Written Statement of 26 March 2003

LORD CHANCELLOR

  Effective Enforcement
  The Parliamentary Secretary, Lord Chancellor's Department (Yvette Cooper)
  My noble Friend, Baroness Scotland of Asthal, Parliamentary Secretary, Lord Chancellor's Department, has today announced the publication of the White Paper "Effective Enforcement" which sets out legislative proposals to improve methods of recovery for civil court debt and commercial rent and a single regulatory regime for warrant enforcement agents.

  It is crucial that creditors who have established a legitimate claim should be able to pursue it through a straightforward and accessible system, and if necessary enforce a judgment by the most appropriate means. Equally, debtors who genuinely do not have the means to pay should be protected from the oppressive pursuit of their debts.

  The White Paper contains detailed proposals for a single regulatory structure, unified law and a fairer fee structure for all enforcement agents to enable straightforward, effective warrant enforcement and protect vulnerable debtors who genuinely cannot pay. The paper also sets out revised procedures for attachment of earnings and charging orders and improved access to information to assist enforcement.

  The paper builds on the Green Paper "Towards Effective Enforcement", published in July 2001 and the responses to this consultation paper, published in May 2002.

WORK AND PENSIONS

  Pathways to Work
  The Secretary of State for Work and Pensions (Mr. Andrew Smith)
  The Department of Work and Pensions laid before the house on 18 November 2002 a consultation document entitled "Pathways to Work—Helping People into Employment". This document sets out the next steps in the Government's welfare to work strategy for people with health problems and disabilities. It recommends piloting a number of innovative measures to help people to return to work where they have the capability and expectation of doing so. I will be announcing the detailed outcome of the consultation exercise in due course. In the meantime my Department, together with the Department of Health and appropriate Scottish Executive and Welsh Assembly officials, are preparing for the implementation of the Pilots.

  I am pleased to announce that the first tranche of these Pilots will start in late October 2003, in the Jobcentre Plus Districts of Bridgend, Derbyshire and
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  Renfrewshire. The Pilots will test and evaluate the impact of the extra support we will provide for those sick and disabled people who want to go back to work. Further pilot locations, to commence from April 2004, will be announced in due course.

TRADE AND INDUSTRY

  Export Credits Guarantee Department
  The Minister for Women (Ms Patricia Hewitt)
  In previous statements to the House on 22 July 2002,Official Report, columns 779–78W, and 17 December 2002, Official Report, column 45WS, I reported on the Export Credits Guarantee Department's (ECGD) progress towards being established as a Trading Fund.

  The Government recognise the important contribution exports make to the UK economy. Capital goods exporters, in particular, attach a great deal of importance to ECGp support, pointing to its value in helping them secure business in competitive overseas markets.

  Last year, the Government made a firm commitment to ECGD's stakeholders to maintain the level of ECGD support at broadly the current level, and to tackle unfair export credit subsidies on a multilateral, and not a unilateral basis. The Government therefore remain committed to maintaining the level of ECGD support at broadly the same level as it provides now.

  I am publishing today a study by National Economic Research Associates (NERA) on the costs and benefits of ECGD's support to exporters and investors overseas, which I commissioned last year jointly with the Chief Secretary to the Treasury. Copies have been placed in the Library of the House.

  This report builds on the earlier NERA report that concluded ECGD should continue to provide cover for medium to long term capital goods exports, because it was likely that the market was failing to work effectively. However, it also concluded that the justification for providing subsidy through ECGD is weak, although the Government's view remains that any attempt to eliminate the subsidy should be done only on a multinational basis.

  The report I am publishing today suggests a wide range of possible costs and benefits from ECGD's business over the last 10 years; and to maximise the benefits in the future proposes an approach to pricing and managing risk which reflects the full costs of the business supported.

  My right hon. Friend the Chief Secretary to the Treasury and I met Digby Jones and several of ECGD's key exporter customers earlier this week to discuss the NERA report and the Government's response.

  The Government have listened carefully to exporters' concerns regarding ECGD, and will maintain a dialogue with them as ECGD progresses towards Trading Fund status. The move to Trading Fund status will help ECGD to improve its management arrangements, including operating efficiencies, while offering better levels of customer service.

  Community Interest Companies
  The Minister for Women (Ms Patricia Hewitt)
  A joint DTI/Home Office/Treasury consultation document on proposals for a Community Interest Company (CIC) is being published today. The consultation document sets out the proposals in detail for a new type of company, not-for-profit, and working for the public benefit.

  The CIC will present new opportunities for social enterprises to benefit the people they serve: it will be easy to set up, with all the flexibility and certainty of the company form, and some special features, to guarantee that it is working for the benefit of the community or the wider public. Easy for investors to understand, with an assured lock on profits and assets to attract social investors, it will help create a strong new brand for social enterprise and a new marketplace for social investment. By doing so, it will cut the costs of setting up and financing social enterprises. It will recognise the strong links between social enterprise and the wider community, encouraging stakeholders to engage in enterprising communities. This in turn will improve the delivery of local services.

  The concept of the CIC was outlined in the Strategy Unit report "Private Action, Public Benefit", published in September 2002. The CIC consultation document fulfils the report's commitment to carry out a technical consultation on the concept before legislation. Responses to the Strategy Unit's consultation have been taken into account in developing the fuller proposals in the CIC consultation document.

  The Government's aim is to widen and deepen the enterprise culture in our country, so that everyone, regardless of their background or circumstances, has the chance to go as far as their talents will take them. Our strategy is to support small and medium sized businesses and social enterprises to modernise and reform the delivery of services at local level, regenerate disadvantaged communities and spread the enterprise culture. Several initiatives have been introduced to boost enterprise and community development in our most disadvantaged areas, particularly through the Phoenix Fund. Other measures are focused on Enterprise Areas, such as exemptions on Stamp Duty for all commercial property transactions, the Community Investment Tax Relief, and Bridges Community Ventures. The introduction of CICs builds on these measures, enabling the growth of the Social Enterprise sector, and creating real opportunities for people in areas where they are needed most.

  The Government do not intend that CICs should deliver essential public services in core sectors such as hospitals and schools. Rather, CICs should develop to meet the needs of local communities, complementing core Government services in areas such as childcare provision, social housing, leisure and community transport.

  The key features of the CIC would be an assurance, delivered through an independent regulator, that profits and assets would be used to deliver the objectives of the company, which would be for the benefit of the public and the community. Otherwise, the companies will have the same freedoms and responsibilities as any other company. It is proposed that the regulator will apply a
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  statutory community interest test, namely that a reasonable person could regard a CIC's purposes as being beneficial to the community or the wider public interest, and that its purposes are not for private benefit.

  Some restrictions on the freedom of CICs to raise risk equity are also proposed, in order to preserve the lock on profits and assets. It is proposed that dividends should be limited to returns within a ceiling to be set by the regulator, and that investor shareholders would be able to influence, but not control, the direction of the CIC.

  In addition to the normal publication of company reports and accounts, CICs will have to report to the regulator on action to promote the public benefit, including action to involve stakeholders. Views are sought on whether, in addition, there should be a statutory requirement to consult stakeholders, with an exemption for smaller CICs.

  The core functions proposed for the regulator are: to check that applicants are non-profit distributing companies working for the community benefit, to publish CICs reports on action taken to promote the public benefit, and to ensure that when a CIC is wound up, any residual assets after creditors have been paid in the normal way will be used for the public benefit. It is proposed that the regulator will have powers to take action in order to protect the integrity of the CIC brand. It is envisaged that these powers would normally be exercised through publication of information and investigation of complaints, rather than intrusive monitoring.

  Copies of the consultation document are available in the Libraries of the Houses and on the DTI website. We welcome views on all aspects of the proposals outlined in the paper by Wednesday 18 June 2003. An indicative regulatory impact assessment is included with the consultation document.

EDUCATION AND SKILLS

  Local Education Authority Grants
  The Minister for School Standards (Mr. David Miliband)
  I am today announcing an increase to schools' budgets for 36 authorities that have received a low increase in their Education Formula Spending Share and a reduction in grant through the standards fund.

  We have made radical changes to the formula for distributing general education funding for 2003–04, particularly for schools. The funding intended for schools and LEA central functions is separately identified through the schools and LEA block; there is a new formula for distribution; and, to smooth the introduction of the new education formula, all authorities will receive at least a 3.2 per cent. increase in Education Formula Spending Share (Education FSS) per pupil. At the same time, we have made changes to grants paid through the Standards Fund. The overall cash increase in general funding for LEAs and schools is £2.6 billion for 2003–04.

  Authorities have been working hard to ensure that this extra funding reaches school budgets. However, the Government have received representations from local

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  authorities, schools and head teacher representatives about the effects of the new financial system for a number of LEAs in the short term, and we recognise that in some authorities the combination of a low increase in Education FSS, coupled with reductions in grant through the Standards Fund may result in low budget increases for schools. In the light of this, we propose to pay an additional grant of £28 million to ensure that the effective increase in education funding for LEAs and schools between 2002–03 and 2003–04 is no less than 3.2 per cent. per pupil for all authorities. Education funding includes both Education FSS, School Standards Grant and certain Standards Fund grants: a detailed specification of the grant will be made available to all local education authorities; and a copy will be placed in the House Library.

  The schedule below sets out the receiving authorities and their allocations: it is based on an estimate of the increase in School Standards Grant (SSG) for 2003–04, and will not be amended downwards when we have actual amounts of SSG paid to each authority. It will be a condition of the grant that authorities will have to pass it on in full to schools: we will expect authorities to allocate the grant to those schools that currently have the lowest increases in overall funding per pupil. We expect that this extra funding for school budgets will be of particular relevance in taking forward the workforce remodelling agenda.

  Grant

  LEA

  (£m)

  Barking and Dagenham

  1.128

  Bedfordshire

  0.135

  Bexley

  1.492

  Bournemouth

  0.140

  Brighton and Hove

  0.960

  Bromley

  0.815

  Camden

  1.168

  Croydon

  1.302

  Dorset

  0.318

  East Sussex

  0.110

  Enfield

  1.147

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  Grant

  Essex

  1.162

  Hammersmith and Fulham

  0.886

  Hampshire

  0.278

  Haringey

  1.330

  Havering

  1.089

  Hertfordshire

  1.000

  Isle of Wight Council

  0.110

  Kensington and Chelsea

  0.288

  Knowsley

  0.736

  Lambeth

  1.282

  Leicestershire

  0.835

  Medway

  1.295

  Norfolk

  1.595

  North East Lincolnshire

  0.033

  Plymouth

  0.831

  Portsmouth

  0.891

  Redbridge

  0.903

  Richmond upon Thames

  0.152

  Slough

  0.376

  Southampton

  1.016

  Southend

  0.358

  Suffolk

  0.108

  Sutton

  0.503

  Thurrock

  0.308

  Waltham Forest

  2.140

  Total

  28.220

TREASURY

  Finance Bill
  The Paymaster General (Dawn Primarolo)
  Legislation will be introduced in the Finance Bill 2003 which will counter tax avoidance used by individuals attempting to exploit the 100 per cent. rate of capital allowances available for expenditure on information and communications technology. The legislation will prevent first year allowances being available to anyone who exploits software or software rights by the granting of rights to use or otherwise deal with that computer software. The measure will apply to expenditure incurred on or after today.