| Previous Section | Index | Home Page |
Stow-on-the-Wold Magistrates Court
31. Mr. Geoffrey Clifton-Brown (Cotswold): What representations he has received regarding an appeal against closure of the magistrates court in Stow-on-the-Wold, Gloucestershire. [70851]
The Minister of State, Lord Chancellor's Department (Mr. Geoffrey Hoon): I have now received three representations from local interested parties following Gloucestershire magistrates courts committee's decision to close the Stow-on-the-Wold magistrates court with effect from 1 July 1999.
Mr. Clifton-Brown: The Minister will be aware that the magistrates courts in Tewkesbury and in Chipping Campden have already been closed. That means that huge swathes of north and east Gloucestershire will be without a magistrates court, which will involve my constituents having to travel distances of well over 20 miles, even though the bus service is virtually non-existent. Is not that the quickest way to alienate constituents in rural areas from the summary justice system?
Will the Minister consider an appeal from Gloucestershire county council against that ludicrous decision by the Gloucestershire magistrates courts committee, which will save only £7,000 a year? The decision is utterly ridiculous--so will he overrule it?
Mr. Hoon:
Each of the decisions to which the hon. Gentleman refers was taken locally--they were certainly taken by the local magistrates courts committee--and, I suspect, involved his own constituents. In respect of the particular appeal concerning the Stow-on-the-Wold magistrates court, as he will know, the appeal process has only just begun. Those involved in each part of the appeal will be given an opportunity to present their case and comment on the case made by the other side. A decision will not be made until both parties have confirmed that their cases are complete.
32. Mr. John Bercow (Buckingham):
If he will make a statement on the legal aid budget for 1999-2000. [70853]
The Minister of State, Lord Chancellor's Department (Mr. Geoffrey Hoon):
Legal aid provision for 1999-2000 is £1.63 billion. Of that, the Government expect to spend approximately £850 million on criminal cases and £780 million on civil and family legal aid.
Mr. Bercow:
I am grateful to the Minister for that reply. Given that the number of firms providing legal aid services is set to fall, as a direct result of Government policy, from 10,600 to only 3,000, why does he not understand that firms with block contracts to act in either the civil or the criminal courts are anxious for some reassurance about what will happen after the first round of contracts has been concluded under his Access to Justice Bill?
Will the Minister accept that, unless some such reassurance is forthcoming, people will inevitably conclude that the Government are hellbent on cutting costs, whatever the sacrifice in the quality of service or in access to justice?
Mr. Hoon:
I want to make it clear to the House that no decision has yet been taken on precisely how many
Charlotte Atkins (Staffordshire, Moorlands):
Is it not the case that some lawyers are getting rich at the expense of the legal aid budget, while profit-free services such as citizens advice bureaux and law centres suffer?
Mr. Hoon:
Certainly, that is part of the underlying reason why the Government intend to create a community legal service, as I said in answer to my hon. Friend the Member for Redditch (Jacqui Smith) earlier. The community legal service will be able to concentrate help where it is most needed, especially among the most disadvantaged in our society.
33. Mr. Nick St. Aubyn (Guildford):
If he will make a statement on the effects of his Department's plans to withdraw legal aid in personal injury cases. [70854]
The Minister of State, Lord Chancellor's Department (Mr. Geoffrey Hoon):
The Government are determined to ensure that the best use is made of taxpayers' money used to fund legal services. We see no reason to use taxpayers' money where other suitable forms of funding exist. The vast majority of personal injury cases are suitable for funding through a conditional fee agreement and at least 50,000 such agreements have already been made. However, cases with exceptionally high investigative or overall costs, or that raise issues of public interest, may continue to receive help from public funds. Moreover, there are no present plans to remove from that scope cases of personal injury caused by clinical negligence.
Mr. St. Aubyn:
Does that answer not demonstrate mean-mindedness, because the costs of claims are often recovered through successful prosecutions and are therefore extremely small? Does it not also show shortsightedness, because in personal injury cases, where individuals' life chances have been destroyed, those without the money to pursue their case will no longer be supported by the state and, as a result, will become a burden on the state, costing the Exchequer many more pounds in the future?
Mr. Hoon:
Unfortunately, the statistical evidence does not bear the hon. Gentleman out. If the House will forgive
Ms Beverley Hughes (Stretford and Urmston):
Does my hon. Friend agree that lawyers in personal injury practice constantly come across people who cannot afford to pursue personal injury cases precisely because they are not eligible for legal aid? Would not moving to a conditional fee arrangement open up the courts to those with genuine claims who cannot pursue them now because they are of modest means but just above the limit for legal aid?
Mr. Hoon:
My hon. Friend is right. At present, many people cannot afford to fund legal cases themselves, but are not so poor that they qualify for legal aid. The success of the arrangement demonstrates that the large number of people in the middle can gain access to justice as a result of the conditional fee agreements.
34. Mr. Desmond Swayne (New Forest, West):
If he will make a statement on his policy on the closure of rural magistrates courts. [70855]
The Minister of State, Lord Chancellor's Department (Mr. Geoffrey Hoon):
The Government's policy is that the administration of magistrates courts is best decided locally, consistent with the provisions of the Justices of the Peace Act 1997--legislation that we inherited from the previous Government. A local authority that contributes financially may appeal to the Lord Chancellor against a proposed closure. The procedure for such appeals is also set out in section 56 of the 1997 Act. In the absence of an appeal, the Lord Chancellor plays no part in the process.
Mr. Swayne:
Magistrates courts are not volunteering for closure: these closures are a consequence of the Minister's policy. How many rural magistrates courts have closed since the hon. Gentleman took up his responsibilities?
Mr. Hoon:
The hon. Gentleman is right so suggest that magistrates courts are not volunteering for closure. The local magistrates courts committees, which are responsible for them, are taking those decisions.
3.30 pm
The Prime Minister (Mr. Tony Blair): With your permission, Madam Speaker, I should like to make a statement.
On 27 October 1997, my right hon. Friend the Chancellor of the Exchequer set out the Government's policy on the European single currency. He said that he would publish details of how, should it choose to do so, Britain could join the euro. That became known as the national changeover plan. Today, we publish an outline of that plan as a basis for consultation.
I should like to thank the standing committee set up by the Chancellor to oversee preparatory work on monetary union across the economy. I am most grateful to the Governor of the Bank of England, the heads of the Financial Services Authority and the British Bankers Association, the presidents of the Confederation of British Industry and the British Chambers of Commerce and the general secretary of the Trades Union Congress for their contribution to this work. It has been a truly co-operative effort involving an unprecedented partnership between the public and private sectors. I am particularly pleased that the standing committee welcomed our intention to produce the outline plan that we are publishing today.
In his statement of October 1997, the Chancellor made clear the Government's view that membership of a successful euro would bring benefits to Britain in terms of jobs, investment and trade. He said that, in principle, the Government were in favour of Britain joining a successful single currency, and he set out the conditions necessary to satisfy our national economic interest.
Our intention is clear: Britain should join a successful single currency, provided the economic conditions are met. Our membership is conditional; it is not inevitable. Both intention and conditions are genuine. We believe that it is the right course for the country to resolve this issue for the British national interest, the future of our people and their well-being. It is that national interest that will always come first.
I do not dismiss the constitutional or political issues. They are real. Monetary union is a big step of integration, but so were the Single European Act and the European Union itself. In finance and business, the world is more and more integrated. It is moving closer together. If joining a single currency is good for British jobs and British industry, and if it enhances British power and British influence, I believe it is right for Britain to overcome those constitutional and political arguments and the fears behind them. For the very reason of the sensitivity of those arguments, we have also said clearly that the Government can recommend, but the people will decide in a referendum.
What we announce today is not a change of policy: it is a change of gear. If we wish to have the option of joining, we must prepare. The sheer nature, scale and complexity of the arrangements require considerable time for such preparation. Joining the euro is, for example, far more detailed in its consequences than decimalisation. If we do not start to face this reality now, we will simply not have the practical means necessary to make a choice.
There are those, on the Opposition Benches and elsewhere, who oppose the very idea of a national changeover plan. We can no longer afford to pretend
either that the euro does not exist or that Britain should not actively prepare for it. Such a denial of reality does not promote Britain's interests; it betrays Britain's interests.
The euro is a reality. It exists. Eleven out of 15 other European Union members are in it. It represents 20 per cent. of world income--as big as the United States. It will be the currency of 290 million people.
The euro has begun and, on the whole, it has begun well. Of course, these are early days. There will be tests and strains ahead, but the launch was successful. Those who predicted that it would never happen or would launch itself in disaster have been proven wrong. And it will have a major impact on Britain, in or out: that much is obvious. That alone would rebuke those who would like to pretend that it is not there.
Fifty per cent. of our trade is with the euro zone. The launch of the euro means that an increasing number of UK firms are already starting to use the euro--and not just big business such as British Steel, Ford, Philips, ICI and Unilever; surveys by the Treasury's euro preparations unit show that some 45 per cent. of small and medium-sized enterprises in the UK have trading links with Europe, and they are already having to prepare to deal with the euro. The same surveys showed that nearly half all SMEs thought that the single currency would affect their business. Last autumn, some 14 per cent. of SMEs were already planning to use the euro, and the latest survey by APACS--the Association for Payment Clearing Services--shows that 247,000 companies intend to open euro accounts. Eighty-six per cent. of large retailers have suppliers in the euro zone, and 44 per cent. say that they are planning to pay euro zone suppliers in euros from this year. The euro, therefore, is now an everyday reality for British business, large and small.
When we came to office, we took immediate steps to help the country to prepare. Since the Chancellor's statement, the Treasury has run a major information and direct mail campaign for the 1.6 million small businesses in the UK. Some 350,000 copies of the Treasury's business fact sheets have been distributed, and there have been 750,000 requests for the fact sheet leaflet. We have established 12 regional euro forums across the UK, led by senior business people, who are making preparations at local level.
Firms can now pay taxes, file accounts, issue and redenominate shares, and receive certain grants in euros, and Customs and Excise has trained some 10,000 staff to respond to business needs. Small businesses will have the help that they need. The City of London is prepared, and is already taking a good share of euro-denominated business.
These, however, are all preparations for the euro with Britain, at present, out of that single currency. It is also necessary now to prepare for Britain being part of it. If, as we have already announced, we want to keep open the option of making a decision early in the next Parliament to join, we need to step up our practical preparations now; hence the national changeover plan.
The public sector will give a clear sign of its commitment to prepare. Each Department now has a Minister responsible for euro preparations, and each will now report regularly on the preparations that are being made. Where computer systems are being upgraded, all Departments will build in euro compatibility where that
represents value for money. In the case of the Department of Social Security, the Inland Revenue and Customs and Excise, the scale and complexity of their computer systems make advance preparations critical. Together, those Departments are the main interface between central Government and the business community, and deal with almost every individual in the UK. They may need to spend some money prior to a referendum to make their information technology systems euro compatible, so that we can maintain the flexibility for Britain to make the changeover as quickly and cost-effectively as possible.
It is right that Parliament should be asked to give explicit approval to such expenditures, which will amount to some tens of millions of pounds spread over a number of years. We will therefore include provisions in the Finance Bill and the Social Security Bill that will authorise the spending--and, of course, there will be the normal votes on the appropriation accounts. The Government will be making active preparations for the euro, in the belief that it will be in this country's interests to join in the future should our economic tests be met. Business should start to do the same.
The national changeover plan sets out the range of work involved for different sectors. For example, in the retail financial sector, the British Bankers Association and APACS are leading work with the Bank of England on how to approach the conversion of their core IT systems. The retail sector more generally will be working, with consumers and suppliers, on a detailed code of practice on arrangements for the changeover. Businesses, large and small, need to focus on the impact of the euro on their business strategies.
On the basis of that work, and after studying the experience of the first wave of participants, the outline plan that we are publishing today shows that it is possible to streamline the timetable adopted in Europe, with no disadvantage to our economy and some benefit. Overall, we believe that it should be possible to move in four months, from a Government decision to a referendum; and, in 24 to 30 months, from a positive referendum result to the introduction of notes and coins. It would be a further six months before sterling notes and coins were withdrawn.
Therefore, the whole process--from a positive referendum result to the withdrawal of sterling--could be completed in about three years, which is considerably faster than the period required for the first wave of monetary union participants. However, a great deal of further work must be done to refine and develop the timetable, and particularly to clarify how soon after a positive referendum result we could actually join monetary union. As the plan makes it clear, we are committed to taking that work forward in collaboration with business and the wider public sector, so that we can produce a further plan in about a year's time.
As for the economic tests that the Chancellor established on 27 October 1997, there is much focus--which is entirely natural--on the politics of the euro project. It is, of course, an intensely political act. However, just as the euro cannot be conceived of except politically, it cannot be made to work except economically. It is, after all, an economic union.
We have, as a Government, resolved the political issues in favour of the principle of joining, should the economic tests be met. But they must be met. The manner in which
we joined the exchange rate mechanism is a standing monument to the danger of joining a monetary arrangement on purely political grounds.
There are, therefore, two ideological and absolute positions on the euro which I do not share. The first is that of "no, never", which rules out Britain's membership of the euro for always on the ground of constitutional principle. The position is perfectly principled and argues--no matter what the benefits in jobs, industry or even influence--that such a decision is simply wrong, on the ground of sovereignty.
I cannot accept that position, for the reasons that I gave earlier. In the modern world, one has only to lookaround to see that technology, global finance, mass communication--to say nothing of travel and culture--are coming together. The world is moving together. Sovereignty pooled can be sovereignty--or at least power and influence--renewed. I suspect that, even if we were today to rule out membership in principle and for ever, in a few years, that ruling would itself come under question. In the meantime, we would have lost all influence whatsoever in the economic future of the European Union, of which we will remain a member.
The second position is an unconditional "yes, now". It maintains that economic conditions are meaningless, and that we should join regardless. I believe that economic conditions are meaningful. It is precisely because the conditions are meaningful that we have said, to give some greater certainty to business and the country, that, barring unforeseen circumstances, we would not make a decision in this Parliament to recommend joining the euro.
It is worth, however, summarising the economic tests that the Chancellor established: sustainable convergence between the UK and countries within the euro zone; flexibility to adapt to change in the UK and in continental Europe; the impact on investment and the UK financial services industry; and whether joining the single currency would be good for employment.
Three points should be emphasised. The first is that economic convergence must not be momentary, but, as far as we can accurately foresee, sustainable. We are still at a different stage of the economic cycle from the rest of Europe. However, the difference between our official interest rates and theirs is narrowing. In October 1997, UK interest rates were at 7 per cent, with those in France and Germany at close to 3 per cent. UK interest rates are now at 5.5 per cent, compared with 3 per cent. for the euro area. The difference between our long-term interest rates and their own also is narrowing, and is now down to about 0.5 per cent. Long-term, UK interest rates are now about their lowest for 40 years. Our inflation performance also is consistent with the European central bank's definition of price stability. However, it is essential that convergence is settled and sustainable. We cannot say that yet.
Moreover, for decades we have been prone to far greater swings in the economic cycle than our continental counterparts. It has been boom and bust. That has enormously damaged investment and reduced our ability to grow without hitting an inflationary ceiling at relatively low levels of growth.
Under this Government, there is an entirely new framework for economic management in place. Bank of England independence has at long last given us credibility in interest rate decisions, as well as low interest rates.
There are also new fiscal rules which the Chancellor has relied on to slash the £28 billion borrowing requirement and ballooning national debt which we inherited and put us on a path of fiscal prudence. The new framework is a revolution in economic management for Britain. On its foundation, we have put in place measures to boost education, skills, technology and productivity, and measures to enhance the ability of business to grow and prosper. However, we need to get through this more difficult part of the economic cycle and emerge stronger. For Britain to join the euro, it must be from a position of sustained economic strength.
The second point is that these are early days for the euro. It is sensible to see how it settles down and how the ECB steers a path consistent with both strong economic discipline and the avoidance of deflation.
Thirdly, it will take some time to make a clear judgment about whether the direction of economic reform in Europe will enable us to meet the tests that we have set out, particularly on flexibility and jobs.
| Next Section
| Index | Home Page |