Julie Morgan MP

New review should bring more money for ASW pensioners

We had the debate on Report stage of the Pensions Bill yesterday. This was an opportunity for the Government to move further on money for the Financial Assistance Scheme, which is designed to help people such as the Allied, Steel and Wire workers here in Cardiff who lost their occupational pensions when ASW shut down in 2002.

It has taken a long time to extend the Scheme, but we are making progress. In this year's Budget, Gordon Brown announced that the Scheme's funds would increase to £8 billion, which should mean that every one of the 125,000 workers should receive some help. But I felt that the Government could go still further, so I tabled an amendment to the Bill to bring the Scheme's coverage up to 90% of the value of the lost pensions. Here's the speech I made:

Julie Morgan (Cardiff, North) (Lab): I thank you, Mr. Deputy Speaker, for calling me to speak about amendment (a) to new clause 38, and new clause 24. I am also a signatory to new clauses 25 and 26.

The debate is important to the 125,000 people who have been affected by the collapse of their pension schemes. The experience of my constituents who are former employees of Allied Steel and Wire is much in my mind as we debate the subject today. I, along with other hon. Members, have been campaigning for a long time to get justice for the Allied Steel and Wire workers and others throughout the country.

In Cardiff, 893 employees from Allied Steel and Wire lost their pensions when the private company went bankrupt. All hon. Members have had experience of the utter misery that that caused and its awful effect on families. Many people have come to my surgery and spoken about the personal devastation that was brought upon them. Losing their jobs was one thing and losing their pensions came right on top of it. That was a devastating blow. Many had worked in the steel industry all their lives—and we all know that working in that industry is hard.

Some people have never talked about the trauma of what happened to them. A woman came to my constituency office last week and said that her husband lost his job and his pension and had never spoken of it. The overwhelming horror of what happened to him has meant that he has never been able to talk about it. We are talking about those people’s lives today.

It is important to acknowledge what the Government have done to respond to that devastation in people’s lives. The former employees, the unions, especially Community and Amicus, with which I have worked closely, and Members of Parliament, especially, at the beginning, my hon. Friend the Member for Cardiff, West (Kevin Brennan), led a campaign that resulted in setting up the Pension Protection Fund, which will protect pensions in that position from now on. That was a big step forward. I also applaud the Government’s establishment of the financial assistance scheme and their work to improve it. When it was originally set up, it applied only to members who had reached retirement age or were within three years of doing so. It was woefully inadequate to address the needs of all the pensioners.

The pensions White Paper of 2006 extended the scheme to those within 15 years of retirement, with total funding of £2.3 billion, which the new clause increases to 80 per cent. of core benefits. The FAS has been gradually extended, but the process has been long and tortuous. It has taken five years and it has felt as though the campaigning of Members of Parliament, the unions and others forced the Government to improve the provision in the FAS. Nevertheless, they have done that. Many hon. Members, the Community and Amicus unions and I welcome the major step forward that the Government have taken in recognising that the FAS was not adequate to provide a decent income in retirement for the estimated 125,000 people who lost their pensions through no fault of their own.

The new clause means that all those people will get some help. Some were previously excluded. In my constituency, there are people who had worked for 30 years but, until the new clause is enacted, are eligible for nothing because they started work at an early age—some at 14—in the steelworks in Cardiff and were only 54 when they lost their jobs. They were thus not eligible for any of the benefits. Now all of them will get something. That is a big step forward, but we need to go further.

Amendment (a) has the support of the Community and Amicus unions and I pay tribute to their work. They took the case to the European Court of Justice and have worked tirelessly on the issue. The new clause would ensure that those who lost their pensions before the establishment of the PPF receive the same support as those who benefit it from it in future. Amendment (a) does not prescribe where the funding for the PPF level of benefit should come from. Much discussion has taken place about how the £8 billion over 50 years will work out—how much it will cost and whether it will stretch further than we think. I do not know the answer, but there have been queries about how far the money will go.

Mark Pritchard (The Wrekin) (Con): Does the hon. Lady share my concern that the review will not report until later this year? There is no immediacy in tackling some of the problems that hon. Members of all parties face in their constituency surgeries week in, week out. Does she also share my concern that there is no obvious legislative time slot to include any outcomes of the review in primary legislation? We could sort the matter out today.

Julie Morgan: I thank the hon. Gentleman for that intervention. I understand from what the Minister said earlier that the initial recommendations will be made by the summer. We certainly want them to be made as soon as possible. We did get a commitment to a time scale from the Minister today, and I welcome that fact that it is to happen by the summer.

The combination of the extra funds already committed by the Government and the review of how best to use the assets of the schemes in wind-up might be enough to fund an increase up to the PPF level. The Government have not given a commitment to do that, but there is a possibility that it will happen.

Mr. David Winnick (Walsall, North) (Lab): I am obviously sympathetic to what my hon. Friend and other colleagues are saying. A constituent of mine who is due to retire shortly came to see me in my surgery. He told me that the Armstrong Pension Group, which was connected with Corus, had collapsed, and that he was going to receive only about £2,500 a year instead of the £10,000 he had expected. He was shattered by that. I took up his case and I am glad to say that he is going to receive more money, through the Pension Protection Fund. I am told that it will be about 80 per cent. of what he was expecting to get. I am very sympathetic to the arguments being put about certain other cases, but we should also pay tribute to the way in which the Pension Protection Fund is helping so many people who would otherwise be living in acute poverty. I also raised this case on the Floor of the House before I received that recent information.

Julie Morgan: I thank my hon. Friend for that contribution.

I welcome the review announced by the Government today, and I hope that it will produce the results that we need. My concern, however, is that it will not give any certainty. Amendment (a) would ensure that those who currently receive the reduced FAS level would receive 90 per cent. of their expected pension, capped at about £26,000, rather than 80 per cent. Since 1997, pensions have been index-linked, either to the retail prices index or to 2.5 per cent., whichever is the lower, rather than being index-linked only until people draw them at 65 years of age. According to what the unions have told me, they would then decline by more than a third in the first 10 years, and by more than 50 per cent. should the pensioner live to over 85 years old. Immediate benefits could be gained if we were to adopt the PPF proposals.

Jenny Willott (Cardiff, Central) (LD): Does the hon. Lady share my concern that the proposal to provide 80 per cent. of the expected pension relates only to the core pension benefits? For many of the people getting this support, that would equate to only about 60 per cent. of the amount that they had planned for, which represents a significant drop in their expected retirement income.

Julie Morgan: Yes, that is a matter of concern. Another issue is that there is a provision under the Pension Protection Fund for the payment of a lump sum, which many people were relying on to pay off their mortgages but which they cannot do under the FAS provisions. There would therefore be many advantages to bringing the FAS provisions up to the PPF levels.

We have come a long way, but we need to do just a little more to sort this out in a way that is satisfactory to me and other hon. Members whose constituents have suffered as a result of these problems, and to bring the unions in to support what the Government are doing. If the problem is not sorted out now, there is always a possibility that the Government could be forced, either by the UK High Court or by the European Commission, to introduce PPF-equivalent benefits for those who currently qualify for the FAS. This issue has been a running sore. It has been going on for five years and caused huge anxiety to many people. It would be very good if we could now settle the matter and put it behind us.

Community and Amicus took their cases to the European Court of Justice, and might be intending to go the High Court here. However, they have not started any such court action yet, because they are waiting to see whether we can sort the matter out politically. They were confident that a Labour Government would be able to sort out the different levels of the benefits.

The High Court ruled in February this year that the Government should not have rejected the report by the parliamentary ombudsman, Ann Abraham, on pension schemes that had collapsed. The Government were asked to reconsider; they have now done so and come back with their proposals in new clause 38. The High Court decision did not mean that the Government had to compensate workers for their losses, but the ruling by Mr. Justice Bean meant that they had to rethink the issue of compensation. That has been done, and we have made huge progress, but I would like to see this go one step further so that full justice can be done. The injustice suffered by Allied Steel and Wire workers in my constituency has made me see at first hand how awful this situation has been. Thank goodness it is unlikely to happen again, now that we have the Pension Protection Fund in place, but there is still a defined group of pensioners whom we need to help.

I am considering what the Minister has said today at the Dispatch Box. I was pleased that he guaranteed that Community and Amicus would become involved in the review process and that they would be consulted about it. I am also glad that there was a definite commitment to ensuring that the available funds would be applied to supplementing the FAS provision, to get it nearer to 90 per cent. I realise, however, that that was not a guarantee, and that some uncertainty therefore remains. I was pleased that the Minister said that the review would make its initial recommendations by the summer, and that it would report publicly. That also represents a big move forward. I know that Community and Amicus now want to work with the Government to ensure that the 80 per cent. figure moves closer to 90 per cent., which is what most hon. Members want.

The past five years have been a sorry time for those pensioners. We have had a lot of improvements from the Government, but I want things to go a step further. However, I am considering what the Minister has said today at the Dispatch Box.

In the end I did not press my amendment to a vote, as we have a guarantee that we will have the review and that it is likely that more money will be found. We now await the report of the review in the summer — and I will pushing hard for that money to be made available to those who have suffered through the loss of their pensions.

Hope on occupational pensions

There is hope that there will be progress on the issue of occupational pensions after a promising statement in the House today from Pensions Secretary John Hutton. Here's the text:

The Secretary of State for Work and Pensions (Mr. John Hutton): With permission, Mr. Speaker, I want to make a statement on yesterday’s judgment on the Government’s response to the ombudsman’s report concerning the security of final salary occupational pension schemes. Given the importance of the issue to many right hon. and hon. Members, I want to inform the House of the position that we have reached both in the light of that particular ruling and the decision last month of the European Court of Justice on the implementation of the insolvency directive.

The High Court yesterday made five rulings in its judgment. I want to take each in turn. Its first ruling was that the ombudsman was entitled, on the evidence available to her, to reach the conclusion that official information published on the minimum funding requirement for pension schemes was inaccurate and potentially misleading, and therefore amounted to maladministration. The Court particularly criticised the then Government’s guide to the Pensions Act 1995, which was published in 1996. This, it concluded, gave the clear impression that following enactment of the new law, scheme members could be reassured that their pensions were safe whatever happened.

The Government had, in good faith and acting on proper advice, taken a different view from that of the ombudsman, on the basis that the leaflets concerned were not a full statement of the law and were for general guidance only. However, we clearly now need to study the Court’s ruling very carefully. In particular, we need to consider the possible implications across government of the Court’s significant proposition, on which this ruling was based, that findings of fact made by the ombudsman are binding, unless they are flawed, irrational or peripheral, or unless there is fresh evidence.

The Court’s second ruling related to the important issue of causation. The ombudsman had found that maladministration was a significant contributory factor in the creation of the financial losses suffered by individuals. She went on to argue that everyone who between 1997 and 2004 suffered losses on the winding up of their pension scheme was the victim of injustice because of maladministration. The Government had argued that that was not well founded. The Court found in favour of the Government on this point, describing that aspect of the ombudsman’s report as “logically flawed and unreasonable.”

The Court’s third ruling rejected the ombudsman’s finding that the Government were guilty of maladministration when they made changes to the pension scheme funding rules in 2002. It decided that the ombudsman’s finding was not logically sound. In its fourth ruling, the Court also dismissed the claim that the Government’s refusal fully to restore the pension entitlements of all affected scheme members was in breach of the European convention on human rights. The Court’s fifth and final ruling concluded that I should reconsider the ombudsman’s recommendation that the Government should consider making arrangements to restore fully the pension losses of the people concerned when their employers became insolvent.

In a clear sign of both the complexity and, yes, the importance of these matters, both sides have sought and been granted permission to appeal. We have not yet decided the precise grounds for such an appeal, but it is absolutely right and proper that we take time to study the judgment and consider its implications in detail.

The judgment of the European Court of Justice in January on the implementation of the insolvency directive has an important bearing on the issue of financial redress for those who have lost some or all of their pension entitlement. The decision of the European Court of Justice effectively requires the Government to reconsider whether the present arrangements offer sufficient protection for people’s pensions when their employer becomes insolvent. The European Court of Justice has ruled that the system of protection that was in place before 2004 did not comply with the terms of the directive, even taking account of the subsequent introduction of the financial assistance scheme, albeit before its 2006 extension. We are already reviewing the financial assistance scheme with that finding in mind. It is now for the High Court to be asked to decide whether damages for breach of the directive should be paid, taking account of the steer apparently given by the European Court of Justice that damages may not be payable.

The Government have already acted to provide substantial financial assistance to people who lost pension rights when their employers became insolvent. The financial assistance scheme, supported by £2.3 billion of public money, has been set up precisely for that purpose. Throughout, we have always sought to ensure that those who have suffered the most should receive financial assistance to mitigate their loss. At the same time, we have sought to strike a balance with the interests of taxpayers, who cannot be asked to accept responsibility for effectively underwriting the total value of pension savings.

In considering the right way forward, we are always prepared to consider practical proposals from both sides of the House. I can confirm also that, so as not to add to their financial difficulty, we will meet the costs of the applicants in this case so far, together with the costs associated with our appeal.

People who have lost their pension rights in these circumstances have suffered a great deal. My aim will be to return to the House with our conclusions and our proposals for how we should proceed, and to do that before the conclusion of proceedings on the Pensions Bill.

The news that there will be a new package for those such as the Allied Steel and Wire workers who have suffered through losing their pensions is welcome. Responding to the statement, I asked the Secretary of State:

Julie Morgan (Cardiff, North) (Lab): I welcome my right hon. Friend’s statement, particularly his concluding remarks, and I hope that there will soon be an end to the misery that so many of our constituents have experienced. I am thinking in particular of the 800 Allied Steel and Wire workers from Cardiff who lost their jobs, some of whom also lost all their pension. I hope that they can sleep soundly in their beds, confident that the Government are going to come up with something good for them. Is my right hon. Friend aware, however, that there are people in my constituency who have worked for 30 years and paid in dutifully for 30 years, as the Government advised, but who have ended up with absolutely nothing under the present financial assistance scheme arrangements? Will he take them into account when he makes his statement to the House during the passage of the Pensions Bill?

Mr. Hutton: We are looking at all these issues in the context not only of yesterday’s High Court ruling but, most importantly, of last month’s ruling of the European Court of Justice.

I am going ahead with tabling an amendment to the Pensions Bill currently before the Commons to improve the position for the ASW workers. I will continue to keep constituents updated on this crucial issue — at last it appears we may have some good news to look forward to.

Appropriate services

I managed to speak in both of the oral questions sessions yesterday on the final day of the House of Commons before the recess. On transport, I intervened to ask about providing decent coverage of rail services:

7. Julie Morgan (Cardiff, North) (Lab): If he will take steps to ensure that there is a frequent railway service from all parts of the UK. [109934]

The Parliamentary Under-Secretary of State for Transport (Mr. Tom Harris): New franchise agreements specify a minimum service level that takes account of demand and network capacity. Bidders can propose more services, where that is operationally practicable. There are also provisions to deal with the need for extra trains during the life of a franchise.

Julie Morgan: What can my hon. Friend do to ensure that First Great Western provides a good reliable service into Wales in view of the fact that the 3.15 pm from Paddington now stops at Cardiff and does not go on to Swansea? The 7.03 am from Bristol to Cardiff and Swansea has been taken off altogether. What can he do to ensure that a better service is provided for Wales?

Mr. Harris: I am aware of my hon. Friend’s concerns and they have been echoed by right hon. and hon. Friends over the past few weeks. The 17.18 Cardiff to Swansea service run by First Great Western is a matter for the company: I do not have the authority to intervene in that matter and insist that that particular service is reinstated. However, the Department will continue to monitor passenger numbers on that route. I am told by First Great Western that capacity on alternative services run by Arriva Trains Wales is sufficient to accommodate passenger numbers on that line.

I was also able to intervene during Constitutional Affairs Questions. On a question relating to social exclusion, I asked about Citizens Advice and the Specialist Support Service, which I campaigned to retain earlier this year when it was threatened with closure:

Julie Morgan (Cardiff, North) (Lab): Does my hon. and learned Friend agree that in Wales the citizens advice bureaux, properly supported by the Welsh specialist support service, have an important contribution to make to reducing social exclusion? Will she comment on the future of those two bodies?

Vera Baird: The future for those two bodies is very positive. The point is to turn them over to a fixed-fee regime. They are increasing their productivity massively, which is commendable. They now have a full year in which to do much more of that before they are gently and supportively moved across on to a fixed-fee regime, enabling them to do more work for more people at better quality prices for the taxpayer. It is difficult to get a value-for-money, good quality legal advice service into this country, particularly in rural areas. The Tories never managed it. This Government will.

Supporting our Post Offices

There was a controversial statement yesterday from Alastair Darling, the Trade and Industry Secretary, on the future of the Post Office network. The Government is convinced that changes to the network are needed because of changing habits. As the Secretary of State said yesterday,

"Traditionally, the Post Office was the place where people went to post a letter, to pay their utility bills and to collect their benefits. Many still do, but increasingly people choose to send an e-mail or text, they pay bills by direct debit or internet banking, and they pay for their tax disc online and have pensions or benefits paid into their bank accounts. Of the 11 million pensioners in this country, 8.5 million have their pensions paid into a bank account. In fact, most people making a new state pension claim choose to do so in this way."

These sorts of changes inevitably take their toll on the Post Office. But I believe it is crucial that where Post Offices form an important part of our communities — as they do in many villages and suburbs in Cardiff North — then they must be maintained. The Government has invested more than £2 billion since 1999 in Post Offices and will continue to invest large sums of money — but there have still been difficult closures, sometimes because those who run local Post Offices do not wish to continue with their work, and sometimes because it is claimed that Post Offices do not get enough business. I have in the past fought closures in Cardiff North where I thought that they would result in unnecessary hardship to local people.

One of the good features of yesterday's statement was the Secretary of State's announcement that the Post Office Card Account will continue:

"The Government introduced the Post Office card account in 2003 to enable people to get their pensions and other benefits in cash at the post office. The Government remain committed to allowing people to get their pension or benefit in cash at the post office if they choose to do so, and a range of accounts available at the post office make that possible. The current Post Office card account contract ends in March 2010. I can tell the House that the Government have decided that they will continue with a new account after 2010. It will be available nationally and customers will be eligible for the account on the same basis as they are now."

This has been one of the key worries of the National Federation of Sub-Postmasters, whom I met with recently. I congratulated the Minister on the decision to retain the POCA, while at the same time asking him to ensure that there will not be patchy Post Office provision in the future:

Julie Morgan (Cardiff, North) (Lab): I am very pleased that the Secretary of State has said that the Post Office card account will continue, which will be a huge relief to the postmasters and mistresses in Wales; that was one of their major requirements. Has he made any assessment of how the proposals will affect Wales? When the last round of urban closures took place, the branches that closed in Cardiff were the ones where the postmasters or mistresses volunteered, which did leave a patchy provision.

Mr. Darling: On the last point, as I said a few moments ago, it is important that we do not end up with areas without postal provision because somebody wanted to go. Indeed, the whole point of having national access criteria is to make sure that there is a network, and that branches are within a reasonable distance of where people live. On the card account, I am grateful for what my hon. Friend said because I know that this is one of the things about which the federation and many of those who signed the petition were very concerned.

Julie presses Government over Allied Steel and Wire pensions

I spoke yesterday in the Estimates Day debate on occupational pensions. This is an issue which is hugely important in Cardiff due to the collapse of Allied Steel and Wire in 2002. When those 838 people lost their jobs, they also lost their pensions. The Government has responded to this and other similar situations by setting up the Pension Protection Fund, so that in the future no-one will lose their pension in this way, and by creating the Financial Assistance Scheme, which provides some funds for people who have lost their occupational pension. But the cut-off date for assistance means that barely anyone from ASW gets help.

I'm a member of the Public Administration Select Committee, which has looked into the Government's refusal to adopt the recommendations of the ombudsman on this. Yesterday's debate gave me the chance to bring ASW pensioners' concerns to the Floor of the House. I'm determined that ASW pensioners should receive all the money that they are entitled to and that justice should be done.

Julie Morgan (Cardiff, North) (Lab): As a member of the Public Administration Committee, I am very pleased to speak in this debate. This is an important debate in two respects: first, in relation to the fate of the estimated 125,000 people affected; and secondly, in relation to the status of the ombudsman’s office and the Government’s response to her recommendations.

The Public Administration Committee, ably led by my hon. Friend the Member for Cannock Chase (Dr. Wright), interviewed many people who had suffered the loss of most of their pensions. They gave moving testimonies. As a Cardiff MP, my constituency was very much affected by the closure of Allied Steel and Wire, which, in 2002, went into receivership, resulting in 838 employees losing their jobs. In the summer, I met a large group of Allied Steel and Wire workers in my constituency, who told me how upset they were when they first learned that the plant would close, although at least they thought that their pensions were safe. Ten days later, however, they learned that they had lost most of their pensions. When the ombudsman’s report came out, they believed that they were saved. They thought that the Government always took notice of the ombudsman and that there would be a solution. The issue of the ASW workers’ pensions is still a running sore, and they continue to campaign on it to this day. They strongly believed that the ombudsman was an independent voice that the Government would heed, but that has not happened in this case.

On Monday, the ombudsman made a speech at a seminar at the constitution unit. She mentioned three prominent cases where there was disagreement but where the Government changed their mind and, to some extent at least, remedied the injustice. As a result of our debate, I hope that the Government will think again, and that they will look back to see how the Government did change their mind in those three cases and moved, at least in part, towards what the ombudsman recommended. There are now two outstanding cases, one of which is the occupational pensions issue.

I do not suggest that the Government have done nothing. The Pension Protection Fund has been mentioned and it will in future protect pensioners who fall into such circumstances. The Government have also set up a financial assistance scheme, but we have heard about that today and we know that it is woefully inadequate. I pay tribute to the hard work that has been done, led by ASW pensioners and by the unions Amicus and Community, to keep the issue on the agenda by taking it to the European courts and trying to get recompense for their members. The changes that were made to the financial assistance scheme—which must have been brought in partly as a result of the ombudsman’s report—improved things by extending the scheme to those within 15 years of retirement. That was a step forward. But there are still huge inadequacies.

I have constituents who miss out on the 15-year extension even though they paid into the pension fund for more than 30 years. One of my constituents, from Whitchurch in Cardiff, misses the 15-year extension by three months. It is impossible to underestimate the stress and anxiety that is caused to entire families.

Another constituent from Heath worked in the steel industry in Cardiff from the age of 15. He worked with ASW until the closure in 2002, contributing to the works pension scheme. He had previously contributed to the state earnings-related pension scheme, and he transferred to the final salary works pension scheme believing—under the guidance of the Government, as he saw it—that that was guaranteed. When he heard about the increased funding under the financial assistance scheme he wrote to me:

“To my utter dismay, I find that no assistance is available to me, since I do not fall into the category of being within 15 years of retirement, being 2 months short of the qualifying period. This is totally unjust, as up to the closure of ASW, I was employed in a very harsh environment, paying taxes fully, while doing my utmost to secure my future for retirement via the works pension scheme, as recommended by the Government...After 34 years contributing, I face a bleak retirement.”

The ASW pensioners whom I have met in Cardiff all believed that they were following the Government’s guidance, and they also believed that the Government would act on the ombudsman’s recommendations. This is a matter of trust, and the Government should address it. It will be good if the Minister confirms today that they will at least look at what can be done to address the important issues that have been raised.

Attention has been drawn to the ombudsman’s recommendations. She has not asked for the Government to fork out the entire amount. She was not asking for a blank cheque. As she said:

“I did not say, “Write a blank cheque”, but to organise a remedy.”

The Government’s response to the ombudsman has, however, been very disappointing. It states that

“the Government does not believe that the information issued by the Government can be regarded as having caused the losses”.

The Government cannot of course be blamed for the failure of the schemes. The failure was that member schemes were not protected by the Government in the way that the members believed they were. That is what they said in evidence to the Committee. They believed that they were protected. However, although we are not blaming the Government for the fact that these schemes have collapsed, it is in this context that they should look at the matter.

On the question of the leaflets, the Government reject the notion of maladministration because they believe that it was clear that the information on the leaflets should not have been taken in isolation. However, the ombudsman made it clear to us in Committee that the information did influence many of the people affected. She described individuals coming to see her and showing her the parts of the leaflets to which they had paid attention. There is no doubt in my mind that the ASW pensioners in Cardiff strongly believed that they had been following Government advice, and that, as far as they were able, they had looked into protecting themselves responsibly for their retirement.

Most of the past disagreements between the Government and the ombudsman have reached a satisfactory conclusion, and the ombudsman herself says that she sees no need for a power to make her recommendations legally binding. Surely Parliament can work out a solution to this situation. The evidence is strong and compelling. The Government should listen to what is being said in the House today and find some way of sorting out a grievous situation and running sore that will otherwise continue.

Banning the buffet

I made a quick intervention in yesterday's Opposition Day debate on transport strategy to raise the issue of First Great Western's services from London to Wales. My Swansea colleague Sian James was remarking that FGW has been named as one of the least reliable rail franchises in Britain, with only a 79.4% reliability record, and that the 1515 hours service from London Paddington to Swansea was being cancelled. There are other concerns, too, not just about punctuality but also about overcrowding and services:

Julie Morgan (Cardiff, North) (Lab): I support my hon. Friend’s remarks about First Great Western. If the service beyond Cardiff is going to stop, the service to Cardiff may soon stop as well. It shows a lack of interest in Wales on the part of First Great Western. Is she aware of the proposal to cut the buffet service between Cardiff and Paddington, which I have received a complaint about? Does she think that that is a strange way of improving the rail service?

Mrs. James: I certainly do. It highlights the fact that a company that was recently engaged in a re-franchising process, when it made many promises, is now making cuts at will and making changes that suit it, not the people that it is supposed to be serving.

Apparently FGW believes that it can save eight minutes on journeys by replacing the buffet service with a trolley service. This is difficult to imagine for those First Great Western services which are standing room only!

I'm always very grateful for comments and representations from constituents on the rail service from Cardiff to London — I've raised before in the House the cost of the journey, which incredibly is more than the cost of a plane ticket to some European capitals. With the recent news of more above-inflation increases in ticket prices, it's important that the rail operators remember that they are, after all, providing a public service.

Tax Credits: A change that needs to be made ...

I raised the issue of tax credits again at Business Questions to Jack Straw this afternoon. A few weeks ago, I pointed out that while tax credits have been invaluable in alleviating poverty, we need to amend the law so that the Independent Appeal Tribunal can have jurisdiction over alleged tax credit overpayments. This would be an important change would I am sure would assist those constituents who have been faced with massive bills. On 14 November, the European Court of Human Rights passed a judgement which could have implications on this — it referred to the fact that those arbitrating on a housing benefit case were in effect judging themselves. Where tax credits are concerned, civil servants are effectively judging themselves, so if the ECHR can hold that this shouldn't be done in the case of housing benefit, then that has implications for tax credits, too.

Here is the exchange from earlier:

Julie Morgan (Cardiff, North) (Lab): Will my right hon. Friend ask the Paymaster General to make a statement about the ruling of the European Court of Human Rights on 14 November 2006, which may have implications for decisions about the overpayment of tax credits? At the moment, the decision is made by a group of civil servants with no independent appeal and the only recourse is judicial review. As I understand it, the ruling would make that inadequate under article 6. Will my right hon. Friend look at that matter?

Mr. Straw: Yes, I will. I know that my right hon. Friend the Paymaster General is studying the court judgment and its implications with care and I will invite her to make her response to the House in due course.