Westminster Hall Sitting of 29 June 2004

Preamble
[SIR NICHOLAS WINTERTON in the Chair]

Premium Telephone Numbers
Motion made, and Question proposed, That the sitting be now adjourned. [Derek Twigg.]
9.30 am
Sir George Young: I welcome this opportunity for a debate on premium rate numbers and the growing problems of abuse to which my constituents are falling prey. I note that several other hon. Members share my concern. It is good to see the Minister in his place. If I may say so, he is an effective political firewall for his Department, neutralising and repelling hostile attacks.
This is a topical subject. Last Thursday's edition of The Times featured a story by Helen Nugent—"BT chases phantom sex caller as bills soar"—and the day before I read "Pop-up scam hits internet phone lines" by Liz Philips in the Money Mail. The Sunday Times two days ago included the story "Premium rate robbery" by David Hewson, and I have a large number of headlines from press cuttings that were helpfully provided by the Library: "New mobile phone scam promises prizes but could cost a small fortune", "BT urged to act over internet scam", "Couple dispute £750 phone bill", "BT customers may sue over internet rogue-dialling scam" and, last but not least, "Phantom of the phone sex lines strikes again in Middle England".
I shall describe the premium rate number industry, set out the abuses that are now rife, analyse the regulatory response, which I believe to be wholly inadequate, and suggest some possible remedies. Basically, the premium rate number market revolves around the use of the 090 telephone number range, for which charges to the caller are up to £1.50 per minute. Most of the premium rate market, which is worth £1 billion per annum, does not involve any abuse. It embraces the voting lines for "Big Brother", lines for weather reports, technical help desks, chat lines, horoscopes, TV games, charities, music downloads, Government Departments and what is politely called adult entertainment The world would continue to rotate without premium rate numbers. Indeed, many countries have banned them. People in those countries who want to pay for premium services over the phone pay by credit card. I shall return to that nuclear option later.
The structure of the industry is not straightforward. Let us start with the network operator—BT. NTL or Telewest. They are the folk to whom we pay our phone bills. A premium rate call goes from our phone line through two separate organisations. First, it goes through the terminating network operator, of which there are several dozen. They are the owners of the 090 numbers, which are allocated by Ofcom. They in turn lease the numbers to service providers, which provide some 30,000 services. They are at the end of the chain and may or may not be located in the UK.
It is important to understand not only the structure of the industry, but the revenue-sharing arrangements. All the money that ends up in the hands of the fraudsters starts off in the hands of reputable telephone companies. As BT is typically paid quarterly in arrears for calls by its customers, it may be paid up to four months after a premium rate number has been called. However, it pays out to the terminating network as early as 14 days after a call has been made. BT keeps between 6p and 7p per minute and hands the rest to the terminating network, which, as the 090 host, keeps its percentage of the revenue and pays out the remainder to the service provider, which typically gets 80 per cent., although in some cases it may be less. The secondary settlements can take place weekly. If there is an abuse, it may not be noticed for some time; typically, it will be noticed when the subscriber gets a phone bill. In the meantime, the fraudsters receive their money—in some cases, they do so as soon as seven days after the call—leaving BT or NTL exposed and an argument about whether the bill should be paid.
BT is, in effect, acting as a credit card for the sale of services via the telephone line, but without some of the essential features of the credit card market. For example, a credit card company can be held jointly liable if the goods supplied by one of its merchants are faulty. In the cases we are debating this morning, however, BT has no control over the "merchant", because an intermediary in the process licenses the merchant and BT and other carriers are obliged to carry the traffic that presents itself. Again, I will return to the revenue-sharing arrangements at the end of my speech. That is the industry in a nutshell: the majority of carriers are responsible and law-abiding, but a minority are not so.
Abuse can take place over a telephone line, involving either the telephone or computer attached to it. Starting with the telephone, last year a spate of misleading and unsolicited text messages conned people into calling premium rate numbers to win non-existent prizes. Typically, a text message would appear on the screen of a mobile, saying, "Congratulations, you have won £2,000. Ring this number to collect your prize." It would not be made clear that the number was a premium rate number; that those who rang it would have to listen to a long pre-recorded message at £1.50 per minute; and that the prize would often be elusive or valueless. Children with mobiles got those messages, and in comparison with adults, they had less chance of knowing that they were a scam.
The Independent Committee for the Supervision of Standards of Telephone Information Services—ICSTIS—is the regulatory body, and it notes:
"During the second half of 2003 we had to deal with over 7,000 of these complaints. In most cases it became evident that there was both spam marketing taking place and that 'services' associated with the text promotions were at best misleading and at times apparently fraudulent."
Clearly, there was substantial abuse in that part of the market.
Scams targeting computers have generated most publicity recently. There are some legitimate services that can be accessed by dialling an 090 number via one's computer. When that happens, the computer will disengage from the normal service provider, dial a premium rate number and the user's phone bill will be charged accordingly. The principal type of abuse takes

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place when, unbeknownst to the owner, the computer initiates the dialling of the premium rate number. That can happen when a rogue dialler is installed, often through an unsolicited pop-up box that looks like an advertisement. It may ask the user if they want to download some software, and even if they click "no" or close the box, the software is downloaded. It replaces the number that the computer normally dials to get on line. which is typically 08, with a premium rate number—09. The rogue dialler is sophisticated enough to turn off the modem dialler, so that the user does not hear it dialling away at their expense. Some diallers call the 090 number once, some call programmatically—for example, in the early hours of the morning if the computer is left switched on—and some change the default dialler.
There are cases in which a member of a household dials one of those services, but denies having done so when the bill arrives. That obviously causes problems in the household and for BT. However, there are enough cases of clear fraud to cause concern, and they have been well documented in the press. Other hon. Members may also have their own examples.
Mr. and Mrs. Higdonof Maidenhead faced a £744 bill, run up in six weeks by calls to premium rate numbers linked to websites owned by a company in west Africa of which they knew nothing. BT has not so far waived the charges. A constituent e-mailed me last week after being charged for an internet call that he did not make. When he reported it, he found that it was already under investigation by ICSTIS, but BT has told him that its policy is not to refund.
Malcolm Bruce: The right hon. Gentleman makes an important point. Does he not agree that even if people have knowingly accessed a premium rate number, they should also be given information about the charging rate? The fact that they may be embarrassed to admit that they made the connection should not be an excuse for people to rip them off.
Sir George Young: The hon. Gentleman is right. The ICSTIS code makes it clear what information must be given to the consumer about the rate that is being charged, but, sadly, some rogue diallers do not provide consumers with those details.
Money Mail tells us of Raquel from Kensington who ran up a £300 bill, probably through a rogue dialler. She has been cut off by NTL, which will not reconnect her until she pays. Susan Westnedge was mentioned in Money Mail on 23 June. Her BT bill suddenly trebled from £50 to £150 in April. Nine calls had inexplicably been made to São Tomé in west Africa. She said:
"When I rang, I was told nothing had been done to prevent this continuing. I was told BT was inundated with similar complaints about fraudulent calls."
Some 19,000 BT customers are currently having calls to premium rate numbers investigated. At £102 per sum disputed—an ICSTIS figure—that is some £2 million of potential fraud, and those are just the cases that have been reported to BT.
The high-tech crime unit of the police is now involved and has stated publicly that it suspects collusion and/or conspiracy to defraud within what is called the value
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chain. However, with much of the fraud committed by companies based overseas, it may never bring the culprits to book.
What has been the regulatory response to the abuse? The role of ICSTIS is to prevent consumer harm by requiring clear and accurate pricing information; honest advertising and operation of services—that relates to the point made by the hon. Member for Gordon (Malcolm Bruce)—and appropriate and targeted promotions. It is funded by the industry, with a budget of some £2.8 million in 2004. It enforces its decisions through an Ofcom-approved code of conduct. It sets and reviews standards of content and promotion for premium rate services, and it licenses services, ensures compliance, investigates complaints, adjudicates and applies sanctions, such as fines. That is the theory.
In its October 2003 newsletter, ICSTIS said of text messages, the first scam I that mentioned:
Wherever necessary, we have acted to bar access to numbers and impose heavy fines "
However, when I took up a constituency case in that very month, the response was wholly unsatisfactory. I e-mailed ICSTIS on 18 October last year, after a constituent got a message that said:
"Urgent; your mobile number was awarded a £2000 bonus."
To collect the prize she had to telephone a premium rate number, with a long pre-recorded message, which cost about £8. I got no reply to my e-mail to ICSTIS and wrote again on 7 January. I also wrote to the company responsible—Prize Line, PO Box 80, 571 Finchley lane—and never got an answer. I eventually got a reply from ICSTIS on 10 March, four and a half months later:
"I am responding to your email of October 18th and your subsequent letters of 11 and 27 February. I am sorry you have had to chase for a response in this way."
If that is the service given to MPs, what sort of service do our constituents get when they contact ICSTIS directly? In its consumer guide, ICSTIS says that it aims
"to resolve all complaints quickly, effectively and consistently".
That was not my experience in this case.
The letter went on to reveal the failure of the regulatory system. To take action against the service provider at the end of the chain, ICSTIS needs to get its identity from the terminating network—the guys in the middle. The letter stated:
"While we have been active in closing down services, the co-operation of the terminating network is required in every case. In some cases, we have problems with network operators failing to provide the necessary information promptly or otherwise failing to assist us with the investigation of cases. This information is essential if we are to act to close apparently rogue services in order to stop harm. In your case the network responsible for the 090 number is One World Interactive and the service provider contracting for its use was Smile Telecom Ltd … The identity of the service provider was not however known to us for a period of 10 weeks as a result of delays at the network level."
In other words, when an alleged scam was reported, ICSTIS could not close it down because the host would not reveal the name of the service provider. And so the scam continued, with money going to Smile Telecom, until eventually One World Interactive told ICSTIS who had the number.
On the current scam involving rogue diallers, the regulatory system seems to be in meltdown. Many have tried to complain to ICSTIS, but the line has been

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constantly engaged. The helpdesk is in meltdown because of a record volume of complaints. On 16 June, the ICSTIS director, George Kidd, said that it had never before had to respond to so many complaints from the public. Daily, 2,000 calls are being reported to ICSTIS—and those are the ones that get through. With such a high volume, it takes up to 26 weeks for ICSTIS to conclude investigations.
I note from ICSTIS's June newsletter that the Minister said:
"ICSTIS does an excellent job, and is a good model of effective self-regulation without, until now, any legislative support".
In light of the current circumstances, I wonder whether he stands by that statement.
ICSTIS has the ability to fine, but 70 per cent. of fines do not appear to be paid, presumably because the offending company is based overseas or is in liquidation. ICSTIS tells me that, in 2003, it fined the highest sum in its history. That was a reaction to the batch of wilful spam and scam mobile promotions that swept the UK, which I have mentioned. The basic figures for 2003 show that 209 companies were fined a total of £1.26 million, of which less than £500,000 was paid. Some fine income received in 2003 relates to fines set in 2002. Equally, it is likely that fines issued in the last month of 2003 will not be settled or written off until early 2004.
So there is abuse and regulatory failure. That leads me to remedies. A first option would be a total ban on premium rate numbers. That has happened in other countries. It would mean that legitimate enterprises—"Big Brother" and the like—would be unable to collect revenue via a premium rate service. I suspect that that would affect the viability of some popular television programmes. The alternative revenue stream could come from credit cards, but that is logistically more difficult for the companies and less convenient for users of genuine premium rate services. I personally would not favour that solution at this stage, but if I were the Minister or ICSTIS, I would use the threat of closure in the near future as an incentive for the industry to get its act together.
Mr. Mark Lazarowicz: I am grateful to the right hon. Gentleman for bringing the issue to the attention of the House. I am sure that there is not a single Member of the House or of the population who has not been affected in some way by someone trying to sell premium rate numbers to them.
Will the right hon. Gentleman expand on why he has rejected the idea of a total ban on premium rate numbers? With so many abuses, is there not a case for that simple resolution of the problem? To use his example of television reality shows, I am sure that the makers or the companies would find some way of allowing the public to vote for them. It seems hard to suggest that the world would be a worse place if we did not have premium rate telephone numbers.
Sir George Young: The hon. Gentleman makes a strong case for abolishing premium rate numbers. As I said, I do not rule that option out. My initial view is that, as the majority of the industry is responsible, it would be sad if the activities of a minority wiped out an industry. I hope that we can improve the regulatory system in the
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way that I am suggesting, which would mean that the fraud was wiped out, but would enable the legitimate industry to survive. I do not rule out abolition in the long term, but I think that it would be a bit defeatist to go for that option at this stage.
The second thing that we could, and I think should, do is make the terminating networks responsible for the fines imposed by ICSTIS on the service providers if they are not paid. That would encourage the owners of 090 numbers to be far more careful about the folk to whom they lease the numbers. Of course, unlike ICSTIS, those owners can access revenue flow to ensure that the fines are paid. At the moment, the terminating networks are not at risk, although the fraud can take place only with their compliance. Moving responsibility for collecting fines to the terminating networks would significantly reduce the administrative burden on ICSTIS, which is seriously stretched.
Thirdly, the terminating networks could be asked to put up bonds before they can issue numbers. The bonds could be drawn on either if the fines remain unpaid or for the resourcing and funding of a proper compensation scheme, of which I shall say more in a moment. Fourthly, the TNOs should be stripped more readily of their licence to issue numbers. I mentioned earlier the delay in providing ICSTIS with the details of Smile. ICSTIS told me:
"The real problem however was the subsequent reluctance and in effect refusal by One World Interactive to provide us with the service provider information for the number range in question."
Why in heaven's name is Ofcom or ICSTIS allowing One World Interactive to go on issuing 090 numbers if it refuses to co-operate? Service providers get away with the scam only because of shoddy work by a few TNOs, but ICSTIS seemed reluctant to act. On 10 June, it told me that
"we are involved in three enforcement actions against terminating networks who have failed to provide us with information or who have failed to prevent access to services when so instructed or who have failed to withhold payments when told to do so."
Those are the companies that issue the numbers; they should be thrown out.
Fifthly, we should change the arrangements for the flow of revenue. The rapid outpayments that I mentioned earlier reduce the likelihood that funds can be frozen at the network level, even when an emergency procedure is invoked. Weekly payments to service providers should stop at once. I was surprised to learn that modest reforms to the payment regime may require legislative change. When I queried the current regime with ICSTIS, I was told:
"You should note that there are legal constraints on our right to require that monies be withheld at the TNO level pending completion of an investigation. If the Committee agree there is the risk of serious harm, they can approve an Emergency Procedure action of the kind previously described. This involves an instruction to withhold revenue to the TNOs involved. If the case does not merit pre-emptive action we are advised that it would be prejudicial to withhold payments, other than provision for administrative costs, pending an eight to twelve week process and adjudication."
BT is also quoted as saying that it could be sued if it does not pay the premium line holder monthly. Perhaps the Minister will comment on whether there are legal constraints that prevent slowing down the revenue flow—particularly when there are allegations of fraud—
which I regard as an important part of the solution.
Sixthly, one could ask the service provider to put up a deposit, which it would lose should it be found by ICSTIS to be abusing the system. Service providers should also register details with ICSTIS of what they plan to do and get prior permission—something that used to happen but which has now stopped.
Seventhly, ICSTIS needs more resources simply to cope. It needs more people on the helpdesk, quicker investigations and a more proactive approach to prevent abuse. The levy on the industry should be put up to fund this; I am certainly not advocating any taxpayer support. I welcome much of the work that ICSTIS has done. It provided advice recently to MPs on how to help our constituents, and it recently participated in a seminar chaired by the hon. Member for Sheffield, Hallam (Mr. Allan), which was very helpful. However, it is drowning under the wave of complaints.
Eighthly, we need more publicity for free premium rate service barring, free software downloads and better customer education. I welcome what BT is doing by contacting every BT customer over the next few months to alert them of that and it has already e-mailed its 1.8 million retail internet customers. Perhaps it should be bolder about cutting service providers off when fraudulent activity is taking place.
Ninthly, we need a faster uptake of broadband so that the problem of rogue diallers cannot arise. I know that the Minister is committed to roll-out, but the issue at the moment is low take-up where it is available.
To bring the score up to 10, and to conclude, what is needed is an effective, comprehensive and properly resourced regulatory regime with meaningful sanctions promptly enforced and an efficient compensation scheme for telephone subscribers who are ripped off by fraud. We are some way from that goal, and I have identified some milestones along the route. If we do not start moving along it, we should look again at the nuclear option mentioned by the hon. Member for Edinburgh, North and Leith (Mr. Lazarowicz) of removing premium rate numbers entirely. I hope that the Minister will be able to respond to this debate by outlining a strategy for recovery.
9.54 am
Mr. Derek Wyatt: I congratulate the right hon. Member for North-West Hampshire (Sir George Young) on securing the debate and thank him for his long and detailed speech, which will make the speeches of others much shorter. I also apologise to the Minister because I am supposed to be in two other places at once; a Select Committee meeting and a meeting with the Under-Secretary of State for the Home Department, my hon. Friend the Member for Don Valley (Caroline Flint) where we shall deal with some of the issues raised today. Please forgive me if I am not here at the end of the debate.
Previously, Government debates have been concerned with the Independent Broadcasting Authority, the Independent Television Commission, and the problems of floating a licence for ITV or putting it into the public domain. In 1998 there was a bidding document on 3G phones. Neither system was right, but we are beginning to tease out something on which, as the
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right hon. Member for North-West Hampshire said, there should be a bond. If we cannot solve the problem, I suspect that we may have to return to saying that the cost will be x up front, which is one way of solving some of our problems. There is a second, nuclear option.
Two of my constituents have e-mailed me. The first stated:
"I don't really know the technical side of it. As I understand it, I must've visited a website which then sneakily changed my dial-up phone number. I believe that I made all the calls that were on my phone bill—but that the dial-up number was changed to a premium rate number … I am careful not to open up pop-up windows when visiting most websites, but some open automatically.
I was told by someone at work that her husband phoned BT and asked them about it and they said that your computer would only be affected like mine if you visited 'adult' websites. I don't know how much truth is in that".
The cost to my constituent was phenomenal. She spent 47 minutes on the internet through a premium-rate dial-up without knowing it and it cost her £60.45. Her usual phone bill is around £65.73, so there was an enormous increase in her bill.
The second constituent stated that if someone had access to websites without going through a recognised service provider such as BT or AOL, sites were often prone to add-on programmes that illicitly and illegally changed the dial-up telephone number without notification. There were innocuous questions at some point and if the x in the top right hand corner was not clicked, agreement was effectively given. My constituent thinks that that is very underhand and that it is wrong that it is allowed to continue.
Mr. Richard Allan: It is important to dispel a myth about visiting websites. Every day, my inbox contains e-mails carrying diallers, which are effectively viruses. If I click on or do anything with those e-mails, the dialler will be installed on my system. It is important that users understand that the problem exists on e-mails daily and that the suggestion that someone must have visited an adult website is not true.
Mr. Wyatt: I agree with the hon. Gentleman.
We have heard about the scale of the problem from BT, which said that 19,000 of its customers are having calls to premium rate numbers investigated. It went on to say that that figure is not considerable for BT, but I simply do not know how long it will be before those calls are investigated and I doubt whether BT has the resources to do so. Our constituents are very concerned, especially older people who do not really understand. Younger people are web-savvy and mobile-savvy and get the gist that something is going on, but an elderly woman may not realise until she receives a bill for £700 or £800 and BT, NTL or Telewest tells her that she must pay it. The whole telecoms servicing section should be looked at. I cannot understand how BT can deal with 19,000 customers.
There are several cases in my constituency and it seems that BT is saying that it will take them off the account, park them in a lay-by and have a debate, but that is not good enough because so many cases are

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coming in; 2,000 a week. How on earth can ICSTIS cope with so many? It is bad enough with BT, but ICSTIS is seriously under-resourced.
Perhaps the Minister will comment on whether the role of ICSTIS as a regulator is part of the problem. Should it be in the business of providing advice and information online and through its helpline, or should it be pulling back and limiting itself to an enforcement role? At the moment, it cannot do both. Every week, 25,000 people try to get through but cannot because it is simply impossible to find a free line. ICSTIS reckons that it handles about 25 per cent. of calls. That is not reasonable. Unless there is some way of splitting ICSTIS or making some short-term funding available, I do not see a resolution to the problem before Christmas. All that will happen is that many more thousands of people will be severely embarrassed by their phone bills. We cannot just leave the issue in mid-air and hope for resolution at some stage. We need a short-term fix, and a short-term fix tomorrow would do.
The right hon. Member for North-West Hampshire mentioned the piece by Helen Nugent in The Times last week. Let me refer to some of the bits in it that surprised all of us; 18 households in the hamlet of Mew Green near Bardfield Soling in Essex were charged £1.50 a minute without their knowing, and dozens of villagers in Helions Bumpstead near Haverhill were charged, as were 28 of the 65 households in Thurne near Acle, where I was called yesterday by the BBC to do a radio interview. No one can quite understand what is happening. Mystery phone calls are being charged to people.
A cybercrime unit is needed to deal with these rogue forces. One problem is that cybercrime is not taken seriously in this country. In fact, I understand that none of the Home Office figures in the public domain include cybercrime.
Malcolm Bruce: Is not it the case that the boxes in the street are accessible with a T-key? Anyone who knows what they are doing can access them, dial a premium rate number and charge it to a domestic bill. Is not the first priority to have a little more security on the boxes?
Mr. Wyatt: The hon. Gentleman is absolutely correct. That is a problem, and we need greater security.
The Network for Online Commerce, which was set up in 1994 as a not-for-profit trade association, has been in touch with me. In March 2004, it created the dialler action group. It had been talking to ICSTIS and had become worried that ICSTIS was overwhelmed. I have received a letter from its chairman, who says that the NOC is totally supportive of ICSTIS but suspects that, under its current structure, it is difficult to react with sufficient speed and technical appreciation of this sophisticated market. The NOC is working with ICSTIS to assist in assuring effective change to limit any industry problems associated with diallers. ICSTIS is overwhelmed, not just by technical issues but by its day-to-day activities. To constituency MPs, the problems seem similar to those of housing benefit or the Child Support Agency. The system is overwhelmed.
I wonder whether I might put in my three penn'orth. I do not have 10 suggestions, but I have had an interesting e-mail from David Knell of Coulomb Ltd.
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about the terminating network operators, which are important. He makes three recommendations that are worth considering. First,
"ICSTIS should be able to set and revise the level of the bond required from each TNO".
That is key. That can be done now; in the future, perhaps it will have to be done up front. I recommend that proposal. On his first recommendation, he goes on to state:
"In the event of complaints against one of that operator's service provider being upheld by ICSTIS, they should instruct the TNO to compensate the customer."
Our constituents have nowhere to go. They do not know how to complain and cannot get through, yet they are worried about their bill, which racks up interest. They are very concerned.
Mr. Knell'ssecond recommendation states:
"TNOs who wish to provide dialler services will need to accept that there is a short-term need to provide additional funding to ICSTIS to allow them to cope with the current flood of helpline callers."
I wonder whether any amount of money will resolve that problem, but it is probably what is needed in the short term. Thirdly, he states:
"TNOs who provide numbers to repeat offenders should either have the level of their bond increased or their authorisation to provide numbers removed."
It should be the latter first.
In conclusion, it is interesting that the crime side of police forces so undervalues cybercrime. Police forces require training, and we need a specialist unit to teach and train policemen and women in different constabularies.
Michael Fabricant: Is the hon. Gentleman aware that in the United States a division has been established under the Department of Homeland Security to deal with that very issue? The US authorities not only recognise that there is a threat from cybercrime—actual cybercrime of the sort we have discussed today—but from cyberterrorism. At the moment the Government are doing nothing to counter that threat.
Mr. Wyatt: The wider issue is that any regulation made in the United Kingdom will lead to crime going offshore, and one can keep going offshore for ever. The G8 and the European Union should be creating a new world internet organisation that deals with cybercrime. One would not expect the UN or the World Trade Organisation—bless them—to deal with it, because they just are not up to it. We need a more nimble, smarter world body. I do not see such an initiative yet, but I hope that the Babbage institute may come.
I conclude by reading something from a note from Rob Johnson, who said:
"I am dismayed that there has been only one upheld complaint against Dialer fraud since February 1 by ICSTIS. I am led to believe that there is underlying 70 per cent. non-collection of levied fines."
If those companies are based offshore, the situation is difficult, but the whole process seems to be tipping over, and we need quick service to ensure that ICSTIS is brought back in line. In the longer term, we may need a new regime.
10.7 am
Mr. Richard Allan: I should like to follow on from the hon. Member for Sittingbourne and Sheppey (Mr. Wyatt) in talking about internet diallers. I offer my apologies to the Chamber because I also have to go to the meeting at the Home Office, at which we shall discuss the Computer Misuse Act 1990.
Mr. Deputy Speaker: Order. If I may, I shall interrupt the hon. Gentleman. Both the hon. Members for Sheffield, Hallam (Mr. Allan) and for Sittingbourne and Sheppey have fully used the courtesies of the House in advising myself, the Minister and the initiator of the debate of their need to be elsewhere at 11 o'clock. We are grateful to them for exercising the proper courtesies. I wish that were done more often.
Mr. Allan: I am grateful to receive such a ringing endorsement from the Chairman of the Procedure Committee who, above all other hon. Members, knows how things should be done.
I am grateful to the right hon. Member for North-West Hampshire (Sir George Young) for raising an issue in which I have been interested for a couple of years since first coming across diallers on my own computer and being horrified at their potential. I raised the issue during the passage of the Communications Act 2003. I come at the matter from three angles. First, there is the question of consumer protection of our individual constituents, about whom we are all concerned. Secondly, we need to tackle criminal activity and not allow spaces to exist within which fraud can be committed easily. At the moment, we have allowed spaces to exist within which fraud is far too easy. The right hon. Member for North-West Hampshire referred to the money flow chain as being critical to that situation.
Thirdly, there is the issue of maintaining public confidence in the internet, which is a concern shared by the right hon. Gentleman and the hon. Members for Lichfield (Michael Fabricant) and for Sittingbourne and Sheppey through our membership of the all-party internet group. We want to ensure that the internet is safe and that people in the UK feel comfortable using it. That objective is important, and rogue diallers are a potential disincentive for people to use the internet because they may have read in the paper about people running up massive phone bills.
ICSTIS has been helpful in briefing us, and it held a helpful meeting on the matter in the House last week. The Telecommunications UK Fraud Forum, to which one of my weblog readers pointed me last week, has also been helpful. It sent me some briefing material, including a helpful article on how to write one's own rogue dialler.
The ICSTIS briefing on the premium rate industry opened my eyes to what is going on. We have effectively developed a micropayment system based on the existing consumer credit arrangements organised by telecommunications companies, or telcos. The system is cheap to operate and permits services to develop that would not otherwise function. If one wanted to take 10p for a voting call through a credit card, many services simply would not be cost-effective.
We have different personal views about the value of the services offered; tarot readings online or over the telephone are not my cup of tea. However many are popular, as we have seen when there is a link with television programmes, and the public clearly demonstrates an appetite for them, spending about £2 billion a year on premium rate calls.
Although we have heard that there are wrinkles in the system now that the volume of services is increasing and SMS scams are taking place, voice services have developed quite constructively on the whole, thanks in part to the ICSTIS regulations and the nature of the activity itself. ICSTIS has tried to apply the same sort of disciplines to premium rate internet diallers and has developed a code of practice detailing that terms and conditions should be available on screen and that users should be fully aware of the costs. Premium rate voice numbers state the call rate at the bottom of the advertisement. ICSTIS has said that there should be an on-screen clock to tell users how much they are racking up, and that access to the site should automatically stop if the total cost of connection reaches £20.
If the code were fully implemented, there would be fewer problems. However, there are important differences between the architecture of voice and data premium rate calls, which make data calls more prone to fraud than voice calls and dodgy operators more likely to operate them. In a voice call, the user has to take active steps to initiate the call and to extend its duration. There may be a long spiel that in itself causes a problem, but the user chooses whether to stay on the line or terminate the call. The user manages the whole thing. With a data call, the computer does the managing, which can be entirely invisible to the user until the bill arrives. That is the critical difference; even for an expert user, there is no way of telling that the activity is taking place.
The ease with which such diallers can be produced is demonstrated in a helpful article by the Telecommunications UK Fraud Forum. We are told that production takes about 60 lines of code in a fantastic and very neat language called Perl. I will not read out those lines, suffice to say that it is shorter than most speeches that take place here and that in fewer lines I could produce something that would collect £1.50, £3, £30 off thousands of people throughout the country. It is that simple. The article tells us how to ensure that the user cannot see that the dialler is dialling, how it can turn off the modem so that it does not make a noise.
The points made by the right hon. Member for North-West Hampshire to set the issue in context were helpful. The question is about the existence of the industry at all. We must be clear that it would be unacceptable for us to say to constituents who have been ripped off by fraudsters, "There is nothing that can be done, mate." They will not accept that. The likelihood is that their number will increase; internet crime and fraud comes in waves and the wave of dodgy diallers is only just beginning. We can expect far more to arrive. The industry must act or the ultimate solution will be to pull the plug on premium rate calls. That much is at stake.
I would be interested in the industry's response to credit limits on land-line phone accounts. The average problem bill that is queried has an excess of £100, but that disguises many problems for individuals who have an excess of £500 or £1,000, as highlighted in the debate

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already. I see no reason why a phone company should allow someone to run up a £500 or £1,000 bill without any prior consent. I have a credit limit on my mobile phone account. I understand that mobile phone accounts operate with modern systems and that putting credit limits on all accounts would be technically complex and potentially expensive for BT's large system, but it should be on the agenda because unlimited, unbridled and largely unregulated credit is going out to people and that seems entirely unacceptable.
So, I question whether, as a matter of course, we should have credit limits on land-line phone accounts. If someone is a regular premium rate user and wants to extend their credit, they could come to an arrangement, much as they would with their mobile phone, to get a credit limit of £500 or £1,000. That is between the user and the company. I cannot see any reason why anyone should run up £1,000-worth of debt without the person offering that credit intervening at any stage, particularly when, on a normal residential phone line, the typical amount of debt might be £50 or, as a maximum, £100 per month.
In terms of consumer protection, the second point is that we should have a caveat vendor principle, rather than caveat emptor. The sellers ought to be aware that, if they do not provide the services properly, they will not get paid. That would create an incentive throughout the chain for people to make sure that things happen properly. A good starting point would be to say that the consumer should not be liable if they query charges that have been run up with a dialler that does not comply with the ICSTIS guidelines that operate in the UK for premium rate numbers.
If someone is operating a premium rate number and has not complied with all the points—turning it off at £20, having clear information online and so on—there should be no reason for anyone to have to pay that company because the company has failed to comply with the guidelines. That would lead to network operators making sure that they did not offer services to people who do not comply with the guidelines.
It may be that we have to move to a prior approval procedure, particularly in the internet field, where it may be the way forward. I understand why, because of the volume of voice calls and the nature of the voice market, we have moved away from prior approval to a situation where people set up numbers and, if there are problems, we deal with them later. However, because of the smaller volume of internet-related numbers and the architecture of the internet—space being difficult—prior approval may be the best option.
The caveat vendor principle should be applied. Many of those people are complete crooks and I find the idea that we are handing money over and UK reputable business is actively participating in extracting money from our constituents and handing it over to crooks so offensive. We must say that that cannot happen. We must find some way to deal with that.
That may result in an additional difficult problem— diversion to international and satellite numbers. We must recognise that. If we regulated all the 09 numbers there might be diversion to international and satellite numbers, but the fact that that is a difficult area does not mean that we should not act. Where we have things in
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our jurisdiction—premium rate numbers in UK number space are in our jurisdiction—the fact that we may get diversion to other areas is not an excuse not to act. We should clean up our 09 numbers. There are other issues that we need to resolve in dealing with international and satellite numbers.
My second area of concern is tackling fraud and doing it robustly. We should consider taking up the Computer Misuse Act cases for unauthorised access. Those should be taken up by ICSTIS or by consumer bodies and the Government should participate in that actively.
We understand that the Computer Misuse Act is moving back up the agenda and that the Government want to review it. My reading of the way in which it works is that if somebody plants a programme on to my computer without my explicit consent and that programme does things to alter the nature of my computer and my dial-up settings, that is a prima facie case of unauthorised access according to the terms of the Computer Misuse Act. I think that a criminal prosecution under the CMA would, in many cases, be far more effective as a discouragement for those who operate in the rogue dialler market than any fining that takes place through ICSTIS. So I hope that the Government are robust in making sure that CMA prosecutions take place.
I understand that a review of the fraud legislation is also taking place. There is a range of telecoms and internet-related fraud and we need to make sure that a new fraud Act—which I would welcome—encompasses telecommunications and internet-based fraud. If we are going to use micropayment systems in the future, all those micropayment systems, whether there are for mobile phone or land-line networks, will need to have the backup and support of a tough regulatory environment that deals with fraudsters.
The final issue that I want to consider is confidence in the internet. The most important thing is to stop fraud happening. There is also a strong role for education. Broadband removes the risk, but only if the modem is unplugged. If anyone using broadband finds that their connection becomes slow one day, there is often a good reason for that. Many people leave their modems plugged in as a back-up line. However, using broadband and not having a modem plugged in is a possible solution.
Locking down diallers would also help. It is popular in such debates to knock the relative lack of security of the Microsoft Windows operating system. However, it is also appropriate to do so, because it is a fact that that operating system does not lock things down in the way that other operating systems do. There is a good reason for that. Ease of use and security are always a trade-off. The easier something is to use, usually the less secure it is; the more secure it is, the harder it is to use. As a consumer operating system, Microsoft Windows is easy to use. However, in comparison with other operating systems, it is not very secure.
However, something can be done within that system. Users can be educated to lock down their diallers, so that people would need to have super-user administrative permission to replace one dialler with another. That is technically possible, but it is not done in most consumer environments. Education may encourage people to do that.
Michael Fabricant: I agree with the hon. Gentleman, but when someone knows that they are going to leave their computer unattended and on—incidentally, there is nothing to stop a rogue Trojan virus from switching someone's computer on; the potential is there—surely the ultimate safeguard is not all the software that he has been talking about, but simply unplugging the modem and disconnecting it from the system.
Mr. Allan: That is an option, but for most users in most households, who are still using a dial-up connection, it is quite unsatisfactory. Again, we are back to the trade-off between ease of use and security. I want to turn up, turn my computer on and go; that is ease of use. However, I can make my computer more secure by unplugging everything and checking it all. All that I am saying is that the balance needs to shift a little away from ease of use and towards security, on this and a whole range of other issues. People need to be told that that should be the case, so there is an educational role.
ICSTIS, which has been referred to repeatedly, is the front line. It has an important role; if I have a complaint, I phone ICSTIS up. At the moment, I probably will not get through. The telecoms industry needs to be realistic. If it values this part of its sector, it must put a hell of a lot more money into ICSTIS. It is as simple as that. It is the industry's responsibility to do so. There should be no excuse for the industry funding a regulator that cannot answer calls from our constituents who have queries about the way in which the industry is operating. The industry is very profitable. A lot of money is being made. It is the industry's choice; if it wants the business to survive, it needs to put money back in to ensure that it is clean, safe and works in a way that is publicly acceptable.
Let us think about the scale of the problem. BT is not the only telco that is affected; all telcos are. However, if BT has 19,000 customers with complaints and if each of those customers takes up only one hour of time—I am sure they all take up far more than that—by my rough calculations, we are talking about 10 person years just to deal with that lot. The problem is huge. Perhaps telcos have decisions to make about whether the business is worth conducting, given the potential losses and hassle that it causes them.
Like the right hon. Member for North-West Hampshire, I do not instinctively want to ban the industry. It can be very cost-effective, and can encourage all kinds of business to take place online, whether over the internet or over telephone lines. People want to engage in that. However the clear message is that if the industry wants to offer such services, they must be better regulated and we must ensure that there are no spaces for fraudsters.
Above all, we must ensure that our constituents are not confronted by huge bills that they do not understand and for which no one can give them an adequate explanation. No one can give them the certainty that that burden will be lifted from them because the area is deemed to be too complex. I hope that the Minister will give us some pointers today, although I recognise that a lot of the responsibility lies with the industry. However, the Government can heavily influence the direction that the industry takes from this point.
Mr. Deputy Speaker: We now start the winding-up speeches. May I make a plea to the Liberal Democrat spokesman and to Her Majesty's Opposition spokesman to sham some of the extra time, but leave adequate time for the Minister to reply? This is an interesting and technical Adjournment debate and the Minister must be given sufficient time to reply to it.
10.24 am
Malcolm Bruce: Mr Deputy Speaker, I am happy to accept your constriction on time. Many more expert speeches have been made before mine.
The right hon. Member for North-West Hampshire (Sir George Young) should be congratulated on highlighting a serious and current issue that is a growing problem. It needs to be addressed and he has, on behalf of his constituents, informed himself about the nature of the problem and some of the solutions. I do not envy the Minister, because he is under considerable pressure to come up with practical answers before the problem gets out of hand. My hon. Friend the Member for Sheffield, Hallam (Mr. Allan) is a considerable expert on the matter and said that it is totally unacceptable for us and our constituents to have money taken out of our accounts without our knowledge and transferred to people engaged in criminal activity. No Government can stand back and regard that as tolerable.
Instinctively, I think that it would be unfortunate if the industry had to be banned because of the activities of a minority, but if we cannot find solutions, that may be the result, which is all the more reason to try to find solutions. The industry has an obligation to find them because it is in the middle. BT is in the front line because, as the biggest single provider, it generates most hostility from customers about disputed bills. It is in BT's interest to have the matter resolved.
Although many services are legitimate and consumers are prepared to pay a premium for them, it is unacceptable that if people choose to log on to those services, they may find that they are being charged at a rate of which they have no knowledge or which is different from what they were led to believe. If their account can be accessed when they believe they have terminated it and further charges can be run up, that is a total abuse. It is another matter when people have gone nowhere near those services, but still incur charges because of a virus, e-mail or some other mechanism when they have exercised no conscious choice. That criminal activity is fraud and we must find a means of stopping it.
I am led to believe that the problems in Essex and one or two other parts of the country that have been mentioned may have been caused by people going round in the middle of the night, tapping into boxes and dialling a premium number several times, which then appears on a domestic bill in that area. An obvious solution is to make the boxes secure.
Michael Fabricant: The hon. Gentleman may be relieved to know that BT is moving to an internet protocol system for all telephony and it will be far more difficult for people to tap in to those boxes, although I doubt whether that is happening a lot at the moment.
Malcolm Bruce: I am happy to hear that. As my hon. Friend the Member for Sheffield, Hallam said, telecoms and internet fraud unfortunately move ahead faster than the enforcers, so another scam may arise. Another point that was made to me is that it is a dial-up problem and not an internet problem. Consumers do not make that distinction. If someone is surfing the net and closes a pop-up box that opened itself, that is an internet problem for those people. If we do not deal with the problem, people will not use the internet because they will not take the chance of such a thing happening. That would be unfortunate, because this fantastic information exchange service would become devalued if people were nervous of using it. That would be a retrograde development.
In a debate such as this, the Minister would not expect to be given the definitive answer. He has been given a number of suggestions and a number of indications of the scale of the problem. We are all interested to hear what the Government can do to respond.
My hon. Friend the Member for Sheffield, Hallam suggests some kind of micropayment credit system that would effectively limit the costs that people could incur. I wonder whether it is possible to have a system in which premium numbers are blocked. I know that BT offers that service, but to my knowledge it has at no time communicated to me, a BT subscriber and internet user how I might do that. I hope that it will be more proactive.
There may be another answer. Many people would say that the number should not be blocked all together as that will kill the business, but a way around that is to say, "It is blocked, but you can access it with an override and a password," so that it can be accessed only consciously and overtly, and so that the provider must give a clear indication of cost. I am not a technical expert, but I worry that people will find a way around that. Assuming that something along those lines could be a solution, it would be one way of giving people informed choice. No one would object to that; people object to being charged for a service that they did not choose to use, or to the fact that they exercised one choice and were inveigled into something more substantial than they realised.
My hon. Friend the Member for Sheffield, Hallam mentioned broadband and the caveats about people having to disconnect their dial-ups. That raises a question of which the Minister will be well aware, which has been asked by my party in particular, but not exclusively: how do we achieve universal broadband access? That is an issue in many constituencies; certainly in mine, if not my hon. Friend's. We welcome the fact that the internet is reaching more and more people, and is reaching out into rural areas, but there are still many rural consumers who will not get it for some considerable time, or may never get it. Such people will not be impressed by the Government telling them that the way to avoid internet scams is to get on to a service that they cannot access. BT says that its ambition is that there should be universal access, but it has not told us how it will achieve that.
There is also an issue with disputes and the total overwhelming of the system. It is slightly worrying that ICSTIS's starting point is to say that such problems are between the customer and the provider, although it then acknowledges that it must do more about the situation.
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That is an unequal contract; one is not really a customer if one has been illegitimately loaded on to something that one did not contract for. There has to be an acknowledgment that if there is an imbalance between customer and provider, any kind of regulator has to step in on behalf of the little guy. It may well be that we need some kind of independent brokerage that can second-guess, because BT and others are likely to say, "Well, we've contracted, we've paid. As far as we're concerned, you have accessed these services, so you must pay." They make things difficult for people who want to dispute what they should pay for.
Conscious as I am of the desirability of giving the Minister time to respond, I will raise one final issue; the broader case for solving the problem. I understand that the BT system almost came to a total halt after the World Trade Centre atrocity on 11 September 2001, because everybody was phoning everybody else. The system was nearly overwhelmed. It has been pointed out to me that it would be possible, with the technology available, for someone to set out to do just that with a virus; to make every number in the country dial every other number so that the system is completely locked out. One might do that for the sheer joy of mayhem. Strange as it may be, that seems to be the inspiration for virus anoraks. They do it not necessarily for gain, but to see the chaos that ensues. However, there are more sinister people who see ways of using that technology to block the whole system before mounting some kind of terrorist attack, so that emergency and other services may be disrupted because the system is in chaos.
Clearly, that would be an appalling scenario and I do not suggest that it is a prime reason for reforms, but considering the injustice to people who are billed for services that they did not access or did not access on the terms for which they are billed, that legitimate telecoms providers are taking money from our constituents and giving it to criminal elements, and the risk of a terrorist or viral attack on our system that could have serious consequences for national security, I hope that the Minister will accept that there is a growing concern about the issue.
I suspect that if the process continues to accelerate, and we debate the issue again in a few months, this Chamber will be full. I accept that technical constraints prevent the Government from solving the problem alone. However, they must, together with the industry, come up with answers; and soon, before it gets out of hand.
10.35 am
Michael Fabricant: This has been a remarkable debate, first, because it affects so many people and secondly, because there has been such unanimity about the problem and what needs to be done about it. The hon. Member for Gordon (Malcolm Bruce) is right; next time. there will be many more people here. The problem is growing, not decreasing. I very much congratulate my right hon. Friend the Member for North-West Hampshire (Sir George Young) on initiating the debate.
Some 2,000 cases are reported daily, as has been mentioned, and some 19,000 cases are under investigation. Clearly, ICSTIS has a great problem in trying to administer such a large volume of cases.

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Various hon. Members have suggested that the industry should provide more money for ICSTIS. However, the Government also have a role to play. My right hon. Friend the Member for North-West Hampshire came up with 10 possible remedies. We shall all be interested to hear what the Government can do, as ICSTIS does not have a huge remit to provide a solution. If one consults the ICSTIS website and asks:
"Do you have to pay for the calls to this number?"
the response is:
"Each telephone company has its own processes for dealing with disputed bills, so you must speak to them."
It goes on to say:
"ICSTIS has no authority to stop your telephone company (BT, Telewest, One-Tel etc) making you pay for calls or to postpone payment. On your behalf we have made your telephone company aware that we are investigating the service on the number(s) listed and we will advise them of the outcome in due course."
And what does it say is the solution? It says that people should write to Rik Covell, at an address in the British Virgin Islands. I suspect that Rik Covell, whoever he might be, will not respond. If ICSTIS cannot respond to letters from a Member of Parliament because it is so flooded with complaints, I rather suspect that Mr. Covell will not respond either, but for different reasons.
The issue is serious, for the reasons identified by the hon. Member for Sheffield, Hallam (Mr. Allan). It is not just a matter of voice calls; one could well say of those "caveat emptor", because there is a clear obligation on premium rate number suppliers to make it clear how much calls cost. One might have to control one's household, particularly if it contains young children who make calls. The short-term remedy could be for a householder to have 090 numbers barred. Incidentally, the hon. Member for Gordon asked how one could bar an 090 number. Anybody who wishes to do so should go straight to bt.com; the website gives very clear instructions. However, that is the ultimate sanction. As hon. Members have pointed out, many premium rate operators are legitimate. It is a great shame that their services should be barred simply because of the illegality of others.
I am concerned by the other issue, however, which my right hon. Friend the Member for North-West Hampshire raised and which the hon. Member for Sheffield, Hallam discussed; the issue of the rogue dialler that infects itself on to a computer. I strongly believe that that is a prime example of where the Government should use the Computer Misuse Act 1990 against operators in the UK. I received a list of some of the companies under investigation from ICSTIS. I shall not name them, but I shall say where they are based: Germany, Switzerland, Lichtenstein, Florida, Spain, Moldova, Panama and the British Virgin Islands, which I have already mentioned. However, some British companies are involved too, so the Computer Misuse Act 1990 could apply. Has the Minister spoken to the Director of Public Prosecutions to see whether prosecutions will be initiated under that Act?
Mr. Allan: Just to be clear, the Computer Misuse Act 1990 can be used against people based abroad. Higher order offences, such as gaining unauthorised access in
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order to commit fraud, carry a sufficient penalty to be extraditable. We have pressed the Government to extradite people. Just as the US would extradite people from the UK who hacked systems there, we should do the same with people in other countries.
Michael Fabricant: The hon. Gentleman raises an interesting point. How seriously does the international community regard such crime? The problem is that, despite the fact that 19,000 cases are under investigation, the Government—I am not condemning them—do not yet regard the issue as serious enough in their order of priority. However, the problem will be serious, as the hon. Member for Gordon said, when in the months to come we debate in the House the hundreds of letters that we receive each week from people whose computers have become infected.
My right hon. Friend the Member for North-West Hampshire has come up with 10 possible remedies. Some of them are extreme, but others are practical. Should the main telephone provider withhold payments? For example, it is extraordinary that BT has to pass on payment to premium rate providers within 14 days and yet does not receive income itself for up to four months. What a negative cash flow!
Withholding money would be an effective sanction. If BT could withhold money to premium rate suppliers following serious misuse, particularly with pop-ups and infections, which I believe would be a prima facie case for withholding such money, there would be a great incentive for those suppliers not to breach the Computer Misuse Act 1990. At the same time, however, we must be careful, because BT and other telephone companies, such as NTL and Telewest, cannot become judge and jury and withhold money unilaterally. There must be clear prima facie evidence of infection. I would be interested to hear what the Minister has to say about that. What guidance will the Department of Trade and Industry give telephone companies regarding that issue?
The difficulty is a manifestation of the much wider problem of internet abuse in general. The problem is similar to the situation that existed not so long ago with the copyright Acts We all accept that there should be intellectual property rights, yet China was abusing copyright, producing music and software CDs, and so forth, and not paying any copyright fees at all. It took many years to change that. Only recently, when China joined the World Trade Organisation, did it finally accept that it had an international obligation.
Some 50 years ago, the British Government initiated the first world administrative radio conference, which was a recognition that unless countries came together and recognised that they could not abuse radio and television frequencies, there would be mayhem and anarchy. One could be watching the 10 o'clock news on the BBC or ITN, and suddenly there could be an interruption from a rogue broadcaster in France, beaming pornographic programmes across to Britain. Of course, that does not happen because there is international recognition of the methodology by which countries come together to control radio frequencies.
The Government have a duty of care to the worldwide community, not only to people in the United Kingdom, to initiate a similar conference on controlling the internet. I accept that, in theory, the Computer Misuse

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Act 1990 might result in extradition. However, until we get worldwide agreement that all nations must cooperate, there will be mayhem on the internet, just as there could have been mayhem on broadcast frequencies.
I want to allow the Minister plenty of time to reply. This is an important problem, and there are some interesting solutions. I shall be very generous and not use the rest of my speech, as the issues have been covered so well by other right hon. and hon. Members. I look forward to hearing what the Minister has to say.
Mr. Deputy Speaker: We are grateful to the hon. Member for Lichfield (Michael Fabricant).
10.46 am
The Minister for Energy, E-Commerce and Postal Services (Mr. Stephen Timms): I am grateful, too. I congratulate the right hon. Member for North-West Hampshire (Sir George Young) on securing this debate. The contributions that he and others made have highlighted the scale of this serious problem. I am not quite sure what he was referring to when he described the firewall with which I am protected, but I am grateful to him for taking the trouble to let me know beforehand the points that he would raise in this debate.
The premium rate services industry has been one of the successes of the communications revolution. We have heard about several services, from interactive voting on "Big Brother" to getting new ring tones on mobile phones—hon. Members may be aware that the UK ring tone market is now larger than the singles market—and new internet-based services. Such services make up a successful market that was worth more than £1 billion last year, making the UK the biggest market in the world for services of that kind.
I agree with the hon. Member for Gordon (Malcolm Bruce) that, if the market is to continue to thrive, it is absolutely essential that consumers are confident that they can use such services without becoming the subject of a scam or a fraud. The calls this morning to pull the plug on the market will only increase if the problems are not swiftly addressed.
My hon. Friend the Member for Sittingbourne and Sheppey (Mr. Wyatt) drew attention to a letter that he had received from the Network for Online Commerce. I also received a letter from it that made some interesting points. I understand that a small number of the companies causing the problems are, in fact, members of that organisation. Any organisation that represents this industry must ensure that its members are innocent of the kind of practices that we have been discussing today, as such practices undoubtedly pose a serious threat to the industry. Everybody in the industry with any sort of responsibility must ensure that participant companies rapidly address the matter.
As we heard, premium rate services are regulated by ICSTIS through a code of practice that is underpinned by Ofcom. The Communications Act 2003 contained provisions to ensure that the ICSTIS system of co-regulation of the advertising and services would continue to be supported. The Act contained for the first time a reference in law to the ICSTIS code of practice. ICSTIS is an independent body, with sanctions ranging from —100,000 fines to the disconnection of service
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providers that breach its code of practice. ICSTIS frequently uses those powers and it has a good record of using its emergency powers swiftly and decisively to stop abuses linked to premium rate services.
The right hon. Member for North-West Hampshire asked whether I stood by the comment quoted in the ICSTIS newsletter of June 2003. Yes, I do. The model is a good one, but ICSTIS has struggled to cope over the past few months with the volume of complaints that it has received, and it has recently seen a big increase in the number of complaints about internet dialler services. We are taking the problem seriously; the industry, too, needs to take it seriously. Last week, ICSTIS provided a parliamentary briefing that was chaired by the hon. Member for Sheffield, Hallam (Mr. Allan). Others referred to that valuable briefing.
As we have heard, the services link premium rate numbers to diallers. A dialler is a small piece of software that, when downloaded to a PC, temporarily replaces a user's normal internet service provider connection—typically a local rate 0845 number—with a premium rate number.
Michael Fabricant: The Minister is right to highlight the role of ISCTIS. Like him, I agree that self-regulation is better than Government regulation if it is effective. Does he not accept that ICSTIS is completely overwhelmed by the number of complaints? The current situation will not do. If people cannot get through to ICSTIS to complain, the organisation will become impotent.
Mr. Timms: ICSTIS has certainly struggled with the volume of complaints in recent months. I shall say in a moment what might be done to deal with that, but the strongest message that today's debate should send the industry is that it needs to clean up its act. Otherwise, its future is in peril.
When a dialler works well, it enables a content provider to charge a micro-payment for content without the need to resort to credit cards. Charges of up to £1.50 per minute are made to the user's phone bill. As we have heard, the vast majority of those services are not fraudulent. However, there have been cases of internet diallers replacing a user's ISP connection without the user's knowledge and without the user having to take action to download the dialler. As a result, users may not be aware that they are connected to a premium rate number when using the internet.
That sort of scam can result in users realising that they have been ripped off only when they get their next phone bill. As we have heard, given BT's usual billing cycle, that is often not for another three months. Those charges are typically about £100, but they are sometimes much more. Not all those scams involve premium rate numbers, as some operate on international or satellite numbers, but the premise is the same—to run up charges to consumers that are passed on through the telephone billing system.
Some hon. Members have pointed out that, so far, such scams are not a problem on broadband. However, as the hon. Member for Gordon pointed out, that is not much comfort if broadband is not available. None the less, as more than 80 per cent. of households now are within reach of a broadband service, internet users may want to take note of the fact.
Those scams may be in breach of the Computer Misuse Act 1990. They may even be straightforward fraud. They are certainly in breach of the ICSTIS code of practice, and the organisation has been taking strong action against them. ICSTIS has passed details to the hi-tech crime unit. It has fined several companies a total of some £300,000, and it has many more complaints in the pipeline.
ICSTIS has been inundated with complaints about dialler services, and is receiving thousands of calls a day on the subject. However, it is important to put that into perspective. Most complaints are from people who do not understand how internet diallers work, and who are unaware that that their monthly ISP charges do not cover access to premium rate internet services. Some complainants raised the issue of unauthorised use where someone in the household has used the services without the knowledge of the family member who pays the phone bill. However, there is no doubt that a significant number of consumers have been the subject of scams and faced charges of £100 or more on their phone bill for services that they simply have not used.
Malcolm Bruce: I appreciate what the Minister is saying, and of course the providers will say, "You have used these services and you should pay," but does he not agree that we must get to the bottom of the scams that connect people many times over or do not give any information? How do we deal with people who may have knowingly accessed a premium rate service but are charged many times the amount that they expect?
Mr. Timms: I agree with the hon. Gentleman. Ofcom is working closely with ICSTIS to analyse solutions to the dialler problem and examining the role of the terminating networks that have contracted with the service providers in order to carry the service. Where there is evidence of network non-compliance with ICSTIS rules, Ofcom will investigate and take appropriate enforcement action, including fining providers where necessary.
Ofcom is also writing to the terminating networks that have contracted with premium rate service providers, which the right hon. Member for North-West Hampshire mentioned, to set out its strong concerns at the lack of due diligence demonstrated by certain
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companies in signing up service providers in the first place. They must check that the providers with which they contract are bona fide service provider organisations. Ofcom will not tolerate that activity, and it is investigating the role of those providers with a view to taking enforcement action.
ICSTIS is building cases that suggest that a small number of terminating networks are not complying with the obligations in its code of practice. It is collecting evidence to support that claim and will shortly pass it to Ofcom to consider what action to take, including prosecutions. I hope that as soon as that information is received, Ofcom will move swiftly.
Ofcom is asking several of the larger telephone service providers to explain their position on making customers pay for disputed bills where fraud is suspected. It will point out that they must act in accordance with the conditions imposed upon them relating to non-payment of bills. The conditions prevent operators cutting off customers where a dispute over a premium rate service bill is being investigated.
We heard from the right hon. Member for North-West Hampshire of a case where one provider had cut off a customer while their case was being investigated. That is a breach of the conditions that Ofcom imposes on the service providers, as I understand them. BT will make an announcement later today about the additional steps that it will take to address that serious problem.
My Department is working with ICSTIS, Ofcom, the industry and the Internet Service Providers Association, UK to raise awareness of what consumers can do to protect themselves from dialler fraud with increased use of firewalls and filtering software on their PCs. We have heard several remedies this morning, and anti-virus software is often available free of charge from internet service providers. Consumers can ask their telcos to block access to all premium numbers if they are worried about falling victim to those scams.
We are working with all those involved to ensure a coordinated approach to help consumers. Following last week's briefing, ICSTIS plans to bring together all the key players together next month to co-ordinate the work to tackle the problem. I hope that there will be a great deal of co-operation between everyone in the premium-rate industry, Ofcom, Government and ICSTIS to ensure that consumers are not exposed to that unacceptable face of the communications revolution.

Affordable Housing (South Gloucestershire)
11 am
Mr. Steve Webb: The Minister will have done his homework. He will know that this is not the first time that a debate with this title has taken place in this Chamber. I secured such a debate in November 2001, because after four and a half years as a Member of the House, I found that the lack of affordable housing to rent or buy in my constituency was one of the most significant problems brought to my attention by my constituents, week in, week out. I wish that I were not bringing the same subject back here today, but I make no apology for the fact that I am doing so, because the problem remains very serious for my constituents and not enough progress is being made. If anything, the situation is worse for my constituents than when I first raised the issue.
I want to link two closely related aspects of the lack of affordable housing. We use that term to mean houses that people can afford to rent and houses that people can afford to buy. Different groups of people are affected, but the issues are closely connected, as the Minister knows.
In south Gloucestershire, just over 5,000 households are on the council waiting list and 500 households are accepted as homeless each year, give or take a few. The statistics on trends are difficult to interpret because the council cleared out its housing waiting list numbers, which means that they have been volatile, but even in 2002–03, well over 1,000 households were added to the council's waiting list. The problem is very significant.
As the Minister knows, the council undertakes its own housing needs surveys, the most recent of which was in 2003. To show the scale of the problem, the council has calculated that if every house that is due to be built in the remainder of the local plan period t p to 2011 were an affordable house, the waiting list still would not be cleared. That is the scale of the problem; if every house were an affordable house, people would still be waiting for affordable housing. In practice, the number of affordable houses provided will be a fraction of that amount.
There is a massive problem with affordable houses to rent or to buy. The rate of owner occupation in south Gloucestershire is high in comparison with the rate nationally. Not only have average house prices risen substantially in south Gloucestershire—up 74 per cent. from a typical £92,000 in 1999 to a typical £160,000 in 2003—but those at the bottom end of the market have risen even faster. Those are the houses in what is called in the jargon the lower quartile—the starter homes. The price of the properties to which people in search of an affordable home are looking have gone up from a typical £62,000 in 1999 to a typical £115,000 in 2003. That is an increase of 85 per cent.
That situation affects young people in south Gloucestershire who are in work and want to leave home and buy a house. In the relevant period, their wages have risen by roughly a quarter on average, but the price of starter homes has risen by 85 per cent. Those people are desperate to get a foot on to the housing ladder, which has a knock-on effect on the council's waiting list.
The council told me this morning that a third of the households accepted as homeless in south Gloucestershire in the past year were working households. One may entertain a mental picture of the people who are accepted as homeless, who may depend on benefits or have lost their job. Yet a third of the people accepted by the council as statutorily homeless are in work. In other circumstances, they would have been buying their home, but because the housing market has gone crazy, that is not an option for them.
I am sure that the Minister is an expert on housing and that in his constituency, at the other end of the micro-scale, he is as much visited as I am by people with housing problems. I shall not go into too much detail on any case, but I have spoken to expectant mothers housed in first-floor maisonettes who have to lug a young child in a pram up the stairs to the first floor when they are seven months pregnant. It is totally unacceptable that people live in those conditions. I meet adults who sleep night after night, month after month and year after year on the sofa or the floor because their accommodation is overcrowded and there is nowhere else for them to go. I come across marriages that have broken up, mental health problems and disrupted education, all of which are the human face of the statistics that we will discuss today.
It is rare to hold a surgery without seeing someone with a housing problem. Every Friday night after my surgery, I go home and thank God that I do not have such a problem. I know how much I value secure, permanent accommodation for my children and my family, as I am sure the Minister does, yet thousands of people in south Gloucestershire simply do not have such security. They can sometimes get into temporary accommodation, but may then have to wait years before permanent accommodation becomes available in the area in which their children go to school or in which they have family networks. That is a source of misery to thousands of my constituents. The problem is not going away; if anything, it is getting worse.
Clearly, there are things that councils can do. When I raised this issue in November 2001, the then Parliamentary Under-Secretary for Transport, Local Government and the Regions, the hon. Member for Northampton, North (Ms Keeble), said that the council should ensure that more of the houses that are built are affordable. I agree. She failed to appreciate, however, that much of the house building in south Gloucestershire is not infill building, but the building of dirty great estates and thousands and thousands of houses. A problem with that approach is that developments such as Bradley Stoke or Emersons Green require massive amounts of infrastructure. In effect, the council is telling developers, "We'd like a primary school, a road junction and maybe a play area and a community hall. We'd also like subsidised transport. Oh, and we'd like 30 per cent.-plus affordable housing." The developers say, "Well, you can have some of that, but you can't have all of it."
It is true that a local authority that is making marginal increments to housing stock can be really go in hard and demand high levels of affordable housing, but a local authority that is absolutely strapped for cash or near the bottom of the funding league tables—we can argue about the numbers—is in a weak position to demand

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very high levels of affordable housing if it is also trying to secure a large amount of infrastructure. That is an obvious tension.
I am pleased that my Liberal Democrat colleagues on South Gloucestershire council want a target for affordable housing in new developments not of 30 per cent., but of 40 per cent.—a target with which I believe the Labour group is sympathetic. I would like progress to be made along those lines, but that target is massively removed from the reality of what is actually being delivered. A tiny fraction of the new housing is affordable. The 40 per cent. target is almost a fantasy figure. The proportion that is actually being delivered is a tiny fraction of that level.
The council is also considering reducing the scale of development to which the rules would apply, and it is starting to insist on quite small developments as well as the large ones. Some argue that the developers will not be able to make enough profit if the target is 40 per cent. I do not accept that argument. We have to get tough with the developers. Huge amounts are being made from building houses in south Gloucestershire, but not enough of the right sort of houses are being built at the right sort of price for the people who live there.
The council has a responsibility in this matter, and I pay tribute in passing to those in the local authority who work to address people's housing needs. That is not a job that I would want to do; having to tell people year in, year out that the council is continuing under the right-to-buy scheme to sell off far more houses than the housing associations are building. Between 1998–99 and 2002–03, the number of houses in the area under local authority control fell by about 250, while the number of houses under housing association control rose by only 100. Right-to-buy sales are not being replaced by housing association properties on the necessary scale. The supply is falling while the demand grows. Demand is rising because young families cannot afford to leave their parents and buy a first home and because of family breakdown. Demand is rising all the time, yet the supply seems to be shrinking.
What can central Government do? Clearly, central Government determine the amount of the money that the subsidised housing sector in the region receives. I gather that growth in Government support has been slower in the south-west than in other regions, yet the housing situation in the region is arguably one of the worst in the country, as the ratio of house prices to earnings is about 7:1. I gather that that is arguably as bad as the situation in London, and worse than anywhere else. Across the south-west as a whole, wages tend to be relatively low, but house prices have been rather high. I am sure that the Minister will tell us of the millions, hundreds of millions or billions of pounds that are being committed, promised or whatever. I hope that they are being committed, and I hope that they will deliver. All I can say is that on the ground over the past seven years, I have seen the problem getting worse and not better.
I talked to the local authority about what would help it, and it is keen to look at ways of promoting what it calls an intermediate housing market—something between the extremes of pure renting and pure buying. There are already examples of such an approach,
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including shared equity schemes and so on, but the authority has given me some examples of where someone can be delivered off the waiting list for less subsidy than a traditional council house would require.
It is possible to rent at below the market rent with some subsidy allowing people to save money for a deposit so that they can buy somewhere. That gets people off the housing list, but does not cost the full subsidy of a council house. A shared equity property is another option, where people pay the interest on the mortgage but might not pay any rent to the social landlord. That is cheaper than a subsidised council house, but it gets someone off the waiting list.
My local authority would be keen to promote such schemes and to be innovative. One of the problems is that it is quite resource intensive to offer every individual a whole menu of options involving different combinations of renting, buying, subsidy, equity and so forth. I believe that the local authority is in the process of putting in funding bids to get support to tailor housing solutions to individual need. If authorities can offer something other than pure social renting, pure council housing or pure housing association provision, the subsidy can spread further and deliver more houses for the same amount of public money. I would be grateful for any encouragement from the Minister on that front.
My local authority would welcome greater powers over empty properties. The Minister will know how grievous it is for a homeless family to know that empty properties are sitting empty month after month, year after year, not only in the public sector, but in the private sector. The authority would be interested in the power of compulsory leasing for long-term empty properties.
The council is keen to see private renting encouraged. In south Gloucestershire, the current situation is likely to discourage private renting for two reasons. First, housing benefit processing remains slow. Obviously, the council needs to sort that out, but it is a disincentive to private landlords.
I do not know whether the second problem is a nationwide one, and would be grateful for the Minister's comments. My local authority says to people who are coming to the end of a private sector tenancy, "Do not move out. If you know that your tenancy is up in a month or two months, and your landlord says that they are going to sell up and that they don't want to renew your tenancy, we are not interested until you absolutely have to leave. Do not go when they ask you to, do not go when they tell you to, wait until there is an eviction notice and they have taken you to court to force you out. Then we will treat you as homeless." As there is nowhere to put such people, they are made to stay for as long as they possibly can, well beyond the point where they might reasonably have moved out. Landlords are coming to me saying, "This is a disgrace. We are being encouraged to rent properties to people and then we cannot get them out at the end of the tenancy, because the council is telling them to stay put."
I know why the council is saying such things; there is so little property into which people can be moved that if someone physically has a roof over their head, the council has to accommodate them for one less night. That is a desperate situation. It is unfair on the tenant

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and the landlord, and for that matter the council. Is the Minister aware of that situation, is it happening elsewhere and can something be done?
Clearly, there have to be more houses, but in an area such as south Gloucestershire, which has significant green belts and villages that would lose their character if there was urban sprawl, it is all the more important that the houses that are built are those that local people can afford and that meet their needs. As the Minister knows, we need housing development of the right sort. High density housing does not have to be unattractive or undesirable. We can consider the issue of housing density.
We have to consider greater use of brownfield sites, but it is critical to ensure that it is not the developers who win, but local people. We have to bite the bullet. The only way to get enough affordable housing for local people is to ensure that when those new houses are built, a much higher proportion are homes for local people at the prices that they can afford. That is vital.
I have heard the Government say that millions and billions of pounds are being spent on housing, but I have not yet seen any evidence of that. Perhaps the serious money is yet to come through. Judging by what I see week by week in my surgery, however, it seems that the problem is getting worse. I hope that the Minister can reassure me that I will not have to be back here in another two and a half years to raise the same topic.
11.15 am
The Minister for Housing and Planning:
Let me begin, as is conventional, by congratulating the hon. Member for Northavon (Mr. Webb) on securing the debate and bringing the important subject of affordable housing in south Gloucestershire to the attention of the House. I know that it is of concern to you, Mr. Deputy Speaker, as it is, indeed, to us all.
The hon. Gentleman made several interesting proposals, on which I shall reflect; that is, after all, the purpose of such debates. Of course, some of his suggestions are already on the Government's agenda. In particular, we recently tabled amendments to the Housing Bill in support of the compulsory leasing of empty homes.
I know from the many representations that I have received from hon. Members and from the debates to which I have responded how urgent the issue of affordable housing is in the south-west. That is why I was happy to speak at the parliamentary launch on 24 March of the National Housing Federation—South West report on the economic effects of the affordable housing crisis in the south-west. That is also why I visited Cornwall to talk to people first hand about these issues.
The fact is that the south-west has experienced a near doubling of average house prices since 1999, with growth across the region and in south Gloucestershire continuing at 12 per cent. between the end of 2002 and the end of 2003. At more than £176,000, average house prices in the south-west are now the fourth highest in the country. Earnings in the south-west are below the national average, so measures of average house prices have reached more than seven times average earnings—a wider ratio than anywhere else in the country, except London.
Of course, such house price growth increases the wealth of many existing home owners. Nevertheless, we recognise that it can also create severe difficulties for people who are unable to buy or access housing at an affordable price to suit their needs. That can not only have distressing social consequences, such as increases in homelessness and the use of temporary accommodation or overcrowding in households, but create recruitment and retention problems for key public services. That is why the Government have made the provision of more affordable housing, especially for key workers and young families, a key part of our sustainable communities plan.
The hon. Gentleman graphically described the problems experienced by certain constituents in accessing social rented housing and affordable homes, and I have great sympathy for families facing difficulties in securing suitable accommodation. The latest south Gloucestershire housing strategy reports that the number of those on the housing register is expected to rise by about 240 each year. As he noted, 500 to 550 cases of homelessness are already being accepted—up from about 400 in 1999–2000.
Clearly, there has been little, if any, improvement in the imbalance between the supply of and demand for affordable housing in the hon. Gentleman's constituency since he last raised the issue in the House in November 2001. In responding for the Government in that debate, my predecessor, my hon. Friend the Member for Northampton, North (Ms Keeble), pointed to South Gloucestershire council's poor record in providing affordable housing, and the hon. Gentleman alluded to that point. Unfortunately, I have to report that the council's record on providing affordable homes remains disappointing. Although about 1,000 homes a year have been built since 2000–01 and the council is on target to build the number of homes required in the local plan, only a mere 127 of them have been affordable units, which constitute about 12 per cent. of the total new build, whether funded by housing associations or through planning gain. Indeed, only 66 affordable homes were secured through section 106 planning gain agreements in the two years between 2002 and 2004. That is the case despite the council's declared policy of securing 30 per cent. affordable housing on sites with more than 25 units in urban areas and sites with more than 15 units in rural areas.
I am encouraged to learn, however, that South Gloucestershire council is anticipating a substantial increase in the use of section 106 agreements and developer contributions over the coming years to secure the delivery of more affordable housing units and supplement other projected completions on non-allocated or non-windfall sites. If that approach were successful, it would bring the average rate of additional affordable housing provision to around 200 units per year, which would be a 100 per cent. increase, although the level would still, of course, be below the council's own targets. I am also encouraged that south Gloucestershire jointly led the recent housing market assessment for the wider west of England area.
The housing study is the first of its type to be published in the south-west and is an excellent example of partnership working, not only between neighbouring unitary authorities of the west of England—the former Avon area—but with private developers and landlords,

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the regional development agency and tenants. The thrust of the study's 24 major recommendations is to increase partnership and proactive working in housing and planning between the unitary authorities in the west of England to drive much-needed improvements in the delivery of housing to accommodate employment and population growth in the area. I am pleased that the west of England partnership is considering how best to rise to that challenge and I look forward to significant progress in the years to come.
The Chancellor will announce decisions on future affordable housing investment in the spending review in the next few days, but I am proud of the Government's record of investment to date in improving the quality of social housing through the decent homes target and by increasing the resources for the Housing Corporation to more than £1.2 billion in 2003–04. That has meant, for example, that 48 key workers in south Gloucestershire were able to take part in the national starter home initiative between 2002 and 2004.
Recognising the level of need in the south-west, the Government have increased the south-west housing board's grant allocation by no less than 30 per cent. over the next two years, which is among the highest increases in allocation. From the recently announced £188 million investment programme, south Gloucestershire is due to receive £6.4 million to provide 229 additional affordable homes. They include 27 units for nurses, health workers and teachers from the £10 million south-west key worker challenge fund. South Gloucestershire council also received £2.1 million for investment in social housing and other capital investment for 2004–05 and 2005–06.
It is important that the south-west owns the agenda and seeks its own solutions. That is why we have set up the regional housing boards, which will give the region a real opportunity to identify its key housing priorities and to create its own response within a coherent national framework.
Affordable housing is the south-west housing body's No. 1 priority. It announced on 24 March how its £188 million will be invested during the next two years to deliver more than 65,000 affordable homes. Some 20 per cent. of that funding will be used to support a range of low-cost home ownership schemes, such as shared equity and Homebuy. Those are the sort of opportunities that the hon. Gentleman identified in his speech.
I am aware that south Gloucestershire includes an extensive rural area, so I am pleased to say that the current regional investment programme exceeded its target of providing 764 homes in villages with a population of less than 3,000 by allocating £33 million to provide 863 homes.
The Chamber should also be aware that we are working with local authorities to stop families being housed in bed and breakfast accommodation, except in emergencies, from March 2004, and to sustain the reduction in rough sleeping so that from 2002 onwards it remains at or below two thirds of the 1998 level. In 2003–04, the south-west received £4.4 million to tackle homelessness and rough sleeping, with south
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Gloucestershire receiving the sixth highest amount in the region after Bristol. Exeter, Plymouth, Gloucestershire and Bath.
At national level, the Government have strengthened the hand of local authorities in seeking to secure affordable housing through the planning system. We are clear that any development should ensure that communities are sustainable and should enhance the overall environment and protect the countryside. We must ensure that we get a better mix of housing that reflects the needs of everyone, and not just the market for large detached housing. We are therefore consulting on changes to planning policy guidance note 3 on the location and density of housing to widen the range of housing opportunity in terms of size, type and affordability. We are determined that the planning system will enable the provision of new homes in the right place—focusing on brownfields first—and at the right time to meet planned numbers. The purpose of the new Planning and Compulsory Purchase Act 2004 is to make the planning system faster and fairer.
The Government are also committed to responding by the end of 2005 to the recommendations of the Barker report on reform to the planning system, and are due to consult shortly on the proposed integration of regional housing and planning bodies.
Mr. Webb: I will want to show what the Minister and I have said to people who come to me who are desperate for housing and face a multiple-year wait. I am trying to get to the kernel of what he is saying. Is he saying that we should wait and see whether the Chancellor comes up with extra cash? The Minister was gracious enough to admit that not much progress, if any, had been made during the past three years, and the council would say that things have got worse. What have we learned from the past few years? What optimism can I give to people in desperation who come to see me? Should I tell them that I hope that there will be some more money, and that it will filter through eventually? Is there anything more concrete that I can tell them?
Keith Hill: I have already pointed out to the hon. Gentleman that, in the next two years, the regional housing board for the south-west will receive one of the highest increases in allocation of grant for social housing purposes. That is an overall increase in grant of 30 per cent., from which south Gloucestershire will undoubtedly benefit
The Government recognise the pressures on the housing market in the south-west. The hon. Gentleman is absolutely right that it is a special area. Earnings are generally quite low the region, but it is experiencing enormous growth in the amount of equity put into housing because it is an extremely attractive region to which people want to retire and in which people want to have second homes. The extra investment going into the region from private buyers has a knock-on effect on the availability of affordable housing. We recognise that that is the case, which is why we are increasing grant for social housing in the region and are committed to increasing investment in social housing. We hope to reflect that approach in the spending review announcements.
The hon. Gentleman will be aware that, via our planning reform agenda, we are hoping to remove impediments to housing growth, which some have

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argued have been created by the planning system. We are also committed to major new house building in order to stabilise the rise in house prices as far as possible. He can use that evidence plus the specific details that I have given to offer some comfort to constituents who find themselves in a very difficult position. I recognise their difficulties. He used to reside in my constituency and he knows the sorts of pressures that can arise in London. We recognise that the south-west shares many of the pressures of London and the south-east, which is why we seek to respond to them.
It is important that the region should own its solutions, so the Government are providing the tools and resources to enable regional partners in the south-west to deliver the higher quantity and quality of housing that the community needs. My Department's key objective is to create sustainable communities in all regions. Today's debate has been an excellent opportunity to reinforce the Government's commitment to a better future for the south-west, and I commend our policies to the Chamber.
11.29 am
Sitting suspended until Two o'clock.

Transport (Eastern Region)
2 pm
Mr. Patrick Hall: I am delighted to have the opportunity to raise a number of issues relating to transport in the eastern region. I am also pleased to note the presence of several hon. Members from the region. My hope is that the Under-Secretary of State for Transport, my hon. Friend the Member for Harrow, East (Mr. McNulty), will hear a number of worthwhile contributions that will leave him in no doubt that the eastern region has strong advocates, and that the needs and aspirations of its people should be heard, recognised and acted on by the Government just as much as those of people from other parts of the country.
It has not always been so. I note that the debate on the eastern region that took place in the House on 11 November 1998 was, according to the House of Commons Library, the first debate on economic development issues relating to the east of England to have taken place for at least 20 years—the Library did not look further back. It was followed by another Adjournment debate, on transport in the eastern region, on 20 November 2001, which was secured by my hon. Friend the Member for Luton, North (Mr. Hopkins). I pleased to see that he is present this afternoon. Taking into account today's debate, the eastern region is getting a lot more parliamentary attention than it has received for a very long time indeed.
In addition, the creation of regional development agencies and regional assemblies across the country has focused the minds of business, the Government, organisations, institutions and elected representatives on issues that are best considered and delivered in a regional context. Again, that is something that has not happened with regard to the east of England in the past.
Although the region is new and diverse, recognition of its existence—including, increasingly, by its residents—will help to deliver the necessary clout to ensure that it gets its fair share of the cake, as well as helping it to develop the self-confidence to do things for itself. If anyone has any doubts about the need for that, I ask them to consider the challenges and opportunities in the sustainable communities plan, particularly in the London, Stansted, Cambridge and Peterborough growth area, and, on the western borders of the region, the Luton, Bedford, Milton Keynes and south midlands growth area.
The eastern region has one of the fastest growing populations in the United Kingdom. There are currently about 5.5 million people living in the six counties of Bedfordshire, Cambridgeshire, Essex, Hertfordshire, Norfolk and Suffolk. In land area, it is the second largest English region. Although it is characterised by historic, attractive villages and small and medium-sized market towns in an extensive rural setting, it must not be forgotten that most of the population is urban, particularly in the southern and western parts.
Commentators often refer to the prosperity of the region. It is one of the most prosperous in the United Kingdom, although it is only averagely prosperous in European Union terms. That prosperity is based on gross domestic product per residence, which allows for income brought into the region by commuters to London. However, if we measure prosperity on a

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workplace basis, the region falls well below the UK, as well as the EU, average. That indicates two key features of the eastern region: first, it relies heavily on London and, secondly, it performs below its economic potential as a region in its own right.
Some may say that that does not matter and the London effect should be welcomed, but that means maintaining and reinforcing the increasingly congested and costly radial transport flows into London. That approach is no longer sustainable, and it is undesirable in terms of quality of life as well as social and economic development. Indeed, although the London effect worked well for many people in the past, it always failed to tackle the fact that there are extensive pockets of relative deprivation, including rural deprivation, and a greater reliance on the car than in other regions because of the weakness of the public transport system and the lack of local employment opportunities. The 20 per cent. or so of households in the region that have no car, and the many people who do not have regular access to the household car, live in a rich region while not particularly benefiting from it. That shows that much needs to be done to reshape established patterns of work, investment and transport.
The potential is there: in tourism there can be no doubt of that, and there is also strong growth in electronics, telecommunications and pharmaceuticals. In my part of the world, Bedfordshire, the importance of Cambridge as an influential focus for growth is recognised through the work being done on the concept of the Oxford to Cambridge arc, which links Oxford to Milton Keynes, Bedford and Cambridge.
That reminds us of one of the issues that featured strongly in the two earlier parliamentary debates that I referred to: the absence of, and the need for, strong east-west transport links. Although we have Stansted, Luton and Norwich international airports, and the major seaports of Felixstowe, Harwich, Ipswich, Tilbury, King's Lynn, Great Yarmouth and Lowestoft, those have tended to reinforce the north-south London hub pattern because it is there.
If those of us in the eastern region are to tackle social exclusion, invest more to meet public expectations on a range of issues of public services and quality of life, and live up to our economic potential, we must raise our game and be more ambitious, building on our strengths and tackling the long-established strategic weaknesses. Transport is fundamental to doing that. I believe that the key to unlocking the potential of the region as a whole is the sustainable communities plan. Achieving the two growth areas in the east requires up-front commitments to infrastructure investment. Transport is an essential element of that.
The Minister knows that, historically, transport investment in the east has been poor. That is partly because, until now, there has not been a coherent regional voice and the necessary strategic output has been absent. There are existing commitments, mainly for road improvement, to address the needs of the existing population. There is also a compelling case for improvement in capacity and level of service on the rail network, again justified entirely on the basis of existing needs. On top of that there is a requirement to boost transport investment to deliver the growth areas.
Ministers will be aware of the regional planning body's infrastructure bid to the comprehensive spending review 2004, mainly but not exclusively for transport investment. I think that the investment is more likely to happen, and that it will be far more cost-effective, if regional bodies and local councils opt for accelerated rather than mercy trend growth. The region underperforms, and a step change in planned growth is needed to address that. Especially because it needs to be accelerated, such growth must be balanced and it must be jobs-led. If it not, we will simply reinforce the congested patterns of social exclusion and relative economic underperformance that characterise the region.
To avoid that, and the decline that would surely follow, I believe that two things are needed. First, local councils and regional bodies must have the courage and imagination to embrace accelerated growth and they must be positive about the opportunities that it represents. Secondly, the Government must be radical and serious about reforming the formulae used for public spending programmes. We all know that those are normally based on past events; they lack a forward-looking component. As a result, they fail to make allowance for planned growth. Areas growing faster than average are perpetually underfunded and playing catch-up.
That exactly describes the situation in Bedfordshire, where, for example capitation allocations for the NHS have, over the years, remain locked below the investment levels deemed necessary to meet existing needs, never mind planned additional needs. I urge the Minister to take on board this point: sustainable communities will not be sustainable unless the Whitehall machinery is redesigned, and that is his province or that of his colleagues. I look forward to his comments on that.
One golden opportunity reinforced by the growth areas initiative is the east-west rail link. I have long supported that project, which will benefit the region and beyond as well as Bedford and Kempston in my constituency. I understand that following recent positive discussions with the Office of the Deputy Prime Minister, the east-west rail consortium is now hopeful that a clearer way forward will soon be established for the western half of the project; that is, from Bedford to Bletchley, Oxford and Aylesbury. That will mean taking the consortium's existing feasibility study to the next stage. I hope that the opportunity is grasped to ensure that the level of investment committed is sufficient to the task.
My hon. Friend will be aware that parts of the eastern half of the project—east of Cambridge—have already benefited from improved services, with more improvements planned to come into being this autumn. That leaves the missing link between Bedford and Sandy. We cannot have east-west rail without plugging that gap, so action is needed. I hope that my hon. Friend will indicate that the Strategic Rail Authority's regional planning assessment will at last start to operate in harmony with land use and economic development plans. I hope that he will acknowledge the strategic importance of the SRA's taking fully on board the growth area plans and, in that context, use his best offices to encourage the SRA to consider east-west rail

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as a whole and plug the gap. I would like to see a programme designed to achieve that sooner rather than later. The delay has gone on far too long.
Delivery of east-west rail will spread the benefit of the growth areas as well as addressing existing problems. It therefore has the potential to reduce the levels, such as they are, of opposition to and uncertainty about housing growth. The same can also be said about another project: the Bedford to Milton Keynes waterway. I admit that the building of a new canal is not exactly geared to solving modern transport problems, but the project is integral to creating an attractive environment, boosting land values and developing leisure opportunities. It will help to put the Marston vale, south-west of Bedford, on the map. The project has strong all-party and public support and will contribute to the regeneration of an area that for far too long has been exploited for brick clay and unsustainable landfill. It is time to put something back into the area. The Government need to give strong support to that project, which is entirely consistent with the growth area initiative in that part of the world.
My hon. Friend will also be aware that I have had detailed discussions with ministerial colleagues about delivery of the Bedford western bypass, which is to be developer funded. I am pleased that in the past few months the Government have decided to make additional funds available up front to kick-start the project in the reasonable hope that it will trigger action by developers and landowners to fund the project as a whole. I hope that that will work. We will need to monitor events on the ground closely to ensure that it does. Lack of action would stifle delivery of part of the Milton Keynes and south midlands growth area, which would be unacceptable to all of us.
Clearly, there is much that I have not attempted to address in introducing this debate. The region is large, with 56 parliamentary constituencies. I look forward to hearing what other hon. Members say this afternoon. I hope that they will agree that the creation of the regional bodies plus the impetus for growth represented by the sustainable communities plan will trigger activities and a programme of social, economic and transport improvements that have the potential to benefit the eastern region as a whole for many years to come.
Mr. Deputy Speaker (Sir Nicholas Winterton): Before I call the next speaker, I indicate my intention to start the winding-up speeches at 3 o'clock, I say to the spokesmen for the Liberal Democrats and for Her Majesty's Opposition that I want the Minister to have adequate time to reply to this wide-ranging debate; I hope that they will bear that in mind.
2.15 pm
Mr. Keith Simpson: I begin by congratulating the hon. Member for Bedford (Mr. Hall) on securing this important debate. I was very grateful for one line in his speech in which he emphasised the need for strong east-west links across the region. That is something on which I intend to concentrate. I know that when the Minister saw me his heart sank, as he knew that I would raise the question of the A47. Queen Mary had "Calais" engraved on her heart; I think that the Minister will have "A47" engraved on his over the next year.
The A47 has intermittent stretches of dualling between the A1 in the west and Great Yarmouth in the east—a length of about 170 miles. Stretches of the A47 pass through my constituency on either side of Norwich. I am very glad to see the hon. Member for Great Yarmouth (Mr. Wright) present; he may try to catch your eye, Mr. Deputy Speaker, because he has a constituency interest in the matter.
This is the second time that I have spoken in the Chamber on this subject. On 24 March 1999, I participated in a debate on transport in the eastern region initiated by the hon. Member for Luton, North (Mr. Hopkins), and on 4 June last year I participated in an Adjournment debate on the A47.
The dualling of the A47 is a high priority in Norfolk. Last year, the county council resurrected the old A47 alliance, which is supported by all MPs, all county, district and town councils, business groups, trade unions and many voluntary organisations in Norfolk. There is hardly anyone outside that umbrella organisation. The Minister may also be interested to know that the Norfolk county strategic partnership has undertaken a wide survey, entitled, "Your Norfolk, your day", which has produced some interesting findings about the priorities of the county's population, including a high priority for the dualling of the A47.
It would he fair to say that public opinion in Norfolk is heavily in favour of dualling the A47, and, with local support, the alliance will lobby and campaign to achieve that objective. It could be said that it is Norfolk's own big conversation, and we hope that Ministers will listen. They are aware of the strength of feeling—on 15 October last year, the Under-Secretary of State for Transport, the hon. Member for Plymouth, Devonport (Mr. Jamieson) received a cross-party delegation who briefed him on why we thought that the road should be totally dualled.
I want to press this Minister on one general point and one local point. As I said, the A47 stretches from the A1 in the west to Great Yarmouth, and there is concern in Norfolk and areas to the west that the Government have failed to take a strategic view of the importance of the east-west link. One has only to look at a map of East Anglia to see a broken thread stretching 170 miles. The route is important not only for Norfolk and Cambridgeshire, but for the east midlands. Whatever rail and local transport options we come up with, they will be feeble in comparison with the main one. That key route is unable to cope with the current traffic flow, but the Government will fail to achieve their own targets for reducing social and economic deprivation, encouraging economic development and reducing accidents if they continue with the current policy of remedial dualling in selected areas.
There is also the question of the impact of any development on Yarmouth outer harbour, which all of us in East Anglia hope will go ahead. It will be of great benefit to Great Yarmouth and the region. If the project goes ahead without substantial dualling of the A47, we will have a considerable traffic jam at the Yarmouth end of the Acle straight.
Ministers have avoided taking a strategic view and prefer to devolve responsibility—but not necessarily a lot of resources—to the East of England regional assembly while effectively retaining control. I disagree

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with the hon. Member for Bedford in that many of us have been sceptical about the ability of the eastern region to get what we want for our area. I persuaded the Under-Secretary of State for Transport, the hon. Member for Plymouth, Devonport to acknowledge that there was a case in principle for the whole of the A47 to be dualled—without committing any money—according to the Government's criteria. That case is still relevant today, and I hope that this Minister will acknowledge that.
I turn now to more local issues. It would be churlish of me or any other Norfolk MP not to acknowledge local commitment and progress on issues in Norfolk relating to the dualling of the A47. I welcome the Government's decision to continue the dualling of a short stretch of the A47 east of Norwich in my constituency from Blofield to North Burlingham. When it is completed, it will reduce the number of accidents on that treacherous stretch of road.
In Norfolk, we are concerned that the important scheme to dual the A47 from Acle to Great Yarmouth may be turned down as a result of the environment assessment undertaken by the Highways Agency, which I understand will be published shortly. Although the agency has assured Norfolk county council that it will keep in touch as the process develops, Norfolk MPs, the council and the A47 alliance are concerned that that does not mean that it will seek the council's views, and it will not necessarily take into account any economic assessment.
The Minister may not be aware that I recently wrote to the Under-Secretary of State for Transport, the hon. Member for Plymouth, Devonport, expressing my concerns on behalf of the A47 alliance about the failure to assess the economic aspects alongside the environmental impact of any dualling of the A47 stretch known as the Acle straight. On 7 June, Mr. John Reynolds, the chairman of the east of England regional planning panel, wrote to the Secretary of State for Transport about the lack of economic assessment and the incomplete information on which the Minister was to base his decision.
Will this Minister examine the Highways Agency proposals and consider whether they have taken into account the economic assessment for the dualling of the A47 Acle straight? The Minister will be aware that that narrow, single-lane road is the only main road connecting Great Yarmouth westwards to the rest of Norfolk and the east midlands. The hon. Member for Great Yarmouth and I know only too well that a bad accident or a lorry losing its load can block the A47 for hours—for one day on one occasion—leaving Yarmouth isolated on one side. That is unacceptable. Please can we see some action, Minister?
2.24 pm
Mr. Kelvin Hopkins: I congratulate my hon. Friend the Member for Bedford (Mr. Hall) on securing the debate and thank him for his fine speech, which was thought provoking and, indeed, elegant. My speech may not be so elegant and wide-ranging. I have some specific points for the Minister. Some of them may appear to be parochial and sub-regional, but they have regional implications and are not just about my own constituency.
If the eastern region is to be made a meaningful and coherent region, we must have better east-west links. At the moment, it is much easier to travel from Luton to Leicester than from Dunstable to Dunmow. Indeed, the prospect of driving to Dunmow is something at which I blanch, having done it from time to time and taken many hours to do so. We heard about east-west links before, and I shall return to the point.
I thank the Minister for his support in securing a decision to expand Luton airport. That was a wise decision in the pattern of south-east provision and it will be a boon to the people of Luton in terms of employment and prosperity for the future. More than that, it was a sensible decision for the country as a whole and for the region. Most of us in the area are supportive of the expansion. Sadly, that is not the case for Stansted. I do not know whether other hon. Members want to speak about Stansted, but there is less happiness about the possibility of expanding that airport. I leave that thought with the Minister.
Expanding passenger throughput at Luton airport from 7 million to 30 million a year means heavy investment in local transport infrastructure in our subregion. We already have Luton Airport Parkway station, which is welcome, but in future we will need a dedicated people-mover from its platforms to the airport concourse if we are to make that station attractive to people travelling by train or, indeed, by car to the Parkway car park. That is vital, and I hope that the Government will support and encourage Luton in developing a dedicated link of that kind.
We also need to promote and encourage the development of Thameslink rail routes. Last week, I hosted a presentation in the House for Network Rail to talk about the future of Thameslink. We understand that the Thameslink work will start in 2007 and finish in 2012. That is 12 years later than some of us hoped, but at least it seems likely to happen in that time. We will have 12-car trains stopping at many stations, which will make a big difference to those travelling from London to use Luton airport. It will also help our local prosperity.
The next problem in our sub-region is M1 widening. I read in the newspapers—although I do not believe everything I read in them—that, in the Chancellor's consideration of future spending plans, the M1 widening expenditure is at risk. If we do not receive all of it, we should get some. Widening the M1 to the south of Luton from junction 10 is vital. It would take the pressure off the M1 further north, which is, I think, where the bottleneck is. The M1 serves the airport and the economic regions to the south of Luton, which are vital to our local economy. I therefore urge the Minister to press the Chancellor to permit M1 widening at least as far as junction 10.
Widening the M1 through my constituency would be much more difficult. It would be expensive and enormously disruptive, and it would involve a lot of blight. It would be possible to avoid widening through Luton provided that it takes place to the south of the town. The alternatives depend on enhancing rail travel with a park-and-ride station to the north of Luton and a north Luton Parkway station, adjacent to the M1 and linked to a north Luton bypass.
We talked about east-west links. At the moment, going across the north of Luton means going through my constituency, using wholly inappropriate residential

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roads and causing problems and environmental disadvantages for my constituents. We need a north Luton bypass. It has been talked about and tentatively drawn on maps, but we have not yet had any firm commitment to it. I urge the Minister to take that possibility seriously. Such a bypass would link the A5, the M1, the A6 and eventually the A505. I hope that there will eventually be a bypass on the A505 past Hitchin, Baldock and Letchworth. Then we really would have an east-west link that would make some sense and provide a through route, so that travelling from, say, Dunstable to Dunmow would be considerably easier.
There must be a mesh right across the region. It cannot just be based on spokes from London, with occasional urban blobs drawn on the spokes and no links across. That would not be a region; it would be a series of spokes dependent on London. The north Luton bypass and north Luton Parkway railway station are vital. With them, we can avoid another rat run from east to west through Luton which involves using the M1 as a bypass. People come on to the M1 at junction 11 in my constituency, near the hospital, and use it as a bypass going south and then east. That happens in rush hour in particular. A north Luton bypass that stretched right round from the A5 not just to the A505, but to the airport, would take an enormous amount of traffic off the M1, obviating the need for widening it in my constituency, at least for the foreseeable future. That would save the Government vast sums and would also prevent enormous blight and environmental degradation in the area.
The Minister will be aware that there has been a pretty fierce debate on Translink. There were questions in the House last week. Translink is the scheme to link Dunstable and Luton on an old railway line. Luton borough council favours, a guided busway. I go along with that suggestion and have seen it demonstrated as the only feasible option, at least in the short term. In the longer term, I would like to see the line used for longer distances, perhaps as a light rail system. I know that such systems are expensive and that our kind of conurbation might not have the numbers of people to justify that. However, Luton is to be part of a new housing area; between Luton and Milton Keynes, tens of thousands of new houses will be built. Luton will become a bigger conurbation and will get closer to Milton Keynes. We must look carefully at other transport infrastructures in the area. We may reach a critical mass at which we could justify a light rail scheme using the Translink track, as well as guided busways. I have spoken to engineers, and it is quite feasible to have a guided busway and light rail on the same route.
That is looking far into the future. I like to think that our Government will do that, and not just think about short-term fixes that are commercially feasible only in that time frame. I like to think that they will look at what the country and the region need for their long-term future. I have campaigned for a long time for both schemes—the northern ring road and a light rail system that would cover not just Luton, but other conurbations to the east and west. Those are simply my own thoughts at the moment. I shall continue to press matters in the future. I hope that in time, the Minister and his colleagues in the Government will take them seriously.
2.33 pm
Dr. Phyllis Starkey: Since my constituency is not actually in the east of England, but is immediately adjacent to it, I am particularly grateful to be able to participate in the debate called by my hon. Friend the Member for Bedford (Mr. Hall). I want to concentrate on one particular aspect that he raised in his speech: east-west rail. I am the chair of a virtual all-party group—it communicates, but does not meet—on the east-west rail link. It links Members from Ipswich and Norwich in the east to Swindon in the west, and all virtual stations in between.
The arguments for an east-west rail link are long standing and have been strengthened by the plans of the Office of the Deputy Prime for sustainable communities growth in the area between Milton Keynes, Northampton, Bedford and Luton. That part of the east-west rail link would both facilitate and support the housing and employment growth that the Government want and for which they are planning.
Some years ago, before the sustainable communities plan, there was an investigation into the likely employment generation of the east-west rail link. At that time, it was estimated that it could create up to 10,000 jobs at 11 locations along the route. If that investigation were updated, I am sure that its employment-generating power would be even higher. It would not simply facilitate and support housing growth; it would provide an alternative route for those living in the new communities to commute to employment in, for example, Milton Keynes and Bedford. It would provide an alternative to using the roads, obviating the need to upgrade the road system, which those in the additional housing would otherwise be using. and it would avoid increased congestion in urban centres in the sustainable communities. That is also important, as my hon. Friend mentioned, in the context of the Oxford to Cambridge arc.
I shall digress into history and remind hon. Members that the war-time code-breaking station that was the precursor of GCHQ was in Bletchley park in my constituency precisely because it was on the then Oxford to Cambridge railway, halfway between Oxford and Cambridge. Most of the original cryptographers were academics from Oxford or Cambridge. That was the ultimate example of early technology spin-off and, as everyone knows, it played a hugely valuable role in this country's survival and eventual victory in the second world war. The model for the Oxford to Cambridge arc is the notion of using the intellectual spin-off from the two cities with the land and labour availability of the middle sections of that arc in Bedford and Milton Keynes to ensure that employment generated by that academic research is captured in the region. The east-west rail link is extremely important to that.
I understand that the Minister is reeling under the repeated demands, not just in this debate but in others, for the upgrading of a transport network that is suffering from the extreme under-investment of the past, and that it is not possible for the Government to meet all those needs immediately or even in the medium term. I know that in the Strategic Rail Authority's forward planning the next part of the east-west rail link has only a medium to long-term priority. However, I draw the Minister's attention to the fact that, with the sustainable

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communities plan, there are now additional sources of income for the east-west rail link that do not exist for other competing rail priorities. They come from the ODPM and sustainable communities funding or from developer match funding, because a significant number of developers are willing to make a contribution to the rail link as part of the planning for the various developments that they wish to put in place along the route. As I say, that funding is not available to other rail links. It would lever in money extra to the investment that the Government would be asked to make, increasing its effectiveness.
I want to make a further point about the importance of the Government maintaining the momentum of the east-west rail link. The local authority consortium has, for more than a decade, kept open the idea of reopening the Oxford to Cambridge link and re-establishing the east-west rail link. It kept it open during a fallow period under the last Conservative Government when it seemed that railways were being shut instead of invested in. It has maintained that momentum even though the pace of development has been much slower than it hoped. Silverlink has invested in the Bedford to Bletchley section of the east-west rail link.
In a matter of days, the Bedford to Bletchley service will stop for a month. That is not something to make one feel unhappy; it is actually a great leap forward, if I may describe it that way. It is necessary because investment is being put into upgrading that section of track. When it reopens, the trains will be faster and more reliable, encouraging more people to use the service, which, outside peak hours, is not an attractive alternative to the road, as it is so slow. The trains run at the speed they did 80 years ago, so at present the line is scarcely at the forefront of rail technology; however, it will be after the upgrade. Silverlink is putting significant private investment into that section of track. It does so in good faith, believing that it will be part of an upgraded east-west rail link.
If the Government are to continue to encourage private investment in our transport network, it is extremely important that private investors continue to believe that the Government are committed to reopening the Oxford to Cambridge link in the medium to long term. I urge the Minister to work with his colleagues in the ODPM to progress the east-west rail link, in particular the western section between Bedford and Oxford through Bletchley and the additional service to Aylesbury, and to move it on to the next stage. I also urge him to ensure that the eventual route for the missing link in the section east of Bedford is protected. Forward movement can then continue and commitment from the private sector can be maintained in the knowledge that the Government will deliver in the end, even if not at quite the speed that we might all wish for.
2.42 pm
Mr. Anthony D. Wright: I apologise for being late for this debate. I had made a commitment prior to its being selected. I congratulate my hon. Friend the Member for Bedford (Mr. Hall) on initiating the debate, which is timely. I am pleased that he secured this opportunity to discuss the current state of transport in the eastern region.
The eastern region has the third largest volume of traffic in the UK, but public provision for transport in the region still falls behind because of past policies, funding neglect, rural geography and the economic history of the area as a whole. In total, 53.7 billion vehicle kilometres were recorded on roads in the east of England for 2002—11 per cent. of the total road traffic on England's roads for that year. Indeed, reliance on the car, lack of maintenance and development of the strategic road network, an incomplete rail service, increasing urban congestion and under-utilisation of our economic assets because of public poor transport connectivity leave the region lagging well behind.
England spent £8.1 billion on transport in 2002. That was a dramatic increase on the £5.14 billion that the Government invested in 1999. However, the eastern region received only a small fraction of that amount. Indeed, in Norfolk, £38.5 million was spent in 1999, but the figure dropped to £34.5 million in 2002. The Budget showed an increase in Government resources, but in Norfolk the figure actually dropped significantly.
Great Yarmouth, in particular, lacks integration and infrastructure, resulting in an inconsistent transportation network in the east. Limited resources are focused on central areas at the expense of peripheral areas and economies. The Government's strategy for delivering a modern, safe, reliable transport system is explained in the 10-year plan for transport. It sets out a £180 billion investment programme covering all forms of land transport. Incorporating the Government's goals in the east will be essential in reducing previous comparative disadvantages. It is vital to ensure that proper funding goes to the eastern region, where it is needed and deserved.
The east of England's regional transport strategy, once released, will provide an initial template for a joined-up strategy. Ideally, it will promote the region's efforts to gain increased funding to meet transport delivery targets. It is essential that such a strategy maximises the economic benefits of transport in our region while developing access, reducing reliance on the car, improving and maintaining the existing strategic network and ensuring better access to it for all who live in our region. Such developments must also seek to reduce congestion, address environmental concerns and promote safety at all times. Access to and development of ports and airports will be crucial in increasing the eastern region's prosperity. Future access to ports and airports should therefore be a central component in determining the transport network hierarchy in the region.
The region is home to four major ports and two major airports, as well as several other smaller ports and airports. Its proximity to the sea makes the port and shipping industry particularly attractive to our economy, and the legion must put forward a unified voice on the continued growth of all ports within it. In the 10 years from 1990 to 2000, total tonnage moving through UK ports increased from 490 million tonnes to 570 million tonnes, and the industry continues to grow. The Government view the private sector as best placed to develop and furnish new opportunities for ports, but port development is increasingly expensive, which means that there must be public investment at some point.
The need for investment in ports is evident in my constituency. In Great Yarmouth, a new proposal is set to service the growing freight and passenger market. Great Yarmouth port handles ships up to 125 m long, and in 2002–03 it handled 600,000 tonnes of general cargo. It works closely with all authorities in the area, and they believe that development is desperately needed to expand the service.
In February 2000, a £38 million outer harbour, EastPort, was proposed. The project involves building a new terminal, increasing quay space and depth to accommodate larger ships and an option to allow future rail connections. There is much co-operation within the area on that possible development. We have received correspondence and continued support from Norwich city council, East of England Energy Group, tourist attractions, other organisations and most MPs in the area. The area wants the development because it is seen as a step in a positive direction, and the project is recognised as vital for lifting the profile of Great Yarmouth.
The authorities completed an environmental impact assessment covering all aspects of the development and the subsequent operation of the harbour. Potential impact areas include construction noise and disruption, landscape disruption and coastal processes, and those authorities are working on those objections so that construction can commence at the earliest possible date. The process is often complicated and delayed, however. The scheme will be a major contributor to regional economic development and, with more than 500 jobs, will provide significant new employment opportunities.
The proposed design would accommodate vessels up to 200 m in length, allowing more general cargo to move through the port. The port will create lucrative trade and tourism links between the UK and Europe and will be ideal for midlands traffic to northern Europe. It would provide the shortest ferry route available to the Netherlands and create close links to the port of Ijmuiden. Ferry companies have also expressed their interest in establishing a roll-on/roll-off service for people and freight. The route is ideally suited for business, short-break and holiday travel between northern Europe and the UK. It is an opportunity for further economic development in the eastern region.
The outer harbour would also improve links internally, forcing the infrastructure to improve in order to maximise its potential. A rail connection for freight would be created at the river port, which is the best environmental option for freight transportation. The East of England Development Agency's report on the East Port proposal is in its final stages and heading in the right direction—towards construction. The construction of the outer harbour will bring great things to my constituency, which suffers from high unemployment and deprivation.
Ironically, Virgin Travel announced 180 job losses today. That is nothing to do with the economy, as it is a business case, but it certainly exemplifies the need for increased employment opportunities in Great Yarmouth and the whole eastern region. The construction of a new harbour will energise the community and improve the Great Yarmouth area. The Government's full support for the project is needed, because the region needs and is entitled to those improvements.
The Government have always aspired to a high capacity road network to accommodate the country's obvious transport demands. The demand for a dualled A47 is not new, as its development was first proposed in my constituency in 1971 with consideration of the dualling of the A47 King's Lynn to Great Yarmouth route. The A47 Acle straight is a vital part of the infrastructure needs not only of Great Yarmouth, but of north-west Norfolk as a whole. It links the region to the rest of the UK. In 1971, the Government pledged their full support for the construction. By 1978, the Government's strategic route approach had been watered down and replaced by proposals to build bypasses on key stretches of the road. In 1988, still without adequate room on the A47, Great Yarmouth produced a document called "Acle New Road: the Case for Dualling", accompanied by a supporting petition signed by more than 20,000 people. The previous Government still did nothing for my constituents, even though the 1989 White Paper included a commitment to dual the A47. In 18 years of Tory government, no fewer than 23 Ministers with the roads portfolio said that there was a definite need for dualling, but the Acle straight was withdrawn from the scheme in 1996. It is now 2004 and the road is still the same—insufficient.
The stretch in question is just eight miles long and is a single carriageway that has been the site of many accidents. Journey times have increased and Great Yarmouth continues to lose business to other towns through failure to dual the stretch. Without an appropriate road into Great Yarmouth, it is difficult to attract and retain investment. The people of Great Yarmouth are not asking for a totally new road, but for the dualling of an existing highway, with as little economic impact as possible during construction. Dualling would affect only 30 yards alongside the existing highway. Widening the road is not an attractive solution because it could take up to 18 months to complete, resulting in road and lane closures and affecting the local economy.
Great Yarmouth needs to be linked to the main strategic highway arteries if it is to overcome the severe problems of deprivation, high unemployment and peripherality that it endures. We must not forget the safety aspects. As I talk about economic progress, people may turn around and say, "Well, it probably wouldn't affect the economic prosperity of the area to have those roads". Yarmouth is probably the only major tourist resort with a significant port that is not connected by dual carriageways and standard roads that go directly to the town itself.
Following a recent survey of the outcomes of the Norwich to Great Yarmouth road-based study, it was announced that there was insufficient information on which to make a decision on the question of the Acle straight. The Highways Agency was asked to undertake three strands of work to investigate the practicalities of managing existing traffic during construction of either widening or dualling options and to assess the impact of delays during construction. That included a plan to investigate the condition and stability of the embankment carrying the A47 across the Acle straight, including the land take required for dualling or widening; to investigate the practicalities of managing existing traffic during construction via the widening or

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dualling options; to assess the economic impact of delays during construction; and to assess the project environmentally.
We understand that that report is due to be announced shortly with rumours clearly stating that the environmental impact would be too much for the dualling of the Acle straight to take place. I add this point: the road is also having an environmental impact in the town. I think that those considerations should also be taken into account. The most controversial part of the plan involves environmental assessment, as the A47 passes through an environmentally sensitive area. Its ditches apparently support the rare swallowtail butterfly, water voles and hawker dragonflies. My town also tries to support many unemployed and economically disadvantaged people.
There are large earthen embankments built alongside the A47. Authorities are studying them to see whether they are sinking into the marshland. The Acle straight has remained straight and without ditches along the side for all its time and it is certainly a stable area. Those studies, while important, are making my constituents and the rest of the eastern region wait longer for the A47 to be improved.
Despite the obvious benefits of dualling the A47, a recent report that emerged from the environmental assessment of the area states that dualling would cause too much damage to sensitive habitats along the Halvergate marshes. It is vital that the Government think about the long-term economic benefits to my community and the entire region when considering the project. I feel strongly that dualling should be considered with respect to overriding public interest, with the net benefits of the project outweighing the environmental disadvantages.
The Government are also calling for an end to reliance on cars, which is a major concern. Owning and driving a car is an inevitable requirement for daily life in the eastern region, with 84 per cent. of all journeys and 75 per cent. of work journeys made by car. In 2002, 167 million passenger journeys by bus and light rail were travelled in the east of England, which is an increase of only 5 million during the past 10 years. The east of England has the lowest levels of such journeys of all the English regions. Those extremely low levels are caused by the lack of cohesive public transport in the east. We are consistently receiving complaints from constituents about their inability to access and utilise public transport. Services are insufficient and unfairly biased towards central regional hubs instead of more peripheral areas.
In the period 1999–2001, access to buses stood at 79 per cent., which was 10 per cent. below the national average and placed us as the third-worst region for access to buses in England. For example, the 704/705 bus service in the Flegg area of Great Yarmouth has been withdrawn, limiting the ability of residents to travel to Great Yarmouth to use vital services such as doctors and dentists, and for shopping and employment. The closures were cited as necessary for economic and commercial reasons. Many other bus routes are closing, including those that children use to
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get to school and that the elderly use to do their shopping, and they are being replaced with services that are inefficient.
Norfolk county council received a £2.5 million subsidy from the Government to support rural bus services, and we should congratulate the Government on taking that initiative. However, not one penny of that subsidy was made available for those important community routes or, indeed, for the constituency as a whole. Norfolk county council still refuses to provide funds to reinstate those routes, but representations are currently being made to the Department for Transport. There have been meetings with the county council to discuss the issues, and another is planned with FirstBus.
Railway accessibility also needs serious improvement if the railways are to become a fully functional system. There is currently no direct train route between Great Yarmouth and Lowestoft. Links from Norwich to both Great Yarmouth and Lowestoft are slow, requiring a change at either Reedham or Brundall. That makes the journey excessively long, and passengers are calling for the elimination of the change, stressing the need for a short rail link in the Reedham area. The lack of a direct service between Great Yarmouth and Lowestoft also puts increasing pressure on bus services and highlights the need for quality bus corridors between the two towns.
A more co-ordinated and transparent approach is required to address; overall negative trends and poor service provision such as those illustrated by those trends, cases and issues. The East of England regional assembly's regional planning guidance illustrates five major areas to improve future access in the east and to address such concerns. They include improving facilities for walking and cycling; locating and designing housing to enable and encourage public transport; improving public transport provision; and locating public facilities and employment-generating developments where they can be readily accessed. Public transport must be easy to use, in greater supply and affordable, and it must link more rural areas to busy metropolitan areas in the east and the strategic network as a whole.
In conclusion, action must be taken in pursuit of the development of transport in the eastern region. The improvements that I have mentioned, including construction of the EastPort outer harbour, dualling of the A47 highway and the establishment of a more interconnected public transport system would greatly benefit not only my constituents in Great Yarmouth, but all the people in the eastern region, because they would create lasting connections. Those improvements would offer numerous social and economic benefits that would be appreciated by many people.
2.59 pm
Mr. Chris Mole: I, too, start by congratulating my hon. Friend the Member for Bedford (Mr. Hall) on securing this debate. I shall try to give a slightly different slant on the discussion because regional debates should not be just a clamour for a regional wish list. One of my points is that the policy terrain must change as we move further towards becoming a knowledge economy. In that context, I commend the Minister on the development of the Government's transport policies as they have impacted

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on the east of England. I was the leader of a highways authority for eight years; the massive increase in local transport plan investment is very welcome and is delivering real differences to urban transport measures such as bus priority lanes, cycle ways, improved pedestrian environments and projects such as home zones. It has also encouraged green travel planning, and I welcome the fact that the planning framework has delivered new developments and required organisations taking up new premises carefully to consider travel arrangements for their employees.
In considering the inevitable demands for projects across the piece, the Government must continue to keep an eye on maintenance investment to ensure that we can make the most of existing infrastructure. We need to be strategic, and welcome the East of England regional assembly overview of regional transport planning through the development of the regional transport strategy. I hope that that will be an inclusive process linking the regional spatial strategy and the regional economic strategy to create the right framework for transport in the region.
To return to the point about making the most of existing infrastructure, I ask the Minister to ensure that when proposals are produced the opportunity for online improvements to the infrastructure is considered. Developments such as those on the A140 between Ipswich and Norwich have already delivered significant improvements in the flow and capacity of that—formerly trunk, now county—road. Other initiatives such as variable signing create the opportunity to compound the current capacity of many routes.
Before I turn to one or two strategic schemes that I think are important, I commend the Minister to stick to the new approach to assessment and its framework of considering the costs and benefits, the environmental impact and, crucially, the economic impact when judging the value of a new development, new road or new aspect of transport infrastructure before the go-ahead is given.
Much has already been made of the Oxford to Cambridge arc. I wish to plug briefly the Ipswich to Cambridge high-tech corridor, which, by international standards, is comparable to the size of silicon valley. The development of the eastern end, to which my hon. Friend the Member for Milton Keynes, South-West (Dr. Starkey) referred, of the east-west rail link is important. We can point to the sort of investment that took place through the rail passenger partnership process, which has pump-primed an effective new service between Norwich and Cambridge. We would like to see that approach adopted on other parts of the network.
I hope that the greater Anglia franchise creates the opportunity for us to have an hourly service between Ipswich and Cambridge, but I can only echo my hon. Friend's positive comments about the importance of route protection if there is to be a long-term strategic opportunity for the region. I have had the misfortune in the past of having to explain to people why bits of rail network cannot be reopened because housing estates have been built on them during the intervening years.
I would like to switch momentarily from passengers to freight. Felixstowe is Europe's fourth largest container port; it is still growing in capacity and has
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further capacity for transfer of freight to rail. I want to plug the Felixstowe to Nuneaton project, which will see the closure of the Ipswich tunnel in a few weeks as the new 9 ft containers continue their route down to London, across the heavily congested north London line and up to the west. I would like to encourage the Minister to do whatever he can to ensure that what was the Strategic Rail Authority's top freight priority regains that position.
I welcome the Government's shift to an increasingly environmentally sensitive approach while testing the case for economic impact. I continue to support an approach that is selective to key regional priorities, and I commend the bids and communication made by East of England regional assembly members in support of regional planning guidance note 14. If the Minister does that, he will get all our thanks.
3.6 pm
Mr. Paul Marsden: I shall keep my contribution suitably short as I realise that it is far more important that the Minister respond to many of the issues that have been raised in this excellent debate. I congratulate the hon. Member for Bedford (Mr. Hall) on securing it.
Each region is quite unique in its problems and opportunities. The eastern region is diverse; nevertheless it is represented by some excellent Members who have demonstrated this afternoon that they will work on a cross-party basis on many common issues.
The Government's role in any region is to deliver a safe, affordable and reliable strategic network of public transport services while allowing for a sustainable environment. I hope that the Minister will address the issue common to all contributions today, namely the east-west rail link. The hon. Member for Bedford talked about the importance of plugging that gap, and the matter was also raised by the hon. Members for Mid-Norfolk (Mr. Simpson) and for Milton Keynes, South-West (Dr. Starkey).
I cannot let this moment slip by without the mentioning the need to dual the A47, and I hope that the Minister will explain what role the Government can play in that strategic network. It was also pleasing to hear a certain green tinge, with the hon. Member for Bedford mentioning the canal scheme and the hon. Member for Luton, North (Mr. Hopkins) mentioning the guided busway.
We had a Committee sitting this morning to discuss delegated legislation that will permit the growth of Stansted airport's capacity to a maximum of 25 million passengers a year. It will inevitably deliver a second runway for the airport, and with the space between those two runways there will be a third in years to come. That is where the Government have got it strategically wrong. Without considering the local and strategic situations, they are saying that we must manage demand.
Although it is pleasing to hear that regional airports are to expand with the support of the public and Members such as the hon. Member for Luton, North, the Government have patently got it wrong with the bigger airports. If expansion goes ahead at Stansted, two scheduled ancient monuments, 29 grade II listed buildings and 700 hectares of land will disappear.
Turning to buses, I hope that the Minister will respond to concerns in Bedford about Stagecoach. Ann Jones, quoted in Bedford Today, said:
"Bedford is a busy county town but there will be virtually no buses in the evening. Surely this is not in line with Government policy. They want people to stop using their cars but keep cutting the bus timetables".
The Department for Environment, Food and Rural Affairs website mentions a target to increase by one third the number of rural households with a regular bus service within ten minutes. How close does the Minister think the predominantly rural eastern region is to achieving that?
Mr. Deputy Speaker: The Chamber is very grateful to the hon. Gentleman for his brevity.
3.10 pm
Mr. Christopher Chope: I, too, shall try to be brief. Essentially, we have had a very long Adjournment debate. If someone secures an Adjournment debate for half an hour, a quarter of an hour is normally spent putting forward the case, and the other quarter of an hour is for the Minister's response. Given that Members have made a whole series of points and that, almost without exception, they were highly critical of the Government's performance over the past seven years, it would be ironic, and sad, if the Minister were let off the hook because we ran out of time.
I congratulate the hon. Member for Bedford (Mr. Hall) on introducing the debate and other people on participating in it. However, it is worth reminding everybody that we had a full debate in the main Chamber on Thursday about the work of the Highways Agency. Those of us who were present were disappointed that more Back Benchers did not take advantage of the opportunity to raise constituency issues. There was plenty of opportunity for the Minister in that debate to respond to all the points that were made. The points made by my hon. Friend the Member for Mid-Norfolk (Mr. Simpson) were highly pertinent. He said that the Government do not take a strategic view, and I wholeheartedly agree. They talk about local determination, but they starve local communities of the resources to enable them to take decisions and implement them.
One area in which the Government have not taken a strategic view is particularly pertinent to the eastern region, in which so many of the inadequate roads are connected to small or medium-sized ports. There is obviously also the great port of Felixstowe. The Government's lack of a ports strategy is likely to result in much more container traffic being unloaded at big ports on the continent and then transhipped across to the smaller ports. The Government have not thought through the implications of that for those small ports and the transport connections to them. If the east coast ports benefit ironically, from the lack of international competitiveness that has resulted from the Government's refusal to allow the port of Southampton to develop its container terminal, and as a consequence there is more transhipment from the continent to eastern ports, we must think about the implications for the road network and the people living in communities around it.
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I just cite that as another example of a subject on which the Government have palpably not engaged in joined-up thinking.
On the individual road schemes that have been mentioned, it is worth pointing out that there are already schemes in the Government's targeted programme for improvements that would cost the best part of £8.8 billion. Many of the schemes that have been talked about today are not even included in that programme, and, at the present rate of spend, many of the schemes that are included will not be built for about 15 years, because the Government are spending far too little on road investment.
The hon. Member for Milton Keynes, South-West (Dr. Starkey) said that the transport network is suffering from the extreme under-investment of the past. In fact, it is suffering from extreme under-investment over the past seven years in particular and the consequences of the present Government's deciding against many road schemes immediately after coming into office on the basis that the best way to stop people travelling was to deprive them of any roads on which to travel. They have now changed their tune a bit, but they have not delivered the investment necessary to ensure that the road infrastructure, particularly in the eastern region, is improved dramatically.
I have taken a careful note of the points that have been made, because they will be very useful to us as we draw up our list of commitments and priorities for the next Conservative Government.
3.14 pm
The Parliamentary Under-Secretary of State for Transport (Mr. Tony McNulty): I congratulate my hon. Friend the Member for Bedford (Mr. Hall) on securing this wide-ranging debate. He and other colleagues have covered many issues in the eastern region, which, as many have alluded to, is very diverse. If we are being strictly accurate, it contains parts of three growth areas, not two of them, as per the sustainable communities plan—the entire south Essex section of the Thames gateway growth area is in the eastern region as well.
As others have pointed out, the area stretches from the London commuter belt of Hertfordshire and Essex to the remote rural areas of East Anglia. It includes urban areas such as Luton and Southend and cities such as Cambridge and Norwich as well as not just those growth areas but other areas that are priorities for regeneration, such as Great Yarmouth, to which my hon. Friend the Member for Great Yarmouth (Mr. Wright) alluded, Lowestoft and large rural areas such as Breckland.
The area contains a range of roads and railways of national strategic importance. I take the point made by many of my hon. Friends that the historical relationship with London has resulted in the development of a hub and spoke system. The area is well served by north-south links, but not terribly well served by east-west links, whether by road or rail. I shall return to that point shortly.
As the area is so diverse, there are many transport issues to be dealt with: congestion in the urban areas and on the major roads, as we have heard; public transport accessibility in rural areas; new infrastructure to meet the proposed housing and employment increases; and

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maintenance of existing infrastructure. I shall deal with some of those in more detail later, but we must remember that the region contains a great many areas of environmental importance. We must always balance the impact on those areas with the need to improve our ability to move people and freight around.
I took to heart what my hon. Friend the Member for Ipswich (Mr. Mole) said. Collectively, local government and central Government are moving to a far more strategic focus that does not simply mean, as it used to, a regional wish list put together with scissors and paste to replace the localised wish list, but that includes a notion of how improvements in transport infrastructure of whatever sort sit within the wider regional framework and overall strategy. The focus is not simply within regions, but, to an extent, between regions, particularly given the sustainable communities plan—that interaction between the three growth area regions of the east, south-east and London. That is important, too.
I shall resist commenting on the previous speech. Suffice it to say that in the eastern region, as in many others, we must start by repairing the consequences of many years of under-investment by previous Governments of all persuasions. I thought that that was almost a given by this stage. Except for those with strange rose-tinted glasses, everyone, recognises that in public policy terms we, collectively, have failed—probably since the war—in providing public infrastructure investment on any sustained level.
In July 2000, it was right and proper to take the unprecedented step of putting in place a long-term investment framework—the 10-year plan—and, in going beyond that, to consider local and regional transport initiatives. The Government set a framework that sought finally to address the underlying malaise resulting from under-investment throughout the region.
It is important to recognise, as my hon. Friend the Member for Bedford said, that there has been an absence of strong east-west transport links. I was taken by his point that authorities in the area would need the courage and imagination to embrace accelerated growth—that is an important message—and that the Government must be radical in turn And revise formulae and various other methodologies for sharing out resources.
Certainly in the joint work across the Government by, among others, the Department for Transport and the Office of the Deputy Prime Minister, that work is starting to happen, and it is starting to happen ahead of the significant growth in the area and the pressure that that may put on transport infrastructure. In terms of some very basic lessons about how to readjust and reconsider Department of Health criteria, for example, we must factor in primary or tertiary care not on the back of existing births, but on projections, because the infrastructure has to be there when the communities move in.
The Department for Education and Skills is starting to examine criteria that move away from an approach of, "You show me the children and the basic need case, then we'll sort out the schools infrastructure." I freely say that the ODPM in particular and the Department for Transport are starting to consider that matter in far more detail. They are doing so not simply in terms of formulaic distribution of resources, but by considering
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in the widest possible policy context how growth area strategies sit with assorted allocation formulae and other devices for allocating resources, as well as how both sit with environmental, social, economic and other factors that comprise a sustainable framework.
The points raised by many hon. Members need to be regarded in a coherent and strategic fashion in that cross-Government context, rather than as part of a wish list under each of those headings that each locality wants, blown up into something purporting to be a regional strategy, which is not really one at all.
We should not start from the premise, as was suggested rather foolishly by the Opposition, that nothing has been done in these areas since 1997. The notion that there is too much money in the assorted transport budgets rather than too little, and that a change of Government will resolve that, is nonsensical. Much has been done in a coherent and strategic fashion. The comments of the hon. Member for Mid-Norfolk (Mr. Simpson) were well made, not least because I was in Norwich last Friday and heard those points from all and sundry down there due to the fact that he was all over the papers speculating that the Highways Agency report on the A47 will not pay full regard to economic conditions.
Everyone else was bemoaning the fact that, whatever the hon. Gentleman's powers of persuasion, Norwich City is not joining the A47 alliance, but that is by the bye. I did say while I was there, through very gritted teeth, how pleased I was that Norwich City got promoted. I am not really, because my team did not.
None the less, the points about the A47 are well made. However, we need to wait until mid-July for the publication of the Highways Agency report, although the improvements already made to various parts of the A47 are targeted at those areas where the problems have been most acute. I had the great pleasure of going to Norfolk to open a flyover. Several people said to me, "It's flat there. What on earth can anyone fly over?" In the end, it transpired that it was a flyover over a roundabout. At the tail end of King's Lynn, the Hardwick flyover has made a significant difference—people in Norwich told me so.
If the hon. Gentleman means "strategic" in the sense of saying, "Here's Peterborough, here's Great Yarmouth. What are you going to do to sort this road out?" as part of a big bang approach, I would say that that is not strategy. The strategy is to consider each element in turn and deal with the most severe in a phased way. That is what has happened. I do not know whether that makes me the 24th or 25th Minister to say that there is a clear economic case for dualling between Norwich and Great Yarmouth, but it must be taken in the wider context and balanced with other factors. We will have to wait and see what is in the Highways Agency report.
I have said to Labour colleagues on the city and county councils in the Norfolk area, and I extend this to others, that if what prevails in the report is not to people's liking, or they want to discuss the report and its methodology further, I am more than happy to see them after the summer recess.
Mr. Tony McWalter: While my hon. Friend is concentrating so much on the north of the eastern region, I hope he will bear it in

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mind that east-west links—notably the A414, the A120, the A127 and other roads in the south of the eastern region—are equally impassable for east-west traffic.
Mr. McNulty: I will. I almost use the A47 as a metaphor for the difficulties with east-west road links. I mention it for no other reason than the fact that I was in Norwich last Friday, and I was greatly delighted at the tail end of last July to receive a running commentary from my hon. Friend the Member for Great Yarmouth on virtually every blade of grass between the railway line and the A47 as well as what should and should not happen to the A47 as we travelled to his constituency from Norwich. I am only grateful that he had other plans and that I travelled back without him and that same running commentary. It was so incomprehensible that I was still reeling from it.
We need a strategic approach to east-west road linkages, and I demur from the assertion of the hon. Member for Mid-Norfolk that we do not. My hon. Friend the Member for Luton, North (Mr. Hopkins) spoke about those links and the airports, too. I shall not go into the inaccuracies from the hon. Member for Shrewsbury and Atcham (Mr. Marsden) as there is not time, but I shall tell him afterwards that he made a mistake about what this morning was all about.
Is the M1 widening scheme at risk? I say to my hon. Friend the Member for Luton, North that we are barely weeks away from the end of term and between now and then we have the comprehensive spending review. Until that review is out, every element of this Government's public spending is at risk. He should not trouble himself too much at this stage with what is and is not at risk, and I urge him not to read or take any notice of the papers on transport matters. There is a rather stunted development among many in the media who comment on transport matters.
Junctions 10 to 13 are already in the programme with a whole range of other improvements to trunk roads and road networks. I do not have time to go through the points relating to the £600 million for the Thames gateway within and without the eastern region or the more than £1 billion of transport improvements throughout the other growth areas—substantially in the eastern region, because Ashford is self-contained in Kent.
I take my hon. Friend's kind words about Translink. By accident or by design, the eastern region did very well out of the major schemes in the last local transport plan settlement, with not only the Luton to Dunstable Translink guided bus scheme, but the equivalent scheme in Cambridge and Huntingdon.
We are getting to a stage where people must prioritise their transport requirements; they should not get too hooked up on the modes. My hon. Friend said that light rail is a bit expensive, but in real terms the cost of light rail schemes has gone through the roof. I know that expectations have been raised, but it is not enough for people to say, "It has got to be this light rail scheme; this bypass; this motorway; this road scheme or the area's dead, or we're going to slash our wrists and skip off to heaven in the morning." It cannot be like that.
We need a substantive public policy debate in each region and in each area. As my hon. Friend the Member for Ipswich said, a mature debate has started and it is asking where people want a region and its sub-regions to go as well as what is needed in the context of the sustainable communities plan. That includes housing growth and health considerations as well as the education and employment opportunities that ultimately spread aver the whole area, and also how transport, among other infrastructure, will help.
The same applies to modes such as rail. People in the region know better than me that there has been much discussion with the Government about the east-west rail link and that consortiums have drafted assorted plans. The last plan I saw was about how to take detailed work forward even more and its likely cost. That is with the Office of the Deputy Prime Minister and the Department for Transport. We will consider it and an announcement will be made in due course.
There is a lot happening with transport in the eastern region. Of course, much more must be done across the piece and across modes, whether with aviation, buses, roads, rail or waterways. I would not necessarily include the latter within schemes to be funded by the Department for Transport, although I can see the attraction of it. Far more is being done to drag up the infrastructure to an appropriate level to sustain not only the new growth, but the existing activity in an area that, despite pockets of deprivation, is extremely vibrant and economically active.

Planning Policy Guidance
3.30 pm
Alan Howarth: I want to put forward a case for retaining the provision, under clause 3.21 of the existing planning policy guidance note 7, which allows that:
"An isolated new house in the countryside may … exceptionally be justified if it is clearly of the highest quality, is truly outstanding in terms of architecture and landscape design, and would significantly enhance its immediate setting and wider surroundings."
In their new draft planning policy statement 7, the Government have omitted this provision.
Why should the Government want to end the country house exception? Some have seen this as a flicker of the embers of the class war. Colour is lent to that suggestion by the splendid amendment tabled to my early-day motion 160 by my hon. Friend the Member for Denton and Reddish (Andrew Bennett), supported by five luminaries of old Labour. The amendment deserves to be sampled:
"this House … further believes that if the countryside is to be preserved by not building ordinary houses, it is even more important that is should not be polluted with big houses for the arrogant, vulgar and rich".
I imagine my hon. Friends savouring their wording like a very old single malt whisky. Their tongues must have been in their cheeks. Certainly my right hon. Friend the Deputy Prime Minister would not take such sentiments seriously. The 73 right hon. and hon. Members of all parties who have signed early-day motion 160 know that this is a serious issue. We are at risk of losing a tradition of inestimable value to the countryside as well as to architecture.
Presumably the real reason why the Government have proposed to end the exception is in the words of a spokesperson for the Office of the Deputy Prime Minister, quoted in The Architects' Journal of 8 May 2003:
"We don't want loopholes in the law. We don't want to be in the position of having more housing in the countryside when we should be developing brownfield sites."
While I will argue that that statement is misconceived, I want to emphasise that I applaud the Government's concern to protect the countryside and to channel developments to brownfield sites. There should be no confusion between the country house exception and abusive developments in rural areas, such as those currently so bitterly contested near Woking and Leominster, and at East Coker and Cottenham—let alone the building fantasies of Mr. Nicholas van Hoogstraten. Clause 3.21 is not a loophole, but a policy deliberately intended, in a context of tight control, to encourage high-quality architecture and landscape design in rural areas.
An appeal in The Architects' Journal to reprieve the country house exception has been signed by more than 300 distinguished architects, planners, academics, commentators and others, including the right hon. Member for Suffolk, Coastal (Mr Gummer), my hon. Friend the Member for City of Chester (Ms Russell) and the hon. Member for Chipping Barnet (Sir Sydney Chapman). None of them, surely, would demur from the aims expressed by the Government in their draft
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PPS7. The Royal Institute of British Architects, equally, like the Historic Houses Association, while making a powerful case for keeping the country house exception in its submission to the Government's consultation, has emphasised that it endorses the Government's key principles, which are:
"New development away from existing settlements, or outside areas allocate for development plans, should be strictly controlled; in particular isolated new houses in the countryside require special justification",
and
"all development in rural areas should be well designed, in keeping and in scale with its location, and sensitive to the character of the countryside and local distinctiveness."
There is no contention about the Government's objectives of protecting the countryside while offering everyone the opportunity of an affordable and decent home.
The Government state at paragraph 10.2 that local planning authorities should
"strictly control new house building (including single dwellings) in the countryside, away from established settlements or from areas allocated for housing in development plans."
Paragraph 11 starts by saying:
"Isolated new houses in the countryside will require special justification for planning permission to be granted."
So far so good. But then the rest of paragraph 11, taken with annexe A, makes it clear that the only instances where isolated new houses may be contemplated are where they provide accommodation for full-time workers—for example, in agriculture and forestry—who need to live near their place of work. These sections of the draft PPS can only be read by planners as banning new country houses other than on previously used sites. The removal of clause 3.21 inevitably reinforces that interpretation.
Why does this matter, and why would the new policy be a mistake? Last autumn RIBA mounted an excellent exhibition, "The New English Country House". The exhibition catalogue describes 26 country houses, 17 of which have received planning permission since 1997 on the basis of clause 3.21. The 26 designs fall, according to Neil Guy, the exhibition's curator, into four broad categories: classical; traditional houses with a vernacular dimension; modern; and organic. Mr. Guy notes that even the houses more "historicist" in style are modern in the commitment of their designers to sustainability and "green" features. He goes on to say:
"What unites all the schemes without exception is the greatest care and attention taken with the landscape designs. They are all highly imaginative, yet context sensitive, and demonstrate such a depth of experience and richness of talent within the English landscape architecture discipline. Each scheme appears right for the house and right within its wider landscape context. This seemingly effortless harnessing of house and landscape remains an English tradition that continues to surprise and delight."
We are fortunate, indeed, that there are so many remarkable contemporary British architects and landscape designers, and policy should encourage them to work in a field—country house design—which has historically attracted the greatest talents. We should, I would add, not be prescriptive about style. If we insist on quality—and one of the reasons why clause 3.21 is so important is because it does so—we need not fear a proliferation of pastiche. We should welcome modern interpretations of traditional styles as well as being confident to accept modernism in the countryside.
I do not know whether my hon. Friend the Minister saw another exhibition, at the Victoria and Albert Museum in 1974, "The Destruction of the Country House". More than 1,500 English country houses have been destroyed in the last hundred years. John Harris, in a plangent essay in the catalogue, wrote of a
"dreadful series of demolitions and smash-ups that destroyed some of the greatest works of British art."
RIBA now estimates that perhaps 600 country houses have been totally demolished since the second world war. The forces of destruction—originally agricultural depression; subsequently taxation policy, plus road-building and ill-controlled suburban and industrial development—were too powerful to be countered by good governmental intentions for conservation, such as the post-war Labour Government's planning legislation and the introduction of the listing system, and the commissioning by Sir Stafford Cripps of the Gowers report leading to the creation of the Historic Buildings Councils. The challenge for us now is not just to conserve what survives but to nurture the renewal of the country house.
Rightly the Government seek to protect our heritage of country houses, vulnerable as it is to social and economic change, by investing money and authority in English Heritage. The enormous growth in subscribing members of the National Trust, up 50 per cent. in the last 10 years, demonstrates the scale of public support for this heritage. Admirably the then Secretary of State for the Environment, the right hon. Member for Suffolk, Coastal, introduced the country house exception in 1997, precisely to enable our own generation to make its contribution to the continuing vitality of this tradition.
As politicians we should not underestimate the extent to which the public today care about both the built heritage and the design of contemporary buildings. Just as concern for the natural environment became a major political force in the 1960s, so now more and more people feel strongly about the quality of their built environment, about the need to preserve our heritage of good architecture and design and our responsibility to design and build well in our own time, to add to the heritage. We have now repudiated the heresies of the 1980s that market forces should be paramount in determining the character of new building and that it is not the responsibility of the planning system to concern itself with quality. Sensitive to this growing public mood, the Government have rightly included in the Planning and Compulsory Purchase Act 2004 a requirement that applications for planning permission for development should be accompanied by a "design statement". In other ways too the Government have recognised this, for example with the publication of their policy document "Better Public Buildings" and the establishment of the Commission for Architecture and the Built Environment. As the Prime Minister said in his foreword to "Better Public Buildings":
"I have asked ministers and departments across government to work towards achieving a step change in the quality of building design in the public sector … I am determined that this additional money should be well spent, leaving behind a legacy of high quality buildings that can match the best of what we inherited from the Victorians and other past generations. And I am determined that good design should not be confined to high profile buildings in the big cities".
Only this last weekend, in The Observer, my right hon. Friend the Deputy Prime Minister expounded his own personal commitment to the promotion of good design. It would be inconsistent with the Government's strategic support for good design if, in obviating from now on the possibility of building new country houses, they were to deprive rural areas of the benefit of outstanding contemporary architecture.
If we now bring to an end the centuries old tradition of building fine houses in the countryside, we will impoverish architecture for everyone. As Paul Finch, deputy chairman of CABE, said:
"The history and discourse of Western architecture for many centuries has taken the individual country house as the occasion for experiment, proposition, development and of course the continuation of certain traditions. From Palladio to Mies van der Rohe, with the notable examples of Lutyens and Norman Shaw as contributors to the story, the relationship of living space to social structure has been worked through in fascinating detail. For Britain to bring the shutters down on this long cultural narrative would be a sorry state of affairs, especially since the villa tradition in cities is alive and well. It is precisely because country houses are designed in isolation, rather than urban context, that they have presented a particular challenge and opportunity to architecture across the centuries; the lessons learned have often translated to popular housing forms.
This mingling of architecture, history and living makes the question of the country house exception of more than simple planning interest. It is not an episode from 'Upstairs, Downstairs', but part of a richer, more complex aspect of architectural culture."
The country house is one of Britain's most important contributions to the arts and western culture. In the words again of John Harris:
"The unity of a great house with its furnished interior, collection of pictures and sculpture, its library and family and estate archives, tied within a garden and set in a landscaped park, is perhaps the supreme example of a collective work of art."
Writers and painters whose patrons enabled them to practise their art in country houses include Sidney, Dryden, Pope, Turner, Swinburne and Millais. Landscape gardening has been regarded as one of the fine arts, and according to Lord Clark, English gardens were
"the most pervasive influence that England has ever had on the look of things in Europe."
The PPG7 exception has been attacked on a number of fallacious grounds. It is alleged that the countryside will be ruined by a proliferation of new country houses. The truth is that the history of our countryside is one of intervention, whether through enclosure, agricultural change or the encroachment of industry and suburbia. Too often the altering of the character of the countryside has been an unhappy story, but the great landscape designers—Bridgeman, Kent, Brown, Repton—and the owners of estates have shaped landscapes which we regard as quintessentially English in their beauty and which we cherish as our heritage. As the Historic Houses Association has noted in its submission, for hundreds of years country houses have provided an essential element of the rural landscape in Britain: most of them are surrounded by deliberately created parkland and gardens, and are as much a feature of the landscape as parish churches, hedgerows and the rest of the man-made tapestry that is the countryside in Britain. Of course especially strict care should be taken of the green belt and other special areas and sites, but the real threat to the green belt has come from large and

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poorly designed housing estates. We need a countryside that is cared for, and among the people who will care for it, with an outstanding commitment of knowledge and resources, are the owners of country houses.
It is also wrong to suggest that a choice has to be made between affordable homes and country houses. We certainly need more affordable homes, but we can have both. Indeed, I believe the Government should insist that, as a condition of planning permission, those who build new country houses should be required to provide some additional affordable homes, and do so to a high standard of design and construction.
Clearly, new country houses are not going to be centres of oligarchic economic and political power as country houses were; we do not want social history to go into reverse. However, we can realistically expect that new country houses will bring more investment and jobs to rural areas, at a time when we need to find acceptable land uses other than intensive agricultural production. Tourists come from all over the world to see our country houses. HHA member properties open to the public employ around 10,000 people. So long as policy is supportive of this part of our heritage there is every reason to think that tourists will continue in the future to come and view country houses old and new, to the benefit of rural employment and the rural economy.
Without the continuation of the country house building tradition it will be harder to perpetuate craft and woodland skills. The parkland of country houses also provides sanctuary for archaeological remains, as well as for plant, insect and bird life, and rare breeds of animals.
It is not easy, of course, for local planning authorities to deal with applications for country houses. They are, however, a type of scheme that already falls under the criteria for local authorities to consult CABE, which, in its formal response to the Government's consultation, has made it clear that it strongly opposes the ending of the country house exception. CABE has said that it would be happy, as now, to provide advice on the quality of country house applications under any future equivalent of clause 3.21. With access to CABE's expertise, it is manageable for local authorities to handle such applications, which in any case will never be numerous. The RIBA exhibition showed indeed how successfully local planning authorities have been able to recognise "truly outstanding" design.
I very much hope, therefore, that my right hon. and hon. Friends will reconsider their position on the country house exception. I know that my hon. Friend the Minister fully appreciates the importance of this issue and has been thinking carefully about it. I can see no good arguments for discontinuing the exception; on the contrary, I believe that it would be a tragedy if we were to bring to an end our great history of country house building.
3.46 pm
The Minister for Housing and Planning (Keith Hill): I congratulate my right hon. Friend the Member for Newport, East (Alan Howarth) on securing the debate, and on a very good speech. I am grateful to him for providing this opportunity to debate two important issues: the protection of the countryside and the encouragement of top-quality design.
Turning to the first of those issues, there is a well established national planning policy that new housing development in the open countryside, away from existing settlements, should be strictly controlled. Planning policy guidance note 7, on the countryside, states that isolated new houses require special justification, although what might constitute "special justification" in any particular case is left open. However, one significant example given in PPG7 is when it is essential for a farm worker to live at their place of work.
The Conservatives' last Secretary of State for the Environment, the right hon. Member for Suffolk, Coastal (Mr. Gummer), decided, when PPG7 was being prepared, that it would be appropriate to insert a further specific example of an exception to the general policy requiring special justification for isolated new houses. That, of course, was the exception for traditional, high-quality country houses.
Although the right hon. Gentleman is clearly proud of that addition—indeed, it is commonly referred to as the "clause" in his name—it was not welcomed in the round. Many local planning authorities and, I believe, other rural interests were disappointed and concerned about that proposal. They felt, and have continued to feel, that it was an unnecessary addition which went against the sustainable development principles underpinning PPG7. Nevertheless, despite the concerns expressed, the right hon. Gentleman was determined to proceed with his commitment to opening up a new era of traditional country house building, and the exception duly appeared in PPG7 when it was published in February 1997.
I fear that the effect of the exception has been to invite a mixture of speculative proposals of little or no architectural or planning merit, and—with perhaps one or two exceptions—designs that represent a pastiche of traditional, classical styles, with little evidence of real innovation. Those houses would, no doubt, enable a privileged few to live out their dreams of past grandeur, and a few specialist architects to enhance their reputations. However, such developments have little relevance to the majority of people, who are looking for well designed, affordable homes for themselves and their families; nor do such developments improve standards or push forward the frontiers of design.
The incoming Labour Government of 1997 inherited PPG7 with its country house exception. We had many other priorities and problems to tackle after the years of Conservative rule, but in due course we reached PPG7. In April 2001, just prior to the general election, my right hon. Friend the Member for Stretford and Urmston (Beverley Hughes), who was then an Under-Secretary at the Department of the Environment, Transport and the Regions, said, in response to a parliamentary question:
"The Government believe that there is a need for more affordable housing in rural areas, and do not see the current planning exception for isolated large dwellings which may be built in unsustainable locations as consistent with that priority, or with its objectives for the countryside more generally. We therefore intend to consult on amendments to PPG7 to remove the exceptions policy which allows such large dwellings to be built."—[Official Report, 23 April 2001; Vol. 367, c. 82W.]
That proposed consultation had to wait for our re-election in the spring of 2001, but following our return. the Government announced that they were to embark

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on a major reform of the planning system. That would include the review of planning policy guidance notes, and their eventual replacement with shorter, sharper planning policy statements. PPG7 was subject to early review, and that led to a public consultation draft of a new PPS7 on "Sustainable Development in Rural Areas" being issued last September.
PPS7 reflects the Government's key priorities for rural areas: delivering inclusive, sustainable country towns and villages that have a high-quality environment; supporting strong, diverse economic activity, with support for our farmers to enable them to remain competitive in changing markets; continuing protection for the quality and character of the countryside, and enabling all to enjoy it. PPS7 also recognises the importance of planning when it comes to providing housing, particularly affordable housing, to meet local needs in rural areas. However, in line with the April 2001 announcement, draft PPS7 did not include the country house exception.
The Office of the Deputy Prime Minister has received nearly 600 responses to the consultation draft of PPS7 from local planning authorities and a range of other interests. Overall, there has been a positive response to the broad policy proposals in the draft, although there have been many varied views on specific policies. Not all commented on the omission of the country house exception, but of those who did, the majority welcomed our proposal.
However, I recognise that contrary views have been expressed, both through the PPS7 consultation and more generally; for example, through the appeal launched by The Architects' Journal. I understand and have been listening to those counter-arguments, including those put forward by my right hon. Friend. I very much agree with him that rural areas, as well as their urban counterparts, should benefit from high-quality design, including the best of contemporary British architecture.
My right hon. Friend has generously acknowledged the passion for good design felt by the Government, and in particular by the Deputy Prime Minister. The emphasis on good design is recognised as a key way of ensuring that the planning system delivers a quality outcome. That is why, as my right hon. Friend for Newport, East noted in his speech, we introduced the concept of design statements in the Planning and Compulsory Purchase Act 2004, and it is why the consultation draft of new PPS1 on "Creating
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Sustainable Communities" makes it clear that high-quality design, promoted through planning policies, is a key element of achieving sustainable development.
Good design is essential for achieving inclusive, successful and vibrant communities. PPS1 advises that design policies and guidance should focus on encouraging good, inclusive design and avoid stifling innovation, originality and initiative. Such polices and guidance recognise that the qualities of an outstanding scheme may exceptionally justify departing from those policies. That is a strong message that I want to see applied equally to rural and urban areas.
We have included as one of the key principles of draft PPS7 that all development in rural areas should be well designed, in keeping and in scale with its location and sensitive to the character of the countryside and local distinctiveness. The draft also encourages planning authorities to take a positive approach to innovative, modern designs.
My concern is to drive up the design standards of all housing in rural areas, not just that of big private houses, in terms of visual interest and impact, the innovative use of materials and construction, and a reduced impact on environmental resources. I believe that our best architects and architectural practices have an important role to play in that respect. However, I recognise that innovative, cutting-edge design can sometimes be helped along by private commissions. In that way, higher risk design solutions can be trialled and proven before being taken up more widely.
I have given careful thought to these matters in the context of PPS7 to see whether there is scope in the final version to provide further encouragement for top-quality housing design in rural areas. I have given careful consideration, too, to the many other views expressed on the consultation draft.
I hope that my right hon. Friend will understand that I cannot anticipate the outcome either in terms of the proposed withdrawal of the country house exception, or of the other policy proposals. However, we are nearing completion of the final text and, with the agreement of my ministerial colleagues, I hope to be able to publish the final version of PPS7 shortly.
Mr. Deputy Speaker: I thank the Minister for his reply. I think that the Minister responsible for fisheries has arrived in the nick of time and we can proceed with the next debate straight away.
The hon. Member for Banff and Buchan (Mr. Salmond) has sought the permission of the hon. Member for Orkney and Shetland (Mr. Carmichael), who initiated the debate, the Minister and the Chair to participate in the debate and I am delighted that he should do so.

UK Fishing Industry
3.57 pm
Mr. Alistair Carmichael: It is a rare occasion indeed on which you, Mr. Deputy Speaker, the Minister and I are of a single mind, as we find ourselves to be in relation to the participation of the hon. Member for Banff and Buchan (Mr. Salmond).
It is both a pleasure and a slight irritation to have this debate here and in these circumstances. It is a pleasure because to my constituency and many other fishing constituencies, this matter is of exceptionally high importance. It is an irritation because it is at least three months since the report was published and a 30-minute debate—in fact, it is a 33-minute debate, courtesy of the Minister who spoke previously—in Westminster Hall does not do justice to such an important subject. I hope that this debate might be a taster of a longer and more substantial debate in the not-too-distant future on the Floor of the House.
I welcome the news that the Minister is to visit Shetland towards the end of July. We look forward to seeing him there. I have already had correspondence with him regarding his itinerary. As well as meeting the usual suspects, if I may bracket them like that—the local council, the local fishermen's organisation, the salmon farmers association and the other commercial agriculture interests—all of whom tend to come through London, where he could no doubt see them all if he chose to do so, I hope that he will meet some others. The real benefit of his visiting Shetland is to meet not just those people, but some of the heavily fishing-dependent communities in Shetland.
I have already referred in correspondence to the community of Whalsay, which is perhaps one of the most fishing-dependent communities anywhere in Scotland by virtue of its economy and geography. If the Minister can find time in his programme in Shetland to visit Whalsay, it would be greatly valued by people there and throughout Shetland. It would be seen as a practical example of his finding out for himself the impact on communities and families at the sharp end of some of the things that we occasionally tend to discuss in the abstract.
The Prime Minister's strategy unit report is a substantial piece of work running to some 217 pages, and I welcome a lot of it. A work of this nature that aims to be substantial and comprehensive is long overdue. Due to the time constraints, I will concentrate on the negatives of the report, but I want to stress that there is a great deal that is good and that the Government are to be commended on having undertaken such an exercise.
Since three months have passed since the publication of the report, what I would like to hear from the Minister today is: where is it going now? Who in Government has ownership of the report and what is their road map for implementing it? When the report was published, the fishing industry raised a number of substantial and fundamental concerns about some of its contents. I presume that he has been in dialogue with the industry about that. and I hope that he will tell us exactly what the Government's view is at this stage.
One of the most substantial areas of concern was the report's calculation of the size of the white fish fleet. The significance is that certain assumptions are made about
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future decommissioning and tie-up that are based on the purported size of the fleet. I submit to the Minister that, if we start from the wrong base and try to decommission further, we will end up with a white fish fleet that has fallen beneath the critical mass that is needed for a recovered industry.
The report calls for 69 trawlers to be scrapped and another 160 to be tied up for four years. Given that the industry estimates that there are 120 white fish boats in the fleet, one can see the significance of the report's calculations. At the time, it was speculated that the strategy unit's over-estimate of the size of the fleet was caused by the inclusion of prawn boats in the figures, because they often catch white fish as a by-product.
At the time of the report's publication, Mike Park, then chairman of the Scottish White Fish Producers Association, said:
"They have assumed everyone holding a white-fish licence is fishing for a targeted demersal fishery, which is utter nonsense. The majority of vessels within Scotland with a category A licence catch prawns, but they need the licence to land white fish as a by-catch. There are only 120 dedicated white-fish vessels left in the Scottish fleet compared with 290 three years ago."
Hamish Morrison, the chief executive of the Scottish Fishermen's Federation, estimated that the size of the entire UK white fish fleet could be no more than 250 trawlers and not the 1,012 claimed by the strategy unit.
That is obviously fundamental, and it underpins everything else in the strategy unit's report. Where there is such a wide divergence of the views and figures held by the industry and the strategy unit, unless or until the matter is resolved, the credibility of the report in the fishing industry will be seriously undermined.
One suggestion made at the time by the chief executive of the Scottish Fishermen's Federation was that the National Audit Office should look at the methodology and conclusions of the strategy unit with regard to the composition of the white fish fleet. Will the Minister tell us today whether the Government are prepared to undertake that? I suggest to him that the National Audit Office brings with it a degree of independence and a reputation for objective scrutiny that would be of immense assistance to all of us who wish to see the good points of the report advance.
As I said, following on from the assessment of the size of the fleet, there is a worrying recommendation for further decommissioning. The figures suggested by the strategy unit are that there should be a further 13 per cent. of decommissioning and that 30 per cent. should be tied up for the next four years. As I read it, the report says that 13 per cent. decommissioning would cost some £50 million in public spending, but that there would be no money available for Government support for tie-up. The report goes on to state that the industry itself cannot afford to tie up for that length of time, so I do not understand how the Government will square that circle. Perhaps the Minister can explain today his thinking about the situation.
I cannot envisage further decommissioning within the Shetland fleet and the communities that I represent. The Shetland white fish fleet has fallen from 27 trawlers to 14 in just over two years. Given that about 30 per cent. of our local domestic product in Shetland is dependent on fishing in one way or another, we must question what critical mass would remain for the white fish industry

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and, following on from that, for Shetland as a whole. If the critical mass is lost in the fishing fleet, the onshore processors, engineers. chandlers and everyone else who depends on fishing will be lost, and once that happens, a substantial proportion of the community will be lost.
Once those jobs are lost in a community such as Shetland, people will not sit around waiting for things to change and get better; they have skills, and they will move on to make a living elsewhere. Such losses are never reflected in our unemployment statistics, because when people lose their jobs they leave the community. As the constant threat in a community such as Shetland is one of depopulation, the stakes for which we are playing in this matter are exceptionally high.
Mr. Alex Salmond: Would the hon. Gentleman, who shares my experience, care to reflect on how little—indeed, it is none—of the economic help through decommissioning, for example, feeds down to the supply-based businesses that are the lifeblood of his communities and mine?
Mr. Carmichael: I have been a supporter of decommissioning, inasmuch as we all have, as there was clearly a need to help people to leave the industry with some dignity, because the alternative was decommissioning by bankruptcy, but the hon. Gentleman is absolutely right: there has been no trickle down. In fact, the net gainers from decommissioning have been the clearing banks. It is unfortunate that more could not have been done to maintain the position of the ancillary businesses to which I have referred.
The other aspect of the report that I wish to consider today relates to the Government's suggestion that we should adopt an aim of progressively regionalising the management functions of the common fisheries policy. The Minister knows that, like many people who deal with the fishing industry, I am sceptical about whether the common fisheries policy is capable of reform. We went through the whole process that ended up with the Fisheries Council in 2002, which gave us the curious creatures called regional advisory councils. That is not regional management, and it is certainly not what I wanted to see when I stood on a platform of regional management in the CFP in the last general election. Nothing that I have seen since makes me think that there is any political will in the European Union, and in the Commission in particular, to devolve power for day-to-day fisheries management to anything resembling regional management councils.
We have at last got a blueprint for the establishment of regional advisory councils. It is estimated that the first plenary council of the North sea regional advisory council will meet in November, about six weeks before the December Fisheries Council. I wish the regional advisory councils well, but I am sceptical, as I do not believe that they have the necessary powers. I fear that they will comprise stakeholders whose views are already nominally listened to but then ignored, and that all we will do is move from a process in which those people's views are informally listened to and ignored to one in which their views are formally listened to and ignored. That is not the progress that I want.
The Minister must realise that there is a degree of scepticism. What plan does he have to achieve the stated aim of a progressive regionalisation of the management functions of the CFP between now and its next reform in 2012? A pious hope was perhaps good enough in the run-up to the 2002 Fisheries Council, but I am afraid things have moved on to such an extent that that will simply not be enough anymore.
Finally, I want to deal briefly with a couple of issues that are not in the report. First, the report's conclusions and recommendations make no mention of the importance of sea food processors. That sector is also under the cosh, not only because of the situation in the catching sector, but because of importers. Given that the sector accounts for 10,000 jobs in some fragile and vulnerable communities, we need to see some clearer thinking from the Government on that front.
Finally, there is the question of industrial fishing. The Government have had a lot to say about what we should be doing in terms of decommissioning and further tie-up, but the strategy unit report does not seem to address the fact that substantial harm is being done to the ecosystem in the North sea by industrial fishing, particularly by the Danish fleet and by other countries that are now involved in multiple rig trawling. Such conservation issues have to be taken seriously, but there seems to be no place for them in the strategy unit report.
In order to allow the hon. Member for Banff and Buchan to make a short contribution and to hear what the Minister has to say, I conclude my remarks.
4.13 pm
Mr. Alex Salmond: I warmly congratulate the hon. Member for Orkney and Shetland (Mr. Carmichael) on winning this debate and thank him for his courtesy in allowing this short contribution. In return, I endorse every argument that he has put forward to the Minister.
Given the time constraint, I want to touch on only one point, which is what the hon. Gentleman called the "pious hope" in the strategy unit about regionalisation of the common fisheries policy. I put it to the Minister that that is totally incompatible with the Government's allowing exclusive competence over the bulk of fisheries policy to be enshrined in the European constitution.
I do not have time fully to go through the history of how we got into this disastrous position, but it is reasonably well known that during the accession negotiations in the early 1970s, the Government of the day effectively gave away the central legal title over the fisheries policy of this country. That was followed by court judgments in 1976, the first of which was the Kramer judgment, in which the European Court of Justice indulged in Euro-creep and pooled exclusive competence into the purview of the European Commission.
That was a court judgment based on a treaty of accession. What the proposed constitution does is to sanctify and entrench that in one of only four exclusive competences of the European constitution. Those are proposed to be: monetary policy for those in the euro; the customs union, the very foundation of the common market; the commercial policy of the single market; and the conservation of marine biological resources under the common fisheries policy. Everything else—

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agriculture, energy, social policy—in the full range of European Union policies has to be a shared competence, but not the bulk of the common fisheries policy. The importance of that is twofold.
First, anything that is a shared competence comes under the protection of subsidiarity. A point that the Foreign Secretary and the Prime Minister have made much of recently is that shared competences actually give an avenue and a protection for powers to be returned to member states; indeed, for member states to have pre-eminence where they can act better than the Union as a whole. Specifically in the European constitution, exclusive competences are removed from the protection of subsidiarity. I seriously doubt that the Prime Minister was even aware of the importance of what he signed up to. In an exchange in the House on 20 April with my hon. Friend the Member for Moray (Angus Robertson), the Prime Minister said:
"Fishing is still a shared competence, and we happen to believe that is right."—[Official Report, 20 April 2004; Vol. 420, c. 171.]
Presumably the Prime Minister could not possibly have been misleading the House, so we must assume that at that stage he was not even aware of the importance of fishing as an exclusive competence of the European Union.
Secondly, the Fisheries Minister told us on 11 March in a Standing Committee that he was
"not an enthusiastic supporter of the common fisheries policy."—[Official Report, Standing Committee A, 11 March 2004; c. 19.]
The strategy unit has held out hope of the regionalisation of management functions of that policy. Our point today is: how is that compatible with a European constitution, which entrenches fisheries as an exclusive competence of the European Union? If there were a genuine desire and move to return at least some control of fisheries to the states—to the fishermen, the people who depend on the resources, and the communities for whom it is their lifeblood—that would not have appeared in the European constitution. The Government, unlike that of 30 years ago, would have made some attempt to defend the rights of our fishing industry.
I should like to make one final point. I am a vice-convenor of the European movement. I support the European cause and have done so throughout my political career. However, I shall not join the long litany of political parties and politicians who will sacrifice and jeopardise this vital industry on the altar of their politics. It is high time that the industry was given the priority in Government policy to which it is not accustomed, but to which it is certainly entitled.
4.18 pm
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Mr. Ben Bradshaw): I thank the hon. Member for Orkney and Shetland (Mr. Carmichael) for securing this debate on a very important report: the first strategic report on the state of the fishing industry in this country, if not for a generation, then probably ever. He remarked at the outset that he was sorry that the debate was happening in Westminster Hall, and with relatively poor attendance—the business being what it is today—and I, too, hope that we shall have an opportunity to discuss
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this further on the Floor of the House. We shall certainly be looking for a slot to do that. I was also pleased that he generally welcomed the Report and emphasised at the beginning of his speech that, as is usual in these cases, one tends to concentrate on the negative, in the hope of getting a response from Ministers.
I also thank the hon. Gentleman for his kind suggestions on how I should spend my time when I visit his constituency, as I hope to do at the end of July. I cannot remember a visit that has engendered so much interest, which is probably a good indication of the level of interest in this matter in his constituency, and of its economic and social importance to his constituents. I look forward very much to my visit, although I fear already that I shall disappoint some people in terms of what I can and cannot do, but I intend to spend a day and a half there, which I hope will give me a good opportunity to see a lot and to meet as many people as possible.
The Prime Minister's strategy unit took a long, hard look at our fishing industry and where we should like it to be in 10 or 20 years. It is timely, because we all know of the difficulties that the white fish sector, in particular, has been suffering for some time. The report paints a very positive message: it says that the industry as a whole, including the white fish sector, has a sustainable and profitable future, provided that we do not shirk the task of addressing certain fundamental problems.
In summary, the basic message of the report is as follows: the industry must ensure the quality of its product and take steps to compete on the global market; some further reduction in the UK white fish fleet will be needed—I shall come on to the controversy about numbers in a moment—to make it economically viable; compliance and the quality of catch data must be improved in the UK and throughout the EU; we must progressively regionalise fisheries management both at the EU and national level and make it more flexible and responsive to fishermen's input; fishing must be integrated more fully into the broader marine management process, with a balanced set of rights and responsibilities; and the Government must adopt policies that recognise and support vulnerable fishing-dependent communities. I do not think that right hon. and hon. Members here today would disagree with any of that.
The Government have already said that they accept the report's broad conclusions, but the detail of how to put them into effect should now be the subject of full discussion among all interested parties, not least because action is required from the fishing industry and the wider range of users of the marine environment, as well as from the Government.
I shall move on to the process of where we go next in a moment, but let me address some of the issues that the hon. Gentleman raised about the strategy unit report. First, he expressed some disappointment with the extent of common fisheries reform so far, and asked whether this was the end. It certainly is not, and we are thinking all the time about how we can push CFP reform further. We achieved a significant reform in the Council the December before last, much of which is only now being implemented. As the hon. Gentleman said, the first regional advisory council for the North sea hopes to

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meet this autumn. That was agreed at the last but one Council of Ministers meeting, which also agreed funding for regional advisory councils.
Things are happening, although there was quite a lot of scepticism when the process was set up that it would be just window dressing or a talking shop. I do not believe that the Commission would have agreed to set up such a structure if it was not going to take any notice of it. In the discussions that I have had—I had one yesterday on the issue of extra days for the white fish fleet under the haddock permit system—there is a recognition right at the top of the Commission that business as usual is no longer tenable. As illustrated in the strategy unit report, we would like to have regional managers, responsible for managing the industry in parts of the United Kingdom. Those individuals would be answerable to the regional advisory councils.
The hon. Member for Banff and Buchan (Mr. Salmond) raised the old chestnut, as he always does, of how there can be any meaningful regional management element to the CFP as long as the part—he generally avoids this point—of the policy relating to the marine environment remains an exclusive competence. I use the word "remains" because it always has been an exclusive competence of the CFP. We are going to have to agree to disagree on what the constitution says and whether it makes any difference. That seemed to me to be the major plank of his party's campaign during the European elections in Scotland, and it did not do him a lot of good.
Mr. Salmond: Will the Minister give way?
Mr. Bradshaw: If the hon. Gentleman does not mind, I will not. We have all been very generous to him in allowing him to contribute to the debate, and I want to respond to several points that were made by the hon. Member for Orkney and Shetland.
The strategy unit suggested a number of other reforms such as setting up a marine agency in the UK. The Government are considering that; it is a medium to long-term measure, but as with other matters, we shall keep the momentum of reform going.
The report mentions processing, but it is largely concerned with the catching sector. It emphasises the economic importance of the processing sector, and its success in various parts of the country, not just in relation to fish caught by the domestic catching sector. We must also bear it in mind that when we discuss the industry, we are talking not just about the catching sector, but about processes, the food industry and so on. Much of that industry is doing very well and, as the strategy unit suggests, a lot of it could do better if we were better at adding value to what is a wonderful, natural resource.
Mr. Salmond: North of the Tay, from Dundee northwards, the Scottish National party was the leading party in the European elections, as the Minister knows. He referred to part of the fisheries policy. I have a letter from the Foreign Secretary, dated 26 August last year, which says that fisheries policy falls mostly within the area of exclusive competence.
Mr. Bradshaw: Yes, but the hon. Gentleman is aware that inshore fisheries and so on are matters of national competence.
I want to address a point made by the hon. Member for Orkney and Shetland about the size of the fleet. There still seems to be some confusion about that because originally the industry was talking about 157 boats in Scotland but, according to the hon. Gentleman, it is now talking about 120, and the official figure from the Scottish Executive was 370. My understanding is that there have already been discussions between the strategy unit and the industry in Scotland, and the reason for what the industry sees as the inflated number in the original report was that nephrops and saithe boats were included. I understand that consensus on numbers has now been reached. If that is not so, I am happy to look again at a possible role for the Audit Commission because it is clearly important that we all base our discussions on similar numbers. What I do not want is to have an argument about boat numbers ad nauseam as a means of avoiding some of the decisions that might have to be made on other issues.
The hon. Gentleman referred to decommissioning, which is a sensitive issue, particularly in Scotland. The strategy unit report recommends further decommissioning, and we shall have to discuss that in depth with the industry before deciding on the details of how to proceed. We shall certainly listen to the arguments of the hon. Gentleman, the hon. Member for Banff and Buchan and the industry, and I shall not prejudge the outcome of those discussions this afternoon. In the end, what happens in Scotland will be a matter for Scotland's Fisheries Minister and not for me.
Mr. Carmichael: The Minister will be aware that Jack McConnell, Scotland's First Minister, has already discounted the possibility of further decommissioning. Given the dominance of the Scottish fleet within the white fish sector, does that not mean that it is finished as an idea?
Mr. Bradshaw: I am not sure that the hon. Gentleman is giving a fair representation of what the First Minister said, but the strategy unit is clear. We are not discussing anything in the short term and I am about to explain briefly how we will proceed.
We will launch the process of engagement with interested parties very shortly. That will involve three levels of engagement to ensure that everyone with an interest has a way of feeding in their views, concerns and suggestions. First, there will be a system of working groups to enable those with knowledge and experience relevant to particular issues, from outside Government and within, to feed in their analysis and suggestions. Obviously, the fish catchers will have a significant role reflecting their absolutely central interest, but we shall also need significant input from the wider fishing industry and from the wide range of other interests with a stake in or concern for the marine environment.
Secondly, there will be a higher level stakeholder advisory group, representing all interest groups, to enable the members of the entire community of interested parties to add strategic level comments to the work coming out of the working groups. Thirdly, there will be a more general engagement based on a consultation letter and a website where all-comers can check the state of thinking and feed in comments.
What we want to come out of this is a Government response informed not just by the comments of all stakeholders, but by active discussion with them, and an action plan for delivering the changes and improvements highlighted in the report, "Net Benefits".
Obviously, I cannot highlight the details of the response and the action plan now as they must emerge from the comprehensive engagement process that we have planned. We want a plan that addresses the whole range of issues identified by the strategy unit and does not cherry-pick some issues for attention and leave out others. The way forward, when it is adopted, must respect the analysis of the strategy unit and address the
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problems that it identified. If the plans adopted are different from what the strategy unit recommends, they must still address the underlying problem.
I and my colleagues look forward to a constructive discussion on the way forward. This is the first time for many a long year that the chance has come along for those concerned about the future of fisheries and their place in our society, economy and the marine environment to come together to create a better future. We must not pass up that opportunity.
Question put and agreed to.
Adjourned accordingly at twenty-nine minutes past Four o'clock.