Bain Report

HC Deb 16 December 2002 vol 396 cc552-67 4.24 pm

The Deputy Prime Minister(Mr. John Prescott)

With permission, Mr. Speaker, I should like to make a statement on the future of the fire service.

This morning Sir George Bain published his final report, "Reducing Risk, Saving Lives". I am sure that the House will want to join me in thanking Sir George and his team—Sir Michael Lyons and Sir Tony Young—for an excellent piece of work and for delivering it on time, as promised. The House will recall that the review's terms of reference were to make recommendations on the future organisation and management of the fire service, and in that context, to look at pay and conditions.

The report recalls that there have been seven or eight major reviews of the fire service going back more than 20 years. As Sir George acknowledges, many of the recommendations contained in those reviews are repeated in the Bain report. However, the report concludes that what will really make the difference this time is putting those reforms into practice. That is a challenge which must not be evaded again. The report describes a service where legislation is out of date, management practice is out of date, and the rules and regulations that govern the overall framework and the day-to-day work of the fire service are old-fashioned and restrictive. It says that despite the best efforts of the firefighters, the fact is that too many people in this country die in fires and the number of fires is currently increasing each year". The report states that the UK has not been as successful as other countries in fire prevention. It concludes that what is needed now is a new system where there is far greater emphasis on preventing fires, and which ensures that the deployment of people and equipment means that they are in the right place at the right time to protect lives.

The report's first and most fundamental recommendation is to move to a system of targeted fire cover that is based on a careful, professional assessment of the real risk of incidents in each local area. At present, fire cover is based on rigid targets for a set number of appliances to attend an incident within a set time. Those targets are defined by property characteristics, rather than the risk to life. The targets apply day and night, during the week and at weekends, irrespective of the predictable daily changes to the level of incidents actually taking place. In the most extreme example, the targets lead to the situation in the City of London where there are the same number of firefighters on duty at night, when there are just 5,000 overnight residents, as during the day, when there are 500,000 people working in the area. That is not the most effective deployment of resources. But above all, as the Bain report concludes: The existing framework of risk categorisation does not reflect known risk factors. It directs resources away from areas and population groups at most risk. Secondly, the report makes recommendations on better collaborative working. At present, there are 47 fire authorities in England. They rarely work in partnership. Better collaboration between fire authorities, and between fire authorities and other emergency services, is common sense and would be more efficient. In Wales, for example, bureaucracy has been cut by reducing the number of brigades from eight to three, with no reduction in the number of fire stations or fire engines.

Thirdly, the report makes recommendations on working practices, where the fire service has fallen well behind other public services. This includes dealing with the fact that only 1.5 per cent. of firefighters are drawn from the ethnic minorities, only 1.7 per cent. of firefighters are women, and only 2 per cent. of firefighters are graduates. The report concludes that urgent action is required to tackle these problems.

In addition to these important recommendations for the fire authorities and the fire service, there is a raft of equally important recommendations for the Government. The Bain report recommends the repeal of section 19 of the Fire Services Act 1947. Section 19 means that any reduction in the number of fire appliances or firefighting posts, or closure of any fire station, requires the Secretary of State's consent. That situation places detailed control of the fire service in Whitehall and makes modernisation on the ground far more difficult.

The report recommends primary and secondary legislation to modernise the fire service institutions; to deal with the difficulties arising from the discipline regulations, and the appointment and promotion regulations; and to bring fire authorities' statutory duties in line with a modernised fire service. The report also makes recommendations to improve the inspection and delivery of services, and to establish a new central organisation to drive forward the process of modernisation.

Many of the report's recommendations to the Government will require detailed consideration, but we have been looking at these issues for some time and we have given further detailed consideration since the publication of the interim Bain position paper on 11 November. Today, with the publication of the final Bain report, I can set out the steps that the Government will take to put into effect the Bain recommendations.

First, the Government accept the recommendation to repeal section 19 of the 1947 Act and we will do so at the earliest opportunity, as requested. Secondly, we accept in principle the report's recommendations for legislation to modernise the fire service, to improve inspection and delivery of services and to set up a new central body to drive forward modernisation. Thirdly, I am committing the Government to produce a White Paper on the fire service in the spring in order to fulfil our part of the programme of modernisation. The White Paper will set out in detail the legislative and other changes required.

That is a clear programme of reform that will be taken forward immediately and will sustain the drive to modernise the framework in which the fire service operates. My guiding principle will be to transform the fire service into a modern emergency fire and rescue service focused on the safety of people and communities. That is what modernisation is about. Some of it will save money, but some of it will cost money, including, for example, training in basic life support skills and providing life-saving equipment for firefighters. The primary objective will be to improve the safety of the public and create a fire service that can deliver the highest standards.

The modernisation of the fire service forms part of the Government's broader agenda to reform, modernise and invest in Britain's public services. We must not lose sight of the fact that the fire service is a local authority service that is paid for out of local authority budgets. Schools, refuse collection and other local authority services are subject to review and audit through the new system of comprehensive performance assessments. The Bain report recommends further discussion on the introduction of a similar system for fire authorities that would ensure a comprehensive approach to audit for the milestones that it sets out.

With permission, I shall now turn to Sir George Bain's recommendations on pay and conditions. In May, the Fire Brigades Union tabled a claim for a 40 per cent. increase in firefighters' pay and a 50 per cent. increase in pay for control room staff. That remains its position today. That has to be seen against the background of the recent local authority pay award of 7.8 per cent. over two years and the 8 per cent. over two years accepted by the Transport and General Workers Union leadership for airport firefighters.

The Bain report commissioned two studies to compare pay for fire service roles with pay for jobs of similar weight elsewhere in the economy. The report concludes in paragraph 8.19 that there is no case for significant increases in pay based on the existing pay system. However, it calls for a new reward structure that is fit for a modernised fire service, following on from reforms. The Government's response to the FBU's claim has been guided by two clear principles: first, our hard-won economic stability should not be put at risk; and secondly, any pay award must be affordable within existing public expenditure provision. The Bain report's recommendations comply with those two principles and give a fair deal to the firefighters and the public who pay for them.

In line with the Bain review's interim position paper, the final report proposes an 11.3 per cent. pay increase over two years, subject to the implementation of the common-sense reforms that it sets out. The report does not rule out further pay increases in future, but as with the 11.3 per cent. increase, any increases would be subject to the implementation of the modernisation programme set out in the report.

The package proposed by Sir George could mean that an ordinary firefighter could earn around £23,900 a year by November 2003; that a leading firefighter could earn up to £26,700 a year; and that a leading firefighter in London could earn up to £29,300 a year by the same time. The Bain report makes it clear that a two-year pay deal of that order would not be self-financing over two years, but that if modernisation is fully implemented, it could be self-financing over a three-year period.

The local government employers have made it plain to me that they will find it difficult to fund any up-front investment to pay for future modernisation. In keeping with the proposals set out in the Bain report, the Government accept that it may be necessary to provide a small amount of transitional funding over the next two years in order to make it possible for a three-year self-financing deal to be agreed. That funding would be within the existing departmental expenditure limits and would be subject to a satisfactory pay and modernisation agreement and adequate provision for implementing and auditing the modernisation process.

The new pay and career structure proposed in the Bain report will open up new opportunities for firefighters at all levels to develop their skills and increase their income. The report's modernisation agenda will provide a better, safer service to the public. Some brigades, such as the Devon and Mid and West Wales brigades, already carry defibrillators. Why should not others do so? In Warwickshire, ambulance and fire control room staff already share the same building. Why should not other brigades do the same? In some areas, local arrangements are in place for part-time and full-time firefighters to work together. Why should that not be more widespread? It does not mean compulsory redundancies. It does not mean tearing up the shift system. But it does mean a more efficient use of resources, more flexible terms and conditions for firefighters, and tackling the current inadequacies of management. It also means enabling better collaboration to take place between individual fire brigades and the Fire Service and other public services. Exactly how that will be achieved is a matter for negotiation between the employers and the FBU.

The FBU and the local government employers are now engaged in exploratory talks with ACAS. I am pleased that, in the light of those ongoing talks, the FBU has called off the eight-day strike that was scheduled to start today, but I regret the FBU's decision to call further strikes for the new year, which can only cause disruption and put people's lives at risk. The Government believe that the ACAS discussions should take the recommendations and proposals in the Bain report fully into account, as well as the principles set out in my letter to Sir Jeremy Beecham on 28 November. That will mean some tough talking; but further strikes will achieve nothing.

Throughout this dispute, I have urged the FBU to talk, not walk. I recognise that the union has set its face against the Bain changes, but change is on its way, and the FBU cannot set its face against that. It is now time for it to start talking seriously.

The Bain report says With clear vision, commitment and leadership, the programme of reform is achievable. The prizes are considerable, including a better service for the public and a more rewarding career for the men and women in the Service. Most of all, the package of reforms should save lives. The report is a challenge to all of us—the Government, the fire authorities and fire service personnel—but it is a challenge that the Government are determined to meet. The report provides a fair deal for the firefighters, a fair deal for other workers and a fair deal for the economy. Above all, it will provide a better service for the people of this country. I commend it to the House.

David Davis (Haltemprice and Howden)

I thank the Deputy Prime Minister for his statement, and for giving me notice of it. I thank him particularly for making the Bain report available to the House well in advance. There is much to welcome in the report, and I join the right hon. Gentleman in congratulating the members of the review body. Subject, of course, to proper scrutiny in the House, we will do what we can to expedite the primary legislation that he mentioned.

An 11 per cent. rise in firefighters' pay over two years, coupled with radical modernisation of their working practices, is the main proposal in the Bain report. Will the Deputy Prime Minister say in more detail how he and the employers intend to pay for such a wage increase? He talked of a small amount of transitional funding, but back in November the Prime Minister insisted that any pay rise of more than 4 per cent. must be self-financing. Is that still the case?

Paragraph 8.22.ii of the report says We recommend that the paybill should increase from November 2003 by 7 per cent. It is notable that Bain uses the word "paybill", by which we must assume he means total pay-related costs. That implies that little or no savings will be made by November 2003. Is my understanding correct? If so, this indicates a transitional cost of more than £60 million.

The Deputy Prime Minister said last time that the primary source of funding for a pay deal was likely to be manpower reduction based on the retirement of some 20 per cent. of firefighters in the next few years. He said, I think, that that amounted to 10,000 jobs. Unless early retirement is involved—which would cost money rather than releasing it—it will take some time for the manpower reduction to happen.

Professor Bain seems to assume that the arrangement will be introduced after 2003. That means a gap between any pay settlement and the work pattern changes needed to fund it. I understand that the professor largely confirmed that on the radio today. Transitional funding is, as the Deputy Prime Minister has effectively admitted, crucial to concluding the negotiation. The Chancellor, who is present, has said that absolutely no money will be available for the deal; the Prime Minister has said "nothing over 4 per cent."; the Deputy Prime Minister has been more conciliatory, saying "We are quite prepared to make an exceptional case". Now, he is set to provide a small amount of transitional funding. After waiting three months for the report, will he tell us how much the amount will be?

The report makes it clear that the fire service must take a radically different approach to ensure that fewer people die as a result of fire. The Deputy Prime Minister properly talked about that at some length. We all know the importance of the job that firefighters undertake, and we congratulate them on doing it. However, the report states that the overall strategic approach concentrates on firefighting, not on fire prevention, and it argues that that strategy should be reversed to concentrate on prevention. Indeed, the report is subtitled, "Reducing Risk, Saving Lives". In the light of that, will the Government, when assessing any changes in work practices in the settlement, try to achieve an improvement in cover, safety and service levels? Will they make public the improved safety levels that they seek?

Although it is difficult to make comparisons, other European countries with a similar climate and culture—the Netherlands, Germany, France, Switzerland and Austria—have much lower death rates than the United Kingdom. If we achieved the same rates as the Swiss or the Dutch, we would save about 300 lives a year. The report shows that New Zealand, which had the same level of fatalities as us four years ago, has halved the death rate from fires. Again, that is equivalent to 300 lives a year in the UK.

Although hon. Members would understand the Deputy Prime Minister's discomfort in setting himself another five-year target, will he use the opportunity that the reorganisation of the fire service provides to commit the Government to saving 300 lives a year or an equivalent target?

The scope for cost savings in some fire brigades is much greater than in others, nevertheless, all brigades will have to meet the costs of the new pay structure. How will the Government equalise that disparity so that they do not penalise previously efficient fire brigades, especially those in rural areas with retained firefighters? Does the Deputy Prime Minister agree that the scope for savings in rural areas that use retained firefighters is relatively small, and that the price of Bain should not be the closure of fire stations in rural areas?

In his interim report, Bain said that clearer national leadership must complement negotiation. One of the recurrent problems that worsened the dispute was the failure of communication between the Deputy Prime Minister's Office and the employers. Will the Deputy Prime Minister ensure that his office takes direct control of the negotiations so that the Government may exercise a veto over the financing of any deal and the acceptability of changes in work practices?

The report clearly states that the Government rather than the Bain review must decide whether to restrict the right to strike for such an important public service. Has the Deputy Prime Minister held any talks about that? What is his opinion and that of Downing street on the matter?

We have heard much in the past couple of weeks about talks at ACAS. We understand that no new offer is currently on the table, and the Bain report was not published until today. No hon. Members want any more fire strikes. Will the Deputy Prime Minister spell out the progress of the negotiations at ACAS and his expectations for a deal in the near future?

I hope that the publication of the Bain report means that the continuing talks can be conducted expeditiously. I also hope that the Deputy Prime Minister can get a grip on matters, take personal control of the negotiations and not lose an hour in pursuing a financially responsible outcome to the dispute.

What is the timetable for the negotiations in the next few critical weeks? The Bain report will be effected, the dispute ended and true reforms that reduce risk and save lives achieved only if the Deputy Prime Minister takes a grip on matters.

The Deputy Prime Minister

I am grateful for the comments of support, such as they were, at the beginning of the contribution of the right hon. Member for Haltemprice and Howden (David Davis). As for taking a grip, I remind him that Lord Belstead was the Home Office Minister in 1980 who made the same sort of recommendations to the Home Office review as those of the Bain report. The Tory Government did not take much of a grip to implement their review. Fifteen years later, in 1995, the Audit Commission report made the same points and again the Government failed to act. I shall therefore take no lectures from a Tory Member of Parliament when, in 18 years, the Tory Administration failed to do anything about the matter.

We are now trying to do what Sir George Bain is asking us to do, which is to make the commitment to implement, rather than making promises and doing nothing about them. I have already mentioned some important changes in regard to accepting the repeal of section 19 of the Fire Services Act 1947. Everybody knows that, for negotiations to take place, we have to make changes to some of the legislative requirements, and I have immediately given that commitment.

Many of the right hon. Gentleman's questions will be answered in our White Paper, but I shall address some of the points that he has raised. I have some sympathy with his point about the confusion over the figures, because I face some of that confusion myself. The problem here is that the financial year relating to the costs and savings that have been referred to runs from April to April, whereas the pay negotiations cover a period from November to November, part of which would therefore be in one financial year and part in another. I can send the right hon. Gentleman a more detailed statement of those figures, if he likes. The statement makes it clear, however, that the net cost savings mean that the proposed programme could fund itself over three years but not over two, in terms of the extra costs required, and in relation to the modernisation and the savings that can be made. That could be done in three years, but it is right to say that the recommended deal could not fund itself over a two-year period. There is no doubt about that, and I have made it clear to the employers.

It is not my intention to take over the negotiations. We are doing exactly what every other Government have done; they have pointed out what their public pay policy is. That policy applies to everyone in all the local authority sectors, as well as to all other public sector workers. In these circumstances, no extra payments over and above those that are catered for in the public pay policy—or indeed, the 4 per cent. that has been granted—will be paid without modernisation. The employers have to show me—I believe that they have already made a statement this morning—that they intend, in view of the Bain recommendations, to produce a robust business report, which will be given to us, detailing how they might achieve this. That is the best way of dealing with this issue. The employers can now take into account what Bain has said.

The ACAS discussions are welcome because, although one party has refused to co-operate on Bain, those discussions have brought the parties together to listen to the case and discuss its implications. If ACAS can provide us with an opportunity in which the parties are prepared to talk, I do not mind if the agenda for change is achieved under ACAS or Bain, so long as the same principles apply. As I said in my statement, I wish ACAS well in its endeavours to get people to agree to both the modernisation and the increase in pay that will be justified by the changes. Let me also make it clear that the moneys will not come from the reserves or from the Chancellor. I have been very clear that this is my responsibility; these are the moneys that I have within my Department, so anything that needs to be found will have to come from my budget and not from the Chancellor or from extra money from the reserves. That has always been clear, and I am glad to be able to confirm that.

I have already said that it is not my job to get involved in negotiating deal upon deal. If Governments attempted to negotiate pay agreements in every sector, it would create a highly centralised arrangement. In the main, most Governments have liked to leave the negotiations on local services to local people, and that has been the general principle that we have adopted. The right hon. Gentleman's suggestion comes from an Opposition who are constantly talking about giving power down to the local areas, rather than centralising it. So be it. This dispute illustrates their constant conflict of judgment in such matters.

On the White Paper, mention has been made of comparisons with other firefighting facilities—in New Zealand, for example—and the right hon. Gentleman mentioned the Dutch and Swiss services. The inquiry has pointed out that there are differences, and that obviously has to be taken into account. The fire services that the right hon. Gentleman mentioned have shift systems. I want to make it clear that nothing in our proposals would abolish the shift system, or some of the other practices that have gone with it, in relation to second jobs, for example. Those conditions apply in most of the fire services throughout the world, but let me make it clear that we need some changes: changes are necessary and we intend to embark on them. The fire authorities in the different countries to which the right hon. Gentleman referred have modernised and changed. They accept overtime and also do some of the things that we have recommended. I do not think that it is too much to ask that the British firefighting service should face up to the same challenge, which we believe will provide a better service.

Mr. Harry Barnes (North-East Derbyshire)

What time frame is attached to the Fire Brigades Union's demand for 40 per cent? We heard the Opposition talking about five-year targets. It strikes me that it would be possible to engage in a long-term deal that moved the figure, perhaps not to 40 per cent., but to one that would satisfy the FBU, especially if the discussions took place around Bain, because a lot of complex matters have been put before us.

The Deputy Prime Minister

My hon. Friend is quite right to say that there are many complex issues here, but I must say that the factual answer to his question is that the FBU wanted the 40 per cent. to be paid in one year, and no strings. That was totally unacceptable, although as I understand it that remains the claim before us. If there is an alternative, I hope that the FBU will take account of Bain. It can improve its wage scales, but that will happen through the negotiations with the local authorities.

Mr. Edward Davey (Kingston and Surbiton)

I thank the Deputy Prime Minister for his statement and join him in thanking Professor Sir George Bain and his colleagues for the excellent work in the report.

The Deputy Prime Minister is right to regret the fact that the FBU leadership appears to have set its face against change and appears to be planning to go ahead with strikes in the new year, but does he agree that the FBU's dismissive response to the publication of Bain today is as depressing as it is predictable? Does he also recognise that Bain's review is as challenging to the Government and fire authorities as it is to the FBU?

Specifically on funding the pay proposals, the Deputy Prime Minister says that he will provide a small amount of transitional funding. Will he say more about what figure he has in mind? Is it the £29 million that Bain identifies on page 119 in table 12.1 as the gap between costs and savings over the first three years or does the Deputy Prime Minister have another figure in mind? If he is prepared to provide about £29 million, will he tell the House exactly how and in what form he intends to supply that money? In particular, will he ensure that fire authorities that have already reaped cost savings are not penalised just because they have completed modernisation? Does he not agree that it would be wrong to burden modernising fire authorities and their taxpayers with all the extra costs when they have fewer opportunities to reap efficiencies? Will he therefore ensure that extra central Government cash is carefully distributed and targeted to reward the leaders of modernisation?

Does the Deputy Prime Minister accept that Bain is good news for retained firefighters, just as it should be? Does he agree that one of the most welcome proposals in Bain is to give proper advocacy and representation to the Retained Firefighters Union, which, up to now, has been pushed out by the FBU? Does he agree that, if there is a weakness in the Bain review, it is the failure to recommend an even better pay deal for retained firefighters, as there is a serious 20 per cent. plus vacancy rate for retained positions?

Will the Deputy Prime Minister make it clear to those whose job it is to complete the negotiations that they should ensure that the retained firefighters are not betrayed simply because they have not been represented at the table and have been prepared to work and modernise?

Will the Deputy Prime Minister tell the House whether he disagrees with any of Bain's recommendations? Does he support, like us, the proposals to regionalise fire authorities and to back local pay top-ups? On Bain's observations on central Government's emergency planning role, does he accept Bain's statement that further substantial funds will be required and when can we expect an announcement on that?

Finally, what assurance can the Deputy Prime Minister give the House that this latest fire service review will be implemented?

The Deputy Prime Minister

If I may, I will take the hon. Gentleman's last question first. I thank him for his support, but let me make it clear that I do not want anybody to be under any misapprehension whatever—I intend to see the report implemented. It is a report to take into account in the negotiations.

The Bain report is not specific about every part of this deal; it says that its function is not to settle a dispute, but to give some guidance, an up-to-date position and recommendations on how modernisation and pay can be brought together. We fully accept that principle. I am sad that the FBU has said that the Bain report is irrelevant. I do not think it is; it is very relevant to the discussion.

As the FBU has made its position clear and as it is now in discussions at ACAS, it would be useful if it took into account, as the employers will surely point out to it, how modernisation is connected to pay. That, again, depends very much on how much money the Government are prepared to give. The hon. Gentleman referred to the table in the report, which shows that the deal can pay for itself, but in three years. Money can be gained in the third year. Therefore, a judgment would have to be made as to the transitional funds, but let me be absolutely clear: there will be no funds available at all if nobody undertakes any modernisation.

This is not a deal where people go ahead, as has happened every time in the past, even under the previous Administration, without doing anything about the recommendations. The FBU has to recognise that, in these circumstances, modernisation is connected to extra payments. That connection is relevant to the Government and relevant to everyone else. I hope that the fire brigade takes that on board. It is an important part of the deal, if the fire brigade is prepared to negotiate on those terms.

The Bain report makes it clear that a lot more should be done to give part-time or retained workers proper parity of pay and also, perhaps, that there should be a recognition of that when considering the pension fund. Bain makes special recommendations on that, which we will have to take on board, and we will give our responses in the White Paper.

Of course, that would mean having mixed crews, which was another recommendation, but the FBU has always set its face against it. I am told that it is against the idea because it offends against its overtime ban. The ban creates real problems in itself. It is there to prevent people from taking extra resources or gaining extra payment, whereas firefighters elsewhere in the world can earn overtime. The FBU is against second jobs, although a lot of its members have them. I find it odd that it denies firemen the opportunity to do a second job as a part-time fire worker. After all, that is what they are trained for. It is odd that a firefighter can have a second job as a taxi driver but cannot help to provide a decent fire service by working overtime. It is precisely such absurdities that we have to deal with.

Mr. John McFall (Dumbarton)

Will my right hon. Friend join me in condemning the personal denigration of George Bain by the FBU? He is a committed public servant with whom I have worked, and a man of the utmost integrity. Will my right hon. Friend develop initiatives to engage the ordinary, decent firemen on the ground, so that the much-needed change to the fire service can be implemented, and we can help to find the £7 billion that it costs to save lives today—and save lives in the process, which we have not been too good at to date?

The Deputy Prime Minister

I agree strongly about the denigration of George Bain by the FBU, which has been quite powerful. It is totally unacceptable. He is a public servant who carried out the inquiry with great commitment. The denigration is not new—it has gone on constantly, and been directed not only at Sir George but at other members of his committee. I think that most of us in the House would agree that that is unacceptable.

My hon. Friend talks about persuading the decent firemen. I do not differentiate between decent and non-decent firemen—and I am sure that he does not either. All the firefighters are trying to do a job, and the union is trying, in many cases, to reflect its members views, but I hope that firefighters who are following our discussions and reading about what is going on will get involved, read the Bain report and come to a judgment on whether we need a better balance in the fire service, concentrating more on prevention rather than intervention. Sir George has done an excellent job in giving us the properly recorded argument on which to base the debate. Calling that irrelevant is not the way to get agreement, and I hope that the rest of the firemen will take that into account and start negotiations.

Mr. Francis Maude (Horsham)

The Bain report contains some sensible recommendations, and I hope that they will be implemented. Does the Deputy Prime Minister agree, however, that it fails to tackle the principle archaism that cries out for reform: the quaint idea that there is a single model of providing a fire service that is equally applicable in every part of the country, and the equally outdated notion that a single rate of pay is appropriate everywhere? If he really wants to be radical and to achieve modernisation, why does not he look for a way of seriously decentralising, so that local fire authorities can negotiate pay directly with their local employees, and get rid of the wholly outdated notion of a national pay structure?

The Deputy Prime Minister

When the right hon. Gentleman reads the Bain report in closer detail, he will see that it does talk of the need to have a decentralised service. Indeed, it goes further and says that in the fourth strand of change consideration should be given to the concept of regionalism. On different rates of pay, or different services in rural or urban areas, clearly one framework does not suit all. Indeed, Bain says that there could be differences in those different circumstances. I think that he is advocating not different wages in different places, but differences in allowances and agreements to reflect the differing demands. He certainly takes into account the high number of applications for jobs in the fire service.

John McDonnell (Hayes and Harlington)

If Bain is implemented, what will be the estimated total number of firefighter posts in 2005–06, and what is the estimated cost of introducing the recommended reforms to the financial arrangements for the pension fund?

The Deputy Prime Minister

In all these cases, everything depends on the state of negotiations between the employers and the employees. On jobs, as Bain has constantly and rightly pointed out, there is no need for compulsory redundancies. Many mischievous statements have been made in this House, but it is quite wrong to suggest that the result will be a great deal of unemployment.

On costs, again, the issue is the negotiations between the employers and the employees. As the table to which we have been referring shows, what matters is just how much modernisation the Fire Brigades Union is prepared to undertake. I simply say to the FBU that it should get involved in those negotiations. Perhaps my hon. Friend has received a copy of the recent paper from the FBU, which puts forward some of its views on these matters. It deals with very serious issues, and I hope that Members will read it. It is a pity that it did not give that evidence to the Bain inquiry, because it contains some very good arguments. I hope that it will give that information to ACAS, so that we can take it into account. However, at the end of the day the FBU must recognise that a connection will be made between modernisation and pay.

On the likely cost of pensions, again, that depends on exactly what happens and how many people take early retirement. As Bain points out, the cost of the pension system is leading to difficulties. If that system is to be extended to part-time fireworkers—that is one recommendation—a serious study needs to be undertaken. In 1995, the Audit Commission recommended that the true costs of the pension fund should be reassessed. We cannot make that estimate at the moment, but my hon. Friend is right to point out that such a survey will have to be undertaken. Work is under way in that regard.

Sir Patrick Cormack (South Staffordshire)

I wish the right hon. Gentleman success in implementing these reforms, but does he agree that any truly modern fire service should be unable to hold the nation to ransom, and would have a no-strike, binding arbitration agreement as part of such a settlement?

The Deputy Prime Minister

I think that this House would want industrial peace in all areas, and for matters to be settled by negotiation to the satisfaction of all parties. That is something that we would all strive to achieve. We have received some criticism for perhaps not being as tough as the Opposition would like, but I should point out that, of the 36 days of strikes that were planned, only 12 have taken place. We must wait and see what happens, but if we had rushed in by using legislation and taking the sort of action that is being talked about, we would have inflamed the situation, difficulties would have arisen and I doubt whether we would have reached the position that we have reached today. We have to make a balanced judgment about the use of legislation and getting the best out of negotiations; we have given our best judgment, and so far that has proved reasonably successful.

Mr. Russell Brown (Dumfries)

My right hon. Friend will be aware that the Bain recommendations before the House today are not news to firefighters. From day one, they have regarded Bain as delivering nothing more than a long-standing firemaster's wish agenda. How optimistic, confident or otherwise is he that he will get the FBU to sit down and look at these proposals?

The Deputy Prime Minister

Bain's proposals constitute his independent judgment, having looked at the evidence over a number of years, of what he thinks is the best way to provide a modernised fire service. They are to the advantage of everyone—to the fireworkers, to the firefighters and, indeed, to the country at large—and they equate to the principles that we laid down. The proposals constitute a very important step towards trying to achieve change, but as my hon. Friend rightly points out, they are not new. Bain scoured the many directly relevant reports—there are some eight or 10—and pointed out that, although they rightly praise the FBU for the provision of a good service, they make the common claim that modernisation is still necessary because certain restrictions prevent the provision of a better service. That is the judgment that we use, and Bain makes an important contribution to it.

Hywel Williams (Caernarfon)

Does the Deputy Prime Minister accept that specific issues arise in rural areas—particularly in Scotland and in Wales—and that there is little scope to renegotiate pay and conditions in those areas? Does he also accept that, as a result of the report, we still face strikes in the new year, at a time when there is real concern about the coverage provided by the green goddesses in those areas?

The Deputy Prime Minister

There is a distinct difference, which has already been recognised in the provision of fire services in rural and urban areas, and the targets reflect that. However, we recognise that in the main, particularly in the rural areas, cover is mainly carried out by part-time, not full-time workers, who believe it unjust that they do not get paid the same rate as full-time firefighters. The Bain report has said that that needs to be changed and that changes will also need to be made to the pension funds to reflect that. The Government will consider those recommendations and give their response in the White Paper to be published in the spring.

The union has made it clear that there will be another dispute. I am glad that it is a number of weeks away because it allows the armed forces to have a break, particularly during the festive season. The legal advice given to me is that it is not necessary to maintain the strike envelope; presumably it is there to add to the pressure. We are constantly under pressure, and those that apply it should bear it in mind that it is our intention to carry out modernisation; we will not avoid it as has happened in the past. We are committed to making the change.

Jonathan Shaw (Chatham and Aylesford)

May I welcome the statement and my right hon. Friend's comments about transitional funding? Does he agree that there are varying practices up and down the country and that many brigades have implemented changes such as community fire safety? The Kent brigade has been in the vanguard of reducing the number of deaths and house fires. To assist with the negotiations, can I ask for clarification, because some of the language used has been misunderstood by FBU members? [Interruption.] This is a question. On paramedical training, for example, some people have asked me whether the Government believe that fire brigades should undertake ambulance training for four years or is my right hon. Friend talking more about defibrillators? I think that—

Mr. Deputy Speaker (Sir Michael Lord)

Order. I think that that will do.

The Deputy Prime Minister

I am aware of the great improvements to the Kent fire brigade from talking to the leader of Kent's Tory authority, Sandy Bruce-Lockhart. He gave me some examples of co-operation between members and fire officers that has reduced the number of deaths and accidents quite considerably in the past three years. I would not want to give the House the impression that improvements are not being made to the system—clearly there are, with the co-operation of all parties. It shows how much can be achieved if people are prepared to do that, although it is a pity that it usually happens within the local brigade area, not nationally. Our point is that we need to raise national standards.

On the provision of defibrillators, that is a very important point. It takes five or six years to train people to become paramedics and it is an insult not to recognise their true skills. However, it is silly that we can have defibrillators in some areas but not in others. As I understand it, they are supposed to be there only to assist the firefighters themselves. It is nonsense that such a facility is not available to all areas of the community at all times. I know that the fire service finds this controversial, but I saw a study that said that if defibrillators were available and approved for the general public, the response time of the fire service could be increased so that it was better than that of the ambulance service, which is under pressure. If we had the same rate of response at the fire brigade level, it could save many thousands of lives. That is the sort of modernising proposal that will cost us money, but it is for the benefit of the community and I think that we should do it.

Mr. Desmond Swayne (New Forest, West)

Will the right hon. Gentleman seek to change the Fire Services Act 1947 by bringing forward amendments to the Local Government Bill which begins its passage in the House on 7 January?

The Deputy Prime Minister

The hon. Gentleman makes an important point. The legislation will be available to us; we will be looking at what we can do in regard to that and I shall be responding shortly.

Mr. Stephen McCabe (Birmingham, Hall Green)

Does my right hon. Friend agree that ordinary firemen should not adopt a kneejerk response to statements about the Bain report but study it in the watches and at the stations, identify how they can make it work for them and their families and then instruct the negotiators to get them the best deal possible? In that context, will he continue to promote a calm and decent atmosphere that is conducive to sensible negotiations?

The Deputy Prime Minister

I think that the House will agree with everything that my hon. Friend said. The reaction of people in the fire service who listen to the debate or who watch it on television, where we have received so much publicity of late, is most important. We are not making a major attack and completely scrapping the shift system, as has been said. Of course, such reports cause great concern to fire brigades. What we are saying is that some changes are common sense and should be considered. Every fire brigade should have a 24-hour-a-day watch system and we want to keep such a system, but changes can be made. Some of them have been highlighted today and I hope that there can be a decent discussion of them among members of fire brigades.

Mr. Paul Tyler (North Cornwall)

This afternoon, the Deputy Prime Minister made several references to the fact that many of the modernisation proposals in the Bain report have already been accepted—indeed, embraced—by fire brigades in different parts of the country, not least in Cornwall and Devon. Does he accept that it would be widely resented among firefighters in those more forward-thinking brigades if the new money is used as a bribe for the backward brigades rather than to recognise and reward those that have already taken steps to accept modernisation?

The Deputy Prime Minister

We are concerned to ensure that the savings are of benefit everywhere. As I pointed out, advances have already been made in some aspects—for example, combined control rooms. We want those advances to take place throughout the system. Where modernisation proposals have been implemented, it will not be necessary to make changes, but we want to raise standards in the fire service nationally so that they are acceptable to everyone, in line with Bain, and so that they justify the payments. Areas where changes have already been made will receive the increased payments.

Mr. Dennis Skinner (Bolsover)

Is my right hon. Friend aware that the most interesting and important part of his statement was the new provision that referred to transitional funding, up-front, to resolve the modernisation question? Some of us raised that matter during a previous statement from my right hon. Friend; that is important in itself. I shall not ask—as the Tories did—how much money my right hon. Friend has in his budget although I hope that it is not a small amount. I hope the sum is big enough.

Whatever my right hon. Friend does, I ask him not to accept the proposal made earlier by the right hon. Member for Horsham (Mr. Maude) that we should introduce regional pay scales, which, by the way, was a Liberal proposition. If we accepted that proposal, the present dispute would look like a vicarage tea party.

The Deputy Prime Minister

I recognise the force of my hon. Friend's argument about regional pay scales, but there should be some discussion of it. There is a national wage for fire brigades, but allowances vary in different areas; for example, London weighting can add about £2,000 to the wage. We should have some discussion of that. The FBU should not say that such things are irrelevant; it should discuss matters that affect its members' wages.

On previous occasions, I could not be specific about transitional funding or the amounts involved because they depended on the costs and savings that could be made. Bain has now given some indication of those amounts. People accused me of sabotaging the agreement at 5 o'clock in the morning, even though I had made it clear at 3 o'clock to both the general secretary of the TUC and the employers' negotiators that I could not sign a blank cheque. However, one of the difficulties was that they did not know what savings could be made; in 25 years, the possible savings had never been worked out. Some joint work has now been carried out between Bain, ourselves and the local authority employers and I can now say how much we would save if the proposals were implemented.

An awful lot of work was needed but the principle is clear. Transitional payments will need to be agreed for a three-year period, but I cannot enter into any agreement unless there is a modernisation agreement that will take us to year three. I am not prepared to make the same mistakes that were made time and again whereby there was agreement on pay first and then talk about modernisation. This time, the two must happen together.

Mr. Mark Francois (Rayleigh)

I welcome the particular recommendation in Bain that enhanced terms and conditions should be made available for our retained firefighters. We all want a successfully negotiated end to the dispute, but will the Deputy Prime Minister take this opportunity to pay a special tribute to our retained firefighters? They provide critically important cover in our rural areas and many of them continued to provide emergency cover during periods when the regulars were on strike.

The Deputy Prime Minister

I want to pay tribute to all those who have been involved in maintaining our services—whether the part-time firefighters, the Army or the police, all of whom have provided quite an effective service in the most difficult circumstances. Many part-timers are involved in the dispute and support the FBU case, but all the firefighters—part-time or full-time—need to get together and say, "Change is coming, and now is the time to take part in it." They should start talking, not walking, and let us get an agreement to this dispute.

Fiona Mactaggart (Slough)

Does the Deputy Prime Minister agree that if there are flaws in the Bain report, they are largely caused by the FBU's decision not to participate in that report? Will he ensure that, as the negotiations progress, the real recruitment and retention difficulties faced by brigades on the borders of London, which do not benefit from the London allowance, are considered? That situation is practically unique in this country. If he is considering primary legislation, will he also consider whether it should extend to improving fire safety in new buildings, as well as modernising the fire service?

The Deputy Prime Minister

My hon. Friend refers to improving the fire regulations, and we certainly want to do that—indeed, legislation on improving building regulations in that way is already before the House—but we need to take a much more comprehensive approach. That is behind the concept of wanting more prevention rather than intervention. A point was made about Kent fire brigade being actively involved in fire prevention—something that the FBU has always supported, and we need to see more of it. That is the balance and change that we are trying to achieve.

As for whether there are flaws in the report, I shall listen to those views, but I think that it is a pretty comprehensive and good report. It is based on the many reports over the past 20 years that have not been acted upon, and it was wrong for the union not to participate and, indeed, to set its face against the report. The point now is whether the union representatives are sitting down, discussing with the employers and negotiating how to reach a settlement. That is still the case at the moment, and we should encourage that.