HL Deb 15 January 1992 vol 534 cc296-305

5.24 p.m.

Baroness Denton of Wakefield

My Lords, with the leave of the House, I shall now repeat in the form of a Statement the Answer to a Private Notice Question which is being asked in another place on the Apex Trust. The Statement reads as follows:

"The Apex Trust was established 27 years ago to assist with the employment and rehabilitation of offenders. It is one of a number of organisations working in that field and it has made a valuable contribution.

"Apex has been involved with the employment and training programmes of the Department of Employment for many years. It participated in employment training since the launch of that programme in 1988. It has also received core funding from the Home Office. In April 1990 the first Training and Enterprise Councils were established. In 1990–91 51 TECs were set up. The remainder were established in the current year, 1991–92. TECs took over the task from the department of contracting with providers locally for training.

"In the spring of 1990 the department recontracted with employment training providers with some adjustments in volumes and unit price. In doing so we of course gave the providers the necessary contractual notice. When all the TECs had been established my department ceased to have training contracts with Apex. All TECs have available to them working capital loans to meet initial costs and to enable them to advance funds to providers where they have thought this appropriate. The position of Apex was no different in these respects from that of any other training provider.

"In March 1991, the department agreed to make available up to £500,000 to assist Apex in adjusting to the new contractual levels of employment training. So far Apex has been paid, under that arrangement, £250,000 at the end of March 1991 and a further £100,000 at the beginning of October. Meanwhile, Apex has concluded contracts with a number of TECs and has generated revenue from these contracts.

"The department made a duplicate payment to Apex in mid-April 1991. It is difficult to know how this payment could have added to Apex's financial difficulties; the effect of it has been to provide Apex with an interest-free loan. Apex has been told that the department would be willing to phase the recovery of that sum over a substantial period of time.

"In the autumn of 1991 Apex was again in touch with the department and the Home Office, as a result of its continuing financial difficulties. The department has been helpful to Apex in a number of ways, as the noble Baroness, Lady Seear, has recognised, but I am sure that the House will accept that it would be quite wrong to make payments of taxpayers' money to an organisation on the brink of liquidation.

"I understand that the Apex Trust has announced that it plans to call in receivers at the end of the week. Today the Department's officials have been instructed to get in touch with each of the Training and Enterprise Councils which have contracts with Apex to make it clear that they are expected to ensure that all Apex trainees continue their training with other providers".

My Lords, that concludes the Statement.

5.28 p.m.

Baroness Turner of Camden

My Lords, I thank the noble Baroness for repeating that Answer. She will be aware that Members on this side of the House view it with some concern. The reason for that lies to some extent in the figures that are available this week for unemployment. Between November 1990 and November 1991 unemployment increased by 750,000. I understand that in London 60 people are chasing each vacancy. Bearing in mind that situation in the labour market it will be appreciated that some people are at a disadvantage. Included among them must be people who have been in prison and people from ethnic minorities.

Until relatively recently I was involved with the organisation Fullemploy. That organisation faced much the same kind of difficulties as Apex has faced. Fullemploy has had to cease operation. That is a great pity because it did an extremely good job for large numbers of people from ethnic minorities many of whom were women. I used to visit its centres. I was impressed by the way in which people were trying very hard to acquire the sort of skills which would provide them with some sort of ability to obtain a job in an increasingly difficult market.

I turn now to the rehabilitation of offenders. If we are a civilised society we believe not only in punishment of offenders but also in rehabilitation. It seems to me that as regards Apex, there is a special case to be made. Are we really saying that as regards ex-offenders, we shall not make a special effort to ensure that they have the necessary skills training? If so, it seems to me that we are being extremely shortsighted because we are then opening the way to a situation in which people are not rehabilitated. They leave prison and after a while, because there is no rehabilitation, they are again involved in criminal activities. And so the cycle begins again. Some years ago when I visited Holloway Prison I was told by staff that they saw a number of women regularly. There was a sort of cycle because there was no adequate rehabilitation.

Apex has had a reputation for doing a very good job in that area. I shall listen with great interest to what the noble Baroness, Lady Seear, says. It is deplorable that, as a civilised country, we cannot provide the resources from public funds to enable offenders to receive rehabilitation and some form of training. I view the Statement with great anxiety.

Baroness Seear

My Lords, I speak not only as a representative of these Benches but also, as I am sure noble Lords will know, as chairman for the moment of Apex. First, I congratulate the noble Baroness, Lady Denton, on her promotion to the Front Bench. Probably she would have wished that her first appearance had been on a rather more cheerful subject. I sympathise with her about that and I know that it is not her fault.

The whole story of Apex is complex. I do not intend to take your Lordships' House through the entire history. However, because it is complex it is not surprising that the Statement reflects certain inaccuracies about which your Lordships' House should be informed. I do not for a moment suggest that they are deliberate inaccuracies. I repeat that it is a complex story and I am not surprised that it has become a bit snarled up—and I use non-parliamentary language.

As regards the £250,000, that is a dramatic sounding figure. It is particularly dramatic when one receives a letter on 3rd January this year stating that the Department of Employment has paid that twice by mistake and wants it returned at our earliest convenience. I do not know what would be the earliest convenience of any Member of your Lordships' House in finding £250,000. However, that is in passing. The money has attracted attention; it has distracted attention from what are the basic issues.

The Statement refers to changes which have taken place. Apex operated training programmes satisfactorily with the MSC for a number of years. At that time there were no financial problems. I wish to stress that because the point was made this morning that there had been financial irregularities. That is an extremely serious allegation and I refute it. If your Lordships look at the relationships between Apex and the MSC, it can be seen that, financially they were entirely satisfactory.

When the employment training scheme came into force we contracted with the department to run a number of centres using employment training money. That went satisfactorily until the time at which the department decided, unilaterally, to change the terms of the contract. As the noble Baroness said, there was a 28 day clause in the contract and that clause was invoked so that, strictly speaking, the department was within its legal rights. However, your Lordships' House will understand that when 30 projects are being run up and down the country for which it is necessary to hire premises and staff, arrange equipment and deal with the 101 matters which must be dealt with when running establishments of that kind, 28 days' notice, with a much lower rate of pay imposed afterwards, is a very difficult adjustment to make. Undoubtedly, Apex lost a considerable amount of money as a result.

I have said before and I wish to repeat that all the way through the Department of Employment has tried to be as helpful as it can, presumably not because the department is fond of us—is a department ever fond of anybody?—but because it recognises that the work is extremely valuable. It offered to pay up to £500,000 for shutting down costs, which are considerable, as your Lordships will know. That was the arrangement.

We then moved on to TECs. We had to negotiate with the TECs, which is quite expensive. However, we negotiated contracts with eight TECs. What has not been said in the Statement and what is extremely important is that we ran into considerable difficulties because the TECs are very late payers. We were being paid nine weeks in arrears. We have to pay rents up front and salaries on the 20th day of each month. When one is talking about one third of a million pounds being delayed in payment, one runs into financial problems as we did. That was not because of inefficiency or incompetence but because the TECs were paying late.

The Statement says that working capital loans were made available. I have raised this point in the House before. I have been told, and it has not been denied, that the loans were to facilitate improvements in cash flow problems. Of the eight TECs with which we were dealing, two used the money for that purpose. I do not know what the other six TECs did with their money but I assume that they put it into the bank and drew money on it which is what I should have done in their position. However, we did not receive that money. So our cash flow problem was not eased by the taxpayers' money—and we are all concerned with taxpayers' money—which the Government made available for that purpose. That got us into difficulties.

So great were those difficulties—and this was a shock to businessmen in your Lordships' House—that we were reduced to factoring our invoices in order to pay our bills. That meant that we lost on the money when we received it ultimately. There was no other way because of the delay. That created the impression that we were about to become insolvent. Because there was doubt about our solvency the Home Office said —and I understand this because it is obviously correct —that public money provided by government departments should not be paid to organisations which may be insolvent.

I have explained the reasons for our potential insolvency in the middle of last year. The Home Office had always paid us core money and because of the doubts about our solvency, it has not paid any core money for the past six months. The fact that that has not been paid at all has made the insolvency a great deal more likely to take place than would have been the case if that line had not been taken. That has been the real cause of the problem.

The question of the £250,000 is a different matter. That is in dispute between us and I shall not go into details unless your Lordships wish me to. It is a long and complicated story. It is not the main issue. However, because the department says that we owe it money, all other government payments to us—money owed to us, as is admitted—is frozen, so that no money is coming in. That is the reason we are saying that must go into liquidation. We would be trading illegally because no money is coming in. That is the way the situation arose.

I want to make only one other point. I can see the ex-Whip thinking that it is high time I sat down. I may be misinterpreting his body language, and if so I apologise. I could make many points, but I shall not. However, I want to make one point very strongly indeed. The Statement said that other people can take on this work; that there are plenty of other people doing it. That is not true. We are the specialists in the training and placing of ex-offenders. NACRO does some of it, but it does many other things too. NACRO claims to be, rightly and successfully, a campaigning organisation. We are not. It may surprise your Lordships' House to know that I have always stopped our people campaigning. I say, "Your job is to train and to place. Do not get muddled up with anything else". We believe that that is the only way to be successful.

The idea that those people who would otherwise be trained by us will be satisfactorily trained elsewhere is a myth. Many in the training business are commercial trainers and no commercial trainer in his right mind will take on ex-offenders. They are about the worst commercial proposition one can envisage. They need a special organisation to look after their requirements. Training is a skilled business. Around 25 per cent. of the people who come to us are suffering from severe innumeracy and illiteracy. They often also suffer from a serious lack of confidence and belief in themselves. It takes longer and a different approach to put ex-offenders back into the market place. It also needs good relations with employers, which we have built up over the years. It needs good relations with prison governors and staff, which we have also built up over the years. If Apex is disbanded all that expertise will be thrown away. The Government should not fool themselves into thinking that commercial trainers will take it up. They will not.

That is my main point, though there are many other points I could make. We have done everything we were asked to do. The Government speak of a partnership between the statutory, the private and the voluntary sectors. We are the voluntary sector. The private sector behaved magnificently. We had the greatest help from British Telecom, British Gas, Nat West and others. Where we have been let down in the partnership is in the public sector. It is a short-sighted view if one is considering the long-term benefit of UK Limited.

I believe that it costs £310 at least to keep someone in prison, and I may be out of date. What chance is there for someone with a record who does not obtain a job? If one does not possess skills, the chances of employment in this country, even if one's record is white as the driven snow, are extremely poor. If, on top of that, one has a criminal record, one would be well advised to settle for a life of crime.

A probation officer this morning said, and nobody denies it, that if one gets an offender into work he is three times less likely to go back into gaol. I say to the Government, "If you want to empty your gaols—and you say you do—and that is the point of the Criminal Justice Bill; if you want to keep people out of prison, get them into work. And to do that you need specialist agencies."

Noble Lords

Hear, hear!

Baroness Denton of Wakefield

My Lords, I thank the noble Baronesses, Lady Turner of Camden and Lady Seear, for expressing the anxiety that everyone feels on the subject of the training of ex-offenders. I thank the noble Baroness, Lady Seear, for her kind remarks in noting my promotion. However, the Statement could not be a more serious subject on which to make my debut and my concern could not be greater. As evidence of that I would point out that in a previous role with the Black Country Development Corporation I authorised money for training ex-offenders.

However, in this instance there are certain matters which I must clear up. There is no question of a suggestion of financial irregularities.

Baroness Seear

My Lords, perhaps I may interrupt the noble Lady. The remark was made at a press conference this morning by a supporter of the Government. I deeply resent it.

Baroness Denton of Wakefield

My Lords, I apologise. I shall certainly look into the matter and write to the noble Baroness.

I understand that money for services from Apex has not been frozen. The Government have already made considerable sums available to Apex. The Department of Employment and the Home Office represent most of the trust's funding. Regard must be had to the fact that the overall financial position of Apex is weak, as it accepts. That has implications for the way we deal with requests for further help. The proper stewardship of public money requires everyone to tread carefully.

The duplicate payment of £250,000 is not in dispute. I confirm that the department offered to discuss a phased repayment of it. Answers to issues raised were dealt with by the department; loans were given for up front funding. However, it is not the department's policy to direct centrally to the TECs, which were created to look after local employment needs. The loan was made; other payments were given for closure costs, appreciating the differences that were involved.

5.47 p.m.

Lord Wyatt of Weeford

My Lords, listening to the noble Baroness, Lady Seear, on the wireless this morning I was most impressed. I was equally impressed by what she said this afternoon. There is no doubt that Apex is an admirable organisation which has built up a wealth of specialist expertise. The job must be done by somebody. If Apex is allowed to collapse more money will be spent than otherwise on recruiting other teams from other sources to do exactly what Apex was doing. Those teams will have to go through a learning curve. What is the sense of cheeseparing on this specific matter? No money will be saved and probably more money will be spent than otherwise.

Baroness Denton of Wakefield

My Lords, I thank the noble Lord for his remarks. The Government have been as helpful as they can in offering phased repayment of the overpayment. However, they cannot pay more money to a body that is already indebted to them.

Lord Prior

My Lords, perhaps I may first congratulate my noble friend on her appointment to the Front Bench. I am certain, as the noble Baroness, Lady Seear, pointed out, that this is not an occasion on which she would have liked to have made her maiden appearance from the Front Bench.

A number of us on the Back Benches regard what has happened as a retrograde step. I could see it coming. It has been coming for some while. I suspect that the reason it has been coming is that it is not a priority for the Department of Employment to spend money in this way; but it is an absolute priority for the Home Office. The problem is that the Home Office does not possess the money and always thought the Department of Employment had it. That is what has happened. It is one of those silly muddles where the Treasury gets in the middle and nothing happens.

I cannot believe that it is the will of the Government, of the Opposition, of this House or of the House of Commons that in seeking to help and train ex-prisoners, we should deny the resources to the private sector and to an organisation which has worked well for a number of years. It has been caught between two departments. Also there is always a certain view within the Civil Service that private organisations are a bit of a nuisance and that it is better if everything is done so that there is accountability to the Permanent Secretary in a different way. On this occasion all these factors are contributing to what is a terrible mistake. I beg my noble friend and the Leader of the House, who is in his place, to have this matter looked at again. If we cannot look after ex-offenders and train them properly, as the noble Lord, Lord Wyatt, has pointed out, we shall have to pay a terrible price in pounds, shillings and pence let alone in the social life of this country. I ask my noble friend Lady Denton to look at this matter again.

Baroness Denton of Wakefield

My Lords, I assure my noble friend Lord Prior that I shall take his anxieties and those of the House expressed today to my right honourable friend the Secretary of State. I shall make those anxieties clearly understood. I wish to point out that Apex's contract with the department in 1990–91 was worth £3.3 million and that there is a concern for the training of ex-offenders. There are experimental pilot programmes within TECs for training people still in custody. The period of custodial sentence counts as unemployment for the purposes of eligibility. Therefore, in effect, ex-offenders are given priority.

Lord Ennals

My Lords, clearly in no sense is this a party political issue. Happily, concern has been expressed from all sides of the House. I agree with the point made by the noble Lords, Lord Prior and Lord Wyatt. We are fortunate in having for the first time on the Front Bench in this role a Minister who understands something about the problem. She may have been given not only the sad opportunity of making a disappointing Statement, but an opportunity now to do something very positive and constructive.

I first came into contact with Apex over 20 years ago when I was working as a director of MIND. Some ex-offenders are people who have had psychiatric problems early in their lives. As I have said, I had close contact with Apex about 20 years ago. I greatly admired the work that it did. It acquired a skill and an expertise both as regards the needs of ex-offenders and also an understanding of the firms that would take them on. It has done an invaluable job.

In congratulating the noble Baroness for being on the Front Bench, I wish to say to the noble Baroness, Lady Seear, that the community owes her a great debt of gratitude because she has stepped in at a time of crisis for that organisation. I do not look upon it just as a crisis for the organisation but as one for society in facing this problem. If this organisation goes out of existence, the Minister has been unable to say what will happen. I honestly believe that the Home Office and the Department of Employment have a responsibility to ensure that there is a specialised agency which is able to cope with trying to find opportunities for ex-offenders.

There could not be a worse time in our economic situation for people to get jobs when what they have to offer has a horrible black mark put against it although they may be people of the highest quality. I hope that the Minister will go a little further than she has already done. She cannot make a commitment. I hope that it will not be just officials who enter into discussions. It is perfectly clear that the department recognises that Apex is a fine organisation, and that what it is doing has to go on being done. I say in the hearing of the Leader of the House that I hope that Ministers will take on themselves a responsibility to find a way through this problem. I refer to the old rules that money cannot be paid; but I do not know the details. However, I am certain that an answer can be found if there is the will to do so. I plead with the Leader of the House and the Minister.

Baroness Denton of Wakefield

My Lords, I thank the noble Lord, Lord Ennals, for his kind remarks. It is the courtesy of the House which makes my task a little easier. I agree with the noble Lord wholeheartedly that any organisation which has the benefit of the noble Baroness, Lady Seear, as chairman is fortunate.

The Government are deeply committed to helping and training those with special needs including ex-offenders. TECs are contractually obliged to make such provision available and to ensure that there is this benefit. As I have said, officials will be in touch with each council. I am sure that after our debate and that in the other place, that there will be no doubt that the matter will be watched with great concern.

Lord Harris of Greenwich

My Lords, is the noble Baroness aware that the cost which she mentioned is trivial compared with the cost of crime in this country? Is she further aware that the Statement she has made today, if it leads to the death of Apex, will almost inevitably lead to still more people being sucked into the prison population? How can that make sense at a time of rapidly rising crime in this country? It is astonishing that the Government have permitted this situation to arise at a time when ex-offenders are finding it increasingly difficult to secure employment because of the overall current unemployment situation.

Perhaps I may give an individual example. Is the Minister aware that one of the critical issues faced by the Parole Board in determining whether someone should be released from prison on parole licence is whether they are going to secure employment? Is she further aware that what she has said today will make it almost certain that more people will be denied parole because they will not have employment opportunities when they leave prison? How can that be right at a time when the prison population is rising monthly?

Lord Donaldson of Kingsbridge

My Lords, before the noble Lord sits down perhaps I may add—

Noble Lords


Lord Boyd-Carpenter

My Lords, I believe it is now the turn of this side of the House.

Baroness Denton of Wakefield

My Lords, I thank the noble Lord, Lord Harris, for drawing attention to matters of such great importance. The issue today is the fact that the Apex Trust has announced that it will probably go into liquidation at the end of the week. Therefore, it is impossible to put further taxpayers' money at risk in that situation.

Lord Boyd-Carpenter

My Lords, will my noble friend at least accept congratulations and the hope that in the course of what I am sure will be a long and distinguished ministerial career, she will never have a more difficult Statement to make than the one with which she has opened that career? Does she appreciate (as I am sure my noble friend the Leader of the House does) that the House will be very unhappy to leave the matter here?

It will be unreasonable to expect the Minister to indicate what is going to happen at this stage. However, the House would value an assurance, perhaps from the Leader of the House, that within a reasonable time we shall have a further Statement as to what the Government's intentions are. Simply to leave the matter here will cause great unhappiness on both sides of the House and with intelligent public opinion outside. People will be greatly reassured if we can be told that the Government are working hard and rapidly on preparing the steps to take in this situation, and that your Lordships' House will be informed of these at an early date.

Lord Waddington

My Lords, I believe that matter is for me. I can tell your Lordships that it was repeating in the form of a Statement the reply to a Private Notice Question in another place. I shall have to read what was said in another place. I shall certainly discuss this matter with my right honourable friend.