15/12/2016 House of Commons

said, I nevertheless would like to wish the Secretary of State and all

colleagues are very Merry Christmas. The Secretary of State for

Communities and Local Government. Apply to Michu Merry Christmas and

am sorry to hear that the statement arrived late. I understand from my

office that was 1115. That was not my intention that I apologise if the

opposition received it late. Local Government accounts for almost one

quarter of public spending and it is making a significant contribution to

reducing Labour's record-breaking budget deficit. Councils have dealt

with this admirably, public sector two satisfaction with local services

has been maintained. -- public satisfaction that there is much that

public sector can learn from councils across the country when it

comes to delivering value for money. No one is disguising that more can

be done to improve efficiency and further transform services. In last

year's spending review we delivered a flat cash settlement for local

Government that gives councils more than ?200 billion to spend on

services over the course of this Parliament. In February we published

an historic four-year offer for councils providing the certainty

that they need to plan ahead. I'm pleased to say that 97% of councils

have taken up the offer and met our expectations of reform by publishing

a long-term efficiency plan. This means that almost every council in

England is now working with local partners in the NHS and other areas

to translate this greater certainty into improved services and

efficiency savings. Today my department has published a

consultation that confirms the second year of this four-year offer

for councils. And core spending power figures have been made

available in the library of both houses. The adage Cirstea provided

by the four-year offer will increase stability for councils as we

transition to a world where they maintain 100% of locally raised

taxes to fund local services. -- the added certainty. By 2020 local

councillors will decide how to fund local services using local money.

True localism in action. Moeen welcome a stronger incentives to

support local firms and local jobs may increase business rate revenue

for local Government as businesses expand. In the New Year we will

announce and introduce a bill to provide the framework for a new

system with trials beginning later in the year. The March budget

announced that in London and devolution deal areas of greater

Manchester and Liverpool city region will have pilots of 100% business

rate retention. I can confirm that these authorities averaged

agreements to begin recruiting to pilots in 2017 - 18 and I'm pleased

to say that these will be joined by authorities in the devolution deal

areas of the West of England, Cornwall and the West Midlands. Mr

Speaker, the new homes built as an important part of our commitment to

reward committees and authorities that embrace ambitious

house-building plans. It also vied to what income for councils seeking

to grow their local economies which they can then go on to spend as they

see fit. Since its introduction in 2011 over ?6 billion has been paid

to reward housing supply and over 1.2 million homes have been

delivered but for all its successes, the system can be improved. A year

ago, we consulted on a number of possible reforms to the scheme.

Having studied those results closely, I can confirm today that

from next year we will introduce a national baseline for housing growth

of 0.4%. Below this, the new homes bonus will not be paid. This will

help ensure the money is used to reward additional housing rather

than just normal work. From 2018-19 will consider withholding new homes

bonus payments from local authorities that are not planning

effectively by making positive decisions on planning applications

and delivering housing growth. To encourage more effective planning we

will also consider withholding payments for homes that are built

following an appeal. A consultation on this will take place in due

course. And we will also implement our preferred option in the

consultation to reduce the number of years for which payments are made

from six years to five in 2017-18 and to four years for 2018-19. This

will release important funding for adult social care, recognising the

demographic changes of an ageing population as well as a growing

population. Mr Speaker, I'm sure that all members on both sides of

this house agree on the need for action to meet the growing cost of

caring for some of our most vulnerable citizens. Every year

councils spend more than ?14 billion on adult social care, it is by far

the biggest cost pressure facing local Government. The spending

review put in place up to three and a half billion pounds of additional

funding for adult social care by 2019-20. Allowing local Government

to increase their spending on this service in real terms by the end of

this Parliament. But more needs to be done. Over recent months we have

listened to, heard and understood calls from across-the-board saying

funding is needed sooner in order to meet short-term pressures. Today I

can confirm that savings from the reforms to the new homes bonus will

be retained in full by local Government to contribute towards

adult social care costs. I can tell the house that we will use these

funds to provide a new dedicated to hundred ?40 million adult social

care support grant in 2017-18 to be distributed fairly according to

relative need. I can also confirm the indicative allocations of the

improved better care fund we published last year and at -- that

the Department of Health will surely confirm allocations of the public

health grant to councils for next year. Last year we agreed to the

request by many leaders in local Government to introduce a social

care Council tax precept of 2% a year, guaranteed to be spent on

adult social care. The precept puts me raising powers into the hands of

local leaders who best understand the needs of their community and are

best placed to respond. In recognition of the immediate

challenges that are the care market now allow local councils to raise

this funding sooner if they wish. Councils will be granted the

flexibility to raise the precept that up to 3% next year and the year

after. This will provide a further ?208 million to spend on adult

social care in 2017-18 and ?444 million in 2018-19. These measures,

together with the changes we've made to the new homes bonus, will make

almost ?900 million of additional funding for adult social care

available over the next two years. However, we do not believe that more

money is the only answer. There is a variation in performance across the

country that cannot be explained by different levels of spending. Some

areas have virtually no delay transfers of care from hospital. But

there is a 20 fold difference between the best and the worst

performing 10% of areas. It is vital therefore that we finish the job of

integrating our health and social care systems. We know that this can

improve outcomes and make funding goes further, helping people manage

their own health and well-being and to live independently for as long as

possible. The raw or register with examples of where this works. For

Topal Gobert in Oxfordshire joined up working has seen delayed

discharges plummet by over 40% in just six months. Meanwhile in

Northumberland that area has saved ?5 million through joining up their

local health care trust, reducing demand for residential care by car

percent. The better care fund is already supporting this, with ?5.3

billion of funding between councils and clinical commissioning groups

last year but we also want to make sure that all local authorities

learn from the best performers and best providers so we will soon

publish on integration and better care fund policy framework to

support this. In the long term we will need to develop the reforms

that will provide a sustainable market that works for everyone who

need social care. We also need to recognise that demographic pressures

are affecting different areas in different ways. As in the changing

costs of providing services. We were undertaking a fair funding review to

thoroughly consider how to introduce a more up-to-date and transparent

and fair in needs assessment formula. The review is looking at

all the services that are provided by local Government and will

determine the starting point for local authorities under the 100%

business retention programme. This is an opportunity to be bold, for

bottom-up change, we are working with representatives from local

Government on the review and we will report on our progress to the house

in the New Year. Council tax is a local decision. And local councils

will need to justify social care precept rises to their taxpayers.

The only to show how the additional income is spent to support people

who need care in the area and how it improves adult social care services.

However, it is worth noting the extra flexibility to raise funding

for adult social care next year will add just ?1 a month the average

council tax bill and the overall increase to the precept in the next

three-year 's will remain at 6%, so bills will be no higher in 2019 -

20. In our manifesto we made a commitment to keep council tax down,

and that is exactly what has happened. Since 2010-11 council tax

has fallen in real terms by 9% and by 2019-20 hard-working families

will be paying less council tax in real terms than they were when we

came to power. However, last year we saw a worrying 6.1% rise in precepts

by town and parish councils. That is why earlier this year we consulted

on extending council tax referendum principles to larger town and parish

councils. These councils play an important role in our civic life and

I understand the practical considerations of scale. We have

decided we will defer our proposals this year while keeping the level of

precepts set by town and parish councils under close review. I

expect alternate parish councils to clearly demonstrate restraint well

setting increases that are not a direct result of taking on

additional responsibilities. I am also actively considering with the

sector ways to make excessive increases more transparent to local

taxpayers. This local Government finance settlement on is our

commitment to a four-year funding certainty for councils that are

committed to reform, it paves the way towards financial

self-sufficiency for local Government and the full devolution

of business rates. It recognises the cost of delivering adult social care

and makes more funding available sooner and it puts local councillors

in the driving seat and keep spills down -- keeps bills down for

taxpayers, I commend it to the house. Mr Speaker, this is a

settlement that will lead the people of England paying higher taxes as

getting worse public services for their money. For some this

settlement will still mean support they hoped would be there for an

elderly or vulnerable relative still isn't available while for others

visible public services like street cleaning and rubbish collection will

be cut ever closer to the bone, and even more youth centres and

libraries will close. But it would've been nice to have seen

statement in good time, at least we can be great for the crisis in the

party opposite over the price of a pair of trousers has abated enough

to allow the chief of staff at number ten to what the Secretary of

State can say today. Isn't the real truth about this statement that

there is no new money for local authorities to tackle the social

crisis now? Moving new homes bonus money around in a few years isn't

going to tackle the crisis now. On the 18th of July, when the

Association of directors of adult social services were already raising

the alarm, the Secretary of State in this house said in response to my

honourable friend the member for Easington of social care "I don't

accept it is underfunded". Why has it taken so long for him to spot

there might be a problem after all? This is a crisis that ministers

still don't seem to grasp the severity of. ?4.6 billion axed from

social care budgets as a result of their cuts since 2010. 1.2 million

people according to aid UK not getting the care they need. There

are even senior figures in the minister's on party with a closer

grip on reality than the Secretary of State appears to have, such as

Lord Porter, the chairman of the Local Government Association, who

notes that services supporting our elderly and vulnerable are at

breaking point now. Does he share our view that we did

not need to be in this position. Does he remember how before the 2010

general election, senior figures from his party choose to kill of

serious cross-party talks on how to fund social care going forward. Once

ministers finally began to realise there might be a bit of a problem,

they reached for that old conservative favourite, blaming

councils themselves. Ministers like to attack councils, but isn't it the

truth that councillors and local authority staff up and down the

country are doing their best to block the funding gap, to cope with

huge rising demand for care and increasing costs. When will he

address the worsening postcode lottery for social care? In the most

deprived areas of the country, social care spending fell by ?65 per

person, but rose by ?20 per person in the least deprived areas. Though

he accept that the social care precept rising will only further

entrench this inequality? I ask generally, is this really the best

time to be choosing to cut corporation tax on Amazon Sports

Direct and the big banks? Since Minister came to office, there has

been much talk of help for those who are only just about managing their

finances. That seems to have gone out of the window today, as the

Prime Minister has decided to put up council tax in every part of

England. To borrow from her, if you're from an ordinary

working-class family, life is much harder than people in Downing Street

realise. You worry about your area and services you rely on and you

also worry if you can pay the tax bill at the end of the month. Today,

the Prime Minister decided to make it just a bit harder for them to

manage. On top of council tax rises this year, it's 3% in 2017 and more

in 2018. By 2020, a 17% increase in council tax compared to 2015. All

decided in Downing Street. Who would have thought it? The party opposite,

who once claimed to be in favour of low taxes, putting up taxes every

year until the next election. The truth is, social care is in crisis.

This means worse public services. Isn't it the truth that the people

of England deserve better? Allow me to respond to the Shadow Minister.

First of all, he claims that, as a result of today's news, that there

is no new money. Those were his words. No new money for adult social

care. He could not be more wrong. But if he wants to imagine what a

world would look like with no new money for adult social care, then

that is what would've happened if the result of the last election had

been different. Let's remember what the then Chancellor said. I called,

there will be no additional funding for local government, and he went on

to say, I called, a penny more for local government. The shadow

minister also mentioned the NHS and the important role the NHS plays in

providing adult social care and helping with adult social care.

Let's also remember at the last general election, the Labour Party's

plans were to cut NHS spending by 5.3 billion. Everyone wants to get

in, but if you want to get in, let's hear the Secretary of State. Thank

you. If the Labour Party had had its way, this year, NHS funding would

have been ?1.3 billion lower than it is. What difference would that have

made to people, especially the most vulnerable people, in our society?

We should be grateful that the Labour Party are not in office.

Because what we have seen under this government, when it comes to funding

for adult social care, is first ball in the spending review, an

allocation of an additional 3.5 by 20 20. And now, with today's

announcement, let me focus precisely on his court, where he said, there

is no new money. He is absolutely wrong. There is new money of ?240

million that otherwise would have gone into new homes bonus. And we

have responded to what local councils, many local authority

leaders had asked for, and repurposed that money. And there is

an additional ?654 million, additional money, because of the

precept changes. If the shadow minister cannot work that out, then

he needs to look again at his basic mathematics skills, because taking

those numbers together, that's an additional ?900 million over and

above the spending review settlement over the next two years, of

approximately ?450 million of new money each year for the next two

years. The shadow minister also referred to council tax bills. It

does remind me of something that the shadow adult social care minister

said recently. I quote. She said, asking taxpayers to pick up the bill

is no substitute for a proper plan. Well, I think the shadow government

needs to learn that there is no such thing as government money, it's all

taxpayers' money, whether that is locally raised or nationally raised,

it's all taxpayers' money. I know the Leader of the Opposition

believes in a magic money tree, but I didn't know that you felt the same

way. If we want properly funded services, there needs to be a

balance between those who pay for it, the taxpayers, and those who

actually use those services. That means making the right decisions to

make sure they are properly funded, and at the same time, to make sure

that tax bills don't rise by more than they have to. That's why I am

proud that under this government, even taking into account these

changes, the precept changes we have announced today, that by the end of

this parliament in real terms, the average council tax bill will be

lower than it was in 2010. I welcome the statement today, but can he tell

us that 97% of local authorities have agreed a four-year deal, which

allows them to plan for the future. That does mean that 3% of local

authorities have not. Can he update the House on what the impact of the

local authorities that appeal to agree to a long-term settlement,

what that means for their council taxpayers and the future of their

services? He makes a very good point and it's worth talking about this

more. As he rightly said, the good news was that in terms of the

four-year settlement, 97% of councils accepted it, which means

ten councils did not. Unfortunately, his local council is one of those

councils that did not accept the settlement. What it means in

practice is that there are settlement will be an annual

settlement and it will deny local people the certainty that they seek.

It also means that that local council and the other ten councils

have not put together an efficiency plan like the other councils. It's a

shame those councils did accept it. It's up to them, but it does have

consequences. Would he agree that the statement still leaves like very

challenging indeed the most local authorities dealing with social care

and the crisis it is in? Would he confirmed that the ?900 million on

it was partly to the up ?3 billion gap, which we believe exists by the

end of this spending review? In terms of the new homes bonus money,

why they chose not to pay back through the care fund, where he

could have targeted the money at the Buddhist authorities, who can raise

the least through the precept? In terms of integration, we saw that

Simon Stephens and Stephen Donald came to the select committee

yesterday. They said integration between health and social care was

desirable, but that it was not of itself going to solve the problems

of social care in the longer term. Would he agree to a wider review,

involving the Local Government Association and to try and get

cross-party agreement towards a sustainable agreement for the longer

term? I always take very serious with what the chair of the select

committee has to say, I know he considers these things very

carefully. To answer his questions. In terms of funding for adult social

care, he may recall that, at the time of the spending review last

year, the Local Government Association asked for extra funding.

That spending review provided more at 3.5 billion. Today's

announcements and another ?900 million on top of that 3.5 billion,

so it is a significant increase, even more so when you look back at

what the LGA was considering just last year. He also asked

specifically about the 240 million, the money that otherwise would have

gone into New Homes Bonus, and the allocation of that. He will know

that the Improved Better Care Fund, which has 1.5 billion by the end of

this Parliament, is allocated, taking into account the council tax

raising powers of each area. The 240 million is allocated based on

relative need. I think that the best way to do it. I agree with the

government, we need more money and reform. My local authorities were

short-changed in the past, which is a separate issue. On the general

question, what can be done about the reverse incentive, where if it

council doesn't come up with a primary care package, the person

will stay for longer in a very expensive hospital bed, where they

don't want to be? He highlights this vital issue of more and better

integration between the health care system and adult social care. I

refer him to my statement where we are seeing good practice. I

mentioned Manchester and Northumberland, and many areas can

learn from that, especially when you look at some of the factors, such as

the deep blue transversal care. We want to see more of this, that's why

my department, working with the Health Secretary will be working on

a set of principles that we expect to see implemented as local

authorities access this additional funding. The great city of

Birmingham has been hit hard by the biggest cuts in local government

hastily, ?800 million. With increasingly catastrophic

consequences for public services, in the words of the chief executive on

one hand, and in the words of the chief executive of the YMCA, leading

to more young men and women dying, like the young man who frozen

Birmingham Street in November. Can the Secretary of State begin to

explain why nursery schools last week, schools yesterday and local

government today, Birmingham is left fairly than the Prime Minister's own

constituency of Maidenhead. It cannot be right to put the interests

of the Tory party above the interests of the public. I do think

he should re-examine the figures and make sure you get them right. I have

them here, if it helps. He will know that Birmingham has significant

failings, and that's why there is independent panel put in place by my

predecessor. That failings were significant management areas. Today,

what he is highlighting, he seems to suggest there is a funding issue

with Birmingham. Let me give him the facts. Birmingham, amongst the

Metropolitan districts, it receives currently, or by 2019, will receive

a good amount per person. It is a well funded authority and it is

incumbent on those who run it to run it better for the residents. In four

years' time, Birmingham's money will be going up, but in Worthing, it

would. I think he ought to pay attention to whether planning

permission and is on -- granted on appeal should be looked at. I am

glad he has taken away the referendum on parish council

increases. friend, I know he be pleased by the third reading of the

neighbourhood planning Bill because of the things it tried to address is

to make those lands stronger and easier to get together for local

communities and I know he supports me in that goal. The issue he raises

on appeals and the new homes bonus, as I said, we are minded to deny it

when planning is counted on appeal but your consultation on it and

decide. The shrub but we will consult on it. Liverpool has high

levels of poverty and a very innovative local authority that

believes in value for money but Liverpool City Council has already

lost 58% of central Government funding and yesterday in a reader

should brush and of education funding it lost ?3.5 million more.

What does this statement today to in concrete and specific terms to

address the crisis in social care. Except ask poor people to pay more

and even that will not address this growing crisis of people in need?

The honourable lady, I was in Liverpool just a couple of weeks ago

and met with local leaders including the Chief Executive and I want to

understand directly some of the challenges Liverpool is going

through. The changes we have announced today, some of those will

help Liverpool and other places in that situation, she will know that

better care fund is allocated by taking into account the council

tax-raising power of a local area and that benefits places like

Liverpool and she will also perhaps note today from the statement on the

extra 249 pounds based on needs that will advantage Liverpool and she

will be interested to know that Liverpool boss Matt Cassel tax

spending power per dwelling is rising from 5922 in 17-18 to 2041,

which is a much bigger increase than most other areas in that situation.

-- 1900 mean 22. It is good that more people are living longer, there

has been increased to the people living to make 85 and over and more

than 1 billion 1 million people or you may Cairney is so was their

welcomes of the money will be brought forward I don't feel we are

going far enough in this house to address the scale of the increase in

demand we will allow people to be cared for with dignity in their old

age. Can I join the chair of the DC LG committee in asking the

Government to start cross-party talks urgently to have a long-term,

fair, sustainable settlement for both health and social care? I know

freshly that my honourable friend speech with experience, I know she

has spent a great degree of time looking into this issue, especially

with the work she does on the health select committee and I do take what

she has to say very seriously, one thing I would highlight, if I'm

correct she used the words bring forward spending". It is more than

just bringing it forward, this is a significant increase in spending of

?900 million, just to be clear, this is ?900 million additional over the

next two years where some of the biggest short-term pressures exist

that otherwise would not have happened had the changes not been

announced, this is a significantly new money, not just bringing forward

and I know she would welcome that clarification and she also referred

to speaking widely, including with members of the opposition and I

would include local leaders in that, health professionals and social care

professionals and that is what I intend to do over the coming months

to make sure we can always keep this under review. This is surely a truly

feeble response to a national crisis and the LGA would be entitled to

reject this proposal and put the ball firmly back in the Government's

court to think again. This is an unfair way to raise additional money

which will increase inequalities between rich and poor areas. When

will the Government come forward with plans to work genuinely across

parties? They have been to suggestions already in this Q

session, the Secretary of State hasn't answered either, when will he

work with others to come up with a genuine solution for what is now a

real national crisis? The honourable gentleman will know firstly any

funding provided to a local authority is raised locally through

taxes or through taxes nationally when it comes to finding through

growing. He used the words unfair but he should be aware because he

has experienced in this area, he should be aware that when we

allocate the finding that billions from the better care fund is

allocated taking into account the castle tax-raising power of each

area, that is the bases used for that and I think that is the fairest

way to do that but also giving councils flexibility through the

precept which we have announced that flexibility today so they are in a

better position to meet local needs is also a sensible and fair policy,

where local councils see more demand for services locally they should be

given the power to deal with that. I appreciate the appalling pressure

the Secretary of State is feeling on adult social care but pressing on

his new homes bonus, this is vital in industrial towns to promote

difficult development but what worries me is if a council like West

Lindsey doesn't meet the .4% target if it allows development going

against committee plans and suburban villages where it is easy to develop

their might lose their no new homes bonus and he said to encourage more

effective global planning people also consider withholding payments

for homes built following appeal, is essentialism and goes against

localism and I am urging him to think again, councils should

determine these appeals on their merit on the basis of central

Government diktat. Firstly I would like to assure my honourable friend

that the new homes bonus is staying in place, there are forms announced

which were consulted on and that began in December 2015 and it was

important to make sure that these incentives that remain for house

building for local authorities to not least deal with some local

pressures that come about through more homes in the area. He mentioned

the baseline, committee .4% above the national baseline, he find it

reassuring that is based on historic figures but I look at last year's

figure for the country it was 0.94%, so most local authorities will also

be able to benefit from the new homes bonus and I have listened

carefully to what might honourable friend has said about the appeal,

the possible changes, and we will consider that in the consultation. I

wondered if the secretary of state could tell me quite how Hollies in a

better position to meet local needs were his announcement, the 1%

increase they can levy on the precept will bring into ?700,000,

just 12% of what is actually needed for Hull to address social care

budget after the massive cuts since 2010 and wealthy areas like the East

riding can raise much more with their council tax base and have many

more self funders, so how is that fair that the Government are not

giving Hull what it needs to meet the needs of some of the most

vulnerable people in one of the most disadvantaged areas in the country?

The area that the lady mentions, it will benefit from these changes and

she mentioned the precept, which is an important change because and I

don't have the numbers exactly but it will help. I noticed the

honourable lady did not mention the money that would have otherwise gone

in the new homes bonus which is allocated on relative need and takes

into account the ability for local areas to raise money through taxes

and because it is based on relative need it will have a benefit for

places like Hull. Thank you, I agree with my honourable friend, this is

an opportunity to be bold and for bottom-up thinking and I welcome the

fair funding review but would he not agree with me that until that fair

funding review is completed, taking into account the demographic

pressures of different areas of the country, there should be a

moratorium on losing the committee hospital beds until we really have a

fuller picture of what the local authority can afford and what

central Government is per pair to provide? Of my honourable friend

highlights is, I think, the need for this fair funding review and I hope

he agrees with me that it is about time that we look carefully at the

needs of every local area, including our more rural areas and make sure

funding is distributed taking into account the challenges areas face,

for example in rural areas sparsity creates more challenges and funding

pressures. He will be aware of my predecessor, having listened to some

of these changes, did take some action where he could with some

limited flexibility with the 65 lead and makes it if I blame and rural

services quite for 2018 bid what he rightly highlights is we must look

carefully, as we have here, at the pressures, particularly in rural

areas and act on them. We will take no lectures from this Government

about the funding for social care. They walked away from the

cross-party negotiations about funding for social care before the

2010 elections purely for political gain. They then cut 4.6 billion out

of it in the last parliament saw crisis we have now is created by the

people sitting on those benches over there. 1% increase in the precept

brings in ?670,000 in my local authority, we have a ?40 million

deficit in our expenditure already, this is not going to touch the

sides, as my local leader said. This is just not good enough! We have a

gaping hole and the Secretary of State comes here with a sticking

plaster and it is just not good enough! We need a cross-party

agreement on how to deal with this crisis! It is worth reminding the

honourable gentleman that at the last election he stood on a ticket

that would have led to even less funding for his local authority,

which I believe is Greenwich. And also it would have meant less

funding for the NHS as well, so he should keep that in mind when he

considers today's announcement and welcome the fact the Government not

only made more available at the spending review but an additional

?900 million announced today which, for example, just for the next year

alone in his local authority, will mean an additional ?3.1 million

minimum. Thank you. I think this is a rather sad statement because there

is too much party political point scoring on what is a very important

issue. I agree entirely with the excellent chairman of the select

committee and the former care Minister who speaks for the Liberal

Democrats. What we need here is genuine cross-party support. This is

not a party issue, server, and I would just urge the secretary of

state to explore the possibility whether there could be some

cross-party working on this. I think my honourable friend is right to say

the more we can all cooperate and put the party politics aside and

deal with this issue properly for the long-term, there's significant

long-term challenges in this sector, we will all be better off and our

constituents would thank us for it. Keitel the secretary of state that

the most crippling cuts are now being planned in the Walsall Burrell

and the allocation from central Government has been nearly halved in

recent years, doesn't the Secretary of State understand this is an area

I'm talking about, my area, where there is so much deprivation and

poverty and I want asking this question because the cuts next year

will be even more than previously! Why is there this Tory onslaught on

this borough? When is this war going to end? Firstly the honourable

gentleman will no that all councils across the country without exception

have been asked to find efficiencies and make savings, and many have done

that through innovative and clever ways through shared services, for

example, where they've maintained the level of services and at the

same time provide a lower cost to taxpayers. He mentioned his borough

of Walsall and notwithstanding just for Walsall and it is for many other

areas, they still must do things better and deliver them in a better

way where they can cut from six T- 17 by the end of this parliament

will see the changes we've announced today in terms of the adult social

care budgets that will also help is borough and changes to spending

power. I would like to thank the Secretary of State for the money but

I would also like to add my voice to those that are concerned about the

long-term sustainability of social care. As the Prime Minister said,

this is a short-term, medium-term and long-term. But he will know that

Rulli we have the issues of sparsity and over delivery, so pretty sure me

of two things: That he will not take is that of the gas in ensuring we

find these long-term solutions and secondly that he will work across

departments because it is also important that there is joined up

Government as well as joint up opinions on this.

First I can absolutely assure my honourable friend this will remain a

priority. Adult social care, not just for me, not just that the help

secretary who is here, but across government. This is an issue well

understood by government. That's why we've been able to listen and take

the action we've announced today. She's also right to say and to

highlight this is meeting a short-term need, particular cash

pressures which were rightly identified. We also need to think

about the and longer term. As the Prime Minister mentioned

yesterday Newcastle Council performed well on social care, but

this is put at risk if the Government doesn't act responsibly

to plug the ?15 million funding gap. This plan today relies upon local

areas being able to build new homes and raise local taxes, to solve a

funding and social care crisis. Can we not see this will entrench

inequality across the country and is playing politics with vulnerable

people's lives? The honourable lady... I know the

statement has just been made but I'm sure when she has the time to look

into a bit more closely, she will see it doesn't rely on building new

homes to get more adult social care. Nothing of the sort. Let me be

clear, perhaps it was unclear earlier and I'm glad she's raised

it, because if she thought that others might be thinking the same.

What I said, in terms of the 240 million, which is coming from the,

what would have been a new homes bonus budget, money that will no

longer be going into the new homes bonus budget and has been

transferred to adult social care budgets across the country, on the

basis of what's called a relative needs formula, and it will certainly

benefit Newcastle upon Tyne and other areas.

The Secretary of State is right to point out this is not wholly a

question of money. He mentioned Oxfordshire in his speech. Would he

accept in Oxfordshire the problems of delayed discharged care are being

sold by greater home bids and it's more of that imaginative approach we

need to see? My honourable friend is absolutely

right and I am glad he is highlighting this point again. It's

not just about money, of course resources play an important role and

today's announcement helps with that, but it's about a better way to

deliver these services. One of the key thing is required is more

integration between health and social care. I think Oxfordshire is

an excellent example of that. Since 2011-12 Nottingham City

Council, which he knows serves a population with very high levels of

deprivation, has seen its spending power reduced by 23%, while more

prosperous areas have seen their budgets rise. The preset will

further widen these inequalities. Nottingham recently won health

service award but there partnership... The portfolio holder

describes as being at breaking point. I listen carefully to his

answer to the right honourable member for Wellingborough but will

he confirm if he will take up the offer of a cross-party review, to

tackle the crisis in social care funding? Yes or no?

Mr Deputy Speaker, first of all, turning to Nottinghamshire... Where

the honourable lady is right is the highlight, area that can raise more

than even some neighbouring areas. That is why they're better care fund

already in place takes account of those tax-raising powers available

locally. Indeed, the other allocation beyond the 240 million

fund, that is going to be based on needs and that will also relatively

benefit Nottingham as well. She might be interested as well the

precept is worth 12.5 million to Nottingham next year alone. In terms

of talks, I think I've made it clear, I am happy to talk to

everyone, this is such an important issue.

The new homes bonus has become an important source of funding for

councils with a positive attitude to developments such as rugby Borough

Council. I welcome the additional incentive is the Secretary of State

has provided today, especially in respect of where there is an

up-to-date local plan. But can he reassure councils like Rugby they

will be continued to generate funds from the new homes bonus to provide

valuable infrastructure often needed to respond to local concerns about

development? I am more than happy to provide that

reassurance to my honourable friend, because he makes an important

connection between the new homes bonus and the need to make sure that

you have enough local services, especially infrastructure, to deal

with more people living in your area. The new homes bonus helps with

that. He might also be interested to note again the announcement of the

Chancellor in the Autumn Statement of the ?2.3 billion fund, the home

in structure -- infrastructure fund to help with those pressures and I

look forward to discussing that with him.

I think one of the cruellest things this government did was reneging on

their manifesto commitment to cap care costs, forcing more families to

continue to living the silent misery that is social care. Our Public

Accounts Committee report last year said it was disappointing. That

postponement, delivered over ?2 billion worth of savings. I've

listened very carefully today and we are talking about 900 million

commitment. I heard nothing about further implementation the care act

or close working with the Department of Health to solve this problem. It

would be helpful to understand what discussions have been had with the

Department of care. This is not just a short-term crisis or a medium-term

crisis but the long-term crisis, for which there is great willingness to

resolve. The evidence is clear over many years and I would add my voice

and urge the Government to consider this for the long term.

I think the honourable lady is referring to the reforms

recommended... I think she said they are not happening or they've been

cancelled. The honourable lady will know that what we've said on those,

that we are delaying them because we are listening, for example, to Local

Authorities, many have them have asked for a delay because it is

important. I know the honourable lady will agree with this, if you

carry out a longer term reform its very important to get it right. The

honourable lady also talked about the need for more integration, more

cooperation with the Department of Health and others. She may have

heard in my statement, again I refer to the fact my department and the

Department of Health were already working closely together, but as

this new flexibility is utilised by local councils we will also be

assisting on a new framework that shows us, convinces us local

councils are taking integration seriously.

I welcome the Secretary of State's statement today on all the work the

Government is doing to encourage the building of new homes. But when it

comes to considering changes to the new homes bonus, can I ask him to

carefully bear in mind, as I am sure he will, it's an important source of

income for smaller Local Authorities like mine in North Devon. And

secondly, the triggering of the new homes bonus is tied to the delivery

of new homes, which is not always totally in the gift of that Local

Authority, because of issues such as the availability of land at the

willingness of developers to build out. Will you work with me in North

Devon council to consider that carefully so we get the balance

right? That is an important point by my

honourable friend. First of all, I absolutely agree with him on the

importance of the New Homes Bonus. He will know it is a bonus, it is

something that the councils shouldn't rely on for day-to-day

spending, that's why we don't include it in our core spending

power calculations. But it is nevertheless important, not least

with the added pressure of those times. My honourable friend also

talked about how making sure there's incentives for working properly in

Dublin and I would be happy to discuss that with him further. -- in

Devon. Does he recognise additional precept

in an area with council tax base raises drastically less than in

areas more prosperous quest among the better care fund goes nowhere

near plugging that gap. So he is there for the dying tens of older

people of the home care and social care services they desperately need.

Mr Deputy Speaker, I'm afraid I have do disagree with the honourable

gentleman. The care fund goes a long way to plugging the gap. If I

reminding of the numbers. In the spending review it was 3.5 billion

of new spending by 2020, two billion of which would come from precept and

1.5 billion a year from the better care fund by 2020. It was designed

precisely to plug that gap. Hopefully he also recognises in

today's announcement it not all through precepts. The 240 million

fund is also to recognise that gap. Thank you Mr Deputy Speaker. Despite

council tax bills doubling under the last Labour government there was no

long-term solution to the problem of funding adult social care. Does my

right honourable friend agree with me that if we are ever to make real

progress we need a long-term solution, based on the conservative

principle of self-reliance and encourage people as far as possible

to provide for themselves? I agree absolutely with my

honourable friend. What he does for the House and kindly reminds us of

Labour's track record on this. He reminds us how taxes increased,

council taxes doubled under the last Labour government in 13 years. He

might also know in those 13 years they had a manifesto commitment to

deal with adult social care. They had a commission in 1999, two Green

papers in 0509 and 09 and comprehensive spending review, all

of this they said was going to solve the adult social care challenges and

all they did was make it much worse. I'd like to just firstly say the 1%

rise will raise just ?5,000 in Cleveland which is meaningless in

relation to the rising demand. There are two questions I would like to

ask the Secretary of State not clear from his rather rushed speech. The

first is about the new homes bonus and the key word being the savings

from the reform, not the New Homes Bonus itself. Just savings from the

reforms is not an awful lot of money, so I hope you can clarify

that point. Secondly, it is an Local Authorities themselves will be

keeping what they make of the New Homes Bonus or will it be

distributed nationwide from one part on a needs basis? If so he is

reinforcing the inequality because that New Homes Bonus is based on

council tax rates already, so he is reinforcing the inequality that

already exists in this country. What I can tell the honourable lady

is that for her local council redcurrant Cleveland, the precept

next year could raise 2.2 million. -- Redcar and Cleveland. The numbers

perhaps considerably higher than what she may think at the moment. In

terms of her questions regarding the New Homes Bonus. The New Homes Bonus

is being reformed, it is staying in place. The bonus which currently is

for the equivalent of six years of band D council tax will fall

gradually from five years to four years but the essential principles

remain the same. The savings that are generated from that change from

six to four, the 400 ?240 million pot will be distributed among those

authorities that provide social care services that will be done on needs

formula. East Northamptonshire Council are

firmly engaging with the Government's housing growth agenda.

Will he undertake to consult fully with them on any proposed changes to

the New Homes Bonus? It is essential that infrastructure and services

keep up with the pace of housing growth. I particularly say that

because the level of development is so significant in our area and it

has high costs associated with that. Again, my honourable friend

highlights the importance of new homes bonus to meet some of those

additional pressures, and that's why by having some of this reform we

make sure we've kept the principle that can help with those authorities

that are doing the right thing and building those times. My honourable

friend asked me specifically about consulting on the changes. I should

point out we started that conversation, it started in December

2015 and is now complete, however I think what he might be thinking

about is that I did say there was one other potential new change which

is about whether new homes bonus should be available if homes,

planning permission is granted an appeal.

Javid this morning the children in Birmingham wake up to a ?20 million

cut in the school funding. My son pulse at school already has 30

children in his class and he has SPN provision that will be taken away.

I'm here to tell him that the social care funding disparity that exists

across this country deserves exactly the same redistribution and in his

constituency of Bromsgrove, the older adult weekly rate in care

homes is ?100 less than in the Secretary of State's constituency in

Surrey. Does the Secretary of State stand in front of me and tell me

that it's OK that his constituents already get ?100 a week less than

those of his from bench colleagues who live in leafy areas? Mr Deputy

Speaker, first of all, the Honourable Lady in referring to her

local area Birmingham, rightly so. She mentioned my constituency of

Bromsgrove which is next door. I think she was trying to demonstrate

that Bromsgrove gets more per head on average. No, no. I'm comparing

Bromsgrove to Birmingham and it gets on average a lot less than

Birmingham per head and that is noticed locally. The Honourable Lady

, I get wider point was about the distribution of funding. Whether our

areas where less money can be raised locally because of the precepts of

the council tax base, that is why we have introduced the care fund. With

today's announcement it will help Birmingham significantly to the

precept, but Birmingham will benefit from the further ?240 million which

is allocated based on needs. May I welcome the announcement about the

fair funding review which might Honourable friend has been pushing

forward for a long time and may I welcome the additional funding that

is being provided to date, but can I add my voice to those who call for a

proper cross-party solution to this extremely important issue. Can I

also asked my right honourable friend whether he has discussed with

the member from Nuneaton and the issue in Staffordshire where the

problems with the better care fund are leading to substantial

reductions in, for instance, drug and alcohol services which

inevitably will place greater burdens on adult social care and the

NHS. My honourable friend highlights the importance of this the funding

review, being thorough and looking at all of the issues carefully and I

wholeheartedly agree with that. He also echoed the desire of the

Chamber today, which I welcome for parties to work together on adult

social care, given the importance to all about constituents. -- all of

our constituents. The situation in Staffordshire, the local minister is

looking at it and I am discussing it with him. I had a letter from one of

my constituents. He said that the councils can't collect money until

after winter, so what action will be taken to tackle the winter crisis?

First of all the changes we've announced today, although the

Honourable Lady is absolutely right that it is for the next tax year

which begins in April, it is something I know is usually welcomed

by many local authorities. It allows them to plan because those were the

two particular years where they felt they had the biggest gap because the

way the better fund was profiled, the full amount doesn't kick in

until the end of this Parliament. So it is something that planning can be

done and the certainty it will provide will allay some concerns. In

her constituency, forbid years 2017-18, a significant amount of

money will be raised that will make a difference. When considering the

financial settlement, but the secretary of State agree that

improving efficiency should be a priority? And how will he encourage

local authorities to move from a two tier structure to a unified one? His

general point about efficiencies is absolutely correct and that is why

today I have praise those local authorities that have shown they can

spend less money and in many cases improve public services. I've also

talked about the work that my department and the health Department

are doing together to work on the integration of adult social care and

to try to promote that more locally. He has asked me specifically about

the structure of local authorities and this is something government is

responsive to. We will listen to local authorities. A number of them

have come forward with plans and we will look at them closely. Today as

every day over 300 people will present at Addenbrooke's A that

serves Cambridge. That is 50% more than just a few years ago.

Shamefully at least 60 of them will not be seen within four hours. It's

almost one o'clock now so they will be seen until five o'clock this

afternoon. And that is because of the problem with delayed transfers

of care. That is a problem because Cambridge county council chose not

to use the precept this year. In county council election the next

year it is highly likely that will occur in lots of other places which

means the money won't be available in lots of places. Can I heard each

-- and I urge you not to pass the buck to local government but to

listen to members from across the house. He has expressed some warm

words, but can I pin him down and asking what is he going to do about

this? I think it is important, if the Honourable gentleman agrees with

me, if he believes in the power of localism, it is a job of local

government. Regarding the precept, the decision should be made at the

local level. Cambridgeshire and Peter Shah have reached a devolution

deal. By May next year they will have a directly elected mayor. I

think they are in a good position to look a devolution powers and see how

they can improve local services including adult social care. I think

there are the same number of people here as the world when I first

started bobbing. In my constituency town of Bexhill I was told we have

more over 85 than in any town in Western Europe. Many would have

moved to Aesop six and as a result council tax increases are a

challenge not just of them but for the rest of those in East Sussex.

Can I ask the Secretary of State that dealer-macro whether a National

Front will -- whether a national fund will alleviate the problem?

There needs to be the right balance between national funding and adult

social care and local funding through council tax. The increased

flexibility on the precept will help East Sussex, his local authority,

but also the change in the grant through the extra 240 million, that

will help East Sussex. He is right to say, and I think this is what he

has implied, this is welcome short-term news, but there was a

much longer-term issue and that is exactly something the government

will be concentrating on. We have two points of order. The art exactly

the same, more or less. Let's start with Christian. Mr Deputy Speaker,

you will be aware that there is a proposal to close half of the job

centres in Glasgow. Yesterday was day seven and the information at all

on the DW website refers to this matter. Today is day eight there is

no information on DWP website in relation to the public consultation

on the proposed closure of half the job centres in our city. That is a

great concern because we are now entering the Christmas and New Year

period where public consultation would be cut already. This

consultation is a moral as. It is showing contempt for not only

Honourable members of this house, but the general public at large.

Could a minister come before the house today to outline the processes

of public consultation on the intended job centre closures in

Glasgow? My understanding is that this was dealt with by a the Deputy

Speaker yesterday. I understand the importance of the matter and I think

you are aware there is a debate on Tuesday in Westminster Hall at

4:30pm, which would be the right avenue to pursue it. If I now come

to Stuart Malcolm. When this issue was raised by myself I think the

leader of the house inadvertently misled members when he claimed that

the dispatch box that the DWP was actively consulting on the issue.

This is forced. There is no consultation. I can't find the

consultation because it doesn't exist, so can you perhaps try and

find an opportunity sometime this afternoon for the deputy leader to

come back and correct the record from the dispatch box? It's not for

a matter for the job to correct the record, but if there was an

inaccuracy in the statement, you have put the point of view to say it

was not correct what was said. It is a matter for the leader of the house

and I'm sure if he feels it is wrong, it will be up to the leader

to correct that, but at least, if nothing else, this Chamber is aware

of it, I am aware of it, and as I said just before, there is a debate

next Tuesday, which I'm sure that this would have gone away and you

will be able to bring that point forward once again. Thank you Mr

Deputy Speaker. I need to bring to the house is a troubling matter. One

of the issues that has been corporate lobbying that has cast a

dark shadow over the political process. A brief was circulated on

the 13th of December by a representative of the large pub

companies who wish to be allowed for their members to convert pounds into

supermarkets without needing planning permission. They circulated

a briefing to some MPs that made a forced claim that was then repeated

by a minister at the dispatch box for a reason for not accepting

amendments. Something that Honourable members were influenced

by in the way they voted. The minister said on Tuesday, and I

quote, a briefing note from the British beer and Pub Association

makes the point that removing permitted development would not only

stop the conversion of pubs into supermarkets and whatever else they

will want to stop, but might prevent pubs from doing improvement works to

the premises which we would not want. I challenge the minister who

then said he is aware of what they are, but I tend to make the approach

that when I see briefings, I look at the points they make. If they make a

sensible point, they are worth looking at. The BB PA made a false

claim. It's troubling that... Order! They are meant to be short points.

Do you want to reply or shall we move on? Can I just say to members,

please, try and bring it briefly and quickly to the attention of the

house. If there is significantly something wrong in what the Minister

of State said for planning and London, I'm sure that the Honourable

member will want to put the record straight. You have brought it to the

attention of the house, it's on the record now and it is not a matter

for the chair, as you well know when you raise that point of order, but

we have allowed it to be done. It's on the record, it is up to the

Minister to reflect on what you have set. I'm not going to continue the

debate. I know -- I'm now going to move on.

Can I merely ask your advice, with this corruption of the legislative

process which was inadvertent on the part of the minister... What can he

advise that we do to make the British beer and Pub Association

apologise, to stop this kind of corruption of our legislative

process in the future? I can't do that, I'm the chair, I can't decide

if it was correct or incorrect. You put it on the record, it is

therefore all to see all to recognise and I know the Minister

well and if the minister was significantly wrong, I'm sure he

will want to put that right. I can't do more than that. I am not

responsible for the accuracies and inaccuracies, I can only help on how

we can move that one. I don't think you can do more than you have done

today. I don't think he will give up today either on this matter, that's

one thing I am assured on. Thank you, and I'm sorry I haven't

given you notice of the point of order but it occurred today during

questions. We had two very important departments, the culture, media and

sport Department and the international trade Department. We

tried to cram in in an hour two departments, the topical questions

only lasting for seven minutes. It clearly didn't work. I'm pleased the

leader of the houses in his place. There were many members that were

left disappointed on one able to scrutinise the Department date

coming to do. I don't know if this is something, Mr Deputy Speaker, you

control or some other organisation, but it would seem sensible if we

could go back to having an hour for culture, media and sport and an hour

for international trade. As you know it's not a matter for

us, but a matter for the normal channels to have a discussion. I'm

sure that can be reflected on with the Leader of the House, I know what

a great man he is a manner that will be looked into as a matter of and

duty. OK. The Leader of the House is now

present, I wonder if you would let him correct the record from my point

earlier. If the lady of the willing to say so I'm always willing, but if

not I've got a very... Sorry. It's up to the Leader of the House as

much as me. I've also got a very, very patient, and whose patience is

running thin at the moment, wants to make his presentation. He's going to

wear the carpet out, he's been going up and down the carpet waiting to

present his Bill. Mr Keith Vaz. Diabetes inpatient care Bill. Second

reading what day? 24th of February, 2017. 24th of February, 2017, thank

you. We now come to the backbench moment

on the creation of the financial dispute resolution platform.

Thank you, Mr Deputy Speaker. I rise to move the motion in my name and

that I other honourable members, and in time-honoured fashion can I thank

the backbench committee for allowing us to bring this motion to the main

chamber. I expect that many honourable friends and members will

wish to raise constituency matters and many of you have constituents

who have had mis-selling and loan dealings with the banks, and we are

trying today to move beyond those individual cases, serious as they

are, to trying to find some broad, permanent resolution system.

Can I also thank, while I'm here, the honourable member for Berkshire,

my predecessor as chair of the AP GG. The AP GG rules out of the whole

issue of interest rate hedging product mis-selling. We can lay this

that the Dorrans many different banks, Clydesdale, RBS, HBOS, HSBC

and so on. But what I really want to try and direct to the Minister today

is that after eight years of dealing with this problem, we need to look

to the future and some more permanent resolution, because what

is being affected is not just individuals, I suspect many

honourable members will have cases where, as I have, where the

individuals who were affected, it's not just their business. It's not

just that the money was lost, it is the fact of the impact on mental

health, which is very serious. I am very grateful to the honourable

member for giving way and thank him for raising this important issue.

Will he also agree along with all those people who suffered horrendous

loss of their business on their livelihoods, we also need to think

about whistle-blowers, who are often incredibly brave people who risk

everything to expose wrongdoing, they need to be properly treated as

well? I think the honourable member makes

a very fair point. In fact, often, from my experience, those who have

suffered most in terms of mental stress have been those very

whistle-blowers, who started off trying to present justice to the

community and the banking world and small businesses and ended up losing

jobs, losing family, losing partnerships and are still suffering

to this day. But the issue, let me say, is also an economic one. I will

say this to the Minister. We have eight years where though there has

been economic growth, levels of productivity have been poor if not

flat-lining. I think you could lay a lot of that at the underperformance

of the small business sector. It was not just individual businesses that

had been affected by mis-selling and lack of resolution, that has carried

on to a lack of investment in new businesses. It added to important

entrepreneurs withdrawing from businesses. Unless we find some

permanent resolution, we will not be able to create the economic growth

that I know all of us in this house would like to see. I will give way

first my friend here. I thank my honourable friend for

giving way. He's right that a number of us have constituency cases. He

will be aware of my constituent Neil Mitchell whose business was forced

into administration and finds himself almost trying to take

private legal action. Does he share my disappointment at the lack of

willingness for RBS to enter mediation and hope that these

motions can be taken forward from his proposal?

I take my honourable friend's point. We have so many of these individual

cases, and it goes beyond, it cuts across all the nations of the United

Kingdom. All members and all parties have these cases unknowingly

desperately to find some permanent resolution.

I thank my honourable friend for giving way. My honourable friend

made a very good point about small business and encouraging small

business. It's very important we get a fair deal for small business. He

will be aware of the case in my constituent, who was looking to

refinance at a preferential rate but was faced with high exit fees and

termination clauses that had not been made clear in the terms and

conditions. That's something that is crucial for small business and my

constituent. Indeed. I think that comes to the

nub of the issue, the imbalance in power between an individual small

business and the bank. I thank my honourable friend for

giving way it, I also have a constituent in a similar situation.

He rightly talks about the imbalance, because his business was

put under by the Royal Bank of Scotland, but he found time to take

-- trying to take legal action was almost impossible because the Royal

Bank of Scotland, is bailed out by the taxpayer, within a stronger

financial position than he was to do that. An alternative mechanism at

least gives a real chance to these businesses are taking on these

massive banks which the public have bailed out.

Indeed. What is clear in Scotland on that point, and it may be true for

other parts of the United Kingdom, is the major banks have indeed

signed up many solicitors practices, which makes it almost impossible to

find a lawyer to represent you, even if you wanted to take action against

a bang, difficult though that would be given their financial ability.

I am very grateful, he's being extremely reasonable and allowing

interventions. Would he agree the absence of a clear dispute

resolution process actually incentivises bad behaviour and

practice, if the banks know there is no proper mechanism to challenge

wrongdoing, then it's thing courage in that bad behaviour?

Usually up to 15 minutes to speak, I have a bit of flexibility, but just

to warn members I'm going to make sure of one has a fair shout.

I thank you. For that reason, having been reasonably accommodating I will

try to press on and get to the nub of my argument. I think in terms of

permanent resolution of the problem we need three different mechanisms.

We need some kind of shift in the legal onus on banks to provide a

duty of care or good faith in the way they deal particularly with

business customers. I know that is a broad debate, and I know over the

years the banks have been unwilling to accept a narrow duty of care.

It's open for debate but I do think that we need to redress the balance

between major banks and small business clients, by providing some

kind of mechanism within the legal onus on how banks behave. I would

even accept initially of the banks were prepared to come forward

themselves with some solution on this. But I think when it look that.

Secondly, given that many banks, given many small companies end up in

insolvency, we need to look at a more balanced insolvency practice,

in order to remove the possibility banks all lenders are tempted to

force them into unnecessary or premature insolvency. And we knew

and permanent redress system for banks and small businesses that are

in dispute. In effect, putting those three together we are changing bank

culture. In order to build some common ground with the Minister, I

hope, I think the Government has already moved some way in

recognising this issue. If you look at the impact assessment statement

the Government provided for proposing the establishment of a

small business Commissioner, let me quote from the impact statement from

the Government. It says "the Government is concerned that this

small firms negotiating a contract with the larger business can be

challenging. The Government has been told that small businesses often

feel intimidated and rather than walking away from a proposed

contract or refusing to agree a change. There is concern larger

firms, for that Reid Banks, sometimes use their market power to

impose on favourable terms. " That I think the whole issue of the hedging

products, sold to small businesses during the economic boom in 2006 -

08. The Government has recognised the general problem. It's a matter

of how we resolve it. I quote again, just to show I think there is a

broader political agreement on this, right and left. Can I quote from

that a member of the Government benches, the member for Camborne

Redruth who wrote a piece for the free enterprise group three years

ago. Let me quote. His pieces defending the rights of those who

take risks. He says "Over the years the banks have contracted very

extended their rights through their standard terms and conditions to

give LPA receivers general powers of sale, to set aside the limit on the

fees they charge and cut costs on the borrower. They've moved to grant

themselves the right to peacefully re-enter properties of which they

can take charge. They contract very extend the power taken by the banks

which goes well beyond what was reasonably envisaged in the property

act 1985." In other words the banks have gradually extended their powers

of receivership and that has made it increasingly difficult for small

companies in financial difficulties to get re-dress. I think that's led

to the whole issue behind the RBS GRG that's come back into the domain

with the report from the FCA. The Minister I think will tell us that

ultimately if there is to be a change in the re-dress process, it

has to come from the Financial Conduct Authority. To that end, the

APPG has been consulting with them and I raised the matter with Mr

Andrew Bailey, the new chief executive of the FCA when he

appeared before the Treasury Select Committee. I asked him to draw any

relevant conclusions from the experienced the FCA has had with the

banks in drawing up ad hoc processes of re-dress for the various

mis-selling schemes that have taken place. I asked general conclusions

he drew. He said the problem goes back to the beginning, which is

where there is an outside, where the banks are outside the regulatory

perimeter, as much of this mis-selling was conducted. These

schemes outside the regulatory perimeter... We've learned from the

experience, coming late to it, that businesses feel they have not had

their say in court. Now they do not want to have a little day in court

because it's very expensive. But what I conclude from this is that

it's not satisfactory from the point of view of the FCA, the ad hoc

procedures we've heard today, not satisfactory because the FCA has

been involved in creating a lot of these bespoke processes. We have

discussed this on the board of the FCA a number of times. Were there to

be a mechanism that could substitute for these ad hoc procedures, rather

like the ombudsman, but for more complex cases, because corporate

cases are often more complex, this would be a big step forward. From

the point of view of these things, we are creating a lot of work for

ourselves, the FCA, however I am very sympathetic to Mr Bailey to the

people involved. So we have to do it. If there were to be a process

that could substitute for the ad hoc processes... They would be happy to

look at that. Were there to be a mechanism that

could substitute rather than like the ombudsman for more complex

cases, that is what they would support. We are bringing forward the

idea of a tribunal. At this stage it is a generic proposal. There are

issues to be discussed. It also crosses the boundaries of the

devolved administrations. If we went down this road, they might have to

be different procedures in Scotland. The aisle financial issues. My own

view is that since we are dealing with ree dress with the SCA has

designated win in the bank has been involved in the selling, we are

already in the territory where a bank is going to pay and any

permanent tribunal system will be funded by the bank in that

circumstance. We are open into a general discussion with government

on how to proceed with this, but the backing in general terms with the

SCA is there, so it's a matter of the detail. Why is this important?

Because the issue has not gone away. We are now in a situation where the

Giorgi situation from RBS is going to come back in the public domain.

The Royal Bank of Scotland subsequently has now put forward a

new ad hoc siege for dealing with those who are submitting complaints.

Those small businesses who were put into GR G. We have a report, not yet

finalised by the SCA where they have taken technical advice. The SCA has

found there was a conflict of interest involved in how RBS handled

the cases of companies put into GRG, in that that part of the bank that

was taking over the property from solvent companies and the selling

was part of the GRG group. The bank, in effect, was putting companies

into southern sea, taking the property, handing it over to another

part of the bank and generating cash there. Given this issue has

reappeared and there is a public debate over the nature of the

redress system, then we are not looking at legacy items now, we're

looking at a future situation with the Bank of Scotland, the Royal Bank

of Scotland is creating an ad hoc redress system which we need to

ensure is the correct one. The bottom line for the minister is

there is now an ongoing process of debate. There was a general

consensus we need a permanent resolution system. You can go beyond

that and look at insolvency law. It's the government to join with us

to make sure that resolution process is provided. We will have up to

eight, if there's more, will have to impose limit. I'd like to speak as

the chairman of the alternative dispute resolution. We are about to

embark with his British Beer and Pub -- with his APPG. The bit of his

motion that I wish to concentrate on is the bit that refers to the

creation not of ad hoc compensation schemes, but a long-term effective

and timely dispute resolution mechanism that can be used to help

solve these sorts of issues. The reason for doing that, I think he

has set out very admirably, but I think what I will say to him is that

actually, that dispute mechanism is actually already the and it is there

in the form of the alternative dispute resolution regime. Come on

to say something about that in just a second. Businesses including S M

es are left with no option except prohibitively expensive appearances

in court and one of the great advantages that the alternative

dispute resolution system brings is the potential to reduce the costs

that are involved in doing this. Now, this is not something that is

strange to the financial services sector. There are a whole number of

commercial sectors that automatically include alternative

dispute resolution clause is within the commercial contracts and we

indeed APPG held a meeting on this quite recently where we looked at

how ADR could be incorporated within the system, how it could be used

more often. We looked at the commercial area in quite substantial

detail. One of the great things we were able to do with the APPG was to

bring together what is quite disparate body of people who operate

in the ADR feel to see if there were any common threads between them in

approaching disputes like the one has mentioned in taking it forward.

The good news that there was quite a lot of agreement about what we were

aiming for, even though some of the methods of getting there was

slightly different. For us, ADR includes arbitration, mediation,

adjudication, expert determination, dispute boards and online dispute

resolution. We also looked at the examples of how they could be

incorporated in how they work being incorporated by financial services

sectors in their contracts. The good news from his point of view is that

they were being incorporated already into the contracts on what we needed

to do was put pressure on them to include them as a matter of course

in the contracts because it helps to solve these disputes. Of course.

Could he clarify which sectors of the financial services sector work

incorporated? Was it retail business to business that were incorporating

ADR? I haven't seen many commercial contracts with ADR clauses from the

banks. From memory, it was business to business that primarily included

that, but there is no reason it can't include the business to retail

sector as well because it holds open a great deal of ability for

individuals to bring cases that are quite complex, but in a way that

doesn't involve going to be courts, which I will explain in just a

second. In fact, let me move on to that as we are running out of time

for this. We all know that trying to bring a case to the court is a very

expensive business. It requires extremely expensive lawyers and what

the arbitration process or the mediation process holds out is the

ability for an individual to sit in arbitration and mediation in order

to bring the dispute to a much early resolution. Now you can say that

this doesn't take away the need for the involvement of the court and

that is absolutely true. The awards of the arbitration panel or of the

mediator do have to be enforced by the courts and the courts do have

that role there, but that is a long stop for the ADR process and it is

one I think we will see more infrequently being brought into

play. Lord Justice Briggs has commented that he would prefer to

seek alternative dispute resolution is not called alternative dispute

resolutions, that the alternative is taken out of them and it's just

called dispute resolutions, which I think fits well with our own view of

things. The other side of this is the issue of time and stress

involved in taking forward cases within this sort of framework. It is

absolutely true that the arbitration and mediation process does take away

a lot of the stress of appearing in court and does allow for these sorts

of issues to be settled in a much more friendly way. So I look forward

to the work that our two APPG groups will be doing. I think the framework

is already there. I think we need to encourage banks to include clauses

within the commercial contracts in order that we can get back to ADR is

becoming the standard mechanism for resolving disputes rather than just

using the internal complaints procedures of the companies as the

starting point and ending point of much of the discussion that taking

place, and on that note I'm very happy to pass on to somebody else.

Thank you, Mr Deputy Speaker. It is a follow-up to -- it is a pleasure

to follow the honourable member. Can I welcome the motion tabled in the

name of the Honourable member for East Lothian to which I've been

pleased to add my name as a Labour member of Parliament to support the

objective on a cross-party basis. The issue is one of great importance

and the Minister has, I hope, a duty to this house to respond in a

positive way to the very straightforward demands that are

being made by the members today. Those very straightforward demands

are that we establish a mechanism which is universal, which allows

businesses and other people in non-regulated sectors to have an

appeals mechanism for an independent review of the situation. That's an

important motion and one which I support today. The demands are clear

and the demands have not just come out of the blue, Mr the city

Speaker. The motion itself refers clearly to the statements of Andrew

Bailey of the FCA and the Treasury committee on the 20th of July 2016

where his statement was that we needed to look at the fact that the

ad hoc creation of compensation schemes within the SCA had not

worked. That there was not a mechanism in place for many of the

businesses that no doubt members will speak about today to find

resolution. -- SPCA. These are businesses which are small

businesses facing big banks that have time, money and expertise and

have very often the patience to try to seek out the complaints that are

being made. So I think that the motion today calling for an

effective sustainable platform for commercial financial disputes is

absolutely right and of its time. Although many financial firms may be

regulated, businesses in commercial business is an and regulated

business. Businesses do not have the same rights as consumers do. They

have to rely on the ombudsman services which may not be equipped

to deal with these problems. Businesses have to look at the

potential of long protracted activity through the courts. All of

this mitigates against what is effectively fairness when

opportunities have been denied or when ROMs have been given. If we

look particularly, Mr Deputy Speaker, in the time that we have at

the areas I'm concerned about which is relating to the Royal Bank of

Scotland, then we will remember before the minister response to it,

this remains a bank in public ownership. It remains us as tax

payers endorsing and acting on behalf of the bank. The Minister has

a look at not just the complaints procedure that is being proposed by

the member of East Lothian on behalf of the banking group, but also on

behalf of the government and taxpayer for the services provided

now and attitudes in response is taken by a bank that remains owned

by me and every member of this house. Why does this matter? If we

look at the fact that 12,000 companies have been pushed into the

turnaround position which is called global restructuring, whether real

pressures affecting businesses where the bank has acted unfairly and has

recognised it has acted unfairly by providing a compensation scheme of

its own, with no independent scrutiny of the scheme. No

independent endorsement yet because as my honourable friend has said it

has not yet been finalised. The Royal Bank of Scotland has a

major commitment to those 12,000 businesses. Why does it matter?

Because I want a detailed the case of my own constituent, Clive may of

moulded North Wales. He has experienced at first hand the

actions of the Royal Bank of Scotland, in relation to a

government-sponsored scheme, the enterprise Finance guarantee scheme.

He was the owner of a successful business, employing 100 people in

North Wales at a construction company building houses, buildings

and factories. He was approached by RBS and asked to take on board the

enterprise Finance guarantee scheme, designed by the then Labour

government to support the growth of businesses, not the closing down of

businesses, through the difficult times of the recession in the early

sorry, late part of 2008, 2009, period. The schema for Mr Mayweather

is designed to support the expansion of his business. He believed. He was

informed his overdraft, which he had always met, was not access was to be

taken over by the Finance guarantee scheme and his business would now

protect and develop his cash flow. That was a false owed by the Royal

Bank of Scotland, because the moment he took the enterprise Finance

guarantee scheme, the Royal Bank of Scotland placed the company into the

distressed apartment at RBS and cut his overdraft immediately...

I'm very grateful to the honourable member for giving way and it has

been a pleasure to work on this with him, what I regard to be a scandal.

What he's saying is an incredibly serious allegation. Not only as an

individual destroyed but there is misuse of public in doing so.

Absolutely. And I make that allegation here today for RBS. I

think they have acted appallingly, Madam Deputy Speaker, regarding the

treatment of my constituent. They were in the process of taking on new

contracts, excellent cash flow and in over the overdraft limit. The

moment Finance guarantee scheme was issued, the RBS took from the

Government and money underpinnings that over draft, closed it down and

ruined his business. The question of why that is important, in the short

time I've got, is because Mr May exemplifies the little business, the

small business that faces the big banks. He and his wife have spent

two years, three years, four years arguing this case, with me as a

member of Parliament, having meetings with RBS, looking at court

cases, looking now at criminal activity, which has been reported to

North Wales Police, because that are allegations of fraud, and which is

being looked at by the CPS is currently reviewing the case, on

behalf of concerns about how that bank has acted. There is no

mechanism apart from his personal self determination and will to drag

this case forward, and to hold RBS to account, for him to undertake

that holding of RBS to account because the FSA cannot do that. He

has to have that will himself, with the support of his family, and I

hope his member of Parliament. That is not acceptable. That's why I

support the honourable gentleman from East Lothian and that's why I

think Mr May and businesses like him need that mechanism to make sure

they get fairness when they face banks such as RBS, that treat those

businesses with disdain. Madam Deputy Speaker on very glad to

rise in this debate to support the motion and congratulate the

honourable gentleman with whom I serve on the Treasury committee the

East Lothian. It's not just in securing this debate but the

excellent work is done in bringing forward the APPG. I'm grateful for

the invitation. I'm want to make three points. The first about

incentives, the second about the cost and accessibility of courts and

the third about complexity. On the centres for bad behaviour,

it's a matter I've touched on previously in the House,

particularly in relation to liability. It is particularly

appropriate that the House today is so well packed with members of the

Scottish National party, because I know at least one member opposite

will be glad if I say I recently attended the Adam Smith Institute,

where I helped launch a book by Tyler Brett Goode speed, an American

economist working in the UK, who wrote the book legislating and

stability of 1772, which may seem irrelevant but it goes very much to

the heart of what is wrong today, because what that book shows is that

the Scottish banking system, as it was characterised by unlimited

strict liability among the partners, had a very good, strong incentives

for the owners of banks and staff of banks to behave well. I'm grateful

to honourable members who are nodding in agreement. We have, very

long way since of course, and not about to go back to free banking,

but I would use a quote from an actor who I don't wish to name on

this occasion. He's talked about his work and what he found. He said to

me, I've examined around 100 individual cases, all of which had

the same negative qualities. It's a case of bank salesmen deliberately

withholding key information about withholding key information about

the risks embedded in the hedging products they sell. The term hedging

itself is misleading. Overall, the process is disgusting. Bank sold

derivative products on top of loans to their clients, which those banks

knew would render them less credit worthy at the point of sale, and

therefore rendered the business more likely to fail. How this could be

described as hedging by any financial organisation with a scrap

of integrity is beyond me, he said, and I'm inclined to agree. He went

on, this misleading use of language unfortunately, maintained by some of

the experts who charge large fees to take the case to court, they miss

out on key risks, the cases become far weaker, possibly to the point

the case fails. At best the bargaining power of victims is a

much reduced. It's that experience I want to pick up on. Because the

second point is about the cost and accessibility of the court system,

which I think points to why this debate is so important. We've both

heard evidence, not only in our own constituencies, but from the

authorities which have shown that the system that was set up was not

adequate to the task at hand, and I'm sure many members of this house

will have constituents whose businesses have been in great

difficulty and whose lives have been affected, and found that system

failed them. So however well-intentioned the authorities

were in setting up the system, it has not worked well. We need to find

some middle ground between the courts which are too expensive and

complex, and which require expert evidence, which is often not

available or too expensive to purchase equality, and the

semiformal system which we found to have failed. I just would observe

that looking at the courts and therein adequate seas and the

necessity of avoiding them, it's an old problem. I think the Government

will have quite some task ahead of it if they are going to deal with

it. The final point is this issue of complexity. I'm sure even those of