in (a) the west coast and (b) the east coast lines in the past three years. [4014]
    Mr. Watts: Railtrack is responsible for investment in rail infrastructure and has confirmed that investment in the west coast main line for each of the financial years since 1994 totals £168.6 million. It plans to spend £1.35 billion to renew the core infrastructure and is prepared to spend an additional £150 million on a passenger upgrade. The east coast line was upgraded in 1991–92 at a cost of £550 million. Railtrack has not, therefore, had to inject major investment subsequently.
    Mr. Cunningham: As the west coast main line is of strategic national importance, will the Minister assure the House that it will be given a full upgrade to ensure maximum efficiency?
    Mr. Watts: The £1.35 billion core investment programme and the £150 million upgrade programme announced and agreed by Railtrack shows the high priority that is given to this nationally significant route.
    Mr. Devlin: As a regular traveller on the east coast main line, may I tell my hon. Friend how pleased I was that the punctuality of trains has improved dramatically since it was privatised and taken over by Great North Eastern? A much wider and better range of services is available for passengers on the east coast main line, which is yet another benefit of privatisation.
    Mr. Watts: My hon. Friend is right to draw attention to the substantial improvement in services provided by Great North Eastern.
    Mr. Bradley: When will work to upgrade the west coast main line begin? Will the Minister assure us that it will be a full upgrade and not just a modernisation of the line, and that it will include the feeder lines—such as the Northampton to Birmingham line—into the west coast main line? Will he also assure us that the infrastructure will be fully developed to ensure the maximum use of freight on projects such as piggyback? When will he announce which franchisee will operate the line?
    Mr. Watts: Contracts to develop signalling systems have already been let and are central to the core investment programme. It is expected that physical works on the upgrade will begin early in the new year. It would be premature for me to announce the identity of the franchisee; the announcement will be made in the usual way by the franchising director. The hon. Gentleman will
    16
    have heard my right hon. Friend say that Railtrack has not yet concluded its work on identifying the possibilities for freight upgrading on the line.

    Driving Licences
    Mr. Donald Anderson: To ask the Secretary of State for Transport if he will make a statement on progress on including a photograph of the holder on driving licences. [4016]
    Sir George Young: With the Driver and Vehicle Licensing Agency, we are reviewing the timetable for the introduction of photographs on driving licences.
    Mr. Anderson: Will the Minister confirm that no further legislative action is required in respect of photocard driving licences? Following his visit, he must be aware that in Morriston in my constituency great investment has been made in the relevant machinery and that people have been trained and are ready to go. When will he give the off?
    Sir George Young: On the first question, the hon. Gentleman is correct: no further legislation is required for photocards on driving licences. On his substantive point. my right hon. and learned Friend the Home Secretary announced in August that, following public consultation, the Government had decided that the planned plastic photocard driving licence linked to a voluntary identity card would be available. We had previously secured an amendment to the EU directive to allow that. It was announced in the Queen's Speech that a draft identity card Bill would be published this Session.

    Bus Services
    Mr. Hanson: To ask the Secretary of State for Transport what has been the change in the number of bus passenger journeys made outside London since 1985–86. [4017]
    Mr. Watts: There were 4,489 million passenger journeys on local bus services outside London in 1985–86, and 3,178 million in 1995–96.
    Mr. Hanson: Is not it a disgrace that there has been a massive fall in the number of bus journeys outside London since the Government introduced deregulation? Do not those figures clearly show that privatisation has failed, that deregulation has resulted in fewer journeys, poorer services, higher costs and poorer vehicles, and that re-regulation is urgently required?
    Mr. Watts: No; if the hon. Gentleman studied the trends over a longer period, he would find that the decline in bus usage has been running at about 4 per cent. per annum since the 1970s. In recent years, the rate of decline in bus usage has been arrested. He mentioned inferior vehicles. Reference was made to the significant orders placed by Stagecoach. I have now recalled the figures: the order is for 1,000 new buses in the first tranche, followed by a further 650.

    School Transport
    Mr. Bennett: To ask the Secretary of State for Transport what estimate he has made of the number of children travelling to school by car in (a) 1979 and (b) 1995. [4025]
    Mr. Bowis: It is estimated that, on average, some 2 million children aged five to 15 travelled to school by car during the period 1993–95. Figures are not available for 1979.
    Mr. Bennett: Do we not have a vicious circle? The more parents take their children to school by car, the more danger there is from traffic around school gates, which pushes more people into the same process. What is the Minister going to do to reverse that process, and to try to ensure that our streets are safer so that more children can walk to school?
    Mr. Bowis: The hon. Gentleman is right. We believe that more children could walk to school if the routes to school were made safe. To that end, we are working with organisations such as Sustrans and local authorities to ensure that routes are safe—by means of, for instance, lighting, signing and design—and that children are taught how to walk safely to school. If we do that, and encourage schemes such as the 20 mph zones that are being introduced around some school gates, we can increase the number of children—53 per cent.—who still walk to school.

  HOUSE OF COMMONS

    Parliamentary Questions
    Mr. Gunnell: To ask the Lord President of the Council what assessment he has made of the consequences for the procedures of the House of the recommendations of the second report of the Select Committee on Public Service of Session 1995–96 (HC 313) in respect of the answering of parliamentary questions. [4036]
    The Lord President of the Council and Leader of the House of Commons (Mr. Tony Newton): The recommendations of the Public Service Select Committee, and the Government's responses, bear on how parliamentary questions should be answered. They have no direct implications for the procedures of the House.
    Mr. Gunnell: I thank the Lord President for his answer. Does he not agree, however, that, after considering the history of parliamentary questions and their use sometimes as a game, the Select Committee felt that the purpose of such questions was to hold the Executive to account, and pointed out that they should be answered—adding that, when they were not answered, an explanation should be given? Indeed, the Government agreed with the Select Committee.
    Will the right hon. Gentleman draw the attention of the Prime Minister and other Ministers to the fact that parliamentary questions should be answered, and point
    18
    out that words should not be used to pretend that an answer has been given when even simple answers such as "Yes" and "No" are frequently avoided?
    Mr. Newton: The hon. Gentleman will know that my right hon. Friend the Chancellor of the Duchy of Lancaster has responded to the reports to which he refers in, I think, very positive terms, seeking to clarify the basis on which parliamentary questions are answered. I hope that that will help the House, but I will draw what the hon. Gentleman has said to my right hon. Friend's attention and, as he asked, to that of my right hon. Friend the Prime Minister.

    Adjournment Debates
    Mr. John Marshall: To ask the Lord President of the Council how many subjects have been raised as Adjournment debates since January 1995. [4037]
    Mr. Newton: Since January 1995, there have been, as of Thursday 21 November 1996, 288 daily and 275 Wednesday morning Adjournment debates initiated by individual hon. Members.
    Mr. Marshall: I thank my right hon. Friend for his answer, which demonstrates the increased time available for Back Benchers. Would he care to note the debate on legal aid that I have initiated, which shows that the legal aid fund is a juggernaut out of control? Will he accept my assurance that, if the Chancellor of the Excqhr and the Chief Secretary to the Treasury attack it tomorrow, there will be a warm welcome from me and from many others?
    Mr. Newton: My hon. Friend is certainly right that there has been a large increase in the number of opportunities available to Back Benchers, particularly through the introduction of Wednesday morning debates in exchange for Consolidated Fund debates and some private Members' debates at other times during the week. I am sure that my right hon. and learned Friend the Chancellor of Exchequer and my right hon. Friend the Chief Secretary will have heard what he said about legal aid and will have noted it carefully. More to the point, I am sure that my noble Friend the Lord Chancellor has carefully noted my hon. Friend's concern about these matters.

    Overseas Development Questions
    Mr. Foulkes: To ask the Lord President of the Council what recent representations he has received concerning the time allocated for questions on overseas development. [4038]
    Mr. Newton: I have received none recently. I hope that that is short enough for the hon. Gentleman.
    Mr. Foulkes: I have an interest to declare in the matter. Will the Leader of the House confirm that representations have been made through the usual channels? Is it not ridiculous that we had 10 minutes for questions to the Chairman of the Finance and Services Committee and only one question was asked and answered, but that we have only 15 minutes for Overseas Development

    19
    questions, with dozens of hon. Members queuing to ask questions and a Department of State involved? Will he consider the matter urgently?
    Mr. Newton: There are two or three points. This question is linked with a question further down the Order Paper which is unlikely to be reached and to which I am not unsympathetic. It was not so long ago that Overseas Development questions were extended from 10 to 15 minutes. On some subjects, related matters would be in
    20
    order at Foreign and Commonwealth Office questions, but I am not dismissing the hon. Gentleman's point out of hand. It is getting a bit late in this Parliament to make significant changes to the question rota.
    Dame Elaine Kellett-Bowman: On a point of order, Madam Speaker.
    Madam Speaker: I shall take it after the statement.

EMU Regulations
3.30 pm
The Chancellor of the Exchequer (Mr. Kenneth Clarke): With permission, I should like to make a statement on the regulations governing economic and monetary union.
In the past few days, some highly misleading claims have been made about the draft legislation for the detailed preparation of economic and monetary union. They culminated in the misrepresentation of a series of documents in The Sunday Times yesterday.
I am strongly in favour of full parliamentary debate and scrutiny of those important issues. That scrutiny must be properly completed before any decisions are made that might have binding effect on this country. What the whole House must want is an informed debate at the right time, rather than one based on inaccuracies and innuendo.
That is why today I want to clear up the misconceptions and to clarify the issues and the procedures involved. My right hon. Friend the Leader of the House will in due course make an announcement about the form and timing of the debate, which must certainly come before the Dublin summit. I repeat that no binding decisions will be taken in any forum or were ever likely to be until that debate has taken place.
Last week, European Standing Committee B considered the latest relevant documents that should be subject to parliamentary scrutiny. It had all the up-to-date relevant legislative documents before it. They were commissioned at the Florence summit in June and cover the legal status of the euro, the proposals for a new voluntary exchange rate mechanism of the European monetary system, and the stability pact designed to provide a mechanism to help to ensure that participants in stage 3 of EMU do not run an excessive deficit.
I have written to every hon. Member setting out the facts about those texts. [HON. MEMBERS: "No."] I have. The logistics, I gather, have not ensured that every hon. Member has them yet, but a large number of copies of those letters are in the Whips Offices of both sides of the House and, I believe, have been for some considerable time. I have today arranged for further copies of the letter to be deposited not only in the Whips Offices, but in the Libraries of both Houses. I stand by that letter and I believe it to be accurate in every respect. I do not propose to read out the details of the letter, but I should like again to underline four key points about the draft European Union legislation.
First, the opt-out from EMU that the Prime Minister negotiated at Maastricht remains entirely unaffected. Secondly, everything contained in the EU stability pact, including fines on ins, derives from and was foreshadowed in the Maastricht treaty. Thirdly, unless we join stage 3 of economic and monetary union, we shall retain, as now, control of domestic economic policy. We would still have our existing commitment to endeavour to avoid an excessive deficit, but there is no question of any fines or other sanctions being imposed on us for running an excessive deficit.
I know that some colleagues have raised the possibility that recital 13 of the draft regulations strengthening surveillance could be used to impose policy obligations or sanctions that can be binding on member states.
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That interpretation is incorrect. Article 103(5) can be used to impose only detailed rules as to procedure. Any recommendations that might be made under article 103(4) are non-binding.
Finally, the stability pact makes good economic sense for the United Kingdom and for Europe as a means of ensuring that EMU is soundly based, whether we are in or out of a single currency. If we are in, we need to ensure that no other member of EMU falls into excessive deficit or debt crisis, which might tend to drive up interest rates. If we are out, we need the euro zone to be stable, as the British economy is more successful when the economies of our major customers are successful. That is why I am negotiating so toughly in the Economic and Finance Council in British interests to get the details right. That is why Parliament must scrutinise properly what I am doing.
I have always accepted that such documents should be subject to the House's rules on scrutiny. I have no choice but to accept it, but I accept it extremely willingly; I am in favour of those procedures. Since the scrutiny procedure will not have been completed by the time the ECOFIN Council of Ministers meets on Monday 2 December, I shall maintain a scrutiny reserve at that meeting. There is nothing new or exceptional about that—scrutiny reserves are often entered into by Ministers at many Council meetings. I was quite clear in every discussion that I had with hon. Members and others last week that I would maintain the scrutiny reserve in this matter until the proper process was completed. That means that nothing of substance can now be settled at next Monday's ECOFIN meeting.
I come to the documents referred to in yesterday's edition of The Sunday Times. The first is a briefing note that was prepared at the request of the European Union Commissioners, Sir Leon Brittan and Neil Kinnock. It was designed to help them be aware of British views at an early stage of the negotiations before the Commission's thinking on the stability pact was finalised. The note was requested by them and sent to both of them in confidence. The reason why it was in confidence is that European Commissioners are constitutionally independent, although I am quite sure that other Commissioners regularly receive briefings from other Governments.
As someone—I believe that it was the right hon. Member for Dunfermline, East (Mr. Brown)—has seen fit to break that confidence and put the document in the public domain, I have today decided to release it. I am actually happy to do so because it confirms that, throughout the negotiations, I have shown proper regard for the interests and procedures of Parliament and a desire to achieve a sensible and acceptable outcome on the stability pact. In fact, I particularly rely on the document that I sent to the two European Commissioners. When I sent it, I never expected that Parliament would see it. The document therefore shows that, at the beginning of October, in private as well as in public, I was particularly anxious to preserve the freedom of nation states to control their own economic policies, and particularly anxious to protect this House's position and its parliamentary procedures. I hope that releasing it does not weaken my negotiating position in the Council, because it contains nothing that other Finance Ministers do not now know about the positions that I am holding in the Council.
The paper states:
"the current proposals will not he acceptable to Parliament."

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That was correct at the time. The whole point of the document, as hon. Members will see when they read it, is that it was sent before the Commission tabled its proposals. The paper makes it quite clear that I was concerned about certain proposals that we feared that the German and French Governments might be making to the Commission. It transpired that we were largely mistaken about the French position. In fact, the German position in negotiation has been much more reasonable than we then feared.
When the Commission later tabled its proposal, in the form of the papers that European Standing Committee B had before it last week, it reflected British thinking to a much greater extent than we expected. In particular, it preserved the key principle of political judgment by Ministers being applied before any fines would be imposed on any member state that had joined EMU. In itself, the Commission proposal that we now have will and can settle nothing. It provides a basis for further negotiation and eventual settlement at the European Council—perhaps, but not certainly, in Dublin. I would welcome the views of the House about the position that we should take in those negotiations.
The second document is from the European Monetary Institute, which comprises all the central bank governors of member states and is sometimes regarded as a precursor to a European central bank. It is not a Commission document or a Council document. Nor does it have any legal effect. It is advice on policy sent to the Council of Ministers in confidence.
I was not able to communicate that document officially because of its declared confidential nature. However, in order to ensure that the House was well informed on its substance, I wrote on 31 October, describing the main points, to the hon. Member for Clydesdale (Mr. Hood), who is the Chairman of the Select Committee on European Legislation. That EMI paper has now been widely quoted in the press and I therefore decided to release it today. Hon. Members will be able to see for themselves that my summary of 31 October sent to the Chairman of the Select Committee was accurate.
The document gives opinions and advice on how, in the opinion of central bank governors, a so-called mark 2 exchange rate mechanism for member states outside an economic and monetary union might operate in practice and how the monetary stability of the whole Union might be safeguarded in future. The EMI document makes it quite clear that membership and even co-operation on exchange rate matters will remain voluntary. The conclusions of the Florence Council, repeated by the EMI in its document, stated of any exchange rate mechanism that "Membership would be voluntary."
The EMI document also says:
"Such closer co-operation would be concluded on a voluntary basis at the initiative of the individual non-Euro area Member State."
Article 109m of the Maastricht treaty already states that exchange rate policy is
"a matter of common interest."
That is of course sensible policy, as wild exchange rate fluctuations would be disruptive to trade in the single market. Actually, that provision about exchange rate policy being a matter of common interest goes back to the treaty of Rome.
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At Monday's meeting of ECOFIN, I do not expect and I never have expected any items of EMU legislation to come up for formal adoption. At ECOFIN, we will however seek in good faith to reach a broad measure of political agreement as we were mandated to do by the Florence summit. I will maintain the scrutiny reserve to any political agreement that may be reached. The results of discussion at ECOFIN will be available to inform the European debate in this House before the Dublin summit. That meeting in Dublin is the earliest occasion on which any binding decision could be requested.
There are two possible futures for this country. First, at some stage in the future, we might move to the third stage of EMU and adopt a single currency. As the Government have always made clear, there could be advantages for this country in such a move—[Interruption.] Those who are interested will take the feeling of the voices. If we ever move to the third stage of EMU, the associated legislation on the details of EMU must be sensible and effective and suit British interests. That is why it is so important to maintain our ability to participate in and contribute to the negotiations now. They would represent part of the legislative base on which any future British Government might enter EMU. They are part of the detail to be settled before we form our views on the way in which we should exercise our option. We must never repeat the mistake of abdicating from European negotiation so that the structures are designed to meet only the interests of other member states.
Secondly, we might always remain outside a single currency. [HON. MEMBERS: "Hear, hear."] Under those circumstances, we will ensure that we retain, as now, complete control of domestic economic policy and that we are not made subject to any new, binding legal obligations that go beyond non-binding recommendations of the kind to which we have already been subject, under the treaty and in practice, for the past four years. That is the approach that I have been adopting throughout all the negotiations. Whether we are in or out, my concern is and will remain to respect the position and traditions of this Parliament and our independent nation state.
Mr. Gordon Brown: The muted cheers when the Chancellor mentioned the case for a single currency and the jeers from the Conservative Benches when he mentioned the case against a single currency showed exactly why the Conservatives never wanted a debate. The Chancellor's problem is that every time he tells us what is on the Finance Ministers' agenda for next Monday—the euro, the stability pact, the budget and exchange rates and exchange rate co-operation—he demonstrates precisely why all parties represented on the Select Committee on European Legislation and hon. Members of all parties in the House were absolutely right to unite to demand a full debate on those matters before the meeting. They are still right to do so. The purpose of the Government's statement today is that the House should hear the views of the Chancellor, but surely the whole purpose of a debate is that the Chancellor should hear the views of the House.
The test of the Chancellor's main assertion today—that nothing of substance will be decided on 2 December—is not in the repetition of that assertion, but in the precision of the specific answers that he gives. How does he square his claim that nothing of substance can be decided with the fact that in his letter on 31 October to the Chairman

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of the Select Committee on European Legislation, he said that political agreement is likely on 2 December, and with the fact that the documents that he gave to the Select Committee state that the Government will participate in political decisions on them at the ECOFIN Council on 2 December? Why did the Leader of the House say that scrutiny would have to be completed by the end of November, because that would be in time for the House's views to be taken into account in any decisions at the 2 December meeting? Surely the main point of the Chancellor's letter of Friday is that, with or without a security reserve—[Interruption.] Conservative Members should listen. The Chancellor's letter of Friday said that on 2 December we might reach a broad measure of political agreement.
The Chancellor has confirmed that papers on exchange rates will be discussed at the meeting next Monday. Will he confirm that—in addition to what he says about the proposals in those papers—there is now a proposal in the European Monetary Institute document that the exchange rates of all the outs will be monitored and assessed, and a further proposal that, where convergence is achieved, countries can be expected to enter ERM mark 2? If, as the Chancellor admitted in his letter of Friday, a broad measure of political agreement might be reached on those issues next Monday, surely that is a matter on which we should hear the Government's position, on which the opinions of Members of this House should be heard and on which we should see the paper that is now before the European Ministers?
If, as the Chancellor confirmed today, the meeting next Monday will discuss both stability plans for the ins and convergence plans for the outs, and as stability plans are, as everybody knows, important even to the countries that remain out; if there is a set of proposals for every one of those inside currency union that the deficit should never be higher than 3 per cent., that it should never be more than 1 per cent. over the cycle and that it should never be considered exceptional unless there is a specified reduction in national income in any one year; and if, as the Chancellor says in his letter, a broad measure of political agreement is likely on 2 December—including on the subject of fines for the ins—surely we should know as a matter of fact what is finally being proposed and whether the Chancellor considers the rules to be too rigid or inflexible. Surely the House should be allowed to give its views on the matter, too.
The Chancellor says that the convergence plan does not include fines—which is right—but also says that it is a requirement only for information and for nothing more, but surely he must explain the proposals that are before his meeting next Monday. As I understand them—I hope that he will confirm this—Britain would be compelled to submit a convergence plan, which the Treasury accepts may yet have to include forecasts on interest rates and unemployment. Britain would then be assessed and judged on the credibility of its economic position and on whether it was meeting the criteria. Britain might then be urged to take corrective action, and given a specified time to do so. The Chancellor must surely explain the fear expressed by the Treasury that those plans go way beyond the provision of information and involve what it calls pre-commitments to respond to changes in the deficit.
The Chancellor says that no agreements have yet been made. Perhaps he will explain why the informal meeting of Finance Ministers in September agreed that there was
26
a broad level of consensus that convergence programmes should be made obligatory and that their contents should be developed along the same lines as for stability programmes. The Chancellor should explain why one thing is being said in Brussels and another back here in Britain.
Try as the Chancellor might to downplay 2 September and to say that nothing of substance is being decided, he cannot do so. Is it not the case that there is only one reason for denying us the debate that the House and the country want—internal Tory party management? On that and on the other issues, the national interest should come first.
Mr. Clarke: On the final point, I can assure the right hon. Gentleman that the policy that I am pursuing is the declared policy of the Government. As I tried to explain, I am pursuing it in a way that I am perfectly happy to debate. It is important to us all and I am happy to make it clear.
On the decisions that will be taken next Monday at ECOFIN, I anticipate that the most likely outcome will be a report to go ahead to the summit in Dublin on where we are in the discussions on all those things. It is possible that we shall seek to reach political agreement on that and other things. I made it clear a few moments ago that, until we have finished the scrutiny procedure here, I shall put in a parliamentary reserve—something that frequently happens in the Council.
The right hon. Gentleman referred to the way in which I described the matter to the Scrutiny Committee in my letter of 21 October, when I said:
"the Government will be participating in the formal completion of the process at ECOFIN on 2 December and the European Council on 13 and 14 December."
After the conclusions at Florence, no member state is assuming that ECOFIN will determine the final shape of those things or legislate—there are to be no legislative proposals. ECOFIN is meant to be trying to reach political agreement to go on to Dublin, and I shall enter a parliamentary reserve to that.
Mr. Dennis Skinner: Hoodwinked.
Mr. Clarke: No. Let me quote again from the letter to the Chairman of the Scrutiny Committee. I said that the letter,
"by providing you with advanced warning, will help to ensure that your Committee is fully able to feed in its views on these proposals in time for the Government to participate in political decisions on them at the ECOFIN Council meeting on 2 December and the European Council on 13 and 14 December".
I went on to say:
"I attach great importance to the role of Parliament in scrutinising European business".
That is why I sent the letter and why we still have plenty of time before any of the matters are resolved in the meetings.
Let me say what might prevent political agreement from being reached at ECOFIN and in Dublin. Important matters, particularly in the stability pact, would affect us if we were to go into economic and monetary union at any time. It is important that the fines should not be so excessive as to make the economic crisis worse, that the process should not be automatic and that it should be

27
subject to political decisions by the Council of Ministers at every stage. It is important that the timetable should not be so rapid as to ratchet up a problem to a crisis in one member state. The fines and penalties in the treaty were intended to act as a deterrent but, like all the best deterrents, they would be a deterrent that would never be imposed because they would put pressure on a member state to get back within the excessive deficit.
That is the position that is being taken, and the process will not be concluded next Monday—it was always highly unlikely that it would be concluded next Monday and I am not even sure that it will be concluded at Dublin. I shall put in a parliamentary reserve on those matters until the House is satisfied and its scrutiny process finished. [Interruption.] I have always been clear about that. I have never had the slightest intention of going to any Council of Ministers without the parliamentary scrutiny process being completed.
The right hon. Gentleman also referred to the European Monetary Institute document. That document has no legal effect, and the right hon. Gentleman does not do a service to sensible debate by misquoting or by distorting quotations. It is an inescapable fact that he ought to accept that the EMI is proceeding on the only sensible and true basis: that a country joins ERM mark 2 only if its Parliament decides to. The Prime Minister and I have repeatedly made it clear that we have no intention of proceeding to ERM mark 2.
It is not true that convergence plans can lead to the conclusions that the right hon. Gentleman said they could lead to; they can lead only to non-binding recommendations. It is true that we are contemplating the idea of it being compulsory to submit such plans, but this country has been submitting them for three or four years, they have been approved every year in Parliament, and we have never had back a recommendation that did not endorse our policy; so there is no great threat posed there.
Other member states that might get themselves into fiscal problems have had a habit in the past of submitting inadequate plans and submitting them late, so there are some attractions, if one wants stability in the single market, to getting the conversion programmes sorted out. However, I agree with the right hon. Gentleman about matters such as forecasts of interest and exchange rates, and I do not think that they will survive.
Finally, the right hon. Member for Dunfermline, East talked about the need for a debate. I have made it absolutely clear that we will have a debate. [HON. MEMBERS: "When?"' I welcome a debate; 1 enjoy the debate. The right hon. Gentleman says that he is looking forward to an interesting debate between me and my Back Benchers; I think that he will have some fun with some of his, if we ever get to a debate, not least because I am not the slightest bit aware of his position on any of those matters at any stage.
My right hon. Friend the Leader of the House will in due course announce the terms of the debate—perhaps a longer debate—that we hope to have; it will certainly be held before the Dublin summit, on a motion for the Adjournment.
Mr. Tom King: Will my right hon. and learned Friend confirm that, since before the European
28
Community was even thought of, this country has had the closest interest in the performance of the economies in Europe, and that it would be grossly irresponsible on his part and on the Government's if we did not recognise that it is absolutely vital, given that the euro and monetary union will be introduced among our most important trading partners, to ensure that they are set up on a basis that works? Will he again confirm that we shall ensure that our independence and our right to decide about our own economy, as long as we so choose, are properly preserved?
Mr. Clarke: I agree with my right hon. Friend; he makes an extremely important point. The continental markets are our most important markets, and our well-being is linked to theirs, with the result that when Germany and France are successful, we are successful, and when they get into economic difficulties, we slow down. It is therefore extremely important that in our single market we participate in discussions on a euro zone, even if only others will be in it; instability and failure in that part of the market have a knock-on effect on us.
I confirm entirely what my right hon. Friend said in his final point: I am not engaged in secret or evasive negotiations; I answer parliamentary questions every time I come back from ECOFIN; I submit piles of documents to the Scrutiny Committee, and huge mountains of them fly out and get overtaken the whole time; I am quite open about what I am negotiating for; and I negotiate in line with the policy of Her Majesty's Government—no more and no less.
I am determined to ensure that, unless we go into the euro zone, we shall retain complete control, as now, over our national economic policy, and that if we go in, we shall not be sucked into a system that goes beyond what is envisaged in the treaty and imposes unacceptable restraints on our independence as a nation state.
Mr. Malcolm Bruce: Does the Chancellor accept that it is welcomed on the Liberal Democrat Benches when he declares that, regardless of whether Britain joins monetary union, if it goes ahead, it is in our interest to ensure that it is a success? Will he nevertheless acknowledge that the House has to some extent exercised a scrutiny reserve on him and his Government, in that it is difficult to believe, given that the ECOFIN discussions are to go forward as proposals to the summit, that ECOFIN has no substantial influence on the shape of the possible proposals?
Will the Chancellor give the lie to the suggestion made by one or two of his Government colleagues that the discussions do not matter, because monetary union will affect only the member states that join it, given that his and the Government's position is that the United Kingdom may well be a founder member of monetary union?
Those who are opposed to our membership of monetary union should realise that the terms and conditions regulating how members of EMU operate are bound to be the basis of how they conduct themselves in relation to states that remain outside. Either way, the conditions are vital to our national interest.
Mr. Clarke: I agree with the hon. Gentleman. Under the treaty, we have a right at any time in the foreseeable

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future to exercise an option to go into economic and monetary union. That means that we are now negotiating the legislation that will apply—would apply—whenever the United Kingdom exercises that option, under whatever Government. Therefore, it is extremely important that we make a positive contribution to that. We must avoid the mistakes of the past. We would not have the common agricultural policy that we now have if a former generation of politicians had not taken the utterly bizarre view that it would never affect the United Kingdom, so they pretended that it was not going to happen and left it to be set up on a basis that no one in the House thinks is any longer satisfactory.
For the reasons that I have given my right hon. Friend the Member for Bridgwater (Mr. King), it is equally important that, if we stay out, the euro zone is a stable element in the middle of our European Union and single market, and there are not destabilising consequences from it. I shall seek to ensure that as well.
As I made clear, I give descriptions to the Scrutiny Committee of documents that, strictly speaking, perhaps I should not be giving. I go beyond what
is absolutely necessary for scrutiny sometimes. What I ask is that, while I submit myself to scrutiny, one cannot keep ringing up from ECOFIN at every stage of the negotiations to try to keep Parliament covered. One must understand how we negotiate. I would rather that other member states did not know at every stage exactly what I was pushing for, exactly what I was going to withdraw, what I really meant, what was a try-on and what I was actually trying to secure. A process of permanent parliamentary debate, permanent parliamentary scrutiny and occasional parliamentary hysteria is not always in the national interest.
Mr. Norman Lamont: May I thank my right hon. and learned Friend for his statement? As someone who helped to negotiate the opt-out at Maastricht in addition to the Prime Minister, might I say to my right hon. and learned Friend that I agree with his interpretation? I believe that he is correct to say that fines would not apply to us provided that we did not join the single currency. I agree with him that the monitoring of our economy by the European Commission will not in any way interfere with the ability of the British Government to conduct our own economic policy.
To that extent, our opt-out remains intact, but my right hon. and learned Friend has made it clear this afternoon, and on many other occasions, that he would quite like to join the single currency. If that happened, the fines and the scrutiny would apply to us. The House is entitled to debate the level of the fines and the flexibility and the inflexibility of the system. That has not been debated adequately so far, until this afternoon. If it had been, this needless row would have been avoided.
Mr. Clarke: My right hon. Friend did a very good job, as he did on many other things, in his negotiations on the opt-out at Maastricht. I have never had the slightest trouble with the provisions of the treaty as we now have them. The treaty always envisaged that at some stage we would move to detailed regulation making of the kind that we are now engaged on. The treaty always envisaged, and we accepted it in our negotiations, that for the ins there would a system of deposits and fines. The detail of that still has to be negotiated. I entirely accept that that is something that the House should scrutinise and consider.
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As I said in my statement, I welcome the views of the House. I revealed, as the documents that I sent to the Commissioners revealed to everyone, that I have been arguing throughout that the fine should not be excessive. We do not want bovine spongiform encephalopathy crisis-type financial obligations falling on a country that is already struggling to cope with an excessive deficit. I have argued that, as one goes down that path, the procedures should be reasonable and flexible, and at all times should be under the political control of the Council of Ministers.
I suspect that my right hon. Friend and the bulk of my right hon. and hon. Friends would agree with me on those points. I am—or was—making good progress on those matters in the Council, and I was also making good progress in the Commission—perhaps it has influenced matters. When I wrote to the Commission, I thought that something closer to the more rigid, automatic procedures of other member states would emerge, but what emerged was nearer to our procedures. It was still not perfect and I welcome the House's scrutiny of those procedures.
Mr. Peter Shore: The Chancellor has certainly not reassured me with his statement. His statement this afternoon that he would put a reserve on any detailed agreement reached does not go far enough. He has reaffirmed today what he said in his letter on Friday: the purpose of the meeting on 2 December is to reach an agreement. He has reaffirmed that he will seek to reach a political agreement on 2 December and that that will form a report to go to the European Council 13 days later, or whenever it is. The fact that on 2 December the Chancellor will reach a political agreement on the report's general shape raises the question of what is being agreed—what is being agreed is the idea of a stability pact.
Is the right hon. and learned Gentleman really saying that he, as Chancellor of the Exchequer, is prepared in future—we all know that he wants to join the single currency—to have the Budget judgment made for him in Brussels rather than here in London? Is he prepared—like a rate-capped local authority—to have fines imposed on him because he has dared to exceed the limit of the 3 per cent. ceiling on gross domestic product? I find that shameful.
The Chancellor mentioned the EMI report and tried to describe how it came about—I accept that. Is it true that that report contains a recommendation that in future Britain should force the pound sterling to shadow the euro, and that arrangements will be put in train to bring that about? If that is so, we shall find ourselves without the advantages that we would otherwise enjoy were our currency not absorbed into the euro.
Mr. Clarke: Any political agreement will be subject to parliamentary scrutiny reserve until we have satisfactorily completed parliamentary scrutiny. The political agreement that is likely to be reached is on a report that will set out member states' differing positions. What I expect now is what I expected before. We shall proceed and seek to resolve—indeed, we have a mandate to do so—as many of the difficulties as possible, but not to resolve them finally—we never intended to do that.
The next step will be for ECOFIN to do the best that it can to resolve the disagreements and forward them to Dublin, where they might or might not be agreed—all that

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is subject to scrutiny reserve. It is true that the stability pact is being contemplated—in particular, members that are in may find themselves subject to fines and penalties. It has always been true that the Maastricht treaty contemplated that those in economic and monetary union would be subject to deterrent penalties, to ensure that they all continued to follow the convergence criteria once they had joined. I am in favour of that, and most people looking at economic and monetary union think it sensible.
It is no good aspirant member states hitting a target in the relevant year—particularly if they fiddle it—and then assuming that they can satisfactorily proceed with economic and monetary union, without keeping within those convergence criteria. The treaty as drafted by my right hon. Friend the Member for Kingston upon Thames (Mr. Lamont) always contemplated pressures to ensure that members stayed within the convergence criteria. I agree with the Germans on the principle and I also agree that they should not fudge the convergence criteria. My position is that I would expect myself to be against this country joining economic and monetary union if the criteria were fudged, or if there were not adequate guarantees that we would stay convergent after we had joined, because the whole thing would set up intolerable pressures and this country would be much better out of any such arrangement if it went ahead.
Finally, there is no question in the EMI document of shadowing the euro or any other currency. Sterling is now a floating currency and I have no intention of shadowing any currency as long as it remains floating, because it would be futile and damaging to do so.
The right hon. Gentleman's other points might be clarified by a little internal debate in the Labour party—it gets fairly bewildering, seen from Conservative Benches.
Mr. John Butterfill: As it seems likely that the pound will not join the euro in the first wave, at the very least, can my right hon. and learned Friend share his thoughts with us and give us an unequivocal assurance on whether he is likely, at ECOFIN or subsequently at Dublin, to be asked to agree to anything that could impose penalties on our economic behaviour in the future? Can he confirm that the maintenance of the convergence criteria—in other words, keeping inflation down and restricting public spending to a reasonable proportion of gross domestic product—is desirable in itself and is likely to continue for as long as the Conservative party remains in government?
Mr. Clarke: On the first point, I can confirm that, if we do not join stage 3, article 103 does not allow any fines or penalties to be imposed upon us—under article 104, those fines and penalties fall only on those that have joined stage 3. The British opt-out, as negotiated by my right hon. Friend the Prime Minister, preserves our indemnity from those fines and penalties.
On the convergence criteria, such as the excessive deficit procedure, which we have been following for two or three years, I agree strongly with my hon. Friend that we on the Conservative Benches do not think that it is good economic policy to run a deficit above 3 per cent. of gross domestic product. We do not think that it is in this country's interests to have a debt:GDP ratio of above
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60 per cent. We intend to be a low-inflation economy. We believe that complying with those convergence programmes—if we do, which is a matter for us—is a sign of economic health, whether anyone is thinking of a single currency or not.
Mr. Tony Benn: Is the Chancellor aware that the real issue is a slightly different one? If the stability pact is agreed, it will come into force only if Britain joins a single currency; but it pre-empts a decision of a future Government and a future Chancellor, refreshed by the mandate of the electorate, when the decision comes to be made. By agreeing in principle what are called fines, but which are really the taxation of this country by the European authorities, he is transferring in advance the power to tax this country from the Treasury, which he heads and which can be removed, to people who are not accountable to Parliament. That is the issue.
If the Chancellor really thinks that he can present this as only a little detail, he misses the whole point. If he thinks that a single currency guarantees unity, he should remember that the dinar did not guarantee the unity of Yugoslavia, the dollar did not prevent the American civil war and the rouble did not prevent the break-up of the Soviet Union. He must be living in a dream world, motivated solely by the idea that a single currency is a guarantee of peace and unity, which it is not.
Mr. Clarke: On the first point, the penalties and disciplines imposed on those that go into economic and monetary union are in the Maastricht treaty under article 104. The right hon. Gentleman voted against the Maastricht treaty and I quite understand that. All I can tell him today is that the negotiations in which I am involved add nothing by way of fines and penalties beyond what is contemplated in the Maastricht treaty, which this House discussed two or three years ago.
The Maastricht treaty paves the way for the regulations, in the same way as our social security legislation in this House eventually paves the way for regulations on the practical implementation of what has been agreed. The large issue of principle that the right hon. Gentleman raises is important, but the House has already looked at it once and we have bound ourselves by treaty. All I can tell him is that the process in which I am currently engaged and which is now being scrutinised adds nothing to that, in the sense that it is all based on the Maastricht treaty, which has been through the House.
I agree with the right hon. Gentleman on his second point; I do not believe that currency unions guarantee political union and so on. I do not believe that that is the best argument for currency union; it is not the reason why I believe that we should keep our option open one way or the other. It could be an extremely misguided way of trying to pursue political union. There are many other ways in which peace, harmony and the correct defence of genuinely common interests among countries should be pursued.
Economic and monetary union is essentially an issue concerning how the single market will operate, how we shall preserve stability in future, whether it is desirable to seek to go into a single currency to preserve the most stable conditions and what the political or other price will be if one does that.

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The next big question cannot be settled until we have finished negotiating all those details—and I am not running away from the House having a debate or a discussion about that and contributing to that very important issue.
Mr. John Redwood: On Thursday, in the House, the Prime Minister said that the regulations would not apply to the United Kingdom unless we were joining the single currency. Will the Chancellor ensure that such words are written clearly on the face of each regulation, so that there can be no more legal doubt? Our record before the European Court of Justice is very disappointing, and there are different legal views about the current loose wording.
Mr. Clarke: I explained that I believe that what the Prime Minister said was the correct statement of the position, but obviously I undertake to my right hon. Friend that I shall respond to all the anxiety that has been expressed at the weekend and in the House today about whether we can be absolutely sure that that is the case. The Commission proposals that we have before ECOFIN were in any event put forward only for the Council of Ministers to negotiate on that basis.
It is often not understood in this country that the Commission does not decide such things. In that specific area, the Commissioners are the servants of the Council of Ministers, and they act as such. We asked the Commission to try to take things forward by producing some draft regulations, and then I sent briefing to our Commissioners and so on to try to ensure that what they came forward with was rather nearer to my position than I feared it might otherwise be. We then intended to carry on negotiating to get the text right.
In the light of all the fears that have been expressed, I assure my right hon. Friend that I shall seek to come back with the best possible text that puts, as he says, absolutely beyond doubt what I already believe to be genuinely the case, but I agree that it must be seen to be copper-bottomed, or as copper-bottomed as we can get it.
Mr. Alfred Morris: The Chancellor said it was his purpose this afternoon to clear up all the misconceptions. Was not one of the main misconceptions that of the Prime Minister in claiming last Thursday—and repeatedly—that there had already been full parliamentary scrutiny in European Standing Committee B?
Mr. Clarke: There was scrutiny in European Standing Committee B, and I can say only that when one—
Mrs. Ann Taylor indicated dissent.
Mr. Clarke: Well, there was scrutiny. I regard myself as a parliamentarian as least as much as I am a Minister, but we all know that, if things are reserved to a Committee, it is up to the hon. Members to decide how they use the time on that Committee. I was not there, but I gather that a very good time was had by all; some process of scrutiny was carried forward at the time. It has not been completed. We know that it has not been completed because a motion has yet to be carried.
With the greatest respect, in my opinion, we do not need all these wrangles about parliamentary procedure; what we want is a debate, which the Government are
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undertaking to give. My right hon. Friend the Leader of the House will in due course make a business statement about the form of that debate, to which the Government are committed.
Sir Terence Higgins: May I welcome my right hon. and learned Friend's statement? Does he agree that, if the Government were now to rule out membership of EMU in the next Parliament, it is likely that he would find that he was largely excluded from the discussions or that the real decisions would take place elsewhere? Is it not very important that he should take full part in those discussions, not least in emphasising that, if other members of the Union fiddle the convergence figures, as is clearly the case in France, and probably Belgium and Spain, a rush towards a core currency will end in disaster and its disintegration, and the whole process will be set back for a generation?
Mr. Clarke: I could say that I agree entirely with every point that my right hon. Friend has made. At times, I find myself trying to win points that are not the first points of preference of other member states. My ability to win those points is greatly reduced if the other member states all take the view that it is academic for us in any event because we shall not be members, and that gives others greater influence. I happen to think that, in the national interest, it is wrong to exercise our option anyway because it is too soon to determine which way the national interest will lie.
Some of my right hon. and hon. Friends—not my right hon. Friend the Member for Worthing (Sir T. Higgins)—are irreconcilably opposed to our ever joining at any stage. Nevertheless, they cannot guarantee that, in 10 years' time, this House, which is sovereign, will not decide under some Government or other to go in. I want British influence to be the maximum in those negotiations, because they will result in the legislation, whether that option is exercised sooner or later.
I very much agreed with my right hon. Friend's last point. When deciding whether countries are convergent and ready to join economic and monetary union, the Commission makes a report on whether, in its opinion, sufficient member states satisfy the convergence criteria. The European Council—that is, the Heads of Government—then decides, by qualified majority vote country by country, whether a particular country meets the conditions for membership. In my opinion, it should take that decision not on fudged attempts to meet the criteria but after a genuine wide look at whether that country can take on the constraints of economic and monetary union and continue to comply with convergence. It must look at reality, not patent accounting devices, when and if that decision is taken.
I certainly agree with my right hon. Friend. I have said this before and have probably not repeated it for a bit: convergence is more important than the timetable from the point of view of every member state in the Union. I am firmly on that side of the argument.
Mr. Giles Radice: Does the Chancellor agree that, whether or not Britain joins EMU—I share the Chancellor's position on that

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question—it is in Britain's interest for there to be a strong euro, which requires sensible rules, including a stability pact between members?
Mr. Clarke: I agree entirely. It is important to have a proper process of parliamentary scrutiny but we must conclude it satisfactorily, because, for all the reasons that we have been exploring, there is an overriding national interest in getting it right. However, as any negotiator would say, the process of scrutiny must not totally confine the negotiator's ability to say or do anything in the course of discussions. I like to think that I sometimes come away with a good deal from negotiations, but I shall not come away with the best deal if the House insists on imposing a total constraint on any movement whatever from the position that I take.
Mr. William Cash: Does my right hon. and learned Friend accept that, given the economic policy laid down in article 102 of the treaty, we are bound to be affected by the proposals, even if we are out? Does he further accept that, if the countries that are in are fined, our taxpayers, who are net contributors, will end up paying into the European coffers one way or another? Does he therefore accept that we must go to the European Council meeting and veto the regulations unless the Council is prepared to guarantee that we shall not be affected by them? For the reasons that I have given, we need a crystal clear exclusion from the regulations.
Mr. Clarke: I am extremely reluctant to contemplate vetoing one of the regulations requiring unanimity. Again, it is all subject to parliamentary scrutiny. It is extremely important to sort out now the regulation which I would describe as the legal base of the euro, which provides for continuity of contracts—those contracts already in existence, which are denominated either in ecu or in currencies that might go into the euro. There is a great deal of commercial interest in the City of London to get that matter resolved as quickly as possible, and to have legal certainty governing existing contracts and the legal rules applying to every member of the Union. I was among those who pressed for retaining unanimity and, under the relevant article—number 235, I think—for requiring unanimity to apply to all member states, and I keep pressing for a decision to be taken as quickly as possible. Subject to what my hon. Friend might say to me afterwards, that is the firm view of interested parties in the City of London.
With regard to my hon. Friend's earlier reference to an article, the regulation is under article 103, which cannot lead to fines and penalties, but can lead only to non-binding recommendations.
My memory is failing: I have forgotten my hon. Friend's third point.
Mr. Cash: Will my right hon. and learned Friend veto the regulations unless we get an explicit guarantee that we shall be excluded from them?
Mr. Clarke: I shall certainly veto or vote in every way to confirm the policy that I have described. That is what I continue to do. We must address what is actually being proposed, not what we fancy is being proposed or might
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be proposed, although of course we must guard ourselves against future risk. Those risks can be satisfactorily answered.
Mr. Alan Williams: I accept that it has all along been the Chancellor's intention to protect the procedures of this House. Does that not make even more inept the action last Thursday of the Prime Minister and, more sadly, of the Leader of the House, in ruling out immediately the possibility of a forthwith motion? Secondly, as the Chancellor has said repeatedly today that he wants the opinion of the House, and as he knows full well that even in a two-day debate, at most 10 per cent. of the House will have a chance to participate, does he not recognise that the only way to get that opinion is in the Division Lobbies, with individual votes on the individual components in the package?
Mr. Clarke: The matter of a forthwith motion will be addressed in due course by my right hon. Friend the Leader of the House in a business statement. I accept that the motion must be taken at some stage to complete the process of parliamentary scrutiny, but as the right hon. Gentleman knows—he has been in the House longer than I have—we are arguing about a take note motion. If the House decides that it does not want to take note of documents, the outside world, away from the hothouse of Westminster, will find that slightly bewildering.
My right hon. Friends the Prime Minister and the Leader of the House are anxious to give the House a proper opportunity for debate. The difficulty with a debate, as the right hon. Gentleman said, is that there is a limit to the number of Members who can take part. That is why the House has the Scrutiny Committee, which allows everyone to go—[Interruption.] I admit that it is a new process, so I have not participated in one. I am told that the scrutiny process involves the Minister attending, and being subjected to repeated and lengthy questioning in depth on the technical details of the regulations.
We shall then move to a debate. My right hon. Friend the Prime Minister made it clear that we must have a debate before Dublin. We always have a debate before we go to a European Council. I have already said that the business managers are contemplating whether it would be possible to make room for an extended debate.
Mr. David Hunt: Will my right hon. and learned Friend accept my congratulations on having put the record straight this afternoon in a clear, concise and comprehensive statement? Will he confirm that nothing has been done, is being done or will be done that will fetter the right of the United Kingdom, under the opt-out so successfully negotiated by our right hon. Friends the Prime Minister and the former Chancellor, to make our own decision in our own time about whether to join economic and monetary union and the single currency? Finally, will he ensure that, until he has received a satisfactory explanation of what went wrong, no further confidential papers will go to Commissioner Kinnock's office?
Mr. Clarke: I can confirm the first part of the question. The Maastricht opt-out remains completely untouched by what we are considering. It will remain untouched and I have no doubt that the House will debate it many times hereafter.

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On the latter point, I have no means of knowing where the document came from, as it was sent to both Commissioners. I had to take the decision whether to send it to one British Commissioner—Sir Leon Brittan—or to both, including Neil Kinnock. I decided that the national interest required me to send the document to both Commissioners and their chefs de cabinet, personal and in confidence. I have no idea how it has reached the outside world. The fact that the right hon. Member for Dunfermline, East revealed it and was waving it about, makes me think that Sir Leon Brittan is probably in the clear. I shall certainly consider what briefing I put forward to anyone in Brussels in the near future.
Mr. Denzil Davies: The Chancellor told us that he loves debates, but he seems to be shy of votes. Will he give an absolute assurance that, before Her Majesty's Government sign a binding agreement on the stability pact, the details of that pact will be brought to the House and hon. Members will have a chance to vote on it specifically and, if necessary, approve or reject it?
Mr. Clarke: The form and nature of debate is not for me—[HON. MEMBERS: "Yes."] It is not. This is not a business statement and it is no part of my duties to give such a statement. I look forward to debate and we must have a proper debate. No doubt, many hon. Members have views about the form of that debate, all of which will be listened to by the business managers. After some process of consultation, my right hon. Friend the Leader of the House will make a proper statement in due course.
Several hon. Members rose—
Madam Speaker: Order. This statement has now been running for an hour and only 12 Back-Bench Members have been called, largely because questions are much too long, too many questions are being put and the answers are equally long. I need now brisk questions and answers.
Mr. David Heathcoat-Amory: This unnecessary row could have been resolved much earlier by the granting of a full debate about an issue that the Prime Minister has described as the most important decision facing the country.
Does my right hon. and learned Friend the Chancellor agree that some of the draft or proposed regulations are intended to apply to countries that do not join a single European currency? If that is the case, will he undertake not to agree to any further strengthening or widening of this country's obligations if we do not join a single European currency? Will he maintain that position if and when the House resolves to take note of the regulations?
Mr. Clarke: I hear what my right hon. Friend says about debate. We always intend to have a full debate, and we always do, before we go to the European Council. Given the current position—it is quite plain that nothing will be settled at ECOFIN; I do not think that anything legislative was ever going to come from it—we must now consider the proper form of debate before the Dublin summit, which is the next place where agreement might be reached.
Some regulations certainly apply to non-members of EMU—things such as the excessive deficit procedure have applied for two or three years; in so far as they have
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changed, they will apply to us. What will not apply to us are the fines and penalties and those parts of the stability pact, because they apply only to members of stage 3. I signify to my right hon. Friend that I will not enter into more obligations binding to this country of any kind, unless and until we complete the process of parliamentary scrutiny.
Mr. Nigel Spearing: If the Chancellor is enthusiastic about both scrutiny and debate, why have he and the Leader of the House, who foreshadowed such a debate in his letter, not allowed it to take place this week? When will they table the requisite motion under Standing Order No. 102(9)? Why might that not occur this week? Will the one-day debate on a motion for the Adjournment, which the right hon. Gentleman has promised, take place after possible political agreement has been reached? Is that not shutting the stable door moments after the horse has bolted? How can an Adjournment debate, without a proper amendable motion, be regarded as, first, proper scrutiny; secondly, proper debate; and, thirdly, an expression of the views of the House on the merits of the documents?
Mr. Clarke: My right hon. Friend the Leader of the House is listening to the various views expressed about a debate and the form that it will take, and he will make a statement in due course. My Budget and the debate that follows it will take up a substantial amount of parliamentary time this week. I have made it clear that, until we have completed the scrutiny process, any political agreement that I enter into in ECOFIN will be hedged with the parliamentary scrutiny reserve, which means that it is non-binding and subject to the approval of Parliament.
Mr. Tim Renton: I congratulate my right hon. and learned Friend on his lucid statement.
Is not the real reason for the passion that has led to this mini-debate the fact that hon. Members on both sides of the House are beginning to learn that, whether or not we are in EMU, we shall have to learn to live with it, and it is that knowledge that is making a number of hon. Members wish to have an urgent debate on the Floor of the House? Is not the crude fact that, as 60 per cent. of our manufactured exports now go to our European trading partners, any failure in European markets would be very bad news for British manufacturers? Against that background, is it not in Britain's interest to see that the financial rules governing a stability pact are as tough as possible?
Mr. Clarke: I agree with my right hon. Friend. It would be a great folly for us to seek to detach this country, for some reason, from the process of discussion of this kind inside the European Union when we are so dependent on the major countries of the Union for our exports, as my right hon. Friend describes. He gave one analysis as to why we are having those misunderstandings, and he is right. Another reason, of course, is that there is so much detail in the regulations. They are about as exciting a read as the social security regulations that flow through the House, and they give plenty of opportunity for people to take little bits out of them and get wildly excited that something new is happening.

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That process is not helped by Her Majesty's press, which does that all the time—[Interruption.] I have been brought to the House today by weekend newspaper reports written by journalists who—[Interruption.] I do not mind coming to the House at any time. I have come to the House because of reports that appear in the newspapers, which have been written by people who appear to have copies of those documents, who produce front-page stories that do not bear the faintest resemblance to the leaked documents that they allegedly have. That rather confuses debate as far as the public, and sometimes the House, are concerned.
Mr. Ted Rowlands: Will the Chancellor answer the question that was put to him earlier? If he and the Government are to agree to a stability pact, will he seek the approval of the House before doing so?
Mr. Clarke: I shall go through the scrutiny procedure—[Interruption.] I am not in control—[HON. MEMBERS: Oh!"] I know that I am. I know that we have not finished the scrutiny procedures. I have repeatedly said that, and I have said that I will keep a reserve until we have finished the scrutiny procedures. The form by which we go through that is not a matter for me, and my right hon. Friend the Leader of the House will make a statement about that in due course.
Mr. Quentin Davies: Does not the whole of this saga demonstrate in the most graphic and dramatic fashion how enormously important it is, in the interest of the country, that we continue to exercise a full measure of leverage on events? Is it not the case that, had my right hon. and learned Friend and the Prime Minister given in to the rather hasty pressures to which they were being subjected a few months ago—to throw away our option—there would not be the slightest point in the statement this afternoon or any scrutiny debate because we would not in practical terms have the slightest influence on the decisions, vital though they will be for our country, whether or not we decide to join monetary union?
Mr. Clarke: I agree. I would have thought that every hon. Member on both sides of the House, whether he or she regards himself or herself as Europhile or Europhobe or anywhere in the spectrum between, would agree that it is not in this country's interest to detach British Ministers from the process of discussion and negotiation inside the European Union. Whatever future one sees for this country inside the EU, it is absolutely important that we keep our influence, and it is particularly important that we keep our options open on such vital matters when all the key details have yet to be settled.
Mr. Dennis Skinner: Does the Chancellor of the Exchequer not realise that he has been dragged to the Dispatch Box—the phrase that he almost used—in a humiliating fashion a day before the Budget partly because of the Government's failure to see what was happening when the three proposals were put to the Committee upstairs? Anybody who went up there that Wednesday morning would have known exactly what was
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likely to happen. The Government have had half a dozen different positions in the past three or four days, so do not blame the press. Most of all, since Maastricht, the vast majority of the people outside—electors—are against the single European currency, and that is being reflected in the House. Why? Because they had a taste of it. On 16 September 1992, the Tory Government, the Prime Minister and the previous Chancellor of the Exchequer lost £10 billion in an afternoon because of the exchange rate mechanism, and they never went near a betting shop.
Mr. Clarke: I decided to come to the Dispatch Box when I realised that the debate was spiralling off who knows where. The matter was reported in ever more extravagant ways outside the House. I am happy to come to the House, and prefer to do so, to answer all points. I am told that the hon. Gentleman passed through the Standing Committee for a few moments. I look forward to seeing him try to catch your eye in the debate, Madam Speaker. It seems to me that he has not had the slightest change of opinion on this or any other subject for the past 25 years, and it is always welcome to hear his views again.
Sir Peter Hordern: Is it not a delusion to suppose that any future British Government will have the freedom to run a substantial budget deficit without incurring high interest rates? Is it not, therefore, all the more important that we play a part in shaping the rules that will govern the powerful European currency that is certain to emerge?
Mr. Clarke: My right hon. Friend is right. Nowadays, any major country that pursues irresponsible deficit or fiscal policies is rapidly punished by the markets and by reality. The problem that arises from economic and monetary union is that everyone is punished if one country goes off the rails and runs irresponsible policies. The treaty wisely provides deterrent penalties to keep any Government who fail to correct that problem back on track, otherwise all members of the economic and monetary union will suffer.
Mr. Kevin McNamara: Is the Chancellor of the Exchequer aware that those of us who favour a single currency, and would like this country to join on the first wave, are nevertheless worried about two important matters? First, reports on the criteria for convergence give us to believe that there will be a loose organisation for the first tranche, which could be an enormous disaster for the economic basis of the European Community. Secondly, many hon. Members believe that the matters that went before the Scrutiny Committee should be decided on the Floor of the House, as the Scrutiny Committee itself resolved. The three issues could be debated and put to the vote on the Floor of the House so that, if the vote were in favour, the Chancellor could go to the summit with the support of the House, and would not have to come back to tales of treachery and treason and a hysteria that he and his colleagues have whipped up.
Mr. Clarke: I agree with the hon. Gentleman on the first point. It is highly desirable for the member states that go into economic and monetary union not to do so on such a loose basis that their economies are not genuinely convergent. I am in favour of a strict interpretation of the convergence criteria.

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On the hon. Gentleman's second point, the many views that have been put forward in this exchange of questions and answers will be considered by my right hon. Friend the Leader of the House when he makes his statement.
Mr. Robert Jackson: Does my right hon. and learned Friend agree that, in a single market, Britain would have a right to be concerned if one of our partners were pursuing a policy of gaining competitive advantage by devaluations? By the same token, would it not be legitimate for our partners to have an interest in limiting the scope for competitive devaluations?
Mr. Clarke: It would be an absolute disaster for the single market if individual member states decided that they would gain a trading advantage by competitive devaluation. I do not think that they would get a lasting advantage, but if a member state tried that, it would cause considerable disruption to trade. That is why the treaty of Rome, to which we have been subject for more than 20 years, regards exchange rates as a matter of common concern.
Mr. Bruce Grocott: It really will not do for the Chancellor to say that the form of a debate is nothing whatsoever to do with him, and that it is a matter for the Leader of the House, when he has already announced that the debate will be on a motion for the Adjournment. Given his reputation for fluency, will he explain in simple language—not just for us, but for anyone who may be listening or viewing—exactly how a motion that this House do now adjourn relates to a decision on the Government's competence in the handling these matters?
Mr. Clarke: I am the bringer of news. I am not saying that it has nothing to do with me. I have the advantage of frequently being able to give my views to the Leader of the House, as does everyone else. It is the responsibility of the Leader of the House, in due course, to give the Government's decision on the timing and nature of the debate. I suppose that the hon. Gentleman makes a valid point against me, given that I have expressed surprise at the anxiety about this "take note" motion. A motion may not make anyone much wiser. Adjournment debates also have difficulties, but the House often debates matters of great importance on the Adjournment. It is a sensible way of allowing the House to express its views on a range of issues that will be raised at the Dublin summit, without binding negotiators hand and foot with a series of detailed resolutions before they ever get there. No other Head of Government goes to a European Council with a great list of instructions prepared in advance by Parliament, because that would weaken his negotiating position.
Mr. Barry Legg: My right hon. and learned Friend has expressed his respect for the House of Commons. He has also given us an insight into the profound nature of the regulations that we are considering. Some would say that the regulations are more profound and that their implications are deeper than anything that he may introduce in his Budget this week. In the light of that, will he confirm that scrutiny of the regulations will now take place by means of a full debate on the Floor of the House of Commons?
Mr. Clarke: I agree with my hon. Friend that the regulations are extremely detailed. As I said, on Friday
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I decided to give a precis of the enormous explanatory memorandum that I had already sent to the Committee. I could not do so in fewer than four pages, which are now circulating in the House. I agree that those matters deserve close scrutiny. We have begun that process in the Committee, and I am sure that my hon. Friend's views on how the House should handle the regulations will be taken on board. We cannot spend months on each and every particular. We must have a policy. We have a policy, which I adhere to strictly in all my activities at ECOFIN, and which I hope I have set out with some clarity in the statement and the answers that I have given today.
Mrs. Gwyneth Dunwoody: If the Chancellor of the Exchequer has such faith in the sovereignty of the House of Commons, will he tell us in simple terms why he is frightened of giving individual Members of Parliament the right to debate a matter that will affect our economic and political future for untold generations? The debate should not arise from an Adjournment motion—which the right hon. and learned Gentleman knows perfectly well the Government can ignore—but on a motion, the wording of which has been agreed and on which individual hon. Members can record their views.
Mr. Clarke: Nobody in the Government is frightened of a debate. We have said constantly that the debate must take place before the Dublin summit. Debates always take place before European summits. Nothing of a binding nature is ever agreed if it has not passed parliamentary scrutiny. The hon. Lady must await the statement by my right hon. Friend the Leader of the House about the form that the debate will take.
Mr. Ray Whitney: Does my right hon. and learned Friend share my concern that those who are hostile to the EMU convergence criteria, and who seem to believe that the definition of sovereignty may include a right perpetually to devalue the pound sterling, show a failure to understand the success of the British economy, which has been achieved under the Government?
Mr. Clarke: I agree. The idea that, in today's world, it is our sovereign right to keep devaluing and to run excessive deficits, and that we can do so without suffering tremendous economic punishment from the markets, is a myth. The convergence criteria conform to what any British Conservative regards as a sound approach to macro-economic policy. Unless and until we join EMU, I follow what I regard as the best economic policy for this country. It is chance that that happens to coincide with the Maastricht criteria. It is not wholly chance: the coincidence is partly because my right hon. Friend the Prime Minister and my right hon. Friend the Member for Kingston upon Thames (Mr. Lamont) played a part in negotiating those convergence criteria.
Mr. George Foulkes: As, in a burst of Freudian frankness, the Chancellor has admitted that he is not in control of the issue, and as the Prime Minister obviously is not either, will the Chancellor tell us who is?
Mr. Clarke: For the avoidance of doubt, let me say that I had not heard whatever caused the uproar when I replied.

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What I am charged with is the conduct of negotiations in ECOFIN, and I have set out with the greatest clarity—I hope—the way in which I pursue those. I have also made it clear that I am always ready to debate those matters in the House and to be scrutinised by the House, but the form of the debate must first follow our parliamentary procedures. It cannot be off the peg and purpose designed; it must be discussed in the usual way, and in due course will be announced by my right hon. Friend the Leader of the House.
Sir Timothy Sainsbury: Is it not clear that the right hon. Member for Dunfermline, East (Mr. Brown) is not very familiar with the use of parliamentary scrutiny reserves? Can my right hon. and learned Friend confirm that such reserves are frequently used in European Union affairs—not just by this country, but by other countries that have proper methods of parliamentary scrutiny—and that it is therefore not beyond the bounds of possibility that other member states might wish to enter parliamentary scrutiny reserves after ECOFIN?
Mr. Clarke: I have been attending European Councils for many years. Given his experience, my right hon. Friend will know as well as I do that they come up quite often, and that it is not at all unusual for a Minister to enter a parliamentary scrutiny reserve. It passes very quickly in the proceedings, because no one ever argues with it. It is understood by all the other Ministers, and is taken to mean that that Minister cannot commit his Government unless and until he has gone through the parliamentary process. I have encountered that over and over again; I have done it myself sometimes, and heard it done at other times. The Danes often do it, because they have particular parliamentary procedures. If anything, they tend to do it more often than we do, but all member states do it quite frequently.
Several hon. Members rose—
Madam Speaker: Order. I must call questions on this statement to a halt now, as we have another statement to come.

Household Projections
4.51 pm
The Secretary of State for the Environment (Mr. John Gummer): I am today publishing a Green Paper called "Household Growth: Where Shall We Live?" I am also publishing a summary version, which is available free. Copies of the documents are in both Libraries. A copy of the Green Paper is available from the Vote Office, and I am also sending a copy of the summary version to all hon. Members in England.
My Department has also published today an independent research report entitled "Urbanisation in England: Projections 1991–2016". It converts household projections into implied take-up of land for new housing and related urban uses, and shows the effect that that might have at county level. Copies of this document are also available in the Libraries.
There are few more important long-term issues facing this country than the likely growth in households over the next 20 years. The latest projections, published by my Department last year, indicate that there could be up to 4.4 million more households in England over a 25-year period running from 1991 to 2016. That is almost 1 million more than the figures for which we are currently planning. This raises significant issues, not only for us, but for our children and even our children's children.
How we provide for the new homes that will be needed is something for all of us—the whole community—to consider. Our success or failure in so doing will affect the quality of our lives, the appearance of our towns and countryside, our patterns of employment and transport, and so on: in short, the sort of country that we wish to hand on to succeeding generations. It will inevitably have implications not only for the housing and planning policies for which my Department is responsible, but for many policies across the whole of Government. This is not, however, a matter for Government alone.
The purpose of the Green Paper is to stimulate and contribute to a wide-ranging public debate—a debate on the alternative options open to us of how to respond to the challenge of accommodating the new homes we shall need. It is especially important in this case, because the Government do not and cannot pretend to have all the solutions; nor can they control or influence all the many and complex causes that contribute to household growth. Many of the causes are beyond the influence of any Government to alter fundamentally, if at all.
In its report last year on housing need, the Environment Select Committee—chaired by the hon. Member for Denton and Reddish (Mr. Bennett)—recommended that we explore the causes of household formation. The paper does that.
The growth in population explains part of the household growth, but it is not the only explanation. Indeed, for much of this century, growth in households has consistently outpaced the growth in population. There are three main reasons. First, improved living standards and better health mean that people are living longer, and often on their own. Secondly, people are better off than ever before, and can afford to set up separate households more easily. Thirdly, changes in social behaviour and attitudes, especially towards marriage and the family, lead to a smaller proportion of households consisting of married couples with children.

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Some of those changes are eminently desirable; others are harmful and damaging, and to be regretted. In all cases, however, the forces behind them are powerful. In many of these areas, other bodies are potentially more influential than Government. Churches, businesses, the entertainment industry, the arts, the media, schools—all exert influences in many of these fields which far outweigh any that Government can bring to bear. It is therefore absolutely right that we have a wide debate, involving the whole country, on whether anything can be done to influence the rate of household formation, so that it grows more slowly than it has in recent years.
That is right and proper, and, as I have said, reflects a recommendation from the Select Committee. However, it would be foolish for us to pretend that any of the trends can be easily reversed or modified. We must assume—it is only prudent to assume—that this growth will come about. Indeed, all the household projections produced by my Department over the last 10 years have consistently underestimated the actual household growth that has subsequently occurred.
As I have said, the amount of development for which we need to plan will have far-reaching consequences for the future shape, appearance and operation of our towns and countryside. At some point, all of us are likely to be touched by this issue—whether we live in a town or village that will need to expand, whether we have children growing up who will be seeking a first home of their own, or whether we live in the centre of the city which will need to accommodate new and different types of dwelling for the growing population that we foresee. That is why the debate must be for all of us. The Government want this to be a genuine debate. It will be a debate in which all the options for accommodating the growth will be open for discussion.
There is only one premise on which the debate should be based. My first priority is to use the growth in households to help to regenerate our existing towns and cities. For centuries, towns and cities have been the engines of civilisation, and, despite new ways of communicating, learning and doing business, they seem likely to remain so. It is therefore right and proper that we should seek to enhance them and their vitality by providing new homes within the existing urban fabric with facilities and services that are readily available.
With the right commitment to standards of environmental quality and the provision of homes, jobs and services, urban regeneration can offer a highly a sustainable option for future settlements. I therefore wish to see as much as possible of this new development going into our existing towns and cities, so that they can be revitalised and our countryside can be protected.
The production of this number of houses on green-field sites, concentrated in the most pressured areas, is simply not sustainable, and the Government are not prepared to plan to meet the pressures in that way. We have already set ourselves a target to build half all new housing on re-used land. I would be especially interested in people's views on whether we should set a target of 60 per cent.—indeed, whether even more might be possible. In saying that, I accept that we must strive to do everything possible to make all our towns more attractive places in which to live and work.
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Let no one delude himself that these issues can be avoided, or do not need to be addressed. Anyone in government would much prefer not to have to face what are very clear and real pressures; substantial growth, however, will happen, and will need to be accommodated.
But even accommodating more housing in our towns and cities, as we can and must, means that some development on green-field sites will still be needed. That is unavoidable. The question is, which is the most appropriate way in which to do it? The options include extending our existing towns and cities, as we did in Northampton, Peterborough, Swindon, Newbury and Thetford. That allows people to have access to a "ready-made" town or city, with all the facilities that that offers. In some areas, that may mean building on to small towns. That will be a sensitive issue. That is why we need to discuss with people whether that would be the best option for them and for their areas.
Other options could include new villages or even new towns. Again, whether that is an appropriate option will depend on local circumstances. I am not advocating new settlements, or ruling them out. I simply want to explore what is possible and what people want—[Interruption.] Labour Members should learn that we want the people with whom and in whose towns and villages other people will live to make the decisions themselves. I am interested in the outbreak of hilarity once one talks about consulting the people—an interesting attitude of the Labour party.
There is also the issue of expanding villages. We are already committed to ensuring that villages remain viable and that we meet local people's needs. Even if that option is taken up, however, it will not make a major contribution to the total. We must also be concerned about avoiding too much development in the countryside, and ensuring that new development is sustainable. Above all, whatever we choose, we must ensure that we create sustainable patterns of development, that we use the growth to regenerate our cities, and that we maintain our policy of urban containment.
The Government have already helped to put in place measures that will help to accommodate the necessary development, much of it in our urban areas. We have already set one target—50 per cent.—for the proportion of new housing to be built on previously used land, and, as I said earlier, I am now seeking people's views on a higher, aspirational target of 60 per cent. or even more. We have revised and updated our planning guidance to reflect the principles of sustainable development and changing patterns in the marketplace.
I have launched the quality initiative to ensure that the standard of all development is raised to the level of the best, so that new development enhances rather than detracts from its surroundings. We have produced our air quality strategy to cut pollution and to make our air cleaner. My right hon. Friend the Secretary of State for Transport has published his transport Green Paper, which deals with serious transport issues in our cities, and proposes measures for improvements.
We are encouraging the regeneration of our city centres through city challenge, more mixed-use development and revised planning policies. We have launched our "greening the city" initiative to make our towns more pleasant places in which to live. We are encouraging more conversions of houses and offices to flats, and greater flexibility in the use of standards where that is sensible and safe.

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None the less, other options will need to be explored as well, and that is what this debate will be about. In the next few months, my Department will organise a series of seminars in the regions to obtain local people's views on the impacts that household growth might have on their areas. My colleagues and I will be meeting different groups to assess their views. I hope that every hon. Member will contribute to the debate, and will encourage their constituents to do so. On the outcome of the debate depends the future of our towns and countryside and of the environment that we hand on to succeeding generations.
The only intolerable position in the debate is to hope that the problem will go away, and not face up to the real issues. I hope that all parties in the House can come together on the matter to seek an answer that will satisfy not only our generation, but succeeding ones.
Mr. Frank Dobson (Holborn and St. Pancras): Does the Secretary of State accept that his statement and document are long on pious concern, which sits uncomfortably with the fact that the Conservative Government, who have claimed for 17 years to be the party of rural England, have encouraged out-of-town development, whether it be housing, super-stores, warehousing or leisure centres? He commends the idea that local people should make decisions themselves, but was not much of that out-of-town development pushed through by Ministers, who overrode the decisions of local councils?
Does the Secretary of State accept that we welcome the recognition that something has gone wrong, but deplore the fact that he does not seem to have decided to do anything about it? Does he not realise that the problem of people leaving cities is not just a planning and housing matter? It is necessary to deal with the reasons why people leave cities—usually to seek a better quality of life.
Does the Secretary of State not accept that the years of failure by the Government to do anything about the problems of air pollution, rising crime, schools and hospital services in urban areas, other than to close those hospitals, have made things worse? Will he confirm that, last year, the Budget reduced the funds available for hospitals, schools and police in urban areas? What will happen in tomorrow's Budget? [Laughter.] It is no good the Secretary of State mouthing pieties today and allowing the Chancellor of the Exchequer to kick the bottom out of his pieties in the Budget tomorrow.
The Secretary of State will, I am sure, accept that we have long advocated more building on brown-field sites and more people coming back to live in flats above shops. Will he confirm that Tory central office arranged for Tory candidates to denounce us for advocating that? Does he not accept that there are limits on building in already built-up areas, that it costs more per house, that, with higher densities, maintenance costs are higher, and that problems can arise for householders if buildings have been erected on polluted land—for instance, on what were formerly landfill sites? Will he contemplate changes in the law to protect householders who acquire homes on brown-field sites?
Does the Secretary of State accept that not all open land in urban areas can be built on, that many green-field sites in urban areas are precious, and that more are needed to
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provide playing fields and sports grounds for existing town dwellers to keep up the quality of life, which may stop them moving out of the area? He says that not all sites are ripe for development, but does he accept that people are unlikely to accept his promises when 5,000 playing fields have been sold under the Government and 2,600 more are threatened with sell-off?
Does the Secretary of State recall that, on the "Today" programme this morning, he said that he would provide more money for urban areas when that is not true, and that tomorrow's Budget is likely to reduce the amount of money that goes to social housing? According to the Government's present plans, 1.8 million houses will be built on green-field sites. The Secretary of State aspires to just 40 per cent. of the new houses that are needed being built on green-field sites. That would mean that he aspires to building 1.5 million houses on green-field sites, concentrated particularly in the south-west, eastern and south-east regions. This is not the end of building in rural areas as we know it.
We welcome a debate, but the Secretary of State should remember the here and now. He wants to hit the target of a further 3.7 million houses by 2016, but is he not obliged to accept that he is building only 137,000 a year, at which rate, by 2016 we would be 1 million short of his announced target? Does not that expose his document for what it is—fine words, pious objectives and pious aspiration—but, when it comes to something practical, the Government are nowhere to be seen?
Mr. Gummer: I will stick to the here and now. I had hoped that we would be able to have a common view on this, but, as the hon. Gentleman decided that we are going to have a party political debate, I will remind him why Britain's cities have driven people out. It is because they have had Labour councils, which have made it more and more difficult for people to live in them. There has been greater crime in cities, because the Labour party has voted solidly against any measure against crime. It is soft on crime, and not hard on the criminal.
The Labour party says that we have done nothing about air pollution, but it has improved every year because of our policies, which are the most advanced in Europe. Within 10 years, we will have overtaken any country. Of course the Labour party does not know what happens in the rest of Europe, and clearly it does not know what happens in Britain, given that last series of questions.
The Labour party voted against everything that has raised education standards in schools. It was against league tables and any improvement in the school system. It was against city technical colleges and everything that has changed the face of education for the better in our cities. How the hon. Gentleman dares to make such party political points, I do not know. They might be all right for speeches in Camden, where the people have forgotten how much Camden borough council has contributed to the desolation of that area of London.
Since we are talking about contributions to cities, what about Lambeth's contribution to the improvement of life in the city? What about Islington, where the education is so bad that the Leader of the Opposition sends his child outside the borough? What happens in Southwark, where one of the Labour party Front-Bench spokespersons finds the education so bad that she sends her child outside the borough, but not even to a school in the state system?

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The Labour party has nothing to say on this matter. It is largely responsible for the condition of our cities; it has damaged the cities, while the Government have had to come to the rescue to change things.
Mr. Nick Raynsford (: Which party controls Greenwich council?
Mr. Gummer: The hon. Gentleman dares to ask from his seat who represents Greenwich. I shall tell him about the London borough of Greenwich that he dares to speak about. It has done nothing to attract people. All it has done is make it more and more difficult for people to live there comfortably and happily.
I shall now deal with one or two of the sensible suggestions made by the hon. Member for Holborn and St. Pancras. On open land, I have committed myself to protecting playing fields in the planning system throughout the country. I will tell the hon. Gentleman who my biggest enemies are in trying to do that—Labour councils, which have been trying to build on playing fields. One after another, they come forward with their schemes for building on playing fields and ask me, "Can we please build just here—not next door, just here, no more, but this one?" I can tell the hon. Gentleman that I turn them down.
I have been one of the foremost supporters of parks, through "Greening of the Cities", and so on. I am also pleased that, for the first time, large sums of money are going into the regeneration of our parks, not least from the lottery and the national heritage memorial fund. The hon. Member for Holborn and St. Pancras suggested that I am not building houses. Governments do not build houses; houses are built by the private sector and housing associations.
I turn to the question of money going into the city centres. Due to the capital challenge programme and environmental policies generally, we have brought in vast sums of money from the private sector that the Labour party could not begin to tap, and never wanted to. It pretends that such money does not go to city centres. The regeneration of the country will depend on partnership between Government, business, local government and voluntary organisations. That is what we are promoting.
We want a debate that goes far above and beyond the kind of petty comments that the hon. Member for Holborn and St. Pancras made up on the train from Nottingham. [Laughter.] He was going to make such comments no matter what I said in my statement. Even if I had mentioned figures of 70 or 80 per cent., he would have said the same. He should get on with the discussion, and leave the silly comments to the Liberal Democrats. They are the ones who have a different policy from one constituency to the next. He should leave them to lower the debate, and raise his sights.
Several hon. Members rose—
Mr. Deputy Speaker (Mr. Michael Morris): Order. Can we now have some short, sharp questions, and succinct answers?
Mr. Tim Yeo: Does my right hon. Friend agree that converting almost 7,000 hectares of rural land for urban use every year is unsustainable? In view of
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that, is he aware that there will be strong support for the idea of increasing the target for the percentage of new houses built on recycled land? Will he therefore consider supporting that target—not only through the planning system, by having a strong presumption in planning guidance against permission for development on a green-field site unless the developer can show that all the possibilities for development on brown-field sites have been exhausted, but possibly through the use of a market instrument such as a levy on any development on green-field sites?
Mr. Gummer: My hon. Friend will be pleased to see in the document that we have suggested that we might use the same kind of sequential judgment as that used for out-of-town shopping. We start by asking why the development cannot be built in the city centre, and, if it cannot, we ask whether there is a moderately close position. Only then can green-field sites be considered.
That is one of the propositions, and I hope that my hon. Friend will add his support to it if he feels that that is right. He is absolutely correct to say that it is unsustainable to believe that we can meet the requirements of the kind of life style that we have largely decided for ourselves merely by spreading houses across the countryside. That would not be right, either for our own generation or for future generations.
Mr. David Rendel: I was delighted to hear the hon. Member for South Suffolk (Mr. Yeo) support a green-field development tax, which sounds like a Liberal Democrat policy. Perhaps we shall see another Member crossing the Floor.
Although much of the Secretary of State's statement was, sadly, just a list of things on which he wants to consult, there was one very definite proposal that I—and I am sure my party—welcome: the move towards more of the housing requirement being put into urban areas than has previously been proposed. In making that proposal, he should answer one or two further questions. What, for example, is he going to do with the housing partnership fund? Will that continue to be funded? It has, of course, been one of the main ways in which empty housing has been brought back into use in urban areas up until now.
Despite saying that he wanted to encourage the conversion of houses and offices into flats, has the Secretary of State provided any incentives for doing so? Will he provide any in future? Will all this mean that the efforts to force housing on the shire counties through their structure plans will be changed? Will he give some further advice to the shire counties—those that have produced structure plans and those that are in the process of doing so—on how much housing should be in more urban areas as opposed to green-field sites?
Mr. Gummer: This is a continuation of policy. We used to get about 38 per cent. of new housing on brown-field sites. That figure is now nearer 50 per cent., and I want to increase it to 60 per cent. and beyond. We are talking about percentages. Does the hon. Gentleman not understand the difference between percentages and absolute figures? The policy has been going on for the past 15 years. As usual, he does not know his figures.
I want to answer the questions asked by the hon. Member for Newbury (Mr. Rendel), but I would be much happier to do so if I did not know what is going to happen.

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I shall tell him what will happen. Liberals in the country will say that the idea is very good, but Liberal Democrats in the towns will say that they do not want the houses. We know exactly what the Liberals will say; it is always like that.
I challenged a Liberal Democrat councillor in his own area on the issue when he tried to say that they wanted fewer houses. I said to him, "If you promise in your surgeries to tell every young couple who comes to you for a house that they cannot have one because you, the Liberal Democrat councillor, have stopped the building of houses, I will think about your proposal." Of course, he said, "Oh, no, I won't do that." What he meant was that he blamed the Government either way. That is Liberal policy, and we know that that is what it will be.
Of course I shall go on helping the policies to improve the use of empty homes, create more opportunities for conversion and ensure that people use their homes more effectively to let and the like. When he reads the document, the hon. Member for Newbury will find that most of those things are there covered.
Mr. David Howell: My right hon. Friend's proposal for a fresh debate is extremely welcome, although he will not get much help from the Labour party. Does he accept that there is widespread concern about the household projections and the way in which they are formulated, and that there is even more concern about the huge figures for housing plans that are proposed in various shire county structures, including Surrey?
Does he accept that such figures seem to assume and accommodate certain social trends, which we, as responsible Members of Parliament, may not wish to accommodate, and may want to alter in future? They seem to assume and accommodate large migration, particularly to the south and the south-east, of the kind that may not be in the interest of the north, the south or the nation.
Will my right hon. Friend consider that again before he is quite so definite about having to accept down to the last 100,000, or whatever, those enormous household projections? Will he very much endorse what he hinted at earlier—that, where planning authorities have brown land and want to build on it, they will be given powers to do so, so that the momentum of developers to go straight on to agricultural land is checked?
Mr. Gummer: My right hon. Friend and I have a similar attitude to the family and the concerns that he has raised. He will find in the document a very clear statement that, if we find such figures intolerable, we will have to look again at the way in which life style is operated and whether we are prepared to accept such an environmental result. That is a real issue. The problems are very clear.
Of course, the figures may be wrong, since, as I have said, we have always been wrong in recent years—but always due to underestimating. That is the problem. As a responsible Minister, I have to look at the sort of numbers that will be demanded. Even if we were able to change the mores of society, so that there were fewer divorces and so that divorced people married again, the numbers of homes that would be needed would still have a significant impact on the country. We will need to discuss the issues and decide whether the figures should be left exactly as
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they are; or whether, as I fear, they will be greater, or, as my hon. Friend and I hope, less. I hope that encouraging local authorities to use their planning powers will be one of the consensus views that will come from the document before us.
Mr. Andrew F. Bennett: I welcome the Secretary of State's commitment to a debate. One of the keys to the number of houses we will need to build in the future is how well we look after the existing housing stock. Is he satisfied that the Government are spending sufficient money modernising the existing stock? The Secretary of State hinted that he wants new building of high-rise flats and deck-access flats. If so, is he satisfied that local authorities and housing associations have sufficient resources to spend on the communal areas of existing flats to ensure that we do not lose them from the stock and therefore need more new dwellings built?
Mr. Gummer: I hope that the hon. Gentleman does not think that I am advocating the building of high-rise and deck-access flats. I mentioned mixed development and modern—and older—approaches to the subject, rather than the mistakes that we have made since the war. It is much better to have greater density than large areas of unused land. The density in many of our cities is measured not by the real density but by the fact that large areas of former factories and the like are not occupied. We must take seriously the change that has taken place and the need to reinforce our city centres.
I am happy to agree with the hon. Gentleman that we need to improve our housing stock. Most improvement in housing stock is done by the private sector—by people in their own homes—and the Government's successful economic policy is most likely to aid that improvement. Large-scale voluntary transfers will ensure that much of the older housing owned by local authorities is improved by releasing the money that is tied up in them. If certain local authorities, especially Labour authorities, had not held rents down or been unable to keep them up, we would have had very better quality. I hope that the hon. Gentleman will encourage people to take account of the benefits of large-scale voluntary transfers.
Dame Elaine Kellett-Bowman: Does my right hon. Friend accept that 50 per cent. in the inner cities is not enough, and that the figure should be nearer 70 per cent. to save our rural areas? Does he also accept that we should not join villages into mini-conurbations, as Lancashire county council seems determined to do to Garstang and Catterall?
Mr. Gummer: I understand my hon. Friend's cogent views. I also represent a rural constituency, so I understand the issues. I remind her that there are many ways to increase the number of people who can be accommodated in towns and cities without resorting to high-rise flats. For example, terraced houses with gardens can provide just as sensible an answer in terms of space as many of the high rises we have had in the past, as the Hulme redevelopment has shown. The answer is better, but sensible, housing for our urban areas.
Mrs. Anne Campbell: Will the Secretary of State clarify his current policy on small amounts of infilling in urban areas? Will he explain why his

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Department has recently written to Cambridge city council objecting to some aspects of its local plan, especially those that refer to small inbuilt developments, not on parks or playing fields, but on the sort of brown-field sites mentioned in the report today?
Mr. Gummer: I am sure that the hon. Lady would not expect me to go with her on a trip around Cambridge today, although I know the city well. The city council has a bad record for planning, and the city has been damaged by the refusal of the council to adopt a sensible transport policy. That is the city council that gave away green bicycles, found they were stolen and wondered why. That is the city council with some of the worst car-parking arrangements in the United Kingdom. Some of the car parks are looked after so badly that they have a smell that can be recognised down the street. So I would not be surprised if it got wrong the issue raised by the hon. Lady as well.
Mr. Geoffrey Clifton-Brown: Does my right hon. Friend agree that we would not need such a large number of houses if all the voids were utilised? Will he therefore carefully consider the nine out of 10 worst local authorities, which happen to be Labour, and ensure that they use their housing stock efficiently?
Mr. Gummer: Until the hon. Member for Holborn and St. Pancras (Mr. Dobson) asked his question, I had hoped that today we would proceed on the basis that much of the report was common ground, such as the suggestion that we should use all the accommodation we now have as efficiently as possible. That means that local councils, if they own houses, should seek large-scale voluntary transfers that would considerably improve the efficient use of the accommodation.
I hope that local councils that own accommodation will ensure that the changeover takes place quickly. I should like to see more private owners able to let accommodation in their homes. There are many actions that we can take; I agree with my hon. Friend that it is most important that we do not waste the accommodation we have, because that is environmentally unacceptable.
Mr. Neil Gerrard: The Secretary of State has said several times that his Department has underestimated the population projections for some years. Since those projections become the starting point for regional planning guidance for housing provision, is not the implication that the number of houses that need to be built has also been grossly underestimated? Even the Government accept that some houses will be built as social housing, mainly by housing associations, so can we expect that the Budget this week will provide more money to put right the backlog that the Secretary of State has just admitted?
Mr. Gummer: The hon. Gentleman is talking about two different sets of figures. We have clear figures on the need for housing for those in special need. Indeed, I am sure he will agree that the success of the housing action trust in his constituency has been remarkable. Although he was opposed to it to start with, I believe that he is now in favour of it, because it has been so successful. Much can be done, and is being done, in supported housing.
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We must get all hands to the pump, and one way to do that is for the hon. Member to encourage his local council to use the large-scale voluntary transfer mechanism, as is happening in many local councils, to ensure that we release large funds to improve housing and to reduce debt.
Sir Irvine Patnick: I welcome my right hon. Friend's Green Paper. He has not said much about green belts or about the tricks that local authorities such as Sheffield play when they try to bring land and sites out of the green belt into production. I trust that he will examine that aspect closely, because a huge tract of green belt land was prevented from going into development only by the action of one of his colleagues.
Mr. Gummer: I am glad that my hon. Friend agrees that my Department and one of my fellow Ministers stopped that happening, and Sheffield city council should not have sought to do it. I have committed myself again to being the strongest supporter of the green belt of any Secretary of State in recent times, and I shall continue to be that. The green belt is part of the protection of sustainable development. We cannot continue to destroy the areas that are especially important for the rest and relaxation of the people who live in cities. It is not acceptable.
Mr. George Foulkes: I shall try not to upset the Secretary of State, although he is awfully sensitive today. I do not know what has come over him. He said that he wants a national debate involving the whole country. He did not say anything about Scotland, yet the problems arise equally in Scotland. How much has the Scottish Office been involved so far in this issue, and will there be a parallel debate in that part of the United Kingdom?
Mr. Gummer: No one could be more enthusiastic than I about the United Kingdom and the desire of the whole of the United Kingdom to work together. The hon. Gentleman's support for a policy that would divide the United Kingdom and break it up does not give him much ground for what he has just said. I happen to be the Secretary of State for the Environment for England, so I am seeking to encourage discussion in the areas for which I am responsible and to which the figures refer.
It is proper for the Secretaries of State for Scotland, Wales and Northern Ireland to deal with those issues as they feel necessary. They have different problems with different pressures, which is one reason why we have a Secretary of State for each area.
Mr. Keith Mans: Does my right hon. Friend agree that, in determining how much accommodation we will need in the future, we should take into account not only extra households but the number of places in care homes for the elderly? Does he further agree that one way of ensuring that development takes place in urban areas and not on green-field sites is to encourage local authorities to write policies to ensure that into their local plans? If that were done, councils deciding on planning applications would have a good reason for refusing one for a green-field site, because the development would not be inside an urban area. In addition, writing such a policy into the plans would make it less likely that a decision to refuse an application would be overturned on appeal.
Mr. Gummer: I agree with my hon. Friend's last remarks, and we ought to look more carefully at the

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wisdom of always assuming that older people should live apart from their families. That is an area in which other European countries have a lot to teach us.
Mr. Paul Flynn: What priority has the Secretary of State given to the need to make the new homes energy-efficient? Will he examine the supreme qualities of new, modernised and galvanised steel frames and steel cladding? When he discovers their advantages in terms of durability and energy efficiency, will he promote their use—particularly the steel frames that are manufactured in Newport, Gwent?
Mr. Gummer: Energy efficiency is particularly important to the existing housing stock, as new houses will be built according to the tougher legislation that is now in place. The House will have noticed that the previous two Labour speakers—the first from Scotland and the second from Wales—would not have the status to question the English Secretary of State were Labour's policies on devolution to be followed.
Mr. Mark Robinson: My right hon. Friend's statement will be welcomed throughout Somerset, where there is great concern at the pressure that new houses may bring to the countryside. He has placed strong emphasis on brown-field sites. Will he make sure that counties with a shortage of brown-field sites, such as Somerset, are not told by their Liberal Democrat local authorities that, because of that shortage, they must build in the green countryside and villages, whose very character may be threatened?
Mr. Gummer: I agree, and the Liberal Democrats in Somerset wasted no time in saying that it would have to build on green-field sites. I suggest that the council should spend more time trying to find answers, as my hon. Friend suggests. The reason why the council made its announcement was straightforwardly party political. It wanted to frighten people, and to claim that the Government were threatening them. We heard that from the Liberal Democrats—as we always do.
Mr. Roy Thomason: I welcome my right hon. Friend's statement, and its particular emphasis on urban development. Will he confirm that he will not introduce a contaminated land regime, which would mitigate against his targets for urban development and his particular emphasis on brown-field sites?
In considering his green-field site policy, will he take account of the considerable concerns raised in areas around major conurbations where there is the possibility of the green belt being infringed? Does he agree that the green belt should be protected, and should not be allowed to be infringed by the development of transport connections arising from housing developments which spiral out from the conurbations and damage green belt areas?
Mr. Gummer: I shall certainly continue to protect the green belt areas. One of the problems with the phrase "contaminated land" is that it covers everything from land that is merely second-hand to land that has been deeply contaminated by a previous use, such as a gas station. It is
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a mistake to use those words in the generality, as we must clean up sites to the standard necessary for their purpose. In some cases—I hope, in more and more cases—that will be housing.
Mr. Peter Luff: I thank my right hon. Friend for his statement and for encouraging a debate on the subject. Does he understand that the people of Worcester will be alarmed by the new and higher figures for household formation rates that he has provided to the House?
First, can I urge my right hon. Friend to collaborate with his Government colleagues and with other organisations to find a way to create a downward impact on household formation rates, which I do not believe the House should accept as a given? Secondly, can I urge him to set a target of two thirds for the building of new houses in urban areas and brown-field sites? Thirdly, will he encourage the county councils which are setting arbitrary divisions in terms of the areas where development should go—I am thinking particularly of Worcestershire—to introduce policies that enable new housing developments to be spread evenly across county council areas and not concentrated in sensitive areas?
Mr. Gummer: First, my hon. Friend and I would disagree fundamentally about some of the reasons why we need more homes. It is sad that one in two marriages are now breaking up, as opposed to one in five. That is not something that the Government can easily reverse, but most of us ought to be concerned about the instability that it creates.
There are many reasons for the change in the figures, such as young people who are setting up home earlier, and older people who are living longer in their own homes. We must accept a number of things whether we like them or not, and it is as well to try to decide on how we will deal with them, while hoping that, by other actions—not only in this House, but by the Churches and outside organisations—we can do something about the sad destruction of the family, which is the centre of our society.
We must look more carefully at where county councils put houses, and how we target house building within our big cities and smaller towns. In addition, we must try to get some councils to stop using this subject as a party political weapon.
Mr. David Lidington: Does my right hon. Friend accept that responsible local authorities, such as Buckinghamshire, already feel that they are under enormous pressure from existing housing forecasts? Although I acknowledge that there are limits to the influence that the Government can have on the rate of housing formation, may I urge him to explore with his Cabinet colleagues whether there are other policy changes—for example, to the social security and tax system—that could help reinforce the family, and so mitigate the impact of the forecasts published today?
Mr. Gummer: My hon. Friend will find that these issues are raised in the consultative document, and he can be sure that my Cabinet colleagues and others will be considering these matters. This is a matter for a public debate and concerns difficult issues—not least the

57
questions of the family, family formation, the stability of the family and the way in which we intend to live. But we cannot start the discussion until we understand that, if we take on a particular life style, that has a direct environmental effect. If we do not want that effect, we must look at our life style, and it is no use pretending that the problem will go away. We must accept that this is a result of the way in which we have decided to live. If we do not want that result, we must live differently.
Mr. Michael Stern: I welcome the Green Paper's emphasis on local decisions on local housing matters. Does my right hon. Friend agree that it is important to encourage planning authorities not to take decisions in other areas that are inimical to housing development? I am thinking in particular of the decision that my right hon. Friend took—quite rightly—to bar an airport at Filton in my constituency, which would have stultified a considerable amount of housing development in an area where it is locally desired.
Mr. Gummer: We have to take such decisions, but so do local councils. If Bristol city council had followed a more progressive policy over Cribb's Causeway and its in-town development, it could have created a more lively centre for Bristol. However, the council has failed for years to rejuvenate its city centre.
Dr. Ian Twinn: Will my right hon. Friend accept my congratulations on grasping the problem of the gap between how people want to live and how people do not want others to live near them? Does he recognise that those of us who represent urban areas will be concerned by any increase in density in our areas? Does he accept that, in planning for an increase in households, there is a need to take into account that what may be a brown-field or under-used site to some hon. Members is a breathing space for those of us who live in urban areas? We do not want more and more town cramming—there must be a balance throughout the country.
Mr. Gummer: My hon. Friend must accept that we have tried to make sure that we have in place the policies to ensure that the greening and the improvement of our cities takes place, and cities must be prepared to look again at the way in which they develop. We must remember that about 80 per cent. of the units required will be for one-person families. Therefore, the nature of the housing and of the building, for example, the mixed development, will be different from the traditional family housing that we have discussed in the past.
Many of those people would prefer to live in the centre of the city because they want to be near all the amenities. If one is on one's own, it is more difficult to manage a suburban or a rural existence if one works in the centre of town. We are trying to put that sort of development together. We do not want to be caught in a situation in which all hon. Members representing the countryside say, "We can't have them here," and those who represent towns say that we cannot have them there either.
Somehow, the nation must make up its mind about how it will meet the demands, some of which are ineluctable. Some, we cannot solve without facing up to them. Others we could change, if we changed our pattern of life. I want a nation that is prepared to face up to the fact that, if it lives like that, that will be the result. If it does not want that result, it has to change the way it lives.

Points of Order
5.40 pm
Dame Elaine Kellett-Bowman: On a point of order, Madam Speaker. With the greatest respect, hon. Members get only 10 minutes every four weeks to question the Chairman of the Select Committee on Finance and Services. Today, regrettably, we had only three. I wanted to point out to him how much many hon. Members intensely dislike the renovation of the Tea Room—it is total chaos and a gross waste of taxpayers' money. Unfortunately, I shall not be able to raise that matter—well, I might, as you have allowed me to speak, but I will not receive a reply.
Madam Speaker: I do not call supplementary questions to fill the time available. I call a supplementary when I feel that the substantive question has not been fully explored. I believe that it was in that case. I called an Opposition Member and a Member from the Government side, and the Chairman of the Finance and Services Committee gave a full reply. I am sure that the hon. Lady will have an opportunity on some future occasion to underline what she has just said.
Mr. Norman Hogg: On a point of order, Madam Speaker. You will recall that you appointed the hon. Member for Staffordshire, Moorlands (Sir D. Knox) and myself to serve as joint Chairmen on the Standing Committee considering the Firearms (Amendment) Bill. Yesterday, the newspaper Scotland on Sunday carried an article about my role, and said:
"Norman Hogg 'Stormin' was last seen hiding behind a piece of arcane Commons protocol. Unfortunately the children of Dunblane had no such protection".
He
"claims that as Chair of the Committee dealing with the Bill it would be bad form for him to vote. Manners maketh the man, in this case not much of one."
As you will know, Madam Speaker, it is the practice of the Chairmen's Panel to take no part in the proceedings of a Bill on the Floor of the House after being advised of their appointment as Chairmen. It is a convention of the House, and it is designed to reinforce the impartiality of the Chair in applying our Standing Orders. Along with the hon. Member for Moorlands I sought to do exactly that.
I took time to explain to those Dunblane parents whom I met my function and responsibilities in the passage of the measure. I regret that the accredited journalists of Scotland on Sunday in this House did not explain the position to their editor—far from being arcane, it is well known. I should be grateful if you would confirm that I acted in accordance with practice, precedent and convention, and thus properly discharged my duties and responsibilities to the House.
Madam Speaker: I certainly confirm most strongly that the hon. Gentleman acted entirely properly in not voting on the Second Reading of the Firearms (Amendment) Bill. As he said, he acted in accordance with the rules of the Chairmen's Panel and the conventions of the House, which exist to create the conditions that allow Chairmen of Standing Committees to apply our Standing Orders property and impartially.

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I believe that he is deserving of a public apology from the editor concerned, and I hope that one will come his way before long.
Sir Donald Thompson: On a point of order, Madam Speaker. I have a constituent who is in some distress. He is 28 years old. He has written to every hon. Member. On Saturday morning, his mother brought a sheaf of letters to my advice surgery, which were remarkable in their kindness. May I thank the whole House, and those right hon. and hon. Members on both sides?
Madam Speaker: I can give no response to that point of order, but I am grateful to the hon. Members who acted in that way.

EMU (Documents)
5.46 pm
Mr. Nigel Spearing: I beg to ask leave to move the Adjournment of the House under Standing Order No. 20 for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the content and scope of documents concerning economic and monetary union to be discussed at the Economic and Finance Council of the European Community on 2 December."
The urgency is that scrutiny procedures have not been completed, although the meeting is to be held on Monday next. There is a clear possibility of political agreement being reached at that meeting, as we have heard. Indeed, the Leader of the House said in a letter that he expected a motion to be tabled today relating to the merits, under Standing Order 102(9).
As you know, Madam Speaker, that motion has not been tabled, nor has a date been given when it will be. Instead, the Chancellor of the Exchequer has promised an Adjournment debate some time after 2 December—it may be related to another meeting of the Heads of Government on 13 December. That debate will be on an Adjournment motion, however. There will be no immediate possibility of tabling an amendment and reaching a decision on it, unless the motion is linked with a motion tabled under Standing Order 102(9), on which such a decision could be reached.
Parliamentary procedure has effectively been circumvented, therefore, although within the Standing Orders. We need some form of focused debate before 2 December when that political decision can be taken. Despite the unanimous request of the Select Committee on European Legislation, backed by 150 Members of Parliament representing all points of view, we have failed to have that debate. I therefore hope that you will accept this motion, so that some debate can take place this week before those decisions are taken and a political agreement reached.
Madam Speaker: I have listened with care to the hon. Gentleman, and I have to give my decision without giving any reasons. I am afraid that I do not consider that the matter is appropriate for discussion under Standing Order No. 20, and I cannot submit the application to the House.

BILLS PRESENTED
  REPRESENTATION OF THE PEOPLE (AMENDMENT)
  Mr. Paul Flynn, supported by Mr. Tony Banks, Dr. Norman A. Godman, Mr. David Hanson, Mr. Nick Ainger, Mr. David Winnick, Mr. Andrew Mackinlay, Mr. George Foulkes and Ms Diane Abbott, presented a Bill to impose national spending limits on political parties at parliamentary general elections: And the same was read the First time; and ordered to be read a Second time upon Friday 17 January 1997 and to be printed [Bill 39].

  HUMAN TISSUE (AMENDMENT)
  Mr. John Marshall, supported by Mr. Jacques Arnold, Mr. Robert G. Hughes, Mr. Bob Dunn, Mr. Harry Greenway and Mr. Michael Alison, presented a Bill to require a person lawfully in possession of the body of a

  61
  deceased person to authorise the donation of the body or any specified part of the body for therapeutic or medical purposes if the deceased person had requested such a donation: And the same was read the First time; and ordered to be read a Second time upon Friday 7 February 1997 and to be printed [Bill 40].

  RESIDENTIAL HOMES
  Mr. David Congdon presented a Bill to prevent local authorities from being both a provider and a purchaser of residential care by requiring them to dispose of residential homes for the elderly and other homes to the private and voluntary sector; and for connected purposes: And the same was read the First time; and ordered to be read a Second time upon Friday 28 February 1997 and to be printed [Bill 41].
  PARKING PENALTY CHARGE
  Mr. Piers Merchant presented a Bill to amend section 66 and schedule 6 of the Road Traffic Act 1991 in order to add to the grounds on which representations may be made to a London authority concerning a Parking Penalty Charge Notice: And the same was read the First time; and ordered to be read a Second time upon Friday 14 February 1997 and to be printed [Bill 42].
  DELEGATED LEGISLATION
  Motion made, and Question put forthwith, pursuant to Standing Order No. 101(4) (Standing Committees on Delegated Legislation),

  SOCIAL SECURITY REGULATIONS
  That the Social Fund Cold Weather Payments (General) Amendment Regulations 1996 (S.I., 1996, No. 2544), the Social Security Benefit (Computation of Earnings) Regulations 1996 (S.I., 1996, No. 2745), the Social Security (Invalid Care Allowance) Amendment Regulations 1996 (S.I., 1996, No.2744), the Allocation of Housing Regulations 1996 (S.I., 1996, No. 2753), the Homelessness Regulations 1996 (S.I., 1996, No. 2754), and the Statement of Changes in Immigration Rules (HC 31) be referred to a Standing Committee on Delegated Legislation.—[Mr. Anthony Coombs.]
  Question agreed to.

Orders of the Day

  Social Security Administration (Fraud) Bill
  [Relevant documents: The Minutes of Evidence taken before the Social Security Committee on 26th June 1996 concerning Benefit Fraud (HC 528-i of Session 1995–96) and on 30th October 1996 concerning Child Benefit Fraud (HC 56-i of Session 1996–97.]
  Order for Second Reading read.
  5.47 pm
  The Secretary of State for Social Security (Mr. Peter Lilley): I beg to move, That the Bill be now read a Second time.
  Social security costs every working person in this country £15 every working day. Despite our continuing success in getting people back to work, there are still strong upward pressures on that burden as people, happily, live longer and we give more generous help to disabled people.
  If we are to meet our obligations to those in genuine need, which the Government are determined to do, we have to curb fraud and abuse. That has been my top priority since I began to reform the social security system. We have been developing the most comprehensive and effective programme of measures to combat social security fraud to be put in place anywhere in the world and it has been increasingly successful. Last year, about £1.4 billion of fraud was identified and stopped.
  As we have carried forward our strategy, we have found areas where our existing legal powers are inadequate. The Bill will give us the further powers that we need to tackle fraud even more effectively. There are three main areas where additional powers are needed.
  Mr. Dafydd Wigley: I want to raise a general point. Everyone recognises the need to limit and eradicate fraud, but does the Secretary of State accept that many people who should be beneficiaries of social security feel that they are being defrauded of their genuine entitlement? A report in yesterday's newspapers in Wales said that £206 million a year was being lost to those who are genuinely entitled. Will the right hon. Gentleman use the resources from savings on fraud to help those who need the money to claim it, and confirm that the Bill's long title allows that issue to be addressed at later stages?
  Mr. Lilley: I do not understand the hon. Gentleman's point about people being defrauded of benefit. If he means that people who are entitled to it are not claiming benefit, I can tell him that we endeavour to make information about people's rights and entitlements widely available, to help them to take up that benefit. I am sure that he does that in his constituency. It is unhelpful to confuse that problem with fraud and abuse.
  The first area in which we found that we needed extra powers was in galvanising and reinforcing the efforts of local authorities to tackle housing benefit fraud. Until a few years ago, most local authorities put little or no effort into tackling such fraud; the amount that they detected was pretty derisory.

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  In 1993, I introduced incentives and penalties to encourage local authorities to root out benefit fraud. I remind the House that when I did so, Opposition Front Benchers opposed us and the hon. Member for Manchester, Withington (Mr. Bradley) said:
  "The recovery targets … are unrealistically high."—[Official Report, 16 July 1993; Vol. 228, c. 1254.]
  In fact, the incentives and penalties persuaded local authorities to double savings in 1994–95 and to increase them further subsequently. Performance, however, remains too patchy and inadequate, and the study carried out jointly with local authorities shows that £1 billion of undetected fraud remains in addition to that which is detected and stopped.
  I therefore propose to establish a fraud inspectorate. The Bill will give it powers to examine the performance of local authorities and to inspect my Department's fraud operations. It will give me the power to direct a local authority to improve in a given time scale its performance in tackling fraud, and to penalise any authority in the—I hope—unlikely event that it fails to comply with my directions.
  Some local authorities are already responding positively to the challenge that I have given them, and the Bill will reinforce their ability to tackle fraud; it will give them powers of entry to local businesses, including landlords' business premises, similar to the powers that the Benefits Agency already has to enter and obtain documentary evidence useful in the detection of fraud.
  The Bill will give local authorities clear powers to exchange information with each other—for example, relating to possible cross-boundary housing benefit fraud—and with the Department of Social Security. I will be able to allow them direct access to my departmental databases. To ensure that the confidentiality of data is fully maintained, the Bill will extend to local authority staff the penalties for unauthorised disclosure of such information.
  I also intend to introduce proposals for new regulations under existing powers to suspend payment of benefit when there is reason to doubt the validity of a claim. That is extremely important, as it will enable local authorities to require a resident suspected of having moved away to prove that he still lives at the address for which he is claiming.
  The Bill will also improve local authorities' ability to recover overpayments to landlords. For example, if a landlord has been receiving housing benefit directly for a tenant long after the tenant has left his property, the local authority will be able to withhold cash from other direct housing benefit payments being made to the landlord, and that will not affect the tenure of other tenants in the property.
  Mr. Bernard Jenkin: Will my right hon. Friend clarify that point? One of the problems that confronted the Select Committee on Social Security during our inquiry into housing benefit fraud was that there seemed to be more of an obligation on housing authorities or the Department to pay housing benefit than to withhold it in cases of doubt. Is the onus now on the
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  claimant to prove the bona fides of his claim rather than on the local authority or the Department to prove that the claim is fraudulent before payment can be withheld?
  Mr. Lilley: Yes, we are responding to the problem in existing law. If a local authority, having granted a claim, subsequently had reason to suspect that it may be fraudulent, it did not have the power to demand further information; now, it will be given the power to suspend the claim and require the claimant to produce the relevant information before it is renewed. That will be particularly appropriate when, for example, we suspect that the claimant has moved away, but there are no powers of entry, the landlord obstructs entry or it is difficult to prove whether the tenant is still there; the Bill will require the tenant to prove that he is still there and needs continued payment before the claim can be renewed. That will be a powerful new ability.
  The Bill will enable authorities to stop postal redirection, making it far harder for individuals to establish claims in a number of different properties and have the benefit posted on to them. Those are all concrete, practical and powerful measures to reinforce action against fraud carried out by tenants and landlords—or, as is often the case, both in collusion.
  I read in the newspapers today that the Opposition propose three measures to stop housing benefit fraud. The first is to give
  "local authorities the power to refuse to pay directly to private landlords".
  They already have that power. The only circumstances in which they must pay the rent direct are if the tenant is eight weeks or more in arrears or if payments direct to a landlord for rent arrears are being made from the tenant's income support or jobseeker's allowance entitlement. I take it that Labour does not want to make evictions more likely by allowing arrears to build up even faster. That proposal therefore amounts to nothing.
  The second proposal is
  "the right to obtain proof from landlords about"
  their ownership of
  "properties for which they claim direct payment".
  Local authorities do not need such a power. They have a duty to satisfy themselves that a rent liability exists before they award benefit to the claimant.
  The third proposal is
  "the right to provide details of payments to landlords directly to the Inland Revenue to ensure that income tax is paid".
  The Inland Revenue can—and does when necessary—make that a duty, not a right, requiring local authorities to give it such information about direct payments to landlords. It neither wants nor needs additional powers in that sphere.
  In short, Labour's proposals are insubstantial; they would add nothing to local authorities' existing powers, and nothing to fraud savings. They are another bogus part of Labour's fraudulent attempt to conjure up savings from fraud to finance its £30 billion spending pledges.
  The second area where we have found our legal powers to be deficient is in the ability to cross-check data held by different Departments. Part of our anti-fraud strategy has been to cross-check information held on different databases in the DSS. For example, we hold information

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  about whether people are working on the national insurance record system and information about those claiming unemployment benefits on the income support computers. We have information about the children in households claiming income support and we will also have records about them on the child benefit computer.
  Although there was no legal obstacle to cross-checking those internal records, it used to be technically almost impossible to get different computers to speak to each other and compare data. We now have access to one of the most powerful data-matching tools to identify suspicious inconsistencies, and we have been using it to increasing effect. It is sensible to extend data-matching to relevant data held by other Government Departments.
  Mrs. Anne Campbell: What has the Department done about the European Union data directive, which appears to prohibit the use for unrelated purposes of data that have been collected for a specific purpose, and could make illegal the cross-checking to which the Secretary of State refers?
  Mr. Lilley: Common law prohibited us from using data collected for one purpose for another purpose unless there was statutory authority to do so or an overriding public good. The law hitherto has interpreted as overriding public good a specific suspicion that an individual may be committing a fraud. We can ask the Inland Revenue whether someone is paying income tax, discover some inconsistency and use it to bring a charge, but we cannot do a straight data-match by cross-checking two files. The Bill proposes to give us the statutory authority to do so. That power will conform with the European convention on human rights, the Data Protection Act 1988 and the law. The Bill will empower us to cross-check data with the Inland Revenue, Customs and Excise and other databases, notably on immigration, emigration, passports or prisoners.
  If we want to extend data-matching powers further, we shall have to lay an affirmative order before the House. I believe that the new powers will act as a strong measure to identify and stop fraud. They will also deter fraud by making people aware that they cannot tell inconsistent stories to public authorities.
  Earlier this month, the hon. Member for Fife, Central (Mr. McLeish) wrote to me suggesting that the Bill should be used to promote take-up of income-related benefits by pensioners—an issue raised in the past by the hon. Member for Birkenhead (Mr. Field). It is not clear exactly how the Opposition envisage that the cross-checking exercises used to identify fraud could also be used to promote take-up of income support among pensioners. [Interruption.] I tuned in to "Woman's Hour" the other day, as I do from time to time because it is a valuable programme, and I heard the hon. Member for Peckham (Ms Harman) explain that she intended to use the powers in the Bill to identify who was not receiving income support but appeared to be entitled to it.
  There are a number of problems with that proposal. First, such cross-checking would almost certainly be contrary to the European convention on human rights—at least according to legal advice that I have received—because it would be affected by the right to privacy, which restricts interference in a public authority unless the
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  Department is pursuing a crime or some similar offence. That may be an odd consequence of the European convention, but it has quite a lot of odd consequences.
  Mr. Frank Field: Being pro-European is also an odd position for the right hon. Gentleman.
  Mr. Lilley: It is not unusual for me to point out problems that arise from those international derogations of the sovereignty of the House.
  The practical problems with the Opposition's proposal are in any case overwhelming. Data from the Inland Revenue and other sources would certainly enable us to identify some people—but not all of them—who are not entitled to income support because they have sufficient income. If we were to contact everyone whom we did not positively know is not entitled to income support, it would require us to send out massive notifications inviting a massive number of people to make claims for income support. That would incur great cost, it would be badly targeted, it would offer poor value for money, and it would raise false expectations among many people that they might be entitled to benefit.
  Ms Harriet Harman: A million people.
  Mr. Lilley: No, many millions. Only a small proportion of pensioners are taxpayers, but many of them are not entitled to income support. We are talking about a multiple of those who are currently entitled but who are not claiming. They would receive notification from the Government that they should make a claim, but subsequently they would be disappointed and would probably take action against us as a result. The Opposition's proposal is a wholly impractical idea and outside the scope of the Bill.
  The third major area where there are inadequate powers, which we propose to address in the Bill, is our ability to review, prosecute and penalise fraudulent claims. I propose a programme of measures using some powers in the Bill and some existing powers to improve the situation. First, the majority of awards for disability living allowance are made for life. Existing legislation can be read to suggest that only a claimant may subsequently seek a review of his entitlement. That was not the intention of the legislation, but that is its effect. I propose to put beyond doubt the Department's ability to require a review of any suspect case. We already withhold benefit from people who make a claim but refuse to attend medical examination. I therefore propose similarly to withhold benefit from people who refuse to attend the medical examination needed to investigate doubt about an existing award.
  Secondly, as I mentioned in response to my hon. Friend the Member for Colchester, North (Mr. Jenkin), I intend to introduce proposals for new regulations under existing powers to suspend payment of housing benefit where there is reason to doubt the validity of the claim.
  Thirdly, the Bill will introduce for the first time in social security legislation an offence designed specifically to fit serious social security fraud with a penalty to match. Social security frauds are often long running. Typically, the fraud involves someone making a false statement to claim benefit and continuing to receive payments over a long period. Currently, those frauds are prosecuted on the

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  basis of a declaration made at the time of a payment. A long-running fraud, however, sometimes involves hundreds of fraudulently obtained payments, each of which needs to be charged as a separate offence. That makes the fraud unwieldy for the courts, which have ruled that a few specimen offences cannot be used to reflect the full scale of the fraud. Fraudulent payments made direct to bank or building society accounts do not even involve a specific declaration for each payment, and so cannot be prosecuted in that way.
  Under the Bill, we are creating a new offence of dishonestly making statements or failing to report a change of circumstance with a view to obtaining benefit. The offence will focus on the deception itself, taking account of the consequential payments. It is intended to catch the fraudster who continues to collect a succession of payments having made a false statement or having continually failed to report a change in circumstances. The court will be able to take account of all payments fraudulently received and a penalty of up to seven years in prison, or a fine—or both—will be available.
  Mr. Nigel Evans: When the measures that my right hon. Friend has described are enacted, they will save millions of pounds. For each pound saved, another pound will be available for those who really need it. When people are convicted of such crimes, will he ensure that such cases are given as much publicity as possible so that they deter others from going down that path of fraud?
  Mr. Lilley: I certainly want that. My Department already tries to ensure maximum publicity in local and regional newspapers for successful prosecutions. The Bill will provide us with material for press releases, which I believe act as a powerful deterrent—impossible though it is to measure that directly.
  Dr. Norman A. Godman: In the light of the penalties to which the right hon. Gentleman has just referred, does he anticipate such cases being heard in the sheriff court or the High Court in Scotland?
  Mr. Lilley: I am reliably informed that they would be heard in the High Court in Scotland.
  The fourth of the series of measures introduced in the Bill is that those who are required by regulations to report changes of circumstance but do not do so without reasonable excuse—that includes landlords who receive direct payments—will face up to three months' imprisonment. To do that, I am extending the existing provision about false representation to include failure to report a change of circumstances without reasonable excuse.
  Fifthly, I propose to require that anyone making a benefit claim should provide his national insurance number and evidence to show that he is the person to whom the number refers. Failing that, that person should
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  provide sufficient evidence to allow his national insurance number to be reliably traced or for a new national insurance number to be securely issued.
  Mr. Frank Field rose—
  Mr. Lilley: I shall certainly give way to the hon. Gentleman, who I anticipated might want to say something about national insurance.
  Mr. Field: Then I hope that the right hon. Gentleman has the answer ready.
  Given the Government's doubt about the security of the national insurance number system, what moves is the Secretary of State taking to assure the House that the scheme will become secure once again?
  Mr. Lilley: There is considerably less doubt about the system's security than has sometimes been suggested by those who loftily say that there are 20 million fraudulent numbers, when there are simply 20 million dead people whose numbers are tagged and whose information is kept as their widows or dependants may be entitled to benefit under the national insurance system. There is no chance of our failing to note a claim from a dead person because our suspicions would be aroused.
  The measures that we are taking to eliminate the remaining insecurities in the system have, I believe, been reported to the Select Committee. We have a thorough and comprehensive programme to try to ensure security from end to end of the pipeline and in the use of national insurance numbers. As a result of the measures, any false statement made to obtain a national insurance number will be an offence, which will help us to penalise those who are trying to break into the system.
  Mr. Field: I had not realised that what the Department had submitted to the Select Committee was an answer to that question. I understood from reading it that the Department was taking certain measures, which were welcome, but they do not add up to securing the national insurance number system. While I do not believe that all the numbers held on dead people are being fraudulently used, during the 1980s the Government gave many numbers to bogus asylum applications. What steps has the right hon. Gentleman taken to check not the claims of those whom we know to be dead, but the significant number of national insurance numbers, which is greater than one would expect, given the number of people in work and the number of people who have died?
  Mr. Lilley: I still disagree with the hon. Gentleman about whether there is a discrepancy between the number of numbers issued and the number that one would expect, given the number of those in work, retired or with other means of access to the system. As I recall, the main problem involving access to benefits and the false identities of asylum seekers was that benefits could be obtained using a letter, which did not require a national insurance number and which was issued by the Home Office without a photograph or fingerprint. We remedied that problem and required claimants to make their claim at a named post office and for a shorter duration than previously. As a result, we broadly eliminated that problem. I shall confirm to the hon. Gentleman in writing

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  whether that measure led to the issue of a large number of false national insurance numbers, but I do not think that it did.
  Mr. Field: The Secretary of State has explained that he stopped the fraud that was occurring. I have been asking what measures he has taken to check on the numbers that were issued before the processes, such as putting fingerprints on forms, that the right hon. Gentleman explained to the House were in place.
  Mr. Lilley: I am saying that we may have stopped a fraud that did not involve the multiplication of national insurance numbers. There is no evidence of a macro nature to show that a huge number is involved—it would have to be huge to show up in the discrepancy between the number of people we know to be at work and the numbers issued.
  People have undoubtedly been breaking the system. A far more serious problem than creating bogus numbers involves people hijacking existing numbers before the other person realises that claims have been made on his number while he has been happily in work and paying into the national insurance system. The evidence that we submitted to the Committee contained measures to stop that abuse.
  We have already increased to 20 per cent. the maximum deduction from current benefit that can be made to recover previous fraudulent overpayments, and that increase will form part of the programme. It is wrong that fraudsters should be treated in the same way as other people who owe us money. We shall therefore have the power to deduct up to 20 per cent. of their basic benefit while seeking repayment if they have a continuing entitlement to benefit. We shall also give priority to recovering money from fraudsters, backed up by civil proceedings where necessary.
  I intend to pilot a scheme of formal cautions. We can do that under our existing powers—we shall, for example, caution people who have committed a minor transgression for the first time and are prepared to admit it. Someone cautioned once will know that he is liable to be treated more severely the next time and he will have to pay back the money that he owes.
  Perhaps the most important of this series of measures is the one that will enable us to offer civil penalties as an alternative to court proceedings. Some people regard fraud as a comparatively low-risk option. Unless we prosecute, the worst that can happen is that the benefit that has been overpaid will be recovered. We shall continue to take the worst offenders to court and to demand more rapid repayment from others. The new offence that we have proposed will help us to pin penalties on the worst offenders. For intermediate cases, we shall offer the option of paying a settlement of 30 per cent. of the money owed on top of recovery of the money fraudulently taken and still not repaid. If people refuse, we shall send their papers for prosecution.
  Mr. Michael Stern: I should be grateful if my right hon. Friend could clear up a matter of confusion. According to the notes on clauses, the 30 per cent. penalty appears to be mitigable. I have read the clause and I cannot find a provision that allows for such mitigation. Are we talking about a mitigable penalty?
  Mr. Lilley: My hon. Friend has a greater knowledge of the jargon of the trade and I am sure that he will be
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  able to explore the matter fully in Committee if he is able to become a member of it. I suspect that my hon. Friend the Under-Secretary of State for Social Security, who is far better versed in such legal technicalities, will be able to reply later—and cover up my ignorance.
  I wish to remind the House about the Opposition's position on fraud.
  Mr. Frank Field: What does that have to do with the Bill?
  Mr. Lilley: It is extremely relevant to the Bill as we have a choice between the Government's proposals and the attitude adopted by the Opposition, who have opposed almost everything that I have done in this sphere.
  When I first made tackling fraud a priority, the Opposition even denied that it was important. The hon. Member for Withington said that there was a
  "danger of overstating the amount of fraud in the system."
  When I produced studies for the first time quantifying fraud, Labour's Front-Bench spokesman said that
  "even £1 billion is not a large amount."
  Where the Opposition were responsible for controlling fraud in the Labour-controlled local authorities, they demonstrated a complete lack of interest in tackling it. When I introduced rewards and penalties to galvanise Labour authorities to do something about fraud, the Labour party in Parliament condemned those measures and belittled the problem. The Labour Front-Bench spokesman said that
  "the recovery targets set for local authorities are unrealistically high".—[Official Report, 16 July 1993; Vol. 228, c. 1254–55.]
  But the targets subsequently led to a doubling of savings from fraud. When I announced plans for a benefit payment card, the right hon. Member for Glasgow, Garscadden (Mr. Dewar) attacked it as a waste of money. When I introduced a beat-a-cheat scheme, the Opposition immediately condemned it.
  The Opposition have opposed every major legislative measure to close loopholes. They attacked the habitual residence test designed to prevent benefit tourists from milking our benefits; they opposed penalties on new age travellers and others who refused even to apply for jobs; and they voted against measures to stop benefits for bogus asylum seekers. As the hon. Member for Sheffield, Brightside (Mr. Blunkett) rightly said:
  "Labour has been linked to freeloaders for too long".
  After denying that fraud was serious and after opposing measures to stop it, the Opposition are now getting into the business of fraud themselves. Their claims about the savings to be made from housing benefit fraud are fraudulent. The Labour party claims that it can conjure up £1 billion of extra fraud savings to finance its spending plans. The savings are a fraud, but the spending proposals are real, so it is the taxpayers who would pay.
  Mr. Alan Howarth: Will the right hon. Gentleman give way?
  Mr. Lilley: In a moment.

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  The Opposition base their claims on purely anecdotal evidence that the amount of fraud may be £1 billion higher than is suggested by Government figures.
  Mr. Henry McLeish: The evidence comes from the Select Committee.
  Mr. Lilley: I will give way if the hon. Gentleman would care to give the evidence on which the Select Committee allegedly based that claim. In fact, it did not make a claim but only remarked on it.
  Mr. McLeish: The point is that the Select Committee's evidence has been dismissed as an anecdote. If the Secretary of State is going to make a sweeping attack on a major Committee of the House, it is important that he gives the evidence that proves that the claim is truly bogus, to use his words.
  Mr. Lilley: I ask the hon. Gentleman to tell me what evidence the remark—
  Mr. McLeish: It was evidence in the Select Committee.
  Mr. Lilley: There was no evidence in the Select Committee, so I cannot dismiss it. Opposition Members base their case on a remark. The Committee interviewed a person from the London fraud officers group who, on subsequent inquiry from me, said that no survey had been carried out to back up his remark—unlike our survey, which was carried out with the help and co-operation of 56 local authorities and therefore has a scientific basis and should not lightly be dismissed.
  Mr. Alan Howarth: The Secretary of State accuses the Labour party of being less than rigorous in its assessment of expenditure and in its figures relating to fraud, but can he deny that he has accepted reductions in his budget as Secretary of State for Social Security on the assumption that he will be able to recoup those resources from expenditure savings arising from the successful pursuit of fraud? Is not that lacking in rigour? Is he not giving himself the benefit of a very large doubt and counting his chickens before they are hatched?
  Mr. Lilley: The hon. Gentleman is absolutely wrong. As I have reported to the House, I have secured increased resources to pursue fraud and those funds are ring-fenced. They will be devoted to tackling fraud and will secure considerable savings for the taxpayer.
  The Opposition claims that much extra fraud is being committed by landlords. The Labour party document, "Recovering the missing millions", claims that Labour could achieve £310 million net additional savings from its proposals to crack down on landlord fraud in the housing benefit survey. Yet our survey—confirmed by the very organisation on which many of the misrepresentations are based—suggests that landlord fraud amounts to between £150 million and £200 million. How can Labour possibly save an extra £310 million on top of the savings already made?
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  Opposition Members propose unworkable measures to reduce fraud. They say that they will carry out 4 million more visits to claimants and estimate that that would yield savings of more than £544 million. Yet the local authority methods that are cited assume home visits at a rate of 50 a day per visiting officer, which would imply a mere eight minutes between visits from end to end. It is absolutely nonsensical to suggest that officers could carry out serious investigations into fraud with only eight minutes between ringing one doorbell and ringing the next.
  Mr. Frank Field: Will the hon. Gentleman give way on that point?
  Mr. Lilley: I have given way to the hon. Gentleman three or four times already. I would have happily given way had he proposed to answer on behalf of the hon. Member for Fife, Central (Mr. McLeish) in respect of the evidence for the £2 billion figure that we know does not exist.
  Mr. Field: I shall happily answer on that point as well.
  Mr. Lilley: Then I shall give way.
  Mr. Field: It is interesting that, when people appearing before the Committee support a Government hunch or a Government prejudice, they are cited as giving evidence; but when they give us their estimate of fraud, the Government dismiss it. The Government should be more careful about such selectivity.
  Mr. Lilley: I have no vested interest in any particular estimate of housing benefit fraud. The only matter in which I have a vested interest is getting the figure as right as possible. That is why I carried out a scientific study. with the help of 56 local authorities, which investigated a representative sample of many hundreds of claims and produced a specific figure. That method is better than bar room suggestions that the real figure might be double the Government's suggested figure.
  The Labour party has also suggested that the mythical extra savings could be used to cover its spending programmes. In last week's rebuttal document, Labour claimed that five measures—jobseekers plus; the jobs, employment and training, or JET scheme; budgeting loans for the low paid; income support disregards for the wives of working men; and a higher disregard in jobseeker's allowance—will be financed from the savings in the benefit bill from combating fraud. Labour will not be able to achieve such savings and the proposed measures are pitiful, ineffective and based on unsubstantiated claims as to the amount. Labour's policies, as it now admits, imply extra spending of £136 million a year. Even The Guardian admitted:
  "There is no money left in anti-fraud measures, so Labour will have to stump up some cash here."
  By contrast with Labour's repeated and semi-fraudulent proposals, our policies are practical, effective and realistic. Our experience shows that our measures work and the Bill will reinforce our powers to make the battle against fraud more effective. It will boost the efforts of Labour and other local authorities, give us greater scope for data-matching across the range of financial information available to Government and improve the penalties available to penalise those who are identified as defrauding the system. I commend the Bill to the House.
  6.25 pm
  Ms Harriet Harman: No matter where fraud on the public purse is committed and no matter by whom it is committed, it must be stamped out. Taxpayers are already reeling from 22 Tory tax increases. They are paying more and more of their hard-earned money in Tory taxes, yet millions of precious pounds are being wasted on fraud. The welfare state must, at all times, remain vigilant in the battle against fraud. Fraud not only costs money and wastes resources, but saps public support for the social security system and the welfare state.
  The welfare state maintains its popular support because people want to be protected against the risks of unemployment, illness or disability. They value the knowledge that there will be support for them when they need it, but they do not want a welfare state that is exploited by fraudsters and hits their pocket through taxes. Every pound wasted on fraud wastes taxpayers' money, wastes money that could go to those in need, and wastes public support for the welfare state. It is for those three reasons that Labour is committed to cracking down on all fraud, whether by individuals or by organised fraudsters.
  Despite the Government's tough talk on fraud, we know that the Tories have failed on fraud. We know that because we can see their record. At this point, I want to say to the Secretary of State that he should be more cautious before belittling the work of the Select Committee on Social Security, because, were it not for its work in listening to the people on the ground who see the mounting fraud, I doubt that the House would be debating this Bill, proposed by this Secretary of State, today. We should have a bit more humility from the right hon. Gentleman.
  Mr. Lilley: Far from belittling the efforts of the Select Committee on Social Security, I bask in its praise, which has been fulsome. According to the Chairman, his original proposals were toned down somewhat because they were over-effusive in praising my efforts. I demand that Opposition Members cease to misrepresent a document that referred to a chance statement by one witness, as if it provided proof that there is £2 billion of housing benefit fraud, whereas the only established and available survey suggests that there is about £1 billion. I do not mind whether there is £1 billion or £2 billion—what I dislike is the suggestion that there is a mysterious £1 billion that can be conjured up, purloined and used to justify £1 billion of extra spending by the Labour party.
  Ms Harman: The Secretary of State says that he pays tribute to the work of the Select Committee on Social Security; it is a pity that he has not adopted its proposals for the full extent of powers that are needed to crack down on fraud. It is all very well to praise the Committee's work; the Bill falls short of the Committee's recommendations for action.
  Of course we use estimates when we speak about fraud—people who commit fraud do not declare it—but the Select Committee said on page vi, paragraph 6 of its 1995–96 report on housing benefit fraud:
  "It is possible that the true total is £2 billion, perhaps even greater".
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  The Government were warned year after year about the increasing scale of the problem, but they failed to take tough action, especially on organised landlord fraud. They failed to do so because—
  Mr. Bernard Jenkin: The hon. Lady quoted from the Select Committee report; I am a member of that Select Committee. She read out the passage starting, "It is possible". I was happy to put that £2 billion in to highlight the anxiety of some of our witnesses, but I am convinced that the Government survey data are by far the most accurate record that we can lay our hands on of the true amount of fraud. What does she believe that the fraud figure is?
  Ms Harman: The hon. Gentleman has sought to back off from a statement in a report to which he put his name:
  "It is possible that the true total is £2 billion".
  However, bearing in mind the fact that we agree that, over the years, billions of pounds have been wasted through being defrauded from the public purse, perhaps the House should move on to consider the actions that should be taken to solve the problem.
  It is my contention that the Government have failed to take action because they are complacent about the undermining of support for the welfare state, they are not vigilant on behalf of the welfare state and they are soft on private landlord cheats. Their dogmatic view that everything in the private sector is good whereas everything in the public sector must be bad means that they have shrunk away from acting against private landlord cheats who rip off the system.
  The Social Security Committee estimated that as much as £1 of every £5 spent on housing benefit is wasted on fraud. The Local Authority Investigation Officers Group, to which I pay tribute for its work in drawing attention to the scale of fraud and its proposals for tackling it, told the Select Committee that housing benefit fraud could be even greater.
  The Association of London Government estimates that at least £40 million is wasted on housing benefit fraud in London alone, and that much of that fraud is committed by landlords cheating the system, alone or in collusion with tenants.
  A case highlighted in evidence to the Select Committee was that of a landlord in London to whom 165 housing benefit claims were paid directly. When the claims were checked, it was discovered that 56 of the claimants did not exist—phantom tenancies. The landlord was ripping off the taxpayer to the tune of no less than £5,000 a week. He was caught, but no doubt many landlords committing similar frauds are as yet undetected. In another case, when the properties of eight managing agents in Greenwich were investigated, 88 of 292 properties were found to be empty.
  That is why we need the visiting officers knocking on the door. It does not take long to discover that premises do not exist or are deserted. It is a scandal that landlord cheats have ripped off the taxpayer and that the Government have failed to take action until now, when—after 17 years of Tory government—they are introducing the Bill five months before the general election.
  Housing benefit fraud is serious because spending on housing benefit accounts for a large part of the social security budget. Under the Secretary of State for Social

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  Security and his Tory predecessors, there has been a huge increase in the amount spent on housing benefit. The housing benefit budget has soared since 1979, when it was £2.2 billion, to about £11.2 billion a year. Spending on
  housing benefit has increased dramatically because of the huge increases in housing benefit paid to claimants in the private sector. As an increasing number of people have claimed housing benefit and the cost to the taxpayer has soared, fraud has grown.
  The Bill seeks to punish those who make false claims on taxpayers' money. We could not agree more; but among the biggest false claims being made today are those of the Conservatives that they are tough on fraud. I shall set out our view of their record, chronologically and based on fact.
  In the early 1980s, local authorities took action. They
  began appointing fraud inspectors to tackle what they believed to be the problem of housing benefit fraud. Did the Government listen to their anxieties or back up their action? No, they did not—and that was the early 1980s. In 1992, the London Boroughs Fraud Investigators Group
  urged the Government to set up a London-wide body to tackle the serious problem of organised landlord fraud. It asked the Department of Social Security for help. In the
  report that it sent to the Department as long ago as 1992, it said:
  "Organised Housing Benefit fraud is a large, financially significant problem. It is more lucrative than Income Support fraud. Its perpetrators are mostly landlords or managing agents. The DSS does not investigate organised Housing Benefit fraud … we have a serious problem that the London Local Authorities need to tackle."
  It also proposed—in 1992—
  "a specialist team investigating organised Housing Benefit fraud is what is needed."
  Did the Government listen or take action? No, they did not.
  It was not until May 1996, four years and many billions of pounds later, that the Government set up a pilot project. In fact, much of the action that the Tories have taken in the past 17 years has hindered rather than helped the fight against fraud. They cut visits to check on fraud from 6.6 million a year under the last Labour Government to only 500,000 a year. They penalised local authorities that took action on fraud. Not only were those local authorities obliged to pay, without subsidy, for fraud investigating officers, but when those officers detected fraud, they were subject to a financial penalty from the DSS. The Tories penalised local authorities that took action on fraud in the public interest until, finally, they were pushed to change the rules in 1993.
  The Tories have been complacent about the problem of
  organised landlord fraud. Not until May 1996, when the Social Security Committee once again brought the
  problem to their attention, did they prepare the Bill. While fat cat landlords have lined their pockets with taxpayers' hard-earned money, the Secretary of State has stood idly by year after year, until now. That is the background against which the Bill is introduced.
  We support the proposal in the Bill to cross-match central and local government data to tackle fraud. We support it—indeed, we proposed it in our document, "Recovering the missing millions".
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  We support the proposal to require the Post Office to disclose or prevent the redirection of post, to tackle fraud. We support that measure—indeed, we proposed it.
  Mr. Bernard Jenkin: Will the hon. Lady give way?
  Ms Harman: In due course.
  We support the proposal to create a fraud inspectorate—indeed, we proposed it. We supported it in "Recovering the missing millions", our policy document published this year. We supported it before the Bill was drafted. We are simply letting the Government know that we support their adoption of those proposals, which are widely supported by the Social Security Committee and the Audit Commission. We support tough penalties for those who make false claims to defraud the public purse. Innocent claimants should have nothing to fear, while guilty fraudsters will be rooted out.
  Mr. Jenkin: Will the hon. Lady give way?
  Ms Harman: I shall give way to the hon. Gentleman again, although I fear that it might be a mistake.
  Mr. Jenkin: I suffer the hon. Lady's rebuke with due humility, but I am extremely grateful to her for giving way. She admonished the Secretary of State for following in the wake of the Select Committee on Social Security. Will she be honest enough to admit that she has taken many of her policy initiatives from that Committee? They did not go from her to the hon. Member for Birkenhead (Mr. Field); I rather fancy that they went in the opposite direction.
  Ms Harman: The hon. Gentleman has it completely wrong; I admonished the Secretary of State not for failing to adopt the Select Committee's recommendations but for sneering at its recommendations and the evidence that it placed before the House, and for failing fully to take on board the sensible recommendations that it made.
  The Bill must do more. In Committee, we shall press the Government to take far tougher measures to deal with organised landlord fraud. There should be a new offence to deal with landlords who make multiple false claims to rip off the taxpayer. Despite the massive scale of the problem that has emerged in recent years, no such offence exists and those who prosecute on that issue must go between the Theft Act 1978, false accounting and other bits of legislation in order to found their case. There should be a specific new offence to deal not with those who simply fail to notify or who make an individual claim, but with organised landlord fraudsters.
  We must do even more. We propose giving local authorities the power to refuse to pay direct to private landlords in all but exceptional circumstances. The Select Committee and the Audit Commission recommended that action, but it is not in the Bill. The Secretary of State, who is not responsible for prosecuting in that area, says that local authorities already have that power, but the Select Committee, the Audit Commission and those investigating and prosecuting fraud say that they do not. We propose that the power should be specifically in the Bill.
  We propose giving local authorities the right to obtain proof from landlords about properties for which they claim direct payment of housing benefit. The Select

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  Committee and the Audit Commission recommended that action, but it is not in the Bill. We propose giving local authorities the power to require landlords to give notification of other properties for which they receive direct payments of housing benefit. The Select Committee and the Audit Commission recommended that tough action, but it is not in the Bill.
  We also propose that local authorities automatically provide details of payments that they make to landlords directly to the Inland Revenue, to ensure that landlords pay income tax. Again, the Select Committee and the Audit Commission recommended that tough action, but where is it? It is not in the Bill.
  The Secretary of State has, in the past—I concede that he did so less today—tried to draw attention away from the Government's failure to take action on fraud by blaming Labour-controlled local authorities. He has failed to tackle fraud, so he makes local councils his scapegoat. Neither the Social Security Committee nor the Audit Commission shares his assertion that Labour-controlled councils are soft on fraud. If that is the Secretary of State's view, he will never solve the problem of fraud, but will simply continue to play party political games while the public purse is defrauded. The Select Committee and the Audit Commission say that it is not the party in power in local government but the system that has been deficient.
  What this country needs now is a partnership between local government and national Government, to work together genuinely to tackle fraud. I hope that that is the spirit in which the Government will approach the Bill in Committee.
  Mr. Nigel Evans: The hon. Lady talks about playing politics with this issue. Is not the Labour party trying to play politics with social security fraud? By the action that they have taken since 1992, the Government have tripled the savings from more than £500 million to nearly £1.5 billion. The hon. Lady tries to argue that the savings from fraud can be much greater, so that the Labour party can go into the next election pretending that some of its extensive spending plans can be met from money saved on fraud, instead of from putting up taxes, which is exactly what it will do.
  Ms Harman: It ill behoves a member of the party whose Government have promised to cut taxes and who have put up taxes 22 times to accuse us of planning to put up taxes. My case is that evidence of fraud emerged at local level. Councils responsible for administering the housing benefit system identified the problem and were concerned about it. They told the Department of Social Security about the problem and were told, "There is no problem." They went to the Social Security Committee, had a keen hearing and presented these proposals. That is the true story.
  Mr. Lilley: The hon. Lady was not a Front-Bench spokesman on fraud at the time, but when we made proposals to encourage local authorities to take much more aggressive action to cut down on fraud, her predecessors told us that we were in danger of exaggerating the amount of fraud, that £1 billion was a small sum, that the measures that we were taking were excessive and onerous, and that local authorities could not meet them.
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  Had we accepted that advice, we would have left the problem untackled. Happily, we ignored it and we have succeeded in provoking and galvanising local authorities into more than doubling their fraud savings in a single year, and subsequently increasing them significantly. They will do so more as a result of the measures that we are introducing today. We have ignored the Labour party's continual refusal to take the fraud issue seriously.
  Ms Harman: The Secretary of State says that he has provoked and galvanised local authorities into action to tackle fraud. It is quite the other way round: local authority investigators have provoked and galvanised the Government to take action on fraud.
  As well as helping to catch benefit fraudsters, the proposals in the Bill to cross-match Government data provide the House with an opportunity to help some of the poorest people in Britain: pensioners. Government figures published last week show that there has been a dramatic increase in the number of very poor pensioners—those entitled to income support but who do not claim it. The figure has risen from 700,000 to 955,000. Nearly 1 million pensioners now lose out on money that they desperately need. Government figures show that they lose an average of £14 a week—more than £700 a year—which is equivalent to almost 25 per cent. of the basic state pension.
  I freely admit that I was on "Woman's Hour" because 800,000 of those pensioners are women who live on their own and have no state earnings-related pension scheme, no occupational pension, no savings, no nothing. It is a scandal that pensioners who spent a lifetime at work or caring for their family are among the poorest people in Britain today. It is particularly worrying as winter approaches and pensioners throughout the country must choose between heating and eating. The problem is urgent and is made worse by the Government imposing VAT on gas and electricity.
  Why are 1 million pensioners—among the poorest people in Britain—failing to claim the £700 a year in income support to which they are entitled? The Secretary of State has a simple answer. He says that they do not claim it because they do not want or need it. They make the choice, and decide that they do not want the £700.
  We wrote to ask the Secretary of State whether the cross-matching of data under the Bill could be used not only to tackle fraud, but to help to get the income entitlement to the poorest pensioners. We asked him to include such a measure in the Bill. He rejected our proposal and stated in a letter of 22 November:
  "In considering the question of take-up of benefits, I think it is necessary to remember that the claiming of benefit is, of course, a matter of personal choice and there will always be those who choose not to make a claim."
  Are 1 million pensioners choosing not to make a claim—not to have that £700? It is unacceptable for the Secretary of State to adopt that attitude.
  The truth is different. The message to pensioners from the Government has been clear: "If you claim benefits, you are a scrounger; if you are a pensioner, you are a burden." So 1 million pensioners do not claim their entitlement. We know that pensioners feel the stigma of means testing most sharply of all.

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  Despite the European convention, the Bill uses the cross-matching of Government-held data to catch benefit fraud. Why cannot the Bill use the cross-matching of data to give the poorest people their entitlement?
  The Minister for Social Security and Disabled People (Mr. Alistair Burt): Before the hon. Lady leaves the topic of poorer pensioners, will she explain how her proposal for a pension to be drawn at the age of 60 at some £20 a week less for life will help in dealing with poorer pensioners?
  Ms Harman: Is the Minister referring to our proposals for a flexible decade of retirement?
  Mr. Burt indicated assent.
  Ms Harman: With your leave, Mr. Deputy Speaker, I will digress to comment on the flexible decade of retirement, but I will return to the cross-matching of Government and local authority data to get help to the 1 million poorest pensioners. That was a valiant attempt by the Minister, but I fear that it will be an own goal, not a diversionary tactic.
  People are retiring at different ages. The pattern of employment is changing and people are retiring across a decade. There used to be a fixed pattern of work—men would leave school, get a job, work full time for their entire working life, retire at 65 and get their state pension. Many people now have occupational pension schemes, which enable them to retire earlier. We argue that there should not be a one-size-fits-all welfare state. Flexibility in the state pension system could help people to exercise more choice in their lives. If that can be done at no cost to the public purse, why not do it?
  We have said that those who draw their pension five years earlier than the pivotal date will draw it at a lower rate, but if they have occupational pensions, savings or other income to ensure that they do not fall back on the state at a later date, why should they not make that choice? Hon. Members on the Government Benches are making a mistake by setting their face against greater flexibility in the social security system to meet the changing patterns of people's lives.
  The Government have proposed data matching to deal with fraud. Why do they refuse to accept data matching for benefit take-up? The Secretary of State for Social Security hid behind Europe's skirts. He failed to say whether he thought that it was a good idea; he merely said that Europe would not wear it. I make two points in response to that.
  First, what is the Secretary of State's view? Does he think that that is a good idea and worth doing? Secondly, it is clear that article 8 of the European convention on human rights does not stand in the way of the cross-matching of data. Just as article 8 allows an exemption under the law for the purposes of national security and public safety, it allows exceptions by law for other purposes. I do not believe that the matching of information held by the Government for the purpose of getting income to the poorest people would be found to be in breach of the European convention on human rights.
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  I say that with a great deal of experience of litigating in front of the European Court of Human Rights on the convention. I know how the court works. The notion that our proposal would fall foul of the European convention is absurd and cowardly. The Government will not say simply that they do not want to pay those people their money, so they will not help them get it.
  The Parliamentary Under—Secretary of State for Social Security (Mr. Oliver Heald): It is clear from article 8(2) that the prevention of disorder or crime, which is the category into which benefit fraud would fall, is one of the exceptions. Which exception is the hon. Lady relying on for her scheme?
  Ms Harman: Various exemptions are relevant: the protection of health, or the protection of the rights and freedoms of others. The Minister makes a bogus assertion. The Government are lurking behind the European convention and legal advice, while 1 million pensioners suffer extreme poverty and hardship. I hope that the Government will think again and support our proposals to help us to deliver their entitlement to 1 million pensioners who have given Britain so much for so long.
  This week the Secretary of State has been engaged in pre-Budget briefings.
  Mr. Lilley: Not so.
  Ms Harman: I am glad to give the Secretary of State the opportunity to deny the reports about him in The Guardian, which states that he will help the Chancellor to pay for tax cuts by cutting £1 billion in fraud from the benefits bill. The article continues: "Mr. Lilley is confident". I give him the opportunity to say at the Dispatch Box that he is not confident and that he is not going to save £1 billion.
  Mr. Lilley: Last year I saved £1.5 billion. I deplore The Guardian, whose article I have not read and with whose reporter I have not spoken, if it suggests that we shall save less in future.
  Ms Harman: The assertion in The Guardian, which has been denied, is that in addition to the £1.8 billion that it is claimed will be saved, an extra £1 billion—a third as much again—will be saved this year. However, the Secretary of State has denied it. He does not think that he can save £1 billion by cutting housing benefit fraud to help the Chancellor with his tax cuts. I am glad that those were not proud boasts behind closed doors—the Secretary of State said nothing of the sort.
  It is clear that the Government will not save an extra £1 billion on housing benefit fraud, because they refuse to take the tough measures required to crack down on organised landlord cheats. Despite the Bill's shortcomings, we shall work in Committee to toughen the measures in it in order to end the scandal of a multi-billion pound fraud by private landlords—a fraud on the taxpayers and on the welfare state.
  6.59 pm
  Mr. David Faber: Thank you, Mr. Deputy Speaker. I am grateful to be called to speak so early in the debate. I listened carefully to the speech by the hon.

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  Member for Peckham (Ms Harman). I have had the same dubious pleasure during health debates in the past year and the record seems to have got stuck. She and the hon. Member for Fife, Central (Mr. McLeish) continually pray in aid the work of the Social Security Committee, which is ironic at best and disgraceful at worst. I have served on the Committee for four years and have been instrumental in helping to compile reports on benefit fraud. I have done so because I feel strongly about that issue and out of respect for the Committee Chairman, the hon. Member for Birkenhead (Mr. Field), to whose work I pay tribute. It is outrageous for the hon. Lady to twist the Committee's findings, to quote it selectively and to pay no heed to its many conclusions that form part of the legislation.
  The hon. Lady accused my right hon. Friend of belittling the Committee's work. I have listened to my right hon. Friend giving evidence before the Committee for many hours and I am thankful that the hon. Lady will never have the opportunity to appear before us in that capacity. The truth is that the Committee set up its inquiry in spite of the Labour party, not because of it. I am sorry to embarrass the hon. Member for Birkenhead again, but I refer to his remarks during the Committee on 7 February this year when he said:
  "when we announced as a Committee that we were doing an inquiry into benefit fraud, one of my colleagues sidled up and said, 'Typical! Another right-wing strategy from you.' It never struck me that being against fraud was actually a right-wing stance."
  That is the Labour party's view on benefit fraud.
  We last debated the issue in March this year on a Government motion and I am delighted that we have the opportunity to discuss it again today in the context of this legislation which takes us further forward. The Committee has continued its investigations and has moved from housing benefit fraud to child benefit fraud. The Government have taken many welcome steps since the last debate. I welcome particularly the on-going benefit reviews which gauge the extent of benefit fraud. Income support and unemployment benefit fraud were tackled first, followed by retirement pensions, housing benefit and invalid carers allowance. I am sure that it is only a matter of time before the review moves on to child benefit fraud.
  Since the debate, the Government have moved forward in two key areas. The contract was announced for the introduction of a payment card and I ask my hon. Friend the Member for North Hertfordshire (Mr. Heald) to allay in his winding-up speech several concerns expressed about that card. It was suggested in the newspapers recently that the chip in some cards could be tampered with, affecting their security. I seek his assurance that such technology will not be used in the payment card.
  The Department of Social Security memo to the Committee says that the card will "virtually eliminate" all instrument of payment fraud. However, we remain somewhat concerned that, if the card is fraudulently obtained initially, that may legitimise other types of fraud. I seek my hon. Friend's assurance that there will be strict verification and reverification procedures upon the issuing of cards. Nevertheless, potential savings of £150 million per year for a £200 million investment are welcomed warmly.
  The Government's other obvious advance in recent weeks and months is our extension of the free benefit fraud hotline nationwide. That is a very worthwhile and welcome move. The hotline has been successful at a local level—
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  during the March debate we heard that pilot project savings were running at about £800,000 per £20,000 of expenditure. We now know that the national hotline has also proved a success and I understand that it has received 105,000 calls to date, running at 5,000 per week. I am interested to know whether the cost-benefit analysis still applies in terms of comparing the cost of running the hotline with the fraudulent benefit savings made.
  Earlier this month, my hon. Friend unveiled the world's biggest social security data-checking operation in Manchester. Local authorities and Post Office employees have better incentives to tackle fraud, identity checks have improved and the number of home visits has greatly increased. Most welcome of all is the establishment of a joint project by the Benefits Agency and the Contributions Agency to crack down on national insurance number fraud. I hope that my right hon. Friend and my hon. Friend will examine carefully the Committee's concerns and recommendations as articulated earlier by the hon. Member for Birkenhead.
  As we have heard already in the debate, fraudulent benefit savings have increased from £717 million in 1994–95 to £1.44 billion in 1995–96 and they are expected to rise again to £1.8 billion in 1996–97. I echo the remarks of my hon. Friend the Member for Colchester, North (Mr. Jenkin) in his intervention on the hon. Member for Peckham: she should not read too much into the information provided by the fraud investigators group. It has done some excellent work—a member is one of our specialist advisers and he knows a great deal about the issue—but it has provided no hard evidence to contradict the Government's figures about the extent of social security fraud. The on-going process of benefit reviews is providing more hard and fast data every week and every month.
  Clauses 1 to 4 deal with the supply of information to those who are fighting the battle against fraud. In the Select Committee's third report, we specifically recommend that the Government should investigate whether serious social security fraud could be added to the list of categories where confidential information from Inland Revenue may be passed to the DSS. I welcome especially the Bill's proposals to allow the DSS to cross-check data with that held by the Inland Revenue and by Customs and Excise. That will make it easier for DSS agencies to investigate benefit fraud, but it is important that the flow of information be maintained to local authorities as well.
  I refer my right hon. Friend to clause 1. Will local authorities be deemed to be a body
  "supplied to, or … a person providing services to, the Secretary of State"?
  If that clause applies to local authorities, there will be some problems passing information from the DSS to the local authorities who need it.
  Mr. Heald: Perhaps I can assist my hon. Friend. Clause 3, which deals with authorities administering housing benefit or council tax benefit, enables the Secretary of State or the Northern Ireland Department to pass information to local authorities, which would include the data to which my hon. Friend refers.
  Mr. Faber: I thank my hon. Friend. That clarifies the situation, which is not explained in clauses 1 and 2. It is vital that information is passed to local authorities as they may need it most.

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  Another of the Select Committee's key recommendations was that local authorities should have access to the DSS central index computer which deals with national insurance numbers. I think that I understood my right hon. Friend as saying that the Government will accept that recommendation. It was accepted in the Government's response to the Committee's report, subject to certain strict criteria. Such criteria must be strict and the system must be policed sensibly and with great care, but local authorities need such information in the fight against fraud.
  I welcome the Bill's recognition of the role of local authorities in combating fraud. We have heard much in this and in previous debates about some local authorities' reluctance to pursue fraudsters in the past because of ideological opposition. I think that we have moved from that argument and the Bill presents an opportunity to understand the rewards for local authorities and the penalties for those that do not perform well.
  Mr. Bernard Jenkin: Does my hon. Friend agree that, while some local authorities—notably those in the London area—produced strong evidence that they required extra powers and that the local government culture needed to change, the vast majority of local authorities tended to say, "That sort of thing does not happen here"? The Committee and my right hon. Friend the Secretary of State have succeeded in changing the culture so that every local authority is aware of the potential for benefit fraud—however leafy the suburb.
  Mr. Faber: I agree with my hon. Friend—and particularly with the relevance of his last comment. In the course of our investigations, it was interesting to learn how many local authorities—sometimes those in our area or in neighbouring areas—did not accept that fraud occurred in their jurisdictions. If nothing else, the Committee's report helps to highlight that fact. I join my hon. Friend in paying tribute to the representatives of the London authorities who appeared before the Committee: they understand the nature of the problem and they have decided to tackle it on a grand scale. I hope that some of their experiences and some of the measures in the Bill will give local authorities throughout the country the chance to pursue that. I hope that the Bill will open up a new area of co-operation between the DSS and local authorities.
  As my hon. Friend said, the performance of local authorities is still extremely variable and needs to be improved. Some £1 billion of fraudulent claims—or 25 per cent. of all benefit fraud—is attributable to housing benefit or council tax benefit fraud, and therefore my right hon. Friend's creation of the benefits fraud inspectorate is especially welcome. Its role will be to help and improve the performance of the worst-performing councils and to advise on best practice. It will have a powerful role to play in the fight against fraud. I reiterate that it is vital that the inspectorate is set up in liaison with local authorities and that it is given powers to consider all the bodies involved in the fight against fraud, including the DSS and the various agencies within it, which already have an excellent record of combating fraud.
  It is good news for local authorities that the Bill will give them the same powers as the Benefits Agency to enter business premises, including those of landlords, to
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  inspect documents. We heard about that during my right hon. Friend's speech. There seems to be an anomaly in clause 10 in that if a private sector landlord works from both business and residential premises, inspectors will not be allowed to enter the residential premises. Many people, in all walks of life, take business home with them. On page 16, the Bill says:
  "a private dwelling-house is not liable to inspection under this section unless an inspector has reasonable grounds for believing that a trade or business is being carried on from the dwelling-house and that the trade or business is not also being carried on from premises other than a dwelling-house."
  Many hon. Members take work home, and many of us work from home. If inspectors do not have the power to enter residential premises and business premises, fraudsters will simply take the relevant papers home with them and they will be lost. I should be grateful if my right hon. Friend would consider that potential loophole.
  The Select Committee also recommends that the base line subsidy figures for local authorities should reflect the authorities' failure in combating fraud. I welcome the proposals in clause 9 to strengthen my right hon. Friend's powers to adjust housing benefit and council tax benefit subsidy. If an authority fails to reach the standards that he has directed them to attain, he may deduct some subsidy. Similarly, he may add to the subsidy of successfully performing authorities. That proposal is at the heart of improving the performance of poor authorities and rewarding good local authorities. I must tell the hon. Member for Peckham that it is a welcome response to one of the Select Committee's recommendations.
  Another Select Committee recommendation, on the prosecution of fraudsters, has been included in the Bill. I refer to the proposed legislation covering impersonation and the sanctions and penalties that are available. I welcome the introduction of a new offence of dishonestly reporting or failing to report a change of circumstances, which will trap those who give false information or conceal information to get benefits. Quite rightly, they will be liable to a term in prison of up to seven years. The existing offence of obtaining benefit by false representation will be extended and it will become an offence for somebody to fail to report a change of circumstances, or to get somebody else to do so on their behalf.
  Clause 13 provides for payment of a financial penalty, which makes a sensible civil alternative to prosecution. Where such cases are proved, the claimant will pay a penalty, as my right hon. Friend told us, at 30 per cent. of the overpayment.
  I warmly welcome the proposals in clauses 18 and 19—again, they were recommended by the Select Committee—relating to the redirection of post. In future, local authorities will be able to ensure that post marked "do not redirect" will not be sent on. Similarly, the Post Office will be required to provide any information as needed relating to the redirection of benefit payment post. That proposal will greatly help the Benefits Agency and local authorities to trace and catch multiple applicants, and should prevent fraudsters from making claims from different addresses and then having the money sent on to them.
  Perhaps the Select Committee's main disappointment will be the lack of specific measures in the Bill to combat organised landlord fraud, about which we heard a great

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  deal during the debate. However, I acknowledge that plans for the fraud inspectorate are wide reaching and that it can pursue specific proposals to fight landlord fraud in conjunction, I hope, with local authorities. I hope that the inspectorate will have a wide enough brief to take on the issue of landlord fraud.
  My right hon. and learned Friend the Chancellor of the Exchequer will present his Budget tomorrow. Whatever is contained in it, there is no doubt that social security fraud has reached a high level of public awareness and understanding, and that applies to hon. Members on both sides of the House. Nothing outrages the honest citizen or taxpayer more than the thought that he or she is being ripped off. We now know that the figures involved are considerable and we have to tackle the problem.
  The hon. Member for Peckham was churlish in the extreme in her earlier remarks. The Bill is a natural progression of the Government's battle so far against social security fraud. I welcome the fact that my right hon. Friend has listened to what the Social Security Select Committee had to say, and I warmly support the Bill.
  7.15 pm
  Mr. Frank Field (Birkenhead): As always in these debates, it is a pleasure to follow the hon. Member for Westbury (Mr. Faber). He was careful in the way in which he examined the Bill and he highlighted the aspects in which the Select Committee may have played some part, which I might have forgotten to do, so I am grateful to him. I shall address other issues.
  The difference in the Secretary of State's speech today was noticeable, and it had two parts. He is very much at home with the subject, and in presenting an anti-fraud Bill, which, we are told, has considerable political popularity. I was struck at the somewhat down-key tone in which he presented the Bill. That became even more marked when he presented Labour's proposals. The whole debate changed gear. His tail was up and an interest became apparent that was not there when he was explaining the Bill to the House. I was puzzled by that.
  Mr. Bernard Jenkin: The hon. Gentleman has often encouraged local authorities and others and, indeed, the Government, to come forward and celebrate the fact that they are discovering and uncovering fraud. Is it not crucial that we should not be ashamed of the fact that we find that things are not as well run as we had thought, because that shame inhibits the very process that we want these organisations to carry out?
  Mr. Field: I could not agree more. For example, when my hon. Friend the Member for Vauxhall (Miss Hoey) reports to the House how effective Lambeth is becoming in tackling fraud, I deplore the jeering of Conservative Members, because she is admitting that we need honesty in the debate. We might exchange figures for the total of fraud, but the awful truth is that we do not know. As the Government introduce more measures, more gains are chalked out for taxpayers. We are certainly not in the stage that economists talk about—decreasing returns.
  I shall present to the House what I consider to be the reasons for fraud, as we need different approaches to tackle the main groups that undertake fraud, and in so doing I know that the argument that I shall make will be crude, because a multiplicity of individuals are doing all
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  sorts of things for different reasons. There are three themes among those who commit fraud. If taxpayers think that people adjusting their circumstances so that they can claim benefit fraudulently, not just behaving as rational economic men and women, is something new, they are wrong; that has been done since the creation of the welfare state. Lloyd George introduced means-tested pensions for the over-70s, in 1909–10, and we know, from looking at the censuses of 1901 and 1911, that the number who claimed to be over 70 rose by 84 per cent. People seeing an opportunity for fraud is not new. Politicians have underestimated the ingenuity of the human character in making the most of what is on offer. Fraud by individuals is not new.
  However, certain fraud committed by individuals is new. That is partly due to the fact that welfare is increasingly means tested. Once people are claiming means-tested help, it is difficult for them to disengage themselves successfully by their own efforts. The Government are guilty of not knowing their history: the Victorians and Edwardians insisted that people should be prevented, at all costs, from falling on the Poor Law. Once they had claimed under the Poor Law, they could not fall any lower, and it was difficult to get them off the Poor Law. We have seen that happen with claims for means-tested assistance.
  The age in which we live has had an effect, partly because of Government policy, but more importantly because of changes that have occurred worldwide. Hon. Members who represent poorer constituencies—as well as those who represent richer ones—have seen what has happened to the labour market, particularly in relation to the poorest paid. The jobs that they could at one time have expected have disappeared like snow disappears as the sun hits it. Many of them have scrambled around to find a new position in the labour market which is far less advantageous than the one that they previously held.
  One reason for the increase in fraud is that people have been eager to prevent their fall in living standards from occurring too swiftly. They have sometimes claimed benefits to which they were not entitled, and sometimes claimed benefits to which they were no longer entitled when their circumstances changed, although they had originally been entitled to them. We must bear in mind the fact that some of our constituents have lived through an industrial revolution as great and as forceful as the agricultural revolution, during which many people were freed from the countryside, and were then pushed into the towns. For some of our constituents, the changes have been as dramatic as that first great change. That has been mitigated by the fact that we now, thank goodness, have a welfare state to prevent the destitution and worse suffered by some of our ancestors.
  We should not underestimate how swift the changes have been, how great the drop in living standards has been and how tempting it must be for individuals, especially those with children, to try to slow down the fall in living standards that they would otherwise experience if they did not claim help.
  Mr. Stern: I do not want the hon. Gentleman to think that I disagree with everything that he has just said, but it occurs to me that he may be dealing with the wrong problem. The Bill is not really designed to combat the small-scale fraud that he has described and into which he thinks people have been led. By and large, the people

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  whom we are attacking in the Bill are not those who are trying to gain little on benefits—although they may be dragged into some of the frauds that we are dealing with—but those who are trying to obtain large sums. They are the real criminals, and they would not be in the position of those whom the hon. Gentleman has just described.
  Mr. Field: I am usually—although not always—pleased to give way to the hon. Gentleman, and that is so tonight, because he makes the point that there is a third group of people who are serious about committing fraud against the social security system. Given human nature, we should not be too surprised by that. The Secretary of State is responsible for the largest Government Department—it is larger than most of his colleagues' Departments put together—so it would be amazing if no serious fraud were committed. We must be ever vigilant and, sadly, continually review ways to combat fraud. We must bring measures before the House for its approval to strengthen our fight against fraud.
  The Bill comes into play when we consider that third group. It was difficult to understand the Secretary of State's low-key approach in his opening remarks compared with the fun that he had attacking Labour's supposed position on countering fraud. The hon. Member for Westbury expressed disappointment that the Bill does not contain a clause that deals specifically with landlord fraud. There is a struggle over the agenda on fraud. Naturally enough, the Opposition are concerned about organised fraud, whereas Conservative Members think that individual claimants are up to no good and should be walloped. In fact, both groups are committing fraud.
  It is significant that the group highlighted in the report of the Select Committee on Social Security, although it may not account for most of the benefit fraud, clearly accounts for a large part of it. It is surprising that the Bill contains no specific recommendation on landlord fraud, although it involves fewer people. We may return to that when we take the Bill through Committee.
  The absence of a clause dealing directly with landlord fraud leads us to consider the Government's attempt to create a public image that shows that they are getting on top of this small-scale stuff. I questioned the Secretary of State in the House about the fraud hotline. I had been given to believe that 90 per cent. of the information provided through the hotline was not useable, because the staff were not trained and many of them were temporary. The Secretary of State had not taken seriously the fact that such information could be valuable if only he would go a little further and provide decently trained staff to undertake that task.
  That is not an isolated example. I read in a press release issued last week that the hon. Member for North Hertfordshire (Mr. Heald) is the fraud Minister. We should call him the anti-fraud Minister, not the fraud Minister. In the press release, the Minister tells us about a new initiative, and uses phrases such as "new tracing service", "important new weapon", and "rapid response arrangement". Anyone would think that we were getting ready to invade the Gulf. That new initiative is about the P46.
  Mr. Lilley: It is very important.
  Mr. Field: I agree with the Secretary of State that it is important. Employers have to complete a P46 when
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  people turn up for employment without a P45. The initiative with its "new tracing service", "rapid response" and "important new weapon" is to ensure that employers send the P46 to the Benefits Agency. Neither the Bill nor the press release tells us about the staff who will follow up employers who do not do so. We do not have a problem with honest employers, because they already send in those forms. The problem is with employers who collude with claimants. They often suggest to claimants that they should accept the wages being offered and draw benefit at the same time. What measures are the Government taking to ensure that the "new tracing service", the "rapid response" and the "important new weapon" will have the resources to follow up employers?
  Mr. Heald: The hon. Gentleman often talks about national insurance numbers. The point about the P46 tracing service is that, if an employee has no national insurance number, a P46 form must be filled out, and will immediately go through the system to the Department of Social Security. The hon. Gentleman also mentioned collusive employers. We have collusive employer teams throughout the country, and they are working actively with all the most modern surveillance techniques to catch employers who are behaving in that way.
  Mr. Field: I am grateful to the Minister, particularly for that last sentence.
  We ought not to overestimate what we can do in this place by proposing Bills that we hope will become Acts, although they clearly provide important frameworks. People must then implement what we have decided should be the law.
  I do not want the debate to end without our complimenting the staff who perform their duties to combat fraud—a task which, I believe, will become more difficult and dangerous. Until now, people have not been as keen on tackling fraud as they should have been, and that has influenced the way in which they regard the staff who carry out those important functions. I support those who, on behalf of taxpayers, are trying to protect the public purse—people whom, in many instances, we should re-evaluate. I hope that we will do that before we hear too many stories about the physical danger to which they are already exposed, and will be exposed increasingly. If the Bill is as successful as the House hopes that it will be, many people who are taking large sums of public money when they ought not to be doing so will no longer be doing so, and I do not expect them to allow that money to go without a struggle.
  7.31 pm
  Mr. Bernard Jenkin: It is always a great pleasure to follow the hon. Member for Birkenhead (Mr. Field). I pay tribute to the work that he does on the Select Committee. He leads a very happy band of men and women, and inspires us all with his leadership. Although I have not had the benefit of having served on another Select Committee, I think that his is probably the best on which to serve.
  We are, perhaps, blazing quite an innovative trail for a Select Committee, because we are not only scrutinising what the Executive does but playing an active part in the formation of policy—reflecting, perhaps, something of an emerging consensus among intelligent people in this

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  place, and leaving aside some of the more tiresome party political prejudices that often do not do hon. Members as much credit as they think.
  I welcome the Bill. It is an important contribution to the debate on this subject, and reflects very well on my right hon. Friend the Secretary of State. He has worked hard to change the culture surrounding social security fraud. The data-matching provisions are a sine qua non for proper policing of our benefits system; I hope that data matching will eventually lead to the establishment of a single on-line database for all social security benefits, because so many opportunities for fraud arise from the difficulty of reconciling the different bodies of information that are contained on different computer systems and relate to different benefits.
  If only it were possible, with a single record of a national insurance number, to have a complete record of all the funds going in and out under that number, we should be much nearer to avoiding, for example, the absurd situation that allows someone who is contributing to a national insurance fund on his or her own number to find out—perhaps months later—that someone else is claiming on the same number. The inclusion of data-matching provisions will go a long way towards preventing future abuse of that kind; but, until we have a single on-line database making all the information relating to all the benefits and contributions of one individual available on one screen, it is difficult to see how it can be prevented—particularly when it is possible to match data only on the basis of intervals. It was nice to think that that would be done weekly, but I imagine that monthly, quarterly or even six-monthly will sometimes be the norm.
  Mr. Stern: My hon. Friend has suggested a complete rounded record of ins and outs, but, in the context of the Bill and the prevention of fraud, what he is looking for—and what we hope to achieve—are data-matching provisions. Does he not fear, however, that the system that he is describing would impinge rather more on individual liberties?
  Mr. Jenkin: That may well be a price that we must pay for allowing the state to tax us heavily and provide all these benefits. I shall deal with possible solutions later, but we already allow the state to have this information about us. It seems absurd that we should not allow the various organs of the state to share and develop the information effectively in order to protect taxpayers.
  I am afraid that there is no substitute for the principle that those who are doing nothing wrong have nothing to fear. I appreciate that that is not a universal defence for state intrusion, but I think that in this instance it weighs pretty heavily, given that it is taxpayers' funds that are being abused, owing to our failure to use information effectively.
  I welcome the inclusion of new offences in the Bill. I hope that the law will be strong enough against the multi-landlord fraud referred to by the hon. Member for Peckham (Ms Harman) and others. I appreciate the difficulties involved in creating new offences, and the difficulty of testing them in the courts to make them effective, and I understand that it is much easier to develop existing offences to ensure that people are caught; but I hope that that provision will be developed.
  I also welcome the new powers for local authorities, which will enable them to exchange information and withhold benefit. I re-emphasise the importance of
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  allowing those who give out benefits to withhold benefits. I even question whether we should continue to talk about welfare rights, rather than about the taxpayer's right to withhold benefit when there is doubt about whether a payment should be made.
  Obviously, one objective of the benefits system must be to ensure that those who deserve help receive it, but too often the burden of proof required for the claiming of a benefit has been much less than the burden of proof needed to withhold it. That is an extraordinary state of affairs, which leads to much frustration when people do provide the authorities with evidence of potential benefit fraud, and then see that neighbours who they strongly believe are defrauding the system continue to benefit from their duplicity. I also welcome the introduction of a fraud inspectorate.
  The whole Bill reflects a very positive change in the culture and outlook relating to benefit fraud. It is, I think, for us Conservatives to give at least two cheers for the Opposition parties, which for a long time tended to attack Conservative attempts to deal with benefit fraud, but which have now realised that, in order to sustain the integrity of the benefits system as a whole, it is necessary to restore the feeling among ordinary people—including ordinary taxpayers—that the system is not being taken for a ride. It is a little sad that the Opposition Front-Bench team are now perhaps over-egging the pudding, but if that serves to highlight the problem in the system and to continue to help changing the culture we will live with that.
  In the next few years, there will be no substitute for fresh thinking on a complete change in the welfare structure, because fraud is encouraged by that very structure and by the way in which it affects people's work incentives and their outlook as they search for a job and try to climb out of the system. There is no resisting the conclusion that no amount of policing will make this a rational system of distributing help to poorer people.
  We need a major change in the state benefit culture—for several reasons, not least cost. The benefit system takes nearly one third of total Government spending—it is not just the biggest programme in central Government, but the biggest programme by miles. My right hon. Friend the Secretary of State for Social Security quoted the cost as £15 per day per working person. When ordinary people are confronted with the scale of the cost in those terms, they are appalled, and it should appal us that the burden and cost of state welfare still do not create the happier and more contented society that we must have expected, or certainly that Beveridge must have expected if he ever thought that this much money would be spent on the welfare state.
  If one programme has blown the Government's taxation policy off course, it would be the regular annual increases in the social security burden—the increases are far bigger in this Department than in any other Government Department. It should have dawned on Opposition Front Benchers by now that if, God forbid, they were ever to assume office, they would be confronted with the same problems, and that all their spending promises and tax-cut fiction would be quickly burnt before their eyes as they tried to contain social security costs
  That means that we must consider three ways to start bringing down the cost of social security. The first involves savings for retirement. We must improve not

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  only the incentives for saving for retirement, but the spread of savings for retirement. They must go beyond just retirement. We should encourage people to save, where they can save, for other eventualities, so that they do not, as a first recourse, fall back on the taxpayer.
  Secondly, out of those savings, we should encourage people to take out much more private insurance for disability and for unemployment. Those should not be regarded as avant garde, off-the-wall ideas of some mad think tank. Those are the ways in which other societies are managing their welfare systems.
  We should be able to learn from them to reproduce the same benefits, because, until we can encourage and enable people to self-provide such benefits much more for themselves and for their families, we will never be able to deal with the tax and benefits trap that so undermines the labour market's efficiency and ordinary people's ability to provide for themselves and their families in a dignified way, as we would hope.
  Finally, we need to change the whole culture of giving out benefit. It should not be a simple financial transaction that absolves the taxpayer and the Government of any further action. In reference to other legislation and measures that the Government have introduced, the workfare experiment is exactly the sort of active help and responsibility that should accompany financial assistance to the least well-off.
  It is not good enough for ordinary taxpayers to pay tax, knowing that the Government hand it over to poor people, and to say, "That absolves us of all responsibility of any other help that we might need to give those people." It is incumbent on the system to provide active and intelligent encouragement, so that the receipt of benefit is accompanied by some compulsion on the individuals concerned to show that they are prepared eventually to help themselves.
  Mr. Frank Field: It is a matter not just of what is good for taxpayers: it is proper for the people themselves. For example, many of our constituents want to join job clubs immediately to help them get back to work, but the rules prevent them from doing so until they have been unemployed for six months. We know that, with every week that goes by, it becomes more difficult to re-enter the labour market, so it is not a matter of taxpayers ganging up on claimants. This policy is in the best interests of claimants, many of whom want it advanced.
  Mr. Jenkin: If the hon. Gentleman studies Hansard, he will find that I more or less made that point just before he intervened.
  Mr. Field: The hon. Gentleman does not have to admit that, if he changes Hansard.
  Mr. Jenkin: I am shocked that the hon. Gentleman should suggest that I should commit such a fraud on the House. I am gratified to see that he is jesting, and I accept his unreserved apology.
  For all hon. Members and all taxpayers who contribute to the system, perhaps the most sobering thought is that this massive expense fails the recipients so miserably, as the hon. Member for Birkenhead has described. Instead
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  of being the help and salvation that we want welfare to be, it remains a dead weight and a disincentive for the vast majority of people, whose good qualities we know.
  7.47 pm
  Ms Liz Lynne (Rochdale): We must remember that social security fraud is not a victimless crime. Someone else has to pay for it—the taxpayer—so any clampdown on benefit fraud is welcome. We must, however, have safeguards.
  As we all know, fraud is a widespread criminal activity. It is estimated that, this year alone, £4 billion has gone on benefit fraud and that only £1 billion of that is detected, so, each year, £3 billion goes undetected. The Government are now tackling benefit fraud, which I welcome, but, in part, they were responsible for its increase, particularly because of the cut in home visits. In 1979–80, there were 6.5 million home visits. In 1994–95, that went down to less than half a million, so it is hardly surprising that, as home visits went down, benefit fraud went up, or that many people were fiddling the system.
  Most of the specific provisions in the Bill are sensible, modest and much needed. Clause 6, for instance, gives the Audit Commission powers to help the Secretary of State for Social Security in studies to improve the administration of housing and council tax benefits. That will be of tremendous help to local authorities in particular.
  Local authorities have differing rates of success in tackling housing benefit fraud. The unit for the study of white collar crime said—I would like to blow the Liberal Democrat's trumpet about it—that Liberal Democrat local authorities have the best record of tackling housing benefit crime. Perhaps that is because we have had investigators in place for a little longer than some other authorities. We have to improve on that record, even though it is extremely good at the moment.
  Mr. Bernard Jenkin: I do not want to spoil the hon. Lady's fun, but in Colchester the Liberal Democrat authority was recently highlighted as having lost about £500,000 on housing benefit fraud. I know that it is now taking that very seriously, but I do not think that the Liberal Democrats have a universally unblemished record on the matter.
  Ms Lynne: I am not saying that we have an unblemished record, but, according to the unit for the study of white-collar crime for the Liverpool business school at Liverpool John Moores university, we have a better record than Conservative or Labour-controlled councils. If the hon. Gentleman would like to see a copy of the report, I would be very glad to give him one. I do not believe that any local authority has an unblemished record; all local authorities could do better. All I am pointing out is that Liberal Democrats have quite a good record because of the investigators who are already in place. Of course, we have to build on that success.
  One of the Bill's main aspects is the lifting of barriers between Departments so that information can be shared, which I welcome. Data-matching can be highly effective. I also believe that caution is needed to prevent the misuse of confidential information. There ought to be more liaison between Departments. I asked the Home Office not so long ago for statistics on prosecution for organised

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  housing benefit fraud, but it had none. Departments should take a leaf out of their own books and carry on from the Bill, to establish some real liaison and find out how many prosecutions for organised crime are occurring, particularly for housing benefit.
  Another part of the Bill gives local authorities and the Department of Social Security access to the Post Office database for redirection of mail. The assistant registrar to the Data Protection Registrar expressed concern about that, saying that, unless data matching techniques were supported by skilled human intervention and adequate safeguards, there could be problems.
  "It may create serious adverse consequences,"
  he said.
  I should like to give the House an example of the possible problems. I hope that the Minister will give a reassurance on safeguards in his winding-up speech. Say, for instance, that a husband is working in a DSS department and the wife has been the victim of domestic abuse by the husband. She moves and has her mail redirected. We need to ensure that there are safeguards to prevent the husband from being able to tap into that information for purely personal reasons and find out where his ex-wife has moved to.
  I should like some reassurance from the Minister that that cannot happen, and that, if it does, there will be safeguards or rules to ensure double checking within Departments on why the person needs the information.
  So many other problems could arise. People could misuse information for criminal activity. We need to ensure that Departments and people who work in them do not tap into the database to get information to sell on. I know that some Departments have been worrying about that already. When the Bill is passed, as it undoubtedly will be, we need to know that there will be safeguards against such activity.
  The point made by the hon. Member for Peckham (Ms Harman) has been raised by Age Concern in particular. If data matching can be used to check fraud, why can it not also be used to ensure that people, especially pensioners, receive the entitlements that they should receive? There should be a benefit take-up campaign at the same time. More than 1 million pensioners are not getting the income support or income-related benefit to which they are entitled. If they do not receive income support, they cannot receive cold weather payments either. About £1 billion goes unclaimed. Given what is already in the Bill, the Government could act to include such a measure in its remit.
  When I asked the Under-Secretary about the take-up during Social Security questions, I was very disappointed with the reply. He said:
  "No other strategy would work better than what we are doing."—[Official Report, 12 November 1996; Vol. 285, c. 146.]
  When £1 billion is not being claimed, I do not honestly believe that the strategy is really working. All parties must address the problem, and the Government must address it through a take-up campaign. I believe that measures to solve the problem can be encompassed in the Bill's remit, despite whatever European directives or the European Commission of Human Rights might say.
  Mr. Heald: How does the hon. Lady think that the data matching process she suggests could identify pensioners who are entitled to income support but do not claim it?
  Ms Lynne: If one is data matching, one has records of people's pension entitlements. Surely the information about the entitlement to income support of women who reach the age of 60 and men who reach 65 can be data-matched.
  Mr. Heald: I am asking how we would know. Clearly we know who the pensioners are and who is entitled to a retirement pension. We also know various other classes of information, but none of them will tell us that somebody was entitled to income support.
  Ms Lynne: The Minister is saying that we cannot use data matching for anything but benefit fraud. I do not understand his argument. If we can use it for detecting benefit fraud, it can surely be used to find out which pensioners are entitled to income support. I know that it will be difficult to trawl through the system, but I am sure that, with all the resources at their disposal, the Government can come up with some positive proposals.
  If the Government cannot do so in order that the problem can be solved in the Bill, perhaps the Minister can come forward with some idea of what take-up campaign he will put in place. There is no point in dismissing the matter out of hand. Many pensioners are not getting the income-related benefits or the cold-weather payments to which they are entitled. I am asking the Minister whether he thinks that such a measure could be included in the Bill. If he rules it out, fine, but he must at least admit that some take-up campaign must take place.
  Mr. Stern: The hon. Lady is placing far too great a reliance on data matching, and making the same mistake as the hon. Member for Peckham (Ms Harman). A typical pensioner could be receiving a state pension and a small occupational pension from a totally different source, and possibly have some savings income from the National Savings bank. No data matching system will bring that information together, because most of it is not declarable.
  Ms Lynne: The hon. Gentleman says that it is not possible to data-match in the Bill as I have suggested, and that data matching will not work. Does he therefore agree with me and other hon. Members that some take-up campaign is necessary? If the objective cannot be achieved through data matching, it has to be achieved in some way. I thought that there might be a possibility of achieving it in the Bill. If the hon. Gentleman and the Minister rule it out completely, what other suggestions do they have for a take-up campaign?
  Mr. Stern: I am grateful to have the opportunity to answer the hon. Lady. I agree that Governments must continually look at take-up campaigns. All I am trying to prove to her—she seems to have conceded the point—is that they are totally irrelevant to the Bill.
  Ms Lynne: With respect, I have not conceded the point. I asked the Minister: since it is possible to detect benefit fraud, might it not be possible to give pensioners the benefits to which they are entitled? I still believe that it should be looked into further, and I do not rule out the

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  possibility that we could do it. Technology is moving on. If it is not possible to do it within the remit of the Bill, we must have a take-up campaign, and the Government should commit themselves to that. I would be grateful if, when the Minister winds up, he will say that the Government will initiate a take-up campaign for pensioners.
  Clause 12 will extend the powers to cut off benefit for false representation and for change of circumstances. If somebody stops somebody else declaring a change in circumstances, he or she can be prosecuted. It is the right step to widen that offence, but we need a clear definition in the Bill. It is too loose and the citizens advice bureaux are worried about that. They fear that they might be threatened with prosecution if they advise somebody not to declare a change of circumstances because they feel it is not relevant. Could they be prosecuted? I would like the Minister to confirm or deny that.
  Clause 14 specifically deals with overpayment for one tenant that can be recovered from the payment for another tenant. In other words, if a landlord has been overpaid because one tenant has moved on, the agency can claim that money back by not giving as much money for the next tenant. I should like some assurances from the Minister that that provision will not, in his opinion, lead to more evictions. My fear is that the landlord, if he was not getting money for a particular tenant, might decide to evict that tenant. We should have more safeguards on that situation.
  I give the Bill cautious support. We will have to see how it pans out in Committee, and also when it comes back to the Floor of the House. When we go through those stages, it is vital that we ensure that genuine claimants are not penalised. I have some real fears that must be addressed during the passage of the Bill, but I repeat my cautious support.
  8.1 pm
  Mr. Michael Stern: We have heard several distinguished contributions to the debate from members of the Select Committee on Social Security and I am grateful for those. I come to the debate from a slightly different perspective. The Social Security Select Committee has been considering one aspect of benefit fraud, but as a member of the Public Accounts Committee, I have considered the problem because the remit of that Committee to ensure value for money in the collection and distribution of Government revenue is most obviously breached in areas such as social security fraud. Rather than adopt a benefit-led approach to the debate, I shall concentrate on areas in which I believe that the aim of the Bill needs to be considered, either in this debate or at later stages.
  Much has been said today about the data-matching provisions and the access to data, which the Bill provides in the form of additional powers for the Secretary of State for Social Security. I confess to one or two doubts in that area, not because I believe that the powers are unnecessary—they clearly are not—but because I wonder whether they are workable or go far enough. The Bill is specific about empowering the Secretary of State to obtain data from the Inland Revenue and Customs and Excise, but that would require some very powerful data-matching
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  tools. Social security benefit data are sorted by address of claimant. Inland Revenue data, by and large, are sorted by address of employer. Therefore, within one street one would have to match the records for 20 or 30 different districts of the Inland Revenue. Customs and Excise data are sorted by point of entry. Duties are, of course, collected and paid at point of entry, but various excise data are collected by business and are not necessarily related to the individuals to whom one wishes to match the data. An extremely powerful computer system will be needed to fulfil the requirements of the Bill. I wonder whether EDS Scicon, which automatically gets all Government computer contracts these days, will be able to deliver on the promises that the Bill makes.
  The Bill also does not deal with two further data matching problems. Two Government agencies—Inland Revenue and Customs and Excise—are specifically mentioned. One that I would have thought would have been particularly appropriate—the Child Support Agency—is not mentioned. I accept that any data coming from the CSA are likely to be somewhat out of date and probably inaccurate, but I would have thought that it was a potential source of data for the purposes of the Bill, both for what has been reported by one parent—whether the absent parent or the parent with care—and for what that parent has reported about the other. All hon. Members present will be aware of the day-to-day experience in our surgeries when a parent comes in to complain about the work of the CSA—it is the second most common complaint I get—and tells us as much about the parent who is not there as about the one who is. Whatever inaccuracies are involved, there must be some way to feed that data into the system. I suspect that a number of potential frauds would be uncovered as a result.
  It is assumed that when data are collected, especially from the Inland Revenue and to a lesser extent from Customs and Excise, it will be linkable with the national insurance number of the claimant. I must inform my hon. Friend the Minister that that is not necessarily the case. There is a significant minority of taxpayers for whom the Inland Revenue, even now, does not possess a national insurance number. National insurance numbers given to employers are not necessarily often immediately checkable, and by the time the check has been made the employee may have moved on. I would commend for future development to my hon. Friend the Minister the system adopted for VAT numbers. Any taxpayer receiving a VAT number can, by operating a simple arithmetical check, determine whether the number is potentially genuine or false. Future national insurance numbers should be constructed on the same basis.
  In an earlier intervention, I said that I would return to the question of the penalty system and the system of prosecution. I strongly congratulate my right hon. Friend the Secretary of State and my hon. Friend the Minister on importing a penalty system in mitigation of prosecution into the social security fraud prevention system. That system has worked well for Customs and Excise and for the Inland Revenue and I have no doubt that it will significantly increase the financial benefits of the detection of benefit fraud. However, I chide my hon. Friend the Minister for not having taken the system over well enough. The provisions in the Bill provide that a person who wishes to avoid prosecution will be entitled to offer to repay the overpaid benefit plus a penalty of 30 per cent. That will be a fixed penalty, but my hon. Friend

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  the Minister has confirmed that the wording in the notes on clauses is somewhat loose and it will not be a mitigable penalty.
  In contrast, the system adopted by the Inland Revenue in cases of fraud starts with a potential penalty of 100 per cent. of the amount defrauded. However, the Revenue is then able to mitigate the penalty to take into account the degree of co-operation shown by the person accused, the seriousness of the fraud and the extent to which the disclosure of the fraud was voluntary. The result is that the Revenue makes a great deal of money by collecting penalties for fraud. Without similar powers—possibly starting with a higher penalty base—I fear that my right hon. and hon. Friends will not be as successful as the Inland Revenue in discouraging fraud. Before any Inland Revenue penalty comes into effect, the fraudulent taxpayer is obliged not only to repay the tax, but to pay interest on the tax defrauded. In itself, that sum cannot be mitigated and is often a considerable percentage of the tax defrauded—often rising as high as 100 per cent. of the tax repayable.
  Customs and Excise—according to traditions which go back centuries—adopt a rather more brutal approach to the collection of fraud penalties. The first thing that happens in a case of duty or excise fraud is the confiscation of the goods, so we are talking immediately about a penalty that often can be 200 or 300 per cent. of the amount of the fraud—and that is just for starters. As I have seen in my local customs house in Avonmouth, that system encourages people to own up. However, I am not sure that the Bill's provisions will be enough to encourage a significant increase in the collection of voluntary, admitted or co-operative payments of fraud penalties.
  I am particularly concerned by the alternatives offered in the Bill. If an offer of penalty is made—or, once made, is withdrawn within 28 days—the alternative facing the potentially fraudulent benefit recipient is prosecution. If he is found guilty, the penalty is a maximum of seven years—or 70 per cent. of the penalty for touching an unlicensed gun. Nevertheless, that is the penalty for someone who is found guilty. Where the Bill parts from reality is in the assumption that a significant proportion of serious fraudsters are likely to be found guilty when prosecuted for fraud in this country. Experience has shown us that that is just not the case.
  The chanciest area in terms of prosecution and in terms of someone being found guilty and given a significant penalty is in fraud. Our system just does not work—although it does make sure that there is a large legal aid bill. In looking in Committee at the penalty system—which is designed to recover money for the taxpayer—I hope that a greater emphasis will be placed on providing fraudsters with the certainty of a financial penalty, rather than the odds-on chance of escaping following prosecution.
  I wish to refer to an area of housing benefit fraud where the combination of the Bill and the valuable work of the Select Committee on Social Security does not necessarily lead to a just result for the taxpayer. Mention is made in the list of types of fraud that are to be tackled by the Bill of fraud involving housing benefit where the landlord is a relative of the tenant, and I wish to express a word of caution at this point. The way in which such provisions
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  are currently operated—particularly by local authorities—results in there being almost an assumption of fraud where a landlord and tenant are related.
  I have heard many cases where a person has made a perfectly legitimate arrangement with a relative for the occupation of a property which takes account of the desire of a person to help a relative, and it is that expressed desire—perhaps the charging of a lower rent—that gives rise to the suspicion of fraud. We must make sure that the public purse is protected when framing law in this area, but also that there is not an assumption that there is something basically wrong with a practice that would be regarded by people in many other countries as a normal family arrangement.
  Another area where benefit fraud is suspected—as has been mentioned in the accompanying literature—is in the right-to-buy scheme where a person who is not the occupier acquires the right to buy. However, I am concerned that we sometimes use this provision in the wrong way. In my constituency, there is a house known as "The Fortress" in Trowbridge road, Southmead. It is called that because of the defences that surround it. Very often, the only time people go in or out is when they are carted off in the proverbial black Maria. Bristol city council—in a laudable effort to try to disadvantage these people financially—tried to block their right to buy, but it was unsuccessful. I believe that it used the wrong provisions, and that the provisions for the removal of assets from ill gotten gains would have been more appropriate. The point that I am trying to make is that when we are designing fraud provisions in the Bill which affect benefits and the right to buy, we must be careful that these are not applied in entirely the wrong way.
  I welcome the provisions in clause 15 for the periodic Benefits Agency-directed review of benefits such as disability living allowance, disability working allowance and attendance allowance. I recollect with horror when I was first elected to the House taking up a complaint on behalf of a group of constituents about one of their neighbours who was obviously claiming one such benefit on a totally fraudulent basis. As no such power to deal with him existed at that time, it took two years for that benefit to be reviewed and then automatically removed from the individual concerned. We have needed these powers for some time, and I am delighted that they are in the Bill.
  Finally, there are a number of areas in the administration of housing benefit where there is an automatic assumption on the Conservative Benches that such administration will lead to fraud if it is in the hands of local authorities. As we heard from the hon. Member for Peckham (Ms Harman), there is an automatic assumption on the Opposition Benches that such benefit is likely to lead to fraud if it is in the hands of private landlords. We must be wary of falling into such obvious traps. The longest-running case of housing benefit fraud in my constituency—currently in its second year with the Parliamentary Commissioner—involves an alleged mistake by the Benefits Agency rather than by the local authority, despite the fact that there was an initial assumption that the local authority was at fault.
  We have great deal of work to do on the Bill and, if nominated to serve on the Standing Committee, I look forward to helping my hon. Friend the Minister to achieve

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  what could be a significant improvement in the take-up of public funds from the correction of the frauds that we have been discussing.
  8.18 pm
  Mr. Alan Howarth (Stratford-on-Avon): I am glad to follow the hon. Member for Bristol, North-West (Mr. Stern), whose speech was thoughtful and expert. If we should both find ourselves serving on the Standing Committee, we might disagree on some points, but I suspect that we would also be in some agreement and I am certain that he would play a valuable part in refining the legislation.
  We are all against fraud and while substantial criticisms should be made of elements of the Government's approach, I welcome much in it. In voicing some criticisms, I hope that I shall not be interpreted as seeking to undermine a proper determination on the part of the Government to eradicate fraud, using appropriate means.
  It is in the nature of fraud that it is impossible to know its extent. We should not underestimate it, but we should also not overestimate it. The Department's review of income support and unemployment benefit, published last year, told us that up to 10 per cent. of income support claims were fraudulent, but that figure included cases in which there was insufficient evidence to prove that fraud had occurred. One of four categories of suspected fraud is when a change of circumstances has been reported belatedly and overpayment has resulted. It is cynical to assume that there has been an intention to defraud in every case when a change has been reported.
  Similarly, in a paper on fraud associated with invalid carer's allowance, circulated to the Select Committee on Social Security, the categories of suspected and confirmed fraud were conflated to give a combined figure of 6.5 per cent. Official identification of fraud is cast into further doubt as the Department gives local authorities a financial incentive to classify housing benefit overpayments as fraudulent by offering a 95 per cent. subsidy where they detect fraud, but only 25 per cent. where overpayment is attributed to error by the claimant. While we must certainly be resolute in tracking down and dealing with real fraud, I must point out to Ministers as well as to members of the Select Committee that there is no virtue in overstating the problem—indeed, it is demoralising to do so.
  In framing the Bill, Ministers appear to have assumed that all overpayments are likely to be the result of fraud. In reality, misrepresentation may be accidental and innocent in intent. The scope, not only for fraud but for innocent error, grows with the complexity of benefit rules. As the Department pointed out to the Select Committee, the scope for fraud in relation to child benefit is not large because the conditions for entitlement are simple.
  With housing benefit, the situation is different. We all agree that housing benefit fraud is a major problem. Among the ways in which the Government should reduce it is by simplifying the conditions of entitlement as far as they can, which would help to reduce both fraud and error. The fact that innocent error is also a significant factor in incorrect payments is shown in another Department of Social Security research report—No. 43—which found that four fifths of housing benefit claimants with non-dependent deductions did not understand the thresholds for different levels of deduction.
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  The House must be concerned at the potentially arbitrary powers that the Government are asking Parliament to confer on them. Clause 13 provides for a penalty or fine of 30 per cent. of an overpayment to be levied when the Secretary of State or a local authority believes that there is a prima facie case of fraud and that there are grounds for prosecution. I do not like to see such summary powers vested in officials. It is inevitable that over-zealous or bullying officials or agents will from time to time abuse them, particularly if they are incentivised to do so.
  Nor am I happy with clause 15, which allows a review to be initiated of a decision relating to attendance allowance, disability living allowance or disability working allowance, even if no new information has come to light. Fishing trips, with unannounced visits, would be permitted under that provision to investigate and interrogate disabled people.
  Mr. Heald: I must question the hon. Gentleman's view of clause 13. The payment of a penalty is entirely voluntary as far as benefit claimants are concerned. If the claimant wishes to accept a penalty, he may. Otherwise, it is entirely up to the Department whether to prosecute him. The claimant is not forced to pay the penalty.
  Mr. Howarth: I accept that the option is proposed in the clause, but none the less considerable pressure will be put on a claimant who finds himself so suspected to settle for that payment rather than face the prosecution processes. One has to understand that although some sophisticated and ingenious fraudsters are exploiting the system, there are also some vulnerable people who are genuinely confused and who may panic if they are confronted with the sort of choice that the Minister envisages. That needs careful thought.
  However serious the problem of landlord fraud, we must think carefully before approving the power proposed in clause 14 to recover overpayments made to a landlord in respect of one tenant by deductions from the housing benefit paid in respect of another. That could lead to the harassment of tenants and to homelessness.
  There is a further hazard to civil liberties, and to privacy in particular, in this legislation. I refer to the powers that would be conferred through clauses 1, 2 and 3 to enable information held about individuals by the Inland Revenue, Customs and Excise and civil servants dealing with passports, immigration, emigration, nationality, prisoners and
  "any other matter which is prescribed"
  to be transferred and disclosed to the DSS. Clauses 3 and
  4 extend the provisions to local authorities and their contractors, who are also enabled to exchange information between them.
  There is a dilemma here for all of us. On the one hand, it is in the public interest to use the resources of information technology to defeat fraud. It may, indeed, be indispensable to do so if we are to defeat certain sorts of organised social security fraud. On the other hand, it is a cardinal duty of Parliament to safeguard the liberties of the people, including the right to privacy, which, though not yet expressly safeguarded in our law, has been regarded by custom and convention as a basic right and which we should protect.

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  Ministers are advancing into new territory in the Bill
  and they are pushing their invasion boldly and far. The European convention on automatic data processing of 1981 set out the principle that data collected for one purpose should not be used for another. That was written into the Data Protection Act 1984 as the third data protection principle, which states that
  "personal data held for any purpose shall not be used or disclosed in any manner incompatible with that purpose."
  Now under this Bill information gathered elsewhere and for other purposes is to be available for
  "preventing, detecting, investigating and prosecuting offences relating to social security and for maintaining and improving the accuracy of social security information."
  The House should note that the prescribed purpose is not confined to dealing with fraud, but extends to making
  more comprehensive the state's dossiers of information about citizens. We should also note that it is not merely
  civil servants and local government officers—people we are still disposed to assume are imbued with a public
  service ethos that will not allow them to commit
  impropriety—who may receive and disclose such previously confidential information, but employees of
  private firms contracted by public authorities to carry out tasks for limited periods.
  I am indebted to Liberty, with whom I have discussed
  the issue, for drawing to my attention remarks made by the Data Protection Registrar, commenting on the increased collection and transfer of information between Government Departments. She has warned of the dangers in those developments
  "for the use of information out of context to the detriment of individuals; for the wide replication of errors; for unjust decisions taken about individuals simply on the basis of a 'profile' which causes them to fall into a group with certain selected characteristics; for automatic decision-making based on facts of doubtful completeness, accuracy or relevance; for the surveillance of individuals. They intensify"—
  she said—
  "the need to keep data secure."
  Lord Browne-Wilkinson, one of our most respected Law Lords, has observed:
  "If the information obtained by the police, the Inland Revenue, the social security offices, the health service and other agencies were to be gathered together in one file, the freedom of the individual would be gravely at risk. The dossier of private information is the badge of the totalitarian state."
  I worry, therefore, about legislating to allow the Government or their agents to trawl through the files on each of us that are held across Departments and to collate that information. If we are to do so, we had better at least circumscribe carefully the conditions in which such activity shall be permissible.
  One safeguard should be that those wanting to undertake such a search should have to establish a prima facie case for doing so, and that a court order or warrant should be obtained when such a power is to be exercised. I recognise that such requirements would inhibit wholesale data matching; but we are talking of the use of powers closely analogous to stop and search powers, which the Home Secretary, to the anxiety of many of us,
  is currently proposing to extend in legislation on knives—and even he stops short of wholesale licence to the police to stop and search.
  A distinguishing factor in the Bill, and an additional objection, is that the citizen would not automatically know
  about the search into his affairs. It may also therefore be
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  appropriate for the person who is the subject of such a search to be informed that it is to be undertaken, what its findings have been and to whom they have been passed. There should surely be provision for complaints to be heard and for redress for any citizen who is the victim of error or injustice under procedures made legal in the Bill. There should also, I would think, be powers for the Data Protection Registrar to investigate and audit those procedures.
  I am naturally disposed to defer to the legal knowledge of my hon. Friend the Member for Peckham (Ms Harman) , but I am advised that it is questionable whether the proposals in the Bill are compatible with the European convention on human rights, to which Britain is a signatory and which the Labour party wants to be incorporated into our domestic law. The issue before us shows both the need for a domestic bill of rights and the difficulty of framing it so that it protects privacy but allows for adequate policing in the information technology age.
  We understand that the Government's concern is not only to root out fraud but to improve standards of administration and cut out waste of public funds. In that case, they must make a serious effort to improve the accuracy of the Benefits Agency. The agency's business plan for 1995–96 shows that targets for accuracy in benefits delivery have deteriorated; in effect, targets have been set to get more cases wrong.
  In 1995–96, the target for income support claims was to pay the correct amount in 87 per cent. of cases, compared with 92 per cent. in the previous year; for incapacity benefit, the target was 94 per cent., compared with 96.5 per cent. Those less demanding targets for two major benefits were not in fact met; the figures achieved were only 78.1 per cent. for income support and 90.7 per cent. for incapacity benefit. On the face of it, that is thoroughly unsatisfactory.
  Inefficient administration facilitates fraud. What proportion of benefit overpayments assumed by the Department to be fraud was in fact due to administrative error by the Benefits Agency? The chief adjudication officer, in his annual report for 1995–96, said:
  "I find it particularly disappointing to record again poor standards of adjudication in overpayments cases."
  Last May, the Public Accounts Committee expressed its dismay at income support errors amounting to £848 million, or 5.1 per cent. It also found it unacceptable that 24,000 claimants entitled to aggregate payments of £90 million in severe disability premiums since 1988 had not received their benefit until 1994–95, some of them dying before they received arrears of as much as £12,500. Even after the errors were drawn to its attention, the Department took three years to put them right.
  The Benefits Agency has cut its costs in areas such as home visits, which are a worthwhile investment, but in other areas its administrative costs remain disproportionately large. The £209 million spent on administration of the social fund is 46.3 per cent. of the outlay through the fund.
  There are grounds for worry that contracting out may make the administration of benefits worse. Service standards should not be sacrificed to cost cutting. The precedent of the contracting of the Benefits Agency administration in Lancashire and Cumbria to BET, which was a shambles, is certainly disturbing. Parliament will

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  need to scrutinise carefully the terms on which the Government propose to contract out the Benefits Agency medical service and indeed the administration of the entire Benefits Agency. Will fraud investigation itself be contracted out? If so, we shall need to be satisfied that appropriate safeguards are in place and to look closely at the basis of remuneration of fraud investigators.
  The vigilance and energy directed to eliminating fraud and administrative slackness should equally be directed to improving legitimate take-up of benefit entitlements. The amount unclaimed in means-tested benefits alone has been estimated as up to £3.46 billion. We have recently learnt from a parliamentary answer that no less than 956,000 pensioners do not receive income support to which they are entitled.
  Private sector housing benefit fraud has to be attacked, but let us also respond to the fact that there is a lower take-up of housing and council tax benefit among private tenants than among council tenants. Four out of 10 eligible couples were estimated not to be claiming family credit worth £270 million in 1994–95, and the figures are even worse for disability working allowance: the Department's new research report, No. 54, estimates that only one in five of those eligible were claiming it. If we are to have data matching, I hope that Ministers will consider seriously and constructively the Opposition parties' proposals to try to use it to improve take-up.
  The Secretary of State should take great care to ensure that his strategy to counter fraud does not deter genuine but unconfident claimants from taking up benefit. He should balance his drive against fraud with a positive drive to improve legitimate take-up, but to judge by his decision to abolish the benefits help line at the same time as introducing the fraud hot line, he is unlikely to do so.
  The Secretary of State should not allow his drive against fraud to discourage people from combining work with benefit to the extent to which they are entitled. At present, few people are recorded as using their entitlement to claim benefit while working up to 16 hours. I was informed in answer to a parliamentary question that only 4 per cent. of unemployment benefit claimants had earnings last February. The problem is that few people understand the complexities of the rules. Without the help line, they are less likely to find out the facts, and in an atmosphere of more severe policing of the benefits system they will be further discouraged.
  The new regulations on the computation of earnings, operational from today even though Parliament has not yet debated or approved them—but that is a separate complaint—are yet another set of changes for claimants to grapple with, and in significant respects will discourage carers from working, yet presumably we all agree that the bridges linking welfare to work need to be well signposted, unobstructed and, indeed, made more numerous and accessible.
  I support the essential purpose of the Bill to strengthen the Government's capacity to root out fraud, but I want it to be amended to protect citizens from the arbitrary exercise of power by the state and to safeguard due privacy. I want to see the campaign against fraud matched with better efforts to cut out other waste in social security administration and to ensure that people receive the benefits to which they are entitled.
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  The Bill is important and if the legislation is framed appropriately and implemented in the right spirit it could do much to rebuild confidence in the welfare state. If it becomes law in its present form, however, and if the emphasis on fraud drowns out balancing considerations, morale among claimants and those who serve them will fall yet further.
  8.37 pm
  Mr. Nigel Evans (Ribble Valley): It is appropriate that I should follow the hon. Member for Stratford-on-Avon (Mr. Howarth) on the subject of fraud: 22,892 people—his majority at the general election—in his constituency must be wondering exactly what happened.
  The hon. Member for Peckham (Ms Harman) implied that we had said that anyone claiming benefit or income support was a sponger. That is not the case at all. The social security budget is about £97 billion, and fraud is estimated at about £3 billion. The vast majority of people claiming social security are not spongers; they are entitled to the money and we would be extremely pleased if there were greater take-up.
  The hon. Lady mentioned pensioners. I would be delighted if more pensioners who were entitled to income support took it up, although I cannot for the life of me understand how the data-matching system to which she referred could match those who were entitled to that support if they were not already claiming it.
  That does not mean that we should not look at other ways of ensuring that pensioners who are entitled to benefits get them. I do not think, however, that any greater fraud was perpetrated on pensioners than when their Christmas bonus was stopped twice by the last Labour Government, when inflation reached 27 per cent., and averaged more than 15 per cent. That inflation rate robbed a number of pensioners of half their savings. That is what I call real fraud.
  We all believe that it is necessary to crack down on benefit fraud. It is an integral part of the Government's strategy to provide opportunity for all. It is the hard working classes who most support the Government's efforts. One need only visit the local pub to discover how angry the regulars feel when they read in the newspapers of someone who has been convicted of a fraud that has been allowed to go on for so long. They are delighted when such people are caught. They resent the fraudsters who rip the system off and often earn more than honest hard-working people. Such fraudsters are taking money from those who need it most, at the expense of the taxpayer and of those who should be receiving that benefit.
  As I said when I intervened on the hon. Member for Peckham, the Government already have an excellent record on fraud detection. In 1995–96, we detected £1.44 billion of fraud and next year we expect to save more than £1.8 billion. We will not be complacent about even that figure and we will encourage our local authorities to achieve an even higher savings.
  When I heard Labour Members say that they, too, wanted a greater crackdown on fraud, I remembered serving on the Standing Committee on the Asylum and Immigration Bill. I do not remember that the Opposition gave the sort of support that they should have offered when we cracked down on bogus asylum seekers who

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  come here and claim benefit. We were opposed by the Labour party when we made £200 million savings from those bogus asylum seekers.
  The background to the Bill has been well researched and the measures that it aims to put in place will take the fight to the fraudsters. More than 18 months ago, the Government conducted benefit reviews—detailed surveys of representative samples of claims for the main benefits—whereby investigators identified fraudulent or erroneous claims in depth. So far, income support claims and housing benefit claims have been reviewed.
  The work of Preston and Ribble Valley borough councils reveals what action has been taken as a result of those reviews. Only 15 per cent. of all benefit spending is devoted to housing benefit and council tax benefit, but those benefits account for 25 per cent. of benefit fraud. Local authorities are responsible for the delivery of both benefits. Housing benefit accounts for almost £1 billion of fraud, including about £150 million of fraud by landlords.
  Ribble Valley borough council is doing extremely well in the fight against fraud. It was set a baseline saving target on weekly benefit fraud of £37,427. That target has been exceeded and weekly benefit savings of £40,999 are being achieved. It has detected 53 cases of proven fraud—10 false rent rebate claims, 20 false rental allowance claims and 23 false council tax benefit claims. That is the small number of fraudulent claims that one would expect in a mainly rural area with a total case load of 3,887, of which 773 are local authority tenants, 679 private tenants and 2,405 are council tax benefit claimants.
  In Preston borough council's area, which covers part of my constituency, there were 950 proven fraud cases from a current total of 17,538 cases. In week 34 of the financial year, and given the baseline target saving of £320,245, it has reached a target saving of £900,000, or £26,470 a week, with a projected final figure of £1.4 million.
  One aspect of the housing benefit review that I support is the unannounced visit of fraud officers from 52 local authorities to nearly 5,000 representative claimants. Those visits have been very successful in Preston and no doubt they have helped the authority to achieve its fraud-busting figures. I particularly welcome clause 9, which strengthens the Secretary of State's powers to adjust housing benefit subsidy and council tax benefit subsidy or add to the subsidy depending on an authority's success in preventing and detecting fraud.
  The hon. Member for Birkenhead (Mr. Field) referred to Benefits Agency employees who visit people in their homes to investigate fraud. I visited the local Benefits Agency office at Preston a year ago and I was impressed by the dedication, skill and enterprise of the workers who have to detect fraud. I imagine that the dangers that they face may get worse as their case load grows. I hope that we will ensure that they not only receive the proper training that they deserve to foresee all the dangers that they may meet, but have full protection and backing from the Government to ensure that those dangers are lessened. Particular attention must be paid to the training of the women who work in the service so that they can protect themselves; perhaps they should not even turn up at some houses alone.
  It is important to combat benefit fraud and control the social security budget, which stands at £97 billion. That is equivalent to £15 in tax from every working person every working day. It is a massive bill and we must ensure
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  that everything is done to curb it without affecting those who need the money. The overall effect of the Government's social security reforms announced today will be a saving of £5 billion a year by the end of the century, and the figure is set to rise to £15 billion a year in the long term. The drive to contain benefit fraud is at the heart of that effort.
  My right hon. Friend the Secretary of State has put in place an organisational structure dedicated to tackling fraud. The fraud strategy group has been established to co-ordinate anti-fraud work across the Department of Social Security and its agencies and a senior official has been appointed to develop its strategy. Dedicated local fraud teams have been established, which has stopped staff being diverted from the fight against fraud to other work. That has enabled them to build up the necessary expertise, which is crucial and right given the pressures of work that they will face. A central computer system has been piloted to cross-check multiple housing benefit claims. Initially, that system covered 24 London boroughs and I hope that it will be extended to cover the rest of the country as soon as possible.
  I hope that when criminal rings of landlords and others who have made multiple housing benefit claims are caught and taken through the courts, they will be subjected to as much publicity as possible to deter others from such fraud.
  I was pleased to note that during the Under-Secretary's recent visit to Preston, the 100,000th call was taken over the fraud hotline. That demonstrates the public's willingness to get involved. They know who is claiming benefit illegally and are prepared to give information. They know that it is their money in the first place and they want to ensure that the available money goes only to those in desperate need.
  Since the hotline opened in August, it has been a phenomenal success, and has taken about 8,000 calls a week. I hope that that success continues. My constituents and I are fed up to the teeth with people defrauding the system at the expense of the taxpayer and to the detriment of those who desperately need the money. I hope that action is taken to ensure that the number of the fraud hotline is more widely known. It has already been shown to be a great success and I hope that it is given more publicity to ensure that it will be an even greater success.
  The review estimated that income support fraud is more than £1.4 billion. In fact, 9.7 per cent. of income support claims—about 560,000—were found to be fraudulent. That figure shows that although all groups of claimants commit fraud, certain groups are more guilty than others. Private landlords have been mentioned and action must be taken against the fraud that they are perpetrating.
  My local Benefits Agency office is working hard to ensure that money is saved and that fraudsters are prevented from abusing the system. I have received its information sheet on Blackburn and Accrington. From 1 April 1996 to 31 October 1996, 2,375 claims were investigated and the weekly benefit saving was £2.4 million. The instrument of payment saving was £239,000, so the total saving was well over £2.5 million. I congratulate the office on all its work. There are 860 cases that have yet to be completed. I hope that the Bill will ensure an increase in the number of cases successfully detected.

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  It is right to create an anti-fraud inspectorate to examine local authorities' performance and make recommendations to spread best practice. Some local authorities must be working much harder and using more effective mechanisms than others. A league table of local authorities showing which are more effective would enable the public to get to know which authorities are serious about detecting fraud. We can also ensure that the Secretary of State has the powers to direct local authorities that adopt a lethargic attitude to detecting fraud to take the necessary action.
  It is also right to withhold the subsidy paid to local authorities for administering their benefits. It is right, too, to strengthen the Secretary of State's hand with the penalties that will be available for those who perpetrate benefit fraud: seven years' imprisonment and unlimited fines. We must ensure that such penalties attract as much publicity as possible to deter people from fraud. Benefit fraud is extremely serious. It costs the country billions of pounds and we must take the necessary action to stop it.
  It has already been said that more cross-checking will ensure that people have only one national insurance number and that benefit claimants will have to show their national insurance number and a photograph, and give an address that can be confirmed and at which they can be traced. It is right that we should take such measures.
  I hope that the new technology—the cards—will be fully used. I also hope that the cards will be designed so that they cannot be reproduced and so that people will not be allowed to have more than one of them; otherwise the system will be extremely expensive and a number of people will circumvent it. We must ensure that the system is as tamper-proof as possible.
  We must ensure that the redirection of giros and benefits to properties is done at reasonable cost—I believe that the Bill deals with that. I hope that the Secretary of State will ensure that the Post Office will be encouraged to participate in anti-fraud measures and will do so, either for next to nothing or as part of its contribution to cutting fraud.
  I welcome the Bill and all the measures that my right hon. Friend the Secretary of State will be taking, which build on the provisions that he has already announced. He has the full backing of the people of the Ribble valley, who are sick and tired of the amount of money that is being stolen from taxpayers and from those who deserve the benefits. They wish him well and I am sure that they hope that the Bill takes its place on the statute book as quickly as possible.
  8.52 pm
  Mrs. Anne Campbell: I welcome the Bill's main provisions, particularly the prevention and detection of benefit fraud and improved benefit administration. It is not just the constituents of the hon. Member for Ribble Valley (Mr. Evans) who welcome the fight against fraud—my constituents certainly do. Many of them are hard-working, honest people who are struggling to pay their way; they feel particularly bereft because of benefit fraud, which takes resources away from them. In Cambridgeshire, huge Government cuts in recent years—particularly in education and social services—have led to a deterioration in the quality of life for many of my hard-working and honest constituents.
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  The great majority of benefit claimants are honest. The problem is that when fraud is rampant, many honest benefit claimants are also tarred with the same brush. We hear names such as benefit scroungers or benefit spongers—as Conservative Members have called them—and it is important to remember that those names apply to a small proportion of people claiming benefit. For many benefit claimants, there are no realistic alternatives. I refer specifically to that important, and unfortunately growing, group of people—lone parents, who cannot work because they are not paid enough to cover the cost of child care. They are therefore being forced by the Government's benefit system to survive on a very low income. Many lone parents struggle to give their children the best start in life against almost impossible odds. The Labour party will help that group of people with its proposals for a minimum wage, benefit tapers, out-of-school clubs and so on, as my hon. Friend the Member for Peckham (Ms Harman) outlined so well.
  Much has been said about landlord fraud by those who know of far more cases than I do. I am sure that landlord fraud is not unknown in my constituency, but I shall concentrate on the means to improve benefit administration, which must help those dependent on benefits. The long waits for claims to be processed often lead to homelessness and destitution. Many right hon. and hon. Members will be aware that many constituents visit advice surgeries to complain about slowness and inefficiency within the benefit administration system.
  Two or three years ago, when the disability living allowance was introduced, the process was in such chaos that many of my constituents came to me to complain that they were living in difficult circumstances because their claims were not being processed quickly enough. We must appreciate that increased efficiency in benefit administration often improves take-up, so perhaps it is not a cheap option.
  We have been sent a briefing by the National Association of Citizens Advice Bureaux, which cites a case of a man who started agency work and was paid fluctuating wages—a situation that is by no means uncommon in today's labour market and one that the current benefits system does not adequately take into account. The man claimed council tax benefit, housing benefit and family credit. Six months later, he received a letter saying that he had been overpaid benefit by about £1,000.
  When the client had an interview with the officer, he was first accused of attempted fraud because he had submitted only one wage slip with his first claim. He pointed out that that was all that the housing benefit department had demanded. He was so angry that he said that there seemed to be little point in claiming benefit and, at that stage, he was invited by the officer to withdraw his claim. The client was persuaded by his citizens advice bureau to continue to pursue the claim and to request a review of the overpayment because it had not arisen from any error on his part. However, many people do not take that view—they climb down and withdraw their claim. The Government think that they have made great savings in benefit fraud, but what has happened is that a perfectly innocent person has not claimed the benefit to which he or she is entitled.
  When tightening up on fraud, we must be careful not to penalise individuals, such as that client of a citizens advice bureau, who might well have been discriminated

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  against. We must also take into account the changing labour market and the fact that many people now do casual, short-term work. Individuals sometimes work one week, but not the next. The way in which the benefit system is currently framed does not cope adequately with that and many people find it difficult to survive as a consequence.
  The Bill permits data collected for one purpose to be used, after authorisation, for another purpose and I am interested in how those procedures will work—quite apart from the difficulties associated with the European Union directive that were so ably outlined by my hon. Friend the Member for Stratford-on-Avon (Mr. Howarth). Tax authorities, housing authorities, immigration authorities and a host of other agencies holding personal information will be required to make that information available for cross-checking against information held by other authorities.
  The simplest way to do that is via the exchange of computerised information. I have doubts about whether the numerous systems used by local authorities will be capable of coping with any sort of data-checking mechanism that is established by the legislation. Not only are there different systems within the Department of Social Security itself, in the Contributions Agency, and in the Inland Revenue, but probably every local authority has its own unique computer system that works on a variety of hardware and software and uses different methods of client identification. Simply passing the legislation will not completely solve the problem of checking for fraud: considerable technical difficulties will have to be overcome.
  I am also interested in the various layers of administration and inspection. Clause 5 refers to the persons who will report on administration, and I assume that they will form the inspectorate to which the Secretary of State referred in his opening remarks. Clause 6 refers to the Audit Commission, and I assume that it is to be given strengthened powers to advise the Secretary of State on methods used. In addition, clause 10 refers to inspectors appointed by an authority under instruction from the Secretary of State. That makes three layers of people who will be primarily involved in inspection, and I should be interested to hear the Secretary of State's proposals on how those three layers will work together so as to avoid duplication and overlap.
  We heard a Conservative Member—I am sorry, but I cannot remember which hon. Member it was—refer to the smartcard technology that the Benefits Agency intends to introduce. There was an interesting article on the front page of the Evening Standard last week, about the work of my constituent, Dr. Ross Anderson of the Cambridge university computing department, who has worked out how to beat the smartcard. Unless the Government have come up with a new smartcard technology that differs from the one currently used by the banks, they may have to think carefully about using it. I believe that the system is called "CAPS"—common accounting and payment systems—and is being introduced by the Benefits Agency using a smartcard. The Minister should take advice on that matter and I am quite sure that Dr. Anderson would be pleased to help.
  Will the Secretary of State tell us what plans he has to comply with the requirements of the European data directive? My hon. Friend the Member for Stratford-on-Avon has already pointed out that the data protection
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  principles of that directive state that personal data should be collected and held for purposes described in the data protection register and should be used or disclosed only for those or compatible purposes. I fail to see how the Bill's requirements fit in with the EU directive.
  The directive also states that the data should be accessible by the relevant individuals, who can correct or erase it when it is appropriate to do so. I see no mention in the Bill of individuals being able to correct or erase data and I should like to hear what plans the Government have to put those important principles in the Bill.
  I have read the Government's Green Paper, "government.direct", and I know that they plan to rationalise their entire information strategy. I am sure that a future Labour Government would wish to do so, but without the disregard for personal privacy that has been exhibited by the Government and is exhibited in the Bill.
  The Opposition support the EU directive, unlike the Government, who could only abstain when the subject came up for determination in the European Council. This is yet another European matter on which the Government appear out of line with the other states of the European Union.
  At this stage in the parliamentary cycle, I should have expected the Government to propose legislation that would actively contribute to the CHANGE programme in the Department of Social Security. We are more than halfway through the second year of the three-year CHANGE programme, and the Government have not appointed a contractor to carry out their computerisation strategy, ACCORD.
  It was predicted by the CHANGE programme that, by March 1998, £1 billion in Department of Social Security running costs would have been saved. I have spoken to several of the large computer firms that are bidding for the contract, and I have met no one who believes that savings of that magnitude will be made.
  It might be helpful to know whether the Government believe that the Bill will provide the legal framework for the ACCORD project, which is about creating a centralised database that several Departments can tap into.
  I am sure that the Minister appreciates that that saving of £1 billion will pose major problems for the next Government, whatever their political colour. One is tempted to believe that the current Government, knowing that they will not win the next general election, have decided instead to set land mines for the next Labour Government. Savings of £1 billion that cannot be achieved in the time scale are one such land mine.
  If the Conservatives win the next general election, it is obvious to us that there will be many black Wednesdays—black Wednesdays of their own making, set to trap the next Labour Government, as I am quite sure that the last one was, too. Is it not time that we said "Enough is enough," and gave the people a chance to decide?
  9.6 pm
  Mr. Harold Elletson: It is a pleasure to follow the hon. Member for Cambridge (Mrs. Campbell), who speaks with great authority about data protection and smartcard technology, but with somewhat less authority, I fear, about estimates of benefit fraud.

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  I very much welcome the Bill, which has been described by the Secretary of State as one of his top priorities and is among the top priorities of my constituents, who realise its importance to the economy. It is very important, as detected and undetected benefit fraud is estimated to stand at about £4 billion. An ability to tackle benefit fraud will enable us to provide services to people in need and to reduce the tax burden, which many, most or all Conservative Members very much hope will also be one of the Government's immediate and top priorities.
  I congratulate the Secretary of State on his achievement to date. As my hon. Friend the Member for Ribble Valley (Mr. Evans) said, significant expenditure savings have been made—£1.44 billion this financial year, £717 million in 1994–95 and £558 million in 1992–93—and the Department expects to make nearly £2 billion of savings in 1996–97. The record savings made in each of the past four years will give the Chancellor much extra room for manoeuvre tomorrow. We owe the Secretary of State and his Department a great debt of gratitude for that.
  The Bill will provide important new measures to tackle fraud, especially by increasing punishments for fraudsters and increasing the power of investigating authorities. As I said, it will be widely welcomed in my constituency and, I suspect, in other seaside resorts, which have become centres for benefit fraud, particularly housing benefit fraud.
  I am delighted that the Secretary of State has asked the local Benefits Agency investigating teams to target Blackpool and other seaside resorts and that they have achieved significant results. In 1995, the Blackpool Benefits Agency investigating team saved £3.2 million and in 1996 it will achieve an estimated £4.2 million. That is excellent and I urge my right hon. Friend to carry on the good work. Those savings are a result of the sort of operation carried out by the Benefits Agency in the past, such as Operation Sea Breeze. That operation specifically targeted DSS hostels, which have been a terrible blight on Blackpool and other seaside resorts.
  Dame Elaine Kellett-Bowman: And Morecambe.
  Mr. Elletson: Indeed, as my hon. Friend the Member for Lancaster (Dame E. Kellett-Bowman) said, it affects Morecambe and many other seaside resorts throughout the country. I hope that those activities will continue in the future because they are paying dividends in seaside resorts.
  I am delighted by some of the activities that have been undertaken by benefit fraud investigators and the Department of Social Security. One activity that has been especially successful is the benefit cheat hotline. Before it was introduced, there were 500 referrals a month in Blackpool, but the figure has now risen to more than 800. Another great success is Operation Peddler, which dealt with illegal street traders operating largely along the Blackpool promenade. Many of those traders were receiving benefit, which has now been stopped. That investigation involved many different investigating authorities, including benefit fraud investigators, the police and trading standards officers.
  Also successful was Operation All Sorts—they all have interesting names—which involved benefit fraud investigators, the police and the Department of Transport
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  and which targeted lorry drivers identified as being in receipt of illegal benefits and driving unsatisfactory vehicles. Many of those drivers had their benefits stopped as a result.
  The final great success was Operation Big One, no doubt named after one of Blackpool's leading tourist attractions, on which my hon. Friend the Member for Ribble Valley has ridden on Blackpool pleasure beach. It involved examining all the board and lodgings houses in the Blackpool area, to establish whether "customers" were still living at the addresses held on their benefit record. It was extremely successful, although there is still room for great improvement. In Blackpool and similar tourist resorts, much housing benefit fraud involves the provision of inaccurate addresses.
  I hope that the Secretary of State will order such investigations to continue, because total savings from those four exercises alone were more than £500,000. The Bill will help to continue that success story.
  My only concern is the attitude of some employers, particularly landlords, to benefit fraud. The Bill will help to deal with that. Many employers, particularly in seaside resorts and areas with substantial seasonal employment, are prepared to turn a blind eye to benefit fraud. Certainly that is true of landlords as well. We must toughen up on that aspect and the Bill will help to do so, as it gives local authorities the same powers as the Benefits Agency to enter business premises, including landlords' business premises, to inspect documents. That will be a significant improvement and will help to tackle a major problem.
  I have some concerns about the involvement of local authorities, which already have substantial powers to inspect businesses. Local business people often feel that they are wrapped up in unnecessary red tape and that local authorities behave like little Hitlers. I hope that the Secretary of State will assure us that the Bill will not have that effect.
  We must be careful about local authorities handling housing benefit. Some local authorities have a close, cosy relationship with some landlords and, especially in areas where landlords do a great deal of business and make huge profits out of the DSS, great care must be taken.
  I hope that my right hon. Friend the Secretary of State will examine closely the Blackpool Housing Forum in my constituency, which is a suspicious body that exists, supposedly, to advise Blackpool borough's housing authority, but which includes a large number of private landlords who have made a fortune out of DSS hostels, much to the detriment of the town. That relationship is far too cosy. If the Secretary of State intends to transfer powers to local authorities and ask them to investigate such matters, he must be sure that Labour-controlled authorities such as Blackpool will do the job properly.
  That is why I am pleased that the Bill introduces a fraud inspectorate, which will check up on Labour-controlled and other authorities that might not be doing their job and that might not be properly chasing fraudulent claimants. I hope that the Secretary of State will continue to monitor Blackpool borough council closely and to target seaside resorts, where big savings will be made. I hope that he will keep up the good work, which has delivered such benefits for our economy and which will have such significant results tomorrow.
  9.17 pm
  Mr. Henry McLeish: I follow the hon. Member for Blackpool, North (Mr. Elletson) with some caution, mindful of the fact that we may want to win the seat. Blackpool is clearly an interesting place. My constituents would be envious of operations with names such as All Sorts and Big One, about which I have heard very little. I await my next reading of a social security brief with enthusiasm.
  There have been many thoughtful contributions to the debate. We have reinforced the importance of the Social Security Committee in the work of social security generally, and we have arrived at a consensus that fraud is important because it is waste. Although we have differing views on the issues that we pursue and on the pace at which we do so, there is no doubt that every section of the House supports a firm clampdown on fraud. Labour signs up for that.
  Some might say that the Bill is too little, too late. Labour will look to the Committee to strengthen its provisions. We must ensure that the Committee focuses enthusiastically on a tougher crackdown on private landlord cheats. That is an important issue that has been ignored in the past. Outside bodies have given information to the Department, but I fear that the problem is only now being taken seriously, at much cost to the taxpayers of Britain.
  We must send a clear message that the apparent opt-out clause under which organised landlords have operated must be removed. If it is not removed in Committee, it will be removed by the next Labour Government. It is not too fanciful to suggest that a new breed of fat cat private landlords are living off fraudulent earnings. It is ridiculous that the House and the Department have not yet agreed to address that problem with vigour. I believe that the housing landlord and housing benefit issues should form the focus of our work in Committee.
  My concerns focus on four issues or central considerations that will influence our views. First, the Government have been in power for 17 years and it is clear that we are now talking about a crackdown on housing benefit fraud. We have seen enormous expenditure increases in the past decade and it is hard to escape the conclusion that the Secretary of State and his successive ministerial teams have been soft on landlord cheats. I am genuinely puzzled about why that is so.
  The Government have shown tremendous enthusiasm in pursuing individual claimants who have defrauded the system—and rightly so. However, we must have a level playing field: it cannot be right for the House to adopt a double standard. I believe that the country will support us in our call for the Government to do more to ensure that landlords are covered by the net. I hope that the Minister will confirm in his winding-up speech that that partial view of fraud in Britain will be changed in Committee—if not, a Labour Government will resolve the problem.
  The second and more serious consideration is that the Bill is a missed opportunity. The Government talk about welfare to work, but this is a crucial area where we can reduce the welfare budget. If individuals contribute to society, are productive and reinforce their self-worth, as a consequence they remove the burden of cost from welfare through participation in the market economy. Why does the legislation not refer to welfare to work and how to progress that goal?
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  The Bill also fails to mention improving the efficiency of social security administration. It is quite clear that many problems are caused by poor first-line social security decisions that create confusion and lead to overpayment. As my hon. Friend the Member for Stratford-on-Avon (Mr. Howarth) suggested, at the end of the day it is often difficult to distinguish between fraud and overpayment. The Bill does not address the efficiency of the system overall. In its briefing paper, the National Association of Citizens Advice Bureaux states:
  "At the same time, the Bill represents a missed opportunity to tackle the administrative shortcomings within the social security system and fails to take measures to deal with the problem of lack of take up of social security benefits".
  I shall deal with that issue in a moment.
  The Government's second consideration is why the Department seems to have a licence to print giros, but it does not have sufficient concern for the taxpayers or for the futures of those individuals within the system. I hasten to add that "spend, spend, spend" is increasingly the hallmark of a Government who take every opportunity to lecture us about fraud, welfare and the need to cut back. I urge Ministers to explain in their future deliberations and in Committee what they are doing to reduce the welfare budget. Later in my speech, I shall point to an unprecedented explosion in housing budget expenditure which has created the climate for a spectacular increase in fraud—the two issues are indistinguishable.
  The third consideration is the Government's need to create scapegoats. I ask the ministerial team: when everyone wants the Government to crack down on landlords, why do they want to crack down on local authorities? They are not the problem: they are part of the solution. Whenever there is the chance for consensus, partisanship leads to scapegoating local authorities and landlords. Of course local authorities can make much-needed improvements—we do not deny that—but social security and every aspect of Government that might be involved in the new matching process can do likewise. Why do the Government want to crack down on local authorities when we want to crack down on organised landlord fraud? Indeed, an article in The Guardian of 10 October, about the Conservatives in Bournemouth, said:
  "The almost traditional conference crackdown on benefit fraud was announced by Peter Lilley".
  The article went on, in a rather more cheeky fashion, to say that his speech
  "was not as well received as in previous years".
  I submit that the politics of fraud and the politics of crackdown may have prevented the level playing field—which we want to see and which would be in the interests of the country—from being developed.
  The fourth consideration that the Government must address is what purpose the Bill and their efforts are seeking to serve. Is it the political interests of the party, or is it the desire to help taxpayers and provide less punishment for some vulnerable groups? There is a commitment in the Bill for more reviews and more medicals for disability living allowance, disability working allowance and disability attendance allowance. Forgive us for being slightly suspicious that that might not be used for the best advantage of the claimants. We are dealing with people who have serious problems and who do not wished to be harassed. I would not like to

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  think that there is a pretext to attack those vulnerable individuals because of some Government mission, regardless of whether evidence of fraud exists.
  The Governments's policies on fraud are often distortion and hypocrisy hiding incompetence and complacency. Those might be harsh words, but I should like the Minister to tell us why, especially on the landlord fraud issue, the Government are now being dragged screaming to a position where Labour has been for a while and the country for some considerable time. The central challenge for the House is to look beyond Second Reading and to identify some of the crucial areas that will have to be dealt with in Committee.
  I raised earlier the question of housing benefit expenditure. I am a reasonable person. I am quite willing to listen to rational arguments, but I find it quite irrational that housing expenditure growth over the past decade has doubled. The Government have not caught on to the fact that there has been an explosion in expenditure and in fraud. The two do not seem to be linked in the workings or the minds of Government. It is quite damning that rent allowances in the private sector have not doubled but trebled. The cost has gone up from £1.6 billion in real terms to £5.7 billion. That is not short-change cash. It is the fastest-rising part of the Secretary of State's budget. We constantly hear about the need to control the rise in social security expenditure, but where do we see any practical demonstrations of it?
  Mr. Heald: The Bill will help.
  Mr. McLeish: We think that the Bill might help if it is significantly strengthened.
  The other telling feature about the private sector is that, apart from expenditure, the number claiming rent allowance has doubled from 1 million to 2 million since 1988–89, but at the same time the number of claims from public sector tenants has gone down by 0.2 million.
  Mr. Stern: I am listening to the hon. Gentleman's web of fantasy with great interest. Has he not noticed that, in the same period, the number of private sector tenants has gone up? One would therefore expect the number of private sector claims to go up.
  Mr. McLeish: Forgive me, I am not trying to be discourteous, but that was a very obvious intervention, and the point raised by the hon. Gentleman has been recognised. The point at issue is the volume of expenditure. Of course it has not gone up three times, and it is the refuge of the despairing to suggest that that constitutes a sensible intervention.
  It is no coincidence that the massive rise has taken place since 1989, and the taxpayer has just been brought in to sweep up enormous increases caused by some adjustments to rent. Over the past decade, £86.5 billion has been spent on housing benefit. If the Government want to be tough on fraud, they should seriously consider controlling expenditure. Expert opinion suggests that expenditure on housing benefit is out of control and that
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  the ministerial team do not have a clue about how to rein in that expenditure. They are cracking down on fraud, but not on expenditure. That smacks of double standards.
  Mr. Lilley: The hon. Gentleman suggests that fraud is partly due to the deregulation of rents. Does he propose to introduce rent regulation to control housing benefit expenditure? Is that Labour's policy?
  Mr. McLeish: My mind takes me back to an intervention by the Prime Minister on my right hon. Friend the Leader of the Opposition. There is no suggestion that we will touch rent regulation. It is ridiculous to suggest that that is part of the thrust of Labour's policy. The Government preach the virtues of cutting expenditure, but they have administered an £86.5 billion bonanza without any regard for taxpayers. The Government find it difficult to cope with that central problem.
  As my hon. Friend the Member for Peckham (Ms Harman) said, local councils have told the Government that they need more powers, but they have not been given them. The Select Committee on Social Security proposed a raft of measures, but only now have the Government incorporated a few of them in the Bill. The Audit Commission, in its 1993 report, suggested that more must be done. That view was restated in its 1994 and 1995 updates, and in its report published last week. Unlike the Government, the Audit Commission welcomes the encouraging response from local authorities, but it says that
  "much more remains to be done to put in place the most effective arrangements for preventing and detecting fraud and corruption."
  There is consensus on the views that Labour has pushed this evening.
  In her speech, my hon. Friend outlined the measures that Labour wants to take. I do not want to delay the House by going over them again, but I stress the issue of a landlord offence. The Government are being tested on their commitment to take housing benefit fraud seriously. Every Conservative Member who speaks wants an attack on claimants who defraud, and that is right, but the test for the Government is what they are going to do about landlords. The Bill deals with new offences, so why do we not have a clear and—to use a phrase much vaunted by the Government—unequivocal attempt to define landlord fraud? That does not involve loose change; it is massive fraud—organised gangsterism. What is happening is criminal. I hope that in Committee the Government will lessen their constraints and take seriously the need to hit landlords hard.
  The other issue that I want to deal with is that of uptake and entitlement. I have exchanged correspondence with the Secretary of State for Social Security—my hon. Friend referred to that earlier. I shall set the parameters of that issue. Currently, 1.6 million pensioners claim income support. That is a scandal. To add insult to injury, nearly 1 million other pensioners are poor enough to claim income support but do not. That is modern Britain in 1996. The legacy of 17 years of Toryism is that 25 per cent. of our pensioners live on or below the officially recognised poverty level.
  I shall pick my words carefully. Does that fact not touch the hearts—if they have hearts—of Conservative Members? That is a scandal, and the insult was reinforced

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  today by the Government, who dismissed my hon. Friend's submission that we should consider ways of data matching to improve take-up. We appreciate that if we data matched every Government source—if that were technically possible—it would not provide the answer. A crisis faces Britain's elderly, but the Government refuse to do anything about it. The House will be viewed with disfavour if the Minister does not say that he will want to reconsider the matter in Committee.
  We are not looking for a total, instant solution, but we are looking for a bit of sympathy—a change from the mean-minded approach shown by Conservative Members today. We want the Government to say that 1 million pensioners—10 per cent. of the pensioner population—will have the chance of a better deal. They will have that chance if we use the same processes to detect those who are not receiving benefits to which they are entitled as we use to detect fraud. Ministers should be warned that the issue will not go away; too many people are involved. That is why I think that they should reconsider, following the rather curt responses that have been made to members of all political parties today. Let us proceed with the Committee and reach a consensus on helping people as well as a consensus on detecting fraud.
  Information technology gives us an intermediate opportunity to reinforce welfare benefit take-up campaigns by using such technology within Government, however undeveloped it may be in the DSS at present. I sincerely hope that my overtures will receive a positive response. We would like to assist: 1 million pensioners living on their own simply need help, and I hope that the Government will reconsider.
  We have not touched on the need to prevent fraud, which is as important as detecting it. I made a point earlier about front-line decisions, some of which need to be improved. They are often surrounded by confusion and inefficiency. We talk of managing the waste in the system, because fraud is basically about waste. I hope that Ministers will go away and think more clearly about the measures that they will table in Committee to strengthen the relevant part of the Bill. Prevention and detection should go together, as should the issues of expenditure and fraud. We need a more comprehensive approach to both those issues.
  Parts of the Bill, to which my hon. Friends have referred, give cause for concern. Clause 14 has been mentioned, in connection with the recovery of benefit. A host of submissions have been made by the Disability Alliance and others about that problem. I emphasise the importance of disability living allowance, disability working allowance and attendance allowance, about which there are clearly huge suspicions. In Committee, the Government must ensure that they are not well founded.
  The Government have actually extended the welfare state. We have an "out-of-work benefits culture" and an "in-work welfare culture" which they have developed and intensified—and we now have workfare, which constitutes neither work nor welfare. It seems that, no matter where they are, the Government want to hit people with welfare. The sad aspect is that, while other parties are talking about a more progressive approach, the Government have extended the welfare state, not in terms of a more positive role in regard to the breadth of its
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  activity or links with the labour market, but in terms of the massive number of people who now depend on welfare and the huge attendant cost to the public purse.
  We need to move on. The Committee will give us an opportunity to look positively at the problems that we have identified, and we hope that the Government will reconsider some of their initial attitudes. Let us get down to work: if the Government respond, so will Labour.
  9.38 pm
  The Parliamentary Under-Secretary of State for Social Security (Mr. Oliver Heald): We have had a lively and informed debate, with excellent contributions from my hon. Friends the Members for Westbury (Mr. Faber), for Colchester, North (Mr. Jenkin), for Bristol, North-West (Mr. Stern), for Ribble Valley (Mr. Evans)—I thank my hon. Friend for his kind comments about my visit to Preston—and for Blackpool, North (Mr. Elletson). We also heard thought-provoking speeches from the hon. Members for Birkenhead (Mr. Field), for Rochdale (Ms Lynne) and for Stratford-on-Avon (Mr. Howarth)—and, of course, from those on the Opposition Front Bench.
  I begin by paying tribute to the work of the Select Committee. There is no doubt that the Select Committee has done a marvellous job in considering the evidence and the issues surrounding fraud. Just as the Committee paid tribute to the work of my right hon. Friend the Secretary of State for Social Security, it is only right to return the courtesy.
  The Bill's provisions dealing with disclosure, and with housing benefit fraud particularly, will make a major contribution to cracking down on benefit fraud by individuals, organised gangs and landlords. Picking up on a point that was made towards the end of his speech by the hon. Member for Fife, Central (Mr. McLeish), who I welcome to his new responsibilities and to the debate, clause 11 contains the tough new offence of dishonestly making a representation to obtain benefit.
  The clause applies equally to a landlord as it does to a tenant. What is more, it imposes a new penalty with a maximum of seven years, so this new offence is not one sided, but provides the ammunition, as it were, for the courts to pass the proper sentence in the appropriate case. Landlords are not, therefore, ignored in the Bill—far from it.
  Mr. Frank Field: Did the Government think about introducing a clause that would deal specifically with landlords?
  Mr. Heald: My point is that the clause does that.
  Mr. Field: The Minister has not answered the question.
  Mr. Heald: If the hon. Gentleman wishes to, he can make that point, but the clause does deal with landlords as much as with tenants, and provides a powerful new weapon in the armoury. Just as a landlord who is guilty of conspiracy to defraud can be prosecuted for that, he can be prosecuted under the Theft Act 1968 and under other social security legislation. Those offences provide the battery of weapons that we need.
  All the penalties that we are introducing and the cautionary system provide a tough new regime, apply to landlords and can be used in the fight against landlord

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  fraud, as well as against straightforward tenant and claimant fraud. We should remember that all the informed estimates are that about £150 million of the £1 billion of undetected housing benefit fraud is committed by landlords. It is right to think of that as an important element of fraud, but wrong to go as far as the Labour party in saying that it is going to detect £310 million of fraud because that is twice the amount that there is.
  Disclosure is an important weapon in the battle against benefit fraud because it gives us the potential to check claim information against information held by the Inland Revenue relating to earnings and investments, or against value added tax information from Customs and Excise relating to self-employed people. Those are two sectors where the benefit system is susceptible to fraud and where conventional methods of prevention and detection are not always effective. The use of modern technology under carefully controlled conditions will enable quick and effective checks, without putting genuine claimants through any additional effort.
  The Opposition have raised the question whether it will be possible to expand the disclosure of information provision to enable us to identify pensioners who may have an unclaimed entitlement to benefit, but that shows a misunderstanding of what is administratively possible. Detecting fraud by data matching means comparing, on a selective basis, small areas of information that, when put together, can identify inconsistencies in a benefit claim and can be investigated by a fraud investigator.
  The data matching that the hon. Member for Rochdale suggests involves doing a means test on an individual. That means that we would need to piece together all the information across Government, on all the income and savings of all people, which is a different scale of task. Just to amplify my point to the hon. Lady, we know who the pensioners are and who the people who claim income support are, but just by comparing—
  Ms Harman: We can take into account all housing benefit claims.
  Mr. Heald: The hon. Lady says, and I am willing to accept, that we could take into account housing benefit claims. We could take into account national insurance contributions. Even with all that information, which is on a much greater scale than that which are envisaging in the Bill and which has its own difficulties, we would still have a very long list of individuals who would have to be contacted individually. Many of them may not have wanted to have had a means test conducted behind their back and we would be giving many of them the idea that they were, perhaps, entitled to a benefit when they probably were not. For example, the reason why somebody may not have any Inland Revenue records to show any receipts of income may well be that that person has granny bonds or some other security for which there is no need to make disclosure. That point was made by my hon. Friend the Member for Bristol, North-West.
  Ms Lynne: If the Minister is definitely ruling out such a possibility in the Bill's remit, will he tell the House
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  tonight that he will instigate a take-up campaign so that pensioners who are not getting the income-related benefits to which they are entitled will be able to claim them?
  Mr. Heald: As the hon. Lady will know, the Government do a number of things to make people aware of their entitlements.
  Ms Harman: Like calling them scroungers.
  Mr. Heald: The hon. Lady is calling them scroungers—I would never do that.
  We send out information about entitlement to a large range of bodies. We send advisers out to meet pensioners groups, and so on. The Department spends millions of pounds on telling people about their entitlement. From time to time, we run campaigns with Age Concern, Help the Aged and all the other bodies to make pensioners aware of their entitlement, and we shall be doing that again in January.
  Mrs. Anne Campbell: Is the Minister not aware that the additional information that is needed on the claim for income support is already supplied to local authorities when pensioners apply for council tax benefit and housing benefit? Why on earth is he ruling out a very simple measure, when pension entitlement can be calculated with information that is already on local authority records?
  Mr. Heald: I think that I answered that point. Of course, the other point that can be made on the matter is that the regime is different; the capital rules are different. That would affect the exercise.
  Having raised a number of practical points, I do not think that we should ignore the fact that there are considerable difficulties under the European convention on human rights about the form of data matching that impinges on the privacy of an individual who may not want to be means tested despite the obvious attractions.
  Mr. McLeish: I have two points. First, does the Minister accept that it is totally unacceptable that 1 million pensioners are living below the poverty line? Secondly, will he allow the Committee to pursue further the issue so that the difficulties as well as the opportunities that may be provided can be explored?
  Mr. Heald: As you, Mr. Deputy Speaker, will know, I would never interfere with the role of the Chairman. The scope of the Bill is an issue not for me but others. As I have said, the Department does a great deal to try to make people aware of their entitlement, but it is ultimately up to them whether they claim them.
  Ms Lynne rose—
  Mr. Heald: I will not give way again because I want to say a little more about landlord fraud.
  The new offence that I mentioned is one measure to help in the battle against landlord fraud, but there are others. The power to pass information between local authorities and between a local authority and the Department will make multiple claims—one of the most common frauds involving landlords along with tenants—much more difficult and allow local authorities to share

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  information on suspect landlords. If a local authority wished to have a register of landlords—an idea that I know that the Opposition have pursued—and a neighbouring authority wished to exchange such information, it would be possible.
  The extension of powers of local authority investigators by analogy with Benefits Agency investigators will enable them to enter landlords' business premises and inspect records. If the records are not held at the business, a requirement can be made by the local authority investigator that they should be supplied to him. There is also a new provision to improve the recovery of overpayments of housing benefit from landlords who receive the original payment directly. The new powers to inspect will ensure that local authorities take appropriate action to prevent and detect fraud, including landlord fraud.
  I shall now deal with some of the points raised in the debate. The hon. Member for Peckham (Ms Harman) asked why local authorities do not have powers to refuse direct payments other than in exceptional cases. They are able to refuse direct payments and local authorities have a discretion on direct payment to landlords. It is only in circumstances in which there are substantial arrears that that changes.
  In an intervention, my hon. Friend the Member for Bristol, North-West asked whether the penalty was a fixed 30 per cent. or was variable. The penalty is fixed and there is no variation. The hon. Member for Peckham asked whether article 8 would stand in the way of data matching—although she agreed with it. It is right that the data matching must be necessary to achieve the interest in question. The hon. Lady also raised a point about whether local authorities should automatically provide details of direct payments to landlords to the Inland Revenue. We have consulted the Revenue, which is satisfied with its existing powers.
  My hon. Friend the Member for Westbury asked about the cost and benefit of the benefit fraud hotline. I can confirm that the fraud hotline is showing value for money. It costs £1.5 million pounds a year to run the line and so far it has saved at least £15 million. I am certain that that financial return will be maintained. My hon. Friend also asked whether the benefit-payment card used the chip technology that has recently been cracked. That point was also taken up by the hon. Member for Cambridge (Mrs. Campbell). The answer is no, because the card uses a different technology and the security of the system does not rely solely on the security of the card itself. It is ironic that many pushed us to use the smartcard technology and we resisted for good security reasons. We have been proved to be right about that.
  My hon. Friend the Member for Westbury also asked why the Bill will prevent inspectors from entering residential premises in which a business is being carried on. I have already made the point that the investigator will be able to demand the necessary documents. My hon. Friend also asked whether local authorities could have access to the departmental central index. The Bill will enable such access, but with strict security conditions. He asked whether strict verification would take place before a benefit-payment card was issued. The answer is yes, because the cards will be delivered to the post office and only then to the customer, who has to produce evidence of identity for the card to be activated. Strict conditions will be applied.
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  The hon. Member for Birkenhead asked a number of questions. I have dealt with the question of collusive employers. He also asked about the hotline and what percentage of calls led nowhere. He said that 90 per cent. led nowhere, but that is not correct. Some 80 per cent. of the calls have been referred to investigators and many are still being investigated. We believe that overall it is a worthwhile exercise and we shall produce the figures in due course. I have visited Preston and I have met the staff who are trained.
  Ms Harman: You are not.
  Mr. Heald: I have never claimed to be trained, but the staff are both trained and house-trained. They work to a detailed form, which they have to fill in with the information that is required by the fraud investigators. The form has been carefully constructed by the investigators to ensure that the relevant information is gathered. The investigators say that the scheme is working well and they are satisfied with it.
  Mr. Frank Field rose—
  Mr. Heald: I will not give way because I am short of time. [Interruption.] The hon. Gentleman asks whether the staff are temporary. There are some full-time staff who are not temporary and there are some who are. I am happy to say that they are good at what they do.
  My hon. Friend the Member for Colchester, North raised a number of points and he asked whether the social security database would have online access. In due course, it will and I agree that it will be necessary in the longer term to achieve that objective. We have asked the computer industry for proposals on a common core system. That point was also made by the hon. Member for Cambridge.
  The hon. Member for Rochdale wanted an assurance that the Department would not sell on information received under the data matching process, and I can give her that categorical assurance. We have a long record of holding and handling sensitive information and keeping it confidential. She also asked what safeguards there would be for a battered wife whose husband worked for the Department. I hope that that is not a reflection on the staff of the Department who, by and large, would not welcome that example. Having said that, we expect to process the data at a single site and it will be held and handled in safe and secure conditions. We will take all necessary safeguards to ensure that only where a mismatch is found will staff become aware of the case for further investigation. We will limit the information to those who need it. She should also be aware that it is an offence to disclose information in these circumstances and that it can be considered gross misconduct within the Department.
  My hon. Friend the Member for Bristol, North-West raised a number of points. I do not think that I can respond to them all, but I promise all hon. Members that I will write to them if I do not mention their points. He asked about the prosecution record for benefit fraud, and I can tell him that we have a 98 per cent. success rate where proceedings are brought and we will maintain those high standards. He asked if our data matching system will be able to cope with the new data from the Inland Revenue and other sources, and we are confident that it can.

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  We shall not be using the contractor that he suggested, excellent though it is, because we shall be using BT Sintegra.
  My hon. Friend the Member for Bristol, North-West asked us to ensure that the provisions in the Bill are not applied inappropriately to the right-to-buy provisions, and I can happily tell him that the Bill applies to benefit administration and benefit fraud and does not affect the right to buy. He asked about the Child Support Agency. Fraud allegations made to the CSA are passed on to the Benefits Agency for investigation, and the Bill does not allow us to pass information between the CSA and, for example, the Customs and Excise or the Inland Revenue. There should be no fears on that score. He mentioned mitigating the penalty, but I think that I have dealt with that matter.
  The hon. Member for Stratford-on-Avon raised a number of issues, and talked about the tension between the need to detect and prevent fraud and the individual's right to privacy. We guard jealously the individual's right to privacy, but we believe that it is necessary and in the public interest to be able to match the information. A number of other points were raised which I will answer in correspondence.
  I wish to respond to one or two points made by the hon. Member for Fife, Central on the Government's policy. It is a bit rich for the Labour party—which, after all these years, does not have a single idea on benefit fraud—to criticise the Government. When Labour local authorities were doing nothing, my right hon. Friend the Secretary of State came forward with the tough package of incentives and penalties that has tripled the amount of housing benefit fraud that has been disclosed. The Labour party is tough on the one hand and tender on the other on benefit fraud.
  In June, the hon. Member for Islington, South and Finsbury (Mr. Smith) suggested that we should increase random blanket home visiting of claimants. Yet in August, the hon. Member for Fife, Central criticised our home visits and said that people who were totally innocent could end up being the victims of a visit by the DSS. One definition of a victim is a person suffering harm or death. Was the hon. Member for Islington, South and Finsbury suggesting random blanket suffering for all? Of course he was not.
  In March, the hon. Member for Islington, South and Finsbury told us that the benefit fraud hotline in Reading was innovative and that we should follow it—although, of course, it followed us. Yet in August, the hon. Member for Fife, Central was describing it as a snoopers' charter and talking about a civil liberties problem. Labour told us in 1992 that we should not overestimate the problem of fraud, and yet overstated it itself. Labour said that it would recover £310 million from landlords, despite the best estimate being that there is only £150 million-worth a year. No wonder Labour cannot make up its mind how to vote.
  Question put and agreed to.
  Bill accordingly read a Second time, and committed to a Standing Committee, pursuant to Standing Order No. 61 (Committal of Bills).

  SOCIAL SECURITY ADMINISTRATION (FRAUD) BILL [MONEY]
  Queen's recommendation having been signified—
  Motion made, and Question put forthwith, pursuant to Standing Order No. 50A(1)(a),
  That, for the purposes of any Act resulting from the Social Security Administration (Fraud) Bill, it is expedient to authorise—

  (1) the payment out of money provided by Parliament of—

  (a) any expenditure of a Minister of the Crown or government department incurred in consequence of the Act; and

  (b) any increase attributable to the Act in the sums payable out of money provided by Parliament under any other Act; and

  (2) the payment into the Consolidated Fund of sums received by the Secretary of State in consequence of the Act.—[Mr. Knapman]

  FIREARMS (AMENDMENT) BILL (ALLOCATION OF TIME)
  Ordered,
  That the Order of 18th November be varied by substituting for paragraphs 3 and 4 the following paragraph:—
  'Report and Third Reading

  3A.—(1) The proceedings on consideration and Third Reading shall be completed in one allotted day and shall be brought to a conclusion at midnight on that day.

  (2) Paragraph (1) of Standing Order No. 14 (Exempted business) shall apply to those proceedings.'.—[Mr. Knapman.]

  WELSH GRAND COMMITTEE
  Ordered,
  That the Matter of the implications of the Budget for Wales, being a matter relating exclusively to Wales, be referred to the Welsh Grand Committee for its consideration.—[Mr. Knapman.]

  WELSH GRAND COMMITTEE (SITTINGS)
  Ordered,
  That the Welsh Grand Committee shall meet at Westminster on Wednesday 4th December at half-past Ten o'clock and between Four o'clock and Six o'clock to consider the Matter of the implications of the Budget for Wales.—[Mr. Knapman.]

Former Mine Shafts (Kingswood)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Knapman.]
10 pm
Mr. Roger Berry: I am pleased to have the opportunity to raise a subject of great importance to many of my constituents—the accuracy or inaccuracy of the Coal Authority's records of former mine shafts in Kingswood and Bristol. I am also grateful to the Minister for being here to respond to this important debate.
In a nutshell, the problem is that, in my constituency and throughout the rest of the area that once formed part of the Bristol coalfield, there is a lack of confidence in the accuracy of the Coal Authority's records of disused mine shafts. That lack of confidence is common among local solicitors, estate agents, mortgage lenders and the local authorities—Bristol city council and South Gloucestershire council. It is inevitable that Coal Authority records are incomplete and sometimes unreliable. Everyone appreciates that. After all, mine owners were not required to keep accurate plans of a specified scale until 1911.
The problem in Kingswood and Bristol is far more serious than that, however. There are numerous instances of the Coal Authority's advice on a site differing dramatically from that of a local private company, Bristol Coalmining Archives, which, as its name suggests, has an extensive archive of material relating to the former Bristol coalfield.
As a result, local solicitors do not rely on the Coal Authority when undertaking searches, but instead turn to Bristol Coalmining Archives for a second opinion, and they are doing so in increasing numbers. The company currently receives between 300 and 400 such inquiries from solicitors each and every month—approximately 4,000 a year. That is an astonishingly large figure, given the size of the former Bristol coalfield, and the figure is growing rapidly.
Moreover, the Select Committee on Trade and Industry, on which I am pleased to serve, published a report in July on former mine shafts. One of the unanimous recommendations was for an independent investigation of the Coal Authority's archive of the Bristol area.
My purpose in raising the issue is to show the Minister why I strongly believe that the Government should act on the Select Committee's recommendation and bring to an end the distress and blight brought about by conflicting advice on disused mine shafts in Kingswood and Bristol. Not only are many properties being blighted unnecessarily, but thousands of people each year are being forced to pay for two mining searches when considering buying a new home. As I think everyone would agree, that situation is unacceptable, and needs to be sorted out.
I shall start at what, for me, is the beginning. Soon after the last election, as a new Member of Parliament, I was contacted by Mr. and Mrs. Hann of Woodyleaze drive, Hanham, in my constituency. They told me that, in April 1990, a big hole had appeared in their back garden. A local mining expert, Mr. John Cornwell, the managing director of Bristol Coalmining Archives, said that his records showed it to be a former mine shaft. British Coal, as it then was, said that the hole was not a mine shaft but a well, and denied all responsibility.
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My predecessor as Member of Parliament for
Kingswood, Mr. Rob Hayward, took up the case, and subsequently passed on to me an extremely thick file, which makes it clear that he was most concerned about the fact that, despite strenuous efforts, the matter had not been resolved. I am extremely sorry to say that, more than six years later, John and Jacky Hann still have a hole in their back garden which Bristol Coalmining Archives says is a former mine shaft and which the Coal Authority says is not. As the House can imagine, the matter remaining unresolved for so long has had a devastating effect on their lives and health.
If that were one isolated incident, however tragic, it
would not be sufficient to call into question the general state of the Coal Authority's records on disused mine shafts in Kingswood and Bristol; but it is not an isolated case. A few days after the Hanns first contacted me, I was approached by another constituent, who had had difficulties in selling her flat because a search with British Coal had shown that there was a mine shaft close to her home; a second inquiry by Bristol Coalmining Archives produced a report showing that that was not so.
Similar cases have been referred to me by constituents
ever since. I soon discovered that the local authorities—Bristol city council, Kingswood borough council and Avon county council, as they were at the time—had all expressed concern about the accuracy of British Coal's records in the area, as had local solicitors, estate agents, mortgage lenders and my hon. Friends the Members for Bristol, East (Ms Corston) and for Bristol, South (Ms Primarolo).
Following numerous meetings and discussions early in 1993, on 17 September 1993 the then chief executive of Bristol city council wrote to the principal private secretary at the Department of Trade and Industry:
"There are an increasing number of instances when official coal mining searches prepared by British Coal have contained inaccurate, inadequate or misleading information. The City Clerk tells me that he has seen evidence … to support such allegations and a situation has developed whereby local residents (supported by their legal advisers) are no longer prepared to rely on the accuracy of coal mining searches prepared by British Coal.
The letter continued:
"I am also aware that an approach has been made to the Law Society for a directive to be made to the effect that so far as the Bristol area is concerned solicitors should be permitted to make their search direct to Bristol Coalmining Archives Ltd and there should no longer be a requirement placed upon them to request British Coal to undertake a search."
The letter concluded:
"It is clear that the groundswell of opinion is such that the matter cannot be overlooked and warrants a thorough investigation by a senior officer from your Department."
The letter was passed from the Department of Trade and
Industry to British Coal, which denied that there was any problem.
A little more than a year later, on 24 October 1994, another meeting was called at the council house in Bristol. Attending that meeting were representatives from the three local authorities, British Coal, Bristol Coalmining Archives, the Bristol Law Society and the Law Society.
The minutes of the meeting, which were submitted to
the Select Committee, show that Mrs. Pauline Holland of the Bristol Law Society said:
"local practitioners wanted a 'one stop shop' search with all the relevant information available in one place. Local solicitors were placed in a very difficult position when left to decide which reply (British Coal or Bristol Coalmining Archives) to take note of'.

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The other Bristol Law Society representative present at the meeting, Mr. Ian Dunn, said:
"There had been concern about the accuracy of the British Coal search and many solicitors saw the need to obtain other information locally. Clients were advised to pay for both searches."
As the Minister knows, earlier this year the Select Committee on Trade and Industry decided to conduct an inquiry into the problems caused to home owners by former mine shafts, and our report, entitled, "Former Mineshafts", was published on 17 July. Among other issues, the Committee considered the Coal Authority's records of former mine shafts, and identified a specific problem in the Kingswood and Bristol area.
It is interesting to note the written evidence to the Select Committee submitted by Bristol City council reiterated the problems that had been stated in the 1993 letter from its chief executive. The council stated:
"there have been a number of cases where enquiries of the two organisations"—
British Coal and the Bristol Coalmining Archives—
"have received conflicting answers … there have … been cases where one archive has said that a property is affected and the other has said it is not. There have been suggestions that some of the alleged shafts have been old wells … Concern about this is longstanding and crosses local authority boundaries. Householders. vendors, purchasers, estate agents, solicitors and mortgage lenders are all inconvenienced by the suggestion being made that they should make enquiries of more than one body, and all the uncertainty it produces for them when the answers from different sources are different."
The suggestion that the Coal Authority is wrongly identifying disused wells as disused mine shafts is supported by extensive evidence to the Select Committee submitted by Bristol Coalmining Archives.
The city council's evidence to the Select Committee is echoed by that from other local authorities—South Gloucestershire council and the former Avon county council. South Gloucestershire council lamented the lack of accurate information, and also stated:
"advice from the Coal Authority … is sometimes contrary to information provided from other sources (eg Bristol Coalmining Archives)."
Perhaps even more remarkably, it also stated:
"Advice from the Coal Authority on any particular site has not been consistent over a period of time".
That is the opinion of the local authority—an organisation with a certain reputation in the area for being accurate when it gives evidence.
One might ask what local estate agents have to say about the current state of affairs. They, too, are rather exasperated. The Avon branch of the National Association of Estate Agents is chaired by Mr. Peter Brunt, whose business is in my constituency. He, too, submitted written evidence to the Select Committee, in which he observed:
"Many of my colleagues both in Estate Agency and Solicitors … are aware that the Coal Authority's records are not as accurate as they should be. If a Coal Authority search shows a possible mine in close proximity to a property then often the solicitors acting for the purchaser will ask for a second report from Bristol Coalmining Archives. It is becoming fairly common practice"—
I repeat, "fairly common practice"—
"to purchase both reports and some solicitors … have more reliance on the coal search from Bristol Coalmining Archives than they do from the Coal Authority … In my opinion the best way to resolve
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this unsatisfactory position is to have an independent review of Bristol's records held by the Coal Authority and any inaccuracies are identified and rectified."
How do local solicitors regard the situation? I have already referred to the recorded views of the Bristol Law Society, which has repeatedly expressed the concerns of local solicitors about the current situation. I am well aware of those concerns from my discussions with local solicitors. Given such overwhelming evidence, it is hardly surprising that the Select Committee unanimously recommended that there should be an investigation into the Coal Authority's records in Bristol.
However, in the Government's response to the Select Committee's report, they noted, perfectly reasonably, the skimpy memorandum submitted by the Bristol Law Society that cast doubt on the existence of the problem. The memorandum, penned by Mr. Kirby, included the comment:
"In general practitioners who follow the Law Society's Guidance Notes for Coal Mining Searches do not experience difficulties on behalf of clients."
I find that comment extraordinary. As I have shown, it is contrary to everything that the Bristol Law Society has previously said, and contrary to what everyone else has understood its position to be in recent years.
The Bristol Evening Post is commendably pursuing the matter with the Bristol Law Society spokesman Andrew Gregg. In an article in the paper on 12 November, Mr. Gregg was reported to support the call for an inquiry. Just over a week ago, I had a meeting with Mr. Gregg of the Bristol Law Society, and I thought it likely that a letter would be forthcoming before tonight's debate to clarify the society's position. I regret that it has not been.
There is abundant evidence that local solicitors believe that there is a problem. I have already said that, every year, local solicitors in Kingswood and Bristol make 4,000 inquiries of Bristol Coalmining Archives. Why are local solicitors going to the trouble, not only of undertaking a search with the Coal Authority, as the Law Society requires, but of consulting Bristol Coalmining Archives?
The answer is clear: local solicitors make the inquiries because, along with estate agents, building societies and other mortgage lenders, they believe that the Bristol Coalmining Archives' records are more accurate than the Coal Authority's. Some solicitors have told me that, if the Law Society changed its rules, they would stop using the Coal Authority.
I wish to comment on the scale of the problem—other than in terms of the 4,000 annual inquiries to the private company. I understand from Bristol Coalmining Archives that it has identified more than 100 sites for which the Coal Authority's records show one thing and its records show something completely different. Either the Coal Authority says that there is a disused mine shaft on the site and Bristol Coalmining Archives says that there is not, or vice versa.
I am not talking about the odd discrepancy, but about seriously conflicting advice on a large scale. The sample search of 18 properties referred to in the Bristol Law Society's memorandum—and in the Government's response to the Select Committee—is as much a mystery to me as the rest of the communication. But I should have thought that more than 100 incidents of conflicting records could not be dismissed as of no significance.

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Interestingly, local solicitors and local authorities were not the only people to seek assistance from Bristol Coalmining Archives. In his written evidence to the Select Committee, its managing director reported:
"the British Geological Survey has had occasion to compare the extent of the two archives. As a result it is about to enter into agreement with Bristol Coalmining Archives Ltd for the revision of mining information on the Bristol Geological maps and for co-operation in other projects."
The Minister may know that that agreement has now been signed.
If the Coal Authority's records are adequate. why should the British Geological Survey be seeking the assistance of Bristol Coalmining Archives? I am not a mining engineer: I do not know who is right and who is wrong. I could not tell a mine shaft from a well if I fell down one, but I know that there must be a good reason for solicitors in Kingswood and Bristol to make 4,000 requests every year of Bristol Coalmining Archives, and there must be a good reason why the British Geological Survey has commissioned work on mining records from that same company.
Scarcely anyone with a professional interest in mining records in Kingswood and Bristol—local solicitors, councils, estate agents, the British Geological Survey—does not now use Bristol Coalmining Archives. Therefore, the case for an investigation into the matter is overwhelming, and I would not have spent so much time over the past four years working on the issue were I not convinced that it was clearly in the public interest for it to be sorted out.
I should be delighted if tonight the Minister agreed to the Select Committee's request for an independent investigation, as that would be the right thing to do. I appreciate that he may not be able to do that immediately—he may want to reflect on what I have said this evening—but I urge him to reconsider the matter seriously. I hope that he will agree to meet a delegation of interested parties from Kingswood and Bristol to hear their views at first hand.
One thing is clear: there is a problem—one that is recognised by anyone in the area who knows anything about mining records. The problem will not go away. It needs resolving, and it needs resolving quickly.
10.19 pm
The Minister for Small Business, Industry and Energy (Mr. Richard Page): I congratulate the hon. Member for Kingswood (Mr. Berry) on getting a slot in order to raise this important matter. Although I understand his concerns, I have to say that, if only life was as easy as the hon. Gentleman implies, he and I would be happy men. Life is, however, more complicated than that.
It may be helpful if I give a little factual background. The Coal Authority's database records some 150,000 coal mine shafts and mine entrances, and it is estimated that as many again are unrecorded. There is probably an equal number of entrances that are not connected with coal mining.
Of the coal mine shafts and entrances, the great bulk—over 90 per cent.—date back to the 18th and 19th centuries, when records were a little sparse, as the hon. Gentleman would be the first to agree. Such structures were then relatively narrow, relatively shallow and, in fact, more akin to wells than to the mine shafts of today,
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which are several metres across and hundreds of metres deep. The majority of those shafts give no trouble whatsoever.
To put the issue in proportion, let me point out that the Coal Authority responds to about 120 calls a year relating to mine shafts, and only about 100 relate to coal mine shafts—100 calls in connection with perhaps 300,000 recorded and unrecorded mine shafts and entrances. Of the 20 remaining calls, I am sure that one or two related to some of the stone mines in the Bath area that have given trouble in recent times.
We must be fair and not over-dramatise the problem. Some shaft collapses are really nothing more than a dip in the ground and damage to property is exceptional. The Coal Authority has had only seven cases reported under its surface hazards procedures in which a mine shaft was found to be either partly or wholly under a building; and, in fact, only one building was actually damaged.
The Coal Authority now issues approximately 250,000 mining reports a year. Those give information on past, present and future surface and underground coal mining activities, and outline the geological lines of weakness, subsidence damage claims and working rights. Since 1947, solicitors have been asking for such reports from the National Coal Board, British Coal and now the Coal Authority as part of the process of buying and selling land. Until 1989, whether to do so was left to solicitors' judgment, but, since then, the Law Society has introduced a code of good practice and provided a standard questionnaire.
As the hon. Gentleman knows, the Government impose no requirement on anyone to obtain a mining report on any property that is being bought or sold. The reason solicitors act as they do is to provide a service and to ensure that their clients are given the full facts. In going to more than one source of information, I would suggest that they are simply covering every available option.
It has been suggested that there should be a single provider of mining reports—which would be an attractive proposal, if life were that simple. However, questions arise if that single supplier is not the Coal Authority. If we are to have a different supplier in the Bristol area, we must recognise that other providers might wish to offer a service elsewhere—in fact, there could be competing requests in a single area.
I understand that the questions posed by the Law Society questionnaire and the answers given in the Coal Authority mining report go wider than the topics covered in the report provided by Bristol Coalmining Archives. Would solicitors and their clients be content to have a single report that was narrower in its scope than those that were previously available from the Coal Authority? I rather doubt it.
In practice, any alternative supplier would have to acquire from the Coal Authority data that it did not already have and constantly consult the authority to update its data. As we know, the Coal Authority constantly updates its records, as more information becomes available. As I have said, this is not just a matter of mine plans; we are also concerned with information about subsidence claims. Providing and updating data is a service for which the authority would have to charge to meet its obligation to cover its costs.
The Coal Authority could not just hand over the plans. The authority holds many plans on behalf of the Health and Safety Executive. Because of that health and safety

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aspect, the Coal Authority has arrangements to allow access to plans 24 hours a day, 365 days a year. That is a requirement of the Health and Safety Executive. Any alternative custodian of those plans would need to guarantee a similar arrangement. Would other custodians be prepared to incur that cost?
We also need to consider the level of charge. The Coal Authority's financial duty is simply to recover its costs. Would we therefore need to control the charges imposed by an alternative supplier?
For all those reasons, we believe that the Coal Authority should continue to provide the service throughout the coalfields of Great Britain, whatever additional local service may be available.
Mr. Berry: Will the Minister acknowledge that I am not arguing for an alternative source of information to that of the Coal Authority? I am arguing for an investigation into the well-known fact that the Coal Authority records in the Bristol and Kingswood area are radically different from the records of another organisation. I do not care who has the final records, but surely that needs to be sorted out.
Mr. Page: I shall address that in a moment or two, provided that time is with us.
As I said, the Coal Authority database derives from many thousands of plans, many prepared in the 18th and 19th centuries. Having visited and looked at the records, I know that they were produced on a medium that is now in poor condition and costing an enormous amount of money to restore and bring up to date. If at any time the hon. Gentleman would like to visit the Coal Authority records, I am sure that I will be able to lay on a day trip for him.
The transcription of those plans by British Coal was done by experts, many of whom had detailed local knowledge, and that continues to be the case under the Coal Authority. It is therefore difficult to envisage what could be done to improve significantly the quality of the data on which those plans are provided.
In the context of Bristol, I remind the hon. Gentleman of the evidence given to the Trade and Industry Select Committee by the Bristol Law Society. The hon. Gentleman quoted several discrepancies and differences but, as we know from the Trade and Industry Select Committee:
"Sample searches on 18 properties of each set of records made for the purpose of the investigation showed no relevant discrepancy between each set of records, and no evidence of negligence by either party."
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That is from the Committee on which the hon. Gentleman serves, so it must be right—
Mr. Berry rose—
Mr. Page: With respect to the hon. Gentleman, time is not with us.
Having said that, the Coal Authority recognises that its database is incomplete, and wishes to add to it.
The authority is also drawing the Committee's report to the attention of other bodies that are known to hold relevant information, urging enhanced co-operation. That should be the right way to proceed.
In the case of Bristol Coalmining Archives, we agree with the Trade and Industry Select Committee that there is no basis on which a company or other private sector body can, or should, be compelled to make its archives available to the authority, but perhaps it and the Coal Authority will be at least able, to a degree, to offer a complementary, not competing, service. I have asked the Bristol Coalmining Archives again to consider making available information to the authority, and I look forward to its response.
This is a specific local matter, and the hon. Gentleman said in effect that the Coal Authority should have the responsibility for precisely locating and determining the condition of the mine shafts within a distance a building. He in effect asked for the records and so on to be checked and brought up to date. The Coal Authority estimates that the costs attached to such an exercise would be between £3,000 and £4,000 per unit just to investigate each site, and perhaps another £6,000 to £8,000 per unit for a site where treatment was judged to be necessary.
In 1995, the Coal Authority prepared about 6,000 mining searches that include reference to disused mine shafts. We believe that, if the shafts were treated by the authority at the request of the property owners, the number of searches would increase substantially. On that basis, the cost of simply locating shafts would run to many tens of millions of pounds, and would substantially increase if treatment were necessary.
Mr. Berry: Will the Minister give way?
Mr. Page: With respect to the hon. Gentleman, I have only 30 seconds to go.
Whatever our differences, it is clear that these are important issues. They affect many home owners in Bristol and Kingswood and other areas covered by coal mining in the past, which make use of the services provided by the Coal Authority. The data are not perfect, but that is due to—
The motion having been made at Ten o'clock, and the debate having continued for half an hour, MR. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
Adjourned at half-past Ten o'clock.